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HomeMy WebLinkAboutNO 3 - Convention Center Agrmt CONVENTION CENTER AGREEMENT BETWEEN CITY OF MIAMI BEACH AND MB REDEVELOPMENT, INC. FOR THE CONVENTION CENTER - \ \ TABLE OF CONTENTS Page 1. DEFINITIONS... ............. ............ ................................ ............ ........... .................. ..... ........ 1 2. TERM .............................................................................................................................. 2 3. THE HOTEL OWNER'S COVENANTS AND OBLIGATIONS.......................................... 2 4. ADVERTISING AND PROMOTIONAL ACTIVITIES ........................................................ 3 5. THE COVENANTS AND OBLIGATIONS OF THE OWNER............................................ 5 6. DEFAULT..................................................................................................................... ... 5 7. NOTICE AND RIGHT TO CURE HOTEL OWNER'S DEFAULTS ................................... 7 8. DAMAGE, DESTRUCTION AND RESTORATION .......................................................... 8 9. CONDEMNATION ...... ........................................ ...................... ......... .................. ..... .......8 10. INSURANCE................................................................................................................ 10 11. NO PARTNERSHIP ..................................................................................................... 10 12. NOTI CES.......... ...... . ...................... .... ..... ......................... ......................... .... ......... ...... 1 0 13. LIABILITY .................................................................................................................... 13 14. INDEMNIFICATION AND DEFENSE OF CLAIM......................................................... 13 15. INVALIDITY OF CERTAIN PROVISIONS ................... ............. ............... .......... .......... 15 16. SUCCESSORS............................................................................................................ 16 17. NO THIRD PARTY RIGHTS........................................................................................ 16 18. NO DiSCRIMINATION................................................................................................. 16 19. APPLICABLE LAW...................................................................................................... 16 20. ENTIRE AGREEMENT; NO WAIVER ......................................................................... 16 21. RECORDATION.......................................................................................................... 16 22. UNAVOIDABLE DELAy.... .......................... ............................... ...... ............... ..... ....... 16 MI96191 0.043/07/09/96 CONVENTION CENTER AGREEMENT THIS CONVENTION CENTER AGREEMENT (the "Agreement") is made and entered into as of the JO~ day of ~kmw, 1996, by and between MB Redevelopment, Inc., a Florida corporation ("Hotel Owner"), and the City of Miami Beach, a Florida municipal corporation, in its capacity as owner of the Convention Center (the "Owner"). WITNESSETH: WHEREAS, the Miami Beach Redevelopment Agency (the "Agency") and Hotel Owner have entered into that certain Agreement of Lease (the "Lease") of even date herewith, pursuant to which, among other things, Hotel Owner has agreed to own and operate a convention center hotel located at Collins Avenue and 16th Street, Miami Beach, Florida (the "Hotel") in accordance with the terms of the Lease; WHEREAS, the Owner has from time to time adopted policies and procedures with respect to bookings at the Convention Center and has advised Hotel Owner of such policies and procedures. WHEREAS, the Owner and the Agency desire Hotel Owner to enter into an agreement setting forth the terms on which Hotel Owner will (a) make available Hotel facilities and services for support of the Convention Center events and (b) undertake joint marketing efforts. NOW, THEREFORE, in consideration of the payment of ten ($10.00) dollars, the mutual covenants and payments hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto intending to be legally bound, agree as follows: 1. DEFINITIONS: (a) For all purposes of this Agreement, the terms defined herein shall have the following meanings: "Booking Arrangement" means a tentative agreement, letter of intent, option or other arrangement (which may not be legally binding) or a definitive agreement (i) with the Hotel for rooms at the Hotel, or (ii) with the Convention Center for an event to be held at the Convention Center, as the case may be. "Convention Center" means that certain convention center located at the site bounded by the streets in Miami Beach, Florida that as of the date hereof bear the following names: Convention Center Drive, Dade Boulevard, Washington Avenue and 17th Street. "Convention Center Groups" means a corporation, association or other group which has entered into a Booking Arrangement with the Convention Center for a trade show, conference seminar, meeting, convention or other event to be held at the Convention Center. MI96191 0.043107/09/96 "GMC&VB" means the Greater Miami Convention & Visitors Bureau, acting in its capacity as a representative of the Convention Center for the booking of certain Convention Center Groups. "Release Date" means the date when rooms included in a Room Block for a particular month may be sold or otherwise dealt with by the Hotel Owner in the ordinary course of business, except for such room nights as to which the Hotel Owner has received a Contract, as defined in Section 3(b) hereof. The Release Date is the date two (2) years in advance of a particular month. Thus, the Room Block for the month of December 2000 has a Release Date of December 1, 1998; from and after December 1, 1998, no Room Block would apply to the month of December 2000. "Room Block" means for each calendar month 650 rooms per day (which shall include a minimum of 25 one bedroom suites) up to an aggregate of fourteen (14) days in each calendar month. (b) Other Terms. All defined terms (denoted by capitalization or other indication of special definition such as quotation marks) used in this Agreement which are not defined in this Article, shall have the meaning set forth elsewhere in this Agreement or in the Lease. All capitalized terms used in this Agreement and which are defined by the Lease survive the termination of the Lease. 2. TERM. Subject to and upon the terms and conditions set forth herein, this Agreement shall take effect on the date hereof (the "Commencement Date") and shall terminate on March 31, 2023. In addition, the Hotel Owner may terminate the Agreement if the Owner fails to maintain the Convention Center with gross building area of no less than one million (1,000,000) square feet and exhibit hall capacity aggregating not less than five hundred thousand (500,000) square feet. 3. THE HOTEL OWNER'S COVENANTS AND OBLIGATIONS. (a) Availability. Hotel Owner agrees that it will cause the Room Block for each calendar month to be available for Booking Arrangements with Convention Center Groups until the Release Date for such month; subject to the following: (i) the number of room nights that may be booked for a Convention Center Group which has not previously booked convention rooms in the national convention meeting market may not exceed 325 room nights, without the prior written consent of Hotel Owner, and (ii) room nights for which the Hotel has entered into a Booking Arrangement in the ordinary course of business, prior to the entering into a Booking Arrangement with a Convention Center Group for such rooms, shall not be available for Convention Center Groups. Owner and Hotel Owner acknowledge that, prior to the date hereof, Hotel Owner has entered into the tentative Booking Arrangements for Convention Center Groups set MI961910.043/07/09/96 -2- forth in that certain letter agreement dated the date hereof between Hotel Owner and GMC&VB. Owner and Hotel Owner acknowledge and agree that all such tentative Booking Arrangements are within the Room Block, subject to the execution of a Contract as provided in (b) below. (b) Reservations. (i) A Convention Center Group wishing to book available rooms in a Room Block shall enter into Hotel Owner's standard convention group room reservation agreement (the "Contract") prior to the Release Date for the applicable Room Block, which will include provisions regarding rooming lists, release dates, rates, credit requirements and such other terms and conditions as are customarily included in such agreements in the ordinary course of business. (ii) From time to time, if the Room Block for a particular month has been exhausted, Hotel Owner will, if requested by GMCV&B and subject to projected availability and such other factors as Hotel Owner may deem appropriate, meet with additional Convention Center Groups with regard to additional rooms at the Hotel, it being recognized that Hotel Owner, GMCV&B and any such Convention Center Group shall each retain the right, in their individual sole discretion, to determine whether to enter into a Booking Arrangement for additional rooms and the price and all other terms and conditions thereof. (c) Room Rates. (i) Hotel Owner will participate in bidding to provide lodging for city-wide meetings on a competitive basis with other similar hotel properties involved in housing city- wide groups, taking into account a premium for the Hotel's quality, location and proximity to the Convention Center. (ii) Hotel Owner shall make the Hotel meeting and function space available to Convention Center Groups reserving through GMC&VB or the Convention Center commensurate with the size of the group, on terms determined by Hotel Owner acting reasonably in the ordinary course of business after consultation with the Convention Center Group. Hotel Owner shall not be required to make any Hotel meeting and function space available to Convention Center Groups which have not reserved rooms at the Hotel. (iii) Hotel Owner shall make the Hotel's catering or restaurant facilities or other food and beverage services available to Convention Center Groups commensurate with the size of the group on terms determined by Hotel Owner acting reasonably in the ordinary course of business after consultation with the Convention Center Group. Hotel Owner shall not be required to make any Hotel catering or restaurant facilities or other food and beverage services available to Convention Center Groups which have not reserved rooms at the Hotel. MI961910.043/07/09/96 - 3- 4. ADVERTISING AND PROMOTIONAL ACTIVITIES. (a) Hotel Owner will maintain membership in the GMC&VB. In addition, Hotel Owner will actively participate in promotional activities with the GMC&VB and the Convention Center, including, but not limited to, trade shows and advertising. Hotel Owner will also invite representatives of the GMC&VB and the Convention Center to participate, where appropriate, in industry trade shows, sales blitzes, focus groups, and other Hotel supported industry events. (b) The parties acknowledge that it may be appropriate to promote the Hotel and the Convention Center in common advertisements or other promotional efforts or materials. The parties further acknowledge the importance to the Hotel of maintaining its public image. Accordingly, the parties shall observe the following requirements relative to any advertising or promotional efforts or materials with respect to the Hotel and/or the Convention Center: (i) No advertisement or promotional effort or material shall be developed or published by the Owner, GMC&VB or the Convention Center which in any manner infers the involvement of the Hotel in any event at the Convention Center, unless Hotel Owner has first approved in writing its design, content, subject matter, method of promotion and other features. No advertisement or promotional effort or material shall be developed or published by the Hotel Owner which in any manner infers the involvement of the Hotel in any event at the Convention Center, unless the Owner has first approved in writing its design, content, subject matter, method of promotion and other features. (ii) Any advertisement or promotional efforts or materials shall be paid for by the party responsible for initiating it or in such other manner as the parties may agree in writing. As used in this paragraph 4, the term "promotional efforts or materials" shall include, without limitation, radio or television ads, electronic media, flyers, magazine or newspaper ads, public announcements, news releases, promotional products and billboard or other public signs. (c) Intentionally Deleted. (d) GMC&VB, the Owner, and the Convention Center acknowledge that neither has any consent or approval rights with respect to the Hotel's marketing plan or the amount of the Hotel marketing budget or how such amount is used. Hotel Owner MI96191 0.043107/09/96 -4- acknowledges that it has no consent or approval rights with respect to the GMC&VB's, the Owner's, and the Convention Center's individual marketing plans or the amount of their marketing budgets or how such amounts are used, except for such rights, if any, given to a hotel as a member of the GMC&VB. 5. THE COVENANTS AND OBLIGATIONS OF THE OWNER. The Owner covenants and agrees and will cause any third party operator of the Convention Center to comply with the following covenants: (a) Operation of the Improvements. The Owner, at its expense, shall operate, maintain and manage the Convention Center and any accessory use or shall cause the operation, maintenance and management of, the Convention Center and any accessory use at a level at least equal to that level maintained on the date hereof. (b) Standards. The Convention Center shall maintain the standards of quality and operation comparable to other major convention centers in the group market in the United States (the "Standards"). (c) Maintenance. The Owner, at its expense, shall take good care of, and keep and maintain, the Convention Center in good and safe order and condition, and shall make all repairs therein and thereon, interior and exterior, structural and nonstructural, ordinary and extraordinary, foreseen and unforeseen, necessary to keep the Convention Center in good and safe order and condition, consistent with the Standards, however the necessity or desirability therefor may arise. (d) Management. The Owner shall cause the Convention Center to be managed by a professional manager with the requisite experience in managing major convention centers. (e) Security. The Owner shall keep the Convention Center lighted and shall maintain security in accordance with the Standards. (f) Continuous Operation. The Owner shall keep the Convention Center open for business in the ordinary course of business on a year round basis. (g) Center. Marketing. The Owner shall continue to promote and market the Convention MI961910.043/07/09/96 - 5 - 6. DEFAULT. (a) Hotel Owner Default. The occurrence of anyone or more of the following events shall constitute a default under this Agreement ("Event of Default"): (i) Hotel Owner shall fail to honor a Contract with a Convention Center Group and Hotel Owner shall fail to remedy such default within thirty (30) days after notice by Owner of such default; or (ii) Hotel Owner shall default in the observance or performance of any term, covenant or condition of this Agreement on Hotel Owner's part to be observed or performed (other than to honor Contract as set forth in 6(i) above) and, if no cure period is expressly provided for herein, Hotel Owner shall fail to remedy such default within thirty (30) days after notice by Owner of such default (the "Default Notice"), or if such a default is of such a nature that it cannot reasonably be remedied within thirty (30) days, Hotel Owner shall not (A) within thirty (30) days after the giving of a Default Notice, advise Owner of Hotel Owner's intention to institute all steps necessary (which advice shall include a description of such steps) to remedy such default (which such steps shall be reasonably designed to effectuate the cure of such default in a professional manner), and (8) thereafter diligently prosecute to completion all steps necessary to remedy the same. (b) Termination of Lease. Subject to the provisions of Section 7, below, if the Agency terminates the Lease pursuant to the terms of the Lease because of an "Event of Default" by "Tenant" under the Lease, this Agreement shall be terminated. (c) Remedies on Default. Whenever an Event of Default hereunder shall have occurred and be continuing Owner may take the following remedial steps: (i) With respect to subsection (a)(i) above, Owner shall be entitled to enforce the provisions of this Agreement which require the Hotel Owner to honor the Contract, including, but not limited to, requiring specific performance of the Hotel Owner's obligation to provide the rooms pursuant to the Contract. The Hotel Owner and Owner acknowledge that (A) the covenant to provide the rooms to Convention Center Groups pursuant to this Agreement is a material inducement to Agency and Owner to enter into the Lease and this Agreement and (8) that in the event of a breach of such covenant, monetary damages will be inadequate to compensate Owner for harm resulting from such breach and Owner shall have the right to seek injunctive relief to compel the cure of such breach. (ii) With respect to subsection (a)(ii) above, Owner is entitled sue for damages. (d) Events of Default by Owner. If Owner shall default in the observance or performance of any term, covenant or condition of this Agreement on Owner's part to be observed or performed and, if no cure period is expressly provided for herein, Owner shall fail to remedy such default within thirty (30) days after notice by Hotel Owner of such MI96191 0.043/07/09/96 -6- default (the "Owner Default Notice"), or if such a default is of such a nature that it cannot reasonably be remedied within thirty (30) days, Owner shall not (i) within thirty (30) days after the giving of a Owner Default Notice, advise Hotel Owner of Owner's intention to institute all steps necessary (which advice shall include a description of such steps) to remedy such default (which such steps shall be reasonably designed to effectuate the cure of such default in a professional manner), and (ii) thereafter diligently prosecute to completion all steps necessary to remedy the same; then the Hotel Owner is entitled to sue for damages. The Hotel Owner and Owner acknowledge that (A) the covenant to maintain and operate the Convention Center pursuant to this Agreement is a material inducement to Hotel Owner to enter into the Lease and this Agreement and (8) that in the event of a breach of such covenant, monetary damages will be inadequate to compensate Hotel Owner for harm resulting from such breach and Hotel Owner shall have the right to seek injunctive relief to compel the cure of such breach. (e) Right to Enjoin Defaults or Threatened Defaults. In the event of Hotel Owner's default or threatened default, Owner shall be entitled to seek to enjoin the default or threatened default and shall have the right to invoke any rights and remedies allowed at law or in equity or by statute or otherwise, except to the extent Owner's remedies are limited as set forth in this Agreement. In the event of Owner's default or threatened default, Hotel Owner shall be entitled to seek to enjoin the default or threatened default and shall have the right to invoke any rights and remedies allowed at law or in equity or by statute or otherwise, except to the extent Hotel Owner's remedies are limited as set forth in this Agreement. Each right and remedy of Owner and Hotel Owner provided for in this Agreement shall be cumulative and shall be in addition to every other right or remedy provided for in this Agreement or now or hereafter existing at law or in equity or by statute or otherwise, except to the extent Owner's remedies and Hotel Owner's remedies are limited as set forth in this Agreement, and the exercise or beginning of the exercise by Owner or Hotel Owner of anyone or more of the rights or remedies provided for in this Agreement or now or hereafter existing at law or in equity or by statute or otherwise shall not preclude the simultaneous or later exercise by Owner or Hotel Owner of any or all other rights or remedies provided for in this Agreement or now or hereafter existing at law or in equity or by statute or otherwise. (1) Performance at Each Party's Sole Cost and Expense. Unless otherwise expressly provided in this Agreement, when either party exercises any of its rights, or renders or performs any of its obligations hereunder, such party shall do so at its sole cost and expense. 7. NOTICE AND RIGHT TO CURE HOTEL OWNER'S DEFAULTS. (a) Notice. The Owner shall give to a Recognized Mortgagee and/or an Affiliate Mortgagee, a copy of each notice of default at the same time as it gives notice of such default to Hotel Owner, and no such notice of default shall be deemed effective with respect to any Recognized Mortgagee or Affiliate Mortgagee unless and until a copy thereof shall have been so given to such Recognized Mortgagee or Affiliate Mortgagee, as MI96191 0.043/07/09/96 -7- applicable. All such notices to a Recognized Mortgagee or an Affiliate Mortgagee shall be sent as set forth in the Lease. The Owner shall also give a Recognized Mortgagee notice ("Notice of Failure to Cure") in the event Hotel Owner fails to cure a default within the period, if any, provided in this Agreement for such cure, promptly following the expiration of such period. (b) Cure Right. The Recognized Mortgagee shall have a period of sixty (60) days after receipt of the Notice of Failure to Cure, in the case of any event of default, to cure the event of default referred to in the Notice of Failure to Cure or cause it to be cured. Nothing contained herein shall be construed as imposing any obligation upon any Recognized Mortgagee to so perform or comply on behalf of Hotel Owner. (c) Acceptance. The Owner shall accept performance by a Recognized Mortgagee of any covenant, condition or agreement on Hotel Owner's part to be performed hereunder with the same force and effect as though performed by Hotel Owner. (d) Priority. If there is more than one Mortgagee, only that Mortgagee, to the exclusion of all other Mortgagees, whose Mortgage is most senior in lien shall be recognized as having rights pursuant to this Section 7, unless such first priority Mortgagee has designated in writing to Owner a Mortgagee whose Mortgage is junior in lien to exercise such right. 8. DAMAGE, DESTRUCTION AND RESTORATION (a) Notice to Owner. If the Convention Center is damaged or destroyed in whole or in any material part by fire or other casualty, Owner shall notify Hotel Owner of same as soon as reasonably possible after Owner's discovery of same. (b) Obligation to Restore. If all or any portion of the Convention Center are damaged or destroyed by fire or other casualty, ordinary or extraordinary, foreseen or unforeseen, Owner shall, in accordance with the provisions of this Section restore the Convention Center to the condition thereof as it existed immediately before such casualty (a "Casualty Restoration"), regardless of whether the Net Insurance Proceeds shall be sufficient therefor. "Net Insurance Proceeds" shall mean the actual amount of insurance proceeds paid or self-insurance reserves or proceeds funded following a fire or other insured casualty. (c) Commencement of Construction Work. Owner shall commence the construction work in connection with a Casualty Restoration within ninety (90) days after the Casualty and shall diligently pursue the completion of such Casualty Restoration. 9. CONDEMNATION (a) Substantial Taking. If all or Substantially All of the Convention Center is taken for any public or quasi-public purpose by any lawful power or authority by the MI96191 0.043/07/09/96 - 8- exercise of the right of condemnation or eminent domain (a "Total Taking"), this Agreement shall terminate as of the Date of Taking. (b) Definitions. (i) "Date of Taking" means the earlier of (A) the date on which actual possession of all or Substantially All of the Convention Center, or any part thereof, as the case may be, is acquired by any lawful power or authority pursuant to the provisions of applicable law or (B) the date on which title to all or Substantially All of the Convention Center, or any part thereof, as the case may be, has vested in any lawful authority pursuant to the provisions of applicable law. (ii) "Substantially All of the Convention Center" means such portion of the Convention Center as, when so taken, would leave, in Hotel Owner's and Owner's mutual good faith determination, a balance of the Convention Center that, due either to the area so taken or the location of the part so taken in relation to the part not so taken, would not, under economic conditions, physical constraints, zoning laws, building regulations or other Requirements then existing, readily accommodate a new or reconstructed building or buildings and other improvements of a type fully comparable to the Improvements existing at the Date of Taking. If Hotel Owner and Owner do not determine that "Substantially All of the Convention Center" has been taken, then this Agreement shall not terminate and expire but shall continue in force and effect, subject to the other provisions of this Section. If Hotel Owner and Owner determine that "Substantially All of the Convention Center" has been taken, then this Agreement shall terminate and expire on the Date of Taking pursuant to subsection 9(a). (c) Less Than A Substantial Taking. If less than Substantially All of the Convention Center is taken for any public or quasi-public purpose by any lawful power or authority by the exercise of the right of condemnation or eminent domain or by agreement among Owner and those authorized to exercise such right (a "Partial Taking"), this Agreement shall continue for the remainder of the Term (subject to subsection (d) below) without diminution of any of Hotel Owner's obligations hereunder, but with a fair and equitable abatement of the Room Block. (d) Obligation to Restore the Convention Center. If less than Substantially All of the Convention Center is taken as provided in subsection 9(c), Owner shall, in accordance with the provisions of this Section restore the remaining portion of the Convention Center, to the extent feasible, to the condition thereof as it existed immediately before such taking (a "Condemnation Restoration"), regardless of whether any condemnation award shall be sufficient therefor. (e) Commencement of Construction Work. Owner shall commence the construction work in connection with a Condemnation Restoration within ninety (90) days after receipt of the condemnation award arising from the damage or destruction which MI961910.043/07/09/96 - 9- caused the need for such Condemnation Restoration and shall diligently pursue the completion of such Condemnation Restoration. (f) Temporary Taking. If the temporary use of the whole or any portion of the Convention Center is taken for a public or quasi-public purpose by a lawful power or authority by the exercise of the right of condemnation or eminent domain or by agreement between Owner and those authorized to exercise such right, Owner shall give Hotel Owner notice within five (5) business days thereof. If such temporary taking is for a period in excess of one hundred eighty (180) days, then such taking shall be deemed a permanent taking and the provisions of subsections 9(a) and 9(b), as applicable, shall apply. (g) Intention of Parties. The existence of any present or future law or statute notwithstanding, it is the intention of the parties that Owner (i) shall not consent to any condemnation or taking of all or any part of the Convention Center and (ii) waive all rights to quit or surrender the Convention Center or any part thereof by reason of any condemnation or taking of less than Substantially All of the Convention Center. 10. INSURANCE. For so long as the City, the Agency or any instrumentality of the City or the Agency is the Owner hereunder, such Owner may elect to carry any insurance, in whole or in part, under any plan of self-insurance. which plan shall cover liability, casualty and other coverages in a manner substantially similar to the current self- insurance plan in effect for the Convention Center. 11. NO PARTNERSHIP. Nothing contained in this Agreement shall be deemed or construed to create a partnership or joint venture of or between the Owner and Hotel Owner. 12. NOTICES. (a) In Writing. Whenever it is provided herein that notice, demand, request, consent, approval or other communication shall or may be given to, or served upon, either of the parties by the other (or any Recognized Mortgagee), or whenever either 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 (referred to in this Section 12 as a "Notice") shall be in writing and shall be effective for any purpose only if given or served by (i) certified or registered U.S. Mail, postage prepaid, return receipt requested, (ii) personal delivery with a signed receipt or (iii) a recognized national courier service, addressed as follows: MI96191 0.043/07/09/96 - 10- if to Hotel Owner if to Owner: MI96191 0.043/07/09/96 Prior to the Hotel Opening Date: MB Redevelopment, Inc. 407 Lincoln Road Suite 6-K Miami Beach, Florida 33139 Attention: Eric Nesse After the Hotel Opening Date: MB Redevelopment, Inc. c/o Loews Miami Beach Hotel General Manager 1601 Collins Avenue Miami Beach, Florida 33139 in each case with a copy to: Loews Hotels Holding Corporation 667 Madison Avenue New York, New York 10021 Attention: Corporate Secretary and to: Hughes, Hubbard & Reed 201 S. Biscayne Boulevard, Suite 2500 Miami, Florida 33131 Attention: William A. Weber, Esq. 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 - 11 - 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 and with a copy to: Squire, Sanders & Dempsey Two Renaissance Square Phoenix, Arizona 85004 Attention: Richard F. Ross, Esq. Any Notice may be given, in the manner provided in this Section, (A) on either party's behalf by its attorneys designated by such party by notice hereunder, and (B) at Hotel Owner's request, on its behalf by any Recognized Mortgagee designated in such request. (b) Effectiveness. Every Notice 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. (c) References. All references in this Agreement to the "date" of Notice shall mean the effective date, as provided in the preceding subsection (b). (d) Effect of Granting or Failure to Grant Approvals or Consents. All consents and approvals which may be given under this Agreement shall, as a condition of their effectiveness, be in writing. The granting by a party of any consent to or approval of any act requiring consent or approval under the terms of this Agreement, or the failure on the part of a party to object to any such action taken without the required consent or approval, shall not be deemed a waiver by the party whose consent was required of its right to require such consent or approval for any other act. (e) Standard. Unless expressly stated otherwise, all consents and approvals which may be given by a party under this Agreement shall not be unreasonably withheld or conditioned by such party and shall be given or denied within the time period provided, and if no such time period has been provided, within a reasonable time. Upon disapproval of any request for a consent or approval, the disapproving party shall, together with Notice MI96191 0.043/07/09/96 - 12 - of such disapproval, submit to the requesting party a written statement setting forth with specificity its reasons for such disapproval. 13. LIABILITY. (a) Limitation. Except as such liability may be eliminated or reduced by any constitutional, statutory, common law or other protections afforded to public bodies or governments, including, but not limited to, sovereign immunity statutes, the liability of the Owner for damages or otherwise, arising out of or in connection with any breach of this Agreement or any injury (whether physical (including death) economic or otherwise) incurred in connection with this Agreement, shall be limited to the amount of $10,000,000. As used in the preceding sentence, the terms "breach" and "injury" shall include all breaches and injuries arising out of the facts and circumstances resulting in such breach or injury. (b) Owner's Exculpation. Except for conversion, fraud or willful misconduct (and then only to the extent such party acted in its proprietary capacity as opposed to its governmental capacity), none of the Owner Indemnified Parties (except as provided in subsection 13(a)) shall have any liability (personal or otherwise) hereunder. (c) Hotel Owner's Exculpation. Except for Hotel Owner's liability for conversion, willful misconduct or fraud, the liability of Hotel Owner under this Agreement and with respect to the Premises for damages or other monetary amounts shall be limited to Hotel Owner's interest in the Premises, and no other property or assets of Hotel Owner shall be subject to levy of execution or enforcement procedure for the satisfaction of Owner's remedies hereunder or any other liability of Hotel Owner arising from or in connection with this Agreement or the Premises. Except in the case of conversion, fraud or willful misconduct, (i) none of the Hotel Owner Indemnified Parties (as defined in the Lease for "Tenant Indemnified Parties" with the references to "Tenant" in such definition being references to "Hotel Owner") (except as provided above) shall have any liability (personal or otherwise) hereunder, and (ii) no property or assets of any Hotel Owner Indemnified Party (except as provided above) shall be subject to levy of execution or enforcement procedure for the satisfaction of Owner's remedies hereunder or any other liability of Hotel Owner arising from or in connection with this Agreement. Nothing contained herein shall be deemed a waiver of any equitable remedies available to Owner. 14. INDEMNIFICATION AND DEFENSE OF CLAIM. (a) Indemnification. (i) The Owner shall indemnify and hold the Hotel Owner Indemnified Parties harmless from all loss, cost, liability, claim, damage and expense (including reasonable attorneys' fees and disbursements), penalties and fines, incurred in connection with or arising from any acts, omissions or negligence of the Owner made in its proprietary capacity or any Person claiming through or under the Owner (in its proprietary capacity MI961910.043/07/09/96 - 13- only), or of the contractors, agents, servants, employees, guests, invitees or licensees of the Owner (in its proprietary capacity only) or any Person claiming through or under such Person, in, about or concerning the Convention Center either prior to, during, or after the expiration of, the Term, except to the extent any of the foregoing is caused by the gross negligence or willful misconduct of any of the Hotel Owner Indemnified Parties. (ii) Hotel Owner shall indemnify and hold the Owner Indemnified Parties harmless from all loss, cost, liability, claim, damage and expense (including reasonable attorneys' fees and disbursements), penalties and fines, incurred in connection with or arising from any acts, omissions or negligence of the Hotel Owner, in, about or concerning the Convention Center either prior to, during, or after the expiration of, the Term, except to the extent any of the foregoing is caused by the gross negligence or willful misconduct of any of the Owner Indemnified Parties. (b) Contractual Liability. (i) The obligations of Hotel Owner under this Section 14 shall not be affected in any way by the absence of insurance coverage, or by the failure or refusal of any insurance carrier to perform an obligation on its part under insurance policies affecting the Hotel; provided, however, that if the Owner actually receives any proceeds of Hotel Owner's insurance with respect to an obligation of Hotel Owner under this Section, the amount thereof shall be credited against, and applied to reduce, any amounts paid and/or payable hereunder by Hotel Owner with respect to such obligation. (ii) The obligations of the Owner under this Section 14 shall not be affected in any way by the absence of insurance coverage, or by the failure or refusal of any insurance carrier to perform an obligation on its part under insurance policies affecting the Convention Center; provided, however, that if Hotel Owner actually receives any proceeds of the Owner's insurance with respect to an obligation of the Owner under this Section, the amount thereof shall be credited against, and applied to reduce, any amounts paid and/or payable hereunder by the Owner with respect to such obligation. (c) Defense of Claim, Etc. (i) If any claim, action or proceeding is made or brought against any Owner Indemnified Party by reason of any event to which reference is made in subsection 14(a)(i), then, upon demand by the Owner or such Owner Indemnified Party, Hotel Owner shall either resist, defend or satisfy such claim, action or proceeding in such Owner Indemnified Party's name, by the attorneys for, or approved by, Hotel Owner's insurance carrier (if such claim, action or proceeding is covered by insurance) or such other attorneys as the Owner shall reasonably approve. The foregoing notwithstanding, such Owner Indemnified Party may at its own expense engage its own attorneys to defend such Owner Indemnified Party, or to assist such Owner Indemnified Party in such Owner Indemnified Party's defense of such claim, action or proceeding, as the case may be. MI96191 0.043/07/09/96 - 14- (ii) If any claim, action or proceeding is made or brought against any Hotel Owner Indemnified Party by reason of any event to which reference is made in subsection 14(a)(ii), then, upon demand by such Hotel Owner Indemnified Party, the Owner, or any successor the Owner, or any successor the Owner, as applicable, shall either resist, defend or satisfy such claim, action or proceeding in such Hotel Owner Indemnified Party's name, by the attorneys for, or approved by, the Owner's insurance carrier (if such claim, action or proceeding is covered by insurance) or by such other attorneys as Hotel Owner shall reasonably approve. The foregoing notwithstanding, such Hotel Owner Indemnified Party may at its own expense engage its own attorneys to defend such Hotel Owner Indemnified Party, or to assist such Hotel Owner Indemnified Party in such Hotel Owner Indemnified Party's defense of such claim, action or proceeding, as the case may be. (d) Notification and Payment. (i) Each Owner Indemnified Party shall promptly notify Hotel Owner of the imposition of, incurrence by or assertion against such Owner Indemnified Party of any cost or expense as to which Hotel Owner has agreed to indemnify such Owner Indemnified Party pursuant to the provisions of this Section 14. Hotel Owner agrees to pay such Owner Indemnified Party all amounts due under this Section 14 within sixty (60) days after receipt of the notice from such Owner Indemnified Party. (ii) Hotel Owner or each Hotel Owner Indemnified Party shall promptly notify the Owner of the imposition of, incurrence by or assertion against such Hotel Owner Indemnified Party of any cost or expense as to which the Owner has agreed to indemnify Hotel Owner or such Hotel Owner Indemnified Party pursuant to the provisions of this Section 14. The Owner agrees to pay Hotel Owner Indemnified Party all amounts due under this Section 14 within sixty (60) days after receipt of the notice from such Hotel Owner Indemnified Party. (e) Governs Agreement. The provisions of this Section shall govern every other provision of this Agreement. The absence of explicit reference to this Section in any particular provision of this Agreement shall not be construed to diminish the application of this Section to such provision. (f) Term. Survival. The provisions of this Section shall survive the expiration of the 15. INVALIDITY OF CERTAIN PROVISIONS. If any provision of this Agreement or the application thereof to any Person or circumstances is, to any extent, finally determined 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. MI961910.043/07/09/96 - 15- 16. SUCCESSORS. This Agreement shall automatically transfer with the transfer of any ownership interest in the Hotel by Hotel Owner or its successors; provided, however, that the transferee or assignee shall succeed, for the period of its ownership of the Hotel, to the rights, and assume the obligations of, Hotel Owner hereunder. 17. NO THIRD PARTY RIGHTS. Nothing in this Agreement, express or implied, shall confer upon any Person, including Convention Center or GMC&VB, other than the parties hereto and their respective successors and assigns, any rights or remedies under or by reason of this Agreement; provided, however, that a Recognized Mortgagee or its Designee shall be third party beneficiaries hereunder to the extent same are granted rights hereunder. 18. NO DISCRIMINATION. The Owner and Hotel Owner agree that they will not discriminate upon the basis of race, creed, color, national origin or sex. 19. APPLICABLE LAW. This Agreement and the rights and obligations of the parties hereunder shall be governed by the law of Florida and the courts of Dade County, Florida shall be the proper venue for any dispute arising hereunder. 20. ENTIRE AGREEMENT; NO WAIVER. This Agreement, together with the attachments hereto, contains all of the promises, agreements, conditions, inducements and understandings between Hotel Owner and Owner concerning the subject matter hereof, and there are no promises, agreements, conditions, understandings, inducements, warranties or representations, oral or written, express or implied, between them with respect to the subject matter hereof other than as expressly set forth herein and in such attachments hereto. Notwithstanding anything to the contrary set forth in this Agreement, the terms of this Agreement shall supersede the terms of that certain Letter of Intent with respect to the development and operation of the Improvements dated May 3, 1995, executed by the Agency, the Owner, St. Moritz Hotel Corp. (as predecessor in interest to Hotel Owner) and Loews Hotel Holding Corporation, and any replacements, substitutions, restatements or amendments thereof. 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 Hotel Owner and the Owner. No waiver of any default shall affect or alter this Agreement, but each and every covenant, agreement, term and condition of this Agreement shall continue in full force and effect with respect to any other then existing or subsequent default thereof. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together shall represent one instrument. 21. RECORDATION. The Owner shall have no right to record this Agreement or a memorandum thereof in the Public Records of Dade County, Florida. 22. UNAVOIDABLE DELAY. The times for performance set forth in this Agreement (other than for monetary obligations of a party) shall be extended to the extent MI96191 0.043/07/09/96 - 16- performance is delayed' by Unavoidable Delay, except as otherwise expressly set forth in this Agreement. An "Unavoidable Delay" has the meaning provided in the Lease. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in their names by their duly authorized representatives and delivered as their act and deed, intending to be legally bound by its terms and provisions. By: Name: Title: ATTEST: By:~ob+ PQA~ Robert Parcher City Clerk MI96191 0.043107/09/96 HOTEL OWNER MB Redevelopment, Inc., a Florida corporation By: Na Titl : Q?v-f- OWNER City of Miami Beach, a Florida municipal corporation Gelber, FORM APPROVED LEGAL DE T. By Date -17 -