HomeMy WebLinkAboutR-01-1001J-0'1-8.30
9/24/01
RESOLU'T'ION NO.
A RESOLUTTON OF THE MIAMI CITY COMMISSTON
CONSENTING '20 THE T -'RMS OF TWO PROPOSEI)
SUBLEASES BETWEEN ',HE MIAMI SPORTS AND
EX11TBITION AUTHORI'l Y AND FLYING BOAT, INC. ,
("CHALKS") FOR TERMINAL SPACE AND WITH BIMINI
LANDING, INC., AN AFFILIATE OF CJA1XS, FOR A
FOOD AND BEVERAGE OPERA'T'ION, IN THE AIR
TRANSPORTATION FACILITY AND REGIONAL VISITORS
CENTER TO BE DEVELOPED ON WATSON ISLAND, A1,11)
FURTHER AU'T'HORIZTNG TIES CITY MANAGER TO
EXECUTE A SETTL_EMENT AGREEMENT WTTH CHALICS,
TN SUBSTANTIALLY THE ATTACHED FORM, TO
RELEASE ALL ALLI=GED CLATMS AND RESOLVE ALL
MATTERS RIsf.ATING TO TITLE AND POSSESSORY
RTGHTS ON A POR'T'ION OF WATSON 1S1,A1,J1D, IN
SUBSTAN`T'IALLY THE ATTACHED FORM.
WHEREAS, Flying Boat:, Inc., a Florida corporation d/b/a
Chalks Ocean Airways ("Chalks") and its predecessors have
operated a seaplane airline service on the southwesterly portion
of Watson Is_Land for more than 50 years; and
WHEREAS, in 1989, the City filed a lawsuit in Circuit Court
=or_ ejectment, to quiet title and for other relief from Chalks;
and
WH ERR.AS, on June 13, 1989, the parties executed a
Stipulation of Voluntary Dismissal Without: Prejudice by which the
parties agreed not to litigate tho issues raised in the e-iect:ment
ow COMM881411
NEE1WO OF
SEP 71 5 2001
Llesalution Wo.
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action, nor do anything to increase or enhance the:i.r claims, for
a period of 10 years; and
WHEREAS, on August 14, 1997, the City and Miami Sports anis
Exhibition Authority (MSEA) entered into an InLerl.ocal Agreement
for the purpose of developing, operating and managing an Air
Transportation Facility arld Regional Visitors Center on
approxLatateiy 5.6 arses on Watson Island; and
WHERF.AS, the City would like Chalks to be an integral part
of the Air Transportation-acil.it.y and Regional Visitors Center;
and
WHEREAS, pur'suanL to the Interlocal. Agreement, all subleases
to be entered into by MSFA are subject to the City's prior
writ Len conser:L; ar.d
WHEREAS', it is necessary to resolve all outstanding disputes
between the City and Chalks before the development of the Air
Transportation Facility and Regional. visitors Center may take
place; and
WFiFREAS, the City Commission determines it to be in the best--
interest
est:interest of the C.i.ty to cot:sent to the sub- Leases between MSEA and
Chalks for terminal. space and with Chalks' affiliate, for food
and beverage services, in t_he Air Transporration Faci.lit:y and
Regional Visitors Center., in substantially the attached terms,
and to enter into a settlement agreement with Chalks, in
substantial -1y the attached form, which provides, among other
things, that (i) if the Interlocal Agreement: is voided or
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Page' 2 of 4 U'.1 Jl301.
terminated, the City will cl ow Chalks to continue to occupy the
property under the terms of the subleases, and (ii) if the terms
of the settlement fail in their essential elements, the parties
will. return to the position existing as of the date of the
settlement agreement.
NOW, THEREFORE, BF IT RESOLVED BY THE COMMISSION OF THE CITY
OF MIAMI, FLORIDA:
Section 1. The recitals and findings contained in the
Preamble to this Resolution are adopted by reference and
incorporated as if fully set forth in this Section.
Section 2. The City Commission hereby consents to the
Miami Soorts and Exhibition Authority entering inL.o a sublease
with Chalks for terminal space and a sublease with Bimini
Landing, Inc., a Florida corporation, an af-filiate of Chalks,
for food and beverage operations, on substantially the attached
business terms, and authorizes the City Manager to execute such
documents as may be necessary to evidence the City's consent,
subject to the approval of the City Attorney.'/
Section. 3. The City Manager is authorized/ to execute a
setIlement agreement, in substantially the attached form, with
Flying Boat, Inc., a Florida corporation, d/b/a Chalks Ocean
Airways ("Chalks"), and such other documents as may be approved
The herein authorizatior is further sub sect to con.ipli ance with all
requiremenr.s ghat may be imposed by L}ie City Attorney, i.ncludiny buL r.oL
limited to those prescribed by applicable Ci Ly Charger and Code
nrov'_sions.
Page 3 of 4
r-
by the City Attorney, in connection Lherewi_th, for the release
of claims and to resolve all matters relating to title and
possessory rights on a portion of Watson Island.
Section 4. This Resolution shall become effective
.iminediate.l.y upon its adoption arid signature of the Mayor.`'
PASSED AND ADOPTED this 25th day of September , 2001,
JOE CAROIJ...O, MAYO—R---"-----
In
AYORT
In accordance with Miami Code Sec. 2-33, since the Mayor did not indicate spprovol of
this legislation by signing it in the designated p provided, Paid legislation now
becomes effective with the elapse of ten (10 day m the da o mmis ' cci;o,i
ATTEST: regarding same, without the Mayor eaerC' ins off,
UE
WALTER J. FOEMAN
CITY CLERK _
APPR?�6 �1Sf TO F'ORyI AND CORRECTNESS el
/4E J '1` II�VILAT�ET.,LO
r'
756 -/
ATTORNEY
l:ORS:LB
=� If Che Mayor does noL sign this Resolution, it shall become effective aL
t:he and of ton ca.londar days from the dt t��
ate i.tas passed and adapted. If
tine Mayor vetoos this Resolution, iL shall become. effective immediately
upon over.ricie of the veto by Lhe City Comm:isr ion.
Page 4 of 4 - �. 0 �► �1.
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SETTLEMENT AGREEMENT
i�
This Settlement Agreement ("Agreement") is dated as of the,
_ day of 2001, by and between the City of
Miami, Florida, a Florida nuinici.pal corporation ("City") and
F.1yi.ng Boat, Inc., a I--'lorida corporation d/b/a Chalks Ocean
Airways ("ChaI ks" )
PRE.Ia1:VINARY STATEMENTS
A. The City -is the owner of the proporty known as Watson
Ts -,and located in the City of Miami, Miami -Dade County, 11.10rida.
3.
Chalks and its
corporate predecessors
have operated a
seaplane
airl:..ne service
on t:he southwesterly portion
of Watson
Island (tile
"Pz:operty")
for more than fifty (50)
years and claim
certain
right -.5 to r..he
Property, which property
includes r.aTnps,
aprons,
maintenance area,
a terminal building
and facilities
housing
governmental functions such as Customs
and Immigration
(the "E•,'xi.sting
Seaplane
Facility") Located thereon.
C. In 1989, t:te City instituted an action styled CiLy of
Miami vs. Chalks international Airlines, Tnc.,_ Case 10. 89-7029
CA (19) in the Circuit. Court of the 1.1th �J'udic.ial. Circuit i.n and
for Dade County, Florida, for ejectment, to quiet, titie and for
other relief against the defendant, a predecessor. of Chalks, as
the operator of. the Existing Seaplane Fac.i -1 ity (the "l-jectment
Action") . On June 1_`1 1989, the plaintiff. and defendant: in such
action executed a Stipulation of Voluntary Dismissal. Without
Prejudice (the "Standstill Agreement"), by which the parties
agreed, subject to the provisions contained therein, not to
li.tigat:e the issues raised in the Ejectment Action for a period
of ren years from tiro date of the Stipulation, which pe.rioc-1
expired on June 13, 1999. 'fire Ejectment Action and the
Standst i. 1.1 Agreement are referred to herein, collectively, as
the "T,awsu:i_t".
D. Pursuant to the City's Resolution No. 9-/-420, adopted
June 26, 1.997, the City entered into an Tn;.erl ocal Agreement
(the "Interlocal. Agreement") with the: Mi.am.i Sports and
Exh:-bition Authority, an independent-. and autonomous agency and
inst--rumentality of tho City ("MSF'A") dated as of August. 14,
1.997, providing for the development, operation and management of
an ai.r transportation facil.i ty, regional vis i tors center.- and
related facilities on a portion 0f Watson island, and
i.nc:orporat_ing a .tease to MSNA of approximately 5.6 acres, which
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includes the Property on which the Existing Seaplane Facility is
currently being operated. Pursuant to the Interlocal Agreement,
MSEA has the authority to sublease and gran- licenses and
concessions .for purposes,permitted by the Interlocal. Agreement.
E.
The City,
MSEA and Chalks have
negotiated an
air
terminal.
sublease
(the "Terminal Sublease")
and a food
and
beverage
sublease
with an affi.Iiate of
Chalks ("Food
arid
Beverage
Sublease")
subject to the City and
Chalks settling
and
resolving
all of their disputes under, or
relating Lo,
the
Lawsuit.
The Air_
Terminal Sublease and
rood and Beverage
Sublease
may be collectively
referred to herein as the "Chalks
Agreements"
1,. The City and Chalks have agreed to resolve herein all.
of their disputes, claims or controversies under. the Lawsuit,
their respective rights to the Property and the Existing
Seaplane Facility and all related matters.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and obligations set forth herein, the City and
Chalks agree as follows:
Effective Date: The "Effective Date" of. this
Settlement Agreement shall be the date on which all of: the
following condi Lions are satisfied: (i) the Chalks Agreements
have been approved by the Board of Directors of Chalks and of
the Miami. Sports and Exhibition Authority, and the Commission of
the City of Miami has consenL-ed to the Chalks Agreements and the
Nondisturbance provided in paragraph 32 thereof, (ii) the Chalks
Agreements are fully executed, and the Consent to the Chalks
Agreements and Nondisturbance Agreement related thereto has been
executed by the City (iii) and the City and Chalks have executed
mutual releases and covenant not to sue regarding all matters or
actions under or relating to the Lawsuit, Chalks' adverse
possession claim, the Existing Seaplane Facility, the Property,
Watson Island, and any other matter occurring prior to the date
hereof.
2. Covenant of the City: The City acknowledges that this
settlement is predicated upon Chalks being permitted to occupy
and use the property being leased under the Chalks Agreements,
in accordance with the terms of the Chalks Agreements.
Therefore, in the event that any of the Chalks Agreements are
terminated as a result of a default by MSEA under either of the
Chalks Agreements, or the Interlocal Agreement or by the City
under_ the Inter.l.ocal Agreement or by a judicial determination
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�f-100f
that: the Interlocal. Agreement or either or both of the
Chalks
Agreements is invalid, i.l.legal or unenforceable, then
Chalks
shall continue to occupy the property, as defined in the
Chalks
Agreements, undisLurbed and pursuant to all. of the terms and
conditions, and for the remainder of the term, set forth
in the
Chalks Agreements, and all of the rights and obligations
of MSEA
thereunder shall be binding upon, and inure to the benefit
of,
zhe City 1n the event of a judicial dererminati.on :hat this
Settlement Agreement is invalid or that: City dial riot have the
right to agree to grant Chalks possession and occupancy
of the
Property under the Lerms hereof, then the rights of the
parties
hereto shall be restored to the condition existing as
of the
date of th]s Settloment Agreement, and nothing herein shall be
construed as a waiver of any rights or admissions
against
interest by either_ party in connection with a1..1.
matters
pertaining to thy., Lawsuit.
3. Expiration Date: Unless otherwise extended by written
agreement of the parties, this Settlement Agreement shall expire
if all of the condi Lions set: forth in Section 1 above have not
been satisfied within Lhree (3) months from the dare hereof,
whereupon the rights of :he parries hereto shall be restored to
the condition existing as of the da Le of this Settlement
Agreement and nothing herein shall be construed as a waiver of
any rights or admissions against interest by either party in
connection with all matters pertaining to thn Lawsuit.
4. Successors and Assigns: This Agreement shall be
binding upon the parties hereto, and their respect::i.ve successors
or assigns.
5. Koval by the_Oversight Board: The State of
Florida has appointed an Emergency Financial Oversight Board
(the "Oversight Hoard") which is empowe.r.od to review and approve
all pending City of Miami contracts. As a result, contracts
shall not be binding on the City until such time as they have
been approved by the Oversight Board. Attestation of this
SetLlement Agreement by the City Clerk shall constitute evidence
of approval by the Oversight; Board.
IN WITNESS WHEREOF, City and have executed this Agreement
as of the date first set forth above.
Attest: City of Miami, a municipal
corporation of the State of
Florida
HY'- - - --- BY:
WaiLer F'oeman Carlos A. Gimenez
City Clerk City [tanager
Attest.. Flying Boat, Inc., a Florida
corporation
B y :
Secretary James Confal.one
President
0i-•10
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TERM SHEET
Watson island Air Transportation Facility
Food and Beverage Service Sublease
Landlord: Miami Sports and Exhibition Authority, Inc
Tenant: Bimini Landing, Inc. (an affiliate of Flying Boat, Inc. d/b/a
Chalks Ocean Airways)
Description of Premises: approximately 1,443 sq. ft. of indoor table, bar,
food storage and preparation and related space on the first floor of the building
and approximatelyl,500 sq. ft of outdoor terrace area where the tenant may install
tables and chairs for its customers' use.
Commencement Date: upon issuance of a temporary certificate of
occupancy for the building.
Term: 30 years from Commencement Date, with the right to extend for
two additional terms of ten years each, if permitted by law at that time, but
expiring no later than the expiration date of Ute Watson Island Interlocal
Agreement.
Rent: $20 per sq, ft. for the indoor space, which includes au estimated
$4.80 per sq. ft. building operations and maintenance ("O&M") cost component,
an estimated $8.54 per sq. ft. direct airport O&M cost component, a $2.98 per sq.
ft. PILOT for indirect airport O&M costs, and an estimated $3.68 base rent.
During the first five years, Tenant receives a partial credit against direct O&M
expenses of $11,850 during years 1-3 of the term and $9,480 during years 4 and 5
of the teen.
Rent escalations: Base rent and the PILOT escalate by the CPI, with a
{door of 3% and a ceiling of 5%. Building O&M and Direct Airport O&M
expenses shall be adjusted based upon actual expenditures.
Percentage Rent: 8% of gross sales over $300,000 but less than
$500,000; 10'% of gross sales of $500,000 or more.
Guaranty: by .lames Confalone, individually, for the first five years of
the term.
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CITY OF MIANII, FLORIDA 10
INTER -OFFICE MEMORANDUM
The Honorable Mayor and Members
TO of the City Commission GATE September 19, 2001 FILE
REC MMENDATION:
Chalks Ocean Airways
SUBJECT:
REFERENCHS
ENGLOSURFS
The administration recommends that the City Commission adopt the attached Resolution
consenting to the terms of two proposed subleases between the Miami Sports and Exhibition
Authority and Flying Boat, Inc. ("Chalks") for terminal space and a food and beverage operation
in the air transportation facility and regional visitors center to be developed on Watson Island.
The Resolution further authorizes the City Manager to execute a settlement agreement with
Chalks to release all alleged claims and resolve all matters relating to title and possessory rights
on a portion of Watson Island.
BACKGROUND:
On August 14, 1997, the City and MSEA entered into an Interlocal Agreement for the purpose of
developing, operating and managing an Air Transportation Facility and Regional Visitors Center
on approximately 5.6 acres on Watson Island which use was already determined by the Board of
Trustees of the Internal Improvement Trust Fund to be in consistent with the deed restriction
affecting Watson Island. The term of the Interlocal Agreement is for 45 years that shall expire on
August 13, 2042. The City, at its sole option, may extend the Interlocal Agreement for any.
- increment of years, for an additional 20 years. The terms of the Interlocal Agreement require that
all subleases be consented to by the City Commission.
The City would like Chalks to be an integral part of the new aviation facility. Chalks has
operated a seaplane airline service on the southwesterly portion of Watson Island for more than
50 years. In 1989, the City filed a lawsuit in Circuit Court for ejectment, to quiet title and for
other relief from Chalks. On June 13, 1989, the parties executed a Stipulation of Voluntary
Dismissal Without Prejudice by which the panties agreed riot to litigate the issues raised in the
ejectment action, nor do anything to increase or enhance their claims, for a period of 10 years.
In order for the development of the Air Transportation Facility and Regional Visitors Center to
take place, it is necessary for the City and Chalks to resolve outstanding disputes.
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The Honorable Mayor and Members
Of the City Commission
Page 2
At this time, the administration has negotiated a settlement agreement with Chalks to provide for
a release by the parties of all alleged claims and resolve all matters relating to title and possessory
rights on a portion of Watson Island. The settlement agreement will not take effect until the
following conditions are satisfied:
1. A negotiated sublease for an air terminal and a sublease for food and beverage service
(collectively the "Chalks Agreements") are approved by Chalks, the City Commission
and MSEA;
2. The Chalks Agreements shall have been fully executed.
A copy of the business terms for each of the subleases is attached hereto for reference.
CAG:DB:L'S:m CC Settlement
�:1.-1.00j.
rm Sheet
Sublease Agreement for Terminal Space between the.
Miami Sports and Exhibition Authority (Landlord)
And
Flying Boat, Inc. (d/b/a Chalks Ocean Airways) (Tenant)
Definition of Phases
The Sublease Agreement is broken down into three phases in order to ensure Tenant will
continue to be able to operate at Watson Island. These phases are broken down as
foilows:
Phase P Pre -construction Phase
This is the period of time from the Effective Date of the Sublease through the earlier of (i)
the date the Landlord's Facility or Tenant's Facility, as applicable, is built, or (ii) the date
the Tenant terminates the Sublease as provided in the Sublease.
Phase R.- Landlords Facility
This is a period of 30 years commencing on the date the Landlord's Facility is built. The
Landlord's Facility is a two story building located on the property with an adjacent
exterior terrace which includes Terminal Space, approximately 1,443 square feet of space
for food and beverage service pursuant to a Sublease with Tenant's affiliate, the Seaplane
Operations Area and adjacent helipad and Airside Capital Improvements.
Phase Ill,• Tenant's Facility
In the event the Landlord does not build Landlord's Facility and Tenant does not
terminate the Sublease, Tenant will construct a new terminal facility including airside
improvements at Tenant's sole cost and expense. Tenant shall be required to spend at
least $1,000,000 in connection with Tenant's Facility. Phase III shall be a period of 30
years commencing on the date the Tenant's Facility is built.
Property
Phase I: Approximately 2.4 acres
Phase II: Approximately 1,602 sf of office, counter, gift shop and passenger
terminal space located in the southeast portion of the first floor of the
building
Phase III: Approximately 2.4 acres
6g-1001 1
use
Option
Rent
Phase 1:: Ticketing for seaplane operations, waiting room, vending machines, a taxi
stand, incidental sale of merchandise/memorabilia, Government Service
areas, freight and baggage area, seaplane aircraft operations and
administrative office space for the operation of Tenant's seaplane
operation. Tenant shall not be permitted to sell aircraft fuel to unaffiliated
third parties.
Phase II: Same uses as Phase I plus Tenant shall be entitled to operate a gift shop
and may provide to third party aircraft owners (i) tie down services for
seaplanes and light aircraft maintenance; and (ii) if Tenant constructs a
Fuel Farm, sale of aircraft fuel.
Phase III: Tenant shall have the right to the Phase I and II Uses plus food and liquor
service, hotel courtesy van pickup, telephone rental and car rental services,
and light aircraft maintenance.
To the extent permitted by law, Tenant shall have the right to extend the term for two (2)
successive extension terms of ten (10) years each. Neither additional term shall extend
beyond the term provided in the Interlocal Agreement between the City and the MSEA.
Phase I: $30,000/year payable in equal monthly installments of $2,500
Phase II: $4.80 sf Building O&M
$8.54 sf Direct Airport O&M
$2.98 sf Indirect Airport O&M (PILOT)
$3.68 sf Base Rent
Building O&M and Direct Airport O&M shall be increased or decreased
based upon actual expenditures
Indirect Airport O&M and Base Rent shall be subject to an annual CPI
adjustment
Percentage Rent:
(i) 50% of any landing or tie -down fees
(ii) 5% of gross revenue from sale of fuel to unaffiliated third party
During the first five years of the Term, in order to permit Tenant to
establish and stabilize its operations, Landlord will credit Tenant against
all O&M Expense components of Rent the following sums:
Year Credit Against Rent
Years 1-3, inclusive $13,150.00
Years 4 and 5, inclusive $10,520.00
Phase III: $0.30 sf of the land; said amount shall be subject to an annual CPI
adjustment
Percentage Rent:
(i) 5% of gross revenue from sale of fuel to unaffiliated third party
(ii) 8% of food and beverage gross sales over $300,000
10°/a of food and beverage gross sales over $500,000
Parking
If Landlord's Facility is constructed, Landlord shall provide Tenant, without charge, 8
parking spaces in close proximity to the building. In either Phases II or III, Landlord will
provide or cause to be provided additional parking on or adjacent to the property.
Payment for such parking spaces shall be on an "as -used" basis. Rates for such use shall
be not more than prevailing market rates for long term parking.
Tenant's Right to Terminate
If Landlord (i) has not commenced construction of the Landlord's Facility by the fifth
anniversary of the Execution Date of the Sublease or (ii) delivers written notice to Tenant
prior to such fifth anniversary that it has elected not to construct the Landlord's Facility,
Tenant shall commence development of the Tenant's Facility, unless, within 120 days
after Tenant's receipt of such notice or such fifth anniversary, Tenant notifies Landlord
that it has elected to cancel the. Sublease, If such notice of termination is given, the
Sublease shall end 180 days after delivery of Tenant's notice of termination.
Guaranty
James Confalone, individually, for five years from the Commencement Date.
3
TERM SHEET
Watson Island Air Transportation Facility
Food and Beverage Service Sublease
Landlord: Miami Sports and Exhibition Authority, Inc.
Tenant: Bimini Landing, Inc. (an affiliate of Flying Boat, Inc. d/b/a
Chalks Ocean Airways)
Description of Premises: approximately 1,443 sq. ft. of indoor table, bar,
food storage and preparation and related space on the first floor of the building
and approximately 1,500 sq. ft of outdoor terrace area where the tenant may install
tables and chairs for its customers' use.
Commencement Date: upon issuance of a temporary certificate of
occupancy for the building.
Term: 30 years from Commencement Date, with the right to extend for
two additional terms of ten years each, if permitted by law at that time, but
expiring no later than the expiration date of the Watson Island Interlocal
Agreement.
Rent: $20 per sq. ft. for the indoor space, which includes an estimated
$4.80 per sq. ft. building operations and maintenance ("O&M") cost component,
an estimated $8.54 per sq. ft. direct airport O&M cost component, a $2.98 per sq.
ft. PILOT for indirect airport O&M costs, and an estimated $3.68 base rent.
During the first five years, Tenant receives a partial credit against direct O&M
expenses of $11,850 during years 1-3 of the term and $9,480 during years 4 and 5
of the term.
Rent escalations: Base rent and the PILOT escalate by the CPI, with a
floor of 3% and a ceiling of 5%. Building O&M and Direct Airport O&M
expenses shall be adjusted based upon actual expenditures.
Percentage Rent: 8% of gross sales over $300,000 but less than
$500,000; 10% of gross sales of $500,000 or more.
Guaranty: by James Confalone, individually, for the first five years of
the term.
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