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HomeMy WebLinkAboutPre-LegislationCity of Miami Legislation Resolution R-17-0261 City Hail 3500 Pan American Drive Miami, FL 33133 www.miamigov.com File Number: 2029 Final Action Date: 5/25/2017 A RESOLUTION OF THE MIAMI CITY COMMISSION, WITH ATTACHMENT(S), AUTHORIZING AND DIRECTING THE CITY MANAGER TO EXECUTE A RECONCILIATION AGREEMENT ("AGREEMENT"), IN SUBSTANTIALLY THE ATTACHED FORM, BETWEEN THE CITY OF MIAMI ("CITY") AND HYATT EQUITIES, L.L.C. ("HYATT"), WHEREBY THE CITY SHALL FINALIZE SEVERAL PENDING DISPUTES BETWEEN THE CITY AND HYATT, WITH TERMS AND CONDITIONS MORE PARTICULARLY DESCRIBED IN THE ATTACHED AGREEMENT; FURTHER AUTHORIZING THE CITY MANAGER TO MAKE REVISIONS AND NON -SUBSTANTIVE AMENDMENTS TO SUCH AGREEMENT, IN A FORM ACCEPTABLE TO THE CITY ATTORNEY, AS NEEDED FOR SAID PURPOSE. WHEREAS, the City of Miami ("City") is the owner of the James L. Knight Convention Center located at 400 Southeast 2nd Avenue, Miami, Florida ("Convention Center"); and WHEREAS, per the Lease Agreement originally dated September 13, 1979, as supplemented and amended ("Lease"), Hyatt Equities, L.L.G. ("Hyatt"), the owner of the hotel structure known as the Hyatt Regency Miami located at 300 Southeast 2nd Avenue, Miami, Florida ("Hotel"), currently leases the property connected to the Convention Center from the City; and WHEREAS, the City and Hyatt have various disputes between them, including, but not limited to, fire alarm system upgrades, tile repairs, concession fees, maintenance costs, cooling tower and chiller replacement, and depreciation costs; and WHEREAS, the City and Hyatt have agreed to resolve, compromise, and settle all of the above -mentioned disputes, claims, and controversies between them, as further specified in the attached Reconciliation Agreement ("Agreement"); and WHEREAS, pursuant to the Agreement, Hyatt shall upgrade the fire alarm system at the Convention Center and Hotel; and WHEREAS, pursuant to the Agreement, Hyatt shall replace the tiles at the outside entryway of the Convention Center and shall further repair any and all water damage to the Hotel and its personal property located on the ground level of the Hotel; and WHEREAS, pursuant to the Agreement, the City shall pay to Hyatt an amount not to exceed Two Million One Hundred Forty -Three Thousand Two Hundred Seventy -Nine Dollars ($2,143,279.00) for the City's portion of the fire alarm system, tile repair, and other life safety issues; and WHEREAS, pursuant to the Agreement, the City shall pay Seven Hundred Seventy - Eight Thousand Seven Hundred Twenty -Two Dollars ($778,722.00) for the City's portion of the disputes regarding the Maintenance Costs and Concession Fees; and City of Miami Page 1 of 2 File ID: 2029 (Revision: B) Printed On: 4/1012018 File ID: 2029 Enactment Number: R-17-0261 WHEREAS, pursuant to the Agreement, the City shall also pay to Hyatt a total amount equal to Eight Hundred Fifty -Four Thousand Three Hundred Dollars ($854,300.00) for the City's portion of the disputes regarding the Chiller Overpayment, the Depreciation Credit, and the Phase I Design Fees; and WHEREAS, the City and Hyatt shall release each other from any and all debts, claims, potential claims, demands, actions, causes of action, potential causes of action, rights, obligations, damages, attorney's fees, costs, and liabilities of any and every kind or nature whatsoever, in law or in equity, past, present, or future, known or unknown, direct or indirect, asserted or unasserted, fixed or contingent, whether contemplated or not, whether based on a tort, contract, contribution, indemnification, or any other type of recovery, and whether for compensatory, consequential, incidental, statutory, punitive, or other damages, which the City or Hyatt have, may have or had related to, arising out of the following claims: (1) Fire Alarm Project, (2) Tile Project, (3) Concession Fees, (4) Maintenance Costs, (5) Other Fees, (6) cooling tower and chiller replacement project including, without limitation, the Chiller Overpayment and the Phase I Design Fees, and (7) depreciation payments including without limitation the Depreciation Credit (collectively, the "Released Claims"), provided, however, that this Release by the City and Hyatt does not release any claims other than the Released Claims; NOW, THEREFORE, BE 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 fully set forth in this Section. Section 2. The City Manager is authorized' to execute the Agreement and all exhibits and attachments, in substantially the attached form, with Hyatt, and further authorized to make any necessary revisions and non -substantive amendments to such Agreement and all exhibits and attachments, in a form acceptable to the City Attorney, as needed for said purpose, Section 3. This Resolution shall become effective immediately upon adoption and signature of the Mayor.2 APPROVED AS TO FORM AND CORRECTNESS: 6/2/2017 " The herein authorization is further subject to compliance with all requirements that may be imposed by the City Attorney, including but not limited to those prescribed by applicable City Charter and City Code provisions. 2 If the Mayor does not sign this Resolution, it shall become effective at the end of ten (10) calendar days from the date it was passed and adopted. If the Mayor vetoes this Resolution, it shall become effective immediately upon override of the veto by the City Commission. City of Miami Page 2 of 2 File ID: 2029 (Revision: 8) Printed on: 4/10/2018 THIS DOCUMENT IS A SUBSTITUTION. ORIGINAL CAN BE SEEN AT THE END OF THIS DOCUMENT. RECONCILIATION AGREEMENT This agreement to reconcile certain disputed issues and provide mutual releases ("Agreement"), is entered into this day of , 2017, between the City of Miami, a Florida municipal corporation, ("City") and Hyatt Equities, L.L.C., a limited liability company doing business in Florida ("Hyatt") (collectively the "Parties"), WHEREAS, the City is the owner of the James L. Knight Convention Center located at 400 S,E. 2"d Avenue, Miami, Florida 33131 ("Convention Center"); and WHEREAS, per the Lease agreement originally dated September 13, 1979, as supplemented, amended and assigned from time to time (collectively, "Lease Documents"), Hyatt currently leases the property adjacent to the Convention Center from the City, and is the owner of the hotel structure known as the Hyatt Regency Miami and located at 300 SE 2"d Avenue, Miami, Florida 33131 ("Hotel"); and WHEREAS, the Parties agree that an upgrade to the current fire alarm system located on the Convention Center property, which supports the Hotel and the Convention Center and the ancillary systems located within each of the Convention Center property and Hotel property (collectively, the "Fire Alarm Project"), is necessary for the proper operation of the Hotel and Convention Center; and WHEREAS, the Parties agree that the tiles, at the exterior of the Convention Center located on the main level at the plaza entrance of the Convention Center along S.E. 2nd Avenue, as described in the documents attached hereto as Exhibit A and made a part hereof (the "Flooring Repair Area"), are in need of replacement and the water damaged areas to the Hotel and its personal property located on the ground level of the Hotel, resulting from the defective tiles, are in need of repair and/or replacement (the "Tile Project") for the proper operation and maintenance of the Hotel and the Convention Center; and WHEREAS, the Parties agree there is an on -going and present dispute regarding the amount of certain concession fees (the "Concession Fees") and other fees related to increased room rental rates, restroom attendant, overtime rates, dtunpster fees and cleaning fees (the "Other Fees") as described in the letter dated November 12, 2012.from Myatt to the City attached hereto as Exhibit B and made a part hereof (the "November 12, 2012 Letter") charged by the City to Hyatt for use of facilities at the Convention Center; and WHEREAS, the Parties agree that there is an on -going and present dispute regarding the amounts owed by each Party to maintain the Physical Plant ("Maintenance Costs") from January, 2012 through the present date; and WHEREAS, the Parties agree that there is an on -going and present dispute regarding the amounts owed for the cooling tower and chiller replacement project undertaken by Hyatt ("Chiller Overpayment") and outstanding credits to Hyatt relating to depreciation payments made by Hyatt pursuant to the Lease Documents ("Depreciation Credit"); and WHEREAS, the Parties agree that there is an on -going and present dispute regarding the amounts owed for certain Phase 1 design fees for the upgrade of the fire alarm system (the "Phase I Design Fees"); and WHEREAS, the Parties intend to redevelop the Convention Center and, in connection therewith, extend Hyatt's lease with the City for the Hotel and modify the Lease Documents to include, among other things, the Convention Center, as otherwise described in that certain Memorandum of Understanding between Hyatt and the City dated , 2017, and attached as Exhibit C (the "Redevelopment") and WHEREAS, the Parties acknowledge and agree to the resolution, compromise and settlement of all such disputes, claims and controversies among them as provided herein; and NOW THEREFORE, in consideration of the mutual promises and covenants set forth herein, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows: 1. Recitals. The Recitals set forth above arc incorporated herein. 2. Agreement Terms, A. City's Contribution. The City shall pay Hyatt Two Million One Hundred Forty -Three Thousand Two Hundred Seventy -Nine Dollars ($2,143,279.00) ("City's Contribution"). The City shall use commercially reasonable efforts to pay the City's Contribution to Hyatt following the execution of this Agreement no later than sixty (60) days from the date hereof. The City shall have no liability or obligation to pay any sum or cost whatsoever in excess of the City's Contribution with respect to the Projects described below, except in the event of an increase in costs due to the action or inaction of the City contrary to the terms of this Agreement or the Lease Documents, delays caused by the City or related parties to the City or force majeure. Hyatt shall have no liability or obligation to refund all or any portion of the City's Contribution even if the costs of the Projects described below are less than anticipated. Except as otherwise_ expressly provided herein, should the total amount of monies required by Hyatt to complete the Projects be (i) in excess of the City's Contribution, Hyatt shall, at its sole cost and/or expense, complete the Projects using Hyatt's independently acquired funds or (ii) below the City's Contribution, all such excess of the City's Contribution shall belong to Hyatt. If the City fails to make the City Contribution payment in accordance with this subsection A, Hyatt may deduct such amount from the next rent payment under the Lease Documents, and each rent payment thereafter, until the full balance of such amount owed by the City to Hyatt has been paid in full. B. Maintenance and Concession Fees. The City shall also pay Hyatt a total amount equal to Seven Hundred Seventy -Eight Thousand Seven Hundred Twenty -Two Dollars ($778,722.00) to resolve the disputes regarding the Maintenance Costs and Concession Fees. If the City fails to make such payment by the time Hyatt's next rent payment under the Lease Documents is due, Hyatt may deduct such amount from the next rent payment under the Lease Documents, and each rent payment thereafter, until the full balance of such amount owed by the City to Hyatt has been paid in full. C. Other Outstanding City Fees. The City shall also pay Hyatt a total amount equal to Eight Hundred Fifty -Four Thousand Three Hundred Dollars ($854,300.00), to resolve the disputes regarding the Chiller Overpayment, the Depreciation Credit and the Phase I Design Fees (the "Outstanding City Amounts"). The Outstanding City Amounts shall be paid by the City to Hyatt in connection with the Redevelopment and any agreements entered into between Hyatt and the City, with respect to the Redevelopment, shall provide for the payment of the Outstanding City Fees to Hyatt. If the Redevelopment is not approved by City Commission and/or by referendum in calendar year 2017, if the agreements with respect to the Redevelopment are not entered into by the City and Hyatt (following approval by City Commission and referendum) on or before December 31, 2018 or discussions between the City and Hyatt regarding the Redevelopment plans otherwise discontinue for any reason, the Outstanding City Amounts shall become immediately due and payable by the City to Hyatt upon written notice from Hyatt to the City. If the City fails to make such Outstanding City Amounts payment to Hyatt within sixty (60) days of receipt of such written notice, Hyatt may deduct such amount from the next rent payment under the Lease Documents, and each rent payment thereafter, until the full balance of such amount owed by the City to Hyatt has been paid in full. D. Projects. Hyatt-s shall complete the Fire Alarm Project and the Tile Project (collectively the "Projects") pursuant to a scope of work and plans and specifications ("Specifications"), and further corresponding to the Flooring Repair Area, determined by Hyatt for the Projects. Additionally, if bonds are required for the Projects per section 255.05, Florida Statutes, as this is City -owned property, Hyatt shall obtain such bonds for the Projects. The Specifications, the selected contractors and the contracts with the respective design, consulting, construction contractors shall not be subject to the City's approval (subject to such contracts complying with the requirements of subsection F below). Hyatt shall provide copies of the Specifications and the final, executed contracts with all consultants and contractors for the Projects. The parties acknowledge and agree that Siemans Industries, Inc. as the contractor, and Rolf Jensen & Associates, Inc., for the design and related work, have been preliminarily selected for the Fire Alarm Project and that Complete Property Service, Inc., as the contractor, and Building Consultants, Ltd., for the design and related work, have been preliminarily selected as the contractor for the Tile Project. Hyatt shall use commercially reasonable efforts to cause the Projects to be performed in a good and workxnanlike manner in accordance with the Specifications and in compliance with all applicable governmental laws, rules, regulations and industry standards. E. Schedule. Hyatt shall use commercially reasonable efforts to cause the Projects to be performed and completed in accordance with a schedule (the "Schedule") that will minimize disruption of the Hotel and Convention Center operations, provided that commencernont of the Projects shall begin within months of the execution and approval of this Agreement (subject to Section 16 below) (the "Commencement Date") and be substantially completed within months of the Commencement Date, subject to extensions due to force majeure, City caused delays, and other events outside of Hyatt's reasonable control. Time is of the essence. In no event shall either Party be liable to the other for consequential, punitive or special damages associated with any delays in the Projects. F. Project Contract Requirements (Including insurance and Indemnification). Any construction contracts and/or other contracts entered into by the Hyatt to complete the Projects, shall (i) provide that such contract may be assigned to the City, subject to Hyatt approval, which shall not be unreasonably withheld, delayed or conditioned (ii) that the City shall be named as an additional insured on all applicable liability policies along with loss payee or co-insured, as applicable, as to property insurance and dual obligee as to bonds, if applicable on this project (iii) that all contractors must be Iicensed, certified, and insured, and all insurance carriers must be rated A- or better, and (iv) such contractor shall indemnify, hold harmless and defend the City, in addition to Hyatt, as set forth in such agreement; however, the City shall not be liable for or a guarantor for the I-lyatt's obligations under such contract. G. Concession Fees; Maintenance Fees. From and after January 1, 2017, through the remainder of the Term under the Lease Documents, Hyatt shall promptly pay the Concession Fees in connection with its rental of meeting space in the Convention Center and as properly invoiced by the City in accordance with the rates set forth in Chapter 53, Section 181 of the City of Miami Code of Ordinances (which currently provides for $100 for a single portable food/beverage concession and $200 for a single permanent food/beverage concession). From and after January 1, 2017, through the remainder of the Tern under the Lease Document, the City agrees that it shall promptly pay its portion of the Maintenance Fees in connection with the maintenance of the Physical Plant in accordance with the Lease Documents and as properly invoiced by Hyatt. H. Reasonable Cooperation. Hyatt and the City shall reasonably cooperate with each other in connection with the Projects stated herein, including, , the City providing reasonable access to the Convention Center during the period of construction and installation of the Projects and coordination of the work so as to minimize disruption to the operation of the Hotel and Convention Center, the City providing reasonable and timely approvals of all permits required for the Projects and the City providing reasonable and timely inspections of the Projects, in accordance with the Schedule, Hyatt shall obtain the City's prior approval of shut downs of power, water, and HVAC, use of loading docks, blockage of circulation areas, and within the Convention Center. If the City does not respond to a request for such approval within ten (10) business days of such request, the City's approval shall be deemed to have been obtained. The Director of Real Estate and Asset Management for the City will serve as the City's contact person, and the City Manager, subject to compliance with authorizations, procedures and requirements prescribed by the City Charter, City Code, and the directives of the City Commission, shall act for the City as to all approvals from the City referenced herein. Depreciation Payments under the Lease Documents. The Parties hereby agree to waive the obligations under Section 7.4 of the Lease Documents of Hyatt to pay towards a reserve to make depreciation payments in connection with capital costs associated with the Physical Plant and the City to furnish an analysis of such capital and depreciation costs on an annual basis. 4, Breach of Agreement. In the event that either of the Parties fails to fulfill its obligations (and such failure is not due to force majeure, the action or inaction of the other Party, and other events outside of such Party's reasonable control), and after the expiration of all notice and cure periods as set forth herein, the violating Party shall be deemed to be in default of this Agreement. As a result of a default, the non -violating Party shall be entitled to pursue any and all remedies permitted under law and in equity upon the expiration of a ten (10) business day grace period following written notice to the other Party as set forth below in Section 9; provided, however, with respect to the Projects, so long as Hyatt has commenced to cure any default related thereto following notice from the City and is diligently pursuing to cure such default, Hyatt shall have such additional period of time as reasonably necessary to cure such default. 5. Mutual Releases. Upon execution of this Agreement by the Parties and approval of this Agreement by the Miami City Commission, the following shall be effective: A. City's Release to Hyatt: Except for the rights, duties and obligations of Hyatt created under this Agreement, the City, for itself and its predecessors, agents, directors, officers, members, employees, affiliates, successors, assigns, trustees, bankruptcy trustees, personal representatives, beneficiaries, devisees, and legatees (hereinafter collectively referred to as the "City Releasors"), hereby releases and forever discharges Hyatt and each of its respective subsidiaries, predecessors, agents, managers, attorneys, directors, officers, employees, affiliates, successors, assigns, trustees, bankruptcy trustees, personal representatives, beneficiaries, devisees, and legatees (hereinafter referred to as the "Hyatt Releasees"), whether past, present or future, jointly and severally, of and from any and all debts, claims, demands, actions, causes of action, rights, obligations, damages, and liabilities of any and every kind or nature whatsoever, in law or in equity, past, present, or future, known or unknown, direct or indirect, asserted or unasserted, fixed or contingent, whether contemplated or not, whether based in tort, contract, contribution, or any other type of recovery, and whether for compensatory, consequential, incidental, statutory, punitive, or other damages, which the City Releasors have, may have or had arising out of the following claiins: (1) the Fire Alarm Project, (2) Tile Project, (3) Concession Fees, (4) Maintenance Costs, (5) Other Fees, (6) cooling tower and chiller replacement project including, without limitation, the Chiller Overpayment and the Phase I Design Fees, and (7) depreciation payments including without limitation the Depreciation Credit (collectively, the "Released Claims"); provided, however, that this Release by the City Releasors does not release any Claims other than the Released Claims. B. Hyatt's Release to the City: Except for the rights, duties and obligations of City created under this Agreement, the Hyatt, for itself and its predecessors, agents, directors, officers, members, employees, affiliates, successors, assigns, trustees, bankruptcy trustees, personal representatives, beneficiaries, devisees, and legatees (hereinafter collectively referred to as the "Hyatt Releasors"), hereby releases and forever discharges City and each of its respective subsidiaries, predecessors, agents, managers, attorneys, directors, officers, employees, affiliates, successors, assigns, trustees, bankruptcy trustees, personal representatives, beneficiaries, devisees, and legatees (hereinafter referred to as the "City Releasees"), whether past, present or future, jointly and severally, of and from any and all debts, claims, demands, actions, causes of action, rights, obligations, damages, and liabilities of any and every kind or nature whatsoever, in law or in equity, past, present, or future, known or unknown, direct or indirect, asserted or unasserted, fixed or contingent, whether contemplated or not, whether based in tort, contract, contribution, or any other type of recovery, and whether for compensatory, consequential, incidental, statutory, punitive, or other damages, which the Hyatt Releasors have, may have or had arising out of the Released Claims; provided, however, that this Release by the Hyatt Releasors does not release any Claims other than the Released Claims. 6, No Admission of Liability. Each Party expressly recognizes that this Agreement shall not in any way be construed as an admission by any Party hereto of any unlawful or wrongful acts or omissions whatsoever with respect to the Released Claims stated herein. This Agreement shall not be admissible in any proceeding as evidence of any admission by any Party hereto of any violation of any law or regulation or wrongful act or omission, This Agreement may, however, be introduced as evidence in any enforcement proceeding to this Agreement. 7. Non -Assignability of Transferability of Claim. Each Party hereby warrants, declares, and represents that no part of any asserted and/or assertable claims has been assigned or transferred, and that each Party has full, exclusive, and unencumbered right, title, and interest in and to such asserted and/or assertable claims. 8. Governing Law and Venue. This Agreement shall be governed by the laws of the State of Florida, The Parties acknowledge that this Agreement is being entered into in Miami -Dade County, Florida and that the jurisdiction to enforce the terms of this Agreement shall exist in the Eleventh Judicial Circuit, Miami -Dade County. The Parties expressly select, as their venue, any and all action/litigation in Eleventh Judicial Circuit, Miami -Dade County of the State of Florida. It is further acknowledged and agreed that any claim, dispute, action (administrative or otherwise), and/or litigation relating to this Agreement, that the Parties shall bear, at their sole respective expense, their own attorneys' fees and costs. 9. Notices. Except where this Agreement expressly provides otherwise, all notices and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given (a) on the earlier of the date received or three business days after delivery, if sent by registered or certified mail (return receipt requested); (b) when delivered, if delivered personally; (c) on the next business day, if sent by overnight mail or overnight courier. If any Party is represented by counsel (whether or not named in this Agreement), any notice given by such counsel for such Party shall be fully effective as if given by such Party. Any notice shall be given to the recipient at these addresses (or at such other addresses as shall be specified by written notice given in accordance with this provision): CITY OF MIAMI City of Miami Office of the City Manager 444 SW 2 Avenue, 10t4i Floor Miami, FL 33130 With a copy to: City of Miami Dept. of Real Estate & Asset Management 444 SW 2nd Avenue, Suite 325 Miami, FL 33130 City of Miami Office of the City Attorney 444 SW 2 Avenue, Suite 945 Miami, FL 33130 10. Miscellaneous, The Parties further agree as follows: HYATT Hyatt Equities, L.L.C. Hyatt Center 71 South Wacker Drive 12°h Floor Chicago, IL 60606 Attention: Megan Schmollinger With a copy to: Hyatt Corporation 71 South Wacker Drive le Floor Chicago, IL 60606 Attention: General Counsel A. No waiver of any breach or default hereunder shall be considered valid unless in writing and signed by the Party giving such waiver, and no such waiver shall be deemed a waiver of any subsequent breach or default of the same or similar nature. B. Each Party hereto shall cooperate, shall take such further action and shall execute and deliver such further documents as may be reasonably requested by any other Party in order to carry out the provisions and purposes this Agreement. C. This Agreement may be executed in one or more counterparts, all of which taken together shall be deemed one original. D. In the event any terms or provision of this Agreement be determined by appropriate judicial authority to be illegal or otherwise invalid, such provision shall be given its legal meaning or be construed as deleted as such authority determines, and the remainder of this Agreement shall be construed to be in full force and effect. E. Any approvals required by the Parties under this Agreement shall not be unreasonably withheld, conditioned or delayed. 1 I . Knowing and Voluntary, The Parties acknowledge and represent that they have carefully read and fully understand of the provisions, terms and conditions of this Agreement and have reviewed this Agreement with their respective counsel. The Parties further acknowledge and represent that they have entered into this Agreement freely, knowingly and without coercion or duress and based on their own judgment. 12. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties, their personal representatives, successors, and assigns. 13. Interpretation. The Parties hereby acknowledge and agree that; (a) in the negotiation and drafting of this Agreement, they have each had the opportunity to consult with counsel of their choice; (b) each of their counsels has had an opportunity to contribute to the negotiation and drafting of this Agreement; and (c) the principle of construing a document most strictly against its drafter shall not apply with respect to the interpretation of this Agreement. 14. Entire Agreement. This Agreement constitutes the complete understanding between the Parties with respect to the subject hatter hereof and supersedes all prior agreements, understanding and arrangements, both oral and written, between the Parties with respect to such subject matter, This Agreement may not be modified in any way unless by written instrument signed by each of the Parties. 15. Authority to Execute. The Parties represent and warrant that the individuals executing this Agreement on each Party's behalf have the full authority to do so. 16. City Commission Approval. This Agreement is subject to the review and approval of the Miami City Commission and therefore this Agreement shall be effective as of the date of execution by the City after obtaining such approval. [Signatures on following page] CITY OF MIAMI, a municipal corporation Attest: Daniel J. Alfonso, City Manager Todd B. Hannon, City Clerk APPROVED AS TO LEGAL FORM AND APPROVED AS TO INSURANCE CORRECTNESS: REQUIREMENTS: Victoria Mendez City Attorney HYATT EQUITIES, L.L.G. By: Its: Ann -Marie Sharpe Risk Management Director Attest: Printed Name Printed Name Exhibit A Flooring Repair Arca [Attached] TERRACE REGENCY WATERPROOFING HYATT REGENCY 400 SOUTH EAST SECOND MtAMI, FLORIDA 33131 MIAMI AVENUE REPAIRS NOTES ° KEY PLAN 4..E gMt-*rmez C. 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T!TeE siiE'r.T, KEY PLAN ,1,.t,.Mm.;A DRAWING INDEX AND kQT 1.5 0...., wsmausrPotPawx-wtw c,wen.A Im, M w5.lewm,,,NP. ,'ac...K.mak-Psrciami wo TITLE 24-EET1KEY PLAN N OYES 947 d5 Rtmlemem..¢ ma ma P.M.m.m.,M1. w-t D=vA4G5 PVW A-2 +tnPswc.B >s 11tiE 2696 _ A3 PHOT- S A-0 • trE • C•` 4�EFL4A,�CE.pL4N TUSSICE wA{CAPFaDmic RE?A•F5 TE RRAG% FLAN w delve zc;s A=i S • ,-0 r:$1 TYr jCAIti TERRACE SECT EONwill NEIN TILE Mar, D&tJ AT?LANTERWALL 1..Z.FircrrEckt - -e� t � s�y1-yricAL.EXpArstSoN JOEN7LETAIL y �4-11:1) tra -- . r 4 IFa } Z DETAIL dL Q�HG'XALL CAJ • Puorkt pRAIN DETAL ,Oa 'ri'PICAL PRR iC '�. r_ Aar TaarKG r^� bETfIL AT CURS 3 x wce TY. ICAL TEE.ZRAI E SRA N'ETAT- xc+sa arAc TERRACE SECTION WITI CONCRETE WEARING SLAB W.T.4a.7E '1 b bflRh i RGrAo4.. +:FT PtiyN^ WA% 94105 20, a—z WAREA r; EN 37ALFLS ANC CURTAINWAl, n"riPICAL ZOLATECe PLANTER QF C RTAINWN-L TTp3 LUGN7PC5% CITY aluec E STAI (S 'TyPIrwl pLANTRS AT WEST 810E ED4A,r WA`[F; ROQKIFG KLPAR5 4YAIT RE4YlI T A0444l M. �'ptrpa 4UN[ 201a 2 3 Exhibit Fi Novernbcr 12, 2012 Letter [Attached] Kerrie L. Dowd Senior Counsel 71 South Wacker Drive Chicago, IL 60606 USA T: +1 312.780.5467 November 12, 2012 Via 4 -mil (htorre@rniamigov.com) Mr. Henry Torre Director City of Miami Public Facilities Division /Asset Management Division 444 SW 2nd Avenue, 3rd Floor Miami, Fl. 33130 Re. Hyatt Regency Miami (the "Hotel"); Lease and Agreement for Development dated September 13, 1979 (the "Lease") between the City of Miami (the "City") and Hyatt Equities, L.L.C. ("Myatt"), as amended; Operations and Maintenance Agreement between the City and Hyatt ("O&M Agreement") Dear Henry;; I am writing to follow-up on the outstanding matters following our conference call on August 29, 2012 (the "August 29 Call") and to respond to your offer of a one-time waiver of overtime charges of $28,O00 in exchange, 1 believe, for Hyatt's payment of $302,000 in concession fees billed by the City to Hyatt, which fees have been disputed by Hyatt. We assume this offer by the City also includes Hyatt agreeing to pay concession fees in the future. Assuming these me the terms of the offer, Hyatt does not accept the City's offer. First, it is Hyatt's position that the concession fees are not properly due and payable and have been wrongfully charged to Hyatt by the City. Second, the City has not responded to Hyatt's .request made during the August 29 Call fora legal analysis as to why the City believes the concession fees are due and payable by Hyatt. Third, the City's offer does not address the other fees which are disputed by Hyatt, and for which the City, during the August 29 Call, agreed to provide a response, and has failed to do so. All capitalized terms used herein, and not otherwise defined, shall have the meanings ascribed to them in the Lease or O&M Agreement. The following items are in dispute by Hyatt and were discussed during the August 29 Call. Many items, as noted below, require a response from the City. Henry Torre November I2, 2012 Page 2 of 5 Concession Fees The City has wrongfully charged, and continues to wrongfully charge, Hyatt a concession fee for events (ticketed and non -ticketed events) at the James L. Knight Center when Hyatt is the exclusive concessionaire (per the Lease) and not the user of the space and when there is a third party user renting the space. The concession fees charged to Hyatt are not supported by City ordinance, the Lease, the O&M Agreement or custom and practice in the industry. City Code Sec. 53-181(1)(a) created a new category of charges for food/beverage concession with respect to meetings or general sessions in the Theater/Auditorium. The ordinance shows the concession fees as a charge for ge of the Theater/auditorium space and diargg p e egg slogs u. Moreover, per the Ordinance, this charge does not apply to exhibits or ticketed events in the Theater/auditorium. Yet, the City has charged Hyatt as the concessionaire for what is clearly a use fee under the Code and has charged for all events (ticketed and non -tickets), in violation of the Code. Section 8.3(a) of the Lease establishes Hyatt as the sole provider of food and beverage services for the Convention Center, without charge or fee for this privilege, Hyatt bargained for the right to be the sole concessionaire and the sole consideration for that right is the Lease itself. The City's charge of fioncession fees to Hyatt for its concessionaire services is also in violation of this provision of the Lease. Correspondence from two Assistant City Attorneys states that these concession charges were established to defray, at least in part, the City's clean-up costs incurred as a result of patrons bringing food and beverages (supplied by Hyatt or its predecessor as concessionaire) into the Auditorium. However, per the O&M Agreement, both the Auditorium and the Exhibit Hall are in the City's areas of responsibility. Accordingly, pursuant to Sec. 1.5 and 4.1 of the O&M Agreement, the City, not Hyatt, is to keep these facilities in "good and clean order and condition." The Lease and the O&M Agreement do not support a clean-up fee to Hyatt in connection with its concession services. If the concession charges in Sec. 53-181(1)(a) of the Code (concession chtuges for meetings or general sessions in Auditorium) apply to Hyatt at all, they should only apply if Hyatt is the lessee of the Auditorium for a non -ticketed meeting or general session. They should not apply to Hyatt when a third party leases the Auditorium and Hyatt acts as caterer. Custom and practice in the industry do not support the charge of the concession fees to Hyatt, as the concessionaire, Auditoriums similar to the James L. Knight Center (Bank United Center, Jackie Gleason Theater on Miami leach and the Adrienne Arsht Center) do not charge any concession fees or clean-up fees to their concessionaires. Rather, any concession fee or clean-up fee is charged to the third patty userhenter of the space and/or included in the rental fee. Please advise as to the City's basis for charging Hyatt the concession fees pursuant to the Code. Henry Torre November 12, 2012 Page 3 of 5 Mgetine Jtoga!i Jtate The City increased the rates being chnrgcd Hyatt for use of meeting space at the Convention Center; however, such increase was not supported by City Code. Contrary to the City's assertion that increases to meeting room rates at the Convention Center are not subject to City Commission approval and do not require an amendment to the City Code, the rents, rates, fees and charges for the use or occupancy of and for the services furnished in connection with the Convention Center are clearly established by City ordinance and presently codified in Section 53.181 of the City Code. The establishment of such rents, rates, fees and charges for the Convention Center is the province of the City Commission and them is no delegation of that authority to the director of the Convention Center, In fact, Veronica Xiques, Assistant City Attorney, in her letter to me dated May 10, 2011, clearly advised that "['The City Commission establishes rental fees for the .Knight Center and all entities using the facilities must comply." Moreover, the City's own website for the Convention Center lists a fee schedule for meeting space rentals less than the amounts charged Hyatt for the same space, in violation of the Lease. Section 8.3(b) of the Lease provides that the rates and charges for use of Convention Center by lessee must be the saute as those charged to third parties. Yet, Hyatt is being charged more than the rates advertised to third parties. At one time, the City asserted that the increased rates were for equipment charges, and cited City Code Section 53.181(1)(d). Section 1(d) of City Code Section 53-181 provides for charges for certain "ancillary services" with respect to the Theatre/Auditorium. Among the items identified in paragraph 1(d) are "Event personnel," "Equipment rentals," and certain "other services-- Police and Stagehand." The increased charges by the City are clearly for meeting space, not equipment or ancillary services. Moreover, Section 1(d) oniy applies to the "Theater/Auditorium rates." Section 1(d) does not apply to "Meeting and seminar space" (Section 2) or "Exhibit Hall" (Section 3). Please advise as to the City's basis for increasing fear for the meeting space without first seeking City Commission approval and an amendment to Section 53,181 for theater and auditorium rates, and for charging rates for the meeting space to Hyatt in excess of those being charged to third parties. Clearnink Fees. The City charges Myatt a $500 cleaning fee for any concession event held in the Convention Center. Hyatt is the sole concessionaire under the Lease, and there is no charge for this right. Any charges the City wishes to recoup should be charged to the third party user. Moreover, there is no support for this charge in Sec, 53-181 of the Code. The City also charges a clean-up fee for damage such as carpet and wall stains. This fee should be governed by the use agreement between the City and the user. Hyatt, in its capacity as concessionaire, should not be charged this fee by the City if it isn't the user. Henry Torre November 12, 2012 Page 4 of 5 During the August 29 Call, the City conceded that these fees should not be charged to Hyatt, Please discontinue the City's charging of these fees to Hyatt immediately, Hyatt reserves all rights and remedies with respect to these charges under the Lease, at law and in. equity. Restroom Attendant. The City charges a restroom attendant fee when Hyatt rents certain facilities. There is no support for this fee in Sec, 53-181 of the Code. This service is included in the rent for the facility and should not be additionally charged. During the August 29 Call, the City conceded that these fees should not be charged to Hyatt, Please discontinue the City's charging of these fees to Hyatt immediately. Hyatt reserves ail rights and remedies with respect to these charges under the Lease, at law and in equity. illioxa beer The City recently advised Hyatt that it would increase the charge from $50 per day to $100 per day for tiny Hyatt function that uses a registration table that is outside of the leased room .and on City space. Sec. 53-181(2) of the Code permits a $50 per day charge. We are not aware of any ordinance increasing the amount of the charge, Durivag our August 29 Call, the City agreed to review and respond to Hyatt. Hyatt has not received a response. Overtime Rates. The City advised that It will charge overtime rates for events that exceed eight hours, occur on weekends, or require; special needs. There is no support for this charge in the Code, except to the extent these charges fall within the ancillary services to the Theater/Auditorium that are permitted by Sec, 53-181(1)d), During our August 29 Call, the City agreed to review and respond to Hyatt. Hyatt has not received a response, other than the offer of a one-time waiver. However, no basis for why these charges are proper has been provided. Set-up: and Break -down —R verfront Ha11. Section 8.4 of the Lease requires the City to maintain and operate the Convention Center in good clean order and condition as a fast-elass facility. The City is required to maintain and adequate staff to do so, if the City does not so operate and maintain, the lessee may do so and charge back the City. During our August 29 Call, the City agreed to review and respond to Hyatt, Hyatt has not received a response. Henry Torre November 12, 2012 Page 5 of 5 Maintenance ,' es due "knit The City currently owes Hyatt approximately $43,318.00 for its share of maintenance costs for the Central Plant, The City originally advised Hyatt that it ceased reimbursing Hyatt for the maintenance costs in an effort to offset these amounts against the amounts the City claims that. Hyatt owes for concession fees. However, as noted above, Hyatt does not believe the concession fees axe owed and has been disputing these fees. Moreover, the Lease does not provide for a right of offset. Then, during our August 29 Call, it was made clear by the City, that the failure to pay these charges was strictly a matter of budget shortfalls. Yet, the services are still being provided to the City, and Hyatt continues to pay for the City's portion of these fees. Please arrange for the immediate payment of the City's portion of the maintenance costs that are overdue. Nothing contained herein shall be deemed a waiver of any of Hyatt's rights and remedies under the Lease or O&M Agreement. Hyatt would appreciate your response to the Items listed above. Please let me know if you have any questions. Sincerely, Kerrie Dowd co (via e-mail): Dave Phillips Luis Alorna Veronica Xiques Daniel Newhoff Exhibit C Memorandum o£-Lind arstanding [Attached] [Enid ofDocurnent/ i March 21, 2017 Tiffany Leadhettcr Donato Senior Vice President Capital Strategy, Real Estate Transactions - Hyatt Hotels Corporation 7 South Wacker Drive Chicago, IL 60606 Re: Memorandum of Understanding: (1) Amended and Restated Land Lease • Dear Mrs. Donato: Hyatt Equities, L.L.C. ("}-watt") and the City of Miami ("City,") (collectively, the "Parties") desire to amend and restate their existing land lease relationship, and have Hyatt redevelop the Property (as anticipated and defined in the Terra Sheet attached hereto), ktpon which the existing Iiyatt Regency Hotel and lames L Knight convention center occupy. The following paragraphs set north the basic terms and conditions upon which said relationship shall be structured subject to the negotiation andexecution of an amended and restated land lease (the "New. Legg"), and the other terms and conditions contained in the Term Sheet, At the minimum, said agreement is anticipated to incorporate the following: 1.) The Parties will enter Into an interim agreement with respect to the 'Existing Cirnnnd Lease (as defined in the Terms Sheet) to address certain immediate needs of the Hotel between the date of such agreement until the New Lease is entered into and the redevelopment process eminences, including, without limitation, an agreement on the payment of certain shared expenses on a going - forward basis and an agreement of the Parties to stay current on such obligations during the interim per kid. 7) The Parties shall intend to modify the Existing Ground Lease, including, without limitation, to:: a. Extend the land lease term plus extensions to a total of 99 years; h. Expand the lensed premises to Include the lames L Knight convention center/meeting space; c. Amend and restate the parking agoenlent to accommodate a. and b. above; d, In conjunction with the New Lease and upon termination of the Existing Ground Lease, as agreed by .both .Parties, resolve and absolve (except to the extent the Parties resolve to have continuing obligations Thereafter, such as a payment plan) the Parties from, current disputed financial obligations for capital improvement projects undertaken, revenue and expense sharing agreements and other runners. Any agreed upon payment plan for such outstanding amounts shall be attached to the New Lease and each Party shall comply with such payment plan and other agreements made between the Parties in resolution of such outstanding amounts owed between the Parties.( e. Hyatt shall redevelop the Property subject to the following: i. Hyatt shall explore the use of the additional development rights can the Property; ii. Hyatt shall engage directly CI RE, Inc. to seek qualified development partners to maximize: the Property's development potential and density; additional development could include: but not be limited to residential, office, retail, and/or parking; iii. Seek possible development partners, taking into consideration the qualifications and financial capacity of said partners, programmatic and aesthetic design, .and financial benefit anticipated to inure to the benefit of Hyatt £i.nd the City. iv. The. Parties will mutually agree upon a Master Plan (as defined in the Term Sheet) for the redevelopment of the Properly. When fully executed, this Memorandum of Understanding (together with the term sheet attached hereto as "Attachment A' and incorporated herein (tire "Tern Sheet"), the "MO)U") shrill reflect the expression of Hyatt's and the City's desire to proceed with the negotiation and possible: execution of a New Lease to include the redevelopment of the Property. New Lease. Subject to certain conditions as ,et forth in the MOU being satisfied, the New lease will he ne.gotiated to reelect the intended deal terms set forth in the MOU, fir. iclur'ivit From the date hereof through March 31, 2017 (the "Diclusivi,ty_P„aiort"), City shall negotiate exclusively with Hyatt for the redevelopment of these pnrcels; provided, however, that in the event the Parties mutually agree ill writing, or. Hyatt notifies City in writing or its intention to cease the negotiations prior to such date, then the Exclusivity Period shall expire on the date of cessation of negotiations. Con fldeutiolity. The terms of th is MOU and the New Lease, as well as any non-public information re{aLed to the transactions shall be maintained as confidential by the Parties, except for (i) disclosures required by. Icrw (specifically 'including Florida Statute Chapter 1 19) or rules of applicable securities exchanges, (ii) disclosures to the Parties' respective hoard members, agents, employetks, attorneys, accountants, brokers, contractors, lenders, prospective lenders, .investors, prospective investors, consultants, advisors or other representatives, and (iiii) disclosures that the Parties mutually agree in advance are required or desirable to advance Zoning Entitlements (as defined in the Terra Sheet) or other public approvals or concessions or information that otherwise advances the planned development. The foregoing notwithstanding, the Parties agree that any pub[k announcement elan executed transaction (Le., executed New Lease) shalt be mutually agreed upon by the Parties prior to any public announcement. Note-I3tni1hi . This tvlOU shalt net create any legally binding obligations on the Parties, other Haan with regard to the Exclusivity and Confidentiality provisions set forth above. Except for such provisions, City and Fiyatt shall not have any obligations to each other unless and until full execution of the New Lease, If a New Lease is not executed by expiration of the Exclusivity Period, unless otherwise agreed to by the Parties in writing, this MOU shall automatically terminate, other than the above Cor ffdentdality provision, which shall survive termination fur one (1) year, hi addition,. this MOU shall terminate in its entirety upon the full execution of the New Lease. For the purposes of this discussion, this MOU andsubsequent contract documents will require a.pproval of the City Commission. That process may include the item boing place on the Commission Agenda, 1`` and 2"u readings and then final approval. The final New Lease shall also require approval by the voters at Referendum. Each of the City and Hyatt,. and their respective affiliates. representatives, and associated entities shall use corruucrcially reasonable efforts to. comply, in all material rrpec.ts, with all applicable laws, rules, regulation, disclosures, and statutes (whether Local, state, or federal), to include the Miami 21 con lug ordine nee, in the perfornin nee of this or any agreement, instrument, or actions) relative to the MOU or New Lease_ The City she 11 cooperate. with Hyatt, its affiliates, representatives and associated entities to facilitate and expedite approvals and conformance with local, state, or federal .ordinances as may be reasonably required. 2 The Parties understand that this MOU and any subsequent contract documents will require the applicable internal approvals of Hyatt, including; the approval of Hyatt's Development Committee, the Finance Committee of I•Iytstt`s Board of Directors, and Hyatt's Board of Directors. If you are in. agreement with the terms of this MOD, please indicate same by counter -signing where indicated below, We look forward to moving forward with you on this important project. S iixcerely, CITY OF MIAM L a municipal corporation of the State of Florida By: Daniel J. Alfonso City Manager Accepted and Agreed to: HYATT EQUITIES, L L,C. I3v: Title: 3 ATTACHMENT A TERM SHEET This terra sheet (-Term Sheer.). ). dated this day of , 2016, in a proposal only. and is not contractually or legally binding. It,represents only an expression of the parties' present desire and intention to enter into negotiations of it possible agreement to lease the Property (as defined below) by Hyatt (defined below) from City (defined below). City and Hyatt are sometimes collectively referred to herein as the "Parties" or individually as ft "Party". The outline of the general terms and conditions arre as follows. 1. GENERAL.: 1, t, PARTIES TO NEW W LEASE: Hyatt Equities, L.L.C., or an affiliate thereof, as ground lessee and developer, if applicable ("Myatt"), Hyatt inlay enter into subsequent agreements, with City of Miami ("City") a.pprova I as may be required under the New Lease or by applicable lativ, including, without limitation, joint venture agreements, development agreements or sublea,ses with prospect nve partners, developers or other third parties in conncctinn with the performance of its duties under the New tease; and 1.1.2. City of Miami, as ground lessor ("city"). .1. THE PRt]I'.1:1 TV: City and Hyatt Will enter into an amended and restated lease (the "Ne;w Lea.,e") of the existing, Ground Lease pursuant to which Lessee currently lases from Lessor the real property. (the "Hotel Land") upon which the Hyatt Regency Miami (the "Hotel") is localtnJ (tire 'Existing Ground Lease"). Pursuant to the New Lease, (i) the City will contiiuj to lease to Hyatt, and Hyatt will continue to lease from 'the City, all of the City's right, tide and interest in the Hotel Land,. including any City interest in the Hotel and any other iinprovements, furniture, fixtures, and personal property located on the Hotel Land and any additional develops eitt, air or other rights appurtenant to the Hotel Land not currently provided in the existing land lease, as a ,rreed by the City pursuant to the approved Master Pbtit, and (ii) the City will agree to lease to Hyatt, and Hyatt will agree to lease from the City, the real property, upon which The James L. Knight Miami Convention -Center (the "Convention Center") is located (the. `* _rity_entiQr}_C;er egg Land"), includ'sng, without limitation, the Convention Canter and all other improvements located on the Convention Center Land, any City interest in the furniture, fixtures, improvements and personal property located on the Convention Center Land and any additional development, air or other rights.appurtenulnt to the Convention Center Lancl as meed by the City pursuant to the approved Master Plan (() and (ii) are collectively referred to herein as the "Property").. 1,3. DUE t tL1GCNCE: Hyatt shall complete all due diligence work it deems necessary or advisable on the Property prior to its execution of the New Lease, at its sole cost and expense, including without limitation, title, survey, soils, entvironmentai aid all feasibility studies and tests. City and Hyatt shall execute a separate cunt€nercially reasonable access agreement granting Hyatt and its agents and consultants access to the Property in order to conduct the requisite tests and studies, subject to -customary release, indemnification, insurance. notice and repair requirements. Upon its completion and receipt thereof, and upon request from the City, Hyatt shall deliver to City copies of all third -party environmental, property condition and soil reports, surveys and title .reports resulting from its due diligence activities related to the Property. Subject to such access agreement, City will grant Hyatt immediate and reasonable access to the Property, the Parking Garage. the Property records, and the Convention Center management team and other employees for thc purpose of inspecting the physical condition of the Property (including for the purpose of soil and other environmental tests and mechanical and other inspections) and evaluating the Convention Center business, in I-lyatt's sole discretion. The City shalt deliver copies to or provide access to Hyatt of all Properly records within City'a possession, or the possession of its Convention Center manager, affiliates, consultants, agents, representatives or employees, including,, without limitation, environmental reports, property reports, title commitments and policres,surveys, building plans, correspondence with or notices front any governmental agencies, intbrmation pertaining to any lawsuit(s) pending against the Convention Center, the Hotel or the Property, and any other information reasonably requested by Hyatt. 2. REDEVELOPMENT: 2.1, Within {twelve (12)1 months of execution of this Terri Sheet, Hyatt shall preparc, and deliver to the City for its review, a master plan: (the "Master Plan") for the redevelopment of the Property (the "Project"). The Master Pktn shall include, among other cast€tiponents: parcel development play.; (for a.Myatt hotel, meeting space and other typica. hotel amenities, and. expanded mixed use development that may occur on the site), financing' equity plans for the Project; strategy for the use of public funds public: funding nieohanisins or public assets including use plains, desired densities, design criteria for base buildings and public .spaces, a proposed. streetscape, a retail merchandising plan to the extent retail is an element of the development, an infrastructure plan and a parking plan. The blaster Plan should. include proposed development that maximizes the site's density and proposed Project phasing. If agreed upon, the Master Plan approved by the City and Myatt shall he attached to the 'New Lease and EIdatt shall deveiop the Property in accordance with the tvlaster Plan agreed to and approved by the City. 2.2. if' Hyatt and the City, in their discretion, determine to .proceed with the Project based upon an agreed upon Master Plan and terms to the New Lease, Hyatt's obligations under the New Lease shall include, among other requirements: (i) to redevelop the Property as contemplated by the Master Plan; (ii) to obtain Zoning Entitlements (defined below) as necessary, for the Property to permit development of same: (nil) to secure the requisite egti ity investment and financing necessary for the Project within the parameters set forth in the New Lease (iv) to adequately address all infrastructure requirements necessary for the timely development. of the Property, (v) to develop a plan to adequately address parking requirements for the Project (et) to construct the improvements in accordance with the ivla ter Plan and plans otherwise approved by the City pursuant to the normal planning and permitting process; and (vi`i) to operate and maintain the buildings, grounds, and infrastructure in the manner prescribed by the New Lease throughout the term of the N.ew Lease. 2.3, IF the Parties electto proceed with the Project, Hyatt shall take the lead, al its expense, in obtaining all entitietne€its for the Property to accommodate the approved Master Plan ("Zoning Entitlements" ). The City shall use its best efforts to as.sist and reasonably cooperate with Hyatt throughout the Zoning and Entitlement process. 2A. In the event that thc Parties eleet, or either Party elects, to not proceed with the Project, the Parties shall have nc- obligations hereunder other than the confidentiality provisions. 3. NEW LEASE: 3.1. EFFECTIVE DATE OF LEASE; TERM: The New Lease shall be effective (the "Effective Date") upon execution by the Parties, and each Party having obtained all necessary approvals as set forth in tl.ie NADU and this Term Sheet and the Parties having agreed upon the blaster Plan, which will be attached to the New Lease. The initial terra for the New Lease shall be from the date of ground lease execution (''Commencement Tate") through December 31 of the year that contains the 99r" anniversary attic Commencement Date. 3.2. GROUND RENT: l'ly_att Hotel and Adjoining James' T-, Knight Convention Center On or before January 1" of each lease year, Hyatt shall pay to the City base rent (`'B.se React") for the Property as follows: Paring the cpristruction period: Base Rent (to he paid by Hyatt, or the developer of the Project, during the eonstrtn tian period) for the Property shall be the following-: Year one (1) during the construction period ,St) Year two(2) during the construction period $500,000 Year three (3) during the construction period $500,O00 Thereafter and ttngoinst..Hyatt shrill pav to the City not less than: Two million dollars ($2,O00,000) per year (as may be escalated from year to year) or, ii, The mathematical average of two appraisals commissioned by the City fOr the land under which the hotel Is constructed plus space occupied by the lames - Knight convention center. The formula for the establishment of base rent For the hotel property and James L. Knight center shall be five percent (5%) multiplied by the mathematical average of appraised value, Should 5% of the mathernatleea1 average of two appraisal exceed two million S(2,O00,000) per year (as may be escalated .from year to year), Hyatt shall be required to pay up to, but not more than Seven percent (7%) of gross room and meeting receipts of the Property phis 5% of gt'oss beverage receipts, plus 3% of food receipts, plus a to be determined -percentage of Act gross inccxne reeeipts,•as agreed upon the parties once such other income sources at the Property are determined.. For the avoidance or doubt, Hyatt shall not pay any other rent or fees to the City for space utilized iri the operation od'the Hotel and meeting space on the Property. 3 b. Profits Partieip Lion for Expanded Development on the Property_ in addition to Base .Rent for the Hotel and meeting space, after the construction period, the owner of the non -Hotel components of the Project shall pay to the City a profit participation rent (``Participation Rent") with respect to the other income producing areas of the Property, other than the Hotel and Hotel land and tweeting space, determined as the greater 4 f: 1) Are be determined percentage of gross profit associated with expanded development on the Property as defined in the agroemcnt for the redevelopment of the Properly; mid 2) Rent formulaically determined by: i, A current appraisal of the property occupied by the €Totel and James L.1<tiipltt Convention ion Center as a "going concern" sha I l be performed. ii. An appraisal of the land area of the Hotel :and James L. ltrtight Convention Center land arid all appurtenant air rights shall be performed amtd determined for "highest and hest use" iii. The difference between highest and best use value of the Hotel and James L. Knight Conventioi Center land and value of going concert or the Hotel and Convention Center shall be the City's financial contribution to the expanded development. See Below E.xa.nrikle for Demonstration Purposes Only: Highest & Best Use Value of Hotel and Convention - X $100.000,000 Center Land Less: • Value of Hotel and Y $60..000,000 Convention Center as Go{rig Concern lsrun[s: Cit • Contributions Z $40,000,000 City's Contribution shall be treated as a limited partner- equity investment. Notwitirstand.ing the foregoing, the City shall not be a joint venture or partner with Hyatt; any references to partner equity investment and similar terms s are solely .for purposes of eaten lating Participation Rent. Therefore, if the total investment for the expanded development is A $200,000,000 then. City`s profit participation using the example above shall be 20% of Z ($40,000,000) divided by A ($200,000,000) . The numerator is equal to Z ($40,000,000) and the clenomintitor is A ($200,000,000) which produces the City's equity contribution of 20%. 1.3. ANNUAL ESCALATOR: On the 5th anniversary of the commencement of the New t..ease, and on each Sit' anniversary thereafter during the remaining Term or extensions thereof, the minimum Base Rent shall be the cumulative compounded increase in the Consntucr Price Index for All Urban Consumers (CPI-U) 'Miami; provided, however, that the increase in Base Rent shall in no event he less than two percent (2.0%) per year. 4 3.4, NET LEASE: The New :Lase shall -be absolutely net to City, and Hyatt shall pay all real estate taxes, operating and other related expenses during the term thereof. 3.5 SUBORDINATION: The New Lease, any leasehold interest:; created thereby and any security interests granted therein (to lenders, equity providers and the like) shall be subordinate to City's fee interest in the subject. Property nt all times throughout the New .Lease terra or extensions thereof; provided, however, that the Parties shall record a memorandum of lease against the Property, which shall be senior in priority to any encumbrance on City's feu s imply; interest in the Hotel Land and Conve,ntian Center Land and reversionary interest in the improvements on such lands. 3,6 PARKING: The New Lease will provide Hyatt with all the sable larking right% currently held by Hyatt with respect to the Hotel trader the existing Ground Lease. The Parties will cooperate with each other to reasonably apportion parking in the al Garage to provkle necessary additional parkins; For the Project. Notwithstandin-g the foregoing. as Dart of the .Project, Hyatt- may propose that all or some portion of tile parking requirements for the Project be met .by proposed parking within the h.:Easter Plan for the Property (separate and apart from parking within the Parking Ciarage). 3.7 ASSIGNMENT AND DlSPQSMON RIGHTS: With City-'s pricer written approval. Myatt tn,3y assign the New Lease to an assignee that has a net worth or[s __ and either holds a franchise with a First Class Hotel Company or errtgttges a manager who is a Y. ir±t Class Hotel Company. A "First Class Hotel Company" is tt company or product type that enjoys a reputation in the hotel industry similar to that of Hyatt Corporation and the Hyatt .Regency product. I (yatt's ability to rnortgage,.pledge -or conditionally assign the Now Lease to leasehold mortgages shall be as provided in the New Lease. 3.8 MORTGAGEE PROTECTIONS: The New Lease shall include customary and commercially rensona.ble provisions fbr the benefit of Hyatt.'s lender, including, without limitation, the right of lender (1) to receive notices of any Hyatt de faults or termination by City, (ii) to cure any Hyatt defaults within a reasonable grace period, mid (iii) upon termination of the New Lease, to .enter .into a new lease directly with City on the same terns and conditions as the 14ew Lease upon lender's cure of all of H•lyatt's prior defaults, to the extent susceptible of being cured. 3.9 OTHER TERMS AND CONDITIONS: The forme of New Lease shall include other terms and conditions that are normal and customary for similar projects and as agreed to by Hyatt and City. 4. PUBLIC FUNDING; City shall reasonably cooperate with and assist Hyatt in obtaining available governmental incentives (such as. by way of example, sales tax relief on construction materials, TIF.type incentives, etc.) in connection with the New Lease and the investment by Hyatt in the redevelopment or the Property. 5. COMMUNITY OUTREACH AND STAKEHOLDER ME€ TFNCs: The Ground Lease Shall set forth the parameters and the Parties' respective roles and obligations related to all community outreach and stakeholder meetings to be conducted in connection with the Zoning Entitlements or otherwise related to the design and development oldie Project. REAL ESTATE BROKERS; CBRE was hired by the City through State of Florida Contract MIS-I2113-atr7.A. Myatt intends to engage CBRE in connection with the. Project. Other than CI3RE, Inc. whose duties and loyalties are solely to the City, no other real estate broker or consultant to whcnn a commission or fee shall be due lias beets engaged by either party, Upon execution of the New Lease by the Parties, City shall be responsible to pay ro CBRE, inc. as part of its development costs a commission for the New Lease as is set forth in a separate agreement between CBRE, Inc. and the City. City and Hyatt acknowledge CBRE.'s representation of the City and agree that the Maw Lease or other agreement between the Parties to acquire the Property will include said conimissianagreement byreference. Hyatt shall beresponsible for costs associated with 1•lynti's direct engagement of CBRE for all new development (including.the construction or reconstruction or hotel and any uddilionl development on the Property pursuant to this Term Sheet pursuant ro a separate agreement between Hyatt and CBRE, EXISTING LEASE TERMINATION: *Tlte Existing Ground Lease and related agreements will be terminated effective as of the Effective Date; of the New Lease, with each Party relcasiug any eta kis (whether known or unknown) against the. other Party, a. CONVENTION CENTER MANAGER Tite Masan ieincot att:reemen[ for the Convention Center with the current manager will be terminated as of the Effective Date or the New Lease. with Lessor paying any outstanding fees and any required termination fees. 9. PRORATION'S: Real estate taxes, special assessments, utilities, rents and other amounts will be prorated as of the Effective Date in a usual and customary manner for a transaction of this type, i 0. TITLE: As ot'the Effective Date ol'the New Lease, the Property will be leased free .of any liens and mortgages and any leases, tenancies or occupancies, or any other encumbrances, or any defect: in title to the Property that are not accepted by Myatt hi accordfrnce with the terms of the New Lease and will be subject to receipt-of.a satisfactory title insurance policy, 6 1 1. REPRESENTATIONS AND WARRANTIES: Each Party will make customary representations and warranties to the other Party for a transaction of this type, as oldie date of the execution of the New Lease. 12. COVENANTS. Each Party will agree to customary covenants for a transaction of this type. 13. PROPERTY CONVEYED "AS IS": Exeept as specifically set forth in the New Nw Leose, the Property will be conveyed in "as is" condition. 14 TRANSACTION COSTS: The City shall be responsible for the payment of all transfer taxes and recordation fees and the title insurance premium All other transaction costs will be paid in accordance with local custom for similar huge commercial hotel transactions. Each party will pay their own attorneysfees, 15. DELIVERIES: At or 'eThe Effective Date of the New Lease, City will agree to properly execute and/or deliver (i) the Nevi Lease, (ii) an assigninerti and assumption of intangibles, (iii) a bill orsale, (iv)an assignment and assumption of all operating agreements, equipment leases, services contracts and other leases and subleases related to the Property (to the extent accepted by Hyatt in the New Lease) (the "Agreenients"), (v) estoppels for the benefit of Hyatt as reasonably requested by Hyatt, (vi) a..11 other customary documents rease.na.bly necessary from City to complete the New Lease. Hyatt will properly execute end/or deliver (i) an assignment and assumption of all Agreements, CO an assignment and assumption of intang,ibles„ (iii) a, bill of sale, and (iv) all other customary doeuments and funds reasonably necessary from Hyatt to complete the New Lease. 16. MISCELLANEOUS: 16.1. DEVELOPMENT PRO FORMAS: Hyatt provide the. City with development pro retinas for renovated existing or new hotel and any other mixed use development to occur on the site. 16.2. COMMUNICATIONS: The New Lease shall establish a communications protocol (e.g., reports, meetings,. designated representatives) to maintain open and continuous lines of communication between the Parties with respect to all design, entitlement, development and programming activities related to the Property. 16.3. DISPUTES: All disputes under the New Lease shall be resolved pursuant to procedures to be set forth in the New Lease. 7 16.4. DEFAULTS AND REMEDIES: The New Lease will set forth provisions governing defaults by the Parties thereunder and will set forth the remedies available to the non.default ing Party in the event of a default. 15.5, NO ASSIGNMENT: Except as set forth in Section 3.7 above, neither Party shall be permitted to assign, transfer or otherwise convey its interests, rights or obligations under the New Lease without written approval ot'the other Party, This Term Sheet does not constitute an offer to lease the Property and is not subject to acceptance, nor are any of the terns contained herein binding, on either of the Parties. Furthermore, this Term Sheet does not obligate either Party to proceed with a transaction in any way whatsoever, There shall- be agreement only when the. Parties execute: a NOW Lease. Without limitation of the foregoing (A) Hyatt and City specifically acknowledge that no Party shod have any obligation of any kind or nature to the other Party unless and until such Party actually executes and delivers the New lease and ([3) Hyatt and the Ciry reserves rho right at arty tiote to withdraw from farther negotiation or consideration of the transaction contemplated hereby for any reason or for no mason in Hyntt's or the City'`s sole and absolute discretion without lhibflity of'any kind or nature to the other Party hereto. 8 SUBSTITUTED. RECONCILIATION AGREEMENT This agreement to reconcile certain disputed issues and provide mutual releases ("Ag r in.en.t"), is entered. into this day of , 2017, between the City of Miami, a Florda municipal corporation, ("City") and Hyatt Equities, L.L.C., a limited liability company doing bu. ness in Florida ("Hyatt") (collectively the "Parties"). WHEREAS, the City is the owner of the James L. Knight Convention Cet .. r located at 400 S.E. 2"6 Avenue, Miami, Florida 33131 ("Convention Center"); and WHEREAS, per the Lease agreement originally dated September , 1979, as supplemented, amended and assigned from time to time (collectively, "Lease Document ), Hyatt currently leases the property adjacent to the Convention Center from the City, and is the owne of the hotel structure known as the Hyatt Regency Miarni and located at 300 SE 2'"' Avenue, Miami, F1• icla 33131 ("Hotel"); and WHEREAS, the 'Parties. agree that an upgrade to the curs it fire alarm system located on the Convention Center property, which supports the,Hbtel and the Con ention Center and the ancillary systems located within each of the Convention Center property and Hot property (collectively, the "Fire Alarm Project"), is necessary for the proper operation of the Hotel an r Convention Center; and WHEREAS, the Parties agree that the tiles, at the . terior of the Convention Center located on the main level at the plaza entrance of the Convention Ce er along S.E. 2nd Avenue, as described in the documents attached hereto as Exhibit_A and made a p t hereof (the "Flooring Repair Area"), are in need of .replacement and the water damaged areas to the otel and its personal property located on the ground level of the Hotel, resulting from tho detective tit are in need of repair anclior replacement (the "Tile Project") for the proper operation and maintenan of the Hotel and the Convention Center; and WHEREAS, the Parties agree that e HVAC on the third floor of the Convention Center (the "HVAC Project") is in need of repair fo he proper operation and maintenance of the Hotel and the Convention Center; WHEREAS, the Parties agrthere is an on -going and present dispute regarding the amount of certain concession fees (the "Con' scion Fees") and other fees related to increased room rental rates, restroom attendant, overtime rate•, durapster fees and cleaning fees (the "Other Fees") as described in the letter dated November 12, 2012 rom Hyatt to the City attached hereto as Exhibit .13 and made a part hereof (the "November 12, 2012 Lett ") charged by -the City to Hyatt forme of facilities at the Convention Center; and WHEREAS, tl Parties agree that there is an on -going and present dispute regarding the amounts owed by each Party t maintain the Physical Plant ("Maintenance Costs") from January, 2012 through the present date; and WHE ' AS, the Parties agree that there is anon -going and present dispute regarding the amounts owed for the oling tower and chiller replacement project undertaken by Hyatt ("Chiller Overpayment") and outstan+ ng credits to Hyatt relating to depreciation payments made by Hyatt pursuant to the Lease Doeunzen . ("Depreciation Credit"); and WHEREAS, the Parties agree that there is an. ongoing and present dispute regarding, the amounts owe • .for certain Phase I design fees for the upgrade of the fire alarm system (the "Phase I Design Fees"); an WHEREAS, the Parties intend to redevelop the Convention Center and, in connection extend Hyatt's lease with the City for the Hotel and modify the Lease Documents to include things, the Convention Center, as otherwise described in that certain Memorandum of between Hyatt and the City dated , 2017, and attached as Exhibit C (the "R and • WHEREAS,. the Parties acknowledge and agree to the resolution, compro alt such disputes, cIahus and controversies among them as provided herein; and NOW THEREFORE, in consideration of the mutual promises and cov nants receipt and sufficiency of which is hereby acknowledged, the Parties agree as •flows: 1, Recitals. The Recitals set forth above are incorporated herein. 2. Agreement Terms. erewith, ong other nderstanding development") e and settlement of set forth herein, the A. City's Contribution. The City shall pay Hyatt T o Million Two Hundred Sixty -Eight Thousand Two Hundred Seventy -Nitre Dollars ($2, .8,279.00) ("City's Contribution"). The City shall use commercially reasonable efforts .o pay the City's Contribution to Hyatt following the execution of this Agrecmct no la r than sixty (60) days from the date hereof. The City shall have no liability- or obligation t+ pay any sum or cast whatsoever in excess of the City's Contribution with respect to the Pr►lects described below, except in the event of an increase- in costs due to the action or in Lion of the City contrary to the terms of this Agreement or the Lease Docutnetns, deli s caused by the City or related parties to the City or force majeure, Hyatt shall have no li ility or obligation to refund all or any. portion of the City's Contribution even if the costs o the Projects described below are less than anticipated. Except.as otherwise expressly provi d herein, should the. total amount of,n Conies requiredby Hyatt to complete the Projects be 0) in excess of the City's Contribution, Hyatt shall, at its sole cost and/or expense, compl7 e the Projects using Hyatt's independently acquired funds or (ii) below the City's Canal tion, all such excess of the City's Contribution shall belong to Hyatt. If the City fails t nake the City Contribution.paytnent in accordance with this subsection A, Hyatt May cl duct such amount from the next rent payment under the Lease Documents, and each ren payment thereafter, until the fill balance of such amount owed by the City to Hyatt has be,. paid in full. B. Maintenance and Concession Pees. The City shall TOSO pay Hyatt a total amount equal to Seven Hundred S enty-Eight Thousand Seven Hundred Twenty -Two Dollars ($778,722.00) to resolve the dis ter regarding the Maintenance Costs and Concession Fees. If the City fails to make such p yntent by the time Hyatt's next rent payment under the Lease Documents is due, Hyatt m. deduct such amount from the next rent payment under the .Lease .Documents, and each re t payment thereafter, until the full balance of such amount owed by the City to Hyatt has een paid in full. C. Other 1 utstan€ling City Fees, The City shall also pay Hyatt a total amount equal to Eight Hun , red Forty -Five Thousand. Six Hundred Sixty -Seven Dollars ($845,667.00), to resolve the di, rutes regarding the Chiller Overpayment, the Depreciation Credit and the Phase I Design es (the "Outstanding City Amounts"). The Outstanding City Amounts shall be paid by the ity to Hyatt in connection with the Redevelopment and any agreements entered into between Hyatt and the City, with respect to the Redevelopment, shalt provide for the payment of the Outstanding City Fees. to Hyatt. If the Redevelopment is not approved by City Commission D. andlor by referendum in calendar year 2017, if the agreements with resp Redevelopment are .not entered into by the City and Hyatt (following appi Commission and referendum) on or before December 31, 2018 or discussio City and Hyatt regarding the Redevelopment plans otherwise discontinue fo Outstanding City Amounts shall become immediately due and payable b upon written notice from Hyatt to the City. If the City fails to .make su Amounts payment to Wyatt within sixty (60) days of receipt of such wri deduct such amount from the next rent payment tinder the Lease D payment thereafter, until the full balance of such amount owed by paid in full. Projects.1-Iyatt-s shall complete the Fire Alarm Project, the Til (collectively the "Projects") pursuant to a scope of wor ("Specifications"), and further corresponding to the Flo Hyatt for the Projects. Additionally, if bonds are requir Florida Statutes, as this is .City -owned property, Hyatt s The Specifications, the selected contractors and th consulting, construction contractors shall not be sub contracts complying with the requirements of sub of the Specifications and the final, executed col the Projects. The parties acknowledge and agr and Rolf Jensen & Associates, Inc., for the selected. for the Fire AIarm Project and tha and Building Consultants, Ltd., for th selected as the contractor for the Tile P to cause the Projects to be perfornnec the Specifications and in compl.iaii and industry standards. et to the al by City between the any reason, the the City to Hyatt Outstanding City en notice, Hyatt may uments, and each rent City to Hyatt has boon roj ect and the HVAC Project and plans and specifications ng Repair Area, determined by for the Projects per section 255,05, all obtain such bonds for the Projects. contracts with the .respective design, et to the City's approval (subject to such etion F below)., Hyatt shall provide copies races with all consultants and contractors for that Sicilians Industries, Inc, as the contractor, esign and related work, have been preliminarily. ompletc Property Service, Inc., as the contractor, design and related work, have been preliminarily ject. Hyatt shall use commercially reasonable efforts in a good and workmanlike manner in accordance with ith all applicable governmental laws, rules, regulations E. Schedule. Hyatt shall use mmerci.al.ly reasonable efforts to cause the Projects to be performed and completed i F accordance with a schedule (the "Schedule") that will minimize disruption of the Hotel a r Convention Center operations, provided that commencement of the Projects shall begin ithin months of the execution and approval of this Agreement (subject to Section I •Glow) (the "Commencement Date") and be substantially completed within montl of the Commencement Date, subject to extensions due to force majeure, City caused delay,, and other events outside of Hyatt's reasonable control. Time is of the essence. In no A nt shall either Party be .liable to the other for consequential, punitive or special dainag associated with any delays in the Projects. F, Project C+iitract Requirements (Including Insurance and indemnification). Any construction contracts and/or other contracts entered into by the Hyatt to complete the Project , shall (i) provide that such contract may be assigned to the City, subject to Hyatt approal, which shall notbe unreasonably withheld, delayed or conditioned (ii) that the City sha be named as an additional insured on all applicable liability policies along with loss p ee or co-insured, as applicable, as to property insurance and dual obligee as to bonds, if plicable on this project (iii) that all contractors must be licensed, certified, and insured, and all insurance carriers must be rated A- or better, and (iv) such contractor shall indemnify, .hold hanraless and defend the City, in addition to Hyatt, as set forth in such agreement; however, the City shall not be liable for or a guarantor for the }Tyatt's obligations under such contract. G. Concession ;Fes; Maintenance Fees. From and after January I, 2017, through t of the Terra under the Lease Documents, Hyatt shall promptly pay the Cone connection with its rental of meeting space in the Convention Center and as p by the City in accordance with the rates set forth .in Chapter 53, Section Miami Code of Ordinances (which currently provides for $100 fo food/beverage concession and $200 for a single permanent food/beverat and after January 1, 2017, through the remainder of the Term under t City agrees that it shall promptly pay its portion of the Maintenanc the maintenance of the Physical Plant in accordance with the Lease invoiced by Hyatt. e remainder ion Pecs in perly invoiced 1 of the City of a single portable concession). From Lease Document, the .ees in connection with moments and as properly H. Reasonable Cooperation. Hyatt and the City shall reasonal y cooperate with each other in connection with the Projects stated herein, including, , the ity providing reasonable access to the Convention Center during' the period of construction and installation of the Projects and coordination of the work as as to tninirnize disrupti.o to the operation of the Hotel and Convention Center, the City providing reasonable and 'nxely approvals of all. permits required for the Projects and the City providing reasonable a d timely inspections of the Projects, in accordance with the Sohedule. Hyatt shall obtain e City's prior approval of shut downs of power, water, and HVAC, use of loading docks, t ocka.ge of circulation areas, and within the Convention Center. If the City does not respono a request for such approval within ten (10). business days of such request, the-City's appr al shall be deemed to have been. obtained, The Director of Real Estate and Asset Manager,:ent for the City will serve as the City's contact person, and the City Manager, subject t. compliance with authorizations, procedures and requirements prescribed by the City C. arter, City Code, and the directives of the City Commission, shall act for the City as t all approvals from the City referenced herein. 3. Depreciation Payments under the i,e; 'e Documents. The Parties hereby agree to waive the obligations under Section 7.4 of the LF se Documents of Hyatt to pay towards a reserve to make depreciation payments in connection ith capital costs associated with the Physical Plant and the City to furnish an analysis of such ' pital and depreciation costs on an annual basis. 4: Breach of Agreement, In the ev zit that either of the Parties fails to fulfill its obligations (and such failure is not due to force maje re, the action or inaction of the other Party, and other events outside of such Party's reasonable control), and after the expiration of all notice and cure periods as set forth herein, the violating i. rty shall be deemed to be in default of this Agreement. As a result of a default, the non-viol.ati€ Party shall be entitled to pursue any and all. remedies permitted under law and in equity upo he expiration of a ten (10) business day grace period following written notice to the other P. ' y as set forth below in Section. 9; provided, _however, with respect to the Projects, so long as . yatt has commenced to cure any default related thereto following notice from the City and is dig .ently pursuing to cure such default, Hyatt shall have such additional period of time as reasonab necessary to cure such default, 5. Mutual Rele. ses. Upon execution of this Agreement by the Parties and approval ofthis.Agreement by the Mia City Commission, the fallowing shall be effective: A. ity's Release to Myatt: Except. for the rights, duties and obligations of Hyatt created under this Agreement, the City, for itself and its predecessors, agents, directors, officers, members, employees, affiliates, successors, assigns, trustees, bankruptcy traustces, personal representatives, beneficiaries, devisees, and legatees (hereinafter collectively referred to as the "City Releasors")., hereby releases and forever discharges Hyatt and each of its respective subsidiaries, predecessors, agents, managers, attorneys, directors, .fficers, employees, affiliates, successors, assigns, trustees, bankruptcy trustees personal representatives, beneficiaries, devisees, and legatees (hereinafter referred to the "Hyatt Releasees"), whether past, present or future, jointly and severally, of and fr .nz any and all debts, claims, demands, actions, causes of action, rights, obligation damages, and liabilities of any and every kind or nature whatsoever, in law or in equi -, past, present, or future, known or unknown, direct or indirect, asserted or unasserted ixed or contingent, whether contemplated or not, whether basedin tort, contract, cot 'bution, or any other type of recovery, and whether for compensatory, consegnenti:., incidental, statutory; punitive, or other damages, which the City Releasors have, may ave or had arising out of the following claims: (I )the Fire. AlarmProject, (2) Tile Pr.'ect, (3) HVAC Project, (4) Concession Fees, (5) Maintenance Costs, (d) Other Fees, 7) cooling tower and chiller replacement project including, , the Chiller Overpayment .nd. the Phase l Design Fees, (8) depreciation payments including without limitation the epreciation Credit (collectively, the "Released Claims"); provided, however, that this elease by the City Releasers does not release any Claims other than the Released Clai 13, Hyatt's Release to the City: Except for the rig ts, duties and obligations of City created under this Agreement, the I-Iyatt, for 'itself an. its predecessors, agents, directors, officers, members, employees, affiliates, successors, . ssigns, trustees, bankruptcy trustees, personal representatives, beneficiaries, devisees, al 4 legatees (hereinafter collectively referred to as the "Wyatt Releasors"), hereby releas.. and forever discharges City .and each of its respective subsidiaries, predecessor agents, managers, attorneys, directors, officers, employees, affiliates, successors assigns, trustccs, bankruptcy trustees, personal representatives, beneficiaries, de . sees, and legatees (hereinafter referred to as the "City Releasees"), whether past, press t or future, jointly and severally, of and from any and all debts, claims, demands, act'.ns, causes of action, rights, obligations, damages, and liabilities of any and every lid or nature whatsoever, in law or in equity, past, present, or future, known or unknow., direct or indirect, asserted or unasserted, fixed or contingent, whether contemplated 3 not, whether based in tort, contract, contribution, or any other type of recovery, an whether for compensatory, consequential, incidental, statutory; punitive, or other d$ nages, which the Hyatt Releasors have, may have or had arising out of the Released C ims; provided, however, that this Release by the Hyatt Releasors does not release any laims other than the Released Claims. 6. No Admission. of I ' bility. Each Party expressly recognizes that this Agreement shall not in any way be construe c as an admission by any Party hereto of any unlawful or wrongful acts or omissions wha , a ever with respect to the Released Claims stated herein. This Agreement shall not be admissible ` any proceeding as evidence of any admission by any Party hereto of any violation of any law o regulation or wrongful act or omission. This Agreement may, however, be introduced as evictor' in any enforcement proceeding to this Agreement. 7. Non- ssignahility of Transferability of Claim. Each Party hereby warrants, declares, and rep seats that no part of any asserted and/or assertable claims has been assigned or transferred, ar that each Party has full, exclusive, and unencumbered right, title, and interest in and to such serted and/or assertable claims. Governing Law and Venue. This Agreement shall be governed by the laws of the State of Florida. The Parties acknowledge that this Agreement is being entered into in Miami -Dade County, Florida and that the jurisdiction to enforce the terms of this Agreement shall exist in. the Eleventh Judicial Circuit, Miami -Dade County. The Parties expressly select, as their venue, any a all a ction/litigation in Eleventh Judicial Circuit, .Miami -Dade County of the State of.FloriIt is further acknowledged and agreed that any claim, dispute, action (administrative or o erwise), and/or litigation relating to this Agreement, that the Parties shall bear, at their sol- respective expense, their own attorneys' fees and costs. 9. Notices. Except where this Agreement expressly provides otherwise, all .a +ticcs and other communications required or permitted under this Agreement shall be in w ting and shall be deemed to have been duly given (a) on the earlier of the date received or thr business days after delivery, if sent by registered or certified mail (return receipt requested); b) when delivered, if delivered personally; (c) on the next business day, if sent by overnight m- . or overnight courier. if any Party is represented by counsel (whether or not named .in this Agre rent), any notice given by such counsel for such Party shall be fully effective as if given by su Party. Any notice shall be given to the recipient at these addresses (.or at such other addresses shall be specified by written notice given in accordance with this provision): CITY OF MIAMI City of Miami Office of the City Manager 444 SW 2 Avenue, 1010 Floor. Miami, FL 33130 With n copy to: City of Miami Dept, of Real Estate & Asset MG agement 444 SW 2nd Avenue, Suite 32 Miami, FL 33130 City of Miami Office of the City Att•.. ney 444 SW 2 Avenue. Miami,FL 33130 ite. 945 10. Miscellaneous. The P rties further agree as follows: HYATT Hyatt Equities, L.L.C. Hyatt Center 71 South Wacker Drive 1 T1 Floor Chicago, IL 60606 Attention: Megan Schrollinger With a copy to: Hyatt Corporation 71 South Wacker Drive 12fi` Floor Chicago, IL 60606 Attention: General Counsel A. No waive of any breach or default hereunder shall be considered valid unless in writing and sign d by the .Party giving such waiver, and no such waiver shall be deemed a waiver of any .'ubsequent breach or delimit of the same or similar nature. 13.. Ea' r Party hereto shall cooperate, shall take such further action and shall execute and liver such further documents as may be reasonably requested by any other Party in order to carry out the provisions and purposes this Agreement. This Agreement may be executed in one or more counterparts, all of which taken together shall be deemed One original. D. In the event any terms or provision of this Agreement be determined by appropriate ,jt+'vial authority to be illegal or otherwise invalid, such provision shall be given its legal eaning or be construed as deleted as such authority determines, and the remind s of this Agreement shall be construed to be in full force and effect. E. Any approvals required by the Parties under this Agreement shall not unreasonably withheld; conditioned or delayed. 11..Knowing and Voluntary. The Parties acknowledge and represent that tit- have carefully read and fully understand of the provisions, terms and conditions of this Agree + ent and have reviewed this Agreement with their respective counsel. The Parties further ackno ledge and represent that they have entered into this Agreement freely, knowingly and without ercion or duress and based on their own judgment. 12. Successors. and Assigns. This Agreement shall be binding ups i and inure to the benefit of the Parties, their personal representatives, successors, and assigns 13. Interpretation, The Parties hereby acknowledge -and agre that; (a) in the negotiation and drafting of this Agreement, they have each had the opportunity t , consult with counsel of their choice; (b) each of their counsels has had an opportunity to contr. )ute to the negotiation and drafting of this Agreement; and (c) the principle of construing a doc lent most strictly against its drafter shall not apply with respect to the interpretation of this Agr. r►tent. 14. Entire Agreement. This Agreement constitu .' the complete understanding between the Parties with respect to the subject matter hereof an supersedes all prior agreements, understandings and arrangements, both oral and written, betty=-iz the Parties with respect to such subject matter, This Agreexneiat may not be modified in any ay unless by written instrument signed by each of the Parties. 15. Authority to Execute. The Part represent and warrant that the individuals executing this Agreement on each Party's beha have the full authority to do so. 16. City Commissions Approv 'This Agreement is subject o the review and approval of the Miami City Commission and therefore this Agreemer shall be effective as of the date of execution by the City after obtaining such approval. [Signatures on following page] CITY OF MIAMI, a municipal corporation Attest: Daniel I. Alfonso, City Manager Todd B, Hannon, City Clerk APPROVED AS TO LEGAL FORM AND APPROVED AS TO P'SURANCE CORRECTNESS: REQUIREMENTS: Victoria Mondcz City Attorney HYAT`r EQUITI S, L.L.C. By: Its: Ann -Marie arpe :Risk.Man ement :Director ttest: Printed Name :Printed Name Exhibit A Flooi•ing Repair Area [Attached] TERRACE HY TT REGENCY' WATERPROOFING REPAIRS HYATT REGENCY MIAMI 400 SOUTH EAST SECOND AVENUE MIAMI, FLORIDA 33131 NOTES KEY PLAN ` acwe3 e.xxe ecu+ tThZ N..,T( .naon sri.�n ••..,..oai ee ..01.--e.2-.$ L "'AM..1c•w:txeast'm1A....aawaY.uaa,.c»Ta} LlWenae. azm..ataz,..ILWNDo..nCWp^,u...rm..:., IMAM..7..Paeoew.cemz,.e..e.v;rav rW7o. CS !ICoisw.ueGc x. ,e.t.....•mcmxawoe.ca. p. •.-ne.c..R.e.. .,....v,,...'eie*N..7Lelf MI 000,002001'.6 49mN.GtGNSAbrra. Ml.Rltl'fEs ftw'4 T POM ITMenmearrpxa Cr.am+l.aro, n+ •w�mane ,nou,nswm.uz^+nwr+ L. ..213.11 :'a.ntvea a PAw...,....rar�r ...MI aaFie.+stlaeraro .+ +s..n•arovaw %=aix.rcc.cerwa.�aertm 'er ...TVA #ye1y © anaa .. . ,�j. ^. .. . 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MIRIe+G AAdfs6LCE3'#:K m.m.S;! t1 fS M t€ (/1\•] "'"'^If AV4p1TCN.tiR3t WA 9CLl9ar,:% sywt•....4VAe•.� NWT AEGErd: r.xePq% .kL1R47M 1O „.�......wtA.FW.4. .ees..aF} M nx y t .e�®Ie(.Q,"4. 1.1MTrN., Jl- au1aE+L Likag ,r,11 Wh13C KC�laap�'Ft+4txp�ppJQ .11, i•.II:Pe•s 4.909, 11.1.19� AE"6ve.:NG.11 •p��'�� ���� ��,,..�� �C�{ 71 . UNA Oe^.wR. gmsp ."Cr..4.1,11 01.614.1.C., ...X xmr 0 Dgmcz1rF�HK17ES a ..uox.wcwm, sc,. um»n+ree-,.� n. m KEY PLAN ...r . a hNr...aK [j xznpw.rmx.u.war'..oenR.m+�.�-o• 4Ng92xw 24,.....setwiceocme,mmwe .w>ei..oaer..s Lyrae rt,.c. ...MaW mam.q m .cw.a..vowuvo MT. W-4.1140 rn.mw - —...� Ti7L� 'aNS ET, KEY- PEW' ,'. m eno - - DRAWING INDEX Arm A'0"ES rl .r,rriwl+ce.nr axanaeRa"owerv..za.-+,��¢. sNaa.�V+ AC 17:1- $`k#�KEYRL.4+l fiSS 1^ '.'E� 9 1:i wc wpm rWp..b.R . .4.4 TaFi 4CFl77V..�mrvwa- Inc Fei$ fi 3VA�6FIC>rc A$ ?H1;177.9 .a„ r0 Fa i f d i, TYT'IC.ILTERCCE SECT{Cil T##N 1�? 11LE 7,aaat AT RANTER WALL f rtcr-tr If..i., .1-; , i 1r ka f I 1 OTYPICAL EXPANSION PUNT DETA;L Ra-t�x ./ 1 1 b ®.D. =o "-AT BUILDING WALL ' h • re re le r 1 LANTER DRAIN CEtAL 5 Aar. s TYPiCAL PRE CA$T PANEL JCtNT L AT CJ 0 T'YPICALTER DRAIN DETAIL rQ@ TENRACE SECTION '�� =W-fTii CPNCREif= WEARING sua ▪ .06 TEPWACL IYAfCPPRoon NG Krt"r RREuNCT 411v.11 w +.s neon. W. 6 Exhibit B November 12, 2012 Letter [Attached] Kuria L. P , wd Sertkti *4Umei 7 i South Wee . r DUtive Chicago IL r$606 USA T: 12,780.5467 November 12, 2012 -Via Egmiail (httorre.tyriamicov.cf) Mr. Henry Torre, Director City of Miami Public Facilities Division !Asset Management Division 444 SW 2nd Avenue, 3rd door Miami, Ft. 33130 Re: Hyatt Regency Miami (the "Hotel"); Lease an w Agreement for Development dated September 13,1979 (the "Lease") bet en the City of Miami (the "City") and Hyatt Equities, L.L.C. ("Hyatt"), as a # nded; Operations and Maintenance Agreement between the City and Hyatt ' f &M Agreement") Dear Henry: [ am writing to follow-up on the ou. , tiding matters following our conference call on August 29, 2012 (the "August 29 Cal ) and to respond to your offer of tr one-time waiver of overtime charges of $28,000 in change, l believe, for Hyatt's payment of $302,000 in concession fees billed by the Cit to Hyatt, which fees have been disputed by Hyatt. We assume this offer by the City a so Includes FIyatt agreeing to pay concession fees in the future. Assuming these are <e terms of the offer, Hyatt does not accept the City's offer. First, it is Flyatt's position at the concession fees are not properly due and payable and have been wrongfully eh ged to Hyatt by the City. Second, the City has not responded to Hyatt's request made + k 'ng the August 29 Call for a legal analysis as to why the City believes the concessi► fees are due and payable by Hyatt. Third, the City's offer does not address the other f s which are disputed by Hyatt, and for which the City, during the August 29 Call, eed to provide a response, and has failed to do so. All capitaliz`' terms used herein, and not otherwise defined, shall have the meanings ascribed to em in the Lease or O&M Agreement. The fol •wing Hems are in dispute by Hyatt and were discussed during the August 29 Call. Man items, as noted below, require a response from the City. Henry Torre November 12, 2012 Page 2 of 5 Concession Fees The City has wrongfully charged, and continues to wrongfully charge, Hyatt a concession fee for events (ticketed and non -ticketed events) at the James L. Knight Center wh Hyatt is the exclusive concessionaire (per the Lease) and not the user of the Space and en there is a third party user renting the space. The concession fees charged to N; art are not supported by City ordinance, the Lease, the O&M Agreement or custom and ractice in the industry. City Cody; Sec. 53- t 81(1)(a) created a new category of charges or food/beverage concession with respect to meetings or general sessions in the Th s r/Auditorium. The ordinance shows the concession fees as a charge for sae of the 1 aater/auditorium space and not a$ a charg efo the concessionaire. Moreover, per the 0 sinance, this charge does not apply to exhibits or ticketed events in .the Theater/audi •rim, Yet, the City has charged Hyatt as the concessionaire for what is clearly a us-: ee under the Code and has charged for all events (ticketed and non -tickets), in vioiatio 'f the Code, Section 8.3(a) of the Lease establishes Hyatt as the se provider of food and beverage. services for the Convention Center, without charge or fee for this privilege. Hyatt bargained for the right to be the sole concessionaire d the sole consideration for that right is the Lease itself. The City's charge of canoes on fees to Hyatt for its concessionaire services is also in violation of this provision of Lease. Correspondence froth two Assistant Ci Attorneys states that these concession charges were established to defray, at le in part, the City's clean-up costs incurred as a result of patrons bringing food and be rages (supplied by Hyatt or its predecessor as concessionaire) into the Auditorium. However, per the O&M Agreement, both the Auditorium and the Exhibit HaII . < in the City's areas of responsibility. Accordingly, pursuant to Sec. 1.5 and 4.1 of the •&M Agreement, the City, not Hyatt, is to keep these facilities in "good and clean orde • and condition." The Lease and the O&M Agreement do not support a clean-up fee to H tt in connection with its concession services. If the concession charges TirSec, 53-181(1)(a) of the Code (concession charges for meetings or general sessi s in Auditorium) apply to Hyatt at all, they should only apply if Hyattis the lessee of t Auditorium for a non -ticketed meeting or general session. They should not apply to yatt when a third party leases the Auditorium and Hyatt acts as caterer. Custom and p tice in the industry do not support the charge of the concession fees to Hyatt, as the oncessionaire, Auditoriums similar to the James L. Knight Center (Bank United Cen r, Jackie Gleason Theater on Miami Beach and the Adrienne Arsht Center) do not chargT any concession fees or clean-up fees to their concessionaires, Rather, any concess n fee or clean-up fee is charged to the third party user/renter of the space and/or includ in the rental fee, P'1; =.e advise as to the City's basis for charging Hyatt the concession fees pursuant to the ode, Henry Tone November 12, 2012 Page 3 of 5 Meetink Roam hates The City increased the rates being charged Hyatt for use of meeting spa at the Convention Center; however, such increase was not supported by City Code. •ontrary to the City's assertion that increases to meeting room rates at the Convention C nter are not subject to City Commission approval and do not require an amendment to e City Code, the rents, rates, fees and charges for the use or occupancy of and for the s ices furnished in connection with the Convention Center are clearly established by ty ordinance arid presently codified in Section 53-181 of the City Code. The establisent of such rents, rates, fees and charges for the Convention Center is the province of ie City Commission and there is no delegation of that authority to the director of the Co ention Center. In fact, Veronica Xiques, Assistant City Attorney, in her letter o me dated May 10, 2011, clearly advised that "[T]he City Commission establishes ren si fees for the Knight Center and all entities using the facilities must comply." Moreover, the City's own website for the Conventio Center lists a fee schedule for meeting space rentals less than the amounts charged att for the same space, in violation of the Lease. Section 8.3(b) of the Lease provide that the rates and charges for use of Convention Center by lessee must be the same as ; ose charged to third parties. Yet, Hyatt is being charged more than the rates advertised t ird parties. At one time, the City asserted that the incr ased rates were for equipment charges, and cited City Code Section 53-181(1)(d), Sec on 1(d) of City Code Section 53-181 provides for charges for certain "anti ary services" with respect to the T['heatreatidltorium. Among the itein dentif'ied in paragraph 1(d) are "event personnel," "Equipment rentals," and certain "0 'er services-- Police and Stagehand." The increased charges by the City are clearly fo meeting space, not equipment or ancillary services. Moreover, Section i (d) only appi' ° s to the "Theater/Anditorium rates." Section 1(d) does not apply to "Meeting and semi ;.:.• space" (Section 2) or "'Exhibit Hall" (Section 3). Please advise as to the City'. basis for increasing fees for the meeting space without first seeldng City Commission approval and an amendment to Section 53-181 for theater and auditorium rates, and fx charging rates for the meeting space to Hyatt in excess of those being charged to third es. Cleaning Fees. The City char es Hyatt a $500 cleaning fee .for any concession event held in the Convention rater. Hyatt is the sole concessionaire under the Lease, and there is no charge for : s right. Any charges the City wishes to recoup should be charged to the third party user Moreover, there is no support for this charge in See. 53-181 of the Code. The y also charges a clean-up fee for damage such as carpet and wall stains. This fee sho., d be governed by the use agreement between the City and the user. Hyatt, in its ca -achy as concessionaire, should not be charged this fee by the City if it isn't the user. Henry Torre November 12, 2012 Page 4 of 5 During the August 29 Call, the City conceded that these fees should of be charged to Hyatt. Please discontinue the City's charging of these fees to Hyatt mediately. Hyatt reserves all rights and remedies with respect to these charges under t Lease, at law and in equity. Restroum Attendant. The City charges a restroom attendant fee when Hyatt rents certain facilities. There is no support for this fee in Sea. 53-181 of the Code. This sery e is included in the rent for the facility and should not be ndditionalIy charged. During the August 29 Call, the City conceded that ese fees should not be charged to Hyatt. Please discontinue the City's charging of se fees to Hyatt immediately. Hyatt reserves all rights and remedies with respect to th :e charges under the Lease, at law and in equity. Reltlstrxarr,e. The City recently advised Hyatt that it w Id increase the charge from $50 per day to $100 per day for any Hyatt function that us s a registration table that Is outside of the leased room and on City space. Sec. 53-181 ' ) of the Code permits a $50 per day charge. We are not aware of any ordinance increasi i the amount of the charge. During our August 29 Call, the ! ity agreed to review and respond to Hyatt. Hyatt has not received a response. Overtime Bates. The City advised that it '11 charge overtime rates for events that exceed eight hours, occur on weekends, or IN 're special needs. There is no support for this charge In the Code; except to the e ent these charges fall within the ancillary services to the Theater/Auditoria' that are permitted by Sec. 53-181(1)(d). During our Au. st 29 Call, the City agreed to review and respond to Hyatt. Hyatt has not received a onse, other than the offer of a one-time waiver. However, no basis for why these char s are proper has been provided. het d Break , own iverf_ Hall. Sec on 8.4 of the Lease requires the City to maintain and operate the Convention Center n toad clean order and condition as a first-class facility. The City is required to maintain d adequate staff to do so. If the City does not so operate and maintain, the lessee may do so and charge back the City. During our August 29 Call, the City agreed to review and respond to Hyatt. Hyatt has not received a response. Henry Torre November 12, 20I2 Page 5 of 5 Maintenance pees due watt The City currently owes Hyatt approximately $43,318.00 for its share of mai for the Central Plant_ The City originally advised Hyatt that it ceased rei for the maintenance costs in an effort to offset these amounts against the claim that Hyatt owes for concession fees. However, as noted abo believe the concession fees are owed and has been disputing these Lease does not provide for a right of offset, Then, during our Augu clear by the City, that the failure to pay these charges was s shortfalls. Yet, the services still being provided to the City, for the City's portion of these fees. Please arrange for the im portion of the maintenance costs that are overdue. nonce costs bursing Hyatt ounts the City e, Hyatt does not ees, Moreover, the 29 Call, it was made by a matter of budget nd Hyatt continues to pay diate payment of the City's Nothing contained herein shall be deemed a waiver of 'y of liyatt's rights and remedies under the Lease or O&M Agreement. Hyatt would appreciate your response to the items ,ted above, Please let me know if you have any questions. Sincerely, Karrie Dowd cc (via e-mail): Dave Phillip Luis Alom Veronica iques Daniel r'ewhoff Exhibit C Memorandum of Understanding (Attached] [Encl of cument_j t f Hl nd March 21, 2017 Tiffany L eadb tter Donato Senior Vice President Capital Strategy, Real Estate Transactions Hyatt Hotels Corporation 71 South Wacker Iarive Chicago, IL 6060d Re: lutcinorandurn of Understanding: (I) Attended and Resta Land Lease Dear Mrs. Donato: Hyatt Equities, L.L.C. tf`)and the City o.rMiami (" ") (collectively, the "Parties") desire to amend and restate their existing land lease relationship, and hav lyntt redevelop the Property (as anticipated and defined in the Term Sheet attached hereto), upon wit' h the existing Hyatt Regency Hotel :and lames L Knight convention center occupy. The: following pa•. graphs set forth the basic terms. and conditions upon which said relationship shall be structured subje to the negotiation and execution of an amended and restated land lease (the "Ne\-v Lose"), and the o er terries and conditions contained in the Term Sheet. At the minimum, saiid•ugreentent is anticipated to 'ncarporate the following: I). The Parties will enter into an int- in agreement with respect to the Existing Ground Lease (as defined in the Term Sheet) to n Tess certain immediate needs of the Hotel between the date of such agreement until the New ease is entered into and the redeveiopnient process commences, including, without liiuhat :oi an agreement oil the payment of certain shared expenses on a going- forward basis and an agree cnt of the Parties to stay current on such obligations during the interim period. 2) The Parties shall iris Extend th Expand space' Am a. b, xl to modify the Existing Ground Lease, including, without limitation, to: d lease term plus extensions to a total of 99 years; re leased premises to include the !runes L Knight convention center/meeting d and restate the parking agreement to accommodate a. and b. above; onjunction with the New Lease and upon termination of the Existing Ground Lease, as .reed by both Parties, resolve and absolve (except to the extent the Parties resolve to have continuing obligations thereafter, such as a payment plan) the Parties from, current disputed financial obligations For capital improvement projects undertaken, revenue and expense sharing agreements and other matters. Any agreed upon payment plan for such outstanding amounts shall be attached to the New Lease and each Party shall comply with sueh payment plan and other agreements made between the Parties in resolution of -such outstanding amounts owed between the Parties.( Hyatt shall redevelop the Property subject to the following: i, Hyatt shall explore the use of the additional development rights on the Property;. ii. Hyatt shall engage directly CBRf;, Inc. to seek qualified development partners to maximize the Property's development potential and density; additional development could include hut not be limited to residential, office, -tail, and/or parking; Seek possible development partners, taking Into consideratron tqualifications and financial capacity of said partners, programmatic and at etic design, and financial benefit anticipated to mire to the benefit of Myatt a the City. iv. The Parties will mutually agree upon a Master Plan (as defii .d itt the Tenn Sheet) 'lbr the redevelopment afthe Property. When fully executed, this Memorandum of Understanding (together with the to nt sheet attached hereto as "Atttrchtnen '° and incorporated herein (the "Terre Sheet"), the "MOU") ra reflect the expression of HHlya.tt's and the City's desire to proceed with the negotiation and possibl execution of a New Lease to include the redevelopment of the Property. Nevi, Lease. Subject to certain conditions es set forth in the MOU b ng satisfied, the Nlew Lease will be negotiated to reflect the intended deal tenets set forth in the MOU. F cclusivit,y. From the date hereof through March 31, 2017 (the Exclusivity Period"), City shall negotiate exclusively with Hyatt: for the redevelopment of these parce ; provided, however, that in the event the Parties mutually agree in writing or Hyatt notifies City in iting of its intention to cease the negotiations prior to such chute, then the Exclusivity Period shall expire n the date of eessation of negotiations. CrtntidentitItirv. The terms of this IvMOU and the New ease, as will as any non-public i.nlorrnation related to the transactions shall be maintained as confidentk by the Parties, except for (i) ttiselasures required by law (specifically inc hiding Florida Statute Chap!. 1 19) or rules :of applicable securities exchanges, (ii) disclosure to the; Parties' respective board meet ars, at}ents, employees, attorneys, accountants, brokers, contractors, lenders, prospective loaders, have: ors, prospective investors, consultants. advisors or outer representatives, and (iii) disclosures that the rties mutually agree in advance are required or desirable to advance Zoning Entitletuents (as defined ' the Tenn Sheet) or other public approvals or concessions or information that otherwise advances the armed development. The foregoing notwithstanding, the Parties agree that any public announcement of . executed transaction (i.e., executed New Lease) shall be mutually agreed upon by the Parties prior to a public announcement. Non-Hinding.. This MOIJ shall t createany legally binding obligations on the Parties, other than with regard to the Exclusivity and C.rt@identinlity provisions set forth above, Except for such provisions, City and Hyatt shall not have any.:, legations to each other unless and until full execution of thy: New Lease. If a New Lease is not exeeut=4 by expiration of the Exclusivity -Period, unless otherwise agreed to by the Parties in writing, this Mt shall au.tonratically terminate, other than the above Confidentiality provision, which shall survive ter nation for one (1) year. In addition, this IwlOU shall terminate in its entirety upon the full execution oft New Lease, For the purposes o thc City Comm 2`"' readings a Referendum entities sh• laws, ru this discussion, this MOU and subsequent contract documents will require approval of ton. That process may include the itembeing placed on the Commission Agenda, PI and 1 then final approval. The final New I_.ettse shall also require approval by the voters at Each or the City and Hyatt, and their respective affiliates, representatives, and assoeiated use commercially reasonable efforts to comply, inall material respects, with all applicable s, regulation, disclosures, and statutes (whether beat, state, or Federal), to include the tviiami 21 zottina rdinance, in the performance of this or any agreement, instrument, or actian(s)' relative to the MOU or N Lease, Tho City shall cooperate with Hyatt, its affiliates, representatives and associated entities to fzr mate and expedite approvals and conformance with local, state, or federal ordinances as may be r• asonably required. 2 The Parties understand that this MOU and any subsequent contract documents will requ'ree the applicable internal approvals of Flyatt including the approval of Hyatt's Development Cottee, the Finance Committee of Flynn's Board of Directors, and Hyatt's Board of Directors. If you are in agreement with the Perms of this MOU, please indicate same b counter -signing where indicated below. We look forward to moving forward with you an this irnporta project. S iitcerely, CITY OF MIAMI, a municipal commotion of the State of Florida By: Daniel J. Alfonso City vlaniagcr Accepted and Agreed to: HYATT EQlJfT1ES, l,.F. C. By: Name: Title: 3 ATTACHMENT A TERM SHEET EET This terns sheet (`Term Simi"). dated this day of' , 2016, is a proposonly, and is not contractually or le.gally binding. It represents only an expression of the parties' present •es ire and intention to enter into negotiations of n possible agreement to icase the Property (as defined bet + ) by Hyatt (defined below) from City (defined betow). City and Hyatt are sometimes colketively r 'erred ro herein as the "Parties" or individually as a 'party'. The matting attic general terms and condi 'sns are as follows! 1. GENERAL: 1.1, PARTIES TO NEW LEASE: Hyatt Equities, L.L.C„ or an affiliate thereof as ground lessee and developer, If applicable (°Hvatrfj; Hyatt may enter into ubsequent agreements, with City of 4J iaitri ("City") approval as may be requir tinder the New Lease or by applicable law, including, without limitation, int venture agreements, development agreements or subleases with prospect'e partners, developers ar other tli ird parties in connection with the performance lts duties under the New Lease, and 1.1.2. City of NIkiln i, as ground lessor Jt'"j. 1 .2. •fl-IE PROPERTY: City and Hyatt will .iter into tut amended and restated lease (the "New Lease") of Me existing Ground Lease ► irsuant to which Lessee currently leases front Lessor the real property (the `Hotel Land") pon which the Hyatt Regency Miami (the "Hotel") is located (tlie "Existing Ground Leas, '). Pursuant to the New Lease, (i) the City will continua to lease to Hyatt, and Hyatt will c. ittune to lease from the City, all of the City's right, title and interest in the Hotel Land, inc lu sag any City interest in the Hotel and any other improvements, furniture, tixtures, and pers sal property located on the Hotel l..and and any additional development, air or other ;r' I.its appurtenant to the Hotel Land not currently provided in the existing land lease, as agry ti by the City pursuant to the approved Master .Phan, and (ii) the Cif will agree to lease . Hyatt, and Hyatt will agree to lease from the City, the real property upon which The Junl, L. Knight Miami Convention Center (the "Convention Center") is loctited (the "Cot ve* ion C'ente Land"), includiing, without limitation, the Convention Center and all other irnpr.vein nts located on the Convention Center Land, any City interest in the furniture, fixtur.', improvements and personal property Located on the Convention Center Land and any additi ta'l development, air or other rights appurtenant to the Convention Center Land as agreed by is City pursuant to the approved Master Plan ((i) and (ii) are collectively referred to herein i the "Property"). 1.3. DUE ► ,L1G1JNCE: Hyatt shall complete all due diligence work it deems necessary or rtdvi • le on the Property prior to its execution of the New Lease, at its sole cost and expense, inc iding without limitation, title survey, soils, environmental and all feasibility studies and ts. City and Hyatt shall execute a separate commercially reasonable access agreement hitting Hyatt and its agents and con.snitants access to the Property in order to conduct the requisite tests and Studies, subject to Customary release, indemnification, insurance, notice and repair requirements, Upon its completion and receipt thereof, and upon request from the City, Hyatt shall deliver to City copies of all third -party environmental, property condition and soil reports, surveys and title reports resulting front its due diligence activities related to the Property. 1 Subject to such access agreemcnt, City will grant Hyatt immediate and reasonable ace to the Property, the Parking Garage, the Property records, and the Convention Center rtrt, ngenient team and other employees for the purpose of inspecting the physical condition of e Properly (including for the purpose of soil and other environmental tests and meshonal and other inspections) and evaluating the Convention Center business, in Ilyatt's sole is -cation. The City shall deliver copies to or provide access to Hyatt of all Property tee ds within City's possession, or the possessionof its Convention Center Ina natter, affiliates onsultants, agents, representatives or employees, including, without limitation, cnvironms tat reports, property reports, title commitments and policies, surveys, building plans, corresndeuce with or notices from any governmental agencies, information pertaining to any law it(s) pending against the Convention Center, .the Hotel or the Property, and any other in for ation reasonably requested by Hyatt, 2. R.EDI VELOPMENT: 2,1 Within twelve (12)1 months of execution of this Term Sh r, Hyatt shall prepare, and deliver to the City for its review, a master plan (the "Mestet• flair for the redevelopment of the Property (the ") jeet"). The lviastcr Plan shall include, amo other components. parcel development plans (for a Hyatt hotel, meeting space and other typi 1 hotel amenities, and expanded tnixed use development that may occur on the sits;), financin„' cquityplans for the Project; strate,l;y for the use of public funds, public funding mechanism or public assets including use plans. (lesired densities. design criteria for base buildings a public spaces, a proposed streetscape, a retail merchandising plan to the extent retail is an lentent of the development, an infrastructure plan and a parking plan. The Master Plan shot d include proposed development that maximizes the site's deiasity and proposed Project plash fagreed upon, the hieastcr Plan approved by the City and Hyatt shall be attached to the New .ease and Hyatt shall develop the Property in accordance with the Master Plan agreed to and a roved by the City. 2.2. 1fHyatt and the City, in their di cretion, determine to proceed with the Project based upon an ag,reed upon Master Plan and t ins to the New Lease, Hyatt's obligations under the New Lease 4 shaft include, among other r quirements: (i) to redevelop the Property as contemplated by the Master Plan; (ii) to obtain . oiling F.ntitlements (detsncd below) as necessary, for the Property to permit development of sa tet (iii) tv secure the requisite equ ity investment and financing necessary for the Project within e parameters set truth in the New Lease; (iv) to adequately address all infrastructure require ents necessary for the timely development of the Property, (v) to develop a plan to adequately , icfress parking reguiremenLL for the Project (vi) to construct the improvements in accordance w`'t tlic Master Plan and plans otherwise approved by the City pursuant to the normal plannirt and permitting process, and (vii) to operate: and maintain the buildings, ,rounds, and infrastru' tire in the manner prescribed by the New tease throughout the term of the New Lease. 2.3. lithe 1ties elect to proceed with the Project, Hyatt shall take the lead, at its expense, in Obtaining all - titletnents far the Property to accommodate the approved blaster Phut ("Zoning En Y k jjienjs"). The City shall use its best efforts to .a,Ssist and reasonably cooperate with Hyatt roughout the Zoning and F.ntitlement,proceas. In the event that the Parries elect, Or either Party elects, to not proceed with the Project, the Parties shall have no ohl.i.gtat_ons hereunder other than the confidentiality provisions. 3. NEW LEASE; 3.1. EFFECTIVE DATE OF LEASE; TEAK The New Lease shall he effective (the °`I•JJ'ectiue Dane") upon execration by the Pa Party having obtained all necessary approvals as set forth in the MOLT and this the Parties having agreed upon the Master Plan, which will be attached to the initial term for the New Lease shall be from the date of ground lease execute, Date") through December 31 of the year that contains the 99' anniversary. Date. 3.2. MOUND RENT: Ilya Hotel and_Arli'oining, anaey 1, Knight. 'onvention Ce er On or before January I" of each lease year, Hyatt she Rent") for the Property as follows.: During the co structiou period: les, and each rm Sheet and ew Lease. The ("Commencement the Camreneentent pay to the City base rent (*.Base Base Rent (to be paid bj Hyatt, or the devel er of the Project, during the construction period) for the Property shall he the followi Year one ( I ) during, the construction per lit Year two (?) during the construe tion riod Year three (3) during the construe period $0 $500,000 $.5 00,000 Thereafter and aongr ing, Hyatt s 11 av to the City not less than; Two million do ears ($2,000,000) per year (as may he escalated from year to year). or, The math +mica] average of two appraisals commissioned by the City for the land tare r which the hotelis constructed plus space occupied by the James L, Knigh convention center. The formula for the establislunent of base rent for the liote property and James L. Knight center shall be five percent (5%) multiplied by ie mathematical -average of appraised value. Should 5% or the mathematical .erage of two appraisal exceed two million $(2,000,000) per year (as may be escalated from year to year), Hyatt shall .bo required to pay up to, but not more than ii Seven percent (7%) of gross room and meeting receipts of'the Property plus 5% of gross beverage receipts, plus 3% of fntd receipts, plus a to be determined percentage of other gross income receipts, as agreed upon the parties once such other income sources at the Property are determined. For the tivtoidance of doubt, Hyatt shall not pay any other rent or fees to the City for space utilized in the operation of the Hotel and meeting space on the Properly. 3 b. Proms Participation for Fptndcd Development ent on -tile Pro m In addition to Base Rent for the Hotel and meeting space, tiller the. caustructior owner of the non -Hotel componeriLL of the Project shall pay to the City a plat" rent ("Participation, Rent") with respect to the other income produl i Property, other than the Hotel and Hotel Land and meeting space, deter of: I) 2) A to be determined percentage of gross profit a development on the Property as defined in the agrees of the Property; and Rent formulaically determined by: i. A current appraisal of the property o L. Knight Convention Center as s An appraisal of the land area Convention Center land and IrL period, the participation areas of the ed as the greater chafed with expanded 1 for the redevelopment cupicd hy thehotel and James ing concern" shall be performed. he Hotel and James L. Knight all appurtenant air rights shall be perforated and determined fo "highest and best use The difference; between hit, lest and best use value of the INIotat and Jams L. Knight Cone on Canter land and value of going concern of the Hotel and Co =enrion Center shall be the City's financial contribution to the e. minded development. See Below BUIrlple for c'7tl(]Il;stratioLl Purposes Oldy: Highest & Best Use Inc of Hotel and- COI 'n.tion Center• Land X $100.0OO:000 Less: Value •ottotel and Convention enter as rotng Cot a rtt Y $60,00t),t)00 l yttals; C' v Contribution Z $40,OOO,OOO City's aniribution shall he treated as a limited partner equity investment. Notw • tstanding the 6regoing, the City shah not be a joint venturer ar par er with Hyatt: arty references to partner equity investrnent and similar t tns are solely for purposKa of caleulatiug Participation Rent. Therefore, if le total illy<e.stment for the ex.piandled development is A $200,000,O00 then City's profit participation rasing the example above shall be 20% of ($40,000,.000) divided by A ($20O;000,OOO) . The numerator is equal to Z (lO,OQO,QOO) and the denominator is A ($200,OOO,OOO) which produces.the City's equity contribution of 20%. 3.3. A.: AL ESCALATOR: the 5th anniversary of the commencement of the New Lease, anti on each 54' anniversary renfter during' the remaining Term or e4tensions thereof, the minimum Base Rent shall be the cumulative compounded increase in the Consumer Price Index for All urban Consumers (CPI-Ii) Miami; provided, however, that the increase in Base Rent shall in no event be less than two percent (2.O%a) per year. 4 3.4. NET LEASE: The New Lease shall he absolutely net to City, and Hyatt shall pay all real estate ta..Kes operating and other related expenses during the term thereof 3.5 SUUORDINATION The New Lease, any Leasehold interests created thereby and any security .inter sts granted therein (to lenders, equity providers and the like) shall he subordinate to City's fee merest in the subject Property at all 6010 throughout the New Lena term or extensions thci t F, provided, however, that the Parties shaft record a memennidutn of lease ai.geinsr the Propert , which shall be senior in priority to any encumbrance on City's fec simple. interest in the Hotel net and Convention Center Land and reversionary interest in the improvements on such lands. 3.6 PARKING; The New Lease will provide Hyatt with all the same parkin respect to the Hotel under the Existing Ground Lease. 'I'!t to reasonably apportion parking in the C.i4 Garage to pro Project. Notwithstanding the foregoing, as part of the portion of the parking requirements For the Project Plant for the Property (separate and apart front par 3.7 ASSIGNMENT AND DISPOSITION fticwr With City-'s prior written approval. Hyatt worth ot'(s� ] and either engages a manager who is a First CI company or produce type that enjo., Corporation and the Hyatt Regenc rights currently held by Hyatt with arties will cooperate with each other •isle necessary additional. parking for the •o ect,1-fyatt may propose that all or some ittet by proposed parking within the Master g With iia the Parking Garage). aty assign the New Leiise to an assignee that has a net hold%, a franchise with a First Class Hotel Company or s Hotel Company. A "First Class Hotel Company"- is a a reputation in the Hotel industry similar to that of Hyatt product. Hyatt';s ability to mortgage, pi ge or conditionally assign the New Lease to leaisehold mortgages shall be, us provided in the N Lease. 3.S MORTGAGEE PROTE ONS: The New lease shall i Hyatt% lender, inch[ (Wanks or terin-ir (iii) upon term terms and co ext.rrtt suss chide customary and commercially reasonable provisions for the benefit of iota, without limitation, the right of lender (i) to receive notices. of any Hyatt ion by City, (ii) to cure any Hyatt cleiauIts within a reasonable grace period, and ion of theNew .Lease, to enter into a new lease directly with City on the same itians as the New Lease upon lender's .cure of all of MLatt's prior defaults, to the tib le of being cured. 3.9 OTHE ERMS AND CONDITIONS: arnt of New Lease shall include other terms and conditions that are normal and customary f similar projects and as agreed to by Hyatt and City. 5 4. PUBLIC l: UNDIN.G: City sha II reasonably cooperate with and assist Hyatt in obtaining available governnteut incentives (such as. by way of example. sales tax relief on construction rli iterials, TIF-type inc Lives, etc.) in connection with the New Lease and the investment by Flyatt in the redevelopment of to Property. 5. COMMUNITY OUTREACH AND STAKEHOLDER MEETINGS; The Ground Lease shall set forth the parameters and the Parties' respective rol,, and obligations related to all Community outreach and static -holder meetings to be conducted to co Ilection with the Zoning Entitlements or otherwise related to the design and development of the Pr.;cct. 6. REAL ESTATE BROKERS: CL3RE was hired by the City through Stale of Florida Contract D 5- 12/13-007A. Hyatt intends to engage CBRE in connection with the Project. ()titer than Ci3R lne. whose duties and loyalties are solely to the Cite, no other real estate broker or consultant to w ©al a commission or fee shall be doe has been engaged by either party, Upon execution of the ew Lease by the Parties, City shall be responsible to pity to CBRE, Inc. as part or its develi,pnerr. osrs a commission for theN4lew Lease as is set forth in a separate agreement between CI3RE, Inc:. , nd the City. City and Hyatt acknowledge CBR6's represeutr:tt ion of the City arld agree that the Ne , Lcase car other agreement between the Parties to acquire the Property wilt Inc lade saideoinnrissiona_, cement by reference. Hyatt shaIIIberesponsible for costs associated with I•lyau's direct enj agemerl FCBRE for all new development (including the construction or reconstruction of a hotel and any additional development on the Property pursuant to this Term Sheet pursuant to a separate agreeme between Flyatt and CBRE, 7. EXISTINQ LEASE TERMINATION: The Existing Ground Lease raid related a 'cements will be terminated effective 35 of the Effective pate of the -New Lease, with each Party relc _ in any claims (whether kniiwn or unknown) against. the other Party. B. CONVENTION CENTER MAN GER: The maned Bement agreement r the Convention Center with the current manager will be terminated as of the Effective Date of tl New Lease. with Lessor paying any outstanding fees and any required termination fees. 9. PRORA'f lONS: Real estate taxes special asseessrnents, utilities, rents and other amounts will be prorated as of the Effective late'. a usual and customary manner for a transaction of this type. 10. TITLE: As of t Effective Date of the. New.I..case, the. Property will be leased fi :c-of,any liens and mortgages and a v leases, tenancies or occupancies, _or any other encumbrances, or any defect in title to the Property that are not accepted by Hyatt in accordance with the terms of the New Lease and will be sr ijeet to. receipt ot'a satisfactory title insurance policy. 6 I 1. REM ESENTATfONS AND W.ARR.ANT1ES: Each Party will make customary representations and warranties to the other party for transaction of this type, as of the date of the execution of the New Lease. l2. COVENANTS, Each Party will agree to customary covenants for a transaction of this typ 13. PROPERTY CONVEYED “AS 1S": Except as specifically sot forth in the New Lease, the Propa1y will b conveyed in "as is." condition. 14. TRANSACTJON COST& 'file City shall he responsible for the payment of all transte taxes and recordation fees and the title insurance premium. All other transaction costs will be paid ' accordance with local: custom for similar large commercial hotel transactions. Each party will pay `sir own attorneys' fees. 15, DELIVERIES: At or before the Effective Date of the New Lease. ity will agree to property execute und/or deliver (i) ttie New Lease, (ii)an assignment and ussumpt' n of intangibles, (iii) a bill of sale., (iv) an assignment and assumption of'all operating agreements, nipnteat leases, services contracts and other leases and subleases rein tectto the -Property (to the extei accepted by Hyatt in the New Lease) (the" t trx:3tts"), (v). estoppels For the benefit of Hyatt a reasonably regnestedt by Hyatt, (vi) all other customary documents reasonably necessary from f.ity to complete the New Lease. Hyatt will properly execute and/or deliver (I) an assignment and at :trmption of all Agreements, (ii) nn assignment and assumption of intangibles, (iil) a hill of sate, and v) all other customary documents and funds reasonably necessary Fran Hyatt to complete the New are. 16. MISCELLANEOUS: I6.1. DEVELOPMENT Hyatt provide any other in RO FORMAS: e City with development pro fortnas For renovated existing or new hotel and d rase development to occur on the site. 16,2. COMM ICATIONS: The N w Lease shall establish a communications protocol (e.g., reports, meetings, designated repro entatives) to maintain open and continuous lines of communication between the Parties wi l respect to all design, entitlement, development anri programming activities related to the operty. 16,3. DISPUTES: All disputes cruder. the New Lease shad be resorted pursuantt to procedures be set forth in the New Lease, 7 164 DEFAULTS AND REMEDIES: The New Lease will sot forth provisions governing defaults by the Part' ' thereturder and will set forth the remedies available to the non -defaulting Party in the ever of a default. 16.5. NO ASS1CN TENT: 'Except as set forth in Section 3.7 above, neither Party shall be p rut itled to assign, transfer or otherwise convey its interests, rights or obligations under tE , New .Lease without written approval of the other Party. This Term Sheet dogs not c:onatitute un offer to lease the Property and any or the terms contained herein binding on either ol'th:e Parties. F obligate either Party to proceed with n transaction in any way wha when the Parties execute a New Lease. Without limitation. of the rteknowleedge that no Party shall have any obligation ofany kind such Party aetually c..cuJtes and delivers the New Lease an any time to withdraw from further negotiation or considerat any reason or for no reason in Hyatt's cr the City's soli; an or nature to the other Party hereto. 8 ' , not subject to acceptance, nor are rthermore, this Term Sheet does I104 ocvr. r. There shall be agreement only egging (A) Hyatt and City specifically nature to the. other Part, unless and until (13) Hyatt and the City reserves the right at to of the transaction contemplated hereby for absolute discretion without liability of any kind