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HomeMy WebLinkAboutPre-LegislationCity of Miami Legislation Resolution R-17-0261 City Hall 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.C. ("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 ($778,722.00) for the City's portion of the disputes regarding the Maintenance Costs and Concession Fees; and City of Miami Page 1 of 2 File ID: 2029 (Revision: B) Printed On: 4/10/2018 File ID: 2029 Enactment Number: R-17-0261 WHEREAS, pursuant to the Agreement, the City shall also pay to Hyatt a total amount equal to Eight Hundred Fifty -Four Thousand Three Hundred Dollars ($€354,300.00) 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: ndez, ity ttor ey 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: 6) 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°a 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' 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, drunpster fees and cleaning fees (the "Other Fees") as described in the letter dated November 12, 2012 from Hyatt 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 I 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 suffiviency of which is hereby acknowledged, the Parties agree as follows: 1. Recitals. The Recitals set forth above are 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 (GO) 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. E. 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 IIyatt 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 he 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 Simms 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 workmanlike 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 commencement 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 maajeure, 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 alI 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 licensed, 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 Hyatt'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 Term 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. 3. 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 1-Iyatt 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 claims: (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 Releasers 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 Releasers"), 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 Releasers 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, 10th 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 Miarni 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 12th Floor Chicago, IL 60606 Attention: Megan Schrnollinger With a copy to: Hyatt Corporation 71 South Wacker Drive I2th 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. 11, 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 Ibis 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 matter hereof and supersedes all prior agreements, understandings 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.C. 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AT 9Lfl,DING 'eV AU, fie ( -0 i =1. 1 1 ., Y V FLAN R❑RAIN DETAIL TYPICAL PRECAST PANE,J 1tiT DETAIL Ad TWAAT CURS re re ro A TYPICAL a RRAM P "NDkT .It I TERRACE 55EC'T,? r•, 'MTH C,7NE E WEARING SLAB .v,m vLL,wr..:ean.: :EFLRA:',i ns'EP�i(+Gr11.'G R£7•'FS .f'PTr KGL11.:' F5'.AN k3�1,1J.t3is1� DERAILS 99105 •-z \ PSAMC j ISOLATPLANTER eO;__a TYPICAL m4e NOT ED remai.ouvirmArwEsTswe 3ICYCLE TYPICAL PLANTERS WEST SIDE =Inv - IiPRACE RENal a= Exhibit E3 November 12, 2012 Letter [Attached} Karrie L. Dowd Seulor Counsel 71 South Wacker Drive Chicago, IL 60606 USA '1': 4.1 312,780.5467 November 12, 2012 Via E-mail (htorre Ca €niarniQov.com) Mr. Henry Torre Director City of Miami Public Facilities Division /Asset Management Division 444 SW 2" 1 Avenue, 3`d Floor Miami, F"1. 33130 Re: Hyatt Regency Miami (the "Hotel"); ease and Agreement for Development dated September 13, 1979 (the "Lease") between the City of Miami (the "City") and Hyatt Equities, L .L.C. ("Hyatt"), 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 Cal1") and to respond to your offer of a one-time waiver of overtime charges of $28,000 in exchange, 1 believe, for Hyatt's payment of $302,000 in concession fees billed by the City to Myatt, 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 are 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 rnade during the August 29 Call for a 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 [,ease 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 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 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 ag of the Theater/auditorium space and EeLgui,e,,fiarte to rim goceesionalre. 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 he the sole concessionaire and the sole consideration for that right is the Lease itself. The City's charge of concession 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 charges 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 riot 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 Beach and the Adrienne Arsht Center) do not charge any concession fees or clean-up fees to theft' concessionaires. Rather, any concession fee or clean-up fee is charged to the third party user/renter 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 Meeting Room Rates The City increase i the rates being charged 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 arc 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 Cosnrnission and there is no delegation of that authority to the director of the Convention Center. In fact, Veronica Xiques, Assistant City Attorney, in her letter to the dated tvlay 10, 2011, clearly advised that "[T]he 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 meting 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 same 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(I)(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) only 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 fees 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. Cleaning. Fees. The City charges Hyatt 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 he governed by the use agreement between the City and We 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 3 During the August 29 CalI, 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. .Eestroom Attendant. The City charges a restroom attendant fee when Hyatt rents certain facilities, There is no support for this fee in Sec, 53-1.81 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. Euthgatime} fig, The City recently advised Hyatt that it would increase the charge from $50 per day to $100 per day for any Hyatt function that uses a registration table that is outside of the teased room and on City space. Sec. 5$-.181(2) of the Code permits a $50 per day charge. We are not swam of any ordinance increasing the amount of the charge, During our August 29 Call, the City agreed to review and respond to Hyatt. Hyatt has not received a response. Over ,me 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 b.y Sec. 53-181(1)(d), During our August 29 Cali, 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-u» and Ereak•dowwn—Riverfront 131sl1. Section 8.4 of the lease requires the City to maintain and operate the Convention Center in good clean order and condition as a first-class 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 lv;raintenance Fees do Hatt The City currently owes Hyatt approximately $43,3 t8.00 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 are owed and has been disputing these fees. Moreover, the Lease does not provide fora right of offset. Then, during our August 29 Cali, 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 cc (via e-mail) Dave Phillips Luis Alma Veronica Xiques Daniel Newhoff Exhibit C Menioranddun of Understanding [Attached] [lard OfJJocurnent] Fitt of Tax i March 21, 2017 •Fiffany Leadbetter Donato Senior Vice President Capital Strategy, Real Estate Transactions Hyatt Hotels Corporation 71 South Wacker Drive Chicago. IL 604506 Re: lb[emoranduin of t lnderstanding: (I) Amended. and Restated Land Lease • lea:• Mrs. Donato: Hyatt Equities. L.L.C. ("Hyatt")and the City OfMiami (" Cil:y") (collectively, the "Parties") desire to amend and restate. their existing land lease relationship, and have Hyatt redevelop the Property (as anticipated and deferred iu the 'Term Sheet attached hereto), upon which the existing Hyatt Regency Hotel and lames L Knight convention center occupy. The following paragraphs set earth the basic: terms and conditions upon which said relationship shall he structured subject to the negotiation and execution of an amended and restated Land lease (the "New l e e"), and the other terms aid conditions contained In the 'Fertn Sheet. At the rninirnum, said agreement is anticipated to incorporate the following: 1). The Parties wilt enter into. an interim agreement with respect to the Existing Ground Lease (as defined in the Terns 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 cotmnenoes, including, without limitation, an agreement on the payment of certain shared expenses on a going- i`urward basis and an agreement of the Parties to stay etn•rent on such obligations during the interim period. 2) The Parties shall intend to modify the Existing Ground (..ease, including, without limitation, to: a. Extend the land tease term plus extensions to a total of 99 years; b. Expand the leased premises to include the tunes L Knight convention center/meeting space; c;. Amend and restate the parking agreement to accommodate a. and b. above; d, In canjunst.ion 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 frwm, 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 such payment plan and other agreements made between the Parties in resolution of such outstanding amounts owed between the Parties.f e. Myatt shad redevelop the Property subject to the following: 1. Hyatt shall explore the use of the additional development rights on the Property; ii. Hyatt shall engage directly CBR.E , 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 a.nd the City. iv. The. Parties will mutually agree upon a Master Plan (as defined in IheT'erm Sheet) for the redevelopment of the Property, When fully executed, this Memorandum of Unelcrstanding (together with the term sheet attached hereto as "At achnient " and incorporated herein (the "Term Sheet"). the 'MOW) shall reflect the expression of l{yatt's and the C.itty's desire to proceed with the negotiation and possible execution of a New Lease to inc lode the redevelopment of du.- Property. New Lease. Subject to certain conditions as set forth in the MOU being satisfied, the New Lease will be negotiatix1 to reflect the intended deal term set forth in the MOU. Exeluwivi y, From the slate hereof through March 31, 2017 (the Iixcjusiy't err 1"), City shall negotiate exclusively with Hyatt for the redevelopment of these parcels; provided, however, that in the event the Parties mutually agree in writing, or Hyatt notifies City in writing of its intention to cease the negotiations prior to such date, then the Exclusivity Period shall expire on the date of cessation of negotiations. Confidentiality. The terms of this MOU and the New Lease, as well as any non-public information related to the transactions shall be maintained as confidential by the Parties, except for (i) disclosures required by law (specifically including Florida Statute Chapter 119) or rule,: of applicable securities exchanges, (ii) disclosures to the Parties' respective board members, agents, employees, attorneys, accountants, brokers, contractors, lenders, prospective Tenders, investors, prospective investors, consultants, advisors or other representatives. and (iii) disclosures that the Parties mutually agree in advance arc required or desirable to advance Zoning Entillenaents (as defined in the Term Sheet) or other public approvals or concessions or information tint otherwise advances the planned development. l he foregoing notwithstanding, the Parties agree that any public announcement of an executed transaction (i.e., executed New Lease) shall his mutually agreed upon by the Parties prior to any public announcement, iwrota-?3indin.. This MOU shall not create any legally binding obligations on the Parties, other than with regard. to the Exclusivity and Confidentiality provisions set forth above, Except for such provisions, Clty and Hyatt shallnot have any obligations to each other hitless 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 Confidentiality provision, which shial.l survive termination for one (I) year, in 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 approval of the City Commission. That process may include the item being placed on the Commission Agenda, l'` and 2'"` 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 commercially reasonable efforts to comply, in all material respects, with all applicable laws, mules, regulation, disclosures, and statutes (whether total, stale, or federal), to include the Miami 21 zoning ordinanee, in the performance of this or any agreement, instrument, or actions) relative to the MOU or New Lease, The City shall 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 l iyt►tt's Board of Directors, and I-lyatt's Board of Directors. If you are in agreement with the terms of this MQU, please indicate same by counter -signing where indicated below. Vv'e look forward to moving forward with you on this important project, S incerety, CITY OF a municipal corporation of the State of Florida By. Daniel J. Alfonso City Manager Accepted and Agreed to: HYATT F QUITIES, l ,L,.C. By: Name: Title: 3 ATTACHMENT A TERM SHEET This term sheet ("Teruo Sheet"). dated this __-_---- day of , 2016, is a proposal only. and is not contractually or legally binding, It represents only an expression ante parties' present desire and intention to enter into neg,otitatiuns of a possible egrreement to lease the Property (as defined below) by Hyatt (defined below) Iron C ity (defined below). City and Hyatt are sometimes collectively referred to herein as the "Parties" or individually as a 'party". The outline of the general terms and conditions 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: ("Ilyattj: Hyatt may enter into subsequent agreements, with City of Mlami ("City") approval as may be required under the New Lease or by applicable taw, including, without limitation, joint venture agreements, development agreements or subleases with prospective partners; developers or other third parties in connection with the performance of its duties under the New (.case; and 1.1.2, City of Minini, as ground lessor ("City). 1 .1, THE PROPERTY: City and Myatt will enter into an amended and restated lease (the " N„ w Lease") of the existing Ground Lease pursuant to which Lessee currently leases from Lessor the real property (tile -Hotel Land") upon which the Hyatt Regency Miami (the "Hotel") is located Glee 'Existing Ground Lease"). Pursuant to the New Lease, (i) the City will continue to lease to Hyatt, and Hyatt will continue to lease from the City, all of the City's right, title and interest in the Hotel Land, including any City interest in the Hotel and any other improvements, furniture, fixtures, and personal property located on the Heotet Land and any additional development, air or other rights appurtenant to the Hotel Land not currently provided in the existing land Rase, as agreed by the City pursuant to the approved Master Plan, 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 `°Cgnyent on Center Land"), including, without limitation, the Convention Center and all other improvements located port 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 appurtenant to the Convention Center Land as agreed by the City pursuant to the approved Master Plan ((1) and (ii) are collectively referred to herein as the "Property"), 1.3. DUE DILIGENCE: 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, environntentnl and all feasibility studies and tests. City and Hyatt shall execute a separate commercially reasonable access agreement granting Hyatt and its agents and coetstrltants 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 itnniediate and reasonable access to the Property, the Parking Garage. the Property records, and the Convention Center tnanaaement. team and other employees for the 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 1-lyatt's sole discretion. The City shall deliver copies to or provide access to Hyatt of all Property records within City's possession, or the possession of its Convention Center manager, affiliates, consultants, agents, representatives or employees, including, without lituitation, environmental reports, property reports, title commitments and policies, surveys, building plans, correspondence with or notices from any governmental agencies, information pertaining to any lawsuit(~) pending against the Convention Center, the Hotel or the Property, and any other information reasonably requested by f-fyatt. 2. REDEVELOPMENT:. LOPMEN"I;. 2.1. Within [twelve (12)] months of execution of this Terns Sheet, Hyatt shall prepare, and deliver to the City for its review, a master plan (the "Minster Plain") for the redevelopment of Flit Property (the "Pt: E4ct"). The Master Plait shalt include, among other components: parcel development plans (fora Hyatt hotel, meeting space and outer typical hotel amenities, and expanded mixed rise development that may occur on the site), financing/ equity plans for the Project; strategy for the use of public funds, public funding mechanisms or public assets including use plans, desired densities, design criteria for base buildings and public spaces, a proposed streetscape, a retail tnrchandising plait to the extent retail is an element of the development, an infrastructure plan and a parking plan. The lvlaster Plait shouldinclude proposed det.elopment that maximizes the site's density and proposed Project phasing. if agreed upon, the Master Plan approved by the City and Hyatt shall bc; attached to the New Lease and Hyatt shall develop the Property in accordance with the Master 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 terns to the New Lease, Elyatt'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 name; (iii) to secure the requisite equity 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 tittnely development of the Property, (v) to develop a plan to adequately address parking requirements for the Project (ti'i) to construct the improvements in accordance. with the Master Plan and plans otherwise approved by the City i urstrnrit to the normal plaint hip, and permitting process; and (via) to operate and maintain the buildings, grounds, and infrastructure hr the manner prescribed by the Nclv Lease throughout the term of the New Lase. 2.3. ff the Parties erect to proceed with the Project, Hyatt shalt take the lead, at its expense, in obtaining all entitlements for the Property to accommodate the approved Master Plan ("Zottirig f ntiternenfs"), The City shot) useits best efforts to assist: and reasonably cooperate; with Ftyatt throughout the Zoning and Entitlement process. 2:4. En the event that the Parties elect, or either Party elects, to not proceed with the Project, the Parties shall have im obligations hereunder other than the confidentiality provisions. 2 3, NEW LEASE: 3.1. EFFECTIVE DATE OF LEASE. TERM: The New Lease shall be effective (the "EtTective Date) upon execution by the Parties, and each Party having obtained all necessary approvals as set forth in the MOD and this Term Sheet and the Parties having agreed upon the Minster Plan, which will be attached to the New Lease. The hi itial term for the New Lease shall be fro.rn the datte of ground lease execution ("Comnaoncetnent Date') through December 31 of the year that contains the 99'h anniversary of the Comntencentent Date. 3,2. GROUND RENT: at, Hiatt Hotel, and Adjoining James L. Knight ttvetttican Center On CA' before January IS` of each lease year, Hyatt shall pay to the City base rent ("Base Rcnt") for the Property a follows! During the construction period: Base Rent (w he paid b>.• Myatt, or the developer of they Project, during the construction period) for the Property shall be the following:: Year ane (1) during the construction period $0 Year two (2) dining the construction period $500,000 Year three (3) during the construction period $500,000 ["hereafter and on}?csinsir Myatt shall pav trt the. City not lass than: i. Two million dollars (Z'2,000,0QD) per yeas, (as may he 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 James 1... Knight convention center. "{'he formula For the establishment of base rent For the hotel property and Jatne•:s L. Knight center shall be live percent (5%) multiplied by the mathematical average of appraised value. Should 5% o1`the mathematical average of two appraisal exceed two million S(2,000,O00) per year (as may be esca fated from year to year), Hyatt shall be required to pay u.p to, but not more than 'di. Seven percent (I%) ©f gross room and meeting receipts of the Property plus ,5% of gross beverage receipts, plus a% of food 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. Fur the avoidance 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 Property. 3 b.- Profits Pgttit.jpotian for ENpande<I Development on the Property En addition to Base Rent for the Hotel and meeting space, after the construction period, the owner orthe iron -Hotel components or the Project Shalt 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 meeting space, determined as the greater of: 1) A to be determined percentage of gross profit associuted with expanded development on the Property as defined in the agreement for the redevelopment of the Property; and 2) Rent formulaically determined by: A current appraisal of the property occupied by the Elatel and James L. Knight Convent ion Center as a "going concern" shall be per fort r ied. ii An appraisal of the land area of the I-k,tel and James L. Knight Convention Center hind and all appurtenant air rights shall he performed. and determinedfor "highest and best use" iii, The difference between highest and best use value of the Hotel and James L, Knight Convention Center land and value of going concern or the Hotel and Convention Center shall be the City's financial contribution to thc expanded development. See Below E..,sa.rr le for Demonstration Purposes Only: Highest 8 Best Use Value of Hotel and Convention _ X Si 00,000,000 Center Land Less: Value of Hotel and Y. $6..0,000,000 Convention Center tts Going Concern Et ttals: Cit • Contribution Z $40,000,000 City's Contribution shall be treated as a limited partner equity investment. Notwithstanding the foregoing, the City shall not be a joint venturer or partner with Hyatt,: any references to partner equity investment and similar ternis are sotely for purposes of calculating Participation Root, Therefore, if the total investment for the t4anded development is A $200,000,000 then City`s profit participation using the example above shall be 20% of Z (S40.,000,000) divided by A (S200,000,000) , The numerator is equal to Z ($40,000,000)-and the denominator is A ($200,000,000) which produces the City's equity contribution of 20%. 3.3. ANNUAL ESCALATOR: On the 5'1' anniversary of the commencement of the New Lease, and on each 511' anniversary thereafter during the remaining Term or extensions thereof, the minimum Base Rent shalt be the cumulative compounded increase in the Consumer Price Index for All Urban Consumers (CPI-U) lvtianri; provided, however, that the increase in Base Rent shall in no event be less than two percent (2.0%) per year. 4 3.4, NET LEASE: The New Lease shall be absolutely net to City, and Hyatt shall pay all real estate: taxes, operating mid other related expenses during the seem thereof, 3.5 SUBORDINATION: The New Lease, any leasehold interests created thereby and any security interests granted therein (to lenders, equity providers and the like) shall be subordinate to. City's fee interest in the subject Property at all times throughout the New lease terns or extensions thereof; provided, however, that the Parties shall record a memorandum of lease against the Property, which shall he senior in priority to any encumbrance on City's fee simple interest in the Hotel Land and Convention Center Land and reversionary interest in the improvements ents on such lands. 3,6 PARKING: The New Lease will provide. Hyatt with all the some I -Narking rights currently held by Hyatt with respect to the Hotel under the Existing Ground Lease. '[ke Parties will cooperate. with each other to reasonably apportion parking in the G4 Garage to provide necessary essary additiuunl parking for the Project. Notwithstanding the foregoing. as part of the Project, Hyatt nary propose that all or some portion of the parking requirements For the Project he met by proposed parking within the Master Plan for the Property (separate and apart from parking within the Parking Garage). 3.7 ASSIGNMIENT AND DISPOSITION RIGHTS: With C ity't, prior written approval. Hyatt may assign the New Lease to an assignee that has a net worth Off$ 1 and zither holds rt franchise with a First Class Hotel Company or emerges a manager who is a filrst Class Howl Company, A "First Class Hotel Company" is a company or product ty-pe:that enjoys a reputation. in the hotel industry similar to that or Hyatt Corporation and the Hyatt..Re ency product. i [yatt's ability to tnorlgagc, ptedPe or conditionally assign the New Lease to leasehold mortgages shall be as provided in the Now Lease. 3. t MORTGAGEE PROTECTIONS: The New Lease shall include customary and commercially reasonable provisions for the benefit or Hyatt's lender, including, without limitation, the right of lender (I) to receive notices of any Hyatt defaults or termination by City, (ii) to cure any Hyattdefaultswithin a reasonable grace period, and (iii) upon Wraination of the New Lease, to _enter into a new lease directly with City on the same terms and conditions as the New Lease upon lender's cure of all of f lyatt's prior defaults, to the extent susceptible of being cured, 3.9 OTHER TERMS AND CONDITIONS: The form or New Lease shall include other terms and conditions that are normal and customary for similar projects and as agreed. to by Hyatt and City. 5 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 Lertse and the investment by Hyatt in the redevelopment of the Property. S. COMMUNITY OUTREACH AND STAKEHOLDER MEETINGS: 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 correction with the Zoning Entitlements or otherwise related to the design and development of the Project. 6. REAL ESTATE BROKERS, CBRE was hired by the City through State of Florida Contract DMS-12/13-cX37A. Hyatt intends to engage CBRE in connection with the Project, Other than CBRE, Inc,. whose dirties and loyalties are solely to the City, no other real estate broker or cellistt{tant to whom a eominission or fee shall he due has been 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 sat forth in a separate: agreement between CBR.E, Inc, imd the City. City and Hyatt acknowledge C; E .RE's representation of the City and agree that the New Leaasc or other agreement hettveen the Parties toacquire the Property will include said emir' ission agreement by reference, Hyatt shall be responibie for costs associated with I-lyrrtt's direct engagement of CER.f:: for all new development (including the construction or reconstruction of n hotel and any additional development on the Property pursuant to this Terni Sheet pursuant to a separate agreement between Hyatt and CBRE. 7. EXISTINU LEASE TERMINATION: 'the Existing Ground Lease and related agreements will be terminated effective as oldie Effective Date of the New Lease, with each Party releasing any claims (whether known or unknown) against the oth,x Party. a. CONVENTION CENTER MANA(JI R: The management agreement for the Convention Center with the current manager will he terminated as of the Effective Date of the New Lease.. with Lessor paying any outstanding fees and any required termination fees. 9. PRORATIONS: Real estate taxes, special assessments, utilities, rents and other amounts will be prorated as of the Effective Date in a usual and cuatotnary manner for a transaction o.fthis type. I O. TITLE: As c>fthe Effective Date of the New. Lease, the Property will be leased free: of any hen 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 Hyatt in accordance with the terms of the New Lease. and will he subject to receipt off satisfactory title insurance policy. 6 1 1. REPRESENTATIONS AND WARRANTIES: Each Party will make customary representations and warranties to the other Parry fora transaction of this type:, .as of the 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 1S":. Except as specifically set forth in the New Lease, the Property will be conveyed in "as is" condition. €4-. TRANSACTION COSTS: The City shall be responsible for the payment of all transfer taxes and recordation fees and the title instrntnee premium. All other transaction costs will be paid in accordance with local custom for similar large commercial hotel transactions. lunch party will pay their own attorneys' fees. IS. DELIVERIES: (LIES: At or before the Effective Date of the New Lease, City will agree to properly execute and/or deliver (i) the New Lease,. (ii) an assignment and assumption of intangibles, Oil) a bill of sale, (iv)_anassignment and assumption of all operating agreetttenta, equipment leaves, services coutraet;t and other leases and subleases r•eluted to the Property (to the extent accepted by Hyatt in the New Lease) (the re lts"), (v) estoppels for the benefit of Hyatt as reasonably requested by Hyatt, (vi) all other customary documents reasonably necessary from City to complete the New Lease. Hyatt will properly execute and/or deliver (i) as assigninent and assumption ©Fall Agcreeanents, (ii) an assignment and assumption of intangibles, (iii) a bill of sale, ttnd (iv) all other customary documents and fiords reasonably necessary from Hyatt to complete the New Lease. 16. MISCELLANEOUS: 16.1. DEVELOPM.EN. T' PRO FORMA;S: Hyatt provide the City with development pre forams -For renovated existing or new howl 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 tinder the New Lease shall be resolved pursuant to procedures to be set birth in the New Lease. 7 16.4. DE -FA uuTS AN[) REMEDIES: The New Lease will scat forth provisions governing defaults by the Parties thereunder and will set forth the remedies available to the non -defaulting Party in the event of a default. 16.S. 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 Les without written approval of the other Party. This Tenn Sheet does not constitute an offer to kale tht Property and is not subject to acceptance, nor are any of the terms contained herein binding on either of the Parties. Furthermore, this Term Sheet does not obligate either Party to proceed with tt transaction in any way whatsoever. There shall- be agreement only when the Parties execute a New Lease. Without limitation of the foregoing (A) Hyatt. and City specifically ackno.w ledge that no Party shall 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 (13) Hyatt and the City reserves the right at any time to withdraw from i`irrther negotiation or consideration of the transaction contemplated hereby for any reason or for no reason in lyntt`s or the City's sole and absolute diseretion without liability ofany kind or nature to the other Party hereof. B SUBSTITUTED. RECONCILIATION AGREEMENT This agreement to reconcile certain disputed issues and provide mutual releases ("AgF'cment"), is entered. into this day of , 2017, between the City of Miami, a Flo . da municipal corporation, ("City") and Hyatt Equities, L.L.C., a limited liability company doing bu, Hess 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"d 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 Miami and located at 300 SE 2"(1 Avenue, Miami, Fl. ida 33131 ("Hotel"); and WHEREAS, the Parties agree that an upgrade to the curr t fire alarm system located on the Convention Center property, which supports the Hotel 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 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 C 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 1- otel and its personal property located on the ground level of the J-lotel, resulting from the defective ti1-. , are in need of repair andfor replacement (the "Tile Project") for the proper operation and maintetian of the Hotel and the Convention Center; and WHEREAS, the Parties agree that c HVAC on the third floor of the Convention Center (the "HVAC Project") is in need of repair for the proper operation and maintenance of the Hotel and the Convention Center; WHEREAS, the Parties agr there is an on -going and present dispute regarding the amount of certain concession fees (the "Con • sion Fees") and other fees related to increased room rental rates, testroom attendant, overtime rate dumpste'. 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 B and made a part hereof (the "November 12, 2012 Let t= ") charged bythe City to Hyatt forme of facilities at Ilse Convention Center; and WHEREAS, d Parties agree that there is an on -going and present dispute regarding the amounts owed by each Party t naintain the Physical Plant ("Maintenance Costs") from :January, 2012 through the present date; and WHE AS, the Parties agree that there is an on -going and present dispute regarding the amounts owed for the .oling tower and chiller replacement project undertaken by Hyatt ("Chiller Overpayment") and outstare+ ng credits to Hyatt relating to depreciation payments made by Hyatt pursuant to the Lease Documen ~ ("Depreciation Credit"); and WHEREAS, the Parties agree that there is an on -going 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 all such disputes, claims and controversies among them as provided herein; and NOW Tl•IEREFORE, in consideration of the mutual promises and cov nants receipt and sufficiency of which is hereby acknowledged, the Parties agree as allows: 1. Recitals. The Recitals set forth above are incorporated herein. 2. Agreement Terms. ierewi th, tong other nderstanding development") c 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 -Nine 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 Agreement no la r than sixty (60) days from the date hereof. The City shall have no liability or obligation t• pay any sum or cost whatsoever in excess of the City's Contribution with respect to the Pr'..aects 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 Documents, del, s caused by the City or related parties to the City or force majcure. Hyatt shall have no !i° 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 monies_ required by Hyatt to complete the Projects be 'i) in excess ot-the City's Contribution, Myatt shall, at its sole cost and/or expense, comp! e the Projects using Hyatt's independently acquired funds or (ii) below the City's Coniri lion, all such excess of the City's Contribution shall belong to Hyatt. If the City fails t tyke the City Contribution payment in accordance with this subsection A, Hyatt may el duct such amount from the next rent payment under the Lease Documents, and each ren payment thereafter, until the full balance of such amount owed by the City to Hyatt has be.. paid in full. B. Maintenance and t►oncessiou Fees. The City shall also pay Myatt a total amount equal to Seven Hundred S , enty-Eight Thousand Seven Hundred Twenty -Two Dollars ($778,722.00) to resolve the dis , tes regarding the Maintenance Costs and Concession Pees. If the City fails to make such p, yrnent by the time Hyatt's next rent payment nuclei. 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 Outstanding City Fees. The City shall also pay Hyatt a total amount equal to Eight Hundred Forty -Five Thousand Six Hundred Sixty -Seven Dollars ($845,667.00), to resolve the ditales 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, 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 resp et to the Redevelopment are .not entered into by the City and Myatt (following appr al by City Commission and referendum) on or before December 31, 2018 or discussio between the City and Hyatt regarding the Redevelopment plans otherwise discontinue fo any reason, the Outstanding City Amounts stall become immediately due and payable b the City to Hyatt upon written notice from Hyatt to the City. If the City fails to make su'_ n Outstanding City Amounts payment to Hyatt within sixty (60) days of receipt of such wri cn notice, Hyatt may deduct such amount from the next rent payment under the Lease l) umcnts, and each rent payment thereafter, until the full balance of such amount owed by e City to Hyatt has been paid in frill. D. Projects. Hyatt-'s shall complete the Fine Alarm Project, the Ti1roject and the HVAC Project (collectively the "Projects") pursuant to a scope of wor and plans and specifications ("Specifications"), and killer corresponding to the Flo. 'lrg Repair Area, determined by Myatt for the Projects. Additionally, if bonds are require•. for the Projects per section 255.05, Florida Statutes, as this is City -owned property, Hyatt s all obtain such bonds for the Projects. The Specifications, the selected contractors and thcontracts with the respective design, consulting, construction contractors shall not be sub, - ct to the City's approval (subject to such contracts complying with the requirements of sub ction F below). Hyatt shall provide copies of the Specifications and the final, executed cot raets with all consultants and contractors for the Projects. The. parties acknowledge and agr- that Siemens Industries, Inc. as the contractor, and Rolf Jensen & Associates, Inc., for the esign and related work, have been preliminarily. selected for the Fire Ala rn Project and the omplete Property Service, Inc., as the contractor, and Building Consultants, Ltd., for th design and related work, have been preliminarily selected as the contractor for the Tile P .ject. Hyatt shall use commercially reasonable efforts to cause the Projects to be performer in a good and workmanlike manner in accordance with the Specifications and in compile' • - with all applicable governmental laws, rules, regulations and industry standards. E. Schedule. Hyatt shall use mmmerci.ally reasonable efforts to cause the Projects to be performed and completed i ' accordance with a schedule (the "Schedule") that will minimize disruption of the Hotel a c Convention Center operations, provided that commencement of the Projects shall begin ithin months of the execution and approval ofthis Agreement (subject to Section 1 below) (the "Commencement Date") and be substantially completed within month- of the Commencement Date, subject to extensions due to force majeure, City caused delay:, and other events outside of I-iyatt's reasonable control. Time is of the essence. In no ent shall either Party be liable to the other for consequential, punitive or special damag. associated with any delays in the Projects. F. Project C+ntract Requirements ('Including Insurance and indemnification). Any construe n 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 appro al, which shall not be unreasonably withheld, delayed or conditioned (ii) that the City sha be named as an additional insured on oll 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 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 Ilyatt's obligations under such contract. G. Concession Tees; Maintenance Fees. From and after January 1, 2017, through t eremainder of the Term under the Lease Documents, Hyatt shall promptly pay the Cone sion fees in connection with its rental of meeting space in the Convention Center and as p perly invoiced by the City in accordance with the rates set forth in Chapter 53, Section .1 of the City of Miami Code of Ordinances (which currently provides for $100 fo a single portable food/beverage concession and $200 for a single permanent food/beverat; concession). From and after January 1, 2017, through the remainder of the Term under t Lease Document, the City agrees that it shall promptly pay its portion of the Maintenanc'ees in connection with the maintenance of the Physical Plant in accordance with the Lease ocunients and as properly invoiced by Hyatt. H. Reasonable Cooperation. Hyatt and (he City shall reasona cooperate with each other in connection with the Projects slated herein, including, , the ity providing reasonable access to the Convention Center during the period of constructio 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 iely approvals of all permits required for the Projects and the City providing reasonable a d timely inspections of the Projects, in accordance with the Schedule. Hyatt shall obtain e City's prior approval of shut downs of power, water, and HVAC, use of Loading docks, ockage of circulation areas, and within the Convention Center. If the City does not respon to 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 eomplianee with authorizations, procedures and requirements prescribed by the City C artcr, 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.re:.'c 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 nt that either of the Parties fails to fulfill its obligations (and such failure is not due to force inaje e, the action or inaction of the other Party, and other events outside of such Party's reasonable c ntrol), and after the expiration of all notice and Cure periods as set forth herein, the violating rty shall be deemed to be in default of this Agreement. As a result of a default, the sion-viotatii t Party shall be entitled to parsec 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 dir ently pursuing to cure such default, Hyatt shall have such additional period of Vine as reasonab necessary to cure such default. 5. Mutual Role : ses. Upon execution of this Agreement by the Parties and approval of this .Agreement by the Mia City Commission, the following shall be effective: A. '€ty'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 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, employees, affiliates, successors, assigns, trustees, bankruptcy trustees representatives, beneficiaries, devisees, and legatees (hereinafter referred to Releasees"), whether past, present or future, jointly and severally, of and fr debts, claims, demands, actions, causes of action, rights, obligation liabilities of any and every kind or nature whatsoever, in law or in equi future, known or unknown, direct or indirect, asserted or unasserted whether contemplated or not, whether based in tort, contract, con type of recovery, and whether for compensatory, consequenti punitive, or other damages, which the City Releasors have, may the following claims: (I )the Fire Atwell 'Project, (2) Tile Pi Concession Fees, (5) .Maintenance Costs, (6) Other Fees replacement project including, , the Chiller Overpayment depreciation payments including without limitation the the "Released Claims"); provided, however, that this not release any Claims other than the Released Clai fficers, personal the "Hyatt ni any and all damages, and , past, present, or ixed or contingent, ibution, or any other , incidental, statutory, lave or had arising out of ect, (3) HVAC Project, (4) 7) cooling tower and chiller d the Phase I Design Fees, (8) epreciation Credit (collectively, elease by the City Releasors does B. Elyatt's Release to the City: Except for the ri:' ts, duties and obligations of City created under this Agreement, the Hyatt, for itself an• its predecessors, agents, directors, officers, members, employees, affiliates, successors, . ssigns, trustees, bankruptcy trustees, personal representatives, beneficiaries, devisees, a legatees (hereinafter collectively referred to firs the "Hyatt Releasors"), hereby releas and forever discharges City and each of its respective subsidiaries, predecessoragents, managers, attorneys, director's, officers, employees, affiliates, successors assigns, trustees, bankruptcy trustees, personal representatives, beneficiaries, de sees, and legatees (hereinafter referred to as the "City Releasees"), whether past, pies 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 id or nature whatsoever, in law or in equity, past, present, or future, known or unkuow•, direct or indirect, asserted or unasserted, fixed or contingent, whether contemplated + 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 Ilyatt Releasors have, may have or had arising out of the Released C ims; provided, however, that this Release by the Hyatt Releasors doers not release any aims other than the Released Claims, 6. No Admission of bility. Each Party expressly recognizes that this Agreement shall not in any way be construe( as an admission by any Party hereto of any unlawful or wrongful acts or omissions wha ..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 deny 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 sents that no part of any asserted and/or assertable claims has been assigned or transferred, ai 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 terins of this Agreement shall exist in the Eleventh Judicial Circuit, Miami -Dade County. The Parties expressly select, as their venue, any a otion/litigation in Eleventh Judicial Circuit, Miami -Dade County of the State of Floor' further acknowledged arid agreed that any claim, dispute, action (administrative or o and/or litigation relating to this Agreement, that the Parties shall bear, at their sol expense, their own attorneys° fees and costs. a all . it is ierwise), respective 9. Notices. Except where this Agreement expressly provides otherwise, all r. tices 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 thrbusiness 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- lent), 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 a 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, 10t'' Floor Miami, FL 33130 With a copy to: City of Miami Dept. of Real Estate & Asset M agement 444 SW 2nd Avenue, Suite 32 Miami, FL 33130 City of Miami Ofliee of the City Att '. ney 444 SW 2 Avenue, he 945 Miami, FL 33130 10. Miscellaneous. The P rties further agree as follows: HYATT Hyatt Equities, L.L.C. Hyatt Center 71 South Wacker Drive 12`h Floor Chicago, fL 60606 Attention: Megan Schmollinger With aFofsyto: Hyatt Corporation 71 South Wacker Drive 12`h 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 default of the same or similar nature. 13, Ea i Party hereto shall cooperate, shall take such further action and shall execute and liver such further documents as niay be reasonably requested by any other Party in order o 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 authority to be illegal or otherwise invalid, such provision shall be given its legal caning or be construed as deleted as such authority determines, and the remind of this Agreement shall be construed to be in full force and effect. 13. 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 tFr have carefully read and fully understand of the provisions, tcrms 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 ereion or duress and based on their own judgment. 12. Successors utd Assigns. This Agreement shall be binding up • l and inure to the benefit of the Parties, their personal representatives, successors, and assigns 13. Interpretation, The Parties hereby aeknowledgeand agre; that; (a) in the negotiation and drafting of this Agreement, they have each had the opportunity consult with counsel of their choice; (b) each of their counsels has had an opportunity to contr. ruts to the negotiation and drafting of this Agreement; and (c) the principle of construing a doe agent most strictly against its drafter shall not apply with respect to the interpretation of this Agr ment. 14. Entire Agreement. This Agreement constitu s 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, betwa-n the .Parties with respect to such subject matter, This Agreement may .not be modified in any ay unless by written instrument signed by each of the Parries, 15, Authority to .Execute. The Part'-°s represent and warrant that the individuals executing this Agreement on each Party's beha have the full authority to do so. 16. City Commission Approv This Agreement is subject o the review and approval of the Miami City Commission and therefore this Agreenier . shall be effective as of the date of execution by the City after obtaining such approval. [Signatures Oil following page] CITY OF MIAMI, a municipal corporation Attest: Daniel :r, Alfonso, City Manager Todd B, Hannon, City Clerk APPROVED AS TO LEGAL FORM AND APPROVED AS TO P' SURANCE CORRECTNESS: REQUIREMENTS: Victoria Mendez City Attorney IIYA.T'I' EQUITIES, L.,C, By: Its: Ann -Marie ape Risk Man. •ement Director ttest: Printed Naine :Prinked Name Exhibit A Flooring Repair Arca [Attached] 1 / TERRACE WATERPROOFING HYATT 400 SOUTH MIAMI, REGENCY EAST FLORIDA SECOND REPAIRS MIAMI AVENUE 33131 % w.e a >no ... <: r `• "• NOTES KEY PLAN GENEFLA Oi=3 0!e&W Cor:9T 1 C�1eOTES NC. 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KEY PANsa AND KITS Wm...a ea.tl MR., PNa.ea TVWpe . w DRAWING INDEX �.saRentelaSe c.w..eunexso.rawnt.-a. 0 xn•rwe..z.c..a. "wa•.. .T+.s a.HeC+ ?At KEY W.4 fJ:'M. ti (AILS .a.9. PPOTSS 991 ea :Uk le -+. LEGS,* S fr.,13 I Eg . z •&13K4F,QE KAN TERRACE voCEP.9o—DFING REP', 1:1I 11 TAM' 1,Zeg'‹`" TERgitt [ i'fiTICAL, TERRACE SECTION - TN Ncvaira #T11 4Ch4 1 tite.. i 1 1 \Y li 1 ! fi}, sv ( TYPICAL X(PACiSTON JO N7 DETAI 7JIA'le t+.t z..7404. AT FIANTEF, DET LA7 BUILDING W. x .VP9,.., 44434 re 1 tr Fr '1Y J__,..L.A...NTAIR CRAIN IYETAL ® .Cal'PRMAST PANEL JOSNT DEZttir TYPICAL T�._= DRAIN DETAIL xti: r. cv.a L TERRACE SECT1C:y KITH CONCRETE wE.aAING 3LFBB oi7iia yt� i$ Ekaidim CETAELS 2C' iMIAMis AND CURIPPONAt. s r D'}+.PJGfi LSMATED>..l+NTER . SASE Gc GIIRT. AUNVYAL1, ei.. wnssiv.t re -., TYPICAL LuGFfT PD5Ts NOT USEO NOT USED gLAN"ES AT WE&T 51AE CiTY ?)CYCLE E STATIO>t$ TZPIG: 1"..MT . RT WEST 616E WATER• REr403 M TT 4EaC� WAY! Yi. w. 'wYy Q Ly'1P�SiM1Y1V.L P 4Di0.5 99105 A 3 Exhibit B November 12, 2012 Letter [Attached] K arrle L. . wd Senior ',anise! 71 South Wac •r Dtive Chicago, IL r►606 USA T: + 12.780.3467 November 12, 2012 Via Email (htorre@riarnnigpv.com) Mr. Henry Torre Director City of Ivilarni Public Facilities Division !Asset Ivlanugement Division 444 SW 2"`i Avenue, 3`d Floor Miami, FL 33130 Re: Hyatt Regency Miami (the "motet"); Lease an. Agreement for Development dated September 13, 1979 (the "Lease") bet' ' en the City of Miami (the "City") and Hyau Equities, L.L.C. ("Hyatt"), as a nded; Operations and Maintenance Agreement between the City and Hyatt ` a &M Agreement") Dear Henry: I am writing to follow-up on the ou ding matters following our conference call on August 29, 2012 (the "August 29 Cal ) and to respond to your offer of a one-time waiver of overtime charges of $28,O00 in change, 1 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 so includes Hyatt 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 Hyatt's position a at the concession fees are not properly due and payable and have been wrongfully ch ged to Hyatt by the City, Second, the City has not responded to Hyatt's request made ,.•ring the August 29 CaII 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 items are in dispute by Hyatt and were discussed during the August 29 Call. Man items, as notect 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 cone ssion fee for events (ticketed and non -ticketed events) at the dances 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 H; att are not supported by City ordinance, the Lease, the O&M Agreement or custom and ttactice in the industry. City Code Sec. 53-181(1)(a) created a new category of charges or food/beverage concession with respect to meetings or general sessions in the Th 5 r/Auditorium, The ordinance shows the concession fees as a charge for use of the 7 t:.ter/auditorium space and real as a ebarge to the concessionaire. Moreover, per the 0 , finance, this charge does not apply to exhibits or ticketed events in the Theater/midi :.dam. 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 violatio 'f the Code. Section 8.3(a) of the Lease establishes Hyatt as the s. - provider of food and beverage services for the Convention Center, without charg= 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 conces on fees to Hyatt for its concessionaire services is also in violation of this provision of Lease. Correspondence from 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 Hall . 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 Lase and the O&M Agreement do not support a clean-up fee to H , tt in counection with its concession services. If the concession charges in sec. 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 llyattis the lessee of 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 Cera r, Yackie Gleason Theater on Miami Beach and the Adrienne Arsht Center) do not chugany concession fees or clean-up fees to their concessionaires, Rather, any concess in fee or clean-up fee is charged to the third party user/renter of the space andlor includd in the rental fee. Ie advise as to the City's basis for charging Hyatt the concession fees pursuant to the ode. Henry Torre November 1.2, 2012 Page 3 of 5 I1eetine Room Rates 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. contrary to the City's assertion that increases to meeting room rates at the Convention C ter are not subject to City Commis€on approval and do not require an amendment to 5 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 and 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 cntion 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 _ r fees for the Knight Center and all entities using the facilities must cornply." Moreover, the City's own website for the Conveniia Center lists a fee schedule for meeting space rentals less than the amounts charged ' att for thesame 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 clanged 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 Theatre/Auditorium. Among the item dentified 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 1(d) only appl' s to the "'TheateriAuditorium rates." Section 1(d) does not apply to "Meeting and semi : r space" (Section 2) or "Exhibit Hall" (Section 3). Please advise as to the City', basis for increasing fees for the meeting space without first seeking City Commission 'pproval and an amendment to Section 53-181 for theater and auditorium rates, and fi charging rates for the meeting space to Hyatt in excess of those being charged to third E : 'es. Cleaning Fees. The City char yes Hyatt a $500 cleaning fee for any concession event held in the Convention. i .ntc,r. Hyatt is the sole concessionaire under the. Lease, and there is no charge far 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 r accity 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 at be charged to Hyatt. Please discontinue the City's charging of these fees to Hyatt rnediately. Hyatt reserves all rights and remedies with respect to these charges under t base, 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 See. 53-181 of the Code. This sere` e is included in the rent for the facility and should not be additionally charged. During the August 29 Cali, 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. RealstratiQn.fga. 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 the amount of the charge, During our August 29 Call, the ,G�`ity agreed to review and respond to Hyatt. Hyatt has not received aresponse. Overtime Rates. The City advised that it 11 charge overtime rates for events that exceed eight hours, occur on weekends, or req 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 ''heater/Auditoriux: that are permitted by Sec.53.1S1(1Xd), During our Au, st 29 Call, the City agreed to review and respond to Hyatt. Hyatt has not received a ronse, other than the offer of a one-time waiver. However, no basis for why these char s are proper has been provided. Sec on 8.4 of the Lease requires the City to maintain and operate the Convention Center i rood clean order and condition as a first-class facility. The City is required to maintain d adequate staff to do so. if the City (Ices 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 Niainteuance Fees due ll vatt The City currently owes Hyatt approximately $43,318.00 for its share of main mince costs for the Central Plant. The City originally advised Hyatt that it ceased reiefbursing Hyatt for the maintenance costs in an effort to offset these amounts against the ounts the City claims that Hyatt owes for concession fees. However, as noted abo e, Hyatt does not believe the concession fees are owed and has beea disputing these ees. Moreover, the Lease does not provide fora right of offset. Then, during our Augu: 29 Call, it was made clear by the City, that the failure to pay these charges was s tly a matter of budget shortfalls, Yet, the services are still being provided to the City, nd Hyatt continues to pay for the City's portion of these fees. Please arrange for the im diate payment of the City's portion of the maintenance costs that are overdue. Nothing contained herein shall be deemed a waiver of y of Hyatt's rights and ieinedies 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, Kerrie Dowd cc (via e-mail): Dave Phillip Luis Alom Veronica iques Daniel F ewhoff Exhibit C Memorandum of Understanding [Attached] [End of current) f 1Ut i �t 4ti: SS_ y iir jilt I4.tS 14, March 21, 201' Tiffany Lendb tter Donato Senior Vice President Capital Strategy, Real Estate Trartsactiottrs Hyatt Hotels Corporation 71 South Wacker Drive Chicago, IL 60606 Re; Memorandum of Understanding: (1) Amended and Rest Dear Mrs. Donato: Land Lease Hyatt Equities, L.L.C. (" Hyatt")rind the City ofliionti ( ") (collectively, the "Parties') desire to amend and restate their existing land lease relationship, and ha v lyntt redevelop the Property (as anticipated and defined in the Term Sheet attached hereto), upon wh' lr the existing Hyaft .Regency Hotel and James L Knight convention center occupy. The following pa '• raplts set forth the basic ternns.arnd conditions upon which said relationship shall be structured subjc to the negotiation and execution of an amended and restated land lease (the "New Lease,''), and the o er terms and conditions contained in the Term Sheet. At the minimum, said agreement is anticipated to ' corporate the following: 1) The Parties will enter into an int itu agreement with respect to the Existing Ground Lease (as defined in the Term Sheet) to a ress certain immediate needx of the Hotel between the date- of such agreement until the New ..ease is entered into and the redevelopment process commences, including, without linritatioi an agreement on the payment of certain shored expenses on a going - forward basis and an agree ent of the Parties to stay current on such obligations during, the 'interim period. 2) The Parties shalt in a. Extend th b. Expand space' c. Ant- id and restate the parking agreement to accommodate a. and b. above; c'l 1 'onjttnction with the New Lease and upon termination .of the Existing Ground Lease, as greed by both Parties, resolve and -absolve (except to the extent the Parties resolve to have continuing obligations thereafter, such as a payment plate) the Parties from, current disputed financial obligations for capital improvement projects undertaken, revenue and expense sharing agreements and other tatters. Any agreed upon payment plan for such outstanding amounts shall he 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, Myatt shall explore the use of the additional development rights on (he Property;. ii. Hyatt shall engage directly Cf3RE, Inc. to seek qualified development partners to maximize the Property's development potential and density; additional to modify the Existing Ground Lease, including, without limitation, to: and lease term plus extensions- to a total of 99 years; leased premises to include the James L Knight convention centerhneeting development could include but not be limited to residential, office, parking; iii. Seek possible development partners, taking into consideration and Financial capacity of said partners., programmatic and ae financial benefit anticipated to inure to the benefit of 1-[yntt to iv. The Parties will mutually agree upon n !taster Plan (as defii Tor the redevelopment of the Property. When fully executed, this Memorandum of Understanding (together with the "A'ttachment. A:, and incorporated herein (the "Term. Sheet"), the "fv10l1") l fyatt'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. New Lease. Subject to certain conditions as set forth in the MOU b rig satisfied, the New Lease will be negotiated to reflect the intended deal terms set forth in the MOU. Exclusivity. From the date hereof through March 31, 2017 (the Exclusivity Period"), City shall negotiate exchisively with Hyatt for the redevelopment of these pane., provided, however, that in the event the Parties mutually agree in writing, or Hyatt notifies City in tting of its intention to cease the negotiations prior to such date, then the Exclusivity Period shall expire n the date ofeessation of negotiations. Confidentiality. The terms of this MOU and the New ease, as well as any non-public information related to the transactions shall be maintained as confidcntii by the Parties, except for (i) disclosures required by, law (specifically including Florida Statute Chapt 119) or rules :of applicable securities exchanges, (li) disclosures to the Parties' respective board amen ors, agents, employees, attorneys, accountants, brokers, contractors, lenders, prospective tenders, inve:'ors, prospective investors, consultants, advisors or other representations, and (lii) disclosures that the parties mutually agree in advance are required or desirable to advance Zoning Entitlements (as defined the Term Sheet) or other public approvals or concessions or information tire 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 ar public announcement. Non -Dimling. This MOU shall it create. any legally binding obligations on the Parties, other than i;vil'lt Tigard to the Exclusivity and C.ritident iality provisions set forth above. Except for such provisions, City and Hyatt shall heat have any + ligallons to each other unless and until frill execution of the New Lease. If a New Lease is not execut by expiration of the Exclusivity Period, unless otherwise agreed to by the Parties in writing, this Mi slla l automatically terminate, other than the above Confidentiality provision, which shall survive ter nation for one (I) year, In addition, this MU shall terminate in its entirety upon the full execution_ oft' New Lease. tail, and/or qualifications etic design, and the City. d in the Term Sheet) a sheet attached hereto es all reflect the expression of or the purposes o this discussion, this MOU and subsequent contract documents wilt require approval of i ion. Thar process may include the item being placed on the Commission Agenda, i,' and °a readings a I then- final approval. The final New Lease shall also require approval by the voters at Each of the City and Hyatt, and their respective affiliates, representatives, and associated ntit'res spa .i use commercially reasonable efforts to comply, inatl material respects, with all applicable ria s, regulation, disclosures,. and statutes (whether heal, state, or federal), to include the Miami 21 raiain ordinance, in the pe.rfarmanceofthis arany agreement, instrument, or actions)reliztivetothe MOU N Lease. The City shall eooperate with Hyatt, its affiliates, representatives and associated entities to hate and expedite approvals and conformance with local, state, or federal ordinances as may be asonabiy required. the City Conlin Referendum laws, R i la z or fa t. 2 The Parties understand that this MOU and any subsequent contract documents will requ'a tirc applicable internal approvals of Hyatt. including the approval of Hyatt's Development Comtrtttee, the Finance Committee of Hyatt's Board of Directors, and Hyatt`s Board of Directors, If you are in agreement with the terms or this MOU, please indicate saute b counter -signing where indicated below. We look Forward to moving forward with you on this importa ' project. Sincerely, CITY OF MIAMI, a municipal corporation of the State of Florida By: Daniel 1. Alfonso City Mlruaager Accepted and Agreed to; k1YATT EQUITIES, L.L.C. By: Name: Title: ATTACHMENT A TERM SHEET This term sheet ("'Perm Slims'). dated this _ day of , 2016, is a propos only, and is not contractually- or legally binding.. it represents only an expression oldie parties' present sire and intention to enter into 'legal inrions of'aa possible agreement to lease the Property (as defined bets ) by Hyatt (drafinecl below) from City (defined below). City and Hyatt are sometimes collectively r erred to herein as the "Parties" or individually as a -Party", The outline of the general terms and condi .ns are as follows: 1. GENERAL: 1,1. PARTLES TO NEW LEASE: 1.1.1, Hyatt Equities, L.L,C„ or an affiliate thereof as ground lessee and developer, if applicable ("Hyatt''); Hyatt niay enter into ubaequent agreements, with City of t1 ianti ("City") approval as may be reequirsi render the New Lease or by.applicable law, ineludinq„ without limitation, ; ,rill venture agreements, development agreements or subleases with prospect' 'e partners, developers or other third parties in connection with the performance ' its duties under the New Lease; and 1. t .2. City of lvlituni, as ground lessor 1.2. THE Pt t)P_l_RTY: City and Hyatt will .iter into an amended and restated lease (the "Hew Lease") of the existing Ground Lease ► n-suant to which Lessee currently leases front Lessor the real property (the -Hotel Land") pon which the Hyatt Regency Miami (the "Hotel") is located (the"Existing Ground Las• '), Pursuant to the New Lease., (i) the City will continue to lease to Hyatt, and Hyatt will c. itinue to lease from the City, all of the City's right, title and interest in the Hotel Land, inc lu. itg any City interest in the Hotel glad any other improvements, furniture, fixtures, and pert; ral property located otr the Hotel Land and any additional development. air or otter r' ;firs appurtenant to the Hotel Land not currently provided in the ex[ating land lease, as agr' d by the Cite pursuant to the approved Master Plan, and (ii) the City will agree to lease . Hyatt, and Hyatt will agree to false from the City, the real property upon which The Jam . L. Knight Miami Convention Center (the "Cpnvelttion Canter") is located (the "Co, ion Center Land"), includ-ing, without limitation, the Convention Center end ell other impr.veenents located on the Convention Center Land, any City interest in the furniture, fi tur , improvements And personal property Located en the Convention Center Land and any additi raI development, air or other rights appurtenant to the Convention Center Land its agreed by is City pursuant to the approved Master Plan ((i) and (ii) are collectively referred to herein i the "Property"). 1.3, DUE t► .I;IGENCE: Hyatt: shall complete all due diligence work it deems necessary or tidy .le on the Property prior to its execution of the New Lease, ut its sole cost and expense, inc iding without limitation, tide, survey, soils, environmental and all feasibility studies and t+.ts. City and Hyatt shall execute a separate commercially reasonable access agreement anting Hyatt ,and its agents and consultants access to the Property in order to conduct the requisite tests and studies, subject to c ustomury 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, survey's and title reports resulting from its due diligence activities related to the Property. 1 Subject to st h access agreement, City will grant Hyatt immediate and reasonable acc to the: Property, the Parking Garage, the Property records, and the Convention Center n agennent team and other employees for the purpose of inspecting the: physical condition of . e Property (including for the purpost of soil and other environmental tests and mechan' ,tl and other inspections) and evaluating the Convention Center business, in flvutt's sole liscretion. The City shall deliver copies to or provides access to Hyatt of all Property rec. cis within City's possession, or the possessionof its Convention Center manager,, aftrliates. consultants, agents, representatives or employees, including, without limitation, environma tal reports, property reports, title commitments and policies, surveys, building plans, corms r i nc-lvtrce with or notices from any governmental agencies, information pertaining to any la w• it(s) pending against the Convention Center, the Hotel or the Property, and any other infor ation reasonably requested by f lyntt, 2 RE DE VE,LOPNTLNT: ,1 Within [twelve (12)1 months of execution of this Term She t, Hyatt shall prepare, and deliver to the City for iN review, a master plan (the "Master Plan" for the redevelopment of tlw Property (the "Pr•oiect"). The Master Plan shall include, amo other components: parcel development plats (for a Hyatt hotel, meeting space and other typi j l hotel amenities, and expanded mixed use development that may occur on the site), finarrcin equity plans for the Project; strategy for the use of public 'hinds, public funding mechanism or public assets inchidinguse plans, desired densities, design cr'steria for base buildings a public spaces, a proposed streetscape. a retail merchandising plan to the extent retail is an lenient of the development, an infrastructure plan and a parking plan. 'The Master Plan shunt d include proposed development that maximizes the site's density and proposed Project phnsit If agreed upon, the Master 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. if Hyatt and the City, in their di cretioa, determine. to proceed with the Project based upon an agreed upa:r Master Plan arid t tits to the Now Lease, Hlyatt's obligations under the: New Lease shall include, among other r quirernatnts: (i) to redevelop the Property as contemplated by the Master Plan: (ii) to obtain oning Entitlements (defined below) as necessary, For the Property to permit development ofsa te; (iii) to secure the requisite equity investment and financing necessary for the Project within e parrtnieters set Forth in the New Lease, (iv) to adequately address all infrastructure require tints necessary for the timely development of the Property, (v) to develop a plan to adequately ;:dress parking requirements for the Project (vi) to construct the irnprovements hat accordance iv' n the ivlastcr Flare and plans otherwise approved by the. City pursuant to the normal 'Tannin ^ and perrniitinp process; and (vii) to operate and maintain the buildings-, grounds, and infrastruarc in the manner prescribed by the New Lease throughout the terra of the New Lease. 2.3. if the P rties.elect to proceed with the Project, Hyatt shall take the lead, at its expense, in obtaining all titlernerats for the. Property to accommodate the approved Master Plan ("Zoning En;dements"). The City shall use its best efforts to assist and reasonably cooperate with Hyatt raugirout the Zoning and Entitlement process. . in the event that tiro Parties elect, or either Party elects, to not proceed with the Project, the Parties slunll have no obligations hereunder other than the confidentiality provisions. 3. NEW LEASE: 3.1. EFFECTIVE DATE OF LEASE; TERM, The New lease s)iall be effective (the "Effective Date") upon execution by the Pa Party having obtained all necessary approvals as set forth in the MOU and this the Parties having agreed upon the Master Plan, which will be attached to the initial terns far the New Lease shall be from the date ol`ground lease excctitio .]Jars") though Dei:etnber 31 of thc;year that contains the 99h anniversary. Date, 3.2, GROUND .RfNT: a. Fitt l-earl and Adjo:pling,Ja meal.. Knight Convention C er ies, and each rna Sheet and s.w Lease. The ("Commencement the Coinnnencenacnt On or before limitary 1" of e each lease year, Hyatt sha pay to the City base rent (,*Base Rents") for tile Property as follows: During the construction period: Base Rent (to be pairs by Hyatt, or the rlevel per of the Pruject, during the construction period) for the Property shall be the followi Year one (I) during the construction period Year two (2) during the cortstIYnction riod Year three (3) during the construetk period $0 $500,000 $500,000 Thereafter and onFvin<a. Hyatt s . IF av to the City not less than: Two million do tars ($2fiti),00t1) per year (as may be escalated from year to year). or, ii. The math *atical average of two appraisals commissioned by the City for the land un< r which the hotelis constructer) plus space occupied by the James L. Knigh convention cart; i. The formula for the eslticblisltrnent of base rent for the hot e property and James L. Knight center shall be five percent.(5%) multiplied by ie mathematical average of appraised value. Should 5% ol'ihe naathetnatical erase of two appraisal exceed two million $(2,000,000) per year (as inay 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 plus 5% of gross beverage receipts, pus 3% of -food 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 avoidantre or doubt, Fiytstt shall not pay any other rent or fees to the City for space: utilized in the operation ol`the hotel and meeting space on the Properly. 3 b, Profits Puft'clpatigta fir i' S{�lirt let! l7rvs?Icautrent nit the Property in addition to Base Rent for the Hotel and meeting space, alter the construct ier period, the owner of the non-l--lotcl component of the Project shall pay to the City a prof"' participation rent ("Participation Rent") with respect to the other income produoi areas or the Property, other than the Howl and Hotel Land and meeting space, deter 'red as the greater of: I) 2) A to be determined percentage of gross profit e development on the Property ias defined it) the agree of the Property; and Rent formulaically determined by: i. A current appraisal of the property 0 L. Knight Convention Center as a An appraisal of the land area -Convention Center land and performed and determined fo tit. The difference between hl ,James L. Knight Conve cif the. Hotel and Co contribution to the e rl. led with expanded nt for the redevelopment copied by the llotel and James in,g concern" shalt be performed. he Hotel and James L. Knight all appurtenant air rights shall be "highest and hest use" lest and best use value of the Howl and on Center land and value of going concern cation Center shall be the City's financial ended development. See Bolos E;xa.ntjjc for emoitstration Purposes Only: Tliultust . Best Use , Itre of HOW and Con . talon X SI 00.000,000 Center Land Less: Value of -hotel and Y $6O,000„0O0 Convention Center as Cfoing Con n't E. teals; C` v Contribution Z $40,000,000 City '& +ntribution shall be treated as a limited partner equity investment, Notw i tending the fbregoirto, the City shall not be a ,joint venturer or par er with Hyatt; any references to partner equity investment and similar t ms are solely for purposes ofcaioulating Participation Rent. Therefore, If ley total investment for the expanded development is A $200,000,000 then City's prom participation using the example above shall be 204rii of Z ($40,000,0OO) divided by A (3200,000,000) . The numerator is equal to Z ( 0,OOO,OOO) and the denominator is A ($2OO,OOO,000) which produces the City's equity ccantribution of 20%. 3.3. A , JAL ESCALATOR: t the Ssr= anniversary of the enmi.nenceinant of the New Lease, and on each Sir' anniversary .reafter during the remaining Term or extensions thereof, the minimum Base R:ent shall be the cumulative compounded increase in the Consumer Price Index for All Urban Consumers (C.Pt-U) Miami; provided, however, that the increase in Base Rent shoal I in no event be less than two percent (2,0%) per year. 4 3.4. NET LEASE: The New Lease shall be absolutely net to City, and Hyatt shall pay all read estate taxes t peratin ft and tither related expenses during the term thereof. 3.5 SUBORDINATION: The NOV Lease:, any leasehold interests created thereby and any security utter (to lenders., equity providers and the like) shall he subordinate to City''s fee Property at all tunes throughout the New Lease term or extensions thcr that the Parties shall record a mentora.ndurn of lease against tlic Propert priority to any encumbrance on City's fee simple interest in the Hotel Land and reversionary interest in the improvements nn such lands. 3.6 PARKING: The Neu Lease will provide Hyatt with all the: same parkin respect to the Hotel under the Existing Ground Lease. T to reasonably apportion parkin in the GI Garage to pro Project. Notwithstanding the foregoing, as part Of the portion of tlte- parkin requirements for the Project Plan for the Property (separate and apart from par 33 ASSIGNMENT AND DiSPOSITION RIGFFI' With City's: prior written approval. Hyatt worth of CS j and either engages a manager who is a First CI company or product type than enjo Corporation and the Hyatt Regenc is granted therein merest hi the subject f; provided, however, which shall be senior in id and Convention Center rights currently held by Hyatt with 'arties will cooperate with each other e nec.essaiy additional. parking for the .oject, I-lyatt may propose that all or some. met by proposed. parking within the Master g within the Parking Garage). y assign the Now .Lease to an assignee that has a net to{d..s 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 8unilar to that of Hyatt product. Hy-ati',s ability to mortgage, pl go or conditionally assign the New Lease to teasel Id mortgages shelf be as provided in the N Lease. 3,8 MORTGAGEE PROTEC ONS: I'lte New Lease shall i elude customary and corniuerciall ' reasonable provisions for the benefit of 1 {yan's lender, inolt mg, without lintita.tion, the right of lender (i) to receive notices of any }Myatt defaults or terntin . tun by City, (ii) to cure any N-yaIt defaults -within a reasonable grace period, and (iii) upon terrnu ttion of the. Nov Lease, to enter into a now lease directly with City on the saute terms and cot f itions as the New Lease upon lender's cure: of Ali ofl-lyatt's prior defaults, to the extent su se , tib le of being cared, 3.9 0111E1 EMS AND CONDITIONS: It ornt of New Lease shall include other terms and conditions that are normal and customary similar projects and as agreed to by Hyatt and City. 5 4. PUBLIC FUNDING: City shall reasonably cooperate with and assist Hyatt in obtaining available governnten . ineeirtives (such as, by way of example, :sales tax relief on construction materials, TIF-type ittc • gives. etc.) in connection with the New Lease and the investment by Hyatt in the redevelopment of to Property, 5. COMMUNITY OUTREACH AND STAKEHOLDER MEETINGS: The Ground Lease shall sot forth the parameters and the Parties' respective rnl And obligations related to ail community outreach and stakeholder meetings to be conducted inco neetion with the Zoning Entitlements or otherwise related to the design rind development ofthc Pr•;cct. 6. REM, ESTATE BROKERS: C13R.E was hired by the City through State of Florida Contract. I7+ 5-12/I3-OO7A. Hyatt intends to en age CBRE in connection with the Projeet. Other than Cl3RF ine,. whose duties and loyalties are solely to the City, no other real estate broker or consultant to w out a conttnission or fee shall be cftte has been engaged by either party. Upon execution of the ew Lease by the Parties, City shall be responsible to pay to CARE, inc. as part of its developmen osts a commission for the 'New Lease as is set forth in n separate aureetncnt between CBRE, Inc. and the City. City and Hyatt acknowledge C: BRE's representation of the City and agree- t hat the Ne Lease or colter agreement between the Parties to acquire the Property will occlude said C.ontrtt]Ssion a„ cement by reference, Hyatt shall be responsible for costs associated with 1 lyan`s direct engagement f CBRE for all new development (including tho construction or• reconrtruciion of a hotel and any dditk naf development on the Property pursuant to this Tcrtn..Shcet pursuant to a separate agreemc between Hyatt and CB RE, 7, EXISTING LEASE TERMINATION: The Existing Ground Lease. and related a wrnents will be terminatad effective as of the Effective Date of the New Lease, with each Party rele• mg any claims (whether known or unknown) against the other Party. IL CONVENTION CENTER MAN GL-,R: The management agreement ' r the Convention Center with the current manager will be terntinated as or the Effective Date or ti New Lease. with Lessor paying any outstanding fees and any required termination fees. 9, PRORA'FFONS: Real estate taxes special assessments, utilities, rents and other amounts will be prorated as of the Effective Date' a usual and customary manner for a transaction of this type. 10, TfL'LE: AS oft Effective Date of the New Lease, the Property will be lensed fi ee.of arty liens and mortgages and n y leases, tenancies or occupancies, or any other encumbrances, or any defect in title to the Pro erty that are not ar:cepted by Hyatt in accordance with the terms of the New Lease and will be st +ject to receipt of a satisfactory title insurance policy. _ 6 11. REPR ESENTAT1ONS AND WARRANTIES: Each Pariy will male customary representations and warranties to the outer Party this type, as of the date of the execution of the New Lease. 12. COVENANTS, Each Party will agree to customary covenants for a transaction coatis type. 13, PROPERTY CONVEYED "AS 1S": Except us specifically set forth in the New Lease, t11a Property will b conveyed in "as is'l cttttditiean. 14. TRANSACTION COSTS: or transaction aF The City shrill be responsible F',tr the payment of all traatsfetaxes and revordation fees and the title insttraneepremium. All other transaction costs will be paid ' accordance with local custom for similar large commercial hotel transactions, Each party wilt pay air own attorney' fees. 1.5. DELIVERIES: At or before the Effective Date of the Newtease the New Lease, (ii) an assignment and assutrtpt and assumption of all operating agreements, subleases related t4 the Property (to the exte. (v). estoppels for the benefit of Hyatt a documents reasonably necessary fro and/or deliver• (i) an assignment and a of intangibles, (iii) a hill orsale, and from Hyatt to complete the New 16. MISCELLANEOUS: ity will agree to properly execute rind/or deliver(i) n of intangibles, (iii) a bill of sale, (iv) an assignment iprnent leases, services contracts and other krises and accepted by Hyatt in the New Lease) (the"Agreeme ats"), reasonably requested by Hyatt, (vi) all other customary to complete the New Lease. Hyatt will properly execute urnption of all Agreements, (n) an assigrttl3eflt and assumption ,) all other customary documents and funds reasonably necessary ase. 16,1, DEVt LOPrMIEN1 RO FO1tMAS: Hyatt provide t e City with development pro fr,rtn<ns Far rennv-ated existing or new hotel and any outer ni i. d use development to occur on the site. 16.2. CON /11vI (CATIONS: Tlie N w [.ease shall establish a communications protocol (e.g., reports, meetings, designated repr 'entatives) to maintain open andcontinuous lines of communication between the Parties w'r t respect to all design, entitlement, development and programming activities related to the aerty, 16,3. DISPUTES: Ali disputes under the New (.ease 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 Part thereunder and will set forth the reinedies available to the non -defaulting Party hi the ever' of a default. 16.5. NO ASSIGNMMMENT: Except as set forth in Section 3.7 above, neither Party shall be p rrnitt:ed to assign, transfer or otherwise convey its interests, rights or obligations under tl ' New Lease without written approval of the other Party. This Tern Sheet due no.i COnatitute an offer to lease the Property and any of the terms contained herein binding on either of the Parties. 1: obligate either Party to proceed with a transaction in any way whn wlien the Parties execute a New Lease". Without limitation onto acknowledge that no Party shrill have any obligation °fatly kind such Party actually executes and delivers the New lease our any time to withdraw from firrthcr negotiation or consitier,rt any rt"ason or for m reason in Hyatt's or the City"s sole at or nature to the other Party hereto. 8 not subject to acceptance, nor arc rther•rnore, this Term Sheet does not •ocvet. ']'here shall be agreement only regning (A) Hyatt and City specifically r nature to the other Party unless and until (13) Hyatt and the City reserves the right at 7n of the transaction contemplated hereby for absolute discretion without liability of any kind