264-97 RDA

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1/48

RESOLUTIONNO.

2 6 4 -

97

E S O L U T I O N

OHE

CHAIRMAN

AND

M E M B E R S OF

HE

MAM

EACH

REDEVELOPMENT

A G E N C Y

APPROVNGAND

AUTHORIZING THE

CHAIRMAN

AND

SECRETARY

TO

EXECUTE,THET T A C H E D

LETTERO

NTENT

B E T W E E N

TH E

CTY

OFIAMI

BEACH,

THE

MAM

EACH

E D E V E L O P M E N T

AGENCY,

RDP ROYAL

PALM

HOTEL

LIMITED C O M P A N Y

AND

DPHORECREST

HOTEL

LMTED

C O M P A N Y

REGARDING

THE

W N E R S H I P , DEVELOPMENT AN D

O P E R A T I O N

OA

CONVENTION

HOTEL.

W H E R E A S ,

RDP Royal Pam

Hote

Limited

C o m p a n y (

RDP Royal

Pam)

wa s s e l e c t e d

as

he

i n n i n g

bdder

in

response

to

Request

fo

P r o p o s a l s

N u m b e r

45

95

96 ("

RFP")

o

develop,

own

and

operae

an

fr ican-

A m e r i c a n

owned

c o n v e n t i o n c e n t e r

hoe

in

i a m i B e a c h ;

andH E R E A S ,

r e p r e s e n t a t i v e s

of

the

R e d e v e l o p m e n t

Agency (

RDA"),

he

City

o

M i a m i

Beach (the "

City"),

RDP

oyal

Pam

and

RDP

S h o r e c r e s t

Hotel

Lim i ted C o m p a n y ( c o l l e c t i v e l y ,

RDPoyal Pam

and

DP Shorec res t H o t e l

L i m i t e d

C o m p a n y

aree f e r r e d

to

s

RDP")

a v e b e e n engaged in

n e g o t i a t i o n s

fo a

um be r

o

o n t h s

regarding,

among

other

things,

he

d e v e l o p m e n t ,

ownership

and o p e r a t i o n

o

he

proposed

h o t e l ; and

W H E R E A S ,

t h e d e v e l o p m e n t

of

he

hotel

isa

art

of

and

is

cons i s t en twth

the

Cty

e n t e r

Hstoco n v e n t i o n V i l l a g e R e d e v e l o p m e n t

and

e v i t a l i z a t i o n

Plan

and

w i l l

e l i m i n a t e

s lum

and

bigh

in

the

Cty

e n t e r

Hstoc

o n v e n t i o n

V i l l a g e

Redevelopment an d

Revi ta l izat ion

Area;

and

W H E R E A S

th e

d e v e l o p m e n t ofthe

hote l

is

au b l i c

p u r p o s e

a n d

wll

ene f i t

the

public

by,among o t h e r

thngs

i n c r e a s i n g

thenumber of

c o n v e n t i o n

q u a l i t y

hotel

r o o m s

in

h e

Cty

ssisting

he

Cty

n

ttracting c o n v e n t i o n s

and

ncreasing

the

u t i l i za t ion ofthe

Convent ion

C e n t e r ,

increasing

t o u r i s m

andm p r o v i n g

the

c o n o m y ;

an d

W H E R E A S ,

the

deve lopmen t

of the

hotelas

e s c r i b e d

in

the

a t t a c h e d

leter

of

intent

LOI")is

uthorizedbyh a p t e r

163

o

he

F l o r i d a

Statutes;

and

W H E R E A S ,

r e p r e s e n t a t i v e so

the

D A ,

the

Cty

n d

R D P ,

sub j e c t tohe

a p p r o v a l

o

the

D A

andhe C i t y, have

nego t i a t e d the

terms

o he LO I

attached

hereo

OW,

T H E R E F O R E ,

BE

T

DULY

E S O L V E D

BY

THE

HAIRMAN

AND

EMBERS

OF

THE

M I A M I

BEACH R E D E V E L O P M E N T

AGENCY as

fo l lows:

1

The

a t t a c h e d LOI

b e t w e e n

the

RDA

the

Cty

nd

RDP

is

e r e b y

a p p r o v e d .2

The

h a i r m a n and

M e m b e r s h e r e b y

f i n d

that

the

e v e l o p m e n t

ohe

hotel

is p u b l i c

p u r p o s e ,

wi l l b e n e f i t

th e

pubicnd

is

a

art

o

and

is

onsistent

with

theity

8/15/2019 264-97 RDA

2/48

3The

h a i r m a n

and

M e m b e r s

h e r e b y

find

that

the

e v e l o p m e n t

ofthe

H o t e l

is

a u t h o r i z e d

by

hapter163

F l o r i d a

Statutes.

4

The

h a i r m a n

and

e c r e t a r yae

u t h o r i z e d

to

x e c u t e

the

attached

LO.

5 he

hief

Negot iator, Executive D i r e c t o r

and

General

C o u n s e l ,

andtherrespective s ta f f sandu t s i d e

c o n s u l t a n t s ,

areauthorized to

negotiate

and

o c u m e n t

the

d e f i n i t i v e a g r e e m e n t s r e l a t i n g to

he

LOand

a k e

al

he

a c t i o n s

ino n n e c t i o n t h e r e w i t h .6

Thse s o l u t i o n

shal

ake

f f e c t immediately

u pon

a d o p t i o n . PASSED

and

A D O P T E D

t h i s

5th

M a r c h

T T E S T

J?

c>

LcM

d-

tM

cb S E C R E T AR Y AITlkwf\

ato

aca\

r e s o s \

aaloiexe.

rda

A P P R O V E D

AS

TO

F O R M &

8/15/2019 264-97 RDA

3/48

Miami Beach

Redevelopment

Agency

1700

onvent ion Center

Drive

Miam Beach,

Forida

33139

Teephone (

305)

673

1 9 3

Fax: (

305)

673-

7772E D E V E L O P M E N T

AGENCY

M E M O R A N D U M

NO.

97

6

A T E :

Mach

5

1997

TO

Chairman

a n d

embers

o

the

oad

f

the

e d e v e l o p m e n t

Agency

FROM

Jose

oarC ia -

pedrotCa

Execu t i ve

Director

R E S O L U T I O N

P R O V I N G

A

E T T E R

O

NTENT

A M O N G

THE

RDP

OYAL

PALM

HOTEL

LTD.

CO

AND

DP

S H O R E C R E S T

HOTEL

LTD

CO(

O L L E C T I V E L Y

RDP),

THE

CTY

O

IAMI

BEACH

AN D

THE

MAM

BEACH

R E D E V E L O P M E N T

AGENCY

FOR

THE

OWNERSHIP,

D E V E L O P M E N T

AND

OPERATION

OF

AN

F R I C A N

AMERICAN

OWNED

HOTEL

AT

1535

N D

1 5 4 5

COLLINS

AVENUE.

S U B J E C T :

R E C O M M E N D A

TON

p p r o v e

the

e s o l u t i o n .

B A C K G R O U N D :

Staff

a n d

c o n s u l t a n t s

for

the

e d e v e l o p m e n t

A g e n c y (

R D A )

and

o m m i s s i o n

have

e g o t i a t e d

a

roposed

l e t te r

o

ntent (

LOl) (

t t a c h e d

h e r e t o )

fo

a

25-

room

hotel

c o m p r i s e d

of258

hote l

rooms

and

167

hoe

suites.

On

June

5

1996,

he

RDA

e lec ted

the

DP

Royal

Palm

Hotel

Ltd.

Company,

f t e r

an

x h a u s t i v e

p u b l i c

r e v i e w

p r o c e s s ,

to

negotiate

the

terms

n d e r

w h i c h

RDP

woud

develop,

ow n

and

o p e r a t e

a

convent ion

hote l

on

the

oyal

Palm

property

and

o p t i o n a l l y

on

the

adjacent

Shorecrest

p r o p e r t y .

Athe

time,

he

eve lope r

had

he

S h o r e c r e s t

H o t e l

u n d e r

c o n t r a c t and

the

successful

p r o p o s a l

c o n t e m p l a t e d

d e v e l o p m e n t of

both

s i tes

operated

under

u n i f o r m

m a n a g e m e n t .

T h u s ,

the

ity

dd

no

a v e

ste

ontrol

on

al

of

the

and.

For

m a n y

months,

he

City'

se g o t i a t o r s

and

taff,

o r k i n g

ina r m o n y

with

Don

eebles,

th e d e v e l o p e r

on

the

LO,

struggled

to pu

th e

d e a l t o g e t h e r

u n d e r

tructure

o

wo

s e p a r a t e o w n e r s h i p s

of

lad

o

8/15/2019 264-97 RDA

4/48

In the

last two

weeks,

by

unanimous consent,

the

chief

nego t ia to r

for

the

RDA

and

Mr.

P e e b l e s

came

toa

conclusion

that

the

s i ng l e -

site

owne rsh i p

was

preferable

and

Mr.

Peebles

ag r e ed

to

transfer

his

contract

interest in

the

Shorecrest

to

the RDA (

fee

and

leasehold).

As

a

result

of

the

agreement,

the

RDA

and Peebles

moved

rapidly

to

a

mutually

accep t ab l e

LOr.

The

LOI,

before

the

RDA

and

City

Commission,

therefore

con t em p l a t e s

com p l e t e

site

control

in

the

hands ofthe

RDA,

as is the

case with the

Loews

Hotel.

The

RDA

made

a

commitment

toall RFP

r e s ponden t s

that

its

f u n d i n g

obligation

would

be

limited

to $

10

i l l i o n .

The

RD A

has

g r e e d

to

u b o r d i n a t e

its

i g h t

to

eceive

ren

under

certan

i r c u m s t a n c e s

to

the

first $

0

million

in

i n a n c i n g

r e l a t i n g

to

ther o j e c t .

I n a s m u c h

as

he

cos

of

a c q u i s i t i o n

o

he

oyal

Pam

was $

5

5

illion,

and

the

p r e v i o u s l y

a g r e e d

upon

r i c e

o

h e

S h o r e c r e s t ,

by

e e b l e s

is

aso$

5

5

i l l i o n ,

the

otal

acquisition

costs

would

be$1i l l i o n .

The

a d d i t i o n a l

costs

ove r $10

i l l i o n

w i l l

be

borne

by

P e e b l e s

and

not be

ao s t

b u r d e n

o

the

ity

o

he

RDA.It

has

e e n

mutually

a g r e e d

between

th e

RDA

and

Peebles

that

Pe e b le s

will

come

up

with

a n y

additional

c o s t s

over

he$

10 i l l ion

tha

relate

to


of

the h o r e c r e s t .

The

LO

c o v e r s ,

among

other

t h i n g s ,

the

e n t

tha

he

RDA

wll

eceive

from

the

e v e l o p e r , the

d e v e l o p e r '

s

m a n c i a l

involvement,

ou ts i de

f u n d i n g ,

q u e s t i o n s

of

sae

o

theh o t e l ,

p e r a t i o n s , quality

of

the

lag

p a r k i n g

anduse

of

the

RDA'sa r k i n g

garage.

The

O

f o l l o w s

the

basic

format

o

the

Loewg r e e m e n t e x c e p t

that

th e Loews

a g r e e m e n t

n e v e r

r e q u i r e d

s u b o r d i n a t i o n

o fthei g h t

to

e c e i v e

ren t

by

he C i ty.It

h o u l d

be

noted

that

th e

s i gn in g

o

h e

L O I is

ust

one

s tep

in

movng

f o r w a r d .

It

is

the

l u e p r i n t

for

the

e f i n i t i v e

a g r e e m e n t s .

If

he

next

d o c u m e n t s

to

be

g r e e d

upon

ae

u n a c c e p t a b l e ,

the LO I

s t a t e s

that

t h e r e

is

no

f u r t h e r

o b l i g a t i o n

on

t~

pat

o

the

Cty

RDA

u b j e c t

to

p o s s i b l e

des ign

d e v e l o p m e n t

e x p e n s e

r e i m b u r s e m e n t .

A N A L Y S I S :

Following

a r e

criteria

m a j o r p o i n t s

in

he

L O L Theo c u m e n t is

a t t a c h e d ,

ad

a

presentation

wll

be

m a d e

a

he

City C o m m i s s i o n l M i a m i

B e a c h


Agency

m ee t i n g .

D Room

count:

425

u n i t s total (

5 8

hotel

r o o m s l l6 7 hotel s u i t e s ) .

D

ease

t e r m :

1 0 0

years.

D

R e n t to

RDA: $

490

0 0

per

y e a r plus

i n c e n t i v e

ren

up

8/15/2019 264-97 RDA

5/48

o

M o rtg a g e b y

pr iva te

lenders: $

31

m i l l i o n . o

DA

owns both

s i t e s .

o

arking:

118

s p a c e s

on

i t e ,

1 5 3

spaces

to

be

rov i ded

in

D A - o w n e d

garage

at

16h

t r e e t .

o

o m m i t m e n t

of

room

lock

fo

C o n v e n t i o n

C e n t e r

usage.

o

ag:

Crowne

l a z a

franchise,

anagement

by

Hospitality

Partners.

o

o m p l e t i o n : p e r s o n a l l y

guaranteed

by

equity

partners.o

u a l i t y

s tandards

to

be

p p r o v e d

by

T i s h m a n

Hotel

Corporation.

oDesgn

e v e l o p m e n t

to

c o m m e n c e

with

LOl s i g n i n g

and

wth

a$

00

00

cap

on

r e i m b u r s e m e n t

should

the

d e a l

not

go

t h r o u g h

due

to

the

i t y '

s

i t h d r a w a l .

o

RDA

to approve

pans

and

p e c i f i c a t i o n s .

o e s t r i c t i v e

c o v e n a n t

l im i t ing

p r o p e r t y

to

o t e l

use

during

th e

life

o

th e

RDA.

o

adius r e s t r i c t i o n s . o

Rea l

e s t a t e

taxes

to

be

ad

by

deve loper .

o

Mandatory

p u r c h a s e

of

A g e n c y '

s

i n t e r e s t

in

th e

land

t 25th year.

oAMP'

s o

sma

q u a l i t y

o p e r a t o r

fo e s t a u r a n t .

C O N C L U S I O N :

The

it y

C o m m i s s i o n l R e d e v e l o p m e n t

A g e n c y s h o u l d

a p p r o v e

the

8/15/2019 264-97 RDA

6/48

RESOLUTION

NO.

9 7-

22316

AE S O L U T I O NOF

HE

M AYOR

AND

CITY

C O M M I S S I O N

OF

HE CTY

OF

MAM

BEACH

APPROVING,

AND A U T H O R I Z I N G

THE

M A Y O R

AND

IT Y

CLERK TO E X E C U T E ,

THE

A

T

C H E D

LETTER

ONTENT

B E T W E E N

THE

CTY

THE

MAMEACH


AGENCY,

RDP

ROYAL

PALMHOTELL I M I T E D

C O M P A N Y

AND

RDP

SHORE

CREST

HOTEL

LIMTED

O M P A N Y

REGARDING

THE

W N E R S H I P ,

DEVELOPMENT

AND

O P E R A T I O N

O

A

CONVENTION HOTEL.

W H E R E A S ,

RDP

Royal Pam

Hote

Limi ted

C o m p a n y (

RDP

Royal

Pam")

wa s s e l e c t e d

as

he

i n n i n g

bdder

in

response

to

Request

fo

P r o p o s a l s

N u m b e r

45

95

96 ("

RFP")

o

develop,

ownand

operae

an

f r i can-

A m e r i c a n

owned

c o n v e n t i o n

c e n t e r

hoe

in

i a m i

B e a c h ;

and

H E R E A S ,


of

the


Agency (

RDA"),

he

City

o

M i a m i

Beach (the "City"),

RDP

oyal

Pam

and

RDP

S h o r e c r e s t

Hotel

Limi ted C o m p a n y (

c o l l e c t i v e l y ,RDP

oyal

Pam

and

DP

Shorecrest H o t e l

L i m i t e d C o m p a n y

are

e f e r r e d

to

s

RDP")

a v e b e e n

engaged in

e g o t i a t i o n s

fo

a

u m b e r

o

o n t h s

regarding,

among

other

things,

he d e v e l o p m e n t ,

ownership

and

o p e r a t i o n

ohe

proposed

h o t e l ; an d

W H E R E A S , th e d e v e l o p m e n t

o

he

hotel

is

aart

of

and

is

cons i s t en t

wth

the

Cty

e n t e r

Hstoc

o n v e n t i o n

V i l l a g e R e d e v e l o p m e n t

and

e v i t a l i z a t i o n

Plan

and

w i l l

e l i m i n a t e

slum

and

bighin

the

Cty

e n t e r

Hstoric

o n v e n t i o n

V i l l a g e

R e d e v e l o p m e n t and

Revi ta l izat ion

A r e a ;

and

W H E R E A S , t h e


o

the

o te l

is

a

u b l i c

p u r p o s e

a n d

wll

ene f i t

the

public

by,

among

o t h e r

thngs

i n c r e a s i n g

the

number of

c o n v e n t i o n

q u a l i t y

hote

r o o m s

in

h e

Cty

ssisting

he

Cty

in

a t t r a c t i n g

conventions

a n d

i n c r e a s i I 1 g

the

t i l izat ion

o

theo n v e n t i o n

Center,

n c r e a s i n g

tourism

and

improving

the

economy;

n d

W H E R E A S ,

the

e v e l o p m e n t

oh e

h o t e l

as

e s c r i b e d in

the

a t t a c h e d l e t t e r

o

i n t e n t

LO")

su t h o r i z e d

by

hapter

163

o

the

l o r i d a

S t a t u t e s ;

and

W H E R E A S ,


o

the

RDA,

he

Ci ty

and

D P

s u b j e c t

to

he

a p p r o v a l

o

the

RDA

n d

the

i ty , h a v e

n e g o t i a t e d

the

erms

o

the

or a t t a c h e d

hereto.

NOW

H E R E F O R E ,

BE

IT

ULY

R E S O L V E D

BY

HE MAYOR

AND

CITY

C O M M I S S I O N

OF

HE

CTY

OF

MIAMI B E A C H

as

o l l o w s :

1

he

a t t a c h e d

Lor b e t w e e n

t h e

RDA,

the

City

and

DP

is

hereby

a p p r o v e d .

2

he

M a y o r

and

it y

C o m m i s s i o n

hereby

f i n d t h a t

the

evelopment

o

the

o t e l

is

u b l i c

p u r p o s e ,

will

b e n e f i t

the

p u b l i c ,

and

s

a

part

o

nd

is

c o n s i s t e n t

wth

he

Cty

en ter

8/15/2019 264-97 RDA

7/48

3

The

M a y o r

and

Cty

C o m m i s s i o n

h e r e b y

find

that

the

e v e l o p m e n t of

the

o t e l

is

a u t h o r i z e d

by

hapter

163

F l o r i d a

Statutes.

4

The

Mayor

and

Cty

l e r k

aeu t h o r i z e d

to

x e c u t e

the attached

LO.5

he

hief

N e g o t i a t o r ,

Cty

a n a g e r

and

Cty

ttorney,

and

ther

respective staffs

and

u t s i d e

consultants,

are

authorized

to

negotiate

and

o c u m e n t

the

d e f i n i t i v e

a g r e e m e n t s

r e l a t i n g to

he

LO

and

a k e

al

he

a c t i o n s

ino n n e c ti o n t h e r e w i t h .6

Ths

e s o l u t i o n

shal

takef fec t

immediately upon

adoption,

A S S E D

and

A D O P T E D

ths

A P P R O V E D

AS

TO

F O R M &

l A N G U A G E

FOR

e x e C U T I O N

T T E S T

RobtP~~ C I T Y L E R K AITIkw

f:\

a t t o \

taca\

8/15/2019 264-97 RDA

8/48

CITY HALL

1700O N V E N T I O N CENTER

DRIVE

MIAMI

BEACH

FLORIDA

3 3 1 3 9

CTY

O

MAM

BEACH

O M M I S S I O N

M O R

N O ,

I

50-

C

7

O:

MayorS e y m o u r

G e l b e r

and

Members

o

the

Cty

C o m m i s s i o n

DATE:

M a r c h

5,

1 9 9 7

FROM:

J o s e

Gaca-

pedroJ.J . .

Ctya n a g e r (

q

ESOLUTI~

A P P R O V I N G

A

LETTEROF

NTENT

A M O N G

THE

RDP

ROYAL

PALM

OTEL

LTD.

CO.

AND

DP

S H O R E C R E S T

HOTEL

LTD .

CO (

O L L E C T I V E L Y

RDP),

THE

CTY

OF

MAM

EACH

AND

THE

MAM

BEACH


AGENCY

OR

TH E

O W N E R S H IP ,

DE V E L O P M E NT

AND

PERATION

OF

AN

AFRICANAMERICAN

OWNED

HOTEL

AT

5 3 5

AND

1545

C O L L I N S A V E N U E .

SUBJECT: R E C O M M E N D A T I O N : A p p r o v e

the

e s o l u t i o n .

B A C K G R O U N D :

Staf f

and

o n s u l t a n t s

fo

he


Agency (

D A )

and

C o m m i s s i o n

have

e g o t i a t e d

ar o p o s e d

letter

o

inen (

O I ) (

a t t a c h e d

hereto)

for

a

25

r o o m hotel

c o m p r i s e d

of258 hotel r o o m s and

167

hotel

suites.

On

June

59 96 ,

the

RDA

se l e c t ed

the

D P

Royal

P a l m

HotelLd

o m p a n y , after

an

e x h a u s t i v e

pubic

r e v i e w

process,

o

negotiate the

e r m s u n d e r

wh i ch

RDP

would

d e v e l o p ,

own

nd o p e r a t e

a

onvention

hote

on

the

Royal

P a l m

property

and o p t i o n a l l y

on

he

adjacent

S h o r e c r e s t

p r o p e r t y .

At

the

time,

the

eveloper

h a d the

h o r e c r e s t

Hotel

under

contract

and

he

s u c c e s s f u l

p r o p o s a l

c o n t e m p l a t e d

d e v e l o p m e n to

o th sites

p e r a t e d

u n d e r

u n i f o r m m a n a g e m e n t . Thus,

the

Cty

ddot

have

s i t e

conro

on

al

o

he

land.

For

many

months,

the

Cty

se g o t i a t o r s

and

staff,

o r k i n g

in

a r m o n y

with

Don

eebles,

he

developer on

the

LO,

truggled

toput

the

deal

t o g e t h e r

unde

a

t r u c t u r e oftwo

separate

o w n e r s h i p s

oandorone

hotel

e v e l o p m e n t . Inthe

ast

two

weeks,

by

u n a n i m o u s

c o n s e n t ,

the

hief n e g o t i a t o r

for

the

RDA

and

M.

e e b l e s

came

to

a

o n c l u s i o n

thahe

singe-

ste

w n e r s h i p

w as preferable a n d Mr. eeb les

a g r e e d

to

ransfer

hs

ontract

in te r

in

8/15/2019 264-97 RDA

9/48

As

a

result

of

the

agreement,

the RDA

and

Peebles

moved

rapidly

to a

mutually

accep tab le

LO .

The LOI,before

the RDA

and

City

Commission,

therefore

con t em p l a t e s

com p l e t e

site

control in

the

hands of

the

RDA,

as

is

the

case

with

the

Loews

Hotel.

The

RDA

made a

commtment

to

all

RFP

respondents

that

its

funding

obligation

would

be

limited

to $ 10

i l l i o n . The

RD A

has

a g r e e d

to

u b o r d i n a t e

its

r i g h t

to

eceive

ren

under

certani r c u m s t a n c e s

to

the

first $

0

million

in

i n a n c i n g

r e l a t i n g

to

the

r o j e c t .

I n a s m u c h as

he

cos

of


o

he

Royal

Pam

was $

5

5

illion,

andthe

p r e v i o u s l y

a g r e e d

upon

p r i c e

o

h e

S h o r e c r e s t ,

by

e e b l e sis

aso$

5

5

i l l i o n ,

the

otal

acquisition

costs

would

be$1

i l l i o n .

The

a d d i t i o n a l

costs

ove r $

10i l l i o n

w i l l

be

borne

by

P e e b l e s

and

not

beao s t

b u r d e n

o

theCty

o

he

RDA.

It

hase e n

mutually a g r e e d

between

the

RDA

and

Peeblesthat Peebles will

come

up

wthn y

additional

c o s t s over

he$

10i llion

tha

relate

to


of

the h o r e c r e s t .

The

LO

c o v e r s ,

among other

t h i n g s ,

the

e n t

tha

he

RDAwll

eceive

from

the

e v e l o p e r , the

d e v e l o p e r 's

i n a n c i a l

involvement,

outs ide

f u n d i n g ,

q u e s t i o n s

ofsae

o

theh o t e l , p e r a t i o n s ,

quality

o f

the

lag

p a r k i n g anduseof

theRDA'sa r k i n g

garage,

The

LO

f o l l o w s

the

basic

format

o

the

Loewg r e e m e n t

e x c e p t

that

the

Loews a g r e e m e n t

n e v e r

r e q u i r e d


o f thei g h ttoe c e i v e

r e n t

by

he

City,

It

s h o u l d

be

n o t e d

t h a t

the

igning

o f t h e

L O I is

ust

o ne s tep

in

movng

f o r w a r d .Itis

the

l u e p r i n t for

the

e f i n i t i v e

a g r e e m e n t s .

If

he

next

d o c u m e n t s

tobeg r e e d

upon ae

u n a c c e p t a b l e ,

the LOI

s t a t e s

t h a t

t h e r e

is

no

further

o b l i g a t i o n

on

he

pat

o

the

Cty

RDA

u b j e c t

to

p o s s i b l e

des i gn


e x p e n s e

r e i m b u r s e m e n t .

N A L Y S I S :

Following

a r e

criteria major

p o i n t s

in

he

LO .

The

o c u m e n t

is

a t t a c h e d ,

ad

a

presentationwll

be

m a d e

a

he

City

C o m m i s s i o n l M i a m i B e a c h


Agency

mee t i n g .

o

Room

count:

425

u n i t s

total (

5 8

hotel

r o o m s l 1 6 7

hotel

s u i t e s ) .

oease

t e r m :

1 0 0

y e a r s .o

R e n t

to

RDA: $

490

0 0 per

y e a r plus i n c e n t i v e

ren

up

to $

2000 0 per

year.

o

8/15/2019 264-97 RDA

10/48

o

RDAowns

both

sites,

o

Park ing :

118

p a c e s

on

ste

5 3 s p a c e s

to

e provided

in

RDA-

w n e d

g a r a g ea

1 6 t h

Sree.

o

o m m i t m e n t

o

o o m

bock

fo

C o n v e n t i o n

C e n t e r

u s a g e .

olag:Crowne

Pazar a n c h i s e ,

managemen t

by

H o s p i t a l i t y

Partners.o

omp le t i on : e r s o n a l l y

g u a r a n t e e d

by

e q u i t y

par tners .

o

u a l i t y s t a n d a r d s

to

e

approvedby

Tishman

H o t e l

C o r p o r a t i o n .

o

e s i g n development to

o m m e n c e

wth

LOl

signing

a nd

with

a$

600

00

apon

e i m b u r s e m e n t

s h o u l d

the

eal

no t

go

t h r o u g h

d u e

to

th e

City'

s

wi thd rawa l .

o

DA

to

a p p r o v e

pansand

s p e c i f i c a t i o n s .o

e s t r i c t i v e c o v e n a n t l imi t ing

p r o p e r t y

to

hotel

u s e

d u r i n g

the

l i f e

o

the

R D A .

oadius

r e s t r i c t i o n s . o e a l

e s t a t e t a x e sto

b e

pad

by

e v e l o p e r .

o

a n d a t o r y purchase

of

A g e n c y '

s

n t e r e s t in

the

l a n d

a

5t h year.o

HAMP'

s

r

sma

quay

o p e r a t o r

for

r e s t a u r a n t .C O N C L U S I O N :

The

Cty

Commiss ion/


Agency

s h o u l d

a p p r o v e

the

8/15/2019 264-97 RDA

11/48

LETT E R

o

F I N TEN

T

Subject: Royal

Palm/

Shorecest Cowne

PazaHote

Parties:

RDP

Royal

Palm

Hote

Lmted

Company

and

RDP

Shorecest Hote Lmted

Company

colecivey "

RDP")

City

of Miami

Beach ( the "

City")

MamBeach

Redevelopment

Agency

the "

Agency")

Dae:

March

5

9 9 7

R E C I T A T I O N S :

A

n

F e b r u a r y

1993

the

Cty

Center/

Hstoic

C o n v e n t i o n

Vage

e d e v e l o p m e n t and

Revitalization

Aea

w a s

o f f i c i a l l y

established

by

th e

adopon

o

a

Redevelopment

Pan(

the

Redevelopment

Pan").The R e d e v e l o p m e n t Panas

theresuto

he

c o m b i n e d

ef fo r t s

of

the

Cty

o

Miami

Beach (

he"

ty"),

the

am

Beach


Aency (

he"

Agency"),

e t r o p o l i t a n

Dade

County

and

the

tate

o

lorida.

The

R e d e v e l o p m e n t Pane p r e s e n t s

the

f f o r t and

commi tment

ohe

Agency

and

the

ity

to

o s t e r

the

deve lopment

o

convention quaty

hote ls,

ancllay

i m p r o v e m e n t s

and

acilities,

and n e c e s s a r y linkages to

the

am

Beach

Convenon

Cener (

heo n v e n t i o n

Center " ) .

Pursuan

to

he


Plan,

the

gency

has

acqu i red

the

Roya

Palm

H o t e l

whch

has

stree

addresso

545

Collins

A v e n u e ,

Miami

B e a c h , Florida

and

h i c hitas

greed tomake

availablefo

a

onvention

ho t e l w h i c h

wll

s e r v e

as

a

art

of the


Plan.

B

The

Cty

and

the

g e n c y aso

h a v e

decded

to

a k e

a

u b s t a n t i a l

commitment

to

provde

the

f r i c a n -

Amercan

o m m u n i t y

with

a

pportunity

in

the

hospitality industry.

In

o n n e c t i o n

wth

hat

c o m m i t m e n t ,

the Agency

has

g reed

to

ake

available

the

Roya

Pam

Hoe

and

a d d i t i o n a l

fnanca

incentives

foan

A f r i c a n -

A m e r i c a n owned

otel.

C

In

u r t h e r a n c e

o

heRedevelopment

P lan and

the

ommtment

to

he

f r i c a n - A m e r i c a n

c o m m u n i t y

referred

to

n

the

receding

paragraph,

the

Agency

published

Request

fo

8/15/2019 264-97 RDA

12/48

9596 (

the " RFP,

enti t led "

Cty

Cene

Hstoic

Conven t i on

Vage

e d e v e l o p m e n tande v i t a l i z a t i o n

Aea

ArcanAmerican

Hoe

Development

Opportunity", daed

D e c e m b e r

27995

and

amended

onanuary

2

996,

January

3996 and

Mach

5

1996

he R F P soughbdsfo

the

development

and

o p e r a t i o n

o

a

onvent ion

h o t e l

owned

by

African

A m e r i c a n s .

D

O

une

5

996,

after

a

pubic

review

process,

the

Agency

seected

RDPRoya

Pam

oteLmted

Company(

w h i c h , aong

wth RDP

S h o r e c r e s t

Hotel

Limited

C o m p a n y

sha

h e r e i n a f t e r collectively

beeferred

to

as "

DP")

from among

the

r o u p s that

submitted

p r o p o s a l s

pursuant

to

heFPand

irected r e p r e s e n t a t i v e s

o

he

Agency

to

e g o t i a t ethe

erms

unde

w h i c h RDP w o u l d develop,

ow n

and

pe ra t e

the

convention

h o t e l

r e f e r r e d

to

above ( he

otel")

inc c o r d a n c e

wth

he

e q u i r e m e n t s of

the

FP. Ths

ete

sets foth

the

u n d e r s t a n d i n g r eached

a

esult

o

u c h

negotiations.

1.

TH E

HOTEL:

The

Hotel

wll

consist

of thefollowing: (i)

e s t o r e d

portions

othe

Royal

P a l m

Hotel,

and

aew

ow e r

to

e

d e v e l o p e d

to

the

eas

of

the

Royal

Pam

Hotel,

as

pethe

pans

and specifications

a p p r o v e d by

the

oint

Desgn

eview

and

Hstoric

r e s e r v a t i o n

Boards

on

ecember

3

996,a

sad

plans

andpec i f i ca t i ons

my

be

mended

and

a p p r o v e d ,

t o g e t h e r

c o m p r i s i n g

a p p r o x i m a t e l y two

h u n d r e d

fifty

gh (

58) hotel room

here ina f te r col lectively

r e f e r r e d

to

ahe

P

Hoe")and

ii)

restored portions

o

h e

S h o r e c r e s t Hote

w h i c h has

a

t r e e t

a d d r e s s

o

5 3 5

Coll ins

Avenue

Miami

B e a c h ,

Florida

and

a

ew

owe

toe

d e v e l o p e d

to

he

ast

o

the

horecrest

Hoe,

as

pe

the

plans

and

s p e c i f i c a t i o n s

approved

by

he jon

Design

Revew

and

storic

Preservation

Boards

on

D e c e m b e r

3

996,as

sad

ans

and

p e c i f i c a t i o n s

may

beamended

and

a p p r o v e d ,

togehe

compr is ing

a p p r o x i m a t e l y one

hundred

s i x t y -

seven(

67)

hotel

s u i t e s ( hereinaf ter

c o l l e c t i v e l y

r e f e r r e dto

she"h o r e c r e s t

H o t e l ) . T h e

Shorecrest Hote

wllbe

pera ted

in

onjunctionwth

the

RPote

as

the

oe.

The

otelwll

be

airs

cass,

upscale

p r o p e r t y

wth

sutabe

o n v e n t i o n , confe rence

an d m e e t in g

space

and

p p r o p r i a t e

amntes

meetng

the standards

of

the

rowne

Plaza

chain

andhose

t a n d a r d s

se

f o r t h

in

he Ground

Lease ( as

h e r e i n a f t e r

defined).

It

wll e

eveloped

b a s e d uponthe

c o n c e p t presented

in

RDP

s

e s p o n s e

to

the

RFP,

daed

April

1

1996

ubject

to

he

def in i t ive a g r e e m e n t s

to

e

entered

inoe t w e e n

the

g e n c y

and or the

ity (

as

applicable)

and

RDP

c o l l e c t i v e l y ,

the "

greements") ,

the

fom

nd

substance

o

whch

shal

be

a c c e p t a b l e

to

RDP

sende

DP,

the

Agency

and

he

City.

RDP

hal

be

bligated

to

eve lop,

design

construct,

f u r n i s h and

equp

the

Hotel in

ccordance

with

pans

s t a b l i s h e d pursuan

to

he

Agreements

which

sha

ncude

p p r o x i m a t e l y

8/15/2019 264-97 RDA

13/48

envronmena,

safety

and

other

governmental

law,

rues and

regulations.

2

O S T S OFTHE

HOTEL:

The

reliminary

estimated

budge t

fo

the

e v e l o p m e n t

o

theo t e l

is

a

follows: 2.1

Uses

ounds.

Lando n s t r u c t i o n

Cos

ndirect

Fees I n d i r e c t

Coss

FF&

E

eneral &

Admin.

F i n a n c i n g

Costs

Sa-

U

Costs

Construction

Interest

Fee

o n t i n g e n c y

Total3

FUNDING

OF THE

HOTEL3

1 Sources

o f Funds.

D e v e l o p e r

Equty

C

Barker

D

e e b l e s

J

Thompson

HCF

r o u p F F &E

Loan

ontingency

C r o w n e

F F &

E

oan

Hospitality

Partners

FF&

E

o n t i n g e n c y

LoanDonohoe

Loan

artner

Contingency

Loan

Workng

Capta

Revovng

Loan

Deferred

Construcion

Management &

e v e l o p m e n t

Management

Fees

Deferred

C o n s t r u c t i o n

M a n a g e m e n t

Fees

Deferred

Deve lopment

Management

Fees

Frs

Mortgage

Loan

ge n cy

8/15/2019 264-97 RDA

14/48

3

rovider and

Fom

o

o m p l e t i o n Guaran tee .

T h e Cass

A

embers (

the

uaranors

d e f i n e d

h e r e i n b e l o w )o

RDP

sha

provde

personal

g u a r a n t e e s

r u n n i n g

to

he

City

and

the

gency

whch

wll

irrevocably

and

n c o n d i t i o n a l l y

guaranee

the

u c c e s s f u l

comp l e t i o n

an d

o p e n i n g

o

the

Hoe.These

ersonal

g u a r a n t e e s

shall

be

jon

nd

several

and

sha

be

p r o v i d e d

by

R

onahue

Peebles,

Cecle

Barker,

Jeffrey

Eal

Thompson ,

Peter

Calin

and

HCF

nc (

colecivey

the

u a r a n t o r s ) .

From the

dae

f

e x e c u t i o n

o

the

g r e e m e n t s

unl

the

Openng

Date,

Guarantors

sha

furnsh

updaed

i n a n c i a l

s t a t e m e n t s

to

he

City

and

the

gency

a n n u a l l y

and

any

aterial

a d v e r s e

c h a n g e

in

he

aggregate

f i n a n c i a l

c o n d i t i o n

o

he

u a r a n t o r s ,

ncudng

as

r e f l e c t e d

in

he

s t a t e m e n t s

or

any

o

hem

hich

c h a n g e

has

a

material

a d v e r s e effect

on

he

comp le t i on

or

o p e n i n g

o

the

o t e l ,

sha

be deemed

a

efaul t

unde

the

g r e e m e n t s .

3

Fundinq

o

Aqency'

s

Share.

The

Agency

s

ota l

f und i ng

obligation

sha

be

en

mllion

doas($

10

00

000)

allocated

as

folow:

Shorecrest

Hoe

Land

5

00,

000

4

00,

000

10

000

000

P

Hoe

and

4

UNCPAL

G A R A G E :

4

A q e n c y

o

ity

to

uld

G a r a q e .

The

g e n c y

or

Cty

shall

be

respons ib le

fo

he

cons t r uc t i on

and

m a i n t e n a n c e (

fo

so

long

as

he

Hotel

is

operated

as

a

o t e l

o

he

arking

s p a c e s

are

required

fo

he

use

o

such

hoe

by

RDP

nder

applicable

aw

o

u n i c i p a l

g a r a g e (

Garage")

on

an

g e n c y -

o w n e d

site

within

an

ea

o u n d e d

by

ashington

and

Cons

Avenues

b e t w e e n

15h

nd

17h

S t r e e t s .

The

Agency

and/

o

he

City

shall

perform

the

o r e g o i n g

actions

in

c c o r d a n c e

wth

the

s t a n d a r d s

se

forth

in

he

greements.

Th e

Agency

and

or

the

Cty

nticipates

the

Garage

wll

be

o p e n

by

the

pen i n g

Date (

d e f i n e d

h e r e i n b e l o w ) ;

however,

if

he

a r a g e

is

not

s u b s t a n t i a l l y

comp le t ed

and

ready

fo

se

by

the

pening

Dae

hen

in

h a t

even,

he

A g e n c y

and

o

the

Cty

shall

make

one

hundred

fifty

hree (

153)

parking

spaces

a v a i l a b l e

elsewhere

w i t h i n

a

adus

o

one

t h o u s a n d

two

h u n d r e d (

1

00)

feet

o

the

o t e l (

Temporary

P a r k i n g )

for

the

oe

unt i l

the

Garage

is

u b s t a n t i a l l y

completed

and

ready

fo

use

he

Agency

o

he

Cty

sha

be

e s p o n s i b l e

fo

he

additional

expenses,

if

any

elated

8/15/2019 264-97 RDA

15/48

defined below)

by

the Hote

in

the

Garage (

including

provisions

for Hote

vaet

parking arrangements).

Hote

use

parking

raesshal be estabished

by

the

garage

operator,

subject

tothe

Agency'

s o the

City'

s

approval, provided,

however,

charges

to

RDP for vaet

parking

shal not exceed

fifty (

50%

e r c e n t

o

the

sef-

park rate

and

h a r g e s

fo

Hoe

employee

parking shallno

xceed the

o w e r

of (i)

theonthly

parking

rate, (

ii)

ifty(

0%)ercent o

the

ef-

a r k i n g rate o (iii)

the

ontract parking rae

RDP

shall ulze

thevailable

p a r k i n g spaces

a

he

a r a g e

po

tot i l i z i n g

other

of-

ste

arking

facilities.

The

Agency

o

he

Cy

as

appicabe,

shall

incorporate

the

provisions

o

hs

subparagraph

4

and

s u b p a r a g r a p h

4

3

e r e i n b e l o w

in

ny

nd

al

operation

and

a n a g e m e n t

a g r e e m e n t s

wth

garage

o p e r a t o r s

reaing

tohearage.

4

3

prioritv

Use "

riority use"

shal

m e a n

thearage

ope ra to r sha set

aside

soey

fo

otel

use such

number

o

the

allocated

parking s p a c e s

as

Hotel

O p e r a t o r shall request

from

time

to

time

upon

ot less

than

weny-

four (

24

ours

prior notice

to

thearage

operator.

4

ote l

Garaqe

Ren.

RDP

shal

pay

nnua

ren,

ayabe

m o n t h ly ,

equal

to

ne h u n d r e d

thrtyseven

t h o u s a n d se v e n

hundred

d o l l a r s ( $

137

00) fothe

seo

the

p a r k i n g

spaces

in

he

Garage

as

described

inths

Lete

of nen,u b j e c t

to

u b p a r a g r a p h

4

ereinbelow (

the "

Garage

Re n t " ) .

4

5acilitv

U s a q e

P a v m e n t .

In

o n s i d e r a t i o n

o

D P 's

greement

to

lze

he

Garage,

as

r o v i d e d

above

RDP

sha

bead

m o n t h l y

a e r c e n t a g e

o

the

annua

g r o s s r e v e n u e s

o

the

Gaage

as

olow (

the "

Facility

Usage

Paymen t " ) :

i)

l even

and

ou

enhs

p e r c e n t (

11

4%

the

annual

g r o s s

r e v e n u e s

wth

respect

to

the

firs

one

mon

woundred

thousand

dollars ($

1200

000

o

gross

revenues;

and

ii)even

and

sx

enhs

percen (

7

6

those

annual

gross

revenues

that

exceed

o n e

mon

wo

hundred

thousand

doas($

100,

000;

r o v i d e d , h o w e v e r ,

the

firs

ne

hundred

thrty

seven

thousand

seven

u n d r e d

dolars ($

137,

700)

resulting

from

the

a p p l i c a t i o n

o


4

5(

i

e r e i n a b o v e

to

nnual

g r o s s

r e v e n u e s

shall

be

applied

as

a

r e d i t

against

th e

Garage R e n t

each

yea.

4

6

i m i t a t i o n

8/15/2019 264-97 RDA

16/48

Temporary parking

less thecumuave

Faclity

Usage

Payments

receved

by

RDP from

thedaeof such

commencement exceed

the

sumof

two

hundred

seventy-

five thousanddollars ($

275,

000

heFaclity

Usage Paymen t

fo

hat

year wll

be

the

greater

o

one

undred thrty-

even

thousand seven

h u n d r e d

dol lars 137700

n d

the

mount

cacuated

in

accordance

wth

ubparagraph

4

e r e i n a b o v e .

4

7 Enforceability.

A p p r o p r i a t e

provsions

wlle

made

by

recorded,

non-

excusve

a s e m e n t oother c o v e n a n t ,

to

n s u r e

the

e n f o r c e a b i l i t y

ohe

Hotel's

ighs

to

he

Garage.

5

R O U N D

LEASEThe

and

o m p r i s i n g

the

RP

o t e l and

the

Shorecrest Ho te l

collectively,

the " Land"),hch

isore

f u l l y

d e s c r i b e d

onxhibit

A

a t tached

hereto

and

made

a

art

hereof

as

if

f u l l y

set

foth

erein,

wll

be

l e a s e d

to

DP

by

the

g e n c y

or

the

ty

as

applicable, (

he"

Lessor")

u r s u a n t

to

a

round lease (he

r o u n d

Lease " )

havng

he

f o l l o w i n g p r o v i s i o n s : 5

1

tle.

The

exec u t i o n of the A g r e e m e n t s

byDP

wll

be

conditioned

upon

fee

title

to

theand

e i n g

good,

marketable

and

nsurable subject

ony

o matters

reasonably

a c c e p t a b l e

to

RDPi

provded,

however,

hat the Lesso

iso

r e s p o n s i b l e

fo

i

tIeatters

pertaining tohe S h o r e c r e s t Hotel land

tha

ffect

on c u m b e r

that

andas o

he

dae

f

a s s i g n m e n t

rom

DP

to

he

Lessor

o

esso

sffiliate

o

ny c o n t r a c t

to

u r c h a s e

that

and

Ate

e x e c u t i o n o

he

g r e e m e n t s and

theecord ing

ohe

G r o u n d

Lease,

the

essor

wll

ot further

encumber

such

title

to

he

and

except

wth

espec

to

those

matters (

such

s

utility

e a s e m e n t s ando n -

m o n e t a r y

reciprocal

easement a g r e e m e n t s )

reasonably

a p p r o v e d

by

DP

and

which

dono

d v e r s e l y affec

the

operat ion o

e v e l o p m e n t

ohe Hotel as cal led

for

h e r e i n .

Theand

wllbee a s e d

toDP

on

an

as

is

asisa

the

time

o

x e c u t i o n

o

the

G r o u n d

Lea s e .

5 erm.

On e

h u n d r e d (

100

e a r s .

5

3ase

Ren.

DP

shal

pay

to

he

Lessor

base

ren

in the

amount

o $

220

000

00per

year, payable

m o n t h l y ( hea s e

Rent ),

commencing

on

the

opening date

o

he Hotel (the

O p e n i n g

Date").

TheBase

Ren

shalbe

increased

athe

e g i n n i n g

o

the

tenh(

10h),

ifteenh(

15h)

and

t w e n t i e t h 20h)years

from

the

pen i n g

Date

based

upon

he

increase

inhe

GDP

implicit

price

deflator index.In

no

vent

shall

the

as e Rent during any

period

be

ess

than

the

Base Ren

dung

anyprior pe r i od .

5

Addtiona

Rent.

8/15/2019 264-97 RDA

17/48

270,000

00pe

ear,

payabemonthly (

he

d d i t i o n a l Rent ),

commenc ing

onheOpenng

Dae.

The

d d i t i o n a l

Ren

hall

be

increased

at the beginning othe

t e n t h (

the),

fifteenh

15th)

and

went ie th ( 20th)

years

from

the

Open ing

Date

based

p o n the i n c r e a s e

inhe

GDP

mplicit

price

d e f l a t o r

index.

In

o

even

shal

the

d d i t i o n a l

Ren

d u r i n g

any

period

be

ess

han

the

d d i t i o n a l

Rent

during

any

rior

p e r i o d .

5

n c e n t i v e

Ren.

In

d d i t i o n to

the

ase

Rent

and

the

A d d i t i o n a l

Rent, RDP shalaso

pay

to

he

Lessor

incentive

r e n t

equalto

w e n t y (

20%

percent

o

tha

mount

o

the

n n u a l

gross

revenues

from

the

peration

ohe

Hoe

tha

xceeds

s e v e n t e e n

million

nne

undred t h o u s a n d

dollars

17

900,

000)

pe

ear,

p a y a b l e

thrty(

30ays after

year-

end ( the "

ncentiveRen").

The

I n c e n t i v e

Rent

sha

be

apped

a

two

undred

thousand

dollars ($

200000

pe

year;

prov ided,

however, that

any Incentive

Ren

ove

wo

hundred

thousand

doas($

00,

000

per

year sha

not

b e

carried

forward.

5

u b o r d i n a t i o n

o

e n t a l

P a y m e n t s . 56

1

S u b o r d i n a t i o n

oRen.

In

hev e n t

o

defaut,

rena

a y m e n t s

to

bemde

by

RDP

to

he

Lessor

unde

the

G r o u n d

Lease

shall

beubord ina ted ,

asr o v i d e d

h e r e i n b e l o w ,

ony

o

d e b t

service

on

hefirs

ten

i l l i o n dolars ($

10

00

000) o

a

hirty one million

dollar

31

00

00) loan (

he"

o a n ) . N o t w i t h s t a n d i n g any th ing

to

the

o n t r a r y ,

theforesaid

s u b o r d i n a t i o n orena

p a y m e n t s

shall

no,

an d

does

ot,

mean

hat

theproprietary

inerest

of

the

A g e n c y in

the Land

is

s u b o r d i n a t e

to

nything,

i n c l u d i n g

bu

no

l i m i t e d

to

he

Loan

is

n c u m b e r e d

o

subject

to

beng

extinguished.

5

6efault

bv

RDP.

AIn

thev e n t o

deaut

unde

the

Ground

Lease

by

RDP,

the

e s s o r

sha

h a v e

th e r ight

to

mong

o t h e r

r e m e d i e s ,

terminate

the

round Lease

subject

to

the

Lender

s(

efined

in


5

9

2

ereinbelow)

cure

rights

a

et

forth

h e r e i n b e l o w

in

ubparagraph

5

2

B

In

he

even

o

a

e f a u l t

unde

the

Ground

Lease

by

RDP

Lender

shal

have

the

righ

to

m o n g ohe

remedies,

cure

any

m o n e t a r y

and/

or

non

onetary

d e f a u l t s whn

ime

peods

to

8/15/2019 264-97 RDA

18/48

Lessor

may

not

termnate

the

Ground Lease.

While

prosecuting

the

forecosue

acion

as

dscussed above, Lender

is

required

to

make

RDP's

monthly

rena

payments

only

to

the

exten

suficen

funds

ae

receved

by

Lender

from

operating

income

from

the Hote ate

deducting

a

sum

equal

toheamoun

necessary

to

pay

monthly

debt

servce

on

the

Loan

wth

regard

toa

principal

amoun of ten

mllion

dollars ($

10

000,

000,

e ss

the

moun t

of pr inc ipa l

paid

to

dae

a n d

o p e r a t i n g

e x p e n s e s .Cn

h e even

o

a

defaut

under

theortgage,

theround L e a s e

shall

no

e

in

e f a u l t

s o

ong

as(

i)

ender gves

thee s s o r

written noice

oad

d e f au l t

wthn

en1

ays

af ter Lender b e c o m e s

a w a r e

o

same;

and(

ii)

heGound

e a s e

is

n o t

otherwise

inefaut.

D

hroughout this

Leter

of

Inen,

or

purposes

of

calculating

the

mount

o principal o u t s t a n d i n g

unde

the

first

ten mllion d o l l a r s ( $

10

000

000

othe

oan

to

w h i c h

ren

ayments

are

s u b o r d i n a t e , the

app l i ca t i on of

p r o c e e d s

f r o m

the

ae

o

e a s eoamp's

e s t a u r a n t

shalno

be included

and

the

en

mon

ollars ($

10,

000

00)

towhch

ren

a y m e n t s are

subord ina te

shal

be

assumd

to

e

reduced,

o m m e n c i n g

on th e

Opening

Date,

by

m o r t i z a t i o n

on

a

ortgage

basis

on

a

wenty-

fve(

5)

yea

tema

thenterest

rate

o

he

oan.

5 6

enderAs

enant

U n d e r

the

Ground

L e a s e .I

ender

b e c o m e s

the

e n a n t

u n d e r

the Ground

Lease,

hen

in

tha

vent:

A

ende r

sha

be

b l i g a t e d

to

ay the

Lessor

al

urrent

rena

a y m e n t s due

under

the

Ground

Lease

and

omply

with

alohe

c o v e n a n t s

and

conditions

of

the

round

Lease

d u r i n g

the per iod

Lender

is

he

enan t .

B

he

amoun

o

unpad

ren

existing

as

othe

ime

Lender

b e c o m e s

the

tenan (

the

e i n s t a t e m e n t Dae") ,

n c l u d i n g accrued

inerest (

ahe

defaut

rae

p e c i f i e d

in

he

Mortgage),

t t o r n e y s '

8/15/2019 264-97 RDA

19/48

the "Back Ren"), shal

be

due and

payable

by

Lender toheLessor as folows:

i)

During

the

period

in

whch

any

part

of

the first ten

mllion

dollars ($ 10,

000

00)

in

rincipal

is

outstanding

under

the

original

oanhe

Agency

shalbe

pad

ac k

Rent

monthly

to

he

exten

funds

ae

vailable

from

p e r a t i n g

income

from

the

o t e l after

deduct ing

aum

equalto

he debt

service

on

the

oa n w i t h

regard

to

a

r i n c i p a l a m oun t

equa

to

ten

mi l l i on

dollars

10, 000,

000

esshe

p r i n c i p a l o

the

Loan

acualy

pad

toae

and

o p e r a t i n g

e x p e n s e s

whch

i n c l u d e s current

rent)

o

heHoe.

ii)

te

theirst

ten

mllion

d o l l a r s

10

00,

000 (

i n c l u d i n g

p a y m e n t s

prio

to

defaut)

n

princpa

has

been

pad

to

ender,

the

Lender

s

b l i ga t ions

to

pay

Back

Rent under

the

G r o u n d

Lease

sha

be

s u b j e c t

ony

to

the

paymen t

o

perating expenses

ona

on th ly

bass.

iii)

Back

R e n t

wll

con t inue

to

accrue wth

n t e r e s t

unl

paid

in ful.

5

6

4

al eo

he

Hoe

bv

L e n d e r .

Upon

a

ale

o

the

o t e l (

as

described

ina r a g r a p h1

e r e i n a b o v e )

by

Lender,

the net

sae

roceeds,

to the

extent

same

are

avalabe,

shal

be

applied

in

he

following

oder:

i)

to

repay

Lender

fo

m o u n t s

owed

on

he

frsten

mllion

d o l la r s ( $ 10,

000

000)

inr i n c i p a l

ess

r inc ipa l

paid

to

ae

pus

al

a c c r u e d

i n t e r e s t

thereon;

ii)

orepay

the

essor

for

amounts

owed

in

onnection

wth

Back

Ren

iii)

to

r e p a y

Lender

for a m o u n t s

c o n n e c t i o n

wth

ny

remaining

princpa a c c r u e d

interest,

costs

and

e x p e n s e s ;

o w e d

plus

in

al

v)

to

ay Lessor

al

accrued

inerest

on

Back

Ren;

a n d

v

o

ay

to

Lessor

the a m o u n t

of

the

Puchase

Price (

defined

in

subparagraph

5

01

hereinbelow).

A

he

em

et

8/15/2019 264-97 RDA

20/48

an uneaed

thrd

party,

the

amoun

of

the

selling price

minus

brokerage

commssons, taxand other

prorations

and

al reasonabe

and

customary

closing

costs.

B.

The new

amoun

towhch

the

Lessor'

s

inerest

in

the

rena

payments

under

the

Ground

Lease shal

be

subordnae

after

the sae

of the

Hote

by

Lender

shal

neve exceed

the

baance on

the

original

first ten

mllion

dollar ($

10

00

000

subordinated

a m o u n t

ater

deducting

al

r i n c i p a l

payments

r e c e i v e d

by Lende r up

o the time

o

he

sae5.

5

e f i n a n c i n q

Not

Related

to

a

eaut.

he

ne

r o c e e d s f r o m any

r e f i n a n c i n g

not

related

to

a

e f a u l t

by

RDP

shal

b e a p p l i e d

in

the

f o l l o w i n g order:

i

o

the

City

o

the

Agency

as

p p l i c a b l e ,to

ay

the

Purchase

P r i c e (

as

e f i n e d

in

u b p a r a g r a p h 510

h e r e i n b e l o w )

to

b u y o u t

the

gency

s

othe

City'

s

as

a p p l i c a b l e , i n t e r e s t

in

heand;

and

ii)

toDP

if

ny

funds

are

remaining.

A.

The

ew

a m o u n t

to

whch

the

essor '

s

nterest

inhe

rena

ayments

unde

the

ound

Lease

shall

be

s u b o r d i n a t e after

refinancing

shal

never

exceedthe

baance

on

he

origna

first

ten

llion

dola

10,

000

000

u b o r d i n a t e d

amount

after d e d u c t i n g

al

princpa

p a y m e n t s

r e c e i v e d

by

e nd e r

prio

tothe

im e o

the

e f inanc ing .

B

he

term"

ne

proceeds"

as

used

in

his

subparagraph

5

6

hal

mean

the

new

oan

amoun

ate

efnancng

mnus

the

outstanding

oan

ba l an c e

and

nterest

owing

before


m i n u s

r e a s o n a b l e

refinancing

t r a n s a c t i o n

expenses

and

r o k e r a g e

c o m m i s s i o n s .

5

7

ea

s ta te

Taxes.

RDP

h a l l

pay

al

ad

valorem

rea

esae

a x e s

and

ersonal

p r o p e r t y

taxes c o n c e r n i n g

the

Hoe

l e v i e d by

the

it y

and

other

governmental

a u t h o r i t i e s

in

c c o r d a n c e

wth

law.

RDP

wll

be

ent i t l ed

8/15/2019 264-97 RDA

21/48

avalabe,

under

applicable

law,

as

ifit

were the

fee

owner

of

the and.

5

8

E n v i r o n m e n t a l

Indemnitv.

5

8

1

he Agency

o

the

ty

as

e s s o r ,

a

p p l i c a b l e ,

wll

provde

an

n d e m n i t y

to

DP,

reasonably

s a t i s f a c t o r y

toRDP

ith

respect

to

the

remediation,

as

descrbed

in

the

g r e e m e n t s ,

o

n v i r o n m e n t a l m a t te r s

afectng

the

and

and

the

m p r o v e m e n t s

thereon

whch

xist

prior

to

he

e x e c u t i o n

o

the

r o u n d

Lease

5

8

2

RDP

will

p r o v i d e

an

ndemnity

to

he Agency

a n d /

o

the

Cty,

e a s o n a b l y

s a t i s f a c t o r y

to

oth

o

h e m ,

with

respec

to

the

emediation,

a

e s c r i b e d

in

the

A g r e e m e n t s ,

o

nvironmental

matters

a f fec t i ng the

Land

and

the

m p r o v e m e n t s t h e r e o n

arising

from

and

ate

he

execution

o

the

Ground

Lease.

5

8

3

limitations

o

liablity

wll

p p l y

with

respect

to

the

f o r ego i n g

i n d e m n i t i e s .

5

9

inancinq.

Any

f i n a n c i n g

secured

by

the

Gound

ease

o

o t e l ,

and

any

e f i n a n c i n g s thereof,

wll

be

p r o v i d e d

by

an

i n s t i t u t i o n a l lender

subec

to

he

p p r o v a l

o

the

g e n c y and/

o

he Cty

5

9

he

t e r m

i ns t i tu t iona l

lender"

means

a

erson

which,

a

he

time

it

ecomes

an

nstituiona

lender,

isa

stae

o

f e d e r a l l y

chartered

savings

bank

a v i n g s

and

oan

association,

credit

unon

o m m e r c i a l

b a n k

or

rus

o m p a n y

o

o r e i g n

b a n k i n g

institution (

in

ach

case

whether

actng

n d i v i d u a l l y

o

n

a

i duc ia ry

or

r e p r e s e n t a t iv e (

such

as

n

a g e n c y )

capacity);

an

n s u r a n c e

c o m p a n y

organized

and

exsting

u n d e r

the

law

o

he

Unted

t a t e s

or a ny

stae

h e r e o f

o

o r e i g n

i n s u r a n c e

company (

in

each

case

hether

acting

i n d i v i d u a l l y

or

in

i d uc i a r y

o

epresentative (

such

as

an

gency)

capacity);

an

i n s t i t u t i o n a l

investor

such

as

a

ubicy

hed

real

estate

investment

trust,

an

ntity

that

qualifies

a

a

E M I C

under

the

nerna

Revenue

Co d e

o

986,

as

m e n d e d ,

o

t her

pubc

o

rivae

n v e s t m e n t

entity (

in

each

case

whehe

act ing

as

p r i n c i p a l

o

gen t ) ;

a

r o k e r a g e

o

i n v e s t m e n t

banking

o rgan iza t i on (

in

each

case

w h e t h e r

acting

individually

o

in

a

i d u c i a r y

o

e p r e s e n t a t i v e (

such

a

n

gency)

c a p a c i t y )

as

rincipal

o

agent);

an

m p l o y e e s

w e l f a r e ,

benet,

pension

o

r e t i r e m e n t

und

n

instituiona

leasing

company;

any

o v e r n m e n t a l a g e n c y

o

enity

insued

by

a

o v e r n m e n t a l

agency

o

8/15/2019 264-97 RDA

22/48

an

instituiona

lender

only

if (

t the

timeit

ecomes

an

instituiona

lender)

it

shal (

i)

ave assets of

not

less

than$

100

00,

000

d j u s t e d for inf lation and (

ii)no

e an

a f f i l i a t e

o

RDP

it

eing futher

a g r e e d

that

noneo

the

t a n d a r d s

se

fothin

his

defintion

hall

be

p p l i c a b l e

to

participants

or

co -

lendersin

a

oa n

secued

by

ortgage

w h i c h

ishedby

a

inst i tut ional

ender

w h e t h e r

a c t i n g i n d i v i d u a l l y

o

n

a

i duc ia ry o r e p r e s e n t a t i v e (

suchas

ngency)

capacty).

The

erm

institutional lender"

ason c l u d e s an

affiliateo

nnsti tuona l e n d e r

as

descibed

in

hssubparagraph

5

9

59

2DPsha

btan

a

ndng

loan cor run i

tmn

from

an i n s t i t u t i o n a l

lender (

the"

ender )

in

he

amoun t

o

n ess

than thrty o ne

mllion

d o l l a r s ( $ 31

000

000

foheo n s t r u c t i o no

he

Hotel.

A

opy o

the

e x e c u t e d

loan

o r r u n i t m e n t

shall

be

elivered

to

the

g e n c y

and

the

it yno

ater

than sixty (

60aysate

he

e x e c u t i o n

othsLetter

o

n t e n t . All

o

he tem

and

ondtions

of said

oan

orruni t m e n t

shall

bein

orman d

substance

r e a s o n a b l y s a t i s f a c t o r y

to

the A g e n c y

andheity.

59

3

l

l enders

shalbe

r e q u i r e d

to

end

c o p i e s

oal

efault

notices o

oher

o t i c e s

r e l a t i n g totheailure

to

eephe

Loan

in

good standng

w h i c h

are

sent

p u r s u a n t to

a

loan documento

security

d o c u m e n t toRDP

o

he

u a r a n t o r s , to

the

City and

the

Agency.

5

9

Al

l enders

sha

c o m p l y

with

al

r e a s o n a b l e

estoppe

requests

of

the

Cty

and

the

Agency. 5

10

Purchase o

Aqency'

s

nterest . 5

10

he Agency

o

the

ity,

as

ppicabe, each

a

its

ol e

opt ion

and

ac hin

ts

sole discret ion, m ay require

RDP

to

u r c h a s e

o

mkenstallment

P a y m e n t s

defined

in

ubparagraph

5

05

hereinbelow)

toward

the

u r c h a s e

o

heg e n c y 'snterest

inthe

Land

a

the

urchase price

o

ten

million

d o l l a r s ( $

10

000

00) plus

thee q u i r e d

retun(

r e f e r r e d

to

in

u b p a r a g r a p h s 5

10

3

nd

5

0

4

hereinbelow) (

the "

Purchase

Pce)

t the

me

o

each

e f inanc ing ,

whch

ref inancing

shall

occu

on

o

prio

to

the

eginning

othe

fifth(

h),

enh(

0th)and

wenty- fifth (

25th)

e a r s

after

the

p e n i n g

Daen d

every

ten(0)

years

t h e r e a f t e r ,

to

the

exten


8/15/2019 264-97 RDA

23/48

wth

theformua

set forth

in

subparagraphs

5

10

3 5

10

4

nd

5

0

5

e r e i n b e l o w .

A

The Agency

o

he

Cty

as a p p l i c a b l e ,

each

a

its

soe

option

and

each

in

its soe dscreon

may

asoe q u i r e

RDP

to

urchase,o

mke

n s t a l l m e n t

P a y m e n t s (

defined

in

subparagraph

5

10

5

h e r e i n b e l o w )

t owards

theu r c h a s e

o,

he

g e n c y '

s

n t e r e s t intheand any

tim

hat

RDP

o l u n t a r i l y

refnances

th e

Hotelto

th e

exentha

et proceeds

as

d e f i n e d in

subpa rag raph 5

5

B

are

avalabe.B

o t w i t h s t a n d i n g

anything

in

thsu b p a r a g r a p h

5

1

1

to

he

conrary

r o v i d e d that

RDP

has not

previously

p u r c h a s e d the

A g e n c y '

s

neest,

RDP shall

p u r c h a s e

the

Agency

s

n t e r e s t

in

the

and

in

its

ent i re ty

and a

the

full P u r c h a s e

Price,

less

any

I n s t a l lm e n t

P aym e n t s ( d e f i n e d

in


5

0

5

e r e i n b e l o w ) p r e v i o u s l y

made

by

RDP

ahe

end

o

the

wenty -

fifth (

25th) year

afterthe

penng

Date;

u n l e s s

the

gency

o

the

ity

as

a p p l i c a b l e

e a c h

a

ts

soe

p t i o n

and eachn

its

o le d i s c r e t i o n , notifies

RDP,

in

riting, that

the

g e n c yo

heCtyis

r e s c h e d u l i n g

ths

u r c h a s e

o

its

i n t e r e s t

asaforesaid

to

a

ater

date,

which

lae

ae

sha

be decdedupon

s o l e l y

by

the

Agency

o

he

i ty.

In

the

even

he

A g e n c y

o

h e

Cty

e s c h e d u l e s

this

purchase

as

foresaid,

then,

in

ha

event ony

there

shallbe

nourther


o

the

e s s o r '

s

i n t e r e s t

inhe

r e n t a l

p a y m e n t s

unde r

the

round

Lease.

5

10

2

DP

ms

pa

he

enire

Purchase

Price

u p o n

the

occurrence

of (

i

ny

sae

o

he

Hotel (

as

hereinafter

d e f i n e d ) , subject

to

he

provsions

of

subparagraph

6

3

ereinbelow

and

a rag raph

12 h e r e i n b e l o w ,

o(i)

he

expirat ion

o

tweny-

five(

25

ears

from

the

Opening

Dae

ubject

to

the

rovisions o

subparagraph

50

1

B

e r e i n a b o v e ,

whichever

o c c u r s

first. 5

10

3u r c h a s e

Price

ifPad

with in

Ten(

10

ears from

the

peninq

Dae.For

the

en(

0)

year period

c o m m e n c i n g

wth

the

O p e n i n g

8/15/2019 264-97 RDA

24/48

by

RDP,

cacuatedas

a

reurn

on

theamoun

of fivemllionfivehundred

thousand

dollars

5500, 000) o

as

f

the

daenynstallment Payments, such

lesse

a m o u n t

ate

deducting

any

Installment

Payments

made

prov ided, however,

tha

each

I n s t a l l m e n t

Payment

shall

be

o u n t e d

ony

n c e fo

puposes

o

ths

ubparagraph 5

10

3

n d

subparagraph

5

0

4e r e i n b e l o w ) ,

and

giving

RDP

a

credit

fol

Base

and

f i f t y -

five percent (

55%)

o

ny

I n c e n t i v e Ren

pad

PLUS

B

T h e

sum

o

fve

nda

haf

m i l li o n

dolars

5

500

000;

L U S

C

he

amoun

requred

fo

the

Agency

toc h i e v e anight p e r c e n t (

B%

pe r

year

aveage

eturn,

f r o m thep e n i n g

Date

to

the date

oaymentby

DPalculated

as

a

e t u r n onthe

a m o u n t

o

fou

mllion

five

hundred thousand

dollars

4

00,

000

o

s

o

he

ae o

ay

Installment

Paymen ts ,

such lesse

amoun t

ate

d e d u c t i n g

any

n s t a l l m e n t

P a y m e n t s

made

p r o v i d e d ,

however,

tha

ach

Instal lment

P a y m e n t s h a l l

be

o u n t e d

only

onceo

p u r p o s e s

o

ths


5

0.

3

andu b p a r a g r a p h

5

10

4

e r e i n b e l o w ) ,

and

gvng

RDP

a

edt for

alddtiona

R e n t

pad

nd

foty

ive

percent (

45%

o

ny Incenve

Rent pad, provided,

however,

tha

a n y I n c e n t i v e

Rent

paid

after

the

a m o u n t s

r e f e r e n c e d

in

ubparagraph

5

0

3A

ere inabove

have

been

pad

shall

be

redited

a

ne

hundred

percent

100%;

PLUS

D

The

sum

o

four

and

a

haf

illion

dollars

4

500

00).

5

1 0.

4

urchase

P r i c e

if

Pad

Ater

Ten (

10

Y e a r s

from

he

Opennq

Dae.

F o r

the

period

ater

ten(

10

years

have eapsed

f r o m

the

Opening

Date,

the

Purchase

Pice

shal

be

calculated

as

o l l o w s : A

he

su m

o

th e

a m o u n t s

saed

n

u b p a r a g r a p h s 5 0

3

A

B a n d

D

ereinabove;

PLUS

B

he

moun

r e q u i r e d

for

the Agency

to

c h i e v e

a

ten

pe rcen t (

8/15/2019 264-97 RDA

25/48

Instalmen

Payments,

such lesser

amount after

deducting

any

Instalmen

Payments

made

provided,

however,

that

each

Instalmen

Payment

shal

be couned

only

once for

purposes

of

subparagraph

5

03

hereinabove

and

ths


5

104nd givingRDP

a

credit

fo

al

Add

tona

Rent

paid

and

orty-

five percent (

45%

any

Incenive

Ren

paid,

provided,

h o w e v e r , tha

ay

n c e n t i v e

Ren

p a i d

ate

he

a m o u n t s

r e f e r e n c e d

in

u b p a r a g r a p h50.3A

here i nabove

have

een

pad

shal

be

cedted

a

ne

hundredpercent

100%.

5

10

5

n s t a l l m e n t P a y m e n t s .

Installment

paymens


Payments )

t o w a r d s

the

Purchase

Pce

c a n

be

made

ony

nhe olowng

m a n n e r

and subject

to

heo l l o w i n g

conditions:

A

Al

nstallment

P a y m e n t s are non-

r e f u n d a b l e .

Bll

rental

paymns

u n d e r theGround Lease

shal

con t inue

tobe

ueand

payab le

by RDP

no tw i ths tand i ng

theact that


P a y m e n t s have

been made

unil

such tim

as

he

P u r c h a s e

Pce

as

e e n

pad

in

ful.

Ah e tim

o

na

payment

o

the

Purchase

Price

in

ul,

DP shall

receive

a

redit

fo


Payments

made

aong

wth

th e

appropriate c r e d i t

foal

Ground

Lease

r e n t

pad

s

a p p l i c a b l e ,a

rovided a b o v e . Croceeds

oac h

Documents

264-97 RDA