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HomeMy WebLinkAboutAuthorizing the execution of a development management agreement with Gerald D. Hines interestsAttest: RESOLUTION N0. 642 -78 Passed by the Common Council of the City of South Bend, Indiana, Attest: September 11 19 78 . ity Clerk President of Common Council. Presented by me to the Mayor of the City of South Bend, Indiana September 12 19 78 City Clerk Approved and signed by me a 19-2-k- Mayor RESOLUTION NO. G Y Q -7�8 RESOLUTION WITH RESPECT TO DEVELOPMENT AND CONSTRUCTION OF A MULTI -USE PROJECT IN THE BLOCK BOUNDED BY COLFAX, MICHIGAN, WASHINGTON AND ST. JOSEPH STREETS IN SOUTH BEND, INDIANA AND AUTHORIZING THE EXECUTION OF A DEVELOPMENT MANAGEMENT AGREEMENT WITH GERALD D. HINES INTERESTS. WHEREAS, construction is proposed of a multi -use complex consisting of an office building containing approximately 135,000 square feet, a high quality motel containing a minimum of 250 rooms, approximately 30,000 feet of retail space, an enclosed atrium inter- connecting the various structures and containing an ice rink, an all - weather garage containing approximately 800 parking spaces, and an enclosed walkway to the Century Mall, all of which improve- ments will be located in an area bounded by Colfax Avenue on the North, St. Joseph Street on the East, Washington Street on the South and Michigan Street on the West, in South Bend, Indiana. WHEREAS, the City of South Bend has received approval from the United States Department of Housing and Urban Development under Title I of the Housing and Community Development Act of 1977 for an Urban Development Action Grant in the amount of $7,600,000 for construction of the public portion of said project. WHEREAS, the First Bank and Trust Company of South Bend, Indiana, and Marriott Hotels of Washington, D. C., or a nominee thereof, propose construction of the office building and the hotel portion respectively of said project. WHEREAS, the City of South Bend is required to submit to the United States Department of Housing and Urban Development, a written agreement executed by the City of South Bend, the Redevelopment Commission of the City of South Bend, Indiana, First Bank and Trust Company of South Bend, Indiana, and Marriott Hotels of Washington, D. C., or its nominee, providing (i) for the disposition of the site for the construction of the office building, retail space and hotel; (ii) for the setting forth of the duties and obligations of the respective parties concerning the development of the multi -use complex; (iii) for the total combinedinvestment of Gerald D. Hines Interests, First Bank and Trust Company of South Bend, Indiana, and Marriott Hotels of Washington, D. C., of not less than $21,096,000. WHEREAS, the Grant from the United States Department of Housing �nd Urban Development, requires that interim financing and permanent financing be obtained for the office building, retail space and hotel in the principal sum of $15,822,000. WHEREAS, it is essential to the success of the project that the City of South Bend avail itself of the services of a Development Manager with the necessary experience and expertise in (i) obtaining commitments for participation in the project by First Bank and Trust Company of South Bend, Indiana, and Marriott Hotels of Washington, D. C.; (ii) obtaining the required interim and permanent financing for the participants in the project; (iii) coor- dinating with the architect the preparation of plans and specifications for the development of the multi -use project; (iv) providing services in the development, integration, coordination and supervision of the project as a whole and the development and construction management of the public portion of the project to be constructed by the City of South Bend. WHEREAS, the City of South Bend and Gerald D. Hines Interests have negotiated a form of Development Management Agreement setting forth the respective obligations of the parties to accomplish these purposes. WHEREAS, it is now advisable to authorize the execution of said Development Management Agreement between the City of South Bend, Indiana, and Gerald D. Hines Interests. NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of South Bend, Indiana: SECTION I. The proposed Development Management Agreement, attached hereto as Exhibit A, is hereby approved, and the Board of Public Works, the Mayor, and the City Clerk, are hereby authorized to execute the Agreement on behalf of the City. SECTION II. This Resolution shall be in full force and effect from and after its passage by the Common Council, and its approval by the Mayor. U l L � Member of t Ammon Council PRESENTED �- II ' /S NOT APPROVED ADOPTED C/-11- 7 J- FILED IN CLERK'S OFFICE `.. 61978 Irene ;; )r, DIM ME+tYf, BEND, IND. 5 r DEVELOPMENT MANAGEMENT AGREEMENT BETWEEN GERALD D. HINES INTERESTS AND THE CITY OF SOUTH BEND, INDIANA Exhibit A DEVELOPMENT MANAGEMENT AGREEMENT BETWEEN GERALD D. HINES INTERESTS AND THE CITY OF SOUTH BEND, INDIANA Page PREAMBLE ARTICLE 1. Negotiation and Procurement of Contractual Commitments by the Development Manager ... 1 ARTICLE 2. Obtainment of Approval for the.Expenditure of Monies by the City 2 ARTICLE 3. The Development Manager's Compensation ... 3 ARTICLE 4. Basic Services to be Rendered by the DevelopmentManager ...................... 8 ARTICLE 5. Additional Services to be Rendered by the DevelopmentManager ...................... 16 ARTICLE 6. Responsibilities of the City ............. 18 ARTICLE 7. Insurance . ............................... 21 ARTICLE 8. Successors and Assigns ................... 22 ARTICLE 9. Termination of Agreement ................. 23 ARTICLE 10. Notices ... ............................... 25 ARTICLE 11. Extent of Agreement ...................... 26 ARTICLE 12. Governing Law ............................ 27 ARTICLE 13. Definitions .............................. 28 DEVELOPMENT MANAGEMENT AGREEMENT PREAMBLE. This Agreement made this day of , 1978, between Gerald D. Hines Interests, a sole proprietorship, Houston, Texas (hereinafter called the "Development Manager ") and the City of South Bend, Indiana (hereinafter called the "City "), for professional services to be rendered by the Development Manager in connection with the following described Project (hereinafter called the "Project "): A multi -use complex consisting of an office building containing approximately 135,000 square feet, a high quality hotel containing a minimum of 250 rooms, approximately 30,000 square feet of retail space, an enclosed atrium interconnecting the various structures and containing an ice rink, an all - weather garage containing approximately 800 parking spaces, and an enclosed walkway to the Century Center, all of which will be located in the block bounded by Colfax, Michigan, Washington and St. Joseph streets in South Bend, Indiana. Now, therefore, the City and the Development Manager agree as follows: ARTICLE 1. NEGOTIATION AND PROCUREMENT OF CONTRACTUAL COMMITMENTS BY THE DEVELOPMENT MANAGER 1.1 Within 180 days from the date this Agreement is executed, the Development Manager, on behalf of the City, shall negotiate and procure the following contractual commitments from the owners and /or operators of the office building, hotel and retail space in the Project (hereinafter collectively called the "Principal "), subject to the City's approval: 1.1.1 Financing and construction of their respective facilities in the Project; 1.1.2 Ownership and /or operation of their respective facilities in the Project; provided, however, that the City shall at no time be or become an owner and /or operator of any of the Principals' facilities in the Project; and 1.1.3 Development management and construction management of their respective facilities in the Project 1.2 The Development Manager covenants with the City to expedi- tiously and economically use its professional skill and judgment, consistent with the interests of the City, in negotiating and procuring these contractual commitments and in furthering the development of the Project. ARTICLE 2. OBTAINMENT OF APPROVAL FOR THE EXPENDITURE OF MONIES BY THE CITY Within 180 days from the date this Agreement is executed, the City shall obtain the approval for the expenditure of monies from its 7.6 million dollar Urban Development Action Grant for the benefit of the Project. - 2 - ARTICLE 3. THE DEVELOPMENT MANAGER'S COMPENSATION The City shall compensate the Development Manager in accordance with the following terms: 3.1 For the Basic Services rendered by the Development Manager pursuant to Article 4 hereof, the Development Manager's compensa- tion shall be a fixed fee of $825,000. The Development Manager shall receive $495,000, or sixty percent of the fixed fee, during the Design Phase of the Project and the remaining $330,000, or forty percent of the fixed fee, during the Construction Phase of the Project. 3.2 For the Additional Services rendered by the Development Manager pursuant to Article 5 hereof, the Development Manager's compensation shall be computed as follows: 3.2.1 Time of Managers at the fixed rate of $140.00 per hour. For purposes of this Section, the Managers are Richard G. Hanson, John A. Harris and Richard R. Bryan. Said Managers shall not be changed without the written consent of the City, unless they become unsatisfactory to the Development Manager and /or cease to be employed by the Development Manager in a similar capacity. 3.2.2 Time of Employees assigned to the Project in the Development Manager's office or at the construction site, at a multiple of three (3) times the employees' Direct Personnel Expense. - 3 - 3.2.3 Services of professional consultants at a multiple of one (1) times the amount billed the Development Manager for such services. 3.3 For Reimbursable Expenses, which are expenses incurred by the Development Manager, its employees or professional consultants in the interests of the Project, the Development Manager's compensation shall not exceed the sum of $235,000. The City reserves the right of prior approval of all Reimbursable Expenses, which approval shall not be withheld unreasonably, and the right to incur Reimbursable Expenses which would otherwise be incurred by the Development Manager, when appropriate and acceptable to the Development Manager. Reimbursable Expenses shall include, but not be limited to, the following: 3.3.1 Employees' Direct Personnel Expense. 3.3.2 Long distance calls, telegrams and fees, including attorney's fees, for obtaining the approval of the authorities having jurisdiction over the Project. 3.3.3 Handling, shipping, mailing and reproduction of materials related to the Project. 3.3.4 Transportation, lodging and meals when traveling in connection with the Project. 3.3.5 Relocation. - 4 - 3.3.6 Overtime work requiring higher than regular rates, with prior consent of the City. 3.3.7 Electronic data processing services and rental of electronic data processing equipment in connection with the rendition of Additional Services pursuant to Article 5 hereof. 3.3.8 Premiums for the insurance the Development Manager is required to maintain pursuant to Article 7 hereof. 3.3.9 Construction support activities, unless they are provided by the contractors. 3.4 Termination Expenses are the expenses incurred by the Develop- ment Manager, its employees or professional consultants in the interests of the Project, after notice of termination is given or the date of termination, and an amount computed by multiplying the Development Manager's compensation for the Basic Services rendered to the date of termination by either twenty percent if notice of termination is given during the Design Phase or ten percent if notice of termination is given during the Construction Phase. 3.5 Upon execution of this Agreement the City shall make an initial payment to the Development Manager in the amount of $80,000, said payment shall be credited to the $495,000, or sixty percent of the fixed fee, which the Development Manager shall receive during the Design Phase of the Project. - 5 - 3.5.1 Within 180 days from the date this Agreement is executed, if either the Development Manager fails to procure the contractual commitments referred to in Article 1 hereof or the City fails to obtain the approval for the expenditure of monies referred to in Article 2 hereof, the Development Manager's compensation shall be limited to said initial payment of $80,000. 3.6 Upon the Development Manager's procurement of the contractual commitments referred to in Article 1 hereof and the City's obtain- ment of the approval for the expenditure of, monies referred to in Article .2 hereof, the City shall make payments to the Development Manager for the Basic Services and Additional Services rendered, plus the Reimbursable Expenses incurred, from the date this Agreement is executed, in the amounts indicated on statements submitted to the City by the Development Manager. Said payments shall be made within thirty (30) days from the date of billing. 3.7 Thereafter, the City shall make payments to the Development Manager for the Basic Services and Additional Services rendered, plus the Reimbursable Expenses incurred, in the amounts indicated on monthly statements submitted to the City by the Development Manager. Said payments shall be made within thirty (30) days from the date of billing. 3.8 In the event the Construction Progress Schedule provided pursuant to Section 4.3 hereof is exceeded by more than ninety (90) days through no fault of the Development Manager, the Development Manager's compensation for Basic Services rendered pursuant to Article 4 hereof after the ninetieth (90th) day shall be computed in accordance with Section 3.2 hereof. 3.9 No deductions shall be made from the Development Manager's compensation for Basic Services, Additional Services, Reimbursable Expenses or Termination Expenses because of penalties, liquidated damages. or other sums withheld from payments to contractors. 3.10 A payment due the Development Manager which is unpaid for more than sixty (60) days from the date of billing shall bear interest at the rate of ten (10) percent per annum unless a valid reason exists for withholding such payment. - 7 - ARTICLE 4. BASIC SERVICES TO BE RENDERED BY DEVELOPMENT MANAGER The Development Manager shall provide the following Basic Services in the development, integration, coordination and super- vision of the Project as a whole and the development management and construction management of the Public Improvements in the Project which are the enclosed atrium interconnecting the various structures and containing an ice rink, the all - weather parking garage, and the enclosed walkway to the Century Center. 4.1 Procure the services of Architect, subject to the concurrent approval of the City and the Principals. 4.2 Advise on the conceptual drawings submitted by the Architect during the development of the Project, site use and improvements, selection of materials, building systems and equipment. Make recommendations on relative construction feasibility, availability of labor and materials, time requirement for installation and construction, preliminary budgets, possible economies and factors related to cost, including costs of alternative designs or materials. 4.3 Provide a Construction Progress Schedule that coordinates and integrates the Architect's services with construction schedules. The Construction Progress Schedule shall be related to the entire Project, to the extent required by the Contract Documents, and shall reflect a sequence of operations mutually agreeable to the City and the Development Manager. The - 8 - Construction Progress Schedule shall contain an itemized break- down of all Work on the Project, the delivery dates for all materials and equipment, and the estimated dates for commencement and completion of construction of each of the Project components. 4.3.1 The Development Manager shall endeavor to maintain the progress of the Project in accordance with the Construction Progress Schedule. If the time for completion of the Project is extended, the Development Manager shall revise the Construction Progress Schedule, subject to the City's approval. 4.4 Prepare a Project budget and Public Improvements budget as soon as the major Project and Public Improvements requirements have been identified, subject to the City's approval. Advise on estimated budget changes which are significant. Prepare an estimate of construction cost based on a quantitative survey of the drawings and specifications at the end of the schematic design phase, and revise this estimate as the development of the drawings and specifications proceeds, subject to the City's approval. If it appears that the Project budget or the Public Improvements budget will not be met, the Development Manager shall immediately inform the City and the Architect and make recommendations for corrective action. 4.4.1 The Public Improvements budget shall include the Development Manager's anticipated Reimbursable Expenses for those items included in 3.3.1 through 3.3,.6 inclusive, 3.3.8 and 3.3.9. The Development Manager shall further advise the City of any estimated significant changes in Reimbursable Expenses upon their occurance. - 9 - 4.5 Review the drawings and specifications as they are being prepared and recommend alternative solutions whenever design details affect construction feasibility or schedules. 4.6 Verify that the requirements and assignments of responsibility for safety precautions and programs, temporary Project facilities, and equipment, materials and services for common use of contractors have been included in the Contract Documents. 4.7 Advise on the selection of contractors and awarding of contracts, including the potential problems created by areas of overlapping jurisdiction and phased construction. 4.8 Establish a purchase schedule for all materials and equipment requiring long lead time procurement, and coordinate this schedule with the early preparation of bid awards. 4.9 Provide an analysis of the types and quantities of labor required for the Project and review the availability of the appropriate categories of labor required for critical phases. Assist in determining and complying with applicable requirements of Equal Employment Opportunity programs and other regulatory requirements of the Federal and State governments necessary for inclusion in the Contract Documents. 4.10 Prepare pre -bid qualification criteria for bidders and develop contractor interest in the Project. Establish bidding schedules and conduct pre -bid conferences to familiarize the bidders with the bidding documents and other requirements result- ing from the City being a municipality. - 10 - 4.11 Assist in awarding contracts for the Project by preparing bid analyses and submitting a list of bids for all contracts or orders for materials, with prices and recommendations for award- ing of contracts or rejecting of bids. 4.12 Coordinate the work of the contractors with the activities and responsibilities of the City and the Architect to complete the Project in accordance with the City's objectives on cost, time and quality. Schedule and conduct pre- construction and progress meetings at which the City, the Development Manager, the Architect, the Principals and the contractors can jointly discuss such matters as procedures, progress, problems and scheduling. 4.13 Provide a detailed schedule for the operations of contractors on the Project, including realistic activity sequences and durations, allocation of labor and materials, processing of shop drawings and samples, delivery of products requiring long lead time procurement and the City's occupancy requirements showing portions of the Project having occupancy priority. Provide regular monitoring of the schedule as construction progresses and identify and inform the City of potential variances between the schedule and probable completion dates. Review the schedule for work not started or completed and make recommendations to the City and the contractors on adjustments in the schedule to meet the probable completion dates. - 11 - 4.14 Inform of any failure, of subcontractors to fulfill require- ments of contracts and advise on appropriate and available corrective action. 4.15 Inform of any necessary revision of the approved estimate of construction cost and suggest changes in the construction schedule to accomodate cash flow forecasts. Assist in the maintenance of cost accounting records on authorized work performed under unit costs, actual costs for labor and materials, or other bases requiring accounting records,, recommend necessary or desirable changes to the City and Architect and assist in negotiating such changes. Assist in developing and implementing a system for review and processing of change orders and applica- tions for extensions of time. 4.16 Assist all contractors and subcontractors in obtaining all building permits and special permits for permanent improvements, excluding permits for inspection or temporary facilities required to be obtained directly by the various contractors. Verify that the City has paid all applicable fees and assessments for permanent facilities and has obtained approval from all authorities having jurisdiction over the Project. 4.17 Inspect the work of contractors to assure that it is being performed in accordance with the Contract Documents. 4.17.1 The Development Manager shall guard against defects in the Work and if the Development Manager becomes aware that the Work is not in accordance with the Contract - 12 - Documents, whether such work be then fabricated, installed or completed, the Development Manager shall require any contractor to stop Work or a designated portion thereof, or require special inspection or testing, and immediately inform the City and recommend appropriate and applicable solutions, including whether the City should reject such Work; provided, however, that the Development Manager shall not be responsible for the means, methods, techniques, sequences and procedures employed by contractors in performance of their contracts, nor shall the Development Manager be responsible for the failure of any contractor to carry out the Work in accordance with the Contract Documents. 4.18 Assist in resolving any questions which arise between the City and any contractor or subcontractor with respect to the meaning and intent of the drawings and specifications. 4.19 Establish and implement procedures for expediting the processing and approval of shop drawings, samples, catalogs and other Project papers. 4.20 Record the progress of the Project and submit written progress reports, at least monthly, which include information on the contractors and the work, the percentage of completion, and the number and extent of changes orders. Keep a daily log available to the City. 4.21 Maintain at the Project site,`on a current basis, records of all: contracts; shop drawings; samples; purchases; materials; - 13 - equipment; applicable handbooks; federal, commercial and technical standards and specifications; maintenance and operating manuals and instructions; and any other related documents and revisions thereto. Obtain from contractors and subcontractors, and maintain, a current set of drawings, specifications and operation manuals. At the completion of the Project, deliver all such records to the City. All models obtained during the construction of the Project, which have been paid for by the City, are the property of the City. 4.22 Upon the contractors' determination of substantial comple- tion of the Work or a designated portion thereof, prepare a list of incomplete or unsatisfactory items and a schedule for their completion or correction. Upon certification of the date of substantial completion, supervise the completion or correction of these items. 4.23 Upon the Development Manager's determination of final completion of the Project, give written notice that the Work is ready for final inspection. Secure and transmit required guarantees, affidavits, releases, bonds and waivers. Turn over all keys, manuals, record drawings and maintenance stocks. 4.24 Assist in requiring contractors to correct any defaults in their Work, supervise the corrections and recommend acceptance when corrections are completed; provided, however, that the City shall give written notice to the Development Manager of any such defects, whether latent or patent, within - 14 - one (1) year from the certified date of substantial completion of the Work. 4.25 Inspect the Work of the contractors sixty (60),to ninety (90) days prior to the end of the guarantee periods provided in their contracts and furnish detailed reports of discrepancies between the Work and such guarantees. 4.26 Assist the City and the Principals in securing private or public financing for the Project. 4.27 Assist contractors and subcontractors in finding housing for construction labor and defining requirements for establishment and maintenance of base camps. Assist in obtaining and training maintenance personnel or negotiating maintenance of the service contracts. 4.28 It is .the intent of the parties to this Agreement that all of the Basic Services set forth in this Article to be rendered by the Development Manager as the same are applicable or may be construed to the Project as a whole shall have equal applicability and construction to the Public Improvement portion of the Project. - 15 - ARTICLE 5. ADDITIONAL SERVICES TO BE RENDERED BY THE DEVELOPMENT MANAGER Upon written authorization by the City, the Development Manager shall render Additional Services, which Additional Services shall include, but not be limited to, the following: 5.1 Services related to investigating, approving or evaluating existing conditions, facilities or equipment, or verifying the accuracy of existing drawings or other City- furnished information. 5.2 Services related to City- furnished equipment, furniture and furnishings which are not a part of the Work. 5.3 Services related to construction performed by the City. 5.4 Consultation on replacing Work damaged by fire or other cause during construction, which is not attributable to the negligent or willful conduct of the Development Manager, and services related to replacing such Work. 5.5 Services made necessary by the default of a contractor. 5.6 Preparing to serve and /or serving as an expert witness in connection with any public hearing, arbitration proceeding or legal proceeding; provided, however, that none of the Principals are parties to such public hearing, arbitration proceeding or legal proceeding. 5.7 Services related to the Project after the rendition of the the Basic Services referred to in Article 4 hereof, including - 16 - inspections of the Project. - 17 - ARTICLE 6. THE RESPONSIBILITIES OF THE CITY The City's responsibilities shall include the following: 6.1 Provide full information regarding its requirements for the Project. 6.2 Designate a representative who is fully acquainted with the scope of the Project, and authorized to promptly furnish information and render decisions concerning the Project. 6.3 Furnish such architectural and engineering services from the Architect whose services were procured by the Development Manager in accordance with Section 4.1 hereof as the Development Manager deems necessary to enable the Development Manager to negotiate and procure the contractual commitments referred to in Article 1 hereof; provided, however, that the Architect's compensation for such architectural and engineering services shall not exceed the sum of $90,000. 6.4 Furnish a certified land survey of the site giving, as applicable, grades and lines of streets, alleys, pavements and adjoining property; rights of way, restrictions, easements, encroachments, zoning, deed restrictions, boundaries and contours of the site; locations, dimensions and complete data pertaining to existing buildings, other improvements and tress; and full information concerning available service and utility lines both public and private, above and below grade, including inverts and depths. 6.5 Furnish the services of a soils engineer or other consultant when such services are deemed necessary by the Development Manager, including reports, test borings, test pits, soil bearing values, percolation tests, air and water pollution tests, ground corrosion and resistivity tests, and other necessary operations for determining subsoil, air and water conditions, with appropriate professional recommendations. 6.6 Furnish structural, mechanical, chemical and other laboratory tests, inspections and reports as required by law or the Contract Documents. 6.7 Furnish such legal, accounting and insurance counselling services as may be necessary for the Project, and such auditing services as it may require to ascertain how or for what purposes the contractors have used the monies paid to them under the construction contracts; provided, however, that this responsibility of the City shall in no way obviate the Basic Services to be rendered by the Development Manager pursuant to Article 4 hereof. 6.8 The City shall furnish the services, information, surveys, tests, inspections and reports required by Sections 6.3 -6.7 of this Article at its own expense and the Development Manager shall be entitled to rely on the accuracy and completion thereof. 6.9 Furnish the Development Manager with a sufficient quantity of construction documents. 6.10 Give the Development Manager prompt written notice of any defect in the Project, or any non- conformance with the Contract - 19 - Documents, of which the City becomes aware. 6.11 Advertise for bids on the Public Improvements in the Project, which are the enclosed atrium interconnecting the various structures and containing an ice rink, the all - weather parking garage, and the enclosed walkway to the Century Center, and award contracts for such improvements. - 20 - ARTICLE 7. INSURANCE 7.1 The Development Manager shall maintain insurance to protect itself from claims: under workmen's compensation acts; for damages because of bodily injury, including personal injury, sickness or disease, or death;.for damages because of injury to or destruction of tangible property, including loss of use resulting therefrom; and for damages because of any acts or omissions in the Development Manager's performance of professional services under the terms of this Agreement. 7.2 The Development Manager agrees to indemnify and save the City harmless from and against any and all liability, loss, damage and expense, including attorney's fees, that the City may suffer and incur solely as a result of any acts or omissions in the Development Manager's performance of professional services under the terms of this Agreement. - 21 - ARTICLE 8. SUCCESSORS AND ASSIG14S The City and the Development Manager each binds itself, its partners, successors, assigns and legal representatives to the other party to this Agreement and to the partners, successors, assigns and legal representatives of such other party with respect to all covenants of this Agreement. The Development Manager shall not assign or transfer its interest in this Agreement without the written consent of the City. - 22 - ARTICLE 9. TERMINATION OF AGREEMENT 9.1 This Agreement will automatically terminate upon the expira- tion of 180 days from the date this Agreement is executed if either the Development Manager fails to procure the contractual commitments referred to in Article 1 hereof or the City fails to obtain the approval for the expenditure of monies referred to in Article 2 hereof. 9.2 This Agreement may be terminated by either party upon thirty (30) days' written notice should the other party fail to sub- stantially comply with its terms through no fault of the party initiating termination. 9.2.1 In the event of such termination through no fault of the Development Manager, the City shall make payments to the Development Manager for the Basic Services and Additional Services rendered to the date of termination, plus Reimbursable Expenses and Termination Expenses incurred, in the amounts indicated on statements submitted to the City by the Development Manager. Said payments shall be made within thirty (30) days of the date of billing. 9.2.1.1 In the event of such termination through no fault of the Development Manager prior to the date the City obtains the approval for the expenditure of monies referred to in Article 2 hereof, or in the event of such termination through the fault of the Development Manager, the City shall not be liable for the Termination Expenses incurred. - 23 - 9.3 This Agreement may also be terminated by the City upon seven (7) days' written notice should the Development Manager be adjudged a bankrupt (and an appeal or motion to set aside is not pending), or make a general assignment for the benefit of creditors or should a receiver be appointed because of its in- solvency, and such adjudication, assignment or appointment of a receiver is not cured, without prejudice to any other right or remedy the City may have. 9.3.1 In the event of such termination, the City may with- hold payment of the amounts due the Development Manager, pending a determination of the damages, if any, resulting from such adjudication, assignment or appointment of a receiver. - 24 - ARTICLE 10. NOTICES Any notice which either party is required to give under the terms of this Agreement, or any law or government regulation, shall be in writing and shall be presumed to have been given when sent by registered or certified mail to the person who executed this Agreement on behalf of the party to whom the notice is being given at that party's correct address, unless otherwise specified. For purposes of this section, the City's address is Thomas J. Brunner, Jr., City Attorney, County -City Building, 227 West Jefferson Boulevard, 14th Floor, South Bend, Indiana 46601 and Patrick M. McMahon, City Engineer, County -City Building, 227 West Jefferson Boulevard, Suite 1316, South Bend, Indiana 46601, and the Development Manager's address is Gerald D. Hines Interests, 2100 Post Oak Tower, Houston, Texas 77056. Either party may designate different persons arid /or addresses by giving written notice to the other party; provided, however, that no such notice shall be effective until received. - 25 - ARTICLE 11. EXTENT OF AGREEMENT 11.1 This Agreement represents the entire and integrated agree- ment between the City and the Development Manager and supersedes all prior negotiations, representations or agreements, whether written or oral. This Agreement may be amended only by written instrument signed by both the City and the Development Manager. 11.2 Nothing contained in this Agreement shall be deemed to create any contractual relationship between the Development Manager and the Architect, or the Principals, or any of the contractors, sub- contractors or material suppliers on the Project, nor shall anything contained in this Agreement be construed to give any third party a claim or right of action against the City or the Development Manager which would not otherwise exist without regard to this Agreement. - 26 - ARTICLE 12. GOVERNING LAW This Agreement shall be governed by the law of the State of Indiana - 27 - ARTICLE 13. DEFINITIONS For the purposes of this Agreement, general definitions of certain terms used herein are as follows: 13.1 "Work" is the furnishing of labor or materials undertaken by contractors pursuant to the Contract Documents. "Work" includes, unless otherwise specified, the furnishing of all material, labor, equipment, supplies, plants, tools, scaffolding, transportation, superintendence, temporary construction of every nature, contributions to union funds and benefits, insurance, taxes and all other services and facilities necessary for the full performance and completion of the requirements of the Contract Documents. "Work" also includes that which is produced, constructed or built pursuant to the Contract Documents, and the obligation of any contractor who bids to perform any portion of the Work to visit the site of the proposed Work, fully acquaint himself with the conditions as they exist and the character of the operations to be carried on under the proposed contract, thoroughly examine and familiarize himself with the drawings, specifications and associated bid documents, and make such investigation as he may see fit so that he shall fully understand the facilities, physical conditions and restrictions attending the Work under the Contract. 13.2 "Contract Documents" for contractors consist of the written agreement between the City and the contractor or materialman and the specifications, drawings and modifications, addenda and amendments thereto which the Architect may furnish through the Development Manager during the progress of the Work. When the contractor is involved, the term "Contract" when used in the specifications, General Conditions, or drawings shall be considered as synonymous with the term "Contract Documents ". To the extent it is necessary to apply these General Conditions to the relation- ships between the City and the Development Manager, and only to this extent, the "Contract Documents" include the agreement between the Development Manager and the City and the Contract as defined therein. 13.3 "Direct Personnel Expense" is the salaries of the profes- sional, technical and clerical employees engaged on the Project by the Development Manager, and the cost of their mandatory and customary benefits, such as statutory employee benefits, insurance, sick leave, holidays, vacations, pensions and similar benefits. 13.4 "Design Phase" will commence the date this Agreement is executed and conclude with the award of the first construction contract or purchase order. - 29 - 13.5 "Construction Phase" will commence with the award of the first construction contract or purchase order and conclude upon the expiration of thirty (3) days from the date the final certificate for payment is issued by the Architect. This Agreement executed the day and year first written above. BOARD OF PUBLIC WORKS THE DEVELOPMENT MANAGER CITY OF SOUTH BEND ATTEST: MAYOR PETER J. NEMETH ATTEST: - 30 - OFFICE OF THE MAYOR CITY of SOUTH BEND PETER J. NEMETH, Mayor COUNTY -CITY BUILDING SOUTH BEND, INDIANA 46601 September 6, 1978 Members of the South Bend Common Council County -City Building 4th Floor South Bend, Indiana 46601 Dear Council Members: AREA 219 284 - 9261 The attached Resolution authorizes the Board of Public Works, the Mayor and the City Clerk to enter into a Development Management Agreement with Gerald D. Hines Interests of Houston, Texas. For your information, a copy of the Development Management Agreement itself is also attached. It is essential to the success of the project that the City of South Bend avail itself of the services of a Development Manager with the necessary experience and expertise in (1) obtaining com- mitments for participation in the project by First Bank and Trust Company of South Bend, Indiana and Marriott Hotels of Washington, D.C.; (2) obtaining the required interim and permanent financing for the participants in the project; (3) coordinating with the ar- chitect the preparation of plans and specifications for the develop- ment of the multi -use project; and (4) providing services in the development, integration, coordination and supervision of the project as a whole and the development and construction management of the public portion of the project to be constructed by the City of South Bend. It is our belief that Gerald D. Hines Interests is well - qualified to accomplish the foregoing objectives. Your authorization to execute this Agreement is respectfully requested. Peter J. Nemeth PJN /klh