2 Minutes12-03-10 Meeting - Laserfiche WebLink

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South Bend Redevelopment Commission Regular Meeting –December 3, 2010 $750,000. There’s a construction deadline of December 31, 2013. Mr. Nussbaum stated that the city does not anticipate having to worry about that at all. We have every confidence that these improvements will be made; however, it is prudent to include such a guarantee. In addition, if there are drawdowns of city funds, there are provisions that if certain operational standards are not met, the city can get refunds for what it has paid for the garage. The important part of the clawback portion of the agreement is that no credit is given until all the improvements are done. So, again, the goal is making sure that the money that is promised to be invested in the project will be invested in the project. As in any business transaction, there may be the situation where it is a losing proposition. So, there are certain considerations given to Host, assuming that there are certain threshold levels of performance that are not met. Mr. Nussbaum noted that this was the subject of a lot of negotiation. We believe from the city side that it would need to be a pretty catastrophic event for Host to not meet those thresholds. It has never gotten that low before in its history and we think the agreement provides Host the kind of protection they needed, while at the same time providing the city and st 1 Source with the kind of protection we think we should have in order to make sure that the operation continues as it should. st Additional consideration to 1 Source and Host will be that the ground lease interest will be conveyed to the building owner and to Host. There have been some modest conveyance payments in the underlying documents, about $33,000 per year, split between the two parties. Those will go away as the result of this agreement. Then, at 12