ESM 10-17-79 - Laserfiche WebLink

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South BendlRedevelopment Commission Emergency Ppecial Meeting -- October 17, 1979 2. NEW BUSINESS Mr. Butler continues... Basically, we are providing that the plans and specifications must be submitted to the Commission by Jan ary 1, 1980 (the previous date was March 1, 1980) and we are stating that the construction plans must be approved by the Commission in final form by April ,1980 (the previous date was May 1, 1980). There 's provision in the Lease Agreement that no partne of the partnership may sell his interest withou approval by the Department of Redevelopment. AETNA asualty Insurance Company is a New York Corpor tion, and under the insurance laws of the State f New York, they cannot restrict at any time, y any agreement, their ability to transfer any in erest that they have in any property. They are re uesting that we make a specific exception with r spect to that particular partner of the parnte ship, and I would so recommend. Another ten mi lion dollars worth of bonds are going to be sol for the financing of the construction of the fa ility, and another two and a half million in equity put into the project by the partnership itself. They would like us to approve the specific mortgage and they outline, in their draft language, the to ms of that mortgage. We would be providing, by acc pting this particular provision, that the mortgage is acceptable to us. We have a provision in the Lease by which our rent payments are subordinated to the payments under any mortgage loan tat is approved by us; so we are approving this 1 an in advance. This is a usual provision. The la ;t provision that was requested was an exculp tion provision, basically stating that the partners and the partnership would not be liable for any of the obligations of the tenant under the Lease Agreem nt. The only recourse of the Agency would be a termination of the leasehold estate. In other words, we could take action to eject or evict them from the premis s. We have discussed this provision with the repres ntatives of the partnership and some of the partners of the partnership who were particularly intere ted in this provision. They have agreed to a fall back position, which would put them basically in the same situation had they incorporated. In other 4ords, the partners will not be personally liable for any of the obligations of the partnership under the lease, but the partnership itself, basically the as ets of the partnership, will be and we will have recour a against them. -3-