Loading...
HomeMy WebLinkAboutNo. 2065 approving acquisition of real property to facilitate the studebaker national museum relocation project and approving the execution of a ground lease and other related documents associated with studebaker museum relocation project (SBCDA)RESOLUTION NO. 2065 A RESOLUTION OF THE SOUTH BEND REDEVELOPMENT COMMISSION APPROVING ACQUISITION OF REAL PROPERTY TO FACILITATE THE STUDEBAKER NATIONAL MUSEUM RELOCATION PROJECT AND APPROVING THE EXECUTION OF A GROUND LEASE AND OTHER RELATED DOCUMENTS ASSOCIATED WITH THE STUDEBAKER MUSEUM RELOCATION PROJECT (South Bend Central Development Area) WHEREAS, as part of a redevelopment project to relocate and construct a new facility for the Studebaker National Museum( "Prof ect "), the Commission intends to acquire certain properties, to lease and to take a leasehold interest in certain properties, to undertake certain construction activities related to construction of Project street improvements and other infrastructure improvements at or near the Property; and; WHEREAS, the Commission has heretofore approved and endorsed the Project in accordance with a Memorandum of Understanding dated February 2, 2004, as approved and ratified by the Commission by way of Resolution No. 2061 dated June 4, 2004 and has also appointed the City of South Bend Board of Public Works to act as the Commission's agent in the Project pursuant to Resolution No. 2060 dated June 4, 2004; and WHEREAS, to facilitate the Project, the Commission desires to accept the transfer of property from South Bend Heritage Foundation that will serve as the site for the new Studebaker Museum and to enter into a Ground Lease with respect to the lease of a portion of property owned by the Northern Indiana Historical Society, Inc. that will serve as a connection between the new Studebaker Museum and the Center for History, a copy said Ground Lease is attached hereto and incorporated herein as Exhibit "A "; WHEREAS, the Commission recognizes that time of the essence in order to accomplish certain actions relating to the Project; and WHEREAS, the Commission meets in regular sessions on a semi - monthly basis and completion of the paperwork related to this transaction may require immediate action from the Commission, including the execution of certain documents; and WHEREAS, the Commission believes that it is in the best interests of the public that the Project proceed on schedule and that all necessary approvals be taken in a timely manner. NOW, THEREFORE, BE IT RESOLVED BY THE SOUTH BEND REDEVELOPMENT COMMISSION AS FOLLOWS: 1. The Commission hereby finds that acquisition ofproperty from South Bend Heritage Foundation consistent with the provisions of the Memorandum of Understanding dated February 2, 2004 is reasonable, that the conditions for acceptance of transfer G of this property is necessary to and consistent with the South Bend Central Development Area Development Plan. 2. The Commission hereby approves the form of Ground Lease presented to the Commission at this meeting and authorizes the President of the Commission to execute and the Vice President or Secretary to attest said Ground Lease in the form presented at this meeting with such changes as may be suggested by legal counsel and approved by the President and Vice President or Secretary with such approval evidenced by the execution and attestation, respectively, thereof. 3. The Commission hereby directs and authorizes legal counsel to negotiate and prepare other d ocuments n ecessary t o c arry o ut t he P roj ect a s h eretofore d escribed and approved by the Commission. 4. The Commission hereby authorizes the President of the Commission to execute and the Vice President or Secretary to attest to any and all other documents relating to this Project and to necessary to effect the completion of said Project upon the advice of legal counsel. 5. This Resolution shall be in full force and effect from the and after its passage by the Commission. ADOPTED at a meeting of the South Bend Redevelopment Commission, held on June 18, 2004, at 1308 County -City Building, 227 West Jefferson Boulevard, South Bend, Indiana 46601 SOUTH BEND REDEVELOPMENT COMMISSION B k�ua Its: President Marcia i. Jones ATTEST: By: Its: ecretary Matthew Kahn F:\ HOME \CGREENE \WPData\Projects\SBCDA\ Museum\ Resolutions \ExecutionOiZOCutnents.030615. wpd "1144, C/ GROUND LEASE AGREEMENT THIS GROUND LEASE AGREEMENT (hereinafter referred to as the "Ground Lease ") is made and entered into effective as of , 2004, by and between the NORTHERN INDIANA HISTORICAL SOCIETY, INC., an Indiana not - for - profit corporation ( "Ground Lessor ") and the CITY OF SOUTH BEND, INDIANA, BY AND THROUGH THE SOUTH BEND REDEVELOPMENT COMMISSION ( "Ground Lessee "). A. Ground Lessor is the fee simple owner of a parcel of real estate located in South Bend, St. Joseph County, Indiana, and more particularly described on Exhibit A attached hereto ( "NIHS Property "). B. The South Bend Redevelopment Commission is the governing body of the City of South Bend Department of Redevelopment and, pursuant to Indiana Code § 36 -7 -14 -12.2, is authorized to lease an interest in real property needed for the redevelopment of blighted areas located within the City of South Bend. C. In accordance with IC 36 -7 -14, the Redevelopment Commission is in the process of acquiring a fee simple interest in a parcel of real estate located in the South Bend Central Development Area within the City of South Bend, St. Joseph County, Indiana, and more particularly described on Exhibit B attached hereto ( "Studebaker Property "). L�l D. The Redevelopment pm nt Comrrussron intends to construct a new museum facility on the Studebaker Property and the Redevelopment Commission, as Ground Lessee, intends to lease the new facility to Studebaker National Museum, Inc. ( "SNM ") for operation as the Studebaker National Museum ( "Studebaker Museum "). E. Ground Lessee further desires to connect the Studebaker Museum to the existing museum facility of Ground Lessor that is located on the NIHS Property ( "Center- for History ") consistent with the drawing that is attached hereto as Exhibit C. F. Ground Lessee desires to lease from Ground Lessor a portion of the NIHS Property upon which it intends to construct certain improvements that will serve as the connection between the Studebaker Museum and the Center for History facilities. The improvements to be constructed by Ground Lessee on the NIHS Property will consist of a connecting hallway from the Center for History to the Studebaker Museum ( "Improvement "). The portion of the NIHS Property to be leased for this purpose is specifically described on Exhibit D attached hereto ( "Ground Lease Premises "). G. Subject to the terms and conditions hereinafter set forth, Ground Lessor is willing to ground lease to Ground Lessee the Ground Lease Premises for construction and use of the Improvement. C IN CONSIDERATION, of the mutual covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Ground C4 Lessor and Ground Lessee hereby agree as follows: Section 1. GROUND LEASE PREMISES. Pursuant to the terms hereof, Ground Lessor hereby subleases, grants, demises and transfers over to Ground Lessee the Ground Lease Premises. Section 2. GROUND LESSOR WARRANTIES. Ground Lessor hereby warrants that: (1) Ground Lessor is the lawful holder of fee simple title to the Ground Lease Premises; (ii) Ground Lessor has the full and absolute right to sublease the Ground Lease Premises to the Ground Lessee pursuant to the terms hereof; and (iii) Ground Lessor is a not - for - profit corporation, organized and validly existing under the laws of the State of Indiana. This Ground Lease and all agreements, instruments and documents herein provided to be executed by Ground Lessor have been duly authorized by necessary or appropriate corporate action taken. Section 3. TERM. The term of this Ground Lease shall be for twenty (20) years ( "Term ") commencing on July 1, 2004, (`Commencement Date ") and shall end twenty (20) years after SNM begins use of any of the Shared Use Facilities as that term is defined and used in the Agreement between Northern Indiana Historical Society, Inc., St. Joseph County, Studebaker National Museum, Inc., and the City of South Bend, Inc., dated the 2 "d day of February, 2004, as may be amended, modified or replaced from time to time ( "Shared Use Agreement "), or such earlier date of termination as and if provided for herein or as shall be agreed to in writing by the Ground Lessor and the Ground Lessee, provided that the Term shall automatically terminate without prior notice with the end of the term or termination of Ground Lessee's rights to use the "Shared Use Facilities ". Ground Lessor and Ground Lessee agree to confirm the actual scheduled termination date, based upon the commencement of use as provided for herein, by written certificate in the form attached hereto as Exhibit E ( "Termination Date "). As used herein, the expression "term hereof" or any similar expression refers to the Term. Section 4. USE OF GROUND LEASE PREMISES. 4.1 Compliance with Rules and Regulations. Neither Ground Lessor nor Ground Lessee shall use or permit the Ground Lease Premises to be used contrary to any terms of the Ground Lease or the Shared Use Agreement or in violation of any valid present or future laws. ordinances, rules or regulations of any public governmental authority at any time applicable thereto relating to sanitation or the public health, safety or welfare. 4.2 Use. Ground Lessor has entered into an agreement with Studebaker National Museum, Inc., ( "SNM ") to occupy and operate the Studebaker Museum and to allow SNM to have the use and benefits of the Improvement. Unless otherwise mutually agreed by the parties in writing, Ground Lessee agrees the Studebaker Museum and Improvement will only be used by SNM as a public museum, with purposes generally consistent with those currently served by SNM. 4.3 Severed Title. It is the express intention of Ground Lessor and Ground Lessee that title to the Improvements is and shall remain severed from title to the Ground Lease Premises so long as this Ground Lease is in effect. Section 5. RENTAL. Ground Lessee shall pay to Ground Lessor the sum of One Dollar ($1.00) per annum during the term hereof as rent ( "Rent "), which sum shall be due annually in advance upon execution of the Ground Lease and each anniversary thereof during the term hereof. Ground Lessee shall also pay all of the following: (i) taxes levied upon or assessed against the Improvement during the Tenn; (ii) taxes, assessments, charges and impositions of any municipal or governmental authority which may be imposed or assessed against any of the NIHS Property, including the Ground Lease Premises, as a result of the Improvement, use of the Ground Lease Premises, or any loss of tax exempt status caused by Ground Lessee, SNM or any use of the Improvement or Ground Lease Premises; and (iii) utility charges, including installations, services, repairs and improvements, imposed, assessed or incurred during the Term as a result of the Improvement or Ground Lessee's use of the Ground Lease Premises. Section 6. OWNERSHIP OF IMPROVEMENTS AND SURRENDER OF GROUND LEASE PREMISES. 6.1 Ownership. Ground Lessee shall at all times during the Term have a valid ground leasehold interest in and to the Ground Lease Premises, subject to the terms and conditions contained in this Ground Lease. Upon the expiration of the Term hereof in accordance with Section 2 hereof, or upon a valid termination as provided for herein, Ground Lessee shall be responsible for removing the Improvement and restoring the Ground Lease Premises to the condition existing as of the date of this Agreement or, if approved in writing by the Trustees of Ground Lessor, Ground Lessee may leave the Improvement on the Ground Lease Premises so long as it closes off the same in a permanent way that is acceptable to Ground Lessor. Upon either removal or closing off of the Improvement, Ground Lessee shall use its best efforts to restore the previously existing wall and structural elements of the Ground Lessor's building (interior and exterior) and Center for History so as to cause such facility to be as it existed before the Improvement was built. If the Improvement is left in place and closed off with Ground Lessor's consent and as provided for herein, Ground Lessee's rights in and to the Improvement shall continue so long as Ground Lessee makes rental payments as provided for herein, performs all obligations of Ground Lessee hereunder, and complies with all other terms of this Ground Lease. If the Improvement is closed -3- off with Ground Lessor's consent, Ground Lessee shall pay rent at the rate of One Thousand and no /100 ($1,000.00) Dollars per year thereafter, payable in advance, with such rental rate to increase by three percent (3%) per annum each year thereafter. 6.2 Ground Lessor's Rights. In the event Ground Lessee fails to comply with the terms of Section 6.1 in a timely manner, Ground Lessor shall have included in its remedies the following: (i) The right to declare all rights of Ground Lessee to the Improvement terminated and to then take possession of the Improvement (including all structures, fixtures and improvements) free of any rights of the Ground Lessee; (ii) The right to declare all rights of the Ground Lessee to the Improvement terminated and to demolish the Improvement and restore the Ground Lease Premises and the NIHS Property and Center for History as otherwise provided for in Section 6. 1, with the Ground Lessee being fully responsible for all costs and expenses incurred in connection therewith by the Ground Lessor. In the event of such demolition by Ground Lessor, it shall have no duty or obligation to in any way repair, restore or close off the Studebaker Museum to which the Improvement is connected; and (iii) right ( ) The right to close off the Improvement from the Center for History, with the Ground Lessee being solely responsible for all costs incurred by Ground Lessor for the same, and to continue to treat the Ground Lessee as a tenant at sufferance pursuant to which the Ground Lessee shall be obligated to pay a rental equal to One Thousand Five Hundred Dollars ($1,500.00) per month in advance until Ground Lessee satisfies all obligations under Section 6.1 and 6.2. The payment obligation and receipt of such payments by Ground Lessor shall not limit, waive or qualify Ground Lessor's rights to enforce, at any time, any provisions of the Ground Lease, including the other rights under this Agreement, including those in this Section 6.2 hereof. 6.3 Abandonment. Any personal property owned by Ground Lessee which shall remain on the Ground Lease Premises after expiration of the Term shall, at the option of Ground Lessor, be deemed to have been abandoned and may be retained by Ground Lessor and the same may be disposed of without accountability in such manner as Ground Lessor may see fit. Section 7. GROUND LESSOR'S INTEREST NOT SUBJECT TO CERTAIN LIENS. C1 7.1 Discharging Liens. In the event a lien, claim of lien or order for the payment of -4- money shall be imposed against Ground Lessee's ground leasehold interest in and to the Ground Lease Premises or the Improvement, resulting from or arising out of any act or omission of Ground Lessee, or any person claiming under, by or through Ground Lessee, Ground Lessee shall within thirty (30) days after receipt of notice of the imposition of such lien, claim or order cause the same to be discharged, satisfied, cancelled or released, and the Ground Lease Premises and the Improvement to be released therefrom, by the payment of the obligation secured thereby or by the furnishing of a bond or by any other method which may be prescribed or permitted by law. Ground Lessee shall thereupon furnish Ground Lessor with evidence of having done so in form satisfactory and requisite for recording in the Office of the Recorder of St. Joseph County, Indiana. 7.2 Bonding and Litigation. Notwithstanding the foregoing, should Ground Lessee desire to contest the validity of any lien or claim of lien, nothing herein shall preclude Ground Lessee from doing so, providing that Ground Lessee shall have first either (1) posted an appropriate and sufficient bond in favor of claimant and thereby obtained the release of the Ground Lease Premises and the Improvement from such lien. In such event the Ground Lessee shall indemnify and hold the Ground Lessor harmless from and against any and all claims, actions, lawsuits, costs and expenses of any kind or nature arisinor out of such lien or claim of lien. If judgment is obtained by the claimant of any lien, Ground Lessee agrees to pay the same immediately after such judgment shall have become final and the time for appeal therefrom has expired. Ground Lessee shall, at its own expense, defend the interests of Ground Lessee and Ground Lessor in any and all such suits. Ground Lessor may, at its own expense, engage its own counsel and assert its own defenses, in which event Ground Lessee agrees to cooperate with Ground Lessor and make available to Ground Lessor all information and data deemed by Ground Lessor to be necessary or desirable for such defense. Section 8. INSURANCE. 8.1 Statutory Limitation on Ground Lessee's Liability. Ground Lessee is a municipal corporation that is self - insured under provisions of Indiana statutes and local ordinance. Specifically, Ground Lessee is covered by a non - reverting insurance premium and liability reserve fund created by the City of South Bend, Ordinance #6657 -79, pursuant to Indiana Code 34- 13 -3 -4, as amended from time to time. Under said statute, Ground Lessee's liability is limited to: (a) three hundred thousand dollars ($300,000) for a cause of action that accrues before January 1, 2006; (b) five hundred thousand dollars ($500,000) for a cause of action that accrues on or after January 1, 2006, and before January 1, 2008; or (c) seven hundred thousand dollars ($700,000) for a cause of action that accrues on or after January 1, 2008; and (d) for injury to or death of all persons in that occurrence, five million dollars -5- ($5,000,000); and (e) A governmental entity or an employee of a governmental entity acting within the scope of employment is not liable for punitive damages. The Parties hereto understand and agree that Ground Lessee shall enter into a separate agreement with SNM related to SNM's operation and management of the Studebaker Museum. Ground Lessee hereby agrees that it shall require that SNM carry adequate levels of worker's compensation, property and casualty insurance insuring the Improvement against loss by fire or other casualty and comprehensive general liability insurance, and that the City of South Bend and Ground Lessor be named as additional named insured. Ground Lessee shall require that each insurance policy obtained by SNM pursuant to this provision shall be written by an insurance company or companies licensed to do business in Indiana and shall provide Ground Lessee and Ground Lessor with a certificate evidencing said coverage. Further, any certificate of insurance shall require that written notice of cancellation or material change in the corresponding policy shall be delivered to Ground Lessee and Ground Lessor at least forty -five (45) days in advance of the effective date of the cancellation or material change. Section 9. CONDITIONS OF GROUND LEASE. 9.1 Design. The Improvement shall be constructed consistent with the size, design and materials that have been disclosed and that are described in the plans and specifications of James E. Childs & Associates dated 9.2 Connection. The Ground Lessee shall construct or install and maintain doors in compliance with all building and fire codes at the point where the Improvement meets the existing Center for History so as to separate the Improvement from the Center for History. Such doors shall be capable of being closed and securely locked as deemed appropriate from time to time by SNM and Ground Lessor. 9.3 Operating Costs. Ground Lessee warrants the Improvement has been designed and will be constructed, along with the Studebaker Museum, in such a manner so that there is no increase in operating costs to Ground Lessor in or as a part of its existing facilities as a result of the products of any utility services being in any way diverted, drained, or increased in demand as a result of the Improvement being constructed and connected to the Center for History. 9.4 Repairs. All costs incurred in repairing, restoring and finishing any property of Ground Lessor, including but not limited to any damages of any kind to any of Ground Lessor's improvements and structures (floors, foundation, exterior and interior walls, ceiling, roof, utility equipment and services, landscaping, walkways and parking lots), as a result of any and all construction by Ground Lessee of the Improvement or the Studebaker Museum, the existence or operation of the Improvement or Studebaker Museum, shall be in quality and standard acceptable to Ground Lessor and consistent with the existing building and property design, quality and materials. -6- 9.5 Interruptions. Ground Lessee agrees to cause or a' C, maintain only the minimum amount of interruptions that is reasonably possible to Ground Lessor's operations at its Center for History during all periods of construction of the Improvement and the adjoining of the museum facilities. 9.6 Use. The Improvement and the Studebaker Museum to be constructed by Ground Lessee shall only be used by SNM as a public museum consistent with the provisions and terms of the Shared Use Agreement. Section 10. CONDITION OF GROUND LEASE PREMISES UTILITIES. CONCEALED CONDITIONS. 10.1 Present Condition. Ground Lessee agrees to accept the Ground Lease Premises in their presently existing condition, "As Is ". 10.2 Support. Ground Lessee has determined that the Ground Lease Premises will safely or adequately support the type of improvements desired to be constructed upon Ground Lease Premises, including the Improvement, and that Ground Lessee's construction will not jeopardize the structural integrity of Ground Lessee's existing improvements, and hereby certifies the same to Ground Lessor. 10.3 Utilities. Ground Lessor, at its sole expense, shall bring or cause to be brought to the Ground Lease Premises adequate connections for gas, water, electrical power, storm sewerage and sewerage, and shall arrange with the appropriate utility companies for furnishing such services and shall provide to the Improvement water service and capacity sufficient for operation, heating, ventilation and air conditioning equipment in the Improvement. 10.4 Drains. Drains or other facilities required of or installed by Ground Lessee for the purpose of disposing of storm or other waters shall conform to the requirements of applicable governmental authorities. 10.5 Concealed Conditions. Ground Lessor shall have no responsibility for nor is it assuming any risk of (i) concealed conditions below the surface of the ground encountered in the performance of the construction activity, (ii) unknown physical conditions above or below the surface of the ground, and (iii) latent defects in the Ground Lease Premises. Section 11. LIMITATION ON LEASEHOLD MORTGAGES. ASSIGNMENT AND SUBLETTING. 11.1 No Encumbrance of Fee. Ground Lessee may not enter into a mortgage or mortgages of its interest in the Ground Lease Premises or in the Improvements as security under any financing or refinancing pertaining to the Improvement. 11.2 Assignment and Subletting. Ground Lessee shall not assign this Ground Lease, or -7- any portion thereof or sublease all or any portion of the Ground Lease Premises, or permit any entity other than SNM to operate the Studebaker Museum pursuant to Ground Lessee's rights to the Ground Lease Premises without the prior written consent of Ground Lessor. Except as expressly approved by Ground Lessor in writing, any purported assignment, partial assignment or sublease without Ground Lessor's prior written consent shall be null and void. 11.3 Notice. If Ground Lessee proposes to assign, sublet or transfer any portion of its interest in this Ground Lease, Ground Lessee shall provide written notice in advance to the Ground Lessor containing (i) the names and addresses of the proposed assignee(s), sublessee(s), or transferee(s); (ii) the terms and conditions of the proposed assignment, sublease or transfer; (iii) the nature and character of the business of the proposed assignee, sublessee or transferee; and (iv) general financial information relating to the proposed assignee(s), sublessee(s) or transferee(s). Section 12. TAXES AND FEES. 12.1 Ground Lessor Exempt. Ground Lessor represents and warrants that under current law and determinations, the NIHS Property is exempt from real estate taxes. Should the NIHS Property or the Ground Lease Premises eves- become subject to such taxes, the party responsible for the Ground Lease Premises not being exempt, whether that be Ground Lessor or Ground Lessee (including as a result of any ownership or use of Studebaker Property or the JC Improvement), shall pay any and all such lawful taxes, assessments or charges which at any time may be levied b an federal state county, or an tax or assessment levying body Y Y Y }� Y� Y Y� b Y upon the NIHS Property or the Ground Lease Premises. 12.2 Right to Contest. Notwithstanding the foregoing provision, Ground Lessor shall, after notifying Ground Lessee of its intention to do so, have the right in its own name or behalf, or in the name and behalf of Ground Lessee hereto, to contest in good faith by all appropriate proceedings, the amount, applicability or validity of any such tax or assessment, and in connection with such contest Ground Lessor may refrain from paying such tax or assessment. Ground Lessee shall, upon request by Ground Lessor, assist and cooperate with the other party hereto in any such proceedings at no cost to Ground Lessee. If Ground Lessor desires to contest such tax or assessment it must first post bond satisfactory to Ground Lessee in an amount sufficient to prevent forfeiture or loss of any portion of the Ground Lease Premises. Section 13. EVENTS OF DEFAULT. Each of the following events shall be deemed a default by Ground Lessee hereunder and a breach of this Ground Lease: (1) If Ground Lessee shall fail to pay, when due, any rent or portion thereof within thirty (30) days after receipt of written notice to Ground Lessee by Ground Lessor, or if Ground Lessee shall fail to pay any taxes or assessments or portion thereof, or any other sum which Ground Lessee is obligated to pay under the terms of this Ground Lease, and such taxes, assessments or other sums remain unpaid for a period of thirty (30) days after receipt of written notice to Ground Lessee from Ground Lessor; -8- (ii) If Ground Lessee shall attempt to assign this Ground Lease, or an portion g any or to sublease or permit any use of any portion of the Ground Lease Premises in violation of Section 11.2 hereof; (iii) If any use of the Ground Lease Premises for any purposes not expressly permitted by this Ground Lease, and such use shall continue or reoccur after receipt of written notice to Ground Lessee by Ground Lessor to desist from such use; and (iv) If Ground Lessee shall breach or fail to comply with any term, covenant or condition of this Ground Lease, and such breach or failure to comply shall continue or reoccur after receipt of written notice to Ground Lessee by Ground Lessor to cure; provided, however, in the event such breach or failure to comply cannot, by its nature, be cured immediately, Ground Lessee shall not be deemed to be in default so long as Ground Lessee shall have commenced to cure within twenty (20) days of receipt of notice and thereafter shall prosecute to cure to completion with reasonable diligence, and there is indication satisfactory to Ground Lessor that such will be completed within sixty (60) days following the date of receipt of the notice of breach or failure to cure. Section 14. REMEDIES OF GROUND LESSOR. Upon the occurrence of any of the defaults set forth in Section 13 herein which has not been cured as expressly permitted in Section Ci 13 hereof, Ground Lessor may then, subject to the provisions of Section 6 hereof, terminate Ground Lessee's rights under this Ground Lease upon written notice to Ground Lessee. In the event Ground Lessor elects to avail itself of the rights and remedies contained in Section 6 and /or this Section 14, Ground Lessee shall continue to remain obligated for all amounts due Ground Lessor hereunder and shall further be obligated to pay all expense, including without limitation attorney fees incurred by Ground Lessor as a result of any default by Ground Lessee or as a result of Ground Lessee enforcing any of its rights hereunder. Section 15. NO WAIVERS. No waivers by either party hereto at any time of any of the terms, conditions, covenants or agreements of this Ground Lease, or noncompliance therewith, shall be deemed or taken as a waiver at any time thereafter of the same, nor of any other term, condition, covenant or agreement herein contained, ndr of the strict and prompt performance thereof by the other party thereto. No delay, failure or omission of Ground Lessor to reenter the Ground Lease Premises, nor by either party hereto to exercise any right, power, privilege or option arising from any default shall impair any right, power, privilege or option, or be construed to be a waiver of any such default, relinquishment thereof or acquiescence therein, and no notice by either party hereto shall be required to restore or revive time as being of the essence hereof after wavier by either party of default in one or more instances. No option, right, power, remedy or privilege of either party shall be construed as being exhausted or discharged by the exercise thereof in one or more instances. It is agreed that each and all fo the rights, powers, options or remedies given to each party by this Ground Lease are cumulative, and no one of them shall be exclusive of the other or exclusive of any remedies provided by law. -9- Section 16. QUIET ENJOYMENT. Ground Lessor agrees that Ground Lessee, upon the payment of the rent and all other payments and charges to be aid b Ground Lessee under the terms of this Ground Lease, and observing and keeping the agreements and covenants of this Ground Lease on its part to be observed and kept, shall lawfully and quietly hold, occupy and enjoy the Ground Lease Premises during the term of this Ground Lease, subject to the terms hereof and of the Shared Use Agreement. Section 17. TERMS BINDING UPON SUCCESSORS. All the terms, conditions and covenants of this Ground Lease shall inure to the benefit of and be binding upon the successors and assigns of the parties hereto. Section 18. CONDEMNATION. 18.1 Substantial. In the event that any person or corporation, public or private, shall by virtue of eminent domain or condemnation proceedings, or by purchase in lieu thereof, at any time during the term of this Ground Lease acquire title to the Ground Lease Premises (which for the purposes of this Section only shall include not only the land hereby demised but also the Improvement and other improvements erected thereon by Ground Lessee) or acquire title to such substantial portion thereof that Ground Lessee cannot make use of the residue for the purposes intended by this Ground Lease, such acquisition of title shall terminate this Ground Lease, effective as of the date on which the condemning party takes possession thereof. Ground Lessor and Ground Lessee shall be entitled to separate awards, with Ground Lessor entitled to the fair market value of its fee simple interest in the land condemned and the Ground Lessee entitled to the fair market value of its leasehold interest in the land, including the Improvement. In the event such award(s) are insufficient to adequately cover both parties' interests, the parties shall suffer proportionately the shortage. 18.2 Partial. Prior to completion of construction, if the condemning party acquires title to a portion of the Ground Lease Premises only, and Ground Lessee can make beneficial use of the residue thereof for the purposes intended by this Ground Lease, then this Ground Lease shall continue in full force and effect and the total proceeds of condemnation shall be applied first to compensate the Ground Lessor for the value of the fee simple title, if any, taken by the condemning authority, with the remainder of such proceeds being applied, secondly toward payment of reasonable attorneys' fees and other necessary expenses incurred by the Ground Lessor and the Ground Lessee in connection therewith, and thirdly toward the repair or restoration of the improvements by Ground Lessee in accordance with plans and specifications approved by Ground Lessor which approval shall not be unreasonably withheld or delayed. 18.3 Taking of Improvements. Any taking of any portion of the Improvement shall be deemed substantial hereunder. 18.4 Appeals. It is understood that the foregoing provisions of this Section 16 shall not in any way restrict the right of Ground Lessor or Ground Lessee to appeal the award made by any court or other public agency in any condemnation proceeding. -10- C� Section 19. WASTE. Ground Lessee shall not do, cause, allow or suffer to exist any waste or disfigurement to the Ground Lease Premises, the Improvement, or the NIHS Property, or any part thereof or to any improvements erected on the NIHS Property. Section 20. NON - MERGER OF LEASEHOLD. There shall be no merger of this Ground Lease or of the leasehold estate hereby created with the fee estate in the property described in Exhibit A attached hereto or any part thereof by reason of the fact that the same person may acquire or hold, directly or indirectly, this Ground Lease or leasehold estate hereby created or any interest in this Ground Lease or in such leasehold estate and the fee estate in the property described in Exhibit A attached hereto or any interest in such fee estate. Section 21. RECORDING OF LEASE. This Ground Lease shall be recorded in the office of the Recorder of St. Joseph County, Indiana. Section 22. ESTOPPEL CERTIFICATES. Ground Lessee, at any time and from time to time, upon not less than ten (10) days prior written notice from Ground Lessor, will execute, acknowledge and deliver to Ground Lessor, or to whomsoever it may direct, a certificate of Ground Lessee certifying that this Ground Lease is unmodified (of, if there have been any modifications, identifying the same); that this Ground Lease is in full force and effect, if it is; that there is no default hereunder (or, if so, specifying the default); and such other statements regarding this Ground Lease as Ground Lessee may reasonably request. It is intended that any such certificate may be relied upon by the Ground Lessee or any purchaser from, or assignee or transferee of the Ground Lessor. Section 23. MISCELLANEOUS. 23.1 Laws of Indiana Govern. This Ground Lease shall be governed by, and be construed in accordance with, the laws of the State of Indiana. 23.2 Force Majeure. Except as otherwise expressly provided herein, neither party shall be responsible for any delay in their respective performance called for under this Ground Lease which is caused by acts of God, war, national emergency, labor strike, shortages of material, nor governmental regulations or control not in effect at the time of execution hereof. 23.3 Notice and Delivery. Any notice required to be given hereunder, or any items required or desired to be delivered hereunder, may be served or delivered personally or by certified mail, return receipt requested, postage prepaid, addressed as follows: If to Ground Lessor: President Northern Indiana Historical Society, Inc. 800 W. Washington Street South Bend; IN 46601 with copy to: Andrew W. Nickle, Attorney Nickle & Piasecki -11- 205 W. Jefferson Blvd., Suite 600 South Bend, IN 46601 If to Ground Lessee: South Bend Redevelopment Commission 1200 County -City Building South Bend, IN 46601 with copy to: City Attorney City of South Bend, Dept. of Law 1400 County -City Building South Bend, IN 46601 or such other address or party as the party to be served may direct in by written notice to the other party. If such notice is sent or delivery is made by certified mail, such notice or delivery shall be deemed served, made and effective three (3) business days after posting. 23.4 Entire Agreement. It is mutually acknowledged and agreed by the parties hereto that this Ground Lease contains the entire agreement between Ground Lessor and Ground Lessee with respect to the subject matter of this Ground Lease; that there are no verbal agreements, representations, warranties or other understandings affecting the same; that Ground Lessee, as a material part of the consideration hereof, hereby waives all claims against Ground Lessor for rescission, damages or any other form of relief by reason of any alleged covenants, warranty, representation, agreement or understanding not contained in this Ground Lease; and that any change, modification, release, discharge or wavier of any provision contained herein shall be of no force, effect, or value, unless set forth in writing and signed by the party to be bound. 23.5 Relationship of the Parties. Nothing herein contained shall be deemed to create a partnership or joint venture, nor shall the relationship between the parties be construed as principal and agent, or other than Ground Lessor and Ground Lessee. 23.6 Captions. The captions of this Ground Lease are inserted solely for convenience of reference, and under no circumstances shall they be treated or construed as part of, or as affecting, this Ground Lease. 23.7 Holidays Excluded. For purposes of computing any period of a number of days hereunder for notices or performance (but not for accrual of interest), Saturdays, Sundays and holidays shall be excluded. 23.8 Severability. Any provision of this instrument in violation of the laws of the State of Indiana shall be ineffective to the extent of such violation, without invalidating the remaining provisions of this instrument. In no event shall the Ground Lessee or its assigns have any cause of action against the officers or employees of Ground Lessor, or against any elected official of Ground Lessor based upon or materially related to any finding by any court that any or all provisions of this instrument violate Indiana law. -12- Section 24. CASUALTY. If (i) the Improvement or any portion thereof is destroyed (in whole or in part) or is damaged by fire or other casualty, the Ground Lessor and the Ground Lessee shall be obligated to apply the net proceeds of any insurance proceeds resulting from such event to the prompt repair, restoration, modification or improvement of the Improvement. Section 25. SURVIVAL. The representations, warranties, terms and covenants of this Ground Lease shall survive the termination of the Ground Lease. Section 26. INDEMNIFICATION. Ground Lessee covenants and agrees that it shall defend, indemnify and hold Ground Lessor and Ground Lessor's invitees, employees, successors and assigns harmless from all loss, damage, expense, claims and actions that Ground Lessor or any of Ground Lessor's invitees, guests, employees, successors and assigns may suffer or sustain or be held liable for, arising out of or connected with (i) the construction, repair and maintenance of the Improvement and the Studebaker Museum by Ground Lessee or its employees, agents, contractors and subcontractors; (ii) the occupation or use of the Ground Lease Premises by Ground Lessee or Ground Lessee's invitees, guests, employees, tenants, successors or assigns; or (iii) failure of Ground Lessee to comply with any of its obligations hereunder or any terms or conditions hereof. As part of its Lease and Operating Agreement with SNM, Ground Lessee hereby agrees to require SNM to execute a separate indemnification, the form of which is attached hereto and incorporated herein as Exhibit _, related to SNM's occupancy and use of the Ground Lease Premises. Section 27. DAMAGE TO THE GROUND LEASE PREMISES- HAZARDOUS SUBSTANCES; MUTUAL INDEMNITY. Ground Lessee shall not do, or suffer to be done, in, on or upon the Ground Lease Premises or as affecting said Ground Lease Premises or adjacent properties (including the NIHS Property), any act which may result in damage or depreciation of value to the Ground Lease Premises or adjacent properties, or any part thereof. Ground Lessee shall not generate, store, produce, place, treat, release or discharge any contaminants, pollutants or pollution, including, but not limited to, hazardous or toxic substances, chemicals or other agents on, into, or from the Ground Lease Premises or any adjacent lands or waters in any manner not permitted by law ( "Environmental Condition "). For the purposes of this Ground Lease, "hazardous substances" shall mean and include those elements or compounds defined in 42 USC Section 9601 or which are contained in the list of hazardous substances adopted by the United Sates Environmental Protection Agency (EPA) and the list of toxic pollutants designated by the United States Congress or the EPA or defined by any other federal, state or local statute, law, ordinance, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance, material, pollutant or contaminant ( "Environmental Laws "). "Pollutants" and "pollution" shall mean those products or substances defined in Title 13 of the Indiana Code, and the rules promulgated thereunder, all as amended or updated from time to time. Ground Lessor agrees to indemnify, protect, defend, and hold harmless Ground Lessee from and against any and all losses, damages, liabilities, costs, expenses, and demands suffered fh�or incurred by Ground Lessee as a result of: -13- _ 1. Any and all violations of Environmental Laws or releases of Hazardous Substances, or 2. The presence of Hazardous Substances on the Property (whenever released) as a result of or in connection with the presence, prior to the Commencement Date, of any underground storage tank on the Property. Ground Lessor shall have no obligation to indemnify and hold harmless Ground Lessee for that portion of any Environmental Condition attributable to the activities of Ground Lessee subsequent to the Commencement Date. Ground Lessee agrees to indemnify, protect, defend, and hold harmless Ground Lessor from and against any and all losses, damages, liabilities, costs, expenses, and demands suffered or incurred by Ground Lessor as a result of: 1. Any and all violations of Environmental Laws or releases of Hazardous Substances, or 2. The presence of Hazardous Substances on the Property (whenever released) as a result of or in connection with the presence, after the Commencement Date, of any underground storage tank on the Property. Ground Lessee shall have no obligation to indemnify and hold harmless Ground Lessor for that portion of any Environmental Condition attributable to the activities of Ground Lessor prior to the Commencement Date. Ground Lessee and Ground Lessor's respective obligations set forth in this paragraph shall survive the termination or expiration of this Ground Lease. Nothing herein shall relieve Ground Lessee or Ground Lessor of any responsibility or liability prescribed by law for fines, penalties and damages levied by governmental agencies, and the cost of cleaning up any contamination caused directly or indirectly by Ground Lessee or Ground Lessor's respective activities or facilities. Upon discovery of a release of a hazardous substance or pollutant, or any other violation of local, state or federal law, ordinance, code, rule, regulation, order or decree relating to the generation, storage, production, placement, treatment, release or discharge of any contaminant, Ground Lessee shall report such violation to all applicable governmental agencies having jurisdiction, and to Ground Lessor, all within the reporting periods of the applicable governmental agencies. Ground Lessee shall include a corresponding obligation in its agreements with SNM. Section 28. CONFLICT. REDUNDANCY OF AGREEMENT. In the event that any of the terms, conditions, obligations or restrictions expressed herein are in conflict with or are redundant to any of the terms, conditions, obligations or restrictions expressed in the Shared Use Agreement dated the 2 n day of February, 2004, as may be amended, modified or replaced from -14- •q time to time, the Shared Use Agreement shall prevail. IN WITNESS WHEREOF, Ground Lessor and Ground Lessee have caused this Ground Lease to be executed in duplicate, either of which may be considered an original, the day and year first above written. GROUND LESSOR: NORTHERN INDIANA HISTORICAL SOCIETY, INC. Its: GROUND LESSEE: SOUTH BEND REDEVELOPMENT COMMISSION By: Its: ATTEST: By: Its:. OR -15-