HomeMy WebLinkAboutResolution No. 3282 Agreements and Documents Concerning the Hotel LaSalle Development ProjectRESOLUTION NO. 3282
A RESOLUTION OF THE SOUTH BEND REDEVELOPMENT COMMISSION
REGARDING CERTAIN AGREEMENTS AND DOCUMENTS CONCERNING THE
HOTEL LASALLE DEVELOPMENT PROJECT
WHEREAS, the South Bend Redevelopment Commission (the "Commission"), the
governing body of the South Bend, Indiana, Department of Redevelopment (the "Department")
and of the Redevelopment District of the City of South Bend, Indiana (the "Redevelopment
District"), exists and operates under the provisions ofl.C. 36-7-14, as amended from time to time
(the "Act"), and is a body corporate and politic; and
WHEREAS, on November 24, 2014, the Commission entered into a Development
Agreement (the "Development Agreement") with RealAmerica Development LLC (the
"Developer") relating to the redevelopment of the real property and improvements commonly
known as Hotel LaSalle (the "Property"); and
WHEREAS, the Development Agreement provides that the Commission will convey the
Property to the Developer at closing (the "Closing") upon the satisfaction of certain conditions
and that the Commission and the Developer will grant certain easements and enter into certain
agreements to advance the redevelopment of the Property; and
WHEREAS, the Developer has assigned certain of its rights and obligations under the
Development Agreement to its affiliated entities as set forth in a certain Assignment And
Assumption Agreement dated MAf<.CH ~ , 2015 (the "Assignment Agreement," attached
hereto as Exhibit A); and
WHEREAS, pursuant to the Development Agreement and consistent with the
Assignment Agreement, the following instruments have been prepared for the Commission's
approval and present execution: (1) Quit Claim Deed, pursuant to Section 3 .2 of the
Development Agreement, in favor of The LaSalle Apartments, LLC (attached hereto as Exhibit
B); (2) Temporary Construction Easement Agreement, pursuant to Section 5.3(a) of the
Development Agreement, with The LaSalle Apartments, LLC (attached hereto as Exhibit C); (3)
Construction Management Agreement, pursuant to Section 6.1 of the Development Agreement,
with RealAmerica Development LLC, RealAmerica Construction, LLC, The LaSalle
Apartments, LLC, and RealAmerica Funding Corporation (attached hereto as Exhibit D); ( 4)
Option And Right Of First Refusal Agreement,. pursuant to Sections 6.2 and 6.3 of the
Development Agreement, with The LaSalle Apartments, LLC (attached hereto as Exhibit E)
(collectively, the "Commission's Closing Documents"); and
WHEREAS, pursuant to Section 5.3(b) of the Development Agreement, a form oflease
agreement providing for the lease of the Support Parcel and the Parking Lot (both, as defined in
the Development Agreement) by the Commission to the Developer (the "Parking Lease,"
attached hereto as Exhibit F) has been prepared for the Commission's approval and later
execution, in accordance with the terms of the Development Agreement; and
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WHEREAS, in connection with the Developer's redevelopment of the Property, the
Developer may seek the Commission's approval or non-remonstrance of the Developer's historic
preservation plans for the Property and application( s) for historic preservation tax credits related
thereto; and
WHEREAS, the Commission desires (a) to approve the Commission's Closing
Documents and the form of Parking Lease and (b) to authorize certain Redevelopment staff
members to take the necessary actions to conduct the Closing and to approve the Developer's
historic preservation plans for the Property.
NOW, THEREFORE, BE IT RESOLVED BY THE SOUTH BEND
REDEVELOPMENT COMMISSION AS FOLLOWS:
1. The Commission approves the Commission's Closing Documents, as identified
in this Resolution.
2. The Commission approves the form of Parking Lease attached hereto as Exhibit
F, to be executed by the Commission at a later date in accordance with the terms of the
Development Agreement.
3. The Commission authorizes the following staff members to take any actions and
execute any documents necessary to consummate the Closing of the sale of the Property to the
Developer: Brock Zeeb or David Relos.
4. To the extent the Commission's approval or non-remonstrance is sought by any
federal, state, or local agency or body to which the Developer has submitted historic preservation
plans and applications, the Commission authorizes the following staff member, in consultation
with the Design Review Committee, as required, to review and approve such plans and
applications: David Relos.
5. This Resolution shall be in full force and effect upon its adoption.
ADOPTED at a meeting of the South Bend Redevelopment Commission held on March
26, 2015, at 227 West Jefferson Boulevard, Room 1308, South Bend, Indiana 46601.
CITY OF SOUTH BEND,
J~P ARTMENT OF DEVELOPMENT
(//tu~~-:
Signature
Marcia I. Jon
Printed Name and Title
South Bend Redevelopment Commission
2
Donald E. Inks, Secretary
Printed Name and Title
South Bend Redevelopment Commission
3
EXHIBIT A
Assignment And Assumption Agreement
ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Agreement") is made
and entered into as of $-a,rc/., .?fc, 2015 (the "Effective Date"), by and among
REALAMERICA DEVELOPMENT, LC, an Indiana limited liability company (''Assignor"),
THE LASALLE APARTMENTS, LLC, an Indiana limited liability company ("LaSalle"),
REALAMERICA CONSTRUCTION, LLC, an Indiana limited liability company ("RealAmerica
Constl'Uction"),
and REALAMERICA FUNDING CORPORATION, an Indiana corporation
("RealAmerica
Fimding" and being hereinafter referred to together with LaSalle and
RealAmerica Construction as the "Assignees").
RECITALS:
WHEREAS, Assignor, as developer, entered into that certain Development Agreement
dated November 24, 2014 (the "Development Agreement"), with the South Bend Redevelopment
Commission,
governing body of the South Bend Depa1iment of Redevelopment
ecommission"), in connection with Assignor's development of a mixed-use residential and
retail rental project to be located in South Bend, Indiana, commonly referred to as The LaSalle
(the "Project");
WHEREAS, each of the Assignees is an entity affiliated with Assignor; and
WHEREAS, to assist Assignor in developing the Project, Assignor desfres to assign to
the Assignees, and the Assignees desire to assume from Assignor, certain of Assignor's rights,
interests, duties, liabilities and obligations undel' the Development Agreement as set forth in this
Agreement.
AGREEMENT:
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual promises
and undertakings in this Agreement, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Assignor and the Assignees hereby agree as
follows:
1. Recitals. The recitals set forth above are hereby incorporated as representations by the
parties hereto, as if fully set forth herein.
2.
Definitions. All capitalized terms used but not otherwise defined in this Agreement shall
have the meanings ascribed to such terms in the Development Agreement.
3. Assignments and Assumptions.
a. Fee Ownership of Project. Assignor hereby assigns to LaSalle all of its rights,
interests, duties, liabilities and obligations under the Development Agreement
with respect to the acquisition and ownel'ship of the LaSalle Property including,
without limitation, all of Assignor's rights, interests, duties, liabilities and
obligations with respect to construction of the Local Public Improvements, and
LaSalle hereby assumes and agrees to perform all such assigned rights, interests,
{20150549.DOCX}
duties, liabilities and obligations of Assignor.
b. Constmction Management. Assignm hereby assigns to RealAmerica
Construction all of its rights, interests, duties, liabilities and obligations under the
Development Agreement with respect to construdtion management of the Project
including, without limitation, management of the construction of the Local Public
Improvements, but excluding tt1ose certain rights, interests, duties, liabilities and
obligations of Assignor assigned to RealAmerica Funding pursuant to Section
3(c) below, and ReaIAmerica.Constmction hereby assumes and agrees to perform
all such assigned rights, interests, duties, liabilities and obligations of Assignor.
c. Funding. Assignor hereby assigns to RealAmerica Funding alt of its rights,
interests, duties, liabilities and obligations under the Development Agreement
with respect to management of the Funding Amount proceeds for the benefit of
LaSalle (as assignee of those certain rights, interests, duties, liabilities and
obligation·s of Assignor as set forth in Section 3(a) above) including, without
limitation, receiving such proceeds from Commission for the benefit of LaSalle
and transmitting the same to LaSalle or directly to General Contractors, as may be
applicable, in order to pay the costs of construction of the Local Public
Improvements, and RealAmerica Funding hereby assumes and agrees to perform
all such assigned rights, interests, duties, liabilities and obligations of Assignor.
4. Representations and Warranties. Assignor represents and warrants to the Assignees as
follows: (i) all obligations of the Assignor under the Development Agreement to be
performed by Assignor prior to the Effective Date have been fully pe1formed and
satisfied; (ii) there is no default by Assignor existing under the Development Agreement;
(iii) the Development Agteement remains in full force and effect, has not been further
amended and has not been previously assigned in whole or in patt by Assignor; and (iv)
Assignor has provided each of the Assignees with a tme and complete copy of the
Development Agreement.
5. Applicable Law. The parties intend that this Agreement shall be governed by and
construed in accordance with the laws of the State of Indiana.
6. Successors. This Agreement shall inure to the benefit of, be binding upon, and be
enforceable by and against the parties hereto, thefr heirs, executors, administrators,
successors and assigns.
7. Third Party Beneficiary. Assignor and Assignees acknowledge that Commission is a
third-party beneficiary of this Agreement. The various assignments and assumptions of
rights and obligations by Assignor and Assignees under this Agreement are intended to
benefit Commission through the satisfaction of all Assignor's responsibilities under the
Development Agreement.
8. Counterparts; Electronic Transmission. This Agreement may be executed in
counterpatis which, when combined, shall constitute one instrument. An executed
counterpart copy of this Agreement transmitted by facsimile or by electronic mail shall
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be effective as an original counterpart hereof.
9. Entire Agreement. This Agreement constitutes the entire understanding between the
parties with respect to the subject matter hereof.
[Signature Page Follows.]
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IN WITNESS WHEREOF, Assignor and the Assignees have caused this Assignment and
Assumption Agreement to be executed as of the Effective Date.
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"ASSIGNOR":
REALAMERICA DEVELOPMENT, LLC, an Indiana
limited liability company
B 1L-( ...
y: __ ---....':.,_Jt'~'-· ___________ ____,_ __ _
Ronda Shrewsbul'y Weybright, President
"ASSIGNEES":
THE LASALLE APARTMENTS, LLC, an Indiana limited
liability company
By: Executive Investments, LLC, its Member
(__/>~
By: ~~~~----=-~~~~~~~~~~
Ronda Shrewsbury W eybright, President
REALAMERICA CONSTRUCTION, LLC, an Indiana
limited liability company
By: REALAMERICA DEVELOPMENT, LLC, its
Member
Ronda Shrewsbury Weybright, Pi·esident
REALAMERICA FUNDING CORPORATION, an
Indiana corporation
By: __ ~__:..:_____----~
Ronda Shrewsbury Weybright, President
EXHIBITB
Quit Claim Deed
RETURN TO:
SOUTH BEND REDEVELOPMENT
COMMISSION
1400 S. COUNTY-CITY BUILDING
227 W. JEFFERSON BL VD.
SOUTH BEND, IN 46601
AUDITOR'S RECORD
TRANSFER NO. ___ _
TAXING UNIT -----
DATE ______ _
KEY NO. -------
QUIT CLAIM DEED
THIS INDENTURE WITNESS ETH, that the City of South Bend, Department of Redevelopment,
by and through its governing body, the South Bend Redevelopment Commission, 1400 S.
County-City Building, 227 W. Jefferson Boulevard, South Bend, Indiana (the "Grantor")
CONVEYS AND QUIT CLAIMS to The LaSalle Apartments, LLC, an Indiana limited liability
company, having its principal place of business at 10711 America Way, Suite 200, Fishers,
Indiana 4603 8 (the "Grantee"),
for and in consideration of One Dollar ($1.00) and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the real estate in St. Joseph County,
Indiana, described in Exhibit A, attached hereto and made a part hereof (the "Property").
The undersigned persons executing this Quit Claim Deed (the "Deed") represent and certify that
each is competent and fully empowered to execute and deliver this Deed on behalf of the Grantor;
that the Grantor has full legal capacity to convey the Property; and that all necessary action
necessary to complete this conveyance has been duly taken.
The Grantor hereby conveys the Property to the Grantee, as the assignee of certain rights and
obligations of RealAmerica Development, LLC under the Development Agreement between the
Grantor and RealAmerica Development, LLC dated November 24, 2014 (the "Development
Agreement"). Capitalized terms not otherwise defined in this Deed shall have the meanings set
forth in the Development Agreement. In the event any of the terms, conditions, obligations, or
restrictions herein conflict with those contained in the Development Agreement, the terms,
conditions, obligations, and restrictions of the Development Agreement, when read together as a
whole, shall prevail.
The Grantor hereby conveys the Property to the Grantee subject to the covenants, conditions,
restrictions, and provisions stated in the Development Agreement and the following:
Page 1of4
1. Applicable building codes and zoning ordinances.
2. Any and all other covenants, restrictions, easements, and reservations of record.
This Deed is subject to the condition that Grantee must reach Substantial Completion of the
Project within thirty-six (36) months of the date of this Deed. If the Grantee fails to meet
Substantial Completion of the Project within thirty-six (36) months of the date of this Deed,
thereafter, unless construction work of a material nature has resumed and is continuing without
interruption for prompt Substantial Completion, the Grantor may re-enter and take possession of
the Property and terminate and cause title to the Property to be surrendered by the Grantee and
revested in the Grantor, provided that any such revesting (or conveyance to the Grantor) shall
always be subject to and limited by, and shall not defeat, render invalid, or limit in any way, the
lien of any mortgage on the Property for the purpose of securing any financing obtained by the
Grantee to complete the Project and shall not apply to individual parts of the Property (or in the
case of parts sold or lease, the part so conveyed), if any, on which the construction thereon has
been completed in accordance with the Development Agreement.
Page 2of4
ATTEST:
Signature
Printed Name and Title
GRANTOR
CITY OF SOUTH BEND,
DEPARTMENT OF REDEVELOPMENT
Signature
Printed Name and Title
South Bend Redevelopment Commission
South Bend Redevelopment Commission
STATE OF INDIANA
ST. JOSEPH COUNTY
)
) SS:
)
Before me, the undersigned, a Notary Public, in and for said County and State, personally
appeared and , known to me to be the
and respectively of the South Bend
Redevelopment Commission and acknowledged the execution of the foregoing Quit Claim Deed.
IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed my official
seal on the __ day of , 2015.
My Commission Expires:
Notary Public
Residing in St. Joseph County, Indiana
I affirm, under the penalties for perjury, that I have taken reasonable care to redact each Social Security number in this document,
unless required by law. Benjamin J. Dougherty.
This instrument was prepared by Benjamin J. Dougherty, Assistant City Attorney, 1200 S. County-City Building, 227 W. Jefferson
Blvd., South Bend, Indiana 46601.
Page 3of4
EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
A part of the West half of the Northwest Quarter of Section 12, T. 37 N., R. 2 E. Also known as
Lot #1 in the recorded plan of the Original Plat of the Town, Now City of South Bend Portage
Township, City of South Bend, St. Joseph County, Indiana. [Generally referred to as Parcel Key
No. 018-1002-0040]
Page 4of4
EXHIBITC
Temporary Construction Easement Agreement
TEMPORARY CONSTRUCTION EASEMENT AGREEMENT
THIS TEMPORARY CONSTRUCTION EASEMENT AGREEMENT (this
"Agreement") is made effective as of the __ day of , 2015 (the "Effective
Date"), by and between SOUTH BEND REDEVELOPMENT COMMISSION, governing body
of the South Bend Department of Redevelopment ("Grantor"), and THE LASALLE
APARTMENTS, LLC, an Indiana limited liability company ("Grantee," and together with Grantor
are sometimes referred to herein together as the "Parties").
RECITALS:
WHEREAS, Grantor entered into that certain Development Agreement dated November
24, 2014 (the "Development Agreement"), with RealAmerica Development, LLC, an Indiana
limited liability company ("RealAmerica Development"), as developer, in connection with the
development of a mixed-use residential and retail rental project commonly referred to as The
LaSalle Apartments (the "Project") to be located upon that certain real estate situated in St. Joseph
County, Indiana, and described on Exhibit A attached hereto and made a part hereof (the "LaSalle
Property");
WHEREAS, pursuant to that certain Assignment and Assumption Agreement dated as of
______ , 2015, executed by and among RealAmerica Development, Grantee and certain
other entities, RealAmerica Development assigned, and Grantee assumed, certain of RealAmerica
Development's rights, interests, duties, liabilities and obligations under the Development
Agreement with respect to development of the Project;
WHEREAS, Grantee is the owner of the LaSalle Property;
WHEREAS, Grantor is the owner of that certain real estate located in St. Joseph County,
Indiana, and described on Exhibit B attached hereto and made a part hereof (the "Support Parcel");
WHEREAS, Section 5.3(a) of the Development Agreement provides that, in connection
with development of the Project, Grantor shall provide all reasonable access to and use of the
Support Parcel for construction staging, storage and related activities; and
WHEREAS, pursuant to said Section 5.3(a) of the Development Agreement, Grantor
desires to grant, and Grantee desires to obtain, a temporary construction easement upon, over,
through and across the Support Parcel upon the terms and conditions set forth in this Agreement.
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AGREEMENT:
NOW, THEREFORE, in consideration of the mutual promises and agreements and other
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties
do hereby agree as follows:
Section 1. Easement. To facilitate Grantee's development of the Project, Grantor
hereby grants unto Grantee an exclusive easement (the "Easement") to enter upon, over, and across
the Support Parcel for the purposes of storing machinery, placing construction trailers, parking for
construction workers, staging and storing materials (subject to Section 4 below) and equipment for
construction and such other activities related to Grantee's development of the Project. This
Agreement and the Easement granted herein shall be temporary and shall terminate upon the earlier
to occur of: (a) completion of the development of the Project; (b) twenty (20) months after the
Effective Date; ( c) expiration or earlier termination of the Development Agreement; or ( d) such
earlier date as Grantor and Grantee may agree to in writing. In addition to the provisions of the
foregoing sentence, this Agreement will terminate on the date that is forty-five (45) days after the
Effective Date if Grantee has not commenced construction of the Project by such date. Grantee
hereby covenants and agrees to place, at Grantee's sole expense, temporary chain-link fencing, at
least six ( 6) feet in height, around the Support Parcel or the portions thereof utilized by Grantee as
may be reasonably requested by Grantor in order to reduce the risk of public endangerment
resulting from the activities being performed by or on behalf of Grantee thereon in connection with
development of the Project.
Section 2. Nature of Easement. The Easement granted herein, and its associated
benefits, covenants and obligations, shall (i) inure to the benefit of Grantee and Grantee's
contractors, affiliates and agents acting on Grantee's behalf in connection with development of the
Project, (ii) run with the land for the benefit of the LaSalle Property and (iii) be binding upon
Grantor and every person or entity now or hereafter having any fee, leasehold, or other interest in
all or any part of the Support Parcel.
Section 3. Maintenance. Grantee, at Grantee's sole expense, will maintain the Support
Parcel in good condition and repair throughout the term of this Agreement and, upon the
termination of this Agreement, will repair or replace any elements of the Support Parcel necessary
to restore the Support Parcel to the same condition as existed on the Effective Date.
Section 4. Compliance with Law; Release. Grantee shall comply with all applicable
rules, regulations, ordinances and laws in connection with the exercise of its rights hereunder.
Grantor hereby releases any and all claims from whatsoever cause, incidental to the exercise of
any rights herein granted, except for damage to Grantor caused by the intentional or negligent act
or omission of Grantee, its agents, employees, or licensees. Notwithstanding anything to the
contrary in this Agreement, Grantee hereby agrees that any hazardous materials stored on the
Support Parcel shall be stored in compliance with applicable law and (i) such materials will be
subject to inspection by Grantor upon reasonably advance written request and will be removed if
they are not properly contained and stored in accordance with applicable laws, (b) Grantee will be
responsible for cleaning up any spills, leakages, or releases of any such hazardous materials to the
extent required by applicable law, and ( c) Grantee will indemnify the Grantor for any liability
arising as a result of Grantee's storage of any such hazardous materials on the Support Parcel.
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Section 5. Use by Grantor. Grantor reserves the right to use and enjoy the Support
Parcel for all purposes not inconsistent with the permitted uses thereof by Grantee, its successors
and assigns; provided, that, Grantor shall not construct or place or permit to be constructed or
placed, any structure or obstruction on the Support Parcel that will unreasonably prevent or
interfere with Grantee's use of the Support Parcel for the purposes permitted herein.
Section 6. Severability. The invalidity or unenforceability of any covenant, condition,
term or provision in this Agreement shall not affect the validity and enforceability of any other
covenant, condition, term or provision of this Agreement.
Section 7. Governing Law; Dispute Resolution. The conditions, terms and provisions
of this Agreement shall be governed by and construed in accordance with the laws of the State of
Indiana. Any legal proceeding in relation to a dispute under this Agreement will be commenced
in the courts of St. Joseph County, Indiana, and the parties hereby waive any right to trial by jury
in any such legal proceeding.
Section 8. Section Headings. The Section headings are included only for convenience,
and shall not be construed to modify or affect the covenants, terms or provisions of any Section.
Section 9. Attorney Fees. In the event that it shall be necessary for either party to
retain an attorney to enforce the obligations of the other party hereunder, the prevailing party shall
be entitled to recover from the other party all reasonable attorneys' and paralegal fees and expenses
incurred in connection therewith.
Section 10. Last Deed of Record. The most recent deed of record relative to the Support
Parcel is recorded as Instrument No. 0414076 in the Office of the Recorder of St. Joseph County,
Indiana.
Section 11. Authority. The undersigned person executing this Agreement on behalf of
Grantor represents and certifies that he or she has full capacity to convey the Easement and other
rights herein, and all necessary action for the making of such Easement has been taken and done.
The undersigned person executing this Agreement on behalf of Grantee represents and certifies
that she has been fully empowered to execute and deliver this Agreement, and that all necessary
action for the execution of this Agreement has been taken and done.
Section 12. Insurance. Grantee will maintain insurance, in the kinds and amounts stated
in Exhibit E to the Development Agreement, in connection with its use of the Support Parcel under
this Agreement and will name Grantor as an additional insured under all such insurance policies.
[Signature Page Follows.]
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
Effective Date.
STATE OF INDIANA )
) SS:
COUNTY OF ST. JOSEPH )
"GRANTOR":
SOUTH BEND REDEVELOPMENT
COMMISSION, governing body of the South Bend
Department of Redevelopment of the City of South
Bend, Indiana
Printed: ______________ _
Title:
---------------~
Before me, the undersigned, a Notary Public in and for said State, personally appeared
and , known by me to be the
______ and , respectively, of Grantor in the foregoing Temporary
Construction Easement Agreement, and who, in such capacity, acknowledged the execution of the
same as Grantor's free and voluntary act and deed.
WITNESS my hand and Notarial Seal this ___ day of ______ ., 2015.
_________ ,Notary Public
Residing in ______ County, IN
My Commission Expires: _________ _
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STATE OF INDIANA )
) SS:
COUNTY OF ______ )
"GRANTEE":
THE LASALLE APARTMENTS, LLC, an Indiana
limited liability company
By: Executive Investments, LLC, its Member
By:
Ronda Shrewsbury Weybright, President
Before me, the undersigned, a Notary Public in and for said State, personally appeared
Ronda Shrewsbury W eybright, known by me to be the President of the Executive Investments,
LLC, an Indiana limited liability company, being the sole member of Grantee in the foregoing
Temporary Construction Easement Agreement, and who, in such capacity, acknowledged the
execution of the same as Grantee's free and voluntary act and deed.
WITNESS my hand and Notarial Seal this ___ day of ______ , 2015.
_________ ,Notary Public
Residing in ______ County, IN
My Commission Expires: __________ _
This instrument was prepared by Kenneth B. Chigges, Esq., Kuhl & Grant LLP, 707 E. North Street, Suite 800,
Indianapolis, Indiana 46202.
I affirm, under the penalties for perjury, that I have taken reasonable care to redact each Social Security number in
this document, unless required by law. --Kenneth B. Chigges, Esq.
{20150553.DOCX}
EXHIBIT A
LASALLE PROPERTY
A part of the West half of the Northwest Quarter of Section 12, Township 37 North, Range 2 East,
also known as Lot #1 in the recorded plan of the Original Plat of the Town (now City) of South
Bend Portage Township, City of South Bend, St. Joseph County, Indiana. [Parcel Key No. 018-
1002-0040]
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EXHIBITB
SUPPORT PARCEL
A part of the West half of the Northwest Quarter of Section 12, Township 37 North, Range 2 East,
also known as Lots #2 and #3 in the recorded plan of the Original Plat of the Town (now City) of
South Bend Portage Township, City of South Bend, St. Joseph County, Indiana. [Parcel Key Nos.
018-1002-0041 and 018-1002-0042]
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B-1
EXHIBITD
Construction Management Agreement
CONSTRUCTION MANAGEMENT AGREEMENT
THIS CONSTRUCTION MANAGEMENT AGREEMENT (this "Agreement") is made
and entered into on , 2015, by and between the South Bend
Redevelopment Commission ("Redevelopment Commission"), the South Bend Board of Public
Works ("Board of Works") (collectively, "City"), RealAmerica Development, LLC, an Indiana
limited liability company ("Developer"), RealAmerica Construction, LLC, an Indiana limited
liability company ("Manager"), The LaSalle Apartments, LLC, an Indiana limited liability
company ("Owner"), and RealAmerica Funding Corporation, an Indiana corporation ("Funding").
RECITALS
WHEREAS, Redevelopment Commission and Developer have entered into a Development
Agreement, dated November 24, 2014 (the "Development Agreement"), relating to the
development of a mixed-use project to be located in South Bend, Indiana, and commonly referred
to as The LaSalle (the "Project");
WHEREAS, each of Manager, Funding and Owner are an affiliate of Developer (as such
term is used in Section 10.12 of the Development Agreement);
WHEREAS, without relieving itself of any of its obligations to Redevelopment
Commission under the Development Agreement, Developer has assigned certain of its rights,
interests, duties, liabilities and obligations under the Development Agreement to Owner, Manager
and Funding pursuant to the Assignment and Assumption Agreement dated as of
_________ , 2015, and Owner, Manager and Funding have each assumed the
respectively assigned rights, interests, duties, liabilities and obligations of Developer thereunder;
WHEREAS, pursuant to the terms of the Development Agreement, Owner has acquired,
or shall acquire, fee simple title to the Project;
WHEREAS, as the owner of fee simple title to the Project, Owner shall benefit from the
completion of the Local Public Improvements to be paid for with the Funding Amount proceeds
(as such terms are defined in the Development Agreement); and
WHEREAS, in order to expedite the process and assist Developer and Owner in
completing the project on time, Redevelopment Commission and Board of Works have agreed to
appoint Manager as Redevelopment Commission's construction manager and agent for the
purpose of managing the design, construction, and equipping of the Local Public Improvements
(as defined in the Development Agreement).
NOW, THEREFORE, in consideration of the mutual promises, representations, warranties,
covenants, and responsibilities, Redevelopment Commission, Board of Works, Developer,
Manager, Funding and Owner agree as follows:
ARTICLE I. AUTHORITY TO EXECUTE AGREEMENT
Each party represents and warrants to the other parties that:
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1.1. The party is duly formed, organized or incorporated, as applicable, and is validly existing
under the laws of Indiana.
1.2. The party has the power, authority, and legal right to enter into and perform its obligations
set forth in this Agreement, and the execution, delivery, and performance whereof, have
been duly authorized by all necessary action.
1.3. This Agreement has been duly entered into and delivered and constitutes a legal, valid, and
binding obligation of the party, enforceable in accordance with its terms.
ARTICLE II. DEFINITIONS
2.1. Capitalized terms not otherwise defined herein shall have the meaning assigned to them in
the Development Agreement. In addition to terms defined elsewhere in this Agreement,
the following terms, for the purpose of this Agreement, shall have the meanings set forth
below:
"Construction Management Services" means the preparation of plans and specifications
for the Local Public Improvements, the preparation of all necessary bid documents and
legal advertisements, the scheduling of and participation in any pre-bid meetings, the
reviewing of bids and making of recommendations with regard to the award of bids, the
supervision and monitoring of the construction of the Local Public Improvements,
including establishing the timing, sequence, and phasing of construction of the Local
Public Improvements, the inspection of construction by the General Contractors, the
coordination of, progress payment review with respect to, and approval of contracts for the
General Contractors, and the recommendation and administration of change orders in the
manner described by this Agreement, which responsibilities shall include overseeing the
delivery of the Local Public Improvements in substantial accordance with the plans and
specifications as contemplated by the Development Agreement.
"General Contractors" means the contractors, including but not limited to their respective
sub-contractors, vendors and suppliers, who shall construct and complete the Local Public
Improvements.
ARTICLE III. INTENT AND INTERPRETATION
3 .1. The "Agreement," as referred to herein, shall mean this Construction Management
Agreement executed by Redevelopment Commission, Board of Works, Developer,
Manager, Funding and Owner and shall include any written supplemental agreement or
modification entered into between Redevelopment Commission, Board of Works,
Developer, Manager, Funding and Owner, in writing, after the date of this Agreement.
3 .2. This Agreement shall include, and incorporate by reference, any applicable provision,
covenant or condition required by law or by regulation of any state or federal regulatory or
funding agency to be included herein.
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2
ARTICLE IV. CONSTRUCTION MANAGEMENT
4.1. City hereby designates Manager as City's construction manager for the purpose of granting
to Manager, to the fullest extent permitted by law, the responsibility and authority to act as
the agent for and on behalf of City to provide the Construction Management Services and
granting unto Manager the sole and exclusive responsibility and authority to manage the
design, construction, and equipping by the General Contractors of the Local Public
Improvements in accordance with the terms set forth herein.
4.2. As compensation for Manager's services under this Agreement, Manager shall be entitled
to a construction management fee in an amount equal to One Hundred Seventy One
Thousand Dollars ($171,000.00).
4.3. City and Manager acknowledge and agree that the Local Public Improvements will be
designed and constructed in a manner consistent with applicable laws, including but not
limited to any applicable competitive bidding requirements. Manager, in consultation with
its design and other professionals, will prepare bid packages for the solicitation of bids
from independent contractors to construct the Local Public Improvements. The bid
packages shall include plans and specifications as contemplated by the Development
Agreement. Construction of the Local Public Improvements can either be bid as one
package or as several packages, as determined by Manager consistent with applicable law.
All bid packages shall be in a form consistent with other bid packages and legal
advertisements used by Board of Works, with such modifications as Manager may request,
subject to approval by Board of Works, which approval shall not be unreasonably withheld,
conditioned or delayed. Manager shall be responsible for scheduling and participating in
pre-bid meetings with potential bidders and responding to any questions submitted by
bidders with regard to the bid packages, and issuing any addenda to bid packages.
4.4. Manager, with City's cooperation, shall be responsible for scheduling the publication of
legal advertisements and receipt of bids at regularly scheduled meetings of Board of
Works. All bids shall be received and opened publicly, pursuant to applicable law. City
shall deliver copies of all bid proposals to Manager at or promptly after the public opening.
Manager and City shall review the proposals and make recommendations with the intent
to award contracts in accordance with applicable laws to the lowest responsible and
responsive bidder at a public meeting, provided such bid has been submitted in accordance
with all applicable laws and meets the requirements of the bidding documents. City, in
consultation with Manager, shall have the right to reject any and all bids not in compliance
with applicable law and City's requirements.
4.5. Manager shall prepare the form of any construction contract(s) to be entered into in
connection with construction of the Local Public Improvements; provided, that such
construction contract(s) shall include all provisions required by applicable law and other
standard provisions included in construction contracts used by Board of Works and which
construction contracts shall be subject to review and approval by Board of Works.
4.6. Notwithstanding anything contained in this Article IV, it is agreed that all procedures
followed in connection with the solicitation of bids, the awarding of contracts and all
{20150101.DOCX}
3
related activities must conform to all requirements of applicable law. All provisions of this
Article IV are conditioned upon the procedures described herein being consistent with
applicable laws, and shall be followed only if consistent therewith.
4.7. Manager hereby is granted and shall have, as agent for and on behalf of City, total and
exclusive responsibility and authority to perform the Construction Management Services
and to manage and supervise the design, construction, and equipping of the Local Public
Improvements, except for the award of contracts by Board of Works, at the direction of
Manager. Manager acknowledges that the Local Public Improvements will be constructed
in substantial accordance with the plans and specifications as contemplated by the
Development Agreement. Manager shall schedule, coordinate, and monitor the work of
the design professionals, engineers, consultants, General Contractors relating to the Local
Public Improvements, including but not limited to establishing the timing, sequence, and
phasing of construction of the Local Public Improvements.
4.8. In accordance with applicable law, Manager shall have discretion and authority to initiate
the implementation of change orders. Manager shall be responsible for preparing and
processing any such change orders for review and approval by Board of Works.
4. 9. Manager hereby agrees to provide notice to local contractors of all request for bids, of pre-
bid meetings and of related meetings and information with respect to the Local Public
Improvements so as to use commercially reasonable efforts to employ qualified local
contractors and other related local labor during construction of the Local Public
Improvements. Manager agrees to provide the details of the Local Public Improvements
to the business agents of all skilled trade unions prior to contracting for the completion of
the Local Public Improvements.
4.10. In awarding contracts for the purchase of work, labor, services, supplies, equipment,
materials, or any combination of the foregoing, including, but not limited to, public works
contracts awarded under public bidding laws or other contracts in which public bids are
not required by law, Manager agrees to exercise reasonable good faith efforts to obtain
participation by those contractors certified by the State of Indiana as a Minority Business
Enterprise or a Women's Business Enterprise.
ARTICLE V. PAYMENT TO GENERAL CONTRACTORS
5 .1. Redevelopment Commission will provide the Funding Amount in order to timely pay for
the Local Public Improvements.
As City's construction manager, Manager agrees to review invoices presented for payment
by General Contractors. Such invoices shall be made through AIA Application and
Certificate for Payment, where applicable and consistent with industry guidelines.
Manager will forward approved invoices to Board of Works at the following address:
{20150101.DOCX}
4
South Bend Board of Public Works
227 W. Jefferson Boulevard
Suite 1300 N.
South Bend, IN 46601
Attention: Toy Villa
5.2. No payment request or statement made pursuant to this Article shall exceed the estimated
amount in value of the work and services performed by a General Contractor without the
prior approval of both Owner and City (such approvals not to be unreasonably withheld,
conditioned or delayed). Payment requests or statements made pursuant to this Article V
not exceeding the estimated amount in value of the work and services performed by a
General Contractor shall be promptly approved by City after City is able to reasonably
verify that the factual information contained in the request or statement submitted is correct
and that the work or services for which payment is sought has been substantially completed.
City shall make commercially-reasonable efforts to verify the same within 15 days after
such payment request or statement is delivered by Funding.
5 .3. Payment instructions made by Funding on behalf of General Contractors shall be made on
an as-needed or as-billed basis. A written payment instruction shall be accompanied by a
signed letter of transmittal from Funding and include all customary lien waivers, which
includes but is not limited to lien waivers from the General Contractors, and other
customary documentation. Such payments will be made directly from Redevelopment
Commission to the General Contractor within 3 0 days after City approves the same in
accordance with Section 5.2 above (and no such payment shall be made without Funding's
written instruction).
5.4.
If Owner or Funding has paid any General Contractor for work and services performed by
such General Contractor prior to Funding submitting a payment request to City for approval
pursuant to Section 5 .2 above, Funding shall be entitled to submit a payment request for
such work or services and require that, upon such payment request being approved in
accordance with this Article V, such payment be made by Redevelopment Commission
directly to and in the name of Funding rather than to such General Contractor. The sum of
all payments by Redevelopment Commission to either a General Contractor or,
alternatively, directly to Funding are subject to, and may not exceed, the Funding Amount
(as defined in the Development Agreement).
5.5. Notwithstanding anything to the contrary in this Agreement, payments of the Funding
Amount to be made by Redevelopment Commission to Funding to fund the construction
and/or completion of the Local Public Improvements pursuant to the terms of this
Agreement shall be deemed to have been made to Funding for the sole purpose of providing
such payments to Owner.
ARTICLE VI. SUCCESSORS AND ASSIGNS
6.1. City, Developer, Manager, Funding and Owner each binds itself and its successors and
assigns to the other parties of this Agreement and to the successors and assigns of such
{20150101.DOCX}
5
other parties, in respect to the promises, representations, acknowledgements, covenants,
and responsibilities contained in this Agreement.
6.2. Except as otherwise provided herein or in connection with a permitted assignment of the
Development Agreement, none of Developer, Manager, Funding or Owner may assign,
sublet or transfer its interest in this Agreement without the written consent of City.
6.3. Nothing herein shall be construed as creating any personal liability on the part of any
officer or agent of Redevelopment Commission, Board of Works, Developer, Manager,
Funding or Owner.
ARTICLE VII. NOTICES
7 .1. When written notice is required by this Agreement, it shall be sufficiently given, in the
absence of a specific provision to the contrary, if sent by overnight delivery, United States
first-class mail, or hand delivery, in each case to the party to be in receipt thereof, at the
addresses below and shall be deemed delivered (i) upon deposit with an overnight courier,
(ii) upon deposit with the United States Post Office, or (iii) upon hand delivery, as
applicable:
City:
with a copy to:
Developer, Manager, Funding or
Owner:
with a copy to:
South Bend Redevelopment Commission
227 W. Jefferson Boulevard, Suite 1400 S.
South Bend, IN 46601
Attention: David Relos, Director
South Bend Legal Department
227 W. Jefferson Boulevard, Suite 1200 S.
South Bend, IN 46601
Attention: Cristal Brisco, Corporation Counsel
c/o RealAmerica Development, LLC
10711 America Way, Suite 200
Fishers, IN 4603 8
Attn: Jeff Ryan
Kuhl & Grant LLP
707 E. North Street, Suite 800
Indianapolis, IN 46202
Attention: Gareth W. Kuhl
ARTICLE VIII. CHOICE OF FORUM
8.1. The parties agree that any litigation associated with or arising from this Agreement shall
be commenced in a court of competent jurisdiction in St. Joseph County, Indiana ("St.
Joseph County").
{20150101.DOCX}
6
ARTICLE IX. APPLICABLE LAWS
9 .1. Each party agrees to comply with all federal, state, and local laws, rules and regulations as
are in effect from time to time and applicable to that party in performing work pursuant to
this Agreement. This Agreement shall be governed by the laws of the State of Indiana.
ARTICLE X. AMENDMENTS
10.1. This Agreement may be amended only by written instrument and signed by Redevelopment
Commission, Board of Works, Developer, Manager, Funding and Owner.
ARTICLE XI. SEVERABILITY
11.1. In the event any provision of this Agreement is determined by a court of competent
jurisdiction or by the laws of the State of Indiana to be null and void, such provision shall
be stricken and all other provisions which can be given effect independently of the stricken
provision shall remain in full force and effect.
ARTICLE XII. INDEPENDENT CONTRACTOR STATUS
12.1. Each of Developer, Manager, Funding, and Owner expressly understands and agrees that
it is an independent contractor and that it is not an employee of City, and City is not to
provide worker's compensation, health, or accident insurance coverage or indemnification
agreement of any kind which would cover Manager or its employees, if any, in and under
the terms of this Agreement.
ARTICLE XIII. WAIVER
13 .1. City's delay or inaction in pursuing its remedies set forth in this Agreement, or available
by law, shall not operate as a waiver of any of City's rights or remedies. Manager's delay
or inaction in pursuing its remedies set forth in this Agreement, or available by law, shall
not operate as a waiver of any of Manager's rights or remedies.
ARTICLE XIV. TERM OF AGREEMENT
14.1. This Agreement shall become effective upon execution hereof and shall expire on the date
on which Board of Works certifies the Local Public Improvements have been substantially
completed and all General Contractors have been paid by Redevelopment Commission.
ARTICLE XV. DEFAULT
15.1. Developer, Manager, Funding or Owner, as applicable, shall have committed an Event of
Default if it fails to perform any material term, covenant, condition, or agreement contained
in this Agreement for more than 30 days after written notice thereof from City, or within
such other period of time as is reasonably necessary to cure such failure, but only if such
applicable party has, within said 3 0 day period, provided City with assurances that it will
cure the failure as soon as is reasonably possible and it so commences and completes such
cure.
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7
15 .2. City has committed an Event of Default if City fails to perform any material term, covenant,
condition or agreement contained in this Agreement for more than 30 days after written
notice thereof from Developer, Manager, Funding or Owner, or within such other period
of time as is reasonably necessary to cure such failure, but only if City has, within said 30
day period, provided the notifying party with assurances that City will cure the failure as
soon as is reasonably possible and City so commences and completes such cure.
15 .3. Upon the happening of an Event of Default, the non-defaulting party may, at its option and
with prior notice, institute any action, suit or other proceeding at law, in equity (including
any action to compel specific performance) or otherwise which it shall deem necessary or
proper for the protection of its interests under this Agreement.
ARTICLE XVI. MISCELLANEOUS
16 .1. This Agreement may be executed in multiple counterparts, each of which shall be deemed
an original, but all of which together shall constitute one and the same Agreement. In
addition, executed counterparts of this Agreement transmitted via facsimile transmission
or electronic mail shall be deemed effective as an original signature.
16.2. The recitals set forth above, including each and every statement contained therein, is
incorporated herein and made a part of this Agreement as though fully set forth herein.
[Signature Pages Follow.]
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8
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as follows:
REALAMERICA DEVELOPMENT, LLC
By: ~~~~~~~~~~~
Ronda Shrewsbury Weybright, President
THE LASALLE APARTMENTS, LLC
By: Executive Investments, LLC, Member
By: ~~~~~~~~~~~
Ronda Shrewsbury Weybright, President
Dme: ~~~~~~~-~----
REALAMERICA FUNDING CORPORATION
By: ~~~~~~~~~~~
Ronda Shrewsbury Weybright, President
Dme: ~-------~----
{20150101.DOCX}
REALAMERICA CONSTRUCTION, LLC
By: RealAmerica Development, LLC,
Member
By:
~~~~~~~~~~~
Ronda Shrewsbury Weybright, President
SOUTH BEND REDEVELOPMENT
COMMISSION
Printed: ___________ _
Title:
Dme:~-----~---~~~
ATTEST:
Printed: ___________ _
Title:
~------~-----
Dme: ~-~----~---~-
ATTEST:
Linda Martin, Clerk
{20150101.DOCX}
SOUTH BEND BOARD OF
PUBLIC WORKS
Gary Gilot, President
Kathryn Roos, Member
David Relos, Member
Patrick Henthorn, Member
Brian Pawlowski, Member
EXHIBITE
Option And Right Of First Refusal Agreement
OPTION AND RIGHT OF FIRST REFUSAL AGREEMENT
THIS OPTION AND RIGHT OF FIRST REFUSAL AGREEMENT (this "Agreement")
is made and entered into as of the_ day of , 2015 (the "Effective Date"), by and
between South Bend Redevelopment Commission, governing body of the Department of
Redevelopment of the City of South Bend, Indiana ("Commission"), and The LaSalle Apartments,
LLC, an Indiana limited liability company ("Developer").
RECITALS
WHEREAS, Commission is the owner of that certain real estate situated in South Bend,
Indiana and described on Exhibit A attached hereto and made a part hereof (the "Option Parcel");
WHEREAS, Commission is also the owner of that certain real estate situated in South
Bend, Indiana and described on Exhibit B attached hereto and made a part hereof (the "Parking
Parcel" and together with the Option Parcel, the "Premises");
WHEREAS, Developer has acquired from Commission that certain real estate situated in
South Bend, Indiana, described on Exhibit C attached hereto and made a part hereof (the "Project
Property"), upon which Developer intends to develop a mixed-use apartment project with retail or
other commercial use on the ground floor to be known as "The LaSalle Apartments," or the
"Project" under the Development Agreement between Lessor and RealAmerica Development
LLC, an affiliate of Developer, dated November 24, 2014 (the "2014 Development Agreement");
WHEREAS, in order to generate tax increment finance revenues ("TIP Revenues"),
Commission desires to convey the Option Parcel to Developer or a third-party willing to construct
a new building (the "New Building") thereon;
WHEREAS, subject to Commission's determination thatthe TIP Revenues to be generated
from the Project Property and the Option Parcel will be sufficient to finance the cost of
construction, Commission intends to construct a four ( 4) deck parking structure on a portion of the
Premises (the "Parking Garage") to support parking for multiple uses including, without limitation,
by users of The LaSalle Apartments and by users of the New Building; and
WHEREAS, Developer desires to obtain from Commission and Commission desires to
grant to Developer an option to purchase the 0ption Parcel and a right of first refusal to construct
the New Building thereon in accordance with the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the payment of One Dollar ($1.00), and of the
mutual covenants and promises contained in this Agreement and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
1. Option to Purchase. Subject to the limitations contained in this Agreement,
Commission hereby grants to Developer a one-time right and option to purchase any portion of
the Option Parcel situated east of the Parking Garage as approximately depicted in Exhibit B to
the 2014 Development Agreement and identified therein as the "Public Plaza" (the "Optioned
{20150213.DOCX}
Portion"), provided that Developer will use such land for construction of the New Building (the
"Option").
2. Option Term. Developer's right to exercise the Option shall commence on the
Effective Date and shall continue until 11 :59 p.m. on the tenth (10th) anniversary thereof, unless
earlier terminated pursuant to terms set forth in this Agreement (the "Option Term"). If Developer
does not exercise the Option prior to the expiration of the Option Term, this Agreement shall
terminate and neither party shall thereafter have further liability to the other arising out of this
Agreement except for those provisions of this Agreement which expressly survive termination.
3. Exercise of Option. The Option shall be exercised if and when Developer provides
Commission with written notice, given in accordance with Paragraph 8 of this Agreement, of
Developer's intent to construct the New Building on the Optioned Portion (the "Option Notice").
Notwithstanding Developer's exercise of the Option, Commission's obligation to sell the Optioned
Portion to Developer is conditioned upon Commission determining, in its sole but reasonable
discretion, that the TIF Revenues being received or expected to be generated by development upon
the Project Property and the Option Parcel are sufficient to support the financing and construction
of the Parking Garage over a reasonable period of time. After receiving Developer's Option
Notice, Commission will deliver to Developer its determination of the sufficiency ofTIF Revenues
(the date of which delivery is referred to as the "Determination Date"). After the Determination
Date, if the Commission's determination is favorable, Commission and Developer shall negotiate
in good faith to enter into a development agreement providing for the sale of the Optioned Portion
to Developer and the construction of the Parking Garage by Commission (the "Option
Development Agreement"). The closing of the Option (the "Closing") shall occur within ninety
(90) days after the Determination Date, or such longer period as may be mutually agreed to
between the parties. Developer shall be responsible for paying its own costs and expenses related
to the Option Parcel and the Closing including, without limitation, (i) closing costs, and (ii) costs
of obtaining title insurance, a survey or any other reports, studies or investigations.
4. Option Purchase Price and Payment. If Developer exercises the Option to purchase
the Optioned Portion, the purchase price for such purchase shall be One and 00/100 Dollars ($1.00)
(the "Purchase Price"). Developer shall pay to Commission at Closing the Purchase Price by wire
transfer to an account of Commission designated at least three (3) business days prior to Closing,
or otherwise by immediately available funds.
5. Right of First Refusal. If, during the Option Period and prior to Developer's ·
exercise of the Option, Commission receives a bona-fide third-party's proposal to construct the
New Building, as determined in the Commission's sole but reasonable discretion and set forth in
a written resolution of the Commission (a "Third-Party Proposal") that the Commission determines
will generate TIF Revenues that are, when coupled with any new TIF Revenues from the Project
Property, sufficient to support the financing and construction of the Parking Garage, Commission
shall provide written notice of such Third-Party Proposal (the "ROFR Notice") to Developer, given
in accordance with Paragraph 8 of this Agreement. Developer shall have a period of forty-five
(45) days from the date the ROFR Notice is deemed to be given under Paragraph 8 of this
Agreement in which to make an alternative proposal for construction of the New Building (the
"Alternate Proposal"). If Developer fails to submit the Alternate Proposal within the time allowed,
the Option Period shall terminate and Commission may proceed to otherwise provide for the
{20150213.DOCX}
2
development of the Option Parcel, so long as any such development includes construction of the
Parking Garage on the Option Parcel, subject to the parking rights of Developer stated in Section.
6.4 of the 2014 Development Agreement. In the event Developer submits the Alternative Proposal
within the time allowed, Commission will review the Alternate Proposal in its regular course of
business. If after review of the Alternate Proposal, Commission determines, in its sole but
reasonable discretion, that the TIF Revenues being received or expected to be generated by
development on the Project Property and the Option Parcel are sufficient to support the financing
and construction of the Parking Garage over a reasonable period of time, Commission shall reject
the Third-Party Proposal. Thereafter, Commission and Developer shall negotiate in good faith an
Option Development Agreement. In the event Developer and Commission do not enter into an
Option Development Agreement within ninety (90) days after the Determination Date, the Option
Period shall terminate and Commission may proceed to otherwise provide for the development of
the Option Parcel, provided such development includes construction of the Parking Garage on the
Option Parcel, subject to the parking rights of Developer stated in Section 6.4 of the 2014
Development Agreement.
6. Representations and Warranties. As a material inducement to Developer for
entering into this Agreement, Commission represents and warrants to Developer as follows, which
representations and warranties shall be true and correct as of the Effective Date and, if Developer
elects to exercise the Option, as of the date of the Closing:
(a) Commission owns good, marketable and indefeasible fee simple title to the Option
Parcel, subject only to the lien of current, non-delinquent real estate taxes and
easements and other encumbrances of record.
(b) Commission has full right, power and authority to grant the Option and other rights
to Developer set forth herein and, if Developer elects to exercise the Option and to
consummate the Closing, to sell, transfer, convey and assign the Optioned Portion
to Developer for construction of the New Building.
7. Brokers. Commission and Developer represent and warrant to each other that they
have dealt with no broker, finder or other person with respect to this Agreement or the transactions
contemplated hereby and, insofar as they know, no broker, finder or other person is entitled to any
commission or finder's fee in connection herewith. Commission and Developer each agree to
indemnify and hold harmless one another from and against any loss, liability, damage or claim
incurred by reason of any brokerage commission or finder's fee alleged to be payable to anyone
because of any act, omission or statement of the indemnifying party. Such indemnity obligations
shall be deemed to include, without limitation, the payment of reasonable attorneys' fees and court
costs incurred in defending any such claim, and shall survive the Closing under this Agreement or
the termination of this Agreement.
8. Notices. All notices, requests, demands, consents and other communications
required or permitted under this Agreement shall be in writing and shall be deemed to have been
duly and properly given on the date of service if delivered personally, or, if mailed, on the second
business day after such notice is deposited in a receptacle of the United States Postal Service,
registered or certified mail, first class postage prepaid, return receipt requested, or on the first
{20150213.DOCX}
3
business day following deposit with a nationally recognized overnight courier service (~,
FedEx), postage prepaid, in any event addressed appropriately as follows:
Commission:
with a copy to:
Developer:
with a copy to:
South Bend Redevelopment Commission
227 W. Jefferson Boulevard, Suite 1400 S.
South Bend, IN 46601
Attn: Chris Fielding
South Bend Department of Law
227 W. Jefferson Boulevard, Suite 1200 S.
South Bend, IN 46601
Attn: Corporation Counsel
The LaSalle Apartments, LLC
10711 America Way, Suite 200
Fishers, IN 4603 8
Attn: Ronda Shrewsbury Weybright, President
Kuhl & Grant LLP
707 E. North Street, Suite 800
Indianapolis, IN 46202
Attn: Gareth W. Kuhl
Either party may change its address for purposes of this Paragraph by giving the other party
written notice of the new address in the manner set forth above.
9. Assignment; Entirety of Agreement. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and assigns. This writing
embodies the entire agreement between the parties hereto with respect to the subject matter hereof
and there are no representations, promises, understandings or agreements, oral or written, between
the parties which are not set forth herein. Developer may assign all or any of its rights under this
Agreement upon written notice to Commission, which will contain Developer's certification that
the assignee is an affiliate of Developer sharing common ownership with Developer.
10. Counterparts. This Agreement may be executed by the parties to this Agreement
in separate and/or multiple counterparts, each of which when so executed shall be deemed to be
an original and all of which taken together shall constitute one and the same document.
11. Governing Law. This Agreement shall be construed and enforced in accordance
with the laws of the State of Indiana.
12. Attorneys' Fees. In the event of any controversy, claim, or dispute between
Developer and Commission arising out of or related to this Agreement or the breach thereof, each
party shall bear its own costs and expenses in connection with such controversy, claim, or dispute,
including all attorneys' fees.
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4
13. Time is of the Essence. Time is expressly declared to be of the essence for this
Agreement.
14. Interpretation. The terms· and conditions of this Agreement represent the results of
bargaining and negotiations among the parties, each of which has been represented by counsel of
its own selection, and neither of which has acted under duress or compulsion, whether legal,
economic, or otherwise, and represent the results of a combined draftsmanship effort. The terms
and conditions hereof shall be interpreted and construed in accordance with their usual and
customary meanings, unless a specific definition has been given, and the parties hereby expressly
waive and disclaim any rule of law or procedure requiring otherwise, specifically including but
not limited to any rule of law to the effect that ambiguous or conflicting terms or conditions shall
be interpreted or construed against the party whose counsel prepared this Agreement or. any earlier
draft hereof. Paragraph headings are for convenience only and shall not affect the interpretation
of this Agreement. Except as otherwise expressly provided in this Agreement, any reference to
"days" shall mean calendar days.
15. No Agency: Nothing in this Agreement will be deemed or construed by either party
or by any third person to create the relationship of principal and agent or of limited or general
partners or of joint ventures or of any other association between the parties. ·
16. Modifications. Any modification of this Agreement or additional obligation
assumed by either party hereto in connection with this Agreement shall be binding only if
evidenced in a writing signed by each party or their authorized representative(s).
1 7. Authority to Execute. Each person executing this Agreement on behalf of
Commission or Developer represents and warrants that:
(a) he or she has been authorized to execute and deliver this Agreement by the entity
for which he or she is signing; and
(b) this Agreement is valid and binding upon such entity, enforceable in accordance
with its terms.
18. Merger. All prior representations, undertakings, and/or agreements by or between
Commission and Developer with respect to the subject matter of this Agreement have been merged
into and expressed in this Agreement. To the extent such prior representations, undertakings
and/or agreements by and between Commission and Developer with respect to the same have not
been merged into or expressed in this Agreement, they are hereby cancelled.
19. Partial Invalidity of Agreement. The invalidity or unenforceability of any particular
term or condition of this Agreement shall have no effect upon any other term or condition and this
Agreement shall be construed in all respects as if such invalid or unenforceable term or condition
had not been contained herein.
20. Memorandum of Agreement. Upon Developer's request, Commission and
Developer shall execute and record a memorandum of this Agreement in the Office of the Recorder
of St. Joseph County, Indiana, in form and substance reasonably acceptable to Commission and
{20150213.DOCX}
5
Developer (the "Memorandum"). Developer shall bear the cost and expense of recording the
Memorandum.
[Signature Page Follows.]
{20150213.DOCX}
6
IN WITNESS WHEREOF, the undersigned have executed this Agreement to·be effective
as of the Effective Date.
{20150213.DOCX}
"COMMISSION":
SOUTH BEND REDEVELOPMENT
COMMISSION, governing body of the Department
of Redevelopment of the City of South Bend, Indiana
Title: _______________ _
ATTEST:
Title: ----------------
"DEVELOPER":
THE LASALLE APARTMENTS, LLC, an Indiana
limited liability company
By: Executive Investments, LLC, its Member
Ronda Shrewsbury Weybright, President
EXHIBIT A
OPTION PARCEL
A part of the West half of the Northwest Quarter of Section 12, Township 3 7 North, Range 2 East,
also known as Lots #2 and #3 in the recorded plan of the Original Plat of the Town (now City) of
South Bend Portage Township, City of South Bend, St. Joseph County, Indiana. [Parcel Key Nos.
018-1002-004_1 and 018-1002-0042]
{20150213.DOCX}
EXHIBITB
PARKING PARCEL
A part of the West half of the Northwest Quarter of Section 12, Township 37 North, Range 2 East,
also known as Lot #10 in the recorded plan of the Original Plat of the Town (now City) of South
Bend Portage Township, City of South Bend, St. Joseph County, Indiana. [Parcel Key No. 018-
1008-0304]
{20150213.DOCX}
EXHIBITC
PROJECT PROPERTY
A part of the West half of the Northwest Quarter of Section 12, Township 3 7 North, Range 2 East,
also known as Lot #1 in the recorded plan of the Original Plat of the Town (now City) of South
Bend Portage Township, City of South Bend, St. Joseph County, Indiana. [Parcel Key No. 018-
1002-0040]
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EXHIBITF
Form of Parking Lease
PARKING LEASE
THIS PARKING LEASE (this "Lease") is made this _ day of ______ _
201_ (the "Commencement Date"), by and between the South Bend Redevelopment
Commission, governing body of the Department of Redevelopment of the City of South Bend,
Indiana ("Lessor"), and The LaSalle Apartments, LLC, an Indiana limited liability company
("Lessee" collectively with Lessor may be referred to as the "Parties," each being a "Party").
RECITALS
WHEREAS, Lessor is the owner of that certain real estate situated in South Bend, Indiana
and described on Exhibit A attached hereto and made a part hereof (the "Support Parcel");
WHEREAS, Lessor is also the owner of that certain real estate situated in South Bend,
Indiana and described on Exhibit B attached hereto and made a part hereof (the "Parking Parcel"
and together with the Support Parcel, the "Premises");
WHEREAS, Lessee has previously acquired from Lessor that certain real estate situated in
South Bend, Indiana, described on Exhibit C attached hereto and made a part hereof (the "Project
Property"), upon which Lessee has developed a mixed-use apartment project with retail or other
commercial use on the ground floor known as "The LaSalle Apartments," or the "Project" under
the Development Agreement between Lessor and RealAmerica Development LLC, an affiliate of
Lessee, dated November 24, 2014 (the "Development Agreement");
WHEREAS, the Project has reached Substantial Completion in accordance with the terms
and conditions of the Development Agreement;
WHEREAS, in connection with Lessee's acquisition of the Project Property from Lessor,
Lessor granted a certain option, right of first refusal and other rights to Lessee with respect to the
Premises as set forth in that certain Option and Right of First Refusal Agreement executed by and
between Lessor and Lessee, dated as of , 2015 (the "Option Agreement"), which
Option Agreement is evidenced by that certain Memorandum of Option and Right of First Refusal
Agreement dated as of , 2015, and recorded , 2015, as Instrument No.
______ ,in the Office of the Recorder of St. Joseph County, Indiana; and
WHEREAS, Lessee requires parking for the residents of the Project Property and access
to certain rights-of-way adjacent to the Premises and Lessor desires to lease the Premises to Lessee
for the purpose of providing such parking, access and other uses in accordance with the terms and
conditions set forth in this Lease.
NOW, THEREFORE, in consideration of the foregoing Recitals, the mutual agreements
contained herein, One Dollar ($1.00) and other good and valuable consideration, the receipt and
legal sufficiency of which are hereby acknowledged, Lessor and Lessee agree as follows:
AGREEMENT
Section 1. Lease and Use.
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Section 1.1 Lessor hereby leases to Lessee, Lessee's successors, assigns,
licensees and invitees, or any of the agents or representatives of Lessee, the Premises.
Lessee shall only use the Premises for purposes of parking properly licensed passenger
motor vehicles, including motorcycles, parking of bicycles, the placement of one or more
trash dumpsters and/or utility service boxes or other utility equipment (including, without
limitation, an electrical transformer) to serve the Project Property, and the common passage
of persons and vehicles across said Premises in order to provide access between the Project
Property and the rights-of-way commonly known as Main Street and Michigan Street in
South Bend, Indiana.
Section 1.2 All of Lessee's, or any Leasehold Mortgagee's, rights under this
Lease, including its rights to use and possess the Premises, are conditioned on the use of
the Project Property (excluding the square footage of the ground floor of the multi-story
building on the Project Property) primarily for residential purposes.
Section 1.3 Notwithstanding anything to the contrary in this Lease, in the event
that the rentable square footage of the multi-story building on the Project Property
(exclusive of the square footage of the ground floor of said multi-story building) is less
than fifty percent (50%) resident-occupied for any consecutive period of two (2) years or
more, except to the extent due to casualties or non-discretionary repairs to the building that
prohibit such occupancy, Lessee hereby agrees that, upon request of Lessor, Lessee shall
sublease back to Lessor a number of parking spaces on the Premises corresponding to the
percentage of the rentable square footage of the building that is unoccupied until such time
that Lessee delivers reasonable evidence to Lessor that the rentable square footage within
the residential portion of the multi-story building is no longer less than fifty percent (50%)
resident-occupied. Upon such sublease, Lessor shall be obligated to reimburse Lessee for
a pro-rata share of any maintenance and repair costs and/or expenses incurred by L.essee
with respect to the parking areas and parking-related facilities upon the Premises promptly
after Lessee delivers to Lessor an invoice and reasonable supporting evidence of the same.
Lessor's reimbursement obligation will be strictly limited to expenses of regular
maintenance and repairs that are incurred by Lessee during the term of the sublease by
Lessee to Lessor. Lessor's reimbursement obligation extends only to maintenance and
repairs of parking areas and parking-related facilities existing as of the commencement of
the sublease by Lessee to Lessor, and Lessor will not be required to reimburse Lessee for
maintenance or repairs of structures or facilities built upon the Premises during the term of
the sublease by Lessee to Lessor. Lessor's pro-rata share of such maintenance and repair
costs and/or expenses will be calculated by multiplying the total amount of such costs
and/or expenses by a fraction having a numerator equal to the number of parking spaces
subleased to Lessor and a denominator equal to the total number of parking spaces upon
the Premises. Lessor will have no obligation to pay any taxes levied upon the Premises
with respect to the term of the sublease by Lessee to Lessor or any other time.
Section 2. Term. The initial term of this Lease will commence on the date of this Lease
and will terminate twenty (20) years from the date hereof and shall thereafter automatically renew
for seven (7) successive periods of ten (10) year each, subject to any rights of termination herein
(the initial term and any renewal terms being referred to hereinafter as the "Term").
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Section 3. Rent. During the Term of this Lease, Lessee will pay to Lessor One Dollar
($1.00) per year as rent for the Premises. Such annual rent shall be due on the Commencement
Date and on or before each anniversary thereof during the Term. Lessee may pre-pay the rent for
the entire Term at any time.
Section 4. Maintenance, Repairs, Improvements. Lessee shall, at Lessee's cost and
expense, keep the Premises and any improvements thereon in a clean, neat and safe condition and,
pursuant to such requirement, shall have the right to replace, repair, add security fencing and/or
lighting, sealcoat and stripe the Premises and to add covered parking improvements on the Support
Parcel (e.g. garages or carports) as determined necessary or appropriate by t;essee and subject to
Lessor's written approval (which approval shall not be unreasonably withheld, conditioned or
delayed). To the extent any permits, variances or rezonings are necessary to allow Lessee to
accomplish any of the work described in the foregoing sentence, Lessor shall cooperate with
Lessee in all such applications and/or proceedings to secure the same including, without limitation,
filing any applications or instituting proceedings therefor or joining with Lessee therein. Upon
expiration or termination of this Lease, Lessee will restore the Premises to the condition that
existed on the Commencement Date, including, if Lessor so instructs, the removal of any
structures, fixtures or improvements from the Premises provided, however, Lessee shall have no
obligation to remove any structures, fixtures or improvements approved by Lessor in accordance
with this Section 4 unless Lessor conditions such approval upon Lessee agreeing to such removal
upon expiration or earlier termination of this Lease.
Section 5. Eminent Domain
Section 5.1. Termination of Lease. Lessor and Lessee agree that, in the event of
a Taking (as defined below) such that Lessee reasonably determines that the Premises
cannot continue to be operated, at reasonable cost, for its then-current use, then this Lease
shall, at Lessee's sole option, terminate as of the Taking Date (as defined below). "Taking"
as defined herein, means a taking during the Term hereof of all or any part of the Premises,
or any interest therein or right accruing thereto, as a result of the exercise by any
governmental unit of the government of the United States of America or of the State of
Indiana (but excluding Lessor and the City of South Bend, Indiana) of the right of
condemnation or eminent domain affecting the Premises or any part thereof. A conveyance
to a governmental authority or unit in lieu or in anticipation of any such right of
condemnation or eminent domain shall also be considered a Taking hereunder. Any
Taking shall be deemed to have occurred upon the date (the "Taking Date") that is the
earlier to occur of (a) the date on which the property, right or interest so taken must be
surrendered to the condemning authority, or (b) the date title vested in a condemning
authority or other party pursuant to any Taking.
Section 5 .2. Continuation of Lease and Presumption of Restoration. Lessor and
Lessee agree that, in the event of a Taking that does not result in the termination of this
Lease pursuant to Section 5 .1 above, this Lease shall continue in effect as to the remainder
of the Premises, and the Net Condemnation Award (as defined below) will be disbursed in
accordance with applicable laws and regulations and, to the extent permitted by the
foregoing, in accordance with Sections 5.3 and 5.5 below, as applicable. The Net
Condemnation Award shall be used so as to make the Premises as nearly as reasonably
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possible to the condition existing prior to the Taking, to the reasonable satisfaction of the
Lessee, subject to applicable requirements of any Leasehold Mortgages (as defined below).
During the Term a decision as to whether or not to restore or rebuild shall be made in the
sole judgment of Lessee, subject to any applicable requirements of any Leasehold
Mortgages. "Net Condemnation Award" as defined herein, means the net amounts owed
or paid to the Parties or to which either of the Parties may be or become entitled by reason
of any Taking or pursuant to any agreement with any condemning authority which has been
made in settlement of any proceeding relating to a Taking, less any reasonable costs and
expenses incurred by the Parties in collecting such award or payment. ''Leasehold
Mortgage" as defined herein, means any mortgage, security agreement or collateral
assignment encumbering Lessee's interest created hereunder. "Leasehold Mortgagee" as
defined herein, means the holder, mortgagee, grantee or secured party under any Leasehold
Mortgage.
Section 5.3. Temporary Taking. If there shall be a temporary Taking with respect
to all or any part of the Premises or of Lessee's interest in this Lease, then the Term shall
not be reduced and Lessee shall continue to pay in full all rents and other charges required
herein, without reduction or abatement thereof at the times herein specified; provided,
however, that Lessee shall not be required to perform such obligations that Lessee is
prevented from performing by reason of such temporary Taking and that the portion of the
Net Condemnation Award based upon the value of lost parking spaces upon the Premises
as a result of from such temporary Taking shall be assigned to Lessee.
Section 5.4. Joinder. If a Leasehold Mortgage or Leasehold Mortgages exist, the
Leasehold Mortgagees, to the extent permitted by law, shall be made a party to any Taking
proceeding.
Section 5.5 Right to Net Condemnation Award. Notwithstanding anything to
the contrary hereunder, if, prior to any Taking, Lessee has duly notified Lessor of Lessee's
intent to exercise its rights to acquire the Premises or any portion thereof pursuant to the
Option Agreement, then a proportionate share of the Net Condemnation Award resulting
from such Taking, computed as a function of Lessee's proportional ownership of the
Premises that will result from Lessee's acquisition under the Option Agreement (by square
footage or other equitable measure taking into account any improvements, structure or
fixtures installed by Lessee thereon, if any), shall belong to Lessee unless Lessee ultimately
elects not to acquire. the Premises, in which case, such Net Condemnation Award shall be
allocated pursuant to Section 5 .2 or Section 5 .3 above.
Section 6. Nature and Assignment of this Lease. If Lessor shall sell or assign its entire
interest or estate in the Premises, it shall have no further liability for the performance thereafter of
the obligations of Lessor hereunder other than those that accrued while it owned the Premises,
provided, however, this Lease shall remain in full force and effect and binding upon the new owner
of the Premises.
Section 7. Indemnification. Lessee agrees to indemnify, defend, and hold Lessor
harmless from and against any and all liability, loss, claims, damages, penalties, fines, costs and
expenses, including, without limitation, reasonable attorneys' fees, and for any and all injury to
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persons or damage to property, that arise from or out of a breach of its covenants and obligations
hereunder and/or its negligence or willful acts or omissions, except to the extent caused by the
negligent or willful acts or omissions of Lessor or its licensees, suppliers, agents, customers or
invitees. Lessor agrees to indemnify, defend, and hold Lessee harmless from and against any and
all liability, loss, claims, damages, penalties, fines, costs and expenses, including, without
limitation, reasonable attorneys' fees, and for any and all injury to persons or damage to property,
that arise from or out of the presence of any hazardous material present on the Premises, unless
introduced or released by Lessee or its agents, tenants or invitees, and that arise from or out of a
breach of its covenants and obligations hereunder and/or its negligence or willful acts or omissions.
Section 8. Use by Lessor. Lessor shall not construct or place or permit to be
constructed or placed, any structure or obstruction on the Premises that will damage or disturb the
improvements or unreasonably prevent or interfere with Lessee's use of the Premises for the
purposes permitted herein, provided, however that Lessor may undertake any and all development
activities contemplated in the Option Agreement.
Section 9. Insurance. Lessee agrees to maintain insurance of the kinds and amounts
set forth in Exhibit E to the Development Agreement, insuring against any and all claims for bodily
injury, death or property damage occurring on, in or about the Premises as a result of the activities
contemplated by this Lease and will name Lessor as an additional insured under all such insurance
policies.
Section 10. Real Estate Taxes. Lessee shall be responsible for the payment of all real
property taxes and assessments, of any nature whatsoever (the "Taxes"), which are levied against
the Premises for all periods during the Term of this Lease.
Section 11. Default. If Lessor defaults in or otherwise fails to perform any of its
obligations set forth in this Lease, and fails to cure any such default or failure within thirty (30)
business days after receipt of written notice from Lessee (except in the case of an emergency which
shall be cured as soon as reasonably practicable), then Lessee, as its sole remedies, may, at its
option, cure such default at its expense and collect from Lessor the reasonable costs incurred in
curing such default including reasonable attorney's fees, terminate the Lease, or pursue any
applicable injunctive or equitable remedies. If Lessee defaults in or otherwise fails to perform any
of its obligations set forth in this Lease, and fails to cure any such default or failure within thirty
(3 0) business days after receipt of written notice from Lessor (except in the case of an emergency
which shall be cured as soon as reasonably practicable), then Lessor, as its sole remedies, may cure
such default at its expense and collect from Lessee the reasonable costs incurred in curing such
default or may pursue any applicable injunctive or equitable remedies. Any reimbursement for
curing a default of the other party shall be due and payable thirty (3 0) days after the written demand
of the curing party, which demand shall include paid invoices or other evidence of payment or
expense. Notwithstanding the foregoing, if the default is of such a nature that it cannot reasonably
be cured within thirty (3 0) days, then, so long as the defaulting party commences the cure within
said thirty (30) day period, and thereafter diligently pursues the cure to completion, the cure period
shall be extended for such periods as may be reasonable under the circumstances, not to exceed
ninety (90) days. No interest will accrue on any such expenses. Any default of Lessee which
Lessee does not cure within the time periods set forth above shall be referred to herein as an "Event
of Default".
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Section 12. Severability. The invalidity or unenforceability of any covenant, condition,
term or provision in this Lease shall not affect the validity and enforceability of any other covenant,
condition, term or provision.
Section 13. Notices. Any notices or other communication given under this Lease shall
be in writing and shall be deemed to have been duly and properly given on the date of service if
delivered via hand delivery, or on the first business day following deposit with a nationally
recognized overnight courier service (e.g., FedEx), postage prepaid, in any event addressed
appropriately as follows:
Lessor:
Lessee:
with copies to:
Leasehold Mortgagee:
Counsel for Leasehold
Mortgagee:
South Bend Redevelopment Commission
227 W. Jefferson Boulevard
South Bend, IN 46601
Attn: _______ ~
The LaSalle Apartments, LLC
10711 America Way, Suite 200
Fishers, IN 4603 8
Attn: Ronda Shrewsbury W eybright, President
Kuhl & Grant LLP
707 E. North Street, Suite 800
Indianapolis, IN 46202
Attn: Gareth W. Kuhl
and
Attn: _____ _
and
Attn:
Any Party or Leasehold Mortgagee may change its address for purposes of this Paragraph
by giving the other parties written notice of the new address in the manner set forth above.
Section 14. Governing Law. The conditions, terms and provisions of this Lease shall
be governed by and construed in accordance with the laws of the State of Indiana.
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Section 15. Construction. The Section headings are included only for convenience, and
shall not be construed to modify or affect the covenants, terms or provisions of any Section. All
negotiations, considerations, representations, and understandings between the Parties are
incorporated herein, and may be modified or altered only by agreement in writing signed by both
Parties.
Section 16. Attorney Fees. In the event that it shall be necessary for either Party to
retain an attorney to enforce the obligations of the other Party hereunder, each Party shall bear its
own costs and expenses incurred in connection therewith, including all attorneys' fees.
Section 17. Assignment or Sublet. Lessee may not assign, transfer, or encumber this
Lease in whole or in part without the prior written consent of the Lessor, provided, however,
Lessee may, without Lessor's consent, assign this Lease to any party that purchases the Project
Property and Lessee may encumber all of its right, title and interest in the Premises subject to the
terms of Section 18 hereof. In the event of any assignment of this Lease by a Lessee to a party
that purchases the Project Property, the assigning Lessee shall have· no further liability for the
performance thereafter of the obligations of Lessee hereunder other than those that accrued while
it leased and occupied the Premises. Notwithstanding the foregoing in this Section 17, Lessee
shall have the right to sublease the Premises or any portion thereof to tenants or occupants of the
Project Property without the consent of Lessor.
Section 18. Permitted Mortgages.
Section 18.1. Right to Encumber. Lessee shall have the right during the Term to
encumber, through a Leasehold Mortgage, all of Lessee's right, title and interest in the
Premises subject to the provisions of this Lease.
Section 18.2. Notice to Leasehold Mortgagee. During any period in which a
Leasehold Mortgage is in place, Lessor shall give any such Leasehold Mortgagee of which
Lessor has received notice from Lessee a duplicate copy of all notices of default and other
notices that Lessor may give to or serve in writing upon Lessee pursuant to the terms of
this Lease. No notice by Lessor to Lessee under this Lease shall be effective unless and
until a copy of such notice has been provided to each Leasehold Mortgagee of which Lessor
has received notice from Lessee. Lessor is deemed to have notice of the Leasehold
Mortgagee set forth in Section 13 above.
Section 18.3. Right of Leasehold Mortgagee to Cure. Any Leasehold Mortgagee,
at its option at any time within thirty (30) days following the later of (i) the expiration of
the right of Lessee to cure any default under this Lease or (ii) such Leasehold Mortgagee's
receipt of notice of such default, ,may pay any amount or do any act or thing required of
Lessee by the terms of this Lease. All payments made and all acts performed by a
Leasehold Mortgagee during such time shall be effective to prevent a termination of the
rights of Lessee hereunder to the same extent as if they had been timely performed by
Lessee. Notwithstanding anything in this Lease to the contrary, in the event of Lessee's
bankruptcy or similar defaults which by their very nature are incapable of cure by any
person other than Lessee, Lessor agrees not to terminate the Lease so long as any Leasehold
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Mortgagee continues to pay all rent and perform all other obligations of Lessee which are
capable of being performed by a Leasehold Mortgagee.
Section 18.4. Right to New Lease. Notwithstanding anything to the contrary
contained herein, no termination of this Lease resulting from an Event of Default shall
become effective until each Leasehold Mortgagee providing notice to Lessor in accordance
with Section 18.2 above (in order of lien priority) shall have had the option, exercisable by
giving Lessor written notice not more than thirty (30) days after Lessor has given such
Leasehold Mortgagee notice that Lessee has failed to cure an Event of Default by Lessee
hereunder within any applicable cure period as provided herein, and Lessor has elected to
terminate this Lease, to elect to receive from Lessor a new lease to such Leasehold
Mortgagee (or its successor in interest) (or to its nominee) covering the Premises for the
then unexpired balance of the Term, and otherwise on the same terms and conditions as set
forth in this Lease. Simultaneously with the termination of this Lease by reason of an
Event of Default as described in this Section 18.4, Lessor agrees to execute such new lease
having an effective date as of the date of the termination of this Lease with such Leasehold
Mortgagee (or its successor in interest or its nominee), if such Leasehold Mortgagee:
(a) shall cure immediately any monetary Event of Default by Lessee hereunder;
(b) shall undertake immediately to remedy any non-monetary Event of Default
·by Lessee hereunder, excluding those which by their very nature are
incapable of cure by any person other than Lessee, and thereafter proceed
with reasonable diligence to cure such Event of Default within a reasonable
period of time; provided, however, that such period shall not extend for more
than one hundred twenty (120) days after the date of such agreement, unless
within said one hundred twenty (120) day period Leasehold Mortgagee
commences to eliminate the cause of such default and proceeds therewith
diligently and with reasonable dispatch; and
( c) shall agree to perform thereafter all covenants and conditions contained in
this Lease to be observed and performed by Lessee.
In the event more than one (1) Leasehold Mortgagee elects in accordance with the terms
hereof to receive from Lessor a new lease covering the Premises, then Lessor agrees that
it will enter into such new lease with the Leasehold Mortgagee which holds the most
senior Leasehold Mortgage having the highest lien priority. The terms of this Section
18.4 shall survive the termination of this Lease.
Section 18.5. Estoppel Certificates. Lessor and Lessee agree that at any time and
from time to time upon not less than fifteen (15) days prior written notice by the other
Party, or upon request from any Leasehold Mortgagee or a permitted assignee or other
interested party, Lessor or Lessee will execute, acknowledge and deliver to the other Party
or to such Leasehold Mortgagee a statement in writing certifying (a) that this Lease is
unmodified and in full force and effect; (b) the date through which the rent has been paid;
and ( c) that, to the knowledge of the certifier (if such be the case), there is no default, set-
off, defense or other claim against Lessor or Lessee, as applicable, other than those, if any,
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so specified under the provisions of this Lease. It is intended that any such statement may
be relied upon by any persons proposing to acquire the interest of Lessor, Lessee or any
Leasehold Mortgagee, as the case may be, in this Lease or by any prospective Leasehold
Mortgagee or assignee of any Leasehold Mortgage.
Section 18.6. Mortgage of Lessor's Estate. Lessor agrees not to encumber or
convey any interest in Lessor's Estate (as defined below) with any deed to secure debt,
mortgage, or other instrument in the nature thereof as security for any debt which is not
expressly subordinate to Lessee's Estate under this Lease and to any Leasehold Mortgage,
without the written consent of Lessee and all Leasehold Mortgagees providing notice to
Lessor in accordance with Section 18 .2 above. Lessor agrees not to permit any liens arising
from work contracted for by Lessor to be filed against the Premises without causing the
same to be removed or bonded over within five (5) days of such filing. Lessor agrees not
to encumber Lessor's Estate with any covenant, easement or restrictions except as may be
required by applicable laws or in accordance with the development( s) contemplated in the
Option Agreement; provided, however, (i) the Lessor shall provide the holder of the
Leasehold Mortgages with thirty (30) days prior written notice of any such covenant,
easement or restriction, and (ii) the holder of the Leasehold Mortgages shall have provided
written consent to any such covenant, easement or restriction that materially or adversely
affects the interest in the Lessee's Estate of the holder of any Leasehold Mortgage.
"Lessor's Estate" for purposes hereof shall mean Lessor's estate in the Premises.
Section 18.7. RESERVED.
Section 18.8. Transfer by Leasehold Mortgagee. For purposes of this Lease, the
making of a leasehold mortgage to a Leasehold Mortgagee shall not be deemed to
constitute a Transfer (as herein after defined) of this Lease or Lessee's interest created
hereby, nor shall any Leasehold Mortgagee, as such, be deemed to be an assignee or
transferee of this Lease or of Lessee's interests under this Lease so as to require such
Leasehold Mortgagee, as such, to assume the performance of any of the terms, covenants
or conditions on the part of Lessee to be performed hereunder, but a Leasehold Mortgagee
may become the holder of Lessee's leasehold estate and succeed to Lessee's interest in this
Lease by foreclosure of its Leasehold Mortgage or as a result of the assignment of this
Lease in lieu of foreclosure, and any purchaser at any sale of Lessee's interest under this
Lease in any proceeding for the foreclosure of any mortgage or the assignee or transferee
of Lessee's interest in this Lease under any instrument of assignment or transfer in lieu of
the foreclosure of any mortgage shall be deemed to be an assignee or transferee approved
by Lessor and shall be deemed to have agreed to perform all of the terms, covenants and
-conditions on the part of Lessee to be performed hereunder, but only for so long as such
purchaser or assignee is the owner of Lessee's interest in this Lease.
Section 18.9. Sale of Premises. In the event of any sale or conveyance of the
Premises by Lessor during the Term hereof, any such sale or conveyance of all or any part
of the Premises shall be subject to this Lease and all of the provisions hereof.
Section 18.10. No Personal Liability. No Leasehold Mortgagee, any successor or
assignee thereof, shall have any personal liability under this Lease for its interest in the
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Lease so long as it does not become the Lessee or assume this Lease, in which event such
Leasehold Mortgagee, successor or assignee thereof, would become liable solely for acts
or omissions arising after becoming the Lessee or assuming the Lease.
Section 19. Counterparts. This Lease may be signed in counterparts, each of which will
be deemed an original, but all of which when taken together will constitute one and the same
instrument.
Section 20. Title. Lessor hereby covenants that it is the sole owner in fee simple of the
Premises, is lawfully seized thereof and has a good right to lease it under the terms and conditions
contained herein; that the Premises are free from any and all liens and encumbrances, except for
the Option Agreement, real estate taxes and assessments not yet due and payable, and any other
matters of record; and that Lessor guarantees the quiet possession thereof by Lessee, its successors
and assigns and will warrant and defend Lessee's rights hereunder against all claims. Lessor
represents that the execution and delivery of this Lease and performance by the Parties of their
obligations pursuant to this Lease will not violate any agreement, instrument, order, judgment,
decree, permit, approval, license, law, regulation or ordinance to which Lessor is a party or by
which Lessor or its assets or the Premises is bound or which otherwise affect the Premises. Lessor
shall indemnify, defend and hold Lessee and its successors and assigns harmless from and against
any and all claims, damages, liabilities, losses, costs and expenses, including, without limitation,
reasonable attorneys' fees and any consequential damages, arising from a breach of the
representations, warranties, guarantees or covenants of Lessor contained in this Section 20.
Section 21. RESERVED.
Section 22. Amendment. No amendments, modifications or revisions shall be made to
this Lease except in a written instrument signed by both Lessor and Lessee.
Section 23. Recitals. The recitals set forth above and the exhibits attached hereto are
hereby incorporated herein.
Section 24. Miscellaneous.
Section 24.1. Limitation of Liability. Anything herein to the contrary
notwithstanding, there shall be absolutely no personal liability on any person, firm, or
entity who constitute the Lessor or Lessee with respect to any of the terms, covenants,
conditions and provisions of this Lease, and Lessee and Lessor shall look solely to the
interest of Lessor or Lessee, their successors and assigns, as applicable, for the satisfaction
of each and every remedy of Lessee or Lessor in the event of default by Lessor or Lessee
hereunder; such exculpation of personal liability is absolute and without any exception
whatsoever.
Section 24.2. No Waiver. No waiver of any default of any obligation by any Party
will be implied from the failure of the other Party to take any action with respect to a
default.
Section 24.3. No Agency. Nothing in this Lease will be deemed or construed by
either Party or by any third person to create the relationship of principal and agent or of
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limited or general partners or of joint ventures or of any other association between the
Parties.
Section 24.4. Termination. This Lease may be terminated (a) by mutual
agreement ofthe'Parties, (b) by Lessor, during any period in which the Project Property is
not used and occupied primarily for residential purposes, in violation of the terms and
conditions of Section 1.2 of this Lease, or ( c) in accordance with the terms of Section 25
ofthis Lease. All of the Parties' rights and obligations under this Lease will cease upon
termination of this Lease, except for those rights and obligations that survive termination
by operation of the express terms of this Agreement.
Section 24.5 Right of Inspection. Lessor shall have the right to enter upon the
Premises at any reasonable time to inspect the Premises.
Section 24.6 Venue. In the event any litigation arises out of or is based upon this
Lease or the relationship between the Parties created by it, jurisdiction for such litigation
shall lie solely with the courts of St. Joseph County, Indiana.
Section 24. 7 Entire Agreement. This Lease shall constitute the entire agreement
between the Parties. Any prior understanding or representation of any kind preceding the
date of this Lease shall not be binding upon either Party except to the extent the same is
incorporated into and set forth by this Lease.
Section 24.8 RESERVED.
Section 24.9 RESERVED.
Section 24.10 Third Party Rights. Nothing contained herein shall be deemed or
construed by Lessor, Lessee, or by any third party to create between Lessor and Lessee any
relationship other than the relationship of Lessor and Lessee.
Section 24.11 Partial Invalidity of Lease. The invalidity or unenforceability of any
particular term or condition of this Lease shall have no effect upon any other term or
condition and this Lease shall be construed in all respects as if such invalid or
unenforceable term or condition had not been contained herein.
Section 24.12 Authority to Execute Lease. Each person executing this Lease on
behalf of Lessor or Lessee represents and warrants that:
(a) he or she has been authorized to execute and deliver this Lease by the entity
for which he or she is signing; and
(b) this Lease is valid and binding upon such entity, enforceable in accordance
with its terms.
Section 24.13. Memorandum of Lease. The Parties hereto shall not record this
Lease but each Party shall execute upon the request of the other a "Memorandum of Lease"
suitable for recording.
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Section 25. New Building and Parking Garage. In the event Lessor disposes of all or
part of the Support Parcel under the terms of the Option Agreement, whether to Developer or a
third party, this Lease shall be terminated in its entirety. The effective date of such termination
will be determined by Lessor in consideration of any arrangements made and property acquired by
Lessor for the construction of the Parking Garage (as such term is defined in the Option
Agreement). Lessor will to provide Lessee at least sixty (60) days' advance written notice of the
termination of this Lease in accordance with this Section 25.
Section 26. Parking During Construction. In the event that Lessor constructs the
Parking Garage in accordance with and subject to the terms of the Option Agreement, Lessor will
provide Lessee with replacement parking spaces within two (2) blocks of the Project Property at
all times after the termination of this Lease under Section 25 until the completion of the Parking
Garage (the "Replacement Parking Spaces"). The total number of Replacement Parking Spaces,
wherever individually located, will be equal to the total number of parking spaces on the Premises
made unavailable to Lessee as a result of the construction of the Parking Garage. Upon completion
of the Parking Garage, Lessor will provide Lessee with access to the Parking Garage and exclusive
use of a number of parking spaces within the first three (3) levels of the Parking Garage equal to
the number of parking spaces on the Premises leased by Lessee under this Lease immediately prior
to the termination of this Lease under Section 25. Such provision of access and use shall be set
forth in a written agreement upon a form reasonably acceptable to Lessee and shall not include
any additional rent or other cost to Lessee (including, without limitation, any maintenance costs).
In addition, the term of such agreement will not exceed the part of the Term of this Lease remaining
at the time this Lease is terminated under Section 25. Lessor shall be responsible for the repair,
replacement and maintenance of the Parking Garage and, upon completion of construction thereof,
shall keep the same in clean, neat and safe condition and in good working and operational order.
This Section 26 shall survive the expiration or earlier termination of this Lease.
Section 27. Continued Access and Use. In the event this Lease expires or is otherwise
partially or wholly terminated in accordance with Section 24.4 of this Lease, upon Lessee's
request, Lessor (i) shall grant easements in, on, under, over, across and upon the Premises for the
benefit of the Project Property as reasonably necessary to provide continued use of the Premises
for utility service boxes and other equipment then serving the Project Property and as reasonably
necessary to allow placement and use of one or more trash dumpsters or similar receptacles
sufficient to serve the Project Property and (ii) will consider providing access and/or utility
easements over a portion of the Parking Parcel for purposes of ingress to and egress from the
Project Property and the Support Parcel, as Lessor deems appropriate in its sole discretion.
Nothing in this Lease will be deemed to require Lessor to grant such easement to Lessee. This
Section 27 shall survive the expiration or earlier termination of this Lease.
[Signature Page Follows.]
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12
IN WITNESS WHEREOF, the undersigned have executed this Lease to be effective as of
the Commencement Date.
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"LESSOR":
SOUTH BEND REDEVELOPMENT
COMMISSION, governing body of the Department
of Redevelopment of the City of South Bend, Indiana
Title: _______________ _
ATTEST:
Printed: ______________ _
Title: ----------------
"LESSEE":
THE LASALLE APARTMENTS, LLC, an Indiana
limited liability company
By: Executive Investments, LLC, its Member
Ronda Shrewsbury W eybright, President
EXHIBIT A
SUPPORT PARCEL
A part of the Westhalf of the Northwest Quarter of Section 12, Township 37 North, Range 2 East,
also known as Lots #2 and #3 in the recorded plan of the Original Plat of the Town (now City) of
South Bend Portage Township, City of South Bend, St. Joseph County, Indiana. [Parcel Key Nos.
018-1002-0041 and 018-1002-0042]
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EXHIBITB
PARKING PARCEL
A part of the West half of the Northwest Quarter of Section 12, Township 3 7 North, Range 2 East,
also known as Lot #10 in the recorded plan of the Original Plat of the Town (now City) of South
Bend Portage Township, City of South Bend, St. Joseph County, Indiana. [Parcel Key No. 018-
1008-0304]
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EXHIBITC
PROJECT PROPERTY
A part of the West half of the Northwest Quarter of Section 12, Township 3 7 North, Range 2 East,
also known as Lot #1 in the recorded plan of the Original Plat of the Town (now City) of South
Bend Portage Township, City of South Bend, St. Joseph County, Indiana. [Parcel Key No. 018-
1002-0040]
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