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d SpUTZ(g� 04,11�rICr r o Community & Economic Development " �B S 1200 County-City Building, 227 West Jefferson, South Bend, Indiana 46601-1830. Phone 574/235-9371 Fax 574/235-9021 To: South Bend Redevelopment Commission From: Don Inks Subject: Memorandum Of Understanding with F Cubed Date: November 6, 2012 Attached for your review is Memorandum of Understanding (MOU) with F Cubed. F Cubed is one of the first companies to graduate from Innovation Park. They would like to locate their growing business in Ignition Park when a multi-tenant facility is available for them to lease space. In the interim they will be locating in the former St. Joseph High School. As part of our efforts to retain this company in South Bend, and eventually have them locate in Ignition Park, the MOU commits Redevelopment to acquiring certain scientific equipment and providing an opportunity for F Cubed to lease the equipment. The cost of the equipment is estimated to be $125,489. With a contingency of about 10%the total is expected to not exceed $138,000. F Cubed is an emerging company engaged in the development of a technology for the rapid and direct detection of DNA to be utilized for the identification of contaminated drinking water, medical diagnostics in retail medical clinics and homeland defense. The company currently is located at Innovation Park. They will be temporarily moving to the former St. Joseph High School, with the desire and intent to move to Ignition Park when a multi-tenant facility becomes available. As part of an incentive package to retain F Cubed in the community, the Redevelopment Commission is being asked to acquire and lease certain scientific equipment to F Cubed. Subject to the Redevelopment Commission completing the acquisition and subsequent disposition process as required by state law, the following are the proposed terms of a lease for this equipment. The initial Term of the lease is 7 years. Rental payments total $7 for the seven years. Upon F Cubed locating in Ignition Park, or another site within the Airport Economic Development Area (AEDA), F Cubed has the option to buy the equipment for $1. Should F Cubed not locate within the AEDA during the term of the lease, then F Cubed shall be required to purchase the equipment for 150% of cost. F Cubed expects the equipment will allow them to create approximately 13 jobs and result in new capital investment of$2,647,550. Staff recommends favorable approval of this MOU, and proceeding with the acquisition of equipment for not more than $138,000. What We Do Today Makes A Dtlfer+ence!