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HomeMy WebLinkAboutD-1302-97 HazelDell Bond $32mlonnmA c : AN ORDINANCE OF THE COMMON COUNCIL OF THE CITY OF CARMEL, INDIANA, APPROVING A LEASE BETWEEN THE CITY OF CARMEL REDEVELOPMENT AUTHORITY AND THE CITY OF CARMEL REDEVELOPMENT COMMISSION, AND PLEDGING THE COUNTY OPTION INCOME TAX REVENUES OF THE CITY TO PAY CERTAIN OBLIGATIONS AND ADDRESSING MATTERS RELATED THERETO WHEREAS, the City of Carmel Redevelopment Authority (the "Authority") has adopted a resolution indicating its intent to issue its City of Carmel Redevelopment Authority County Option Income Tax Lease Rental Revenue Bonds of 1997 (the "Bonds") for purposes of financing the development of the Plum Creek/Hazeldell Parkway Economic Development Area, the 96th Street/Hazeldell Parkway Economic Development Area, the Pennsylvania Street North Economic Development Area, the Pennsylvania Street South Economic Development Area, the Old Town Economic Development Area, and the 126th Street Corridor Economic Development Area (collectively, the "Economic Development Areas"), each of which has been established by the City of Carmel Redevelopment Commission (the "Commission"), including without limitation the construction of certain projects and improvements described in the economic development plans for the Economic Development Areas, which are located in or directly serve or benefit the Economic Development Areas (the "Projects"); and WHEREAS, the Authority and the Commission have adopted resolutions approving a proposed Lease Agreement in the form presented at this meeting (the "Lease") for the purpose of paying the principal and interest on the Bonds issued pursuant to IC 36-7-14.5 to finance the construction of the Projects, and the Commission scheduled a public hearing regarding the Lease pursuant to IC 36-7-14-25.2 and published a notice of such public hearing pursuant to IC 5-3-1; and WHEREAS, on July 7, 1997, said public hearing was held and all interested parties were provided the opportunity to be heard at the hearing; and WHEREAS, the Commission, at a meeting on July 7, 1997, adopted a resolution finding, pursuant to IC 36-7-14.5-14, that the lease rental payments to be paid by the Commission to the Authority pursuant to the Lease are fair and reasonable and finding, pursuant to IC 36-7-14-25.2, that the terms of the Lease are based upon the value of the Leased Premises and the use of the Projects throughout the term of the Lease will serve the public purpose of City of Carreel and is in the best interests of its residents; and WHEREAS, the Common Council desires to approve the Lease pursuant to IC 36-7-14-25.2, which provides that any lease approved by a resolution of the Commission must be approved by an ordinance of the fiscal body of the unit; and WttEREAS, the Hamilton County Income Tax Council has imposed a county option income tax CCOIT") pursuant to IC 6-3.5-6 (the "Act") on the adjusted gross income of Hamilton County (the "County") taxpayers; and WHEREAS, the annual rentals payable under the Lease will be pledged by the Authority to pay debt service on the Bonds; and WHEREAS, the Common Council may from time to time by ordinance identify any bond, note, wanant or other evidence of indebtedness, any lease or any other obligation, whether issued by the City, the Commission, the Authority or any other person (any bond, note, warrant or other evidence of indebtedness, any lease or any other obligation, whether issued by the City, the Commission, the Authority or any other person, individually, an "Obligation" and, collectively, the "Obligations"), as an obligation secured by this Ordinance (any Obligation so identified as an obligation secured by this Ordinance, individually, a "Secured Obligation" and, collectively, the "Secured Obligations"); and WHEREAS, the Act provides that revenue derived from the imposition of the COIT shall be distributed to the County monthly on the first day of each month (the City's share of each such monthly distribution, a "Monthly Distribution"); and WHEREAS, IC 36-7-14-25.5 authorizes the City to pledge its Monthly Distributions of COIT revenues to pay lease rentals under a lease between the Commission and the Authority entered into pursuant to IC 36-7-14-25.2; NOW, THEREFORE, BE IT ORDAINED BY THE COMMON COUNCIL OF CITY OF CARMEL, INDIAN& as follows: Section 1. Approval of Lease. The Common Council hereby approves the Lease, as approved by the Commission, pursuant to IC 36-7-14-25.2. Section 2. Pledge of Pledged Revenues. The Common Council hereby approves the issuance of the Bonds. Pursuant to IC 36-7-14-25.5, the Common Council, on behalf of the City, hereby pledges and assigns the City's Monthly Distributions of COIT revenues for the payment of the Secured Obligations, including the Lease. The City shall set aside a portion of each Monthly Distribution, during each calendar year beginning with calendar year 1999 through and including the last calendar year during which any Secured Obligation, including the Lease, remains outstanding, which portion shall equal the lesser of (i) all of such Monthly Distribution or (ii) one-twelfth (1/12) of the sum of the amounts payable under the Secured Obligations, including the Lease, which amounts are payable during the twelve (12) month period beginning on January 1 and ending on December 31 of such calendar year (such portion, the "Pledged Revenues"), to pay any amounts payable under the Secured Obligations, including the Lease. Section 3. Obligations. The Common Council hereby identifies the Lease as an obligation secured by this Ordinance. The City shall not identify any Obligation, except the Lease, as an obligation secured by this Ordinance, unless: -2- (a) All interest, principal, rental and other mounts payable under the then outstanding Secured Obligations due on or before such identification have been paid in accordance with their terms; and (b) There is delivered to or for the benefit of each obligee under each then outstanding Secured Obligation a report or certificate prepared by an independent certified public accountant or independent financial advisor to the effect that either: (1) the sum of the Monthly Distributions in the calendar year immediately preceding the calendar year in which such Obligation is so identified were not less than one hundred twenty-five percent (125%) of the maximum interest, principal, rental or other mounts payable under such Obligation and any other then outstanding Secured Obligations in any future calendar year; or (2) the sum of the Monthly Distributions in the calendar year immediately succeeding the calendar year in which such Obligation is so identified are projected to be equal to at least one hundred twenty- five percent (125%) of the maximum interest, principal, rental and other amounts payable under such Obligation and any other then outstanding Secured Obligations in any future calendar year. The Common Council, on behalf of the City, shall not pledge or assign the Pledged Revenues to pay any amounts payable under any Obligations or for any other purpose, except to pay any mounts payable under the Secured Obligations (including the Lease). Nothing in this Ordinance shall prohibit the Common Council from pledging or assigning any revenues derived from the imposition of the COIT, other than the Pledged Revenues, to pay any amounts payable under any Obligations or for any other purpose. Section 4. Tax Covenants. The City represents, covenants and agrees that it will not take any action or fail to take any action that would result in the loss of the exclusion from gross income for federal income tax purposes of interest on the Bonds pursuant to Section 103 of the Internal Revenue Code of 1986, as amended and in affect on the date hereof. Section 5. Creation of Contract; Amendment of Ordinance. (a) The provisions of this Ordinance shall constitute a contract by and between the City and the obligees of the Secured Obligations (including the Lease). A_tier the issuance of any Secured Obligations, the Common Council shall not, except as specifically provided in Section 5(b) or 5(c) hereof, repeal, modify or amend this Ordinance. (b) The Common Council may, from time to time and at any time, without the consent of or notice to any obligees under any Secured Obligations, adopt a supplemental ordinance to modi~j or amend this Ordinance for any one or more of the following purposes: -3- (i) To cure any ambiguity or formal defect or omission in this Ordinance or in any supplemental ordinance; (ii) To grant to or confer upon any obligees under any Secured Obligations any additional benefits, rights, remedies, powers, authority or security that may lawfully be granted to or conferred upon such obligees under such Secured Obligations; (iii) To modify or amend this Ordinance to permit the qualification of any Secured Obligations for sale under the securities laws of the United States of America or any of the states of the United States of America; (iv) To provide for the refunding or advance refunding of any Secured Obligations; (v) To procure a rating on any Secured Obligations from a nationally recognized securities rating agency, designated in such supplemental ordinance, if such supplemental ordinance will not materially adversely affect the interests of any obligees under any Secured Obligations; (vi) To make changes to reflect the identification of any Obligation as an obligation secured by this Ordinance in accordance with Section 3 hereof; or (vii) Any other purpose which, in the judgment of the Common Council, does not materially adversely affect the interests of any obligees under any Secured Obligations. (c) This Ordinance, and the rights and obligations of the City and any obligees under any Secured Obligations, may be modified or amended from time to time at any time by a supplemental ordinance adopted by the Common Council with the consent of the obligees under the Secured Obligations affected by such modification or amendment, holding at least a majority in aggregate principal amount of such Secured Obligations then outstanding (exclusive of Secured Obligations, if any, owned by the City); provided, however, that no such modification or amendment shall, without the express consent of all of the obligees under the Secured Obligations affected by such modification or amendment, permit a privilege or priority of any of such Secured Obligations over any other of such Secured Obligations, or create a lien seaaing any of such Secured Obligations other than a lien ratably securing all of such Secured Obligations, nor shall any such modification or amendment reduce the percentage of consent required for amendment or modification of this Ordinance. -4- Any act done pursuant to a modification or amendment so consented to shall be binding upon all the obligees under the Secured Obligations and shall not be deemed an infringement of any of the provisions of this Ordinance, and may be done and performed as fully and freely as if expressly permitted by the terms of this Ordinance, and, aRer such consent relating to such specified matters has been given, no obligees under the Secured Obligations shall have any right or interest to object to such action or in any manner to question the propriety thereof or to enjoin or restrain the City or any officer thereof from taking any action pursuant thereto. If the City shall desire to obtain any such consent to any modification or amendment of this Ordinance, it shall mail or cause to be mailed a notice, postage prepaid, to the respective obligees under the Secured Obligations affected by such modification or amendment. Such notice shall briefly set forth the nature of the proposed supplemental ordinance and shall state that a copy thereof is on file for inspection by all obligees under such Secured Obligations. The City shall not, however, be subject to any liability to any obligees under any Secured Obligations by reason of its failure to mail the notice described in this Section 5, and any such failure shall not affect the validity of such supplemental ordinance when consented to and approved as provided in this Section 5. Whenever, at any time within one year after the date of the mailing of such notice, the City shall receive an instrument or instruments purporting to be executed by the obligees under such Secured Obligations of not less than a majority in aggregate principal amount of such Secured Obligations then outstanding (exclusive of Secured Obligations, if any, owned by the City), which instrument or instruments shall refer to the proposed supplemental ordinance described in such notice, and shall specifically consent to and approve the adoption thereof in substantially the form of the copy thereof referred to in such notice as on file, thereupon, but not otherwise, the Common Council may adopt such supplemental ordinance in substantially such form, without liability or responsibility to any obligees under the Secured Obligations, whether or not such obligee shall have consented thereto. (d) Upon the adoption of any supplemental ordinance pursuant to the provisions of this Section 5, this Ordinance shall be, and is deemed to be, modified and amended in accordance therewith, and the respective fights, duties and obligations under this Ordinance shall thereafter be determined, exercised and enforced hereunder, subject in all respects to such modifications and amendments. Section 6. Severability. If any part of this Ordinance shall be adjudged to be invalid by a court of proper jurisdiction, it shall be conclusively presumed that the Common Council would have passed the remainder of this Ordinance without such invalid part. Section 7. Repeal of Conflicting Ordinances. All ordinances, resolutions and orders, or parts thereof, in conflict with the provisions of this Ordinance, are, to the extent of such conflict, hereby repealed. -5- Se~'tion 8. Authorization of Other Actions. Each of the Mayor, any member of the Common Council and the Clerk-Treasurer, and any other officer, employee or agent of the City is hereby authorize~ and directed, for and on behalf of the City, to execute and deliver any contract, agreement, certificate, instrument or other document and to take any action as such person determines to be necessary or appropriate to accomplish the purposes of this Ordinance, such determination to be conclusively evidenced by such person's execution of such contract, agreement, certificate, instrument or other document or such person's taking of such action. Section 9. This Ordinance shall be in full force and effect from and after its adoption by the Common Council and upon compliance with the procedures required by law. PASSED by th~ Common Council of the City of Cannel, Indiana this 7/~l'a ;~Z~ y of 1997 by a vote of 5 ayes and C) nays. ~ ' COMMON COUNCIL FOR THE CITY OF CA L P cer , Ronald E. Caster Robert Battreall Bi ;?. Walker ATTEST: Diana L. Cordray, Clerk Presented by me to the Mayor of the City of Carmel, Indiana on this//~lay of/~,./,~, 1997 at c~.. 15 o' clockCh~_~p.m. Diana L. CorT~.y, Clerk-Treasurer ~ In I ! ¢ Approved by me, Mayor of the City of Carmel, d'ana, th's ~ day of Jl~ ,1997 atl$~ t[/~.o'clock a.m./l~. ATTEST: -7- LEASE AGREEMENT between CITY OF CARMEL REDEVELOPMENT AUTHORITY LESSOR and CITY OF CARMEL KEDEVELOPMENT COMMISSION LESSEE Dated as of ,1997 LEASE AGREEMENT THIS LEASE AGREEMENT, made and dated as of this__ day of ,1997, by and between the CITY OF CARMEL REDEVELOPMENT AUTHORITY (the "Lessor"), a separate body corporate and politic organized and existing under Indiana Code 36-7-14.5 as an instrumentality of the City of Carmel, Indiana (the "City"), and the CITY OF CARMEL REDEVELOPMENT COMMISSION (the "Lessee"), the governing body of the City of Carmel Department of Redevelopment acting for and on behalf of the City. WITNESSETH: WHEREAS, the City has created the Lessor under and in pursuance of the provisions of Indiana Code 36-7-14, Indiana Code 36-7-14.5 and Indiana Code 36-7-25 (collectively, the "Act"), for the purpose of financing, constructing, acquiring and leasing to the Lessee certain local public improvements and economic development projects; WHEREAS, the City has created the Lessee to undertake redevelopment and economic development in the City in accordance with the Act; WHEREAS, by adopting Resolution No. 3-1977 (the "Hazeldell Declaratory Resolution") on May 13, 1997, the Lessee found that certain areas in the City designated as the "Plum Creek/Hazeldell Parkway Economic Development Area" and the "96th Street/Hazeldell Parkway Economic Development Area" (collectively, the "Hazeldell Economic Development Areas") are economic development areas under Section 41 of the Act, and approved the Economic Development Plan - Hazeldell Parkway Economic Development Areas, for the Hazeldell Economic Development Areas; WHEREAS, the Hazeldell Declaratory Resolution was, af[er a public hearing was held by the Lessee in accordance with the Act and IC 5-3-1, confirmed by Resolution No. adopted on June 16, 1997; WHEREAS, by adoption of Resolution No. 4-1997 (the "Pennsylvania Declaratory Resolution") on May 13, 1997, the Lessee found that certain areas in the City designated as the "Pennsylvania Street North Economic Development Area" and the "Pennsylvania Street South Economic Development Area" (collectively, the "Pennsylvania Economic Development Areas") (the Hazeldell Economic Development Areas and the Pennsylvania Economic Development Areas collectively, the "Economic Development Areas") are economic development areas under Section 41 of the Act, and approved the Economic Development Plan - Pennsylvania Street Corridor Economic Development Areas for the Pennsylvania Economic Development Areas; WHEREAS, the Pennsylvania Declaratory Resolution was, after a public hearing was held by the Lessee in accordance with the Act and IC 5-3-1, confirmed by Resolution No. __ adopted on June 16, 1997; WHEREAS, the Carreel/Clay Plan Commission and the Common Council of the City approved the creation of each of the Economic Development Areas; WHEKEAS, the Hamilton County Income Tax Council has imposed a county option income tax CCOIT") pursuant to Indiana Code 6-3.5-6 on the adjusted gross income of county taxpayers; WHEREAS, to foster economic development in the City, the City, the Lessor, and the Lessee desire to provide for the construction of, among others, the improvements set forth on Exhibit A hereto (such improvements and the roads on which they are constructed, collectively the "Projects"); WHEREAS, the Act authorizes the Lessor to issue bonds for the purpose of obtaining money to pay the cost of acquiring property or constructing, improving, reconstructing or renovating public improvements; WHEREAS, the costs of the acquisition or construction of the Projects will be paid from proceeds of bonds, to be issued by the Lessor in the maximum principal amount of Thirty-Two Million Dollars ($32,000,000) (the "Bonds"); WHEREAS, the annual rentals to be paid under this Lease by the Lessee will be pledged by the Lessor to pay debt service on and other necessary incidental expenses of the Authority relating to the Bonds to be issued by the Lessor to finance the Projects; WHEREAS, Indiana Code 36-7-14-25.5 authorizes the Common Council of the City to pledge the City's distributive share of COIT revenues to pay rentals under leases between the Lessor and the Lessee under the Act; WHEREAS, pursuant to Ordinance No. , adopted by the Common Council of the City on ,1997, the City has pledged to the Lessee a portion of the City's distributive share of COIT, for the payment of the lease rentals owed by the Lessee under this Lease (such portion, the "COIT Revenues"); WHEREAS, the Lessor has acquired or will acquire interests in the real estate described in Exhibit B (such real estate, together with any roads or other improvements that, on the date hereof, are located thereon, collectively, the "Real Estate"), and such interests shall be for a term no less than the term of this Lease; WHEREAS, the Lessor has acquired or constructed or will acquire or construct the Projects (the Real Estate and the Projects on the Real Estate, collectively, the "Leased Premises") and will acquire any Projects completed before the issuance of bonds by the Lessor to pay for the Projects; WHEREAS, the total cost of the Projects, including, but not limited to, costs of acquisition, construction, improvements, architects' and engineers' fees, consultants' services, legal and financing expenses, certain expenses of operation of the Lessor during construction, interest during construction and repayment of any funds advanced by the City or Lessee to meet preliminary expenses necessary to be paid prior to the issuance of bonds by the Lessor, is estimated to be not greater than Thirty-Eight Million Four Hundred Thirty-Two Thousand Dollars ($38,432,000); -2- WHEREAS, the Lessee has determined, after a public hearing held pursuant to the Act after notice given pursuant to IC 5-3-1, that the lease rentals provided for in this Lease are fair and reasonable, that the execution of this Lease is necessary and that the service provided by the Projects will serve the public purpose of the City and is in the best interests of its residents, and the Common Council of the City has by ordinance approved this Lease, and the ordinance has been entered in the official records of the Common Council; and WHEREAS, the Lessor has determined that the lease rentals provided for in this Lease are fair and reasonable, that the execution of this Lease is necessary and that the service provided by the Projects will serve the public purpose of the City and is in the best interests of its residents, and the Lessor has duly authorized the execution of this Lease by resolution, and the resolution has been entered in the official records of the Lessor; TH/S AGREEMENT WITNESSETH THAT: 1. Completion of Projects. The date by which (i) the Lessor completes the acquisition of the interests in the Real Estate and the acquisition or construction of the Projects and (ii) the Real Estate and the Projects are ready for use and occupancy shall be endorsed on this Lease at the end hereof by the parties to this Agreement, and such endorsement shall be recorded as an addendure to this Lease. 2. Premises, Term and Warranty. The Lessor does hereby lease, demise and let to Lessee all of the Lessor's right, title and interests in and to the Leased Premises. TO HAVE AND TO HOLD the Leased Premises with all rights, privileges, easements and appurtenances thereunto belonging, unto the Lessee, beginning on the date on which the Leased Premises are completed and ready for use and occupancy and ending on the day prior to a date not more than twenty-three (23) years thereafter. However, the term of this Lease will terminate at the earlier of (a) the exercise by the Lessee of the option to purchase the Leased Premises pursuant to Section 12 and the payment of the option price, or (b) the payment or defeasance of all bonds issued (i) to finance the cost of the Leased Premises, (ii) to refund all or a portion of such bonds, (iii) to refund all or a portion of such refunding bonds, or (iv) to improve the Leased Premises; provided that no bonds or other obligations of the Lessor issued to finance the Leased Premises remain outstanding at the time of such payment or defeasance. The Lessor hereby represents that it is possessed of, or will acquire, the Leased Premises and the Lessor warrants and will defend the Leased Premises against all claims whatsoever not suffered or caused by the acts or omissions of the Lessee or its assigns. 3. (a) Fixed Rental Payments. The Lessee agrees to pay fixed annual rental for the use and occupancy of the Leased Premises at the total annual rate of Three Million One Hundred Forty-Three Thousand Dollars ($3,143,000) (the "Fixed Annual Rentals"). The Fixed Annual Rentals shall be payable in advance in semiannual installments on the dates set forth in Section 4. At~er the sale of the Bonds issued to finance the acquisition and construction of the Leased Premises, the semiannual installment of the Fixed Annual Rentals for the Leased Premises for each -3- six-month period ending on each June 15 or December 15 (each a "Semiannual Period") shall be reduced to an mount equal to the multiple of $1,000 next higher than the sum of principal and interest due on the Bonds in such Semiannual Period, plus Five Thousand Dollars ($5,000). Payment of the Fixed Annual Rentals shall commence on the later of the date the Leased Premises are completed and ready for use and occupancy or June 15, 1999. The amount of each semiannual installment of such reduced Fixed Annual Rentals shall be endorsed on this Lease by the parties hereto at the time of issuance of the Bonds and recorded as an addendum. If more than one series of Bonds is issued, the addendum shall be executed and recorded upon issuance of the final series of Bonds. (b) Additional Rental Payments. (i) The Lessee shall pay as further rental in addition to the rentals paid under Section 3(a) for the Leased Premises ("Additional Rentals") the amount of all taxes and assessments levied against or on account of the Leased Premises or the receipt of lease rental payments and the amount required to reimburse the Lessor for any insurance payments made by it under Section 7. Any and all such payments shall be made and satisfactory evidence of such payments in the form of receipts shall be furnished to the Lessor by the Lessee, at least three (3) days before the last day upon which such payments must be paid to avoid delinquency. ff the Lessee shall in good faith desire to contest the validity of any such tax or assessment, the Lessee shall so notify the Lessor and shall furnish bond with surety to the approval of the Lessor conditioned for the payment of the charges so desired to be contested and all damages or loss resulting to the Lessor from the nonpayment thereof when due, the Lessee shall not be obligated to pay the contested amounts until such contests shall have been determined. The Lessee shall also pay as Additional Rentals the mount calculated by or for the Lessor as the amount required to be rebated, or paid as a penalty, to the United States of America under Section 148(f) of the Internal Revenue Code of 1986, as mended and in effect on the date of issue of the Bonds ("Code"), after taking into account other available moneys, to prevent the Bonds from becoming arbitrage obligations under Section 148 of the Code. (ii) The Lessee may by resolution pay Additional Rentals to enable the Lessor to redeem or purchase Bonds prior to maturity. Rental payments due under this Section 3 shall be reduced to the extent such payments are allocable to the Bonds redeemed or purchased by the Lessor with such Additional Rentals. The Lessee shall be considered as having an ownership interest in the Leased Premises valued at an mount equal to the amount of the Additional Rentals paid pursuant to this subsection (b)(ii). (c) Source of Payment of Rentals. The Fixed Annual Rentals and the Additional Rentals shall be payable solely from the COIT Revenues received by the Lessee from the City, and the Lessee shall be under no obligation to pay any Fixed Annual Rentals or Additional Rentals from any moneys or properties of the Lessee except the COIT Revenues received by the Lessee from the City. 4. Payment of Rentals. (a) The first lease rental payment on the Leased Premises shall be due on the later of June 15, 1999, or the date the Leased Premises are completed and ready for use and occupancy. The date the Leased Premises are completed and ready for use and occupancy shall be endorsed on this Lease on the end hereof by the Lessor and the Lessee as soon as possible after such completion and such endorsement shall be recorded with the Hamilton County Recorder -4- as an addendum to this Lease. If the first rental payment date on the Leased Premises is other than June 15 or December 15, the first rental payment shall be for an amount calculated at the rate for that Semiannual Period from the date of payment to the next June 15 or December 15. Thereafter, rentals on the Leased Premises shall be payable in advance in semiannual installments on June 15 and December 15 of each year. The last semiannual rent payment on the Leased Premises due shall be adjusted to provide for a rental payment at the rate specified above from the date such installment is due to the expiration of this Lease. (b) All rentals payable under the terms of this Lease shall be paid by the Lessee to the bank designated as trustee ("Trustee") under the Trust Indenture between it and the Lessor ("Indenture"), or to such other bank or trust company as may from time to time succeed such bank as Trustee under the Indenture securing the bonds to be issued by the Lessor to finance the acquisition and construction of the Leased Premises. Any successor trustee under the Indenture shall be endorsed on this Lease at the end hereof by the parties hereto as soon as possible after selection, and such endorsement shall be recorded as an addendure to this Lease. All payments so made by the Lessee shall be considered as payment to the Lessor of the rentals payable hereunder. 5. Abatement of Rent. If any part of the Leased Premises is taken under the exercise of the power of eminent domain, so as to render it unfit, in whole or part, for use or occupancy by the Lessee, it shall then be the obligation of the Lessor to restore and rebuild that portion of the Leased Premises as promptly as may be done, unavoidable strikes and other causes beyond the control of the Lessor excepted; provided, however, that the Lessor shall not be obligated to expend on such restoration or rebuilding more than the condemnation proceeds received by the Lessor. If any part of the Leased Premises shall be partially or totally destroyed, or is taken under the exercise of the power of eminent domain, so as to render it unfit, in whole or part, for use or occupancy by the Lessee, the rent shall be abated for the period during which the Leased Premises or such part thereof is unfit or unavailable for use or occupancy, and the abatement shall be in proportion to the percentage of the Leased Premises which is unfit or unavailable for use or occupancy. 6. Maintenance. Alterations and Repairs. The Lessee may enter into agreements with one or more other parties for the operation, maintenance, repair and alterations of all or any portion of the Leased Premises. Such other parties may assume all responsibility for operation, maintenance, repairs and alterations to the Leased Premises. At the end of the term of this Lease, the Lessee shall deliver the Leased Premises to the Lessor in as good condition as at the beginning of the term, reasonable wear and tear only excepted. 7. Insurance. During the full term of this Lease, the Lessee shall, at its own expense, carry combined bodily injury insurance, including accidental death, and property damage insurance with reference to the Leased Premises in an amount not less than One Million Dollars ($1,000,000) on account of each occurrence with one or more good and responsible insurance companies. Such public liability insurance may be by blanket insurance policy or policies. -5- The proceeds of the public liability insurance required herein (after payment of expenses incurred in the collection of such proceeds) shall be applied toward extinguishment or satisfaction of the liability with respect to which such insurance proceeds are paid. Such policies shall be for the benefit of persons having an insurabie interest in the Leased Premises, and shall be made payable to the Lessor, the Lessee,' and the Trustee and to such other person or persons as the Lessor may designate. Such policies shall be countersigned by an agent of the insurer who is a resident of the State of Indiana and deposited with the Lessor and the Trustee. If, at any time, the Lessee fails to maintain insurance in accordance with this Section, such insurance may be obtained by the Lessor and the amount paid therefor shall be added to the amount of rentals payable by the Lessee under this Lease; provided, however, that the Lessor shall be under no obligation to obtain such insurance and any action or non-action of the Lessor in this regard shall not relieve the Lessee of any consequence of its default in failing to obtain such insurance. The insurance policies described in this Section 7 may be acquired by another party and shall satisfy this Section as long as the Lessor, the Lessee and the Trustee are named as additional insureds under such policies. Such coverage may be provided by scheduling it under a blanket insurance policy or policies. 8. Eminent Domain. If title to or the temporary use of the Leased Premises, or any part thereof, shall be taken under the exercise or the power of eminent domain by any governmental body or by any person, firm or corporation acting under govemmental authority, any net proceeds received from any award made in such eminent domain proceedings (after payment of expenses incurred in such collection) shall be paid to and held by the Trustee under the Indenture. Such proceeds shall be applied in one or more of the following ways: (a) The restoration of the Leased Premises to substantially the same condition as it existed prior to the exercise of that power of eminent domain, or The acquisition, by construction or otherwise, of other improvements suitable for the Lessee's operations on the Leased Premises and which are in furtherance of the purposes of the Act and the Plan (the improvements shall be deemed a part of the Leased Premises and available for use and occupancy by the Lessee without the payment of any rent other than as herein provided, to the same extent as if such other improvements were specifically described herein and demised hereby). Within ninety (90) days from the date of entry of a final order in any eminent domain proceedings granting condemnation, the Lessee shall direct the Lessor and the Trustee in writing as to which of the ways specified in this Section the Lessee elects to have the net proceeds of the condemnation award applied. Any balance of the net proceeds of the award in such eminent domain proceedings not required to be applied for the purposes specified in subsections (a) or (b) above shall be deposited in the sinking fund held by the Trustee under the Indenture and applied to the repayment of the Bonds. -6- The Lessor shall cooperate fully with the Lessee in the handling and conduct of any prospective or pending condemnation proceedings with respect to the Leased Premises or any part thereof and will to the extent it may lawfully do so permit the Lessee to litigate in any such proceedings in its own name or in the name and on behalf of the Lessor. In no event will the Lessor voluntarily settle or consent to the settlement of any prospective or pending condemnation proceedings with respect to the Leased Premises or any part thereof without the written consent of the Lessee, which consent shall not be unreasonably withheld. 9. General Covenant. The Lessee shall not assign this Lease or mortgage, pledge or sublet the Leased Premises herein described, except as provided in Section 6, without the written consent of the Lessor. The Lessee shall contract with the other parties to use and maintain the Leased Premises in accordance with the laws, regulations and ordinances of the United States of America, the State of Indiana, the City and all other proper governmental authorities. 10. Tax Covenants. In order to preserve the exclusion of interest on the Bonds from gross income for federal income tax purposes and as an inducement to purchasers of the Bonds, the Lessee and the Lessor represent, covenant and agree that neither the Lessor nor the Lessee will take any action or fail to take any action with respect to the Bonds, this Lease or the Leased Premises that will remit in the loss of the exclusion from gross income for federal tax purposes of interest on the Bonds under Section 103 of the Code, nor will they act in any other manner which will adversely affect such exclusion; and it will not make any investment or do any other act or thing during the period that the Bonds are outstanding which will cause any of the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code. The covenants in this Section are based solely on current law in effect and in existence on the date of issuance of the Bonds. It shall not be an event of default under this Lease if interest on any Bonds is not excludable from gross income pursuant to any provision of the Code which is not in existence and in effect on the issue date of the Bonds. All officers, members, employees and agents of the Lessor and the Lessee are authorized to provide certifications of facts and estimates that are material to the reasonable expectations of the Lessor and the Lessee as of the date the Bonds are issued and to enter into covenants on behalf of the Lessor and the Lessee evidencing the Lessor's and the Lessee's commitments made herein. In particular, all or any members or officers of the Lessor and the Lessee are authorized to certify and enter into covenants regarding the facts and circumstances and reasonable expectations of the Lessor and the Lessee on the date the Bonds are issued and the commitments made by the Lessor and the Lessee herein regarding the amount and use of the proceeds of the Bonds. 11. Option to Renew. The Lessor hereby grants to the Lessee the fight and option to renew this Lease for a further like or lesser term upon the same or like conditions as herein contained, and applicable to the portion of the premises for which the renewal applies, and the Lessee shall exercise this option by written notice to the Lessor given upon any rental payment date prior to the expiration of this Lease. -7- 12. Option to Purchase. The Lessor hereby grants to the Lessee the right and option, on any date, upon sixty (60) days' written notice to the Lessor, to purchase the Leased Premises, or any portion thereof; at a price equal to the amount required to pay all indebtedness incurred on account of the Leased Premises, or such portion thereof (including indebtedness incurred for the refunding of that indebtedness), including all premiums payable on the redemption thereof and accrued and unpaid interest, and including the proportionate share of the expenses and charges of liquidation, if the Lessor is to be then liquidated. In no event, however, shall such purchase price exceed the capital actually invested in such property by the Lessor represented by outstanding securities or existing indebtedness plus the cost of transferring the property and liquidating the Lessor. The phrase "capital actually invested" as used herein shall be construed to include, but not by way of limitation, the following amounts expended by the Lessor in connection with the acquisition and financing of the Leased Premises: organization expenses, financing costs, carry charges, legal fees, architects' fees and reasonable costs and expenses incidental thereto. Upon request of the Lessee, the Lessor agrees to furnish an itemized statement setting forth the amount required to be paid by the Lessee in order to purchase the Leased Premises in accordance with the preceding paragraph. Upon the exercise of the option to purchase granted herein, the Lessor will upon payment of the option price deliver, or cause to be delivered, to the Lessee documents conveying to the Lessee, or any entity (including the City) designated by the Lessee, all of the Lesso?s title to the property being purchased, as such property then exists, subject to the following: (i) those liens and encumbrances (if any) to which title to the property was subject when conveyed to the Lessor; (ii) those liens and encumbrances created by the Lessee and to the creation or suffering of which the Lessee consented, and liens for taxes or special assessments not then delinquent; and (iii) those liens and encumbrances on its part contained in this Lease. In the event of purchase of the Leased Premises by the Lessee or conveyance of the Leased Premises to the Lessee or the Lessee's designee, the Lessee shall procure and pay for all surveys, title searches, abstracts, title policies and legal services that may be required, and shall furnish at the Lessee's expense all documentary stamps or tax payments required for the transfer of title. Nothing contained herein shall be construed to provide that the Lessee shall be under any obligation to purchase the Leased Premises, or under any obligation respecting the creditors, members or security holders of the Lessor. 13. Transfer to Lessee. If the Lessee has not exercised its option to renew in accordance with the provisions of Section 11, and has not exercised its option to purchase the Leased Premises, or any portion thereof, in accordance with the provisions of Section 12, and upon the full discharge and performance by the Lessee of its obligations under this Lease, the Leased Premises, or such portion thereof remaining, shall thereupon become the absolute property of the Lessee, subject to the limitations, if any, on the conveyance of the site for the Leased Premises to the Lessor and, upon the Lessee's request the Lessor shall execute proper instruments conveying to the Lessee, or to any entity (including the City) designated by the Lessee, all of Lessor's title to the Leased Premises, or such portion thereof. -8- 14. Defaults. If the Lessee shall default (a) in the payment of any rentals or other sums payable to the Lessor hereunder, or in the payment of any other sum herein required to be paid for the Lessor; or (b) in the observance of any other covenant, agreement or condition hereof, and such default shall continue for ninety (90) days a~er written notice to correct such default; then, in any or either of such events, the Lessor may proceed to protect and enforce its fights by suit or suits in equity or at law in any court of competent jurisdiction, whether for specific performance of any covenant or agreement contained herein, or for the enforcement of any other appropriate legal or equitable remedy; or the Lessor, at its option, without further notice, may terminate the estate and interest of the Lessee hereunder, and it shall be lawful for the Lessor forthwith to resume possession of the Leased Premises and the Lessee covenants to surrender the same forthwith upon demand. The exercise by the Lessor of the above fight to terminate this Lease shall not release the Lessee from the performance of any obligation hereof maturing prior to the Lessor's actual entry into possession. No waiver by the Lessor of any right to terminate this Lease upon any default shall operate to waive such fight upon the same or other default subsequently occurring. 15. Notices. Whenever either party shall be required to give notice to the other under this Lease, it shall be sufficient service of such notice to deposit the same in the United States mail, in an envelope duly stamped, registered and addressed to the other party or parties at the following addresses: (a) to Lessor: City of Carmel Redevelopment Authority, Attention: President, One Civic Square, Carreel, Indiana 46032; (b) to Lessee: City of Carreel Redevelopment Commission, Attention: President, One Civic Square, Carreel, Indiana 46032. The Lessor, the Lessee and the Trustee may by notice given hereunder, designate any further or different addresses to which subsequent notices, certificates, requests or other communications shall be sent. 16. Successors or Assigns. All covenants of this Lease, whether by the Lessor or the Lessee, shall be binding upon the successors and assigns of the respective parties hereto. 17. Construction of Covenants. The Lessor was organized for the purpose of acquiring, constructing, equipping and renovating local public improvements and leasing the same to the Lessee under the provisions of the Act. All provisions herein contained shall be construed in accordance with the provisions of the Act, and to the extent of inconsistencies, if any, between the covenants and agreements in this Lease and the provisions of the Act, the Act shall be deemed to be controlling and binding upon the Lessor and the Lessee; provided, however, any amendment to the Act a~er the date hereof shall not have the effect of amending this Lease. -9- IN WITNESS WHEREOF, the parties hereto have caused this Lease to be executed for and on their behalf on the date first written above. LESSOR: LESSEE: CITY OF CARMEL REDEVELOPMENT AUTHORITY CITY OF CAKMEL REDEVELOPMENT COMMISSION By: By: President President ATTEST: ATTEST: Secretary Secretary This instrument was prepared by Richard J. Hall, Barnes & Thornburg, 11 South Meridian Street, Indianapolis, Indiana 46204. -10- STATE OF INDIANA COUNTY OF HAMILTON ) ) ss: ) Before me, the undersigned, a Notary Public in and for this City and State, personally appeared and , personally known to be the President and Secretary, respectively, of the City of Carmel Redevelopment Authority (the "Authority"), and acknowledged the execution of the foregoing Lease for and on behalf of the Authority. WITNESS my hand and notarial seal this day of ,1997 (Written Signature) (Primed Signature) (Seal) Notary Public My Commission Expires: My City of Residence: -11- STATE OF INDIANA COUNTY OF HAMILTON ) ) ss: ) Before me, the undersigned, a Notary Public in and for this City and State, personally appeared and , personally known to be the President and Secretary, respectively, of the City of Camel Kedevelopment Commission (the "Commission"), and acknowledged the execution of the foregoing Lease for and on behalf of the Commission. WITNESS my hand and notaxial seal this day of ,1997. (Written Signature) (Printed Signature) (Seal) Notary Public My Commission Expires: My City of Residence: -12- EXHIBIT A DESCRIPTION OF PROJECTS The construction of certain improvements to increase the traffic capacity of the existing Hazeldell Parkway and the construction of an extension of Hazeldell Parkway south to intersect with 961h Street. , The construction of certain improvements to increase the traffic capacity of the existing Pennsylvania Street and the construction of an extension to connect Pennsylvania Street between 103rd Street and 131st Street. EXHIBIT B DESCRIPTION OF REAL ESTATE The general descriptions attached hereto shall be replaced with formal legal descriptions of the Real Estate when all of the Real Estate has been acquired by the Lessor. INDS01 RXH 205679 Hazel Dell Parkway Boundary Description 961h Street to 1461h Street A part of Section 9, Township 17 North, Range 4 East, a part of Section 4, Township 17 North, Range 4 East, a part of Section 33, Township 18 North, Range 4 East, a part of Section 34, Township 18 North, Range 4 East, a part of Section 28, Township 18 North, Range 4 East, a part of Section 27, Township 18 North, Range 4 East, a part of Section 21, Township 18 North, Range 4 East, and a part of Section 22, Township 18 North, Range 4 East lying in Clay Township, Hamilton County, Indiana and generally described as follows: A parcel of land varying in width from a minimum of approximately 85 feet to a maximum of approximately 200 feet lying on either side of the centerline of the proposed Hazel Dell Parkway project and extending from 96m Street to 146tn Street, said centerline more particularly described as follows: Beginning at a point on 96th Street approximately 25 feet west of and 31 feet north of the southeast comer of the southwest quarter of said section 9; thence northerly approximately 1200 feet; thence northeasterly approximately 1100 feet; thence north-northeasterly approximately 3400 feet to the north line of said section 9; thence northeasterly approximately 1800 feet; thence north-northwesterly approximately 3900 feet to the north line of said section 4, said section line also being the centerline of 116th Street; thence north-northwesterly approximately 1000 feet; thence north-northeasterly approximately 3000 feet; thence northerly approximately 12,100 feet to the northeast comer of said section 21, said point also being in the centerline of 146th Street and the terminus of the project centerline. Also included in the right-of way boundary are areas of east-west street rights-of-way extending up to approximately 500 feet in either or both directions at their intersection with Hazel Dell Parkway, including 106th Street, 116th Street, 126th Street, 13 1't Street and 146th Street. The total project is approximately 5.2 miles in length and will include both city owned right-of-way and easements. Pennsylvania Street Boundary Description Road Improvements from 103~a Street to 131't Street A part of Section 11, Township 17 North, Range 3 East, part of Section 2, Township 17 North, Range 3 East, part of Section 35, Township 18 North, Range 3 East, and a part of Section 26, Township 18 North, Range 3 East, lying in Clay Township, Hamilton County, Indiana, and generally described as follows: A parcel of land varying in width from a minimum of approximately 90 feet to a maximum of approximately 120 feet lying on either side of the centerline of the proposed Pennsylvania Street project and extending from 103rd Street to 13 1st Street, said centerline more particularly described as follows: Beginning at the intersection of the centerline of 103rd Street and the west quarter-section line of the northeast quarter of the said Section 11; thence north along said quarter-section line approximately 1275 feet; thence north-northwesterly approximately 520 feet; thence northerly approximately 207 feet to the north line of said section 11, said line also being the south line of said section 2; thence northerly approximately 1126 feet; thence north-northeasterly approximately 465 feet; thence northerly approximately 1084 feet to the north line of the southwest quarter of said section 2; thence north- northeasterly approximately 500 feet; thence northeasterly approximately 767 feet; thence northerly approximately 1400 feet to the north line of the northeast quarter of said section 2; thence north- northeasterly approximately 348 feet; thence north-northeasterly approximately 1456 feet; thence north- northwesterly approximately 300 feet; thence north-northeasterly approximately 517 feet to the north line of the southwest quarter of said section 35; thence north-northeasterly approximately 2622 feet to the north line of the northwest quarter of said section 35; thence northerly approximately 987 feet; thence north-northwesterly approximately 231 feet; thence northerly approximately 813 feet; thence north- northwesterly approximately 246 feet; thence northerly approximately 363 feet to the north line of the southwest quarter of said section 26, which is the terminus of the project centerline, also being in the centerline of the existing 13 1st Street. Also included in the right-of-way boundary are areas of east-west street rights-of-way extending up to 500 feet in both directions at their respective intersections with the Pennsylvania Street, including 103rd Street, 106th Street, 111th Street, 116th Street, Old Meridian Street, Carmel Drive and 13 1st Street. The total project is approximately 2.9 miles in length and will include both city owned right-of-way and easements. Financing Summary (As prepared by H.J. Umbaugh & Associates) The City proposes to make public improvements at the following areas: Hazeldell Parkway Pennsylvania Street 126th Street extension East Main and 4th Street intersection Old Town improvements - Phase I Old Town improvements - Phase II $20,200,000 4,420,000 3,007,500 295,000 2,030,400 1,825,000 Funding for the above projects is anticipated to be provided from $32 million of COIT Lease Rental Bonds, interest earnings on the bond proceeds, and approximately $5,929,600 of monies from the General Fund. The security for the Bonds is lease rental payable solely from COIT. A Lease Agreement is proposed between the City of Carreel Redevelopment Authority and the City of Carmel Redevelopment Commission. The repayment of the Bonds would be within the 23 year term of the Lease. The financial terms within the Lease Agreement provide for a maximum annual lease rental payment of $3,143,000. The basic purpose of the lease rental is to provide the payments necessary to support the debt service of the Bonds (and other minor administrative costs such as trustee fees, etc.) and therefore the Lease Agreement provides for the lease rental to be reduced to only what is necessary for such payments. Lease rental payments would commence when the improvements at Hazeldell and Pennsylvania are completed or June 15, 1999, whichever is later. It would be cumbersome to attempt to lease the actual property at each of the improvement sites listed above. Consequently, the Lease Agreement and financing plan anticipates that the "leased property" will be the Hazeldell and Pennsylvania areas only. The purchase price of this property will be approximately $7,158,000. This amount of money will be received by the City to make the improvements anticipated at 1261h Street, East Main and 4th Street, and the Old Town improvements CITY OF CARMEL REDEVELOPMENT AUTHORITY COUNTY OPTION INCOME TAX LEASE RENTAL REVENUE BONDS OF 1997 Proposed Timetable 6/06/97 Dat~ DONE DONE DONE DONE DONE Thursday 6/12/97 (Tentative) Monday 6/16/97 Description · Mayor solicits individuals to serve as the three (3) members of the City of Carmel, Indiana Redevelopment Authority (the "Authority") · Common Council adopts an ordinance to establish Authority, Mayor appoints members · City of Carmel, Indiana Redevelopment Commission (the "Redevelopmerit Commission") meets and adopts declaratory resolution designating economic development areas and approving economic development plans .. Plan Commission approves declaratory resolution designating economic development areas and plans · Common Council approves economic development areas and plans · Redevelopment Commission publishes and delivers notice of public hearings on lease and declaratory resolution related to economic development area (one time at least 10 days before hearing) · Redevelopment Authority meets, elects officers, and adopts reimbursement resolution and resolution approving form of lease · Redevelopment Commission conducts public hearing and adopts resolution confuming the designation of the economic development areas and plans; Commission also adopts resolution approving form of lease and authorizing publication of notice of public hearing on lease · Common Council introduces ordinance approving lease and approving use of COlT revenues for the payment of rentals thereunder Responsible Party IC IC, B&T IC, B&T IC, B&T, Wabash IC, B&T, Wabash B&T, IC IC, B&T IC, B&T, Wabash IC, B&T, Umbaugh Date Friday 6/20/97 Monday 7/07/97 Week of 7/07/97 Thursday 7/10/97 Prior to 8/01/97 Description Redevelopment Commission publishes notice of public heating on lease (one time at least 10 days before heating) Redevelopment Commission holds public heating on lease and adopts resolution finding that lease rentals are fair and reasonable and pledging COIT revenues for payment of lease Common Council adopts ordinance approving lease and approving use of COlT revenues for the payment of rentals thereunder Commence bidding process on Hazeldell project Authority and Redevelopment Commission execute lease and publish notice thereof Authority meets and adopts resolution authorizing issuance of bonds and approving forms of indenture, continuing disclosure contract, preliminary official statement and bond purchase agreement Responsible Party IC, B&T IC, B&T, Umbaugh IC, B&T, Umbaugh ACE, IC IC, B&T IC, B&T, Umbaugh Week of 8/04/97 8/13/97 8/14/97 8/15/97 Bids received on Hazeldell project Publish notice of intent to sell bonds · Notify prospective bidders of bond sale · Bonds priced and sold Publication of notice of execution of bond purchase contract (commencement of 15 day statute of limitations on objection to validity of the bonds) ACE, IC IC, Umbaugh, B&T Umbaugh Umbaugh, IC, B&T B&T -2- Date Week of 8/25/97 cbmg Description Responsible Party All IC = Dcbra Grisham, as counsel to the City of Cannel Umbaugh = H.J. Umbaugh & Associates Wabash = Wabash Scientific, Inc. B&T = Barnes & Thornburg ACE = American Engineers, Ine. INDS01 RXH 196~ -3-