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HomeMy WebLinkAboutWallack Somers & Haas - Loans to Carmel Theater Development Company - 6/30/09WALLACK SOMERS 6rHAASK Attorneys at Law June 30, 2009 The City of Carmel Redevelopment Commission Regions Bank One Indiana Square, Suite 227 Indianapolis, Indiana 46204 Hall, Render, Killian, Heath & Lyman, P.C. Suite 2000, Box 82064 One American Square Indianapolis, IN 46282 Re: Loan (the "Loan ") to Carmel Theater Development Company, LLC ( "the Borrower "), a "Qualified Developer" under the terms of that certain Master Loan Program Agreement dated December 30, 2008, as amended by that certain First Amendment to Master Loan Program Agreement dated as of Marchl9, 2009 (collectively, the "MLPA "), between The City of Carmel Redevelopment Commission ( "CRC ") and Regions Bank (the "Lender ") Ladies and Gentlemen: BARRY Z. WALLACK MICHAEL S. WALLACX GEORGE W. SOMERS KARL R HAAS JENNIFER R. SHOUP MARK L. Boos SAMUEL J. ARENA RYAN R. WILMERING We are counsel for CRC, which is a redevelopment commission established by the Common Council of the City of Carmel, Indiana, pursuant to Indiana Code 36 -7 -14, as amended. A. Documents Executed. In connection with the making by Lender of the Loan to Borrower, CRC has executed the following documents: 1. Collateral Assignment, Lock Box, and Security Agreement (Theater Building Base Structure) of even date herewith executed by and among Lender, Borrower, and CRC (the "Collateral Assignment "); 2. Base Structure Installment Purchase Contract of even date herewith executed by and between CRC and Borrower (the "Installment Contract "); and 3. Tri -Party Agreement (Theater Building Base Structure) of even date herewith executed by and among Lender, Borrower, and CRC (the "Tri -Party Agreement "). The Collateral Assignment, the Installment Contract, and the Tri -Party Agreement, collectively, are the "Agreements ". B. Documents Reviewed. In connection with the execution by CRC of the Agreements and rendering this opinion, we have examined the following documents: Tel: 317.231.9000 One Indiana Square, Suite 1500 Indianapolis, Indiana 46204 www.WSHLaw.com Fax: 317.231.9900 m • 0 1. Resolution Certificates (the "Certificates "): (a) the first of which is dated as of January, 2009; (b) the second of which is dated as of May 7, 2009; and (c) the third of which is dated of even date herewith; with respect to CRC Resolution 2008 -11 (the "Resolution "); 2. All other proceedings of CRC in connection with the Agreements, the Loan, the MLPA, and the Loan Program (as defined in the MLPA); 3. The executed Agreements, together with all exhibits attached to the Agreements; and 4. Such laws of the State of Indiana as are necessary in order to render this opinion. C. Opinions Rendered. Based upon the foregoing, in reliance upon the representations set forth in the Certificates, and subject to the qualifications, assumptions, and exceptions set forth below, it is our opinion that: 1. CRC has been created and is validly existing under the provisions of Indiana Code 36 -7 -14, as amended, with the power and authority to: (a) enter into the Agreements; and (b) satisfy its obligations under the Agreements. 2. All proceedings and actions had, taken, or approved by CRC with regard to: (a) the authorization, execution, and delivery of the Agreements; and/or (b) the payment or performance by CRC of its obligations under the Agreements; comply with all applicable laws of the State of Indiana, and with all applicable resolutions, by -laws, rules, and regulations of CRC (including, without limitation, the Resolution). 3. None of the proceedings or actions had, taken, or approved by CRC with regard to: (a) the authorization, execution, and delivery of the Agreements; or (b) the payment or performance by CRC of its obligations under the Agreements; has been amended, repealed, rescinded, or revoked (including, without limitation, that the Resolution remains in full force and effect). 4. None of: (a) the authorization, execution, and delivery of the Agreements; or (b) the payment or performance by CRC of its obligations under the Agreements; violates any judgment, order, agreement, or other instrument to which CRC is subject. 5. The Resolution validly authorizes: (a) the execution and delivery of the Agreements; and (b) the payment or performance by CRC of its obligations under the Agreements. The Agreements: (a) have been validly executed and delivered by CRC; and (b) are valid and binding obligations of CRC that, to the full extent permitted by Indiana law, are enforceable against CRC in accordance with their terms. 6. No litigation of any nature currently is pending or threatened against CRC that seeks to enjoin or challenge: (a) the authorization, execution, and delivery of the Agreements; (b) the payment or performance by CRC of its obligations under the Agreements; (c) any Z: \ Documents \Shoup. Jenny \City of Canncl \Parcel 71Theater \Base 02Feb 10 Structure- Regions Loan\Opinions\CRC\Opinion Lcuer.wpd -2- • 0 0 proceedings or actions had, taken, or approved by CRC with regard to the foregoing; or (d) the validity of the Agreements or the Resolution. 7. To the best of our knowledge, the statements contained in the Certificates are correct. D. Assumptions. For purposes of this opinion, we have assumed (without independent verification or investigation) or are otherwise relying upon the following: 1. Lender: (a) is organized and existing under the laws of the State of Indiana; (b) is authorized to conduct business in the State of Indiana; (c) is qualified to engage in the transactions contemplated by the Agreements and the Developer Loan Documents (as defined in the MLPA); and (d) has the requisite power and authority to perform its obligations under the Agreements and all other Developer Loan Documents. 2. The: (a) execution and delivery of the Agreements and all other Developer Loan Documents to be executed by Lender; and (b) performance by Lender of all obligations under the Agreements and all other Developer Loan Documents to be executed by Lender; have been authorized on behalf of Lender. 3. The Agreements and all other Developer Loan Documents to be executed by Lender: (a) have been validly executed and delivered by Lender; and (b) constitute valid and binding obligations of Lender that are enforceable against Lender in accordance with their terms. 4. The execution and delivery of the Agreements and all other Developer Loan Documents executed by Lender were free of intentional or unintentional mistake, undue influence, duress, fraud, illegality, or criminal activity. 5. Neither Lender nor Lender's attorney has any current actual knowledge of any reason why any portion of this opinion letter is not accurate. E. Qualifications. The opinions expressed herein are qualified in their entirety as follows: 1. We are members of the Bar of the State of Indiana, and our opinion relates only to: (a) the laws of the State of Indiana; and (b) the federal laws of the United States of America; that currently are in effect and, in our experience, normally are applicable to CRC and the transactions in which it engages (the "Applicable Laws "). We express no opinion with respect to any laws other than the Applicable Laws. Accordingly, we express no opinion as to: (a) compliance with applicable foreign laws; or (b) federal or state securities, anti - fraud, anti- trust, restraint of trade, or tax statutes, or the rules and regulations promulgated thereunder. 2. Whenever in our opinion the existence or absence of facts is indicated to be based on our knowledge, this shall mean that: (a) during the course of our representation of CRC, no information has come to our attention that would give us current actual knowledge of the Z:\Doc uments\Shoup, Jenny \City of CanncI\Parcel 7 \Theater \13ase 02 Feb t 0 Structure- Regions Loan \Opinions \CRC \Opinion Letter.wpd -3- 0 existence or absence of such facts; and (b) we have not undertaken any independent investigation to determine the existence or absence of such facts; and no inference as to our knowledge of the existence or absence of such facts otherwise should be drawn from our representation of CRC. 3. The enforceability of the Agreements may be limited by: (a) the rights of the United States of America under federal laws to which the laws of the State of Indiana are subordinate; (b) bankruptcy, insolvency, preference, reorganization, moratorium, liquidation, and other laws relating to, or affecting, the rights or remedies of creditors and /or relief of debtors, including, without limitation, fraudulent transfer laws; and (c) general principles of equity, that may be considered in a proceeding at law or in equity, including, without limitation, concepts of materiality, marshaling, reasonableness, good faith, and fair dealing, and other doctrines affecting the enforceability of governmental agreements generally. 4. The: (a) enforceability of the remedies provided by the Agreements; and (b) the availability of equitable remedies; may be limited where a court of competent jurisdiction finds that such remedies were at the time made, or are in application, unconscionable as a matter of law or contrary to public policy. The enforcement of specific rights under the Agreements may require: (a) a judgment or decree of a court of competent jurisdiction after prior notice to CRC; and (b) an opportunity for CRC to be heard by an appropriate tribunal. Enforcement of rights and remedies may be conditioned upon the conduct of Lender conforming with any applicable implied covenant of good faith and fair dealing, notwithstanding any language in the Agreements reserving to Lender, either specifically or in effect, the right to take certain specified actions in its sole or absolute discretion. 5. We express no opinion as to the enforceability of any provision of the Agreements that obligates CRC to pay a late charge on overdue payments or an early termination settlement. To our knowledge, there is no statute in Indiana that either authorizes or prohibits the collection of a late payment charge or an early termination settlement. Although a late payment charge or an early termination settlement may constitute consideration paid in exchange for waiver of the right to refuse a late payment or an early termination, late payment charges and early termination settlement may be subject to challenge as unenforceable penalties. We also express no opinion as to: (a) the enforceability of any provision of any Developer Loan Document other than the Agreements; or (b) the availability of any of the remedies under any of the Developer Loan Documents other than the Agreements. We further advise you that certain waivers or releases of rights may be unenforceable or of limited efficacy. Notwithstanding the qualifications set forth in this paragraph, the provisions described in this paragraph will not affect the overall validity of the Agreements or, subject to the other qualifications set forth above, render the Agreements inadequate for the practical realization by Lender of the principal benefits intended to be provided to Lender thereunder. This letter is limited to the specific issues addressed herein, and the opinions rendered herein are limited in all respects to laws and facts existing on the date hereof. No opinion is expressed with respect to any changes that may occur in such laws and facts after the date of this letter. By rendering this opinion, Z:\ Docutnents \Shoup, Jenny \City of Cannel\Parcel 7 \Theater\Base 02Feb 10 Structure - Regions Loan\Opinions\CRC\Opinion Letter.wpd -4- e we do not undertake to advise you with respect to: (a) any other matter; (b) any change in such laws or facts; or (c) any change in the interpretations of such laws; that may occur after the date hereof. This letter: (a) is furnished to you for your benefit may be relied upon by you and your successors, assigns, and participants in connection with making the Loan to Borrower as part of the Loan Program; and (b) is not to be used, circulated, quoted in whole or in part, referred to (except in a list of closing documents), or otherwise relied upon, nor is it to be filed with any governmental agency or other person, without our prior written consent in each instance. � Very truly yours, I V4LyikX jig-15 a )441 r . Wallack Somers & Haas, PC ZADocuments\Shoup. Jenny \City of Carmcl\Parcel 71Thcater\l3ase 02 Feb 10 Structure - Regions Loan \Opinions \CRC \Opinion Letter.wpd -5-