Replacement Payment Agreement - Anderson Birkla REPLACEMENT PAYMENT AGREEMENT
This Replacement Payment Agreement (the "Agreement"), executed this Z9 day of
,2013,by and between Carmel Development I, LLC (the"Developer"),the City of Carme Utilities
Department(the'Utility Provider"),and The City of Carmel Redevelopment Commission ("CRC"),Witnesses:
Recitals
WHEREAS, Developer and 4CDC executed the Project Agreement;
WHEREAS,pursuant to the Project Agreement, Developer: (a)has acquired the Monon Site
and the Third Avenue Site; and (b) is obligated to construct the Developer Buildings;
WHEREAS, at the Closing, and consistent with the terms and conditions of the Project
Agreement, Developer and Utility Provider executed the H&C Water Units Agreement, pursuant to which
Developer committed to purchase the H&C Water Units at the H&C Water Units Price for a period of at least
three years;
WHEREAS, subsequent to the execution of the H&C Water Units Agreement, it was
determined that the cost to "hook into"the Energy Center such that the H&C Water Units could be obtained
far exceeded the expectations of the parties;
WHEREAS,the parties have agreed that, rather than incur such costs Developer shall obtain
heated and chilled water to serve the Commercial Space from a source other than the Energy Center;
WHEREAS, as a result of such agreement, the parties seek to terminate the H&C Water
Units Agreement;
WHEREAS, because the obligation of Developer to purchase the H&C Water Units at the
H&C Water Units Price for a period of three years was included in the determination of the amount that
Developer is contributing to the Project, Developer and CRC have agreed that,subject to and in accordance
with the terms and conditions of this Agreement, Developer shall make the Replacement Payments; and
WHEREAS, Developer, Utility Provider, and CRC wish to execute this Agreement; provided
that Utility Provider is executing this Agreement for the sole purpose of agreeing to the terms and conditions
of Section 2;
Agreement
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are acknowledged hereby, the parties agree as follows:
1. Definitions.
4CDC shall mean the Carmel City Center Community Development Corporation.
City shall mean the City of Carmel, Indiana.
Closing shall mean the closing with respect to the acquisition of the Monon Site and the Third Avenue Site.
Commercial Space shall mean the ground floor of the Third Avenue Building, which ground floor shall be
comprised of approximately 8,500 square feet of commercial office space.
Developer Building shall mean the Monon Site Building and/or the Third Avenue Building, as applicable.
Energy Center shall mean the structure located on the Energy Center Site and commonly known as the
"Energy Center".
Energy Center Site shall mean that portion of Parcel 7c that is delineated on the Site Plan as the "Energy
Center Site".
Event of Default shall have the meaning set forth in Subsection 5(a).
H&C Water shall mean heated and chilled water processed for, distributed to, and received from certain
nearby buildings by the Energy Center.
H&C Water Units shall mean H&C Water in such quantities as are needed to serve all of the needs of the
Commercial Space with respect to the processing, distributing, and receipt of heated and chilled water.
H&C Water Units Agreement shall mean thatcertain H&C Water Units Agreementexecuted by and between
Developer and Utility Provider and dated February 5, 2013.
H&C Water Units Price shall mean a rate with respect to use of the H&C Water Units that is the lesser
of the lowest rates: (a) charged to other users of heated and chilled water from the Energy Center; or
(b) available in the City from other public, semi-public, or private providers of heated and chilled water to
the general public.
Monon Site shall mean that portion of Parcel 7c that is delineated on the Site Plan as the "Monon Site".
Monon Site Building shall mean a building comprised of five stories that incorporates approximately:
(a)4,900 square feet of commercial and residential space on the ground floor; and (b)20-24 residential units
on the upper floors. The Monon Site Building comprises the majority of the project to be constructed on the
Monon Site by Developer pursuant to the Project Agreement.
Parcel 7c shall mean that certain real estate commonly known as "Parcel 7c", which real estate is
delineated as "Parcel 7c" on the Site Plan.
Project Agreement shall mean that certain Project Agreement by and between Developer and 4CDC dated
May, 2012, as amended by that certain: (a) First Amendment to Project Agreement dated August 21, 2012;
(b) Second Amendment to Project Agreement dated as of September 28, 2012; (c) Third Amendment to
Project Agreement dated as of November 15, 2012; and (d) Fourth Amendment to Project Agreement dated
as of December 17, 2012.
Replacement Payments shall mean payments that, in the aggregate,total the amount that Developer would
have paid during the Term under the H&C Water Units Agreement in connection with purchasing the H&C
Water Units for the H&C Water Units Price.
Site Plan shall mean the site plan attached hereto as Exhibit A.
Substantial Completion Date shall mean the date on which the "Project" (which is comprised primarily
of the Developer Buildings) is substantially completed pursuant to the Project Agreement.
Term shall mean the term of this Agreement, as set forth in Section 3.
Third Avenue Building shall mean a building comprised of five stories that incorporates: (a) the
Commercial Space: and (b) approximately 20 residential units on the upper floors. The Third Avenue
Building comprises the majority of the project to be constructed on the Third Avenue Site by Developer
pursuant to the Project Agreement.
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Third Avenue Site shall mean that portion of Parcel 7c adjacent to the right-of-way of Third Avenue S.W.that
is delineated on the Site Plan as the "Third Avenue Site".
2. H&C Water Units Agreement. Developer and Utility Provider agree that, effective as of the date
hereof, the H&C Water Units Agreement is terminated, and is of no further force or effect.
Contemporaneously with the execution of this Agreement, Developer and Utility Provider shall execute an
instrument reflecting the termination of the H&C Water Units Agreement, which instrument shall:
(a) cross-reference that certain Memorandum of H&C Water Units Agreement dated February 5, 2013,
and recorded in the Office of the Hamilton County Recorder; and (b) be recorded in the Office of the
Hamilton County Recorder.
3. Term. The "Term" shall: (a) commence on the date hereof; and (b) expire on the third anniversary
of the Substantial Completion Date.
4. Payments.
(a) Amount. The parties have agreed that the amount that Developer would have paid
under the H&C Water Units Agreement in connection with purchasing the H&C Water Units
for the H&C Water Units Price is $537.68 per month, determined by multiplying an assumed
square footage of 7,928 by a monthly rate of$0.06782(reflecting an annual rate of$0.81 per
square foot). Accordingly,during the Term,the Replacement Payments shall be$537.68 per
month.
(b) Payments. During the Term, Developer shall pay to CRC the Replacement
Payments. At the election of CRC, the Replacement Payments shall be payable: (i) either
on a monthly or semi-annual basis; and (ii) in either case within 15 days after receipt by
Developer of a written invoice from CRC, together with such supporting evidence as
reasonably may be necessary to establish that the invoice sets forth an amount that is
consistent with the amount that Developer would have paid for the same period pursuant to
the H&C Water Units Agreement;provided that Developer,at any time, may prepay all or any
portion of the Replacement Payments without penalty.
5. Delinquency.
(a) Default. It shall be an"Event of Default"hereunder If:(i)Developer fails to timely pay
any Replacement Payment; and (ii) such failure continues for a period of ten days after
receipt of written notice; provided that, after the second such failure in any given calendar
year during the Term, no notice shall be required to be given, and no grace period shall
apply, in connection with a subsequent failure, and any subsequent failure in such calendar
year shall constitute an immediate Event of Default.
(b) Remedies. During the continuance of an Event of Default, CRC may elect to:
(i) terminate this Agreement; and/or (ii) take such actions as CRC deems to be necessary
or appropriate to recover all amounts outstanding hereunder. If CRC elects to terminate this
Agreement, then CRC may accelerate payment of the total amount of the Replacement
Payments that, in the absence of such termination, would be payable by Developer during
the period commencing on the date of the termination and ending on the third anniversary
of the Substantial Completion Date. In the event of any acceleration as permitted pursuant
to this Section, Developer shall pay all accelerated amounts within 30 days after receipt of
written invoice from CRC, together with such supporting evidence as reasonably may be
necessary to establish that the invoice sets forth an amount that is consistent with the
amount that Developer would have paid for the same period pursuant to the H&C Water
Units Agreement.
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(c) Reimbursement. If CRC incurs any costs or expenses in connection with the proper
exercise of its rights and remedies under,or the proper enforcement of,this Agreement,then
Developershall reimburse CRC for all such costs and expenses(including,without limitation,
attorneys' fees and other legal costs), together with interest at the rate of 12% per annum.
6. Assignment. Neither Developer nor CRC shall assign this Agreement without the prior approval
of the other party, which consent may be withheld in such party's sole discretion; provided that, without
the consent of the other party: (a) Developer, in connection with a sale of the Commercial Space, may
assign this Agreement to the purchaser of the Commercial Space; and (b) CRC may assign this
Agreement to another department, agency, or instrumentality of the City. In no event shall an assignment
of this Agreement by Developer of this Agreement relieve Developer of liability for its obligations hereunder,
unless CRC, in the exercise of its sole discretion,specifically agrees in writing to release Developer from such
liability.
7. Notice. All notices and invoices permitted or required to be delivered pursuant to this Agreement
shall be in writing, and deemed to have been delivered when: (a) delivered in person or by; or (b) sent by
nationally recognized overnight carrier; in any case addressed as follows: to Developer at 301 Pennsylvania
Parkway, Suite 301, Indianapolis, Indiana 46280, with a copy to Jeffrey A. Abrams, Benesch, Friedlander,
Coplan & Aronoff LLP, One American Square, Suite 2300, Indianapolis, Indiana 46282; and to CRC at
30 West Main Street, Suite 220, Carmel, Indiana 46032, with a copy to Jennifer R. Shoup, Esq., Wallack
Somers & Haas, PC, One Indiana Square,Suite 2300, Indianapolis, Indiana 46204. Either party may change
its address for notice by written notice delivered to the other party as provided in this Section,
6. Miscellaneous. Subject to Section 6: (a) Section 2 of this Agreement shall inure to the benefit of,
and be binding upon, Utility Provider and its successors and assigns; and (b) this Agreement shall inure to
the benefit of, and be binding upon, Developer, CRC, and their respective successors and assigns. The
invalidity, illegality,or unenforceability of any one or more of the terms and conditions of this Agreement shall
not affect the validity,legality,or enforceability of the remaining terms and conditions hereof. This Agreement
shall be governed by, and construed in accordance with, the laws of the State of Indiana. All proceedings
arising in connection with this Agreement shall be tried and litigated only in the state courts in Hamilton
County, Indiana, or the federal courts with venue that includes Hamilton County, Indiana. Developer waives,
to the extent permitted under applicable law: (a) the right to a trial by jury; and (b) any right Developer may
have to: (i) assert the doctrine of "forum non conveniens"; or (H) object to venue. This Agreement may be
executed in counterparts, each of which shall be an original, but all of which taken together shall constitute
a single instrument. All Exhibits to this Agreement are attached hereto and incorporated herein by reference.
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IN WITNESS WHEREOF, Developer, Utility Provider, and CRC have executed this
Agreement as of the date set forth above.
CARMEL DEVELOPMEN , C
By:_ _/-
AntholriTBirkla, Me per
CITY OF CARMEL UTILITIES
DEPARTMENT
By: The City of Carmel Redevelopment
Commission, Energy ter Owner
BY`\ �
Les Olds, Executive Director
THE [ CITY OF CARMEL
REDE ELOPMENTC• ISSION
By: /' .4
William Hammer, Pr:si;rent
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EXHIBIT A
Site Plan
Depiction of Parcel 7c, Energy Center Site, Monon Site, Third Avenue Site
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