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HomeMy WebLinkAboutRes 22-79 07/17/1979 7/17/79 Resolution No. 22-79 RESOLUTION AUTHORIZING EXECUTION OF MEMORANDUM OF AGREEMENT WITH MAISEL \" WHEREAS, '\ 1, J~y 17 (~ \^ the Village of Mount Prospect has heretofore, on , 1979, in the exercise of its authority as a home r~le unit under Section 6 of Article VII of the Con- stitution of the State of Illinois of 1970, adopted Ordinance No. 2925 'adding a new Section 8.513 to Article V of Chapter 8 of the Municipal Code of the Village of Mount Prospect authori - I I ing the issuance of industrial and ccmnercial developnent project reverfE I bonds to, among other things, finance in whole or in part the I I I cost of constructing and equipping of a commercial building I (collectively called the "Project") to be used as a K-Mart Store within the corporate limits of the Village of Mount Prospect; and I I I general partnership (the "partnershiptl), h8.S determined to locat$ the Project within the corporate limits of the Village of Mount I I I j I I , issue corrmercial developnent revenue b::mds to finan,* I I i I j I - I . i WHEREAS, by reason of the matters hereinabove set forti the President and Board of Trustees of the Village of Mount I ! Prospect have found and detennined that the issuance of conrnercial aevelr ment revenue ronds of the Village pursuant to the said Ordinance I 2925 would be for a public purpose and in connection with a I that pertains to the government and affairs of the Villag1 Mount Prospect; and WHEREAS, Maisel & Associates of Michigan, a Michigan Prospect and has requested that the Village of Mount Prospect, in the exercise of the authority conferred by the said Ordinance No. 2925 the cost of the construction and equipping of a commercial building to be used as a K-Mart Store; and I I I 7/17/79 ($2,100,000.00) of its Commercial Development Revenue Bonds upon the general terms and conditions set out in the said Agreement for the purpose of defreying the cost of the constructing and equipping of said Project. SECTION FOUR: This resolution shall be in full force effect after its passage and approval in the manner provided law and the effective date of Ordinance No. 2925 PASSED THIS 17th July , 1979. DAY OF AYES: 5 NAYS: 1 ABSENT: 0 APPROVED THIS 17th DAY OF July I 1979. v('f1hl{/i~ T: (j /}jJI ' . ! 1-4.ftr I.-y'"', ~tTdn~' Village Clerk -3- \ I, II. I" Ii I I I II II I}O the Village of Mount Prospect and the Village of Mount Prospec ~as reviewed and revised a Memorandum of Agreement in connection 11 IF th the proposed issuance of the corrmercial developnent revenue ronds ~'jmaer which the Village =uJ.d agree, subject to the provisions of such greement, to issue its revenue ronds to provide the funds far the construc- i ,I Ipen of such Project, a copy of which revised Agreement is attached hereto I ts Exhibit A and made a p:rrt hereof by this reference; and J ' ,i II II Willage of Mount Prospect have found and determined that Ii ~xecution of the Agreement would be in the best interests of the If Willage and desire to authorize the proper officers of the II Willage ~o execute the same; jl ~ NOW, THEREFORE, BE IT RESOLVED BY THE President and '!oard of Trustees of the Village of Mount Prospect, Cook I ~ounty, Illinois, as follows: 1; ili:. l WHEREAS, Maisel & Associates of Michigan has presented WHEREAS, the President and Board of Trustees of the SECTION ONE: the President and Board of Trustees MEMORANDUM OF AGREEMENT THIS MEMORANDUM OF AGREErmNT, made and entered into this day of , 1979, by and between the Village of r10unt Prospect, a municipality in Cook County, Illinois (the "Issuer"), and Maisel & Associates of Michigan, a Michigan general partnership (the "Partnership"); WIT N E SSE T H: WHEREAS the Issuer is authorized under its home rule powers as set forth in the 1970 Constitution of the State of Illinois, Article VII, Section 6, and the provisions of Ordinance No. 2925 passed by the Board of Trustees of the Issuer on July 17 ,1979, as from time to time supplemented and amend- ed (the "Ordinance"); to construct, acquire by gift or purchase, reconstruct, improve, equip, better or extend any commercial develop- ment project, and to acquire by gift or purchase lands or rights in land in connection therewith in order to relieve conditions of unemployment, and to encourage the economic development of the municipality and to provide for the increased welfare and pros- perity of the residents of the municipality, thereby reducing the evils attendant upon unemployment; and -VlliEREAS the Issuer is willing to issue its ccmnercial development revenue bonds under and pursuant to the provisions of the Ordinance and to make the bond proceeds available to the Partnership for payment of part of the cost of constructing and equipping a commercial building (said building and equipment collectively called the "Project"), to be located on a site within the coX'p)rate limits of the Issuer, in the shopping center ccrcmonly known as Mount Propsect Plaza, which site (referred to herein as "the Project site") is leased by the Exhibit A ._..,_..__.___,_._________".,.~=,=~~"~'''''''''.."''''''.,,.~;.~~;.;""'~~,~"'""''''"=====,=_'''''''':r='=P''"~";''''''''''',..,"'''.''',~''=.::.=''',_'''''"_.,_'~._._...~"''"'''.,.,.J<_.__,'''''''''''''.''''''='''''''''''''''''''~'''''''-'''''~=_,...,,.,=~"=l'l''''='~='m~. - 2 - Partnership from Cermak Plaza, Inc., an Illinois corpora- tion (IICermakll), pursuant to a loan agreement to be entered into between the Issuer and the Partnership and subject to the conditions set forth below; and WHEREAS the Partnership desires to locate the Project within the territorial limits of the Issuer and to lease the Project to K Mart Corporation, a Michigan corporation (ilK Mart") : NOW, THEREFORE, in consideration of the premises and of the mutual undertakings herein expressed, the parties hereto recognize and agree as follows: A. The Issuer represents and agrees: 1. That the Issuer will, subject in all respects to the provisions and requirements of the Ordinance and all applicable laws and to a sale of the bonds on terms satisfactory to the Issuer in its sole judgment reasonably exercised, authorize, issue, sell and deliver its ~cial development revenue bonds in an approximate principal amount of $2,100,000 and apply the proceeds therefrom to the payment of the costs of the Project, provided that prior to the issuance and delivery of such oommercial development revenue bonds: Ca) there shall have been entered into between the Issuer and the Partnership a loan agreement which will comply with the provisions of the Ordi- nance and which will provide for loan repayments by the Partnership sufficient to enable the Issuer to pay the principal of and interest on such ccmnercial development revenue bonds and which may ~~""'_,'"~",'~',o-,,,,,,,,,,,,,,",~,,,,,,,,,,="~""".'.',,,,,,,,,,,.~''''"="'~==''''''''''''''_~=''''_'''='''''''''''"''''''''''"'~''''='''''''''''~~:''''~''''''''''''':;'''!\'l'1.=:::-,"",",'''''~''''''''"",::-""'.~-P'7"~."'-T~""'-,~====>",=~,- _____.~.__'.~......,_~r....,..".",.,_=".:~~"" ~.~ /.--"'"n - 3 - restrict the class of persons to whom such bonds may be offered and which shall include a covenant by the Partnership not to assign its interests in the Project so long as con- struction and equipping of the Project remains uncompleted and thereafter until such time as all construction warranties by the Partnership have expired; provided, however that this -- prohibition on assignment shall not extend to any assignments of the partnership's interests to a Trustee for the bondholders of any economic development revenue bonds issued for the project; and, (b) there shall have been entered into be- tween the Partnership and K Mart a lease under terms and conditions satisfactory to the Issuer and its counsel, including but not limited to the obligation of K Mart, as lessee, to pay rent at least sufficient to pay principal and interest on the anmercial development revenue bonds so long as they shall be outstanding; and (c) Cermak and all other holders or owners of interests in the project site shall have entered into such agreements satisfactory to the Issuer and its counsel, as shall assure the holders of the canmercial :level.:)pment revenue bonds a first lien on the Project and the Project site so long as the ronds shall be outstanding which IPay include, without limiting the foregoing, sub::Jrdination of the fee, of any security interests therein and of any leases thereof and, in addition, such non- disturbance and attoDlIDent agreements respecting such leases as Issuer may require; and ~_~_",_.=._""";,~,=,.=""""-,,,,..,,,,,,,....,,,m,,,,,.,,,,,,,,,,,,,,,""=='~'.""'~',o~''''.n="."""""""""'J"""",=,_,~~=r~~""","",,,,~~'l'11=~"'~~----~"-~"'~~="OJ='""""""="'~=~"';,--=~,==""".=-,.~,. /~ ,~~'" - 4 - (d) the Ground Lease and such other con- tracts, agreements and evidences of indebtedness as the Partnership shall have entered into shall be acceptable to the Issuer and its counsel; and (e) the partnership shall have paid any and all costs, fees and expenses charged or incurred by the Issuer and its counsel in connection with the Project and a fee for the review and processing of the partnership's request for issuance of said bonds. Costs and expenses shall include, but not be limited to, attorney's fees, fees of financial consultants, charges for administrative time of the Issuer, fees of any and all other consultants and any and all other costs and expenses of the Village incurred in connection with the Project. Reimburse- ment for any attorney's fees incurred by the Issuer shall be at the normal hourly rate of the Issuer's counsel. The fee for reviewing and processing the Partnership request shall be $25,000.00, of which $5,000 shall be paid by the partnership upon execution of this Memorandum of Agreement with the balance of the issuance fee to be paid on the date the partnership receives the proceeds from the sale of the bonds. costs, fees and expenses of the Issuer and its counsel shall be paid within ten (10) da7s of. the ~eceipt of a bill ,___~.~_"",~,~","""""".'"".""",,,.',,,...,,,.,,,,,,,,.,,,,,,,.=.:>~,,",,,,,~~<'_""'"C"c~.-.~~._.",.":p,.-."".y,.==~~"",.'_,~;~~"""",.,,,"'=:;"""==.~"'1'7."'~'''''_~';!8"S::-W':'',",:;tl..-."~~~.===.,="""",~.,~.=,,,,",,,,~'''''~''''~'"~-'~'___""~_-'-""""""--~,,",,~m""':"'"=''''>''''''<''_''''''''''.''''"''''_-'''"''''''''~""""~",,. /"'..,~, .r.-=.''''....... - 5 - therefor from the Issuer. In the event comnercial development revenue bonds are not issued for the project, the $5,000 to be paid by the partnership upon the execution of this Memorandum of Agree- ment shall be applied against the costs, fees and expenses of the Issuer and its counsel; and (f)- all documentation relating to issuance and sale of the bonds, including the forms of opinions to be rendered with respect to validity, exemption of interest on the bonds from Federal income taxation and compliance with Federal and state securities laws, shall have been submitted to the Issuer and approved by Issuer and its counsel as to form and content, but no such approval shall be deemed to be a representation to any party as to the validity of the bonds or any document relating thereto. B. The Partnership represents and agrees: 1. That the Project will result in increased employment and will increase economic development within the municipality. 2. That if the proposed commercial development revenue bonds (including the rate of interest thereon) of the Issuer are satisfactory to the Partnership, it will enter into a loan agreement with the Issuer upon terms which will be sufficient to enable the Partnership to pay the cost of the Project as evidenced by such ~cial development revenue bonds to be issued for the account ~,~'~~__~_~"""""''''7.~''"'~."..,r''''=',-,;::~=='':''--='=,"~~=.>=""",,'''''''~'---~-~-''''''''".m.'<"":~'",,=~__"""","__'",,~~~~'I:""""':<'<Im.=~~Jf'0~ ,..--"",....,-"..." r-<~"'>, - 6 - of the Project, and will enter into appropriate contracts with the Issuer with regard to the foregoing and into a lease with K Mart for the term and at the rentals prescribed in Section A l(b) hereof, prior to the issuance and delivery of any such ccmnercial development revenue bonds by the Issuer. 3. That the statement of assets and liabilities attached hereto as Exhibit A, truly and accurately reflects the financial condition of E. N. Maisel & Associate as of the date thereof and that the consolidated financial position of E. N. Maisel & Associates and Maisel & Associates of Michigan has not been adversely affected since the date of that statement. Ivr aisel and Associates shall submit an acceptable financial statement for 1978 to the Village no later than September 1, 1979. C. It is further recognized and agreed between the Issuer and the Partnership as follows: 1. Tha t the canmercial development revenue bonds to be issued by the Issuer shall never constitute an indebt~ edness of the Issuer or a loan of credit thereof within the meaning of any constitutional or statutory provision, and such fact shall be plainly stated on the face of each of said bonds. No holder of any of said bonds shall ever have the right to compel any exercise of the taxing power of the Issuer to pay said bonds or the interest thereon. The principal of, premium, if any, and interest on such ~cial development revenue bonds to be issued to finance the cost of the Project shall be secured by the payments to be made under the loan agreement, by a first rrortgage on the Project and the Project site and shall be additior -~-_.._"._-"~~-----,--_._." ~'--'~'-~~"'-~'_'-"""""""".""',--=..",.,."".==",.,.".=~=,,,,~=~-"- - 7 - ally secured by a pledge of the aforesaid lease between the Partnership and K Mart. 2. That, if for any reason the aforesaid bonds are not issued, the Issuer shall in no way be liable in damages or otherwise, to any party for such failure of consummation of the financing and no remedy whether legal or equitable shall be instituted hereunder or under any other agreement relating hereto. 3. That this agreement shall inure to the benefit of the Issuer and the Partnership and their respective successors and assigns provided, however, that this Agreement may not be assigned or otherwise transferred by the Partnership. 4. That this agreement may be executed in separate counterparts, all of which shall be deemed a single instrument. 5. If satisfactory documents as required hereinabove are not provided to the Issuer and bonds have not been issued within ten months of the date of this Memorandum of Agreement, this Memorandum of Agreement shall be of no further force and effect and the rights and obli- gations of the parties herein shall cease. IN WITNESS WHEREOF, the Issuer, acting by and through its Board of Trustees, has caused its corporate name to be here- unto subscribed by its duly authorized President and attested under its official seal by its Village Clerk, and Maisel & Associates of Michigan has caused its name to be hereunto _,"_~_.~..."._.,....,"~"._,.,.v___"..._".=,_~",,,,___,~....._~'~>~~:""~_'''"'.~''''''_'7::~'''''''''''''''''''''''''''-===-"'''''''_''"~'"='~,,"~,''''''.W';I;''''''''''''''''''"'-------.-~'''''.~-''''''''''''''''.."''''=.,,,.,,~=''''';c;:.~='''''=''''''^~.==_<><=~~=....~."..," ,<."""",,~ /"""'~, - 8 - subscribed by its duly authorized General Partner, all being done as of the year and date first above written. VILLAGE OF MOUNT PROSPECT, ILLINOIS By pre~ /I ~... ~ (S EAL) Attest: Village Clerk MAISEL & ASSOCIATES OF MICHIGAN By General Partner ".,- ~"""'''', DORF:\IAN, r-,.IoRoF, SHEPLOW, SHARFMAN. WEINSTEIN & CO:'lPANY CERTI'It:O PU8LIC ACCOUNTANTS E. N. MAISEL & ASSOCIATES STATEMENT OF ASSETS AND LIABILITIES AS AT DECEMBER 31, 1977 ASSETS Current Assets Cash in banks Savings bonds Accounts receivable Jobs under construction and Development - Net book equity Total Current Assets $ 2,281,833 51,000 2,122,659 3,296,614 Investments Income producing real estate Less: Mortgage balances Net market value - Income producing Vacant land Other investments Total Investments $122,126,091 100,987,891 $21,138,200 3,523,700 159,874 real estate TOTAL ASSETS LIABILITIES AND CAPITAL Current Liabilities Accounts payable Notes payable - Banks Not~s payable - Partner Total Current Liabilities $ 930,084 1,200,000 l3Ls.,649 Other Liabilities Tenant security deposits Intercompany account - Malan Construction Company Total Other Liabilities $ 13,967 390,261 Total Liabilities Capital Net worth (Including completed and vacant properties at market value) TOTAL LIABILITIES k~D CAPITAL Exhibit A $ 7,752,10 24,821,77 $32.573.88 $ 2,264,7: 409, 2~ $ 2,673,9€ 29,899,9] $32,573,81 THIS STATEMENT HAS BEE:N PREFAREO PRIMAi'll!..'" FOR MANAGE:MENT PURPOSES AND CERTAIN AUDITING PROCE:DURES RE:QUIRE:D FOR THE: EXPRESSION OF AN OPINION HAVE NOT BEE:N PE:RFORMEO AS OF' THIS DATE _____'._.__'.~___,_,_.._"_~.~~~...___."'.,..,~_~,,..,""~~.__.~~.,.,-=""""=-_,=~"'_",,,,,"","'=""""''''''''''''~~~''''''''''''==W-,~'?i'Yt)!I;)15ff''J:..''''~'__~~____.-,-.'~w~~.~_"'_,__._____