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HomeMy WebLinkAbout13-150 Resolution No. 13-150 RESOLUTION AUTHORIZING EXECUTION OF A LOAN AGREEMENT WITH THE ELGIN SYMPHONY ORCHESTRA ASSOCIATION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS, that David J. Kaptain, Mayor, and Kimberly A. Dewis, City Clerk, be and are hereby authorized to enter into a loan agreement with the Elgin Symphony Orchestra Association providing for an installment loan to the Elgin Symphony Orchestra Association, a copy of which is attached hereto and made a part hereof by reference. s/David J. Kaptain David J. Kaptain, Mayor Presented: September 11, 2013 Adopted: September 11, 2013 Vote: Yeas: 6 Nays: 3 Attest: s/Kimberly Dewis Kimberly Dewis, City Clerk LOAN AGREEMENT THIS LOAN AGREEMENT is made and entered into this 11th day of September, 2013, by and between the City of Elgin, Illinois, a municipal corporation, organized and existing under the laws of the State of Illinois (hereinafter referred to as the "City ") and the Elgin Symphony Orchestra Association, an Illinois not - for - profit corporation (hereinafter referred to as the "ESO "). WITNESSETH: WHEREAS, as a result of previous rentals by the ESO of the City's Hemmens Cultural Center, there is due and owing from the ESO to the City the sum of Two Hundred Thirty -Three Thousand Nine Hundred Thirty and 21/100 Dollars ($233,930.21); and WHEREAS, ESO has requested and the City has agreed to allow ESO to repay to the City such monies plus interest in installments pursuant to the terms and conditions of this agreement. NOW, THEREFORE, for and in consideration of the mutual undertakings contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: Incorporation of Recitals. The foregoing recitals are incorporated into this agreement 2. ESO'S Acknowledgement of Debt to City. ESO hereby acknowledges and agrees that it is indebted to and owes the City the amount of Two Hundred Thirty -Three Thousand Nine Hundred Thirty and 21/100 Dollars ($233,930.21); (such $233,930.21 owed by the ESO to the City is hereinafter referred to as the "Principal" or the "Subject Loan "). 3. ESO'S Promise to Pay. ESO agrees to and promises to repay to the City in full the Principal amount of Two Hundred Thirty -Three Thousand Nine Hundred Thirty and 21/100 Dollars ($233,930.21) plus interest thereon in installments as provided for in this agreement. ESO will make all payments under this agreement in the form of United States dollars by check. 4. Interest. Interest will be charged on unpaid Principal until the full amount of Principal has been paid. ESO will pay interest at a yearly rate of 2.8333 %. The interest rate that ESO will pay will change in accordance with Section 6 of this agreement. The interest rate required by this Section 4 is the interest rate ESO will pay before any default. The interest rate ESO will pay after any default is described in Section 12 of this agreement. 5. Payments. A. Time and Place of Payments. ESO will pay Principal and interest by making a payment to the City every month. ESO will make monthly payments on the first day of each month beginning on November 1, 2013. ESO will make these payments every month until ESO has paid all of the Principal and interest and any other charges described below that it may owe to the City. Each monthly payment will be applied as of its scheduled due date and will be applied to interest before Principal. If on October 31, 2028, ESO still owes amounts under this loan agreement, ESO will pay those amounts in full on that date, which is called the "Maturity Date ". ESO will make monthly payments to the City of Elgin at 150 Dexter Court, Elgin, Illinois 60120, or at a different place if required by the City. B. Amount of Initial Monthly Payments. Each of ESO'S initial monthly payments will be in the amount of One Thousand Five Hundred and Ninety -Six Dollars and 79/100 ($1,596.79). This amount may change. C. Monthly Payment Changes. Changes in ESO'S monthly payment will reflect changes in the unpaid Principal of the Principal and in the interest rate that ESO must pay. The City will determine ESO's new interest rate and the changed amount of ESO's monthly payment in accordance with Section 6 of this agreement. 6. Interest Rate and Monthly Payment Changes. A. Change Dates. The interest rate ESO will pay may change on the first (P) day of November, 2014, and on that day every twelfth (12th) month thereafter. Each date on which ESO'S interest rate could change is called a "Change Date ". B. Interest Rate. Beginning with the first Change Date, ESO'S interest rate will be based upon the City's then current annual borrowing rate as determined by the City's Chief Financial Officer. Such determination of the City's then current annual borrowing rate by the City's Chief Financial Officer shall be final and conclusive and shall not be subject to challenge or dispute by the ESO. C. Calculation of Changes. Before each Change Date, the City will determine ESO'S new interest rate. The City will then determine the amount of the monthly payment that would be sufficient to repay the unpaid Principal that the ESO is expected to owe at the Change Date in full on the Maturity Date at ESO'S new interest rate in substantially equal payments. The result of this calculation will be the new amount of ESO'S monthly payment. D. Effective Date of Changes. effective on each Change Date. ESO will pay the beginning on the monthly payment due on November monthly payment changes again. -2- ESO'S new interest rate will become amount of ESO'S new monthly payment 1 of each year until the amount of ESO'S E. Notice of Changes. The City will deliver or mail to the ESO a notice of any changes in ESO'S interest rate and the amount of ESO'S monthly payment before the effective date of any change. 7. ESO'S Right to Prepay. ESO has the right to make payments of Principal at any time before they are due. A payment of Principal only is known as a "Prepayment ". When ESO makes a Prepayment, it will tell the City in writing that it is doing so. ESO may not designate a payment as a Prepayment if it has not made all monthly payments due under this agreement. ESO may make a full Prepayment or partial Prepayment without paying a Prepayment charge. The City will use ESO'S Prepayment to reduce the amount of Principal that it owes under this agreement. However, the City may apply ESO'S Prepayment to the accrued and unpaid interest on the Prepayment amount, before applying ESO'S Prepayment to" reduce the outstanding Principal amount. If ESO makes a partial Prepayment, there will be no changes in the due dates of ESO'S monthly payment unless the City agrees in writing to those changes. ESO'S partial Prepayment may reduce the amount of ESO'S monthly payments after the first Change Date following ESO'S partial Prepayment. However, any reduction due to ESO's partial Prepayment may be offset by an interest rate increase. 8. Loan Charges. If a law, which applies to this agreement and which sets maximum loan charges, is finally interpreted so that the interest or other loan charges collected or to be collected in connection with this loan agreement exceed the permitted limits, then: (a) any such loan charge shall be reduced by the amount necessary to reduce the charge to the permitted limit; and (b) any sums already collected from ESO which exceed permitted limits will be refunded to ESO. The City may choose to make this refund by reducing the Principal ESO owes under this agreement or by making a direct payment to ESO. If a refund reduces Principal, the reduction will be treated as a partial Prepayment. ESO'S Failure to Pay as Required. A. Late Charge for Overdue Payments. If the City does not receive the full amount of any monthly payment by the end of five calendar days after the date it is due, ESO will pay a late charge to the City. The amount of the late charge will be 5% of the overdue payment of Principal and interest. The ESO will pay this late charge promptly but only once on each late payment. B. Default. If the ESO does not pay the full amount of each monthly payment on the date it is due, the ESO will be in default. C. Notice of Default. If the ESO is in default, the City may send the ESO a written notice telling the ESO that if it does not pay the overdue amount by a certain date, the City may require the ESO to pay immediately the full amount of Principal which has not been paid and all the interest that ESO owes on that amount. That date must be at least 30 days after the date on which the notices are mailed to ESO or delivered by other means. -3- D. No Waiver By City. Even if, at a time when the ESO is in default, the City does not require the ESO to pay immediately in full as described above, the City will still have the right to do so if the ESO is in default at a later time. E. Payment of the City's Cost and Expenses. If the City has required the ESO to pay immediately in full as described above, the City will have the right to be paid back by the ESO for all its cost and expenses and enforcing this agreement to the extent not prohibited by applicable law. Those expenses include, for example, reasonable attorney's fees. 10. Future Leasing of Hemmens Cultural Center. A. ESO'S Main Performance Venue. In partial consideration of the City's agreement to allow the ESO to pay the monies due to the City in installments, the ESO agrees to continue to lease from the City the City's Hemmens Cultural Center as ESO'S main performance venue for as long as the ESO owes to the City remaining amounts pursuant to this agreement. For the purposes of this agreement the City's Hemmens Cultural Center means the existing Hemmens Cultural Center or such successor facility if such a facility is established and designated by the City. For the purposes of this agreement main performance venue shall deemed to mean that ESO performs not less than seventy -five percent (75 %) of its events in a performance season at the Hemmens Cultural Center in any performance season. For the purposes of this agreement events shall be deemed to mean rehearsals, concerts, performances and other events. B. Lease Terms. The ESO'S leasing of the Hemmens Cultural Center from the City shall be pursuant to written lease agreements with such terms, rights and charges as from time to time determined and established by the City. The ESO agrees to and shall promptly pay when due all rental charges and other fees due to the City pursuant to such lease agreements by the dates as required in such lease agreements. C. Default. If the ESO does not continue to utilize the Hemmens Cultural Center as its main performance venue or does not pay to the City the full amount of the rental charges for future rentals when due, the ESO will be in default. D. Notice of Default. If the ESO is in default, the City may send the ESO a written notice telling the ESO that if it does not cure such default by a certain date, (1) the City may require the ESO to pay immediately the full amount of Principal which has not been paid and all the interest that ESO owes on that amount pursuant to this agreement and, (2) any and all future ESO events at the Hemmens Cultural Center shall be canceled and the ESO'S use of the Hemmens Cultural Center shall be terminated. That date must be at least 30 days after the date on which the notices are mailed to ESO or delivered by other means. E. No Waiver By City. Even if, at a time when the ESO is in default, the City does not require the ESO to pay immediately in full as described above, the City will still have the right to do so if the ESO is in default at a later time. -4- F. Payment of the City's Cost and Expenses. If the City has required the ESO to pay immediately in full as described above, the City will have the right to be paid back by the ESO for all its costs and expenses in enforcing this agreement to the extent not prohibited by applicable law. Those expenses include, for example, reasonable attorney's fees. G. Leasing at City's Discretion. Nothing in this Section or in this agreement is intended or shall be construed as to require the City to lease the Hemmens Cultural Center or any other facility to the ESO. The leasing of the Hemmens Cultural Center or any other facility by the City to the ESO shall be in the sole and exclusive discretion of the City and may be discontinued by the City at any time the City elects to do so. 11. Assignment of Trade Name, Etc. As of the date of this agreement, as security for the repayment of monies by ESO to the City, ESO hereby to the fullest extent permitted by law absolutely and unconditionally assigns to the City all of its right, title and interest, but expressly excluding any obligations, in and to all of ESO'S trade names, trademarks, logos, copyrights, goodwill and books and records relating to or used in connection with the operation of the Elgin Symphony Orchestra Association now existing or hereinafter arising. ESO represents and warrants that it is the absolute owner of such items. free from any and all encumbrances and that it has the power and authority to make such assignment to the City. Notwithstanding the foregoing, so long as no default shall exist and be continuing pursuant to this agreement, ESO shall have the right to continue to use such items in the operation of the Elgin Symphony Orchestra Association. The ESO'S right to continue to use such items may be revoked by the City upon any default by the ESO under the terms of this agreement by giving notice of such revocation to ESO. 12. Default Interest Rate. If the City has required the ESO to pay immediately in full as described in this agreement, then thereafter interest will be charged on the unpaid balance due to the City at the annual rate of 9% until the full amount of the Principal, interest and any other monies due to the City have been repaid to the City in full. 13. Books and Records. ESO will keep and maintain or will cause to be kept and maintained on a fiscal year basis in accordance with generally accepted accounting practices using full accrual accounting proper and accurate books, records and accounts reflecting all of the financial affairs of ESO and all items of income and expense in connection with the operation of ESO. The City shall have the right, at no cost to the City, from time -to -time upon reasonable notice to examine such books, records and accounts at the office of ESO or other person maintaining such books, records and accounts and to make copies and extracts thereof as the City shall desire. At the conclusion of each fiscal year of the ESO the ESO shall provide to the City at no cost to the City a copy of an audited financial statement on all of the financial affairs of the ESO. 14. Giving of Notices. Unless applicable law requires a different method, any notices that must be given to the City under this agreement shall be given by delivering it or by mailing it by first class mail to the City of Elgin at City of Elgin, 150 Dexter Court, Elgin, Illinois 60120, Attention: Chief Financial Officer, with a copy to the Corporation Counsel, City of Elgin, 150 Dexter Court, Elgin, Illinois 60120, or at a different address if ESO is given a notice of that -5- different address by the City. Any notices that must be given to the ESO under this agreement will be given by delivering it or by mailing it by first class mail to Elgin Symphony Orchestra Association, 20 DuPage Court, Elgin, Illinois 60120, Attention: Chief Executive Officer, or at a different address if the City is given a notice of that different address by the ESO. 15. Waivers. ESO and any other entity which has obligations under this agreement waive the right of Presentment and Notice of Dishonor ( "Presentment" means the right to require the City to demand payment of amounts due. "Notice of Dishonor" means the right to require the City to give notice to other persons that amounts due have not been paid). 16. Relationship of the Parties. This agreement shall not be construed so as to create a partnership, joint venture, employment or other agency relationship between the parties hereto. 17. Non - Waiver. The failure of the City to insist upon strict performance of any term of this agreement shall not be deemed to be a waiver of any term of this agreement. 18. Entire Aereement. This agreement constitutes the entire agreement of the parties and the subject matter hereof and may not be changed, modified, discharged or extended except by written amendment duly executed by the parties. Each party agrees that no representations or warranties shall be binding on the other party unless expressed in writing herein or in a duly executed amendment hereof. 19. Applicable Law. This agreement shall be deemed to have been made in and shall be construed in accordance with the laws of the State of Illinois. Venue for the resolution of any disputes or the enforcement of any rights pursuant to this agreement shall be in the Circuit Court of Kane County. 20. Waiver of Trial by Jury. ESO hereby irrevocably and unconditionally waives any and all rights to trial by jury in any action, suit or counter -claim arising in connection with, out of or otherwise relating to this agreement. 21. Joint Work Product. This agreement is and shall be deemed and construed to be a joint and collective work product of the City and ESO, and, as such, this agreement shall not be construed against the other party, as the otherwise purported drafter of same, by any court of competent jurisdiction in order to resolve any inconsistency, ambiguity, vagueness or conflict, if any, of the terms and provisions contained herein. 22. Enforceability. Whenever possible, each provision of this agreement shall be interpreted in such matter as to be effective and valid under applicable law, but if any provision of this agreement shall be unenforceable or prohibited by or invalid under applicable law, such provision shall only be ineffective to the extent of such unenforceability, prohibition or invalidity, without invalidating the remaining provisions of this agreement. 23. Absolute and Unconditional Obli¢ation. The ESO acknowledges that the ESO'S obligation to pay the Principal, interest and any other monies which become due to the City pursuant to this agreement is and shall at all times constitute to be absolute and unconditional in all respects, and shall at all times be valid and enforceable irrespective of any other agreements or circumstances of any nature whatsoever which might otherwise constitute a defense to this agreement or the obligation of the ESO thereunder to pay the monies due pursuant to this agreement. The ESO to the fullest extent permitted by law absolutely, unconditionally and irrevocably waives any and all rights to assert any defense, set -off, counterclaim or cross - claim of any nature whatsoever with respect to the obligation of the ESO to pay the Principal, interest and other monies which may become due in accordance with the provisions of this agreement. 24. Indemnity. Notwithstanding anything to the contrary in this agreement, the ESO shall indemnify and hold the City harmless and defend the City at ESO'S sole cost and expense against any loss or liability, cost or expense (including, without limitation, reasonable attorney's fees and disbursements of the City's counsel, whether in -house staff, retained firms or otherwise), and all claims, actions, procedures and suits arising out of or in connection with this agreement and any and all lawful actions that may be taken by the City in connection with the enforcement of the provisions of this agreement, or in connection with the ESO becoming a party to a voluntary or involuntary bankruptcy, insolvency or similar proceeding. 25. Default. If the ESO violates or breaches any term of this agreement, such violation or breach shall be deemed to constitute a default, and the City shall have the right to seek the administrative, contractual, legal or equitable remedies as specified in this agreement and or as otherwise may be available in law or equity. The rights and remedies of the City pursuant to this agreement whether provided by law or by this agreement shall be cumulative and the exercise by the City of any one or more of such remedies shall not preclude the exercise by it, at the time or different times, of any other remedies for the same default. No waiver made with respect to the performance, nor the manner or time thereof, of any obligation of the ESO of any provision of this agreement shall be considered a waiver of any rights of the City with respect to the particular obligation of the ESO. In the event of any legal proceedings relating to this agreement the ESO shall pay and reimburse to the City all of the City's reasonable attorney's fees. In event and to the extent that any legal work is performed by the City's in -house legal counsel the City shall be reimbursed by ESO for such legal work at the rate of $200.00 per hour, which rate the ESO hereby agrees and acknowledges to be a reasonable rate for such in -house attorney's fees. 26. Binding of Effect. This agreement shall be binding on the parties hereto and their respective successors and permitted assigns. This agreement and the obligations herein may not be assigned by the ESO without the express written consent of the City which consent may be withheld at the sole discretion of the City. 27. Representation on Authority of Parties /Signatories. Each person signing this agreement represents and warrants that he or she is duly authorized and has legal capacity to execute and deliver this agreement. Each party represents and warrants to the other that the execution and delivery of the agreement and the performance of such party's obligations hereunder have been duly authorized and that the agreement is a valid and legal agreement binding on such party and enforceable in accordance with its terms. -7- IN WITNESS WHEREOF, the undersigned have entered into and executed this agreement on the date and year first written above. CITY OF ELGIN ELGIN SYMPHONY ORCHESTRA ASSOCIATION By B7_ David J. Wtain, fvlayor Attest: Kimberly A. Dewis, City Clerk STATE OF ILLINOIS ) ) SS COUNTY OF K A N E ) M MM DIN I, the undersigned, a Notary Public, in and for the County and State aforesaid, DO HEREBY CERTIFY that David J. Kaptain, Mayor of the City of Elgin, an Illinois municipal corporation, and Kimberly A. Dewis, City Clerk of said municipal corporation, and personally known to me to be the same persons whose names are subscribed to the foregoing instrument, appeared before me this day in person and severally acknowledged that as such Mayor and City Clerk, they signed and delivered the said instrument as Mayor and City Clerk as their free and voluntary act, and free and voluntary act and deed of said corporation, for the uses and purposes therein set forth. Given under my hand and official seal this day of September, 2013 IMPRESS NOTARIAL SEAL HERE Notary ubli W OFFICIAL SEAL OLGA De LEON NOTARY PIJBLIC, STATE OF ILLINOIS ruy Commission Expires Aug. 21, 2017 �_ -8- STATE OF ILLINOIS ) ) SS COUNTY OF K A N E ) I, the undersigned, a Notary Public, in and for the County and State aforesaid, DO HEREBY CERTIFY that �&ri d. 1304,ido — chief eke c ui�t}f0 of the Elgin Symphony Orchestra Association and Do ris &0-4r,+ 8w. N64 of said corporation, and personally known to me to be the same persons whose names are subscribed to the foregoing in¢trument, appeared before me this day in person and severally acknowledged that as such Dr�l/7184 -rdeh and Wk 6CJ1ard" , they signed and delivered the said instrument asCkf— q' &wr&*W0F61a and W,- &r AdO- 2 as their free and voluntary act, and free and voluntary act and deed of said corporation, for the uses and purposes therein set forth. TJa rer,.�✓ Given under my hand and official seal this S*I day of-6epternber, 2013. IMPRESS NOTARIAL SEAL HERE Loki SEAL JEANETTE PRIEBE MINA= NOTARY FUBW • STATE OF Y UN= AIYCa1MtrONO�IRfSSiRYf1 , pez:1k l Notary Public F:\Legal Dept\Agreement \Loan Agreement -Elgin Symphony Orchestra- clean- 9- 9- 11doex M