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HomeMy WebLinkAbout08-98 • Resolution No. 08-98 RESOLUTION APPROVING LOAN UNDER THE SPECIAL BUSINESS LOAN PROGRAM FOR BUILDING IMPROVEMENTS IN ELGIN CENTER CITY (Tongue N Chic, Inc.-14-16 Douglas Avenue) WHEREAS, the City of Elgin and certain banks and savings and loan institutions have established a special business loan program for building improvement in Center City Elgin for revitalization purposes; and WHEREAS,Brandon Becker(Tongue N Chic,Inc.)has submitted an application to Citibank for a loan under the special business loan program; and WHEREAS, Citibank has approved this loan under the special business loan program; and WHEREAS, the loan is for the improvement of a type of business located in an area of the Center City of Elgin which meets the eligibility requirements of the special business loan program; and WHEREAS, the loan application meets the general requirements concerning type of financing, contractor bids of the special loan program; and WHEREAS, the loan applicants meet the qualifying standards as set out in the special business loan program; and WHEREAS,it is determined that funds are available for the loan,the development plans are compatible with the Center City development plans, and the application is in adherence to the objectives and regulations of the program. NOW, THEREFORE, IT IS RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN,ILLINOIS,that Olufemi Folarin,City Manager,and Diane Robertson,City Clerk,are hereby authorized to approve the special business loan agreement as set forth in the loan approval of Citibank attached hereto and made a part hereof by reference,and to make monthly interest payments in the amount indicated on the Center City special business loan agreement between Brandon Becker (Tongue N Chic, Inc.) and the City. s/Ed Schock Ed Schock, Mayor • Presented: April 9, 2008 Adopted: April 9, 2008 Omnibus Vote: Yeas: 6 Nays: 0 Attest: s/Diane Robertson Diane Robertson, City Clerk V • CITY OF ELGIN CENTER CITY SPECIAL BUSINESS LOAN AGREEMENT THIS AGREEMENT is hereby made and entered into this 9th day of April 2008, by and between the City of Elgin, Illinois, a municipal corporation (hereinafter referred to as the "City" ) , and Tongue N Chic, an Illinois Corporation (hereinafter referred to as the "Owner" ) . WHEREAS, the City has established a City of Elgin Center City Special Business Loan Program for building improvements in the City' s Center City area in an effort to stimulate expansion, reinvestment and business retention, a copy of such Center City Special Business Loan Program for building improvements being attached hereto and made a part hereof as Exhibit A (hereinafter referred to as the "Program" ) ; and WHEREAS, the Program contemplates the City paying a portion of financing costs for eligible building improvements; and WHEREAS, Brandon Becker is the Owner of the property commonly known as 14-16 Douglas Ave, Elgin, Illinois, (hereinafter referred to as the "Subject Property" ) which is located in the Center City area as described in Program; and WHEREAS, Owner has applied for and obtained approval for a loan agreement to finance the cost of the proposed building improvements on the subject property, a copy of the subject loan agreement being attached hereto and made a part hereof as Exhibit B (hereinafter referred to as the "Subject Loan Agreement" ) ; and WHEREAS, Owner has completed an application for K. participation in the subject Program which identifies the proposed improvements to the Subject Property, a copy of Owner' s application for participation in the Subject Program being attached hereto and made a part hereof as Exhibit C. NOW, THEREFORE, for and in consideration of the mutual promises, covenants and undertakings contained herein, and other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto agree as follows : 1 . That the foregoing recitals are hereby incorporated into this agreement in their entirety. 2 . That Owner' s application for participation in the Program is hereby approved. 3 . That as long as the Owner continues to make regularly scheduled loan payments on the Subject Loan Agreement and otherwise complies with the terms of this agreement City shall pay an interest subsidy on the Subject Loan Agreement consisting of monthly reimbursement payments to Owner in the amount equal to 90% of the first year' s interest, 80% of the second year' s interest, 70% of the third year' s interest, 60% the fourth year' s, and 50% the fifth and final year' s interest, commencing April 9 2013, upon receipt of verification of payment from lender and pursuant to the amortization and payment schedules attached here to and made a part hereof as Exhibit D. 4 . In no event shall the interest rate exceed fifteen 2 (15%) percent . In no event shall the total loan amount exceed $200, 000 . In no event shall the interest payments exceed $44, 733 .40 . The Owner shall make all other principal and interest payments and all other payments on the Subject Loan Agreement . It is expressly agreed and understood that the City is not and shall not be deemed to be a party to the Subject Loan Agreement or an obligor or obligee thereunder. This agreement in general, and the City' s agreement to make interest payments hereunder in particular, shall not be construed, and shall not be relied upon by any party, including, but not limited to, the lender in the subject loan agreement or any successor or assign thereof, to require the repayment of any principal loan amounts, the execution of any mortgage loan documents, or to otherwise act as a guarantor on any loan agreements under any circumstances . Additionally, the provisions of this agreement shall not be construed so as to create any obligations as to City based on any theory of equitable estoppel . 5 . In the event the Owner conveys any of its interest in Subject Property prior to April , 2013 , Owner shall refund all payments made by city pursuant to this agreement no later than 30 days after such conveyance . 6 . That the terms, requirements and conditions of the 3 Program as set forth in Exhibit A hereto are hereby incorporated into this agreement in their entirety. The City' s obligations under this agreement including but not limited to the City' s obligations to make continued interest payments are subject to Owner' s ongoing compliance with all terms and requirements of the program and this agreement . 7 . That upon completion of the improvements and acceptance of such improvements in writing by the City, and for a period of Five (5) years thereafter, Owner shall properly maintain the improvements in their finished form, without alteration or change thereto. 8 . That nothing herein is intended to limit, restrict or prohibit the Owner from undertaking other work in orabout the Subject Property which is unrelated to the improvements provided P Y P for in this agreement . 9 . That this agreement may not be assigned without the prior written consent of the City. 10 . Owner hereby agrees to hold harmless, defend and indemnify the City from and against any and all causes of action, suits, claims for damages and anyand all other liabilitywhich 9 may arise out of or in connection with the proposed improvements or other work at the Subject Property, or which may arise out of or in connection with Owner' s or Owners ' agents, employees' , contractors' and assigns' negligent performance of any of the 4 terms of this agreement . In the event the provisions of this paragraph are invoked, counsel for City shall be of City' s choosing . The terms and provisions of this paragraph shall survive any termination and/or expiration of this agreement . 11 . That this agreement shall not be construed so as to create a joint venture, partnership, employment or other agency relationship between the parties hereto . 12 . Owner shall also pay when due all other obligations for the subject property including but not limited to payments on any other loans, real estate taxes and insurance . 13 . That this agreement shall be subject to and governed by the laws of the State of Illinois . Venue for the resolution of any disputes or the enforcement of any rights arising out of or in connection with this agreement shall be in the Circuit Court of Kane County, Illinois . 14 . That the terms of this agreement shall be severable . In the event that any of the terms or provisions of this agreement are deemed to be void or otherwise unenforceable for any reason, the remainder of this agreement shall remain in full force and effect . 15 . That notices regarding in this agreement shall be sent to the parties at the following addresses : 5 To: City of Elgin 150 Dexter Court Elgin, IL 60120-5555 Attention: City Manager (with a copy to Corporation Counsel) To: Tongue N Chic Attn: Brandon Becker 14-16 Douglas Ave. Elgin, IL 60120 16 . This agreement constitutes the only agreement between the parties hereto. There are no other agreements, either oral or implied, in existence between the parties hereto. The terms and provisions of this agreement shall not be amended unless such amendments are in writing and, are properly executed by the parties hereto. 17 . In the event of Owner' s breach of any of the terms of this agreement, Owner shall refund to City the full amount of any payments made by City to Owner or to any other entity on Owner' s behalf, including but not limited to, any lender, upon thirty (30) days written demand. City shall thereafter be entitled to any and all other rights and remedies as may be available to it by law. 18 . This agreement shall terminate on April 9th, 2013 . City may terminate this agreement for any or no reason upon fourteen (14) days written notice. In the event City terminates this agreement, City shall be under no further obligations pursuant to this agreement, and Owner shall be entitle to no further relief 6 pursuant to this agreement . IN WITNESS WHEREOF, the parties hereto have entered into and executed this agreement the day and year first written above . CITY OF ELGIN Tongue , By ,,(l�,c, . �z /Sies B Oluf mi Folarin Brand n Becker City Manager Owner Attest : Attest : _, City Clerk 7