HomeMy WebLinkAbout93-44 Resolution No. 93-44
RESOLUTION
AUTHORIZING EXECUTION OF AN AGREEMENT FOR COMMERCIAL
DEVELOPMENT WITH THE CENTER CITY DEVELOPMENT CORPORATION
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN,
ILLINOIS, that George VanDeVoorde, Mayor, and Dolonna Mecum,
City Clerk, be and are hereby authorized and directed to
execute an Agreement for Commercial Development on behalf of
the City of Elgin with the Center City Development Corporation
for Center City Development Corporation activities at
32-52 Fountain Square Plaza, a copy of which is attached
hereto and made a part hereof by reference.
s/ George VanDeVoorde
George VanDeVoorde, Mayor
Presented: February 10, 1993
Adopted: February 10, 1993
Vote: Yeas 6 Nays 1
Recorded:
Attest :
s/ Dolonna Mecum
Dolonna Mecum, City Clerk
AGREEMENT FOR COMMERCIAL DEVELOPMENT
Agreement, made on this 16th day of February
1993 , between the CITY OF ELGIN, a municipal corporation
(hereinafter referred to as "City") , and CENTER CITY DEVELOPMENT
CORPORATION, an Illinois not-for-profit corporation with offices
in Elgin, Kane County, Illinois (hereinafter referred to as
"Development Corporation") .
WITNESSET H:
WHEREAS, the Development Corporation was granted
Articles of Incorporation by the State of Illinois on August 24 ,
1992 ;
WHEREAS, the purposes for which the Development
Corporation was established are:
(1) to advance the commercial, civic, cultural and
general economic development of the City of Elgin,
Illinois, by doing all things necessary to
improve, redevelop, revitalize, aid and assist the
area described in the City of Elgin's Center City
Master Plan adopted May, 1991, as amended from
time to time;
(2) to advance the civic, cultural and general welfare
of the City of Elgin, Illinois;
(3) either directly or indirectly, and either alone or
in conjunction or cooperation with others, whether
such others be persons or organizations of any
kind or nature, such as corporations, firms,
associations, trusts, institutions, foundations,
or governmental bureaus, departments or agencies,
to do any and all lawful activities which may be
useful or desirable for the furtherance,
accomplishment, fostering or attainment of the
foregoing purposes, including among other things:
(a) to provide advice, support, credit, funds,
capital, gifts and all other lawful forms of
assistance, financial and otherwise, to such
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organization or such organizations organized
and operated exclusively for the charitable
purposes as shall at the time qualify as an
exempt organization or organizations under
Section 501 (c) (3) of the Internal Revenue
Code of 1986 or the corresponding provision
of any future United States Internal Revenue
law, located or locating within the corporate
limits of the City of Elgin, Illinois;
(b) to aid, encourage, support and assist other
persons or organizations furnishing
assistance to organizations located or
locating within the corporate limits of
Elgin, Illinois and such other persons or
organizations seeking to develop and expand
civic, cultural or commercial projects or
enterprises in Elgin, Illinois;
(c) to serve as a developer or redeveloper of
property for the purpose of providing sites,
facilities, and services for public or
commercial developments within the legal
framework of the zoning ordinance,
regulations, and other codes and ordinances
of the City of Elgin, Illinois;
(d) to encourage the use of real property located
within the area described in the City of
Elgin's Center City Master Plan, as amended
from time to time, in such manner as to
forward the civic, cultural or economic
welfare of the City of Elgin by doing all
things necessary to improve, redevelop and
revitalize property within such area; and
(e) to aid and assist property owners, business
owners, residential and commercial tenants to
improve, redevelop and revitalize property
within the area described in the City of
Elgin's Center City Master Plan;
WHEREAS, the Development Corporation desires to acquire
certain real property located in the downtown business district
for the purpose of redevelopment;
WHEREAS, said property is presently predominately
unoccupied;
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WHEREAS, the holder of the first mortgage of said
property has instituted a foreclosure action against said
property;
WHEREAS, the redevelopment and renovation of said
property will increase City's tax base, provide employment
opportunities, and provide cultural opportunities for children;
and
WHEREAS, the renovation and redevelopment of property
to increase the City's tax base, provide employment
opportunities, and provide cultural opportunities for children,
are public purposes within the government and affairs of the City
of Elgin, a home rule unit within the meaning of Article VII of
the Constitution of the State of Illinois.
NOW, THEREFORE, it is hereby agreed by and between the
parties hereto, for and in consideration of the following mutual
covenants and promises:
Section 1. Consideration. The City hereby agrees; in
consideration of the Development Corporation:
(a) acting in good faith to acquire fee simple title
to the property described in Exhibit A, attached
hereto and made a part hereof by reference, or any
portion thereof; or, in the alternative,
(b) acting in good faith to enter into a lease of the
property described in Exhibit A, attached hereto
and made a part hereof by reference, or any
portion thereof; or, in the alternative,
(c) acting in good faith to acquire the current
mortgagee's interest in such property, provided
that the amount paid by the Development
Corporation shall not exceed the amount which the
mortgagor may pay to discharge the mortgage or
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redeem the property in a foreclosure action, upon
the terms and conditions hereinafter stated;
(any one of which alternative acquisitions of interests in said
property or a combination of such approaches encompassing all of
the property described in Exhibit A shall be referred to herein
as the "Redevelopment Property") for the purposes described
hereinabove; to execute a guarantee of the indebtedness of the
Development Corporation described in Section 3 below, in the form
attached as Exhibit B, attached hereto and made a part hereof by
reference.
Section 2 . Acquisition of Property. The Development
Corporation agrees to attempt to acquire the Redevelopment
Property, by June 1, 1993 , for a sum of approximately Seven
Hundred Thousand Dollars ($700, 000) . Prior to the acquisition of
the Redevelopment Property the Development Corporation shall have
entered into written leases for use and occupancy of the
Redevelopment Property, with the following lessees for terms and
rental amounts stated:
Min. Term Min. Annual
Tenant of Lease Rental
Joseph C. Spiess Company 5 years $120, 000
Children's Museum
and Imaginasium 5 years $0. 50 per paid
admission (est.
to amount to
$40, 000 per year)
Downtown News Agency 5 years $ 8 , 000
City of Elgin 5 years $ 22 , 500
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Section 3 . Financing for Acquisition of Redevelopment
Property. Prior to its acquisition of the Redevelopment
Property, Development Corporation shall obtain a written
commitment for an unsecured loan from a lending institution
authorized to make such loan or loans in the aggregate sum of not
less than Nine Hundred Twenty-five Thousand Dollars ($925, 000)
and not more than One Million Fifty Thousand Dollars ($1, 050, 000)
upon the following terms:
Term of Loan: Not less than seven years.
Amortization of Loan: Not less than twenty years.
Interest Rate: Not greater than ten percent (10%)
per annum.
Events of Default: Only non-payment of installments
when due, with written notice of
non-payment being provided to the
City not less than fifteen (15)
days prior to the date such non-
payment shall constitute an event
of default under the terms of the
loan.
Written evidence of such commitment for financing shall be
submitted within sixty (60) days after execution of this
agreement.
Section 4 . Improvements and Maintenance of
Redevelopment Property. Upon acquisition by the Development
Corporation of the Redevelopment Property and the right to
possession of such property, the Development Corporation shall
make the following improvements:
1. Install pull fire alarm system on first floor;
2 . Upgrade washrooms to meet all currently applicable
codes and occupancy guidelines of the City of Elgin and
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to comply with the requirements of the Americans with
Disabilities Act;
3 . Install emergency stairway with access from forth floor
in compliance with currently applicable codes of the
City of Elgin;
4 . Replace windows with more energy efficient and secure
units;
5 . Install appropriate signs on exterior and interior of
building; and
6. Replace worn and damaged floor covering materials in
common areas of building;
7 . Install security system;
8 . Remove and replace interior non-structural partitions
to accommodate tenant requirements.
and shall otherwise maintain the Redevelopment Property in
accordance with applicable ordinances and laws.
Section 5 . Restrictions on Use. Development
Corporation agrees for itself, and its successors and assigns,
and every successor in interest to the Redevelopment Property, or
any part thereof, that while it and its successors and assigns
respectively shall have an interest in the Redevelopment
Property, they shall not discriminate upon the basis of race,
color, religion, sex or national origin in the sale, lease or
rental or in the use or occupancy of the Redevelopment Property
or any improvement located or to be erected thereon, or any part
thereof. Discrimination as used herein shall be interpreted in
accordance with federal and state law, as construed by court
decisions. This covenant may be enforced solely by the City
against those parties who from time to time have an interest in
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the Redevelopment Property in accordance with administrative or
legal proceedings applicable thereto.
Section 6. Prohibition Against Transfer of
Redevelopment Property. The Development Corporation shall not,
prior to the completion of the improvements as set forth in
Section 4 , as certified by the City, make or create or make or
suffer to be made any sale, assignment, conveyance or transfer in
any other form of or with respect to this agreement or the
Redevelopment Property, or any part thereof or any interest
therein, or contract or agreement to do any of the same without
the prior written approval of the City, except the Development
Corporation may lease part or all of the Redevelopment Property
to the tenants listed in Section 2 above and any additional
tenants the Redevelopment Corporation may subsequently identify
and may mortgage said premises as provided in Section 7 .
Section 7 . Limitation Upon Encumbrance of
Redevelopment Property. Prior to the completion of the
improvements as set forth in Section 4 as certified by the City,
except for:
(a) the deed or assignment to the City pursuant to
Section 10 hereinbelow; and
(b) the purposes of obtaining (a) funds to the extent
necessary for constructing and equipping the
improvements as set forth in Section 2 , (b) such
additional funds, if any, in any amount not to
exceed the purchase price paid by Development
Corporation for the Redevelopment Property, (c)
funds to the extent necessary to acquire the
leased fee described on Exhibit A, and (d) funds
necessary for architects, engineers, surveyors,
environmental consultants, legal title and
financing fees, costs and charges, etc. , in
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connection with the purchase of the Redevelopment
Property and the construction and equipping of
such improvements;
neither Development Corporation nor any successor in interest to
the Redevelopment Property shall engage in any financing or any
other transaction creating any mortgage or other encumbrance or
lien upon the Redevelopment Property or suffer any encumbrance or
lien to be made on or attached to the Redevelopment Property.
Section 8 . Time of the Essence. Time is of the
essence of this agreement.
Section 9. Payment of Taxes. Upon its acquisition of
title to the property described in Exhibit A, the Development
Corporation shall be responsible for the timely payment of all
taxes levied in respect to such property. Should the Development
Corporation fail to pay any such taxes when due, the City, at its
option, may pay such taxes and take such actions as it deems
necessary to collect the amount expended in such payment from the
Development Company.
Section 10. Conveyance to City. Upon the acquisition
of any interest in Development Property and in the event that
City, pursuant to its guarantee of the indebtedness of the
Development Corporation or as a result of the failure of the
Development Corporation to pay the taxes described in Section 9
above, shall be required to expended funds on behalf of the
Development Corporation in excess of One Hundred Fifteen Thousand
Dollars ($115, 000) in aggregate, which have not been repaid at
the end of the fiscal year in which City makes the most recent of
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such expenditures, upon request by the City, the Development
Corporation shall convey its interest in the Redevelopment
Property to City. To secure performance of such obligation, upon
the acquisition of any interest in the Redevelopment Property by
the Development Corporation the Development Corporation shall
deliver to City a deed, collateral assignment of leasehold or
collateral assignment of its interest in the mortgage, as the
case may be, for such purposes, which shall be held by City
during the term of this agreement, but shall not be recorded as
long as the Development Corporation is not in default of any
obligation under this agreement.
Section 11. No Conflicting Interests. The Development
Corporation hereby represents and warrants that neither the
Development Corporation, nor any officer or director of the
Development Corporation presently own or have any beneficial
interest in the Redevelopment Property or are entitled to receive
any of the income from the Redevelopment Property. In compliance
with 50 ILCS 105/3 . 1, the Development Corporation shall provide
the City with a written statement, subscribed by an owner,
authorized trustee, corporate official or managing agent of the
Redevelopment Property disclosing the identity of every owner and
beneficiary having any interest, real or personal, in such
property, and every shareholder entitled to receive more than 7-
1/2% of the total distributable income of any corporation having
any interest, real or personal, in such property upon the
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acquisition of any interest in the Redevelopment Property by the
Development Corporation.
Section 12 . Termination of City Obligations. In the
event that Development Corporation fails to acquire the
Redevelopment Property upon the terms described herein by June 1,
1993 , except to the extent that funds have then been advanced to
the Development Corporation in reliance hereof, the obligations
of the City and the Development Corporation hereunder shall
terminate and be of no further force and effect.
IN WITNESS WHEREOF, the parties hereto have set their hands
and seals on the day and date first above written.
CITY OF ELGIN, a municipal
corporation
By �17'1,// �.a4/e/i'e770
Mayo5Y/
Attest:
AeXAArw—
City Clerk
CENTER CITY DEVELOPMENT CORPORATION
By- '--
President
Attest:
//::7
Secretary
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EXHIBIT A
Description of the subject property:
PARCEL 1:
That part of Lots "A" , "B" , "C" , "D" and "E" lying Easterly
of the Easterly line of Riverside Avenue in Harvey and
Amick's Subdivision of Lots 6 and 7 in Block 21 of James T.
Gifford's Plat of Elgin, according to the Plat of said
Harvey and Amick's Subdivision recorded April 17 , 1866 in
Book 2 of maps, page 139 1/2 . in the City of Elgin, Kane
County, Illinois.
ALSO
That part of the Northerly 22 feet of Lot 8 lying Easterly
of the Easterly line of Riverside Avenue, in Block 21 of the
original Town of Elgin as laid out by James T. Gifford, in
the City of Elgin, Kane County, Illinois.
ALSO
Lease made by Amy A. Erickson, et al, to Joseph C. Spiess
Company, an Illinois Corporation, dated June 21, 1941 and
recorded November 10, 1948 as Document 615466, and amended
by Lease Amendment made December 31, 1974 and recorded March
13 , 1975 between Lawrence E. Wolaver and Gertrude Wolaver,
his wife, and Muriel M. Klemm and Robert Klemm, her husband,
and Joseph C. Spiess Company, an Illinois Corporation, as
Document 1321592 demising the land for a term of years
beginning January 1, 1975 and ending December 31, 2010, said
land described as follows:
That part of Lot "F" lying Easterly of the Easterly line of
Riverside Avenue in Harvey and Amick's Subdivision of Lots 6
and 7 in Block 21 of James T. Gifford's Plat of Elgin,
according to the plat of said Harvey and Amick's Subdivision
recorded April 17 , 1866 in Book 2 of Maps, Page 139 1/2 , in
the City of Elgin, Kane County, Illinois.
PARCEL 2 :
That part of Lot "F" lying Easterly of the Easterly line of
Riverside Avenue in Harvey and Amick's Subdivision of Lots 6
and 7 in Block 21 of James T. Gifford's Plat of Elgin,
according to the plat of said Harvey and Amick's Subdivision
recorded April 17 , 1866 in Book 2 of Maps, Page 139 1/2 , in
the City of Elgin, Kane County, Illinois, subject to the
Lease made by Amy A. Erickson, et al, to Joseph C. Spiess
Company, an Illinois Corporation, dated June 21, 1941 and
recorded November 10, 1948 as Document 615466, and amended
by Lease Amendment made December 31, 1974 and recorded March
13 , 1975 between Lawrence E. Wolaver and Gertrude Wolaver,
his wife, and Muriel M. Klemm and Robert Klemm, her husband,
and Joseph C. Spiess Company, an Illinois Corporation, as
Document 1321592 demising the land for a term of years
beginning January 1, 1975 and ending December 31, 2010.
r
EXHIBIT B
GUARANTEE
THE CITY OF ELGIN, Illinois, by resolution duly adopted by
its City Council on February , 1993 , hereby guarantees the
payment when due of all indebtedness of Center City Development
Corporation to Old Kent Bank, an affiliate of old Kent Financial
Corporation of Grand Rapids, Michigan, and its assigns, under a
certain Installment Note dated, , 1993 in the
principal amount of $ and bearing interest at the
rate of % per annum.
The CITY OF ELGIN's obligations under this guarantee shall
be limited to Fifty Thousand Dollars ($50, 000) plus the aggregate
amount advanced to Center City Development Corporation applied
directly towards its acquisition of interests in the real
property described in Exhibit A attached hereto until such time
as Center City Development Corporation has acquired fee simple
title, a lease for a term of fifteen (15) years or longer or a
mortgage of all such real property.
The CITY OF ELGIN's obligations under this guarantee shall
be conditioned upon its receipt of written notice by Old Kent
Bank of any failure by Center City Development Corporation to pay
any installment due under the above described Installment Note
not less than fifteen (15) day prior to the date that such
failure to pay shall constitute an event of default under the
Installment Note.
Dated: CITY OF ELGIN, a municipal
corporation
ByCe<%%2��fit► /•-�c_
Mayor/
Attest:
gig4v1vv-i
City Clerk