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HomeMy WebLinkAbout93-56 Resolution No. 93-56 RESOLUTION ACCEPTING A PROMISSORY NOTE FROM CENTER CITY PLACE LIMITED PARTNERSHIP BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS, that Larry L. Rice, City Manager, be and is hereby authorized and directed to accept a Promissory Note from Center City Place Limited Partnership in the sum of $32 ,500 . 00, a copy of which is attached hereto and made a part hereof by reference. s/ George VanDeVoorde George VanDeVoorde, Mayor Presented: February 24 , 1993 Adopted: February 24 , 1993 Vote: Yeas 7 Nays 0 Recorded: Attest : s/ Dolonna Mecum Dolonna Mecum, City Clerk PROMISSORY NOTE $32,500 . 00 Elgin, Illinois January 15, 1993 For Value Received, the undersigned, Center City Place Limited Partnership, a limited partnership organized and existing under the laws of the State of Illinois (the "Maker" ) having an office at 305 South Green Street, Chicago, Illinois, hereby promises to pay to the order of the City of Elgin, Illinois, a municipal corporation (the "Payee" ) , at its office at 150 Dexter Court, Elgin, Illinois, or such other place as the holder hereof may from time to time designate in writing, on the Maturity Date (as defined below) in lawful money of the United States of America, the principal sum of Thirty Two Thousand Five Hundred and No/100 Dollars ($32 ,500 . 00) or so much thereof as shall from time to time remain outstanding, without interest. The Maturity Date, at which all principal shall become due and payable, shall be the earlier to occur of ( i) the date the holder hereof shall have accelerated the indebtedness under the Note by written demand to the Maker for payment, at any time following the expiration of five years after Project Completion (as herein defined) , or ( ii) January 15, 1999 . "Project Completion" shall mean the date the City of Elgin, in its municipal capacity, issues a certificate of occupancy for the property commonly known as 156-158 Dexter Court, Elgin, Illinois (the "Project" ) , following rehabilitation by the Maker. Privilege is reserved to make principal payments in whole or in part without premium or fee. Any one of the following occurrences shall constitute a "Default" under this Note: (a) The occurrence of a default by Maker in failing to make any payment of principal upon this Note as and when the same becomes due and payable in accordance with the terms hereof, which default shall not be cured within five (5) Business Days after the due date of such payment; (b) The occurrence of any default under this Note other than as described in the preceding clause (a) which default shall not have `been cured by the Maker within thirty ( 30) days of the occurrence of such default; or (c) Failure of Maker to apply for sanitary sewer permits from the Fox River Water Reclamation i District within seven (7) days of the date of execution of this Note. Upon the occurrence of a Default hereunder: (i) the entire unpaid principal balance of this Note shall, at the option of the holder hereof and without notice or demand of any kind to Maker or any other person, immediately become due and payable; and ( ii) the holder hereof shall have and may exercise any and all rights and remedies available at law or in equity. The remedies of the holder hereof shall be cumulative and concurrent, and may be pursued singularly, successively or together, at the sole discretion of the Payee, and may be exercised as often as occasion therefore shall arise. No act of omission or commission of the Payee, including specifically any failure to exercise any right, remedy or recourse, shall be deemed to be a waiver or release of the same, such waiver or release to be effected only through a written document executed by the Payee and then only to the extent specifically recited therein. A waiver or release with reference to any one event shall not be construed as continuing, as a bar to, or as a waiver or release of, any subsequent right, remedy or recourse as to a subsequent event. Timely performance of all of Maker's obligations herein is of the essence. If any suit or action is instituted by an attorney employed to collect this Note or any part thereof, the Maker promises to pay all costs of collection, including reasonable attorney' s fees and expenses, court costs, and expenses of every kind incurred by the Payee in connection with such collection. Maker for itself and for is successors, transferees and assigns and all guarantors, endorsers and signers, hereby waives all valuation and appraisement privileges, presentment and demand for payment, protest, notice of protest and nonpayment, dishonor and notice of dishonor, bringing of suit, lack of diligence or delays in collection or enforcement of this Note and notice of the intention to accelerate, the release of any party liable, the release of any security for the debt, the taking of any security and any other indulgence or forbearance, and agrees that this Note and any or all payments coming due hereunder may be extended or renewed from time to time without in any way affecting or diminishing Maker' s liability hereunder. All notices or other communications hereunder to either party shall be (a) in writing and, if mailed, shall be deemed to be given on the third Business Day after the date when deposited in the United States mail, by registered or 2 certified mail, postage prepaid, addressed as provided hereinafter, and (b) addressed: If to Maker: c/o Center City Place Joint Venture Merriam/Zuba, Ltd. 305 South Green Street Chicago, Illinois Attention: Henry Zuba With a copy to: Keck, Mahin & Cate 77 West Wacker Drive 49th Floor Chicago, IL 60601-1693 Attention: Mark W. Burns, Esq. ( 312) 634-7700 If to Payee: City of Elgin 150 Dexter Court Elgin, Illinois 60120 Attention: City Manager With a copy to: City of Elgin 150 Dexter Court Elgin, Illinois 60120 Attention: Michael Gehrman, Esq. or to either party at such other addresses as such party may designate in a written notice to the other party. "Business Day" shall mean any day when Payee is open for business other than Saturday, Sunday or any other day on which national banks in Elgin, Illinois are not open for business . If any provision of this Note or any payments pursuant to the terms hereof shall be invalid or unenforceable to any extent, the remainder of this Note and any other payments hereunder shall not be affected thereby and shall be enforceable to the greatest extent permitted by law. All payments under this Note shall be payable in lawful money of the United States which shall be legal tender for public and private debts at the time of payment. Each payment of principal or interest under this Note shall be paid not later than 2 : 00 P.M. Elgin, Illinois time on the date due therefor and funds received after that hour shall be deemed to have been received by Payee on the following day. All payments not received in immediately available funds are subject to collection. This Note shall be governed by and construed under the laws of the State of Illinois . The Maker shall have liability for the obligation to pay principal under this Note. Notwithstanding the Maker' s liability for payment of principal of this Note, the Payee 3 shall have no recourse against the Project or Maker's interest therein for collection of amounts due hereunder, through foreclosure or receivership of the Project, all such recourse being waived by the Payee. Payee shall have recourse to and Maker shall make payments from net operating revenues derived from the Project, being gross rental income and other Project receipts less Project operating and capital expenses, reserves and debt service on mortgage financing encumbering the Project. To further secure the payments due hereunder from net operating revenues of the Project, the Maker herein grants to Payee a security interest in and encumbrance upon said net operating revenues of the Project and this Note shall be deemed a security agreement under the Uniform Commercial Code as adopted in Illinois (the "Act" ) for said purposes . Maker shall further execute and file financing statements to perfect and continue perfection of the security interests herein granted as required by the Act. The security interest granted by this Note shall be and remains subordinate and junior to all liens and encumbrances now existing or hereinafter created securing indebtedness of the Maker which liens or encumbrances currently or in the future constitute encumbrances against the Project. IN WITNESS WHEREOF, the undersigned has signed and delivered this Note as of the day and year first above written. Center City Place Limited Partner- ship, an Illinois limited partner- ship, By: Center City Place Joint Venture, its general partner By: Merriam/Zuba, Ltd. , its general partner, an Illinois corporation By te'1/4" Name: Henry Zuba Title: President 4 Ell I • �y OF 11)E1C� Memorandum ,Lid% February 19, 1993 TO: Mayor and Members of the City Council FROM: Larry L. Rice, City Manager SUBJECT: Center City Place Promissory Note Enclosed is the form of the Promissory Note with Center City Place Limited Partnership. This matter appears as item D and item 10 on the Committee of the Whole and regular agen- das, respectively. On Friday, it was learned from the developer that their tax attorneys have determined a loan made with Community Development Block Grant (CDBG) funds could not be accepted. Apparently, using CDBG funds could somehow jeopardize the nearly $1 million in tax credits which are being used to help finance the project. Staff believes the $32 ,500 could be made available from the Capital Improvement Fund (385) . The $32 ,500 in the CDBG program earmarked for the Center City Place project would then be reprogrammed for this year' s grant allocation process . If the City Council would like to proceed with the loan, the motion approving the Promissory Note should also author- ize the appropriation of the loan proceeds from the Capital Improvement Fund. The Promissory Note is silent on the funding source of the loan and, therefore, no changes are necessary in the document. Larr . Ric City Manager LLR:amp Attachment