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HomeMy WebLinkAbout93-90 Resolution No. 93-90 RESOLUTION AUTHORIZING EXECUTION OF AN AMENDMENT TO AGREEMENT FOR COMMERCIAL DEVELOPMENT WITH 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 Amendment to Agreement for Commercial Development on behalf of the City of Elgin with the Center City Development Corporation for 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: March 31, 1993 Adopted: March 31, 1993 Vote: Yeas 5 Nays 0 Recorded: Attest : s/ Dolonna Mecum Dolonna Mecum, City Clerk Elm Agenda Item No. March 29, 1993 MEMORANDUM TO: Mayor and Members of City Council FROM: Larry Rice, City Manager SUBJECT: Amendment to Agreement for Commercial Development with Center City Development Corporation PURPOSE: The Legal Department requests approval of an amendment to the previous contract with Center City Development Corporation for the Spiess Building at 32-52 Fountain Square Plaza. BACKGROUND: On February 10, 1993, the City Council approved the agreement for commercial development with Center City Development Corporation for the acquisition and improvement of the Spiess Building in Fountain Square Plaza. In the Development Corporation' s efforts to obtain loan proceeds to purchase the property, the lender has required a different form of guaranty to be utilized other than which was set forth in Exhibit B to the original agreement. The lender is also requiring the execution of an opinion letter by the Corporation Counsel . The Legal Department is also recommending the use of an escrow agreement to insure the proper application of loan proceeds which are in excess of the purchase price which are intended to be utilized for improvements to the building. Finally, the Legal Department is recommending amending the current agreement to provide for the city to obtain and record a mortgage against the property to secure its interests . FINANCIAL IMPACT: There are no additional costs or liabilities to the city as a result of the proposed amendment to the subject contract. RECOMMENDATION: The Legal Department recommends that the City Council approve the proposed amendment to the agreement for commercial evelopment with Center City Development Corporation. La L. Rice, City Manager AMENDMENT TO AGREEMENT FOR COMMERCIAL DEVELOPMENT THIS AGREEMENT, made on this 164, day of 4- ,27 1993, between the CITY OF ELGIN, Illinois, a municipal corporation (hereinafter referred to as "CITY" ) and the CENTER CITY DEVELOPMENT CORPORATION, an Illinois not-for-profit corporation with offices in Elgin, Kane County, Illinois (hereinafter referred to as DEVELOPMENT CORPORATION) , WITNESSETH: WHEREAS, the parties hereto entered into an Agreement for Commercial Development (hereinafter referred to as the "Subject Agreement" ) which was authorized and approved by resolution of the City Council of the City on February 10, 1993; and WHEREAS, the subject agreement for commercial development provided in part for the City to sign a guaranty for a loan to be obtained by the Development Corporation for the acquisition of certain real estate, with the form of the guaranty being attached to the subject agreement as Exhibit B; and WHEREAS, in the Development Corporation' s efforts to obtain loan proceeds to purchase the subject matter property the lender has required a different form of guaranty to be utilized other than which was set forth in Exhibit B to the subject Agreement and is also requiring the execution of an opinion letter by the corporation counsel; and WHEREAS, the subject Agreement for Commercial Development provides that the Development Corporation shall have entered into written leases for use and occupancy of the subject real estate with certain tenants prior to the acquisition of interests in such real estate by the Development Corporation; and WHEREAS, due to the complexity of the ongoing negotiations with the Children' s Museum and Imaginasium and the need for additional architectural drawings of existing and planned improvements to the subject real estate to more clearly define that portion of the premises to be subject to the leases with the Children' s Museum and Imaginasium and the City of Elgin, it may not be practicable or prudent for the Development Corporation to enter into the signed leases with the Children' s Imaginasium and the City of Elgin prior to the date scheduled for the acquisition of the interests in the subject real estate by the Development Corporation currently scheduled for April 8, 1993; and -2- WHEREAS, in order to better secure the City' s substantial obligations pursuant to the proposed guaranty, the parties have determined it is appropriate for the City to obtain and record a mortgage against the subject real estate securing its interests in the property; and WHEREAS, in order to insure the proper application of loan proceeds in excess of the purchase price which are intended to be utilized for improvements to the building on the subject property, the parties hereto have determined it is appropriate for the parties to enter into an escrow agreement containing instructions over the distribution of loan proceeds . NOW, THEREFORE, it is hereby agreed by and between the parties hereto, for an in consideration of the mutual covenants and promises contained within the original subject agreement for commercial development between the parties and the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged: 1 . That this Amendment Agreement is hereby incorporated into and amends the Agreement for Commercial Development between the City and the Development Corporation previously authorized and approved by the City Council of the City on February 10, 1993 . 2 . That the original form of guaranty attached to the February 10, 1993, Agreement for Development is hereby deleted from the subject Agreement and replaced by the form of guaranty attached hereto as Exhibit B. 3 . That Section 1 of the subject Agreement for Development be and is hereby amended by adding the following at the end of said Section 1 : "Further, Corporation Counsel is hereby authorized to execute and deliver an opinion letter in the form attached hereto as Exhibit C. " 4 . That Section 2 of the subject Agreement for Development be and is hereby amended by deleting the references to the leases with the Children' s Museum and Imaginasium and the City of Elgin from the existing list of lessees, terms and rental amounts listed within the subject agreement and by adding the following at the end of said Section 2 : "Further, within sixty ( 60) days of the acquisition of the redevelopment property by the Development -3- Corporation, the Development Corporation shall enter into written leases for use and occupancy of the redevelopment property with the following Lessees for terms and rental amounts stated: Tenant Min. Term Min .Annual of Lease Rental Children' s Museum 5 years $0 . 50 per paid and Imaginasium admission (est. to amount to $40, 000 per year) City of Elgin 5 years $ 22,500" 5 . That Section 10 of the subject Agreement for Development be and is hereby amended by deleting the last sentence of said Section 10 and by adding in its place: "To further secure performance of such guaranty obligation, concurrently with each acquisition of an interest in the subject property, the Development Corporation shall execute and deliver to the City: (a) In the case of an acquisition of an interest in fee or leasehold, a mortgage of the subject real estate in favor of the City of Elgin. The amount of the mortgage shall be for the total loan amount of $1,050,000. 00 and shall be recorded against the title to the subject real estate; or (b) In the case of an acquisition of a note, mortgage and judgment of foreclosure and sale, a collateral assignment in favor of the City of any note secured by an existing mortgage of an interest in the subject property. Upon receipt of a deed to such mortgage real estate property through the prosecution of its rights under such acquired note and mortgage and judgment, the Development Corporation shall deliver a mortgage of such real estate as provided in paragraph (a) above. Upon repayment of the entire subject loan by the Development Corporation, the City shall provide the Development Corporation with a full release of said mortgage and/or collateral assignment. " -4- 6 . That the subject Agreement for Development be and is hereby further amended by adding the following new Section 13 at the end of said agreement: "Section 13 . Escrow of Loan Proceeds . To assure the City that the proceeds of the loan to be guaranteed by the City hereunder are utilized in a manner consistent with this Agreement, all loan proceeds shall be placed in an escrow account with Chicago Title and Trust Company. Corporation Counsel is hereby directed and authorized to prepare and the City Manager is hereby authorized to execute and deliver in conjunction with the Development Corporation, escrow instructions to Chicago Title P 9 and Trust Company providing for the disbursement of loan proceeds not exceeding $50, 000, plus the aggregate amount applied directly toward the acquisition of interests in the subject real estate until such time as the Development Corporation has the interests or combination of interests specified in Section 1 above. " CENTER CITY DEVELOPMENT CITY OF ELGIN CORPORATION By �� /. By L E.C. Wilson, President Georg anDeVoorde, Mayor Attest: Attest: ecretary City Clerk oldkent.gop GUARANTY OF PAYMENT THIS GUARANTY OF PAYMENT ( "Guaranty" ) , made as of the day of March, 1993, by CITY OF ELGIN, a municipal corporation ( "Guarantor" ) to and for the benefit of OLD KENT BANK ( "Lender" ) . RECITAL S: A. Lender, OLD KENT BANK, and CENTER CITY DEVELOPMENT CORPORATION, an Illinois not for profit corporation ( "Borrower" ) have entered into a Loan Agreement of even date herewith (the "Loan Agreement" ) providing for a loan in the amount of One Million Fifty Thousand and 00/100 Dollars ($1,050,000 . 00) (the "Loan" ) to Borrower. B. Pursuant to the Loan Agreement, Borrower has executed and delivered a Note to Lender in the full amount of the Loan (the "Note" ) . C. Lender has required, as a condition precedent to disbursement of the Loan under the Loan Agreement, that Guarantor execute and deliver this Guaranty of all sums due under the Note. NOW, THEREFORE, in consideration of the Premises and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, Guarantor agrees as follows: GUARANTOR ACKNOWLEDGES THAT LENDER IS MAKING THE LOAN AGREEMENT BASED PRIMARILY UPON THE CREDIT OF GUARANTOR AND LENDER WOULD NOT MAKE THE LOAN BASED SOLELY UPON THE BORROWER'S FINANCIAL CONDITION. FURTHERMORE, GUARANTOR ACKNOWLEDGES THE LENDER HAS RECEIVED NO COLLATERAL TO SECURE THE NOTE. IT IS SPECIFICALLY AGREED THAT LENDER WILL ACCEPT PAYMENTS MADE DIRECTLY BY GUARANTOR TO LENDER DURING THE CURE PERIOD (HEREINAFTER DEFINED) PROVIDED GUARANTOR SPECIFICALLY DIRECTS SUCH PAYMENTS MADE BY IT BE APPLIED TO THE NOTE. 1. Guaranty. Guarantor absolutely, unconditionally and irrevocably guarantees to Lender: (a) the full and prompt payment when due, whether at stated maturity, upon acceleration or otherwise, and at all times thereafter, of any and all debts, liabilities, and obligations of Borrower as specified in the Note it being understood that the Note may not be accelerated until the Cure Period (hereinafter defined) has expired; and Exhibit "B" oldkent.gop (b) the payment of all Enforcement Costs (as hereinafter defined) . All amounts due, debts, liabilities and payment obligations described in subparagraphs (a) and (b) of this Paragraph 1 are referred to herein as the "Indebtedness" . 2 . Lender's Remedies. The term "Cure Period" shall mean twenty-five (25) days after Lender has given Guarantor written notice of default by Borrower in the payment of interest or principal and thirty (30) days after Lender has given Guarantor written notice of default by Borrower in the performance or observance of any other covenant or agreement of Borrower in the Note or Loan Agreement, it being understood that the Cure Period shall run concurrently with any period for cure provided for in the Note. In the event of any default by Borrower under the Note or Loan Agreement, after the expiration of the Cure Period, Guarantor agrees, on demand by Lender to pay all sums guaranteed or due hereunder regardless of any defense, right of set-off or claims which Borrower or Guarantor may have against Lender. This is an absolute, irrevocable, present and continuing guaranty of payment and not of collection. In any action to enforce this Guaranty, Lender, at its election, may proceed against Guarantor, with or without (i) joining Borrower in any such action; (ii) commencing any action against or obtaining any judgment against Borrower; or (iii) commencing any proceeding to enforce the Loan Agreement. In fact, Guarantor acknowledges that Lender's intent is to proceed directly against Guarantor without resorting to remedies against Borrower. 3. Extension and Reinstatement of Guaranty. This Guaranty shall continue to be effective, or be reinstated, as the case may be, if at any time any whole or partial payment of the Indebtedness is or is sought to be rescinded or must otherwise be restored or returned by Lender upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of Borrower or Guarantor or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, Borrower or Guarantor, all as though such payments had not been made. Without limiting the generality of the foregoing, this Guaranty shall not be released, satisfied or discharged, until one ( 1) full calendar year has elapsed since the full payment of the Indebtedness and for so long thereafter as there is pending against Borrower or Guarantor a proceeding under any federal or state bankruptcy or insolvency laws . 4 . No Discharge. Guarantor agrees that the obligations, covenants and agreements of Guarantor under this Guaranty shall not be affected or impaired by any act of Lender, 2 oldkent.gop or any event or condition except payment in full of the Indebtedness and any other sums due hereunder. Guarantor agrees that, without payment in full of the Indebtedness, the liability of Guarantor hereunder shall not be discharged by (i) the renewal or extension of time for the payment of the Indebtedness under the Note, or any other agreement relating to the Indebtedness, whether made with or without the knowledge or consent of Guarantor; (ii) any transfer of the Note or the Loan Agreement; (iii) the existence of any defenses to enforcement of the Note or the Loan Agreement; (iv) any failure, omission, delay or inadequacy, whether entire or partial, of Lender to exercise any right, power or remedy regarding the Loan; (v) the existence of any set-off, claim, reduction, or diminution of the Indebtedness, or any defense of any kind or nature, which Guarantor may have against the Borrower or which any party has against Lender; or (vi) the addition of any and all other indorsers, guarantors, obligors and other persons liable for the payment of the Indebtedness and the acceptance of any and all other security for the payment of the Indebtedness; all whether or not Guarantor shall have had notice or knowledge or any act or omission referred to in the foregoing clauses (i) through (vi) of this Paragraph. Guarantor intends that Guarantor shall remain liable hereunder as a principal until all Indebtedness shall have been paid in full, notwithstanding any fact, act, event or occurrence which might otherwise operate as a legal or equitable discharge of a surety or guarantor. 5. Application of Amounts Received. Intentionally omitted. 6 . Waiver. Guarantor expressly waives (i) notice of the acceptance by Lender of this Guaranty; (ii) notice of the existence, creation, payment or nonpayment of the Indebtedness except for the notice to commence the Cure Period; (iii) presentment, demand, notice of dishonor, protest, and all other notices whatsoever except for the notice to commence the Cure Period; (iv) the right to trial by jury in any action to enforce this Guaranty; and (v) any failure by Lender to inform Guarantor of any facts Lender may now or hereafter know about the Borrower, the Loan or the transactions contemplated by the Loan Agreement, it being understood and agreed that Lender has no duty so to inform and that Guarantor is fully responsible for being and remaining informed by the Borrower of all circumstances bearing on the existence, creation, or risk of non-payment of the Indebtedness except for the notice to commence the Cure Period. Credit may be continued from time to time by Lender to Borrower without notice to or authorization from Guarantor, regardless of the financial or other condition of the Borrower at the time of any continuation. Lender shall have no obligation to disclose or 3 oldkent.gop discuss with Guarantor its assessment of the financial condition of Borrower. No modification or waiver of any of the provisions of this Guaranty will be binding upon Lender except as expressly set forth in a writing duly signed and delivered on behalf of Lender. Guarantor further waives and agrees not to invoke any right or claim to have a stay imposed on the enforcement of this Guaranty in connection with any case or proceeding under the bankruptcy laws of the United States of America. 7 . Enforcement Costs. If (i) this Guaranty or the Note is placed in the hands of one or more attorneys for collection or is collected through any legal proceeding; (ii) one or more attorneys are retained to represent Lender in any bankruptcy, reorganization, receivership, or other proceedings affecting creditors ' rights and involving a claim under this Guaranty, the Note or the Loan Agreement; or (iii) one or more attorneys are retained to represent Lender in any other proceedings whatsoever in connection with this Guaranty, the Note or the Loan Agreement, then Guarantor shall pay to Lender upon demand all reasonable attorneys ' fees, costs and expenses, including, without limitation, court costs, filing fees, and all other costs and expenses incurred after the Cure Period in connection therewith (all of which are referred to herein as "Enforcement Costs" ) , in addition to all other amounts due hereunder; provided that enforcement costs shall not include attorneys ' fees, costs or expenses incurred solely as a result of Borrower's failure to make payments of principal and interest until the Cure Period has expired. 8 . Transfer of Indebtedness. Notwithstanding any assignment or transfer of the Indebtedness or any interest therein, all portions of the Indebtedness including those assigned or transferred shall be and remain Indebtedness for the purposes of this Guaranty, and each and every immediate and successive assignee, transferee or other successor in interest with respect to such Indebtedness or interest shall, to the extent of the Indebtedness or interests assigned or transferred, be entitled to the benefits of this Guaranty to the same extent as if such assignee or transferee were Lender; provided, however, that unless the assignor or transferor shall otherwise consent in writing, the assignor or transferor shall have an unimpaired right, prior and superior to that of its such assignee or transferee, to enforce this Guaranty for its benefit as to such portions of the Indebtedness or interest therein not assigned or transferred. 9 . Governing Law; Interpretation. This Guaranty has been negotiated, executed and delivered in Elgin, Illinois, and shall be governed by the laws of the State of Illinois without 4 oldkent.gop reference to the conflicts of law principles of that State. The headings of sections and paragraphs in this Guaranty are for convenience only and shall not be construed in any way to limit or define the content, scope, or intent of the provisions hereof, As used in this Guaranty, the singular shall include the plural, and masculine, feminine, and neuter pronouns shall be full interchangeable, where the context so requires . If any provision of this Guaranty, or any paragraph, sentence, clause, phrase or word, or the application thereof, in any circumstances, is adjudicated by a court of competent jurisdiction to be invalid, the validity of the remainder of this Guaranty shall be construed as if such invalid part were never included herein. Time is of the essence in this Guaranty. All payments to be made hereunder shall be made in currency and coin of the United States of America which is legal tender for public and private debts at the time of payment. 10 . Entire Agreement. This Guaranty constitutes the entire agreement between the parties with respect to the subject matter hereof and supersede all prior such agreements and understandings, both written and oral. This Guaranty may not be modified or amended except by a written instrument signed by Lender and Guarantor. If this Guaranty is executed in several counterparts, each of those counterparts shall be deemed an original, and all of them together shall constitute one and the same instrument. 11 . Lender's Security Interest. Intentionally omitted. 12 . Prohibitions on Loans or Advances. Intentionally omitted. 13 . Payment of Indebtedness. Lender agrees that the obligations of Guarantor under this Guaranty shall terminate, subject to the provisions of paragraph 3 hereof, one ( 1) year after the date on which Lender shall have received payment of all Indebtedness and all other sums due and owing under this Guaranty. Release of this Guaranty, if it occurs, however, shall not affect, in any respect, the Note or any other instrument securing or guarantying the Indebtedness. 14 . Waiver of Indemnification and Other Rights. Intentionally omitted. 15 . Additional Representations and Warranties. In addition to and independent of any other obligation or liability under this Guaranty, Guarantor hereby represents and warrants to Lender as follows: 5 oldkent.gop (a) Any and all balance sheets, net worth statements and other financial data with respect to Guarantor which have heretofore been given to Lender by or on behalf of Guarantor fairly and accurately present the financial condition of Guarantor as of the respective dates thereof, and, since the respective dates thereof, there has been no material adverse change in the financial condition of Guarantor; (b) The execution, delivery and performance by Guarantor of this Guaranty do not and will not contravene or conflict with (i) any law, order, rule, regulation, writ, injunction or decree now in effect of any government, governmental instrumentality or court having jurisdiction over Guarantor, or (ii) any contractual restriction binding on or affecting Guarantor or any of Guarantor's property or assets; (c) This Guaranty creates legal, valid and binding obligations of Guarantor enforceable against Guarantor in accordance with its terms; (d) Except as disclosed in writing to Lender, there is no action, proceeding or investigation pending, or, to the knowledge of Guarantor, threatened or affecting Guarantor, which may adversely affect the ability of Guarantor to pay the Indebtedness . (e) Guarantor has disclosed all events, conditions and facts known to Guarantor which could have any material adverse effect on the financial condition of Guarantor. No representation or warranty by Guarantor contained herein, nor any schedule, certificate or other documents furnished by Guarantor to Lender in connection with this Guaranty contains any material misstatement of fact or omits to state a material fact or any fact necessary to make the statements contained therein not misleading. Guarantor hereby indemnifies Lender and agrees to defend and hold harmless Lender from and against (any loss, cost, damage or expense occurring by reason of a breach of the foregoing representations and warranties; and (b) the loss, mitigation, subordination or other consequences adverse to Lender by reason of this Guaranty being challenged as a preference or suffering any other subjugation under any bankruptcy or other law, whether state or federal, affecting debtors, creditors and/or the relationship between and among them. 16 . Successors and Assigns. It is agreed that the undersigned's liability hereunder is several and independent of any other guaranties or other obligations at any time in effect 6 • oldkent.gop with respect to the Indebtedness or any part thereof and that Guarantor's liability hereunder may be enforced regardless of the existence, validity, enforcement or non-enforcement of any such other guaranties or other obligations . 17 . Jurisdiction and Venue. Intentionally omitted. 18. Notices. Any notice, demand or other communication which either party may desire or may be required to give to the other party shall be in writing, and shall be deemed given if an when personally delivered, or on the second business day after being deposited in United States registered or certified mail, postage prepaid, addressed to the intended recipient at its address set forth below, or to such other address as such intended recipient may have designated by notice furnished in accordance herewith: If to Lender: Old Kent Bank 28 North Grove Avenue Elgin, Illinois 60120 ATTN: Mr. James Allen With a copy to: Roger K. Frandsen 2425 Royal Boulevard Elgin, Illinois 60123 If to Guarantor: City of Elgin 150 Dexter Court Elgin, Illinois 60120 ATTN: City Manager With a copy to: City of Elgin 150 Dexter Court Elgin, Illinois 60120 ATTN: Corporation Counsel Except as otherwise specifically required herein to commence the Cure Period, notice of the exercise of any right, option or power granted to Lender by this Guaranty is not required to be given. 7 oldkent.gop SIGNED AND DELIVERED the date first above specified. GUARANTOR: CITY OF ELGIN, a municipal corporation By: 4 if _/A4.iLell%)/)fi ---- Mayor Attest: City Clerk 8 TELEPHONE 708/931-6100 Zifl FAX 708/931-5610 FOR HEARING IMPAIRED TDD 708/931-5616 CITY OF ELGIN 150 DEXTER COURT ELGIN, ILLINOIS 60120-5555 --;i-400,Tz; April _, 1993 Old Kent Bank 28 North Grove Avenue Elgin, Illinois 60120 Re: Loan Agreement, dated April _, 1993, Between Center City Development Corporation as Borrower, Old Kent Bank, N.A. , as Lender, and the City of Elgin as Guarantor Gentlemen: Please be advised that I am the Corporation Counsel for the City of Elgin, Kane and Cook Counties, Illinois (hereinafter referred to as the "City" ) , and as such Corporation Counsel, I have considered, examined and reviewed all documents, information, materials, matters, records and proceedings necessary for the issue of this opinion. In that connection, I have examined the Guaranty. In addition, I have examined the originals, or copies certified to my satisfaction of such other city records as I have deemed necessary as a basis for the opinions expressed below. In my examination of the documents referred to above, I have assumed the authenticity of all such documents submitted. I have assumed the execution and delivery, pursuant to due authorization, of each of the documents reviewed in this matter. Based upon my review and investigation as I have deemed appropriate, I am of the following opinion: 1 . That it is my opinion that the City of Elgin is a municipal corporation and a home rule unit organized and existing under the laws of the State of Illinois . 1 - Exhibit "C" ED Printed on recycled paper Old Kent Bank April , 1993 Page 2 2 . That it is my opinion that the resolutions adopted by the City Council of the City of Elgin on February 10, 1993, and March 31, 1993, authorizing execution of an agreement for commercial development with the Center City Development Corporation and authorizing execution of amendments to said agreement are in full force and effect, have not been revoked or rescinded and were adopted by the City under its home rule powers as an exercise of functions pertaining to its government and affairs and in strict compliance with the proceedings, rules and regulations of the City Council . 3 . That it is my opinion that the execution, delivery and performance by the City as Guarantor of the Guaranty is a proper exercise of its home rule powers to perform any function pertaining to its government and affairs . The resolution adopted by the City Council of the City of Elgin on March 31, 1993, providing for and authorizing execution and delivery of the subject guaranty is now in full force and effect and has not been amended, revoked or rescinded and was adopted by the City Council in strict compliance with all proceedings, rules and regulations of the City Council . No additional authorizations or approval are required for the due execution and delivery by the City as Guarantor of the Guaranty except as already have been duly obtained. 4 . I am of the opinion that the subject Guaranty constitutes a legal, valid and binding obligation of the City of Elgin as Guarantor and is enforceable against the City as Guarantor in accordance with the terms contained in said Guaranty, except that the enforceability thereof may be subject to (a) the exercise of judicial discretion in accordance with general principals of equity, and (b) bankruptcy, insolvency, reorganization, moratorium, and other similar laws affecting creditors rights generally. This opinion letter is rendered only to you and is solely for your benefit in connection with the above-described transactions . This opinion letter may not be relied upon by you for any other purpose or relied upon by any other person, firm, corporation or entity for any purpose without my prior written consent. Very truly yours, Erwin W. Jentsch Corporation Counsel City of Elgin EWJ/mg