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HomeMy WebLinkAboutResolutions - R-80-18 - 12/01/1980 - Bond for Margosian property RESOLUTION NO. R-80-18 A RESOLUTION AUTHORIZING THE EXECUTION OF A MEMORANDUM OF AGREEMENT BY AND AMONG THE CITY OF McHENRY , ILLINOIS AND WESTERN NATIONAL BANK OF CICERO, AS TRUSTEE UNDER TRUSTS NO. 6902 AND/OR 7816 , REGARDING THE ISSUANCE OF INDUSTRIAL DEVELOPMENT REVENUE BONDS WHEREAS, the City of McHenry , Illinois (the "City") , is an in- corporated municipality authorized and empowered by the provisions of the Industrial Project Revenue Bond Act, Sections 11-74-1 through 11-74-13 , inclusive,. of Chapter 24 , Illinois Revised Statutes , 1979 , as amended (the "Act") , to issue industrial development revenue bonds for the purpose of financing, in whole or in part, the cost of the acquisition, construction, reconstruction, improvement, betterment or extension of any industrial project (as defined in the Act) ; and WHEREAS, to relieve conditions of unemployment or to maintain existing levels of employment, to encourage the increase of industry and commerce within the State of Illinois and the City , thereby reduc- ing the evils attendant upon unemployment, and to increase the tax base of the City, the City proposes to issue one or more issues of industrial development revenue bonds pursuant to the Act to finance the cost of certain land, buildings, equipment and other facilities (the "Project") consisting of a shopping center located within the City at the northeast corner of Industrial Drive and Route 120 , consisting of approximately six (6) acres of land and improvements containing approximately 66 ,500 square feet of rentable space, and to be owned by Western National Bank of Cicero, as Trustee under Trusts No . 6902 and/or 7816, or its designee (the "Owner") ; and WHEREAS, Charles S . Margosian of 1715 Indian Knoll, Naperville, Illinois is the Owner of 100% of the beneficial interest in Western National Bank of Cicero, Trust No. 7816 and 50% of the beneficial interest in Trust No . 6902, and S . Louis Rathje of 203 East Liberty, Wheaton, Illinois is the Owner of the remaining 50% of the beneficial interest in said Trust No . 6902; and WHEREAS, it is deemed necessary and advisable for the industrial development, welfare and prosperity of the City and its inhabitants that the Project be undertaken at the earliest practicable date, and the Owner has requested satisfactory assurances from the City that the proceeds of the sale of one or more issues of industrial development revenue bonds of the City in an aggregate amount sufficient to finance the project, currently estimated at not to exceed $5,000, 000, will be made available; and WHEREAS, the City deems it necessary and advisable that it take such actions as may be required under the Act as then in effect to auth- orize and issue one or more issues of the Industrial development revenue bonds to finance the cost of the Project; and WHEREAS, a form of agreement, designated as a "Memorandum of Agreement", has been prepared under which the Owner has stated its willingness to arrange for the acquisition, construction and improvement of the Project and to enter into contracts therefor, and, at the time of delivery of the bonds, to agree to complete the acquisition, construction and improve- ment of the Project, and to enter into a loan agreement or loan agreements with the City with respect to the Project under which the Owner will be obligated (directly or through its bonds, notes , debentures or other obligations executed and delivered to evidence or secure its obligations thereunder) to make payments sufficient to pay the principal of, interest and redemption premium, if any, on the bonds as and when the same shall become due and payable, and such loan agreement or loan agreements shall contain such other provisions as may be required by the Act as then in effect and such other provisions as shall be mutually acceptable to the City and the Owner; NOW, THEREFORE, Be It Resolved by the City Council of the City of McHenry, Illinois, as follows: Section 1: That in order to insure the acquisition, construction and improvement of the Project in the City, with the resulting public benefits which will flow therefrom, it is deemed necessary and advisable that industrial development revenue bonds be issued in an amount sufficient to finance the Project, currently estimated at not to exceed $5,000,000, and that the Memorandum of Agreement hereinafter referred to be approved and executed for and on behalf of the City. Section 2: That the Memorandum of Agreement by and among the Owner and the City, substantially in the form and with the contents set forth in Exhibit A attached hereto, be and the same is hereby approved and authorized. Section 3: That the Mayor of this City is hereby authorized and directed to execute, and the City Clerk is hereby authorized to attest and to affix the seal of the City to, the Memorandum of Agreement substantially in the form and with the contents set forth in Exhibit A attached hereto or with such changes therein as shall be approved by the officers executing the same. Section 4 : That the City will issue and sell economic development revenue bonds in an amount sufficient to finance the costs of the Project, subject to the execution of the Memorandum of Agreement herein authorized and further subject to the condi- tions therein specified. -2- • Section 5 : That all resolutions and parts thereof in conflict herewith are hereby repealed to the extent of such conflict. PASSED AND APPROVED THIS 1st DAY OF December , 1980 AYES: Nolan, Pepping, Datz , Harker, Adams, Wieser, Schooley, Meurer NAYS: None ABSENT: None Mayor ATTEST: City Clerk The foregoing Resolution was voted upon and passed by the City Council of the City of McHenry, Illinois at a (regular) (apec1a±) meeting of the City Council duly called and held on the istday of December , 1980. The foregoing Resolution was aproved by the Mayor of the City of McHenry, Illinois on the 1st day of December , 1980. City Clerk -3- • • EXHIBIT A MEMORANDUM OF AGREEMENT THIS MEMORANDUM OF AGREEMENT is among the City of McHenry, Illinois (hereinafter referred to as the "City") , and Western National Bank, as Trustee under Trusts No. 6902 and 7816 (the "Owner" ) ; 1. Preliminary Statement . Among the matters of mutual inducement which have resulted in the execution of this agreement are the following: (a) The City is an incorporated municipality authorized and empowered by the provisions of the Industrial Project Revenue Bond Act, Sections 11-74-1 through 11-74-13, inclusive, of Chapter 24, Illinois Revised Statutes , 1979, as amended (the "Act") , to issue industrial development revenue bonds for the purpose of financing, in whole or in part, the cost of acquisition, construction, reconstruction, improvement, betterment and extension of any industrial project (as defined in the Act) . (b) So as to accomplish the purposes of the Act, the City proposes to issue one or more issues of industrial development revenue bonds pursuant to the provisions of the Act, to finance the cost of the acquisition, construction and improvement of certain land, buildings, equipment and other facilities (the "Project") to be located within the territorial boundaries of the City for use by the Owner as a shopping center and to enter into a loan agreement with the Owner with respect to the Project pursuant to the provisions of the Act as then in effect. (c) The Project, when completed and fully operational, should provide employment for approximately 200 persons . (d) It is deemed necessary and advisable, to accom- plish the purposes of the Act, that the Project be undertaken at the earliest practicable date, and the Owner has requested satisfactory assurances from the City that the proceeds of the sale of one or more issues of economic development revenue bonds of the City in an aggregate amount sufficient to finance the Project will be made available. (e) Representatives of the City have indicated the willingness of the City to proceed with and effect such financing in order to assist in the acquisition, construction and improve- ment of the Project in the City and have advised the Owner that, subject to due compliance with all requirements of law and the obtaining of all necessary consents and approvals and to the happening of all acts, conditions and things required precedent to such financing, the City by virtue of such statutory authority as may now or hereafter be conferred, will issue and sell one or more issues of its industrial development revenue bonds in an aggregate amount sufficient to pay the costs of the Project, currently estimated at not to exceed $5, 000,000 . (f) The City considers that the acquisition, construction and improvement of the Project and the entering into a loan agreement or agreements with the Owner with respect to the Project will relieve conditions of unemployment, or maintain existing levels of employment, encourage the increase of industry and commerce in the State of Illinois and in the City, increase the tax base of the City, and add to the wel- fare and prosperity of the City and that of its inhabitants . (g) The industrial development revenue bonds of the City shall be limited obligations payable solely out of the income and revenues derived by the City with respect to the Project. No holder of any such bonds shall have the right to compel any exercise of the taxing power of the City or any political subdivision of the State of Illinois to pay such bonds or the interest thereon and such bonds shall not constitute an indebtedness of the City or a loan of credit thereof. (h) Charles S . Margosian of 1715 Indian Knoll, Naperville, Illinois is the owner of 100% of the beneficial interest in the afore- said Trust No. 7816; the aforesaid Charles S . Margosian and S . Louis Rathje of 203 East Liberty, Wheaton, Illinois each, respectively, own 50% of the beneficial interest in the aforesaid Trust No . 6902. 2. Undertakings on the Part of the City . Subject to the condi- tions above stated, the City agrees as follows : (a) That it will authorize, or cause to be authorized the issuance and sale of one or more issues of its economic development revenue bonds, pursuant to the terms of the Act as then in effect, in an aggregate principal amount sufficient to pay the costs of the Project and currently estimated at not to exceed $5, 000 ,000 . (b) That it will adopt, or cause to be adopted, such proceed- ings and authorize and direct the execution of such docu- ments and take, or cause to be taken such actions as may be necessary or advisable to effect the authorization, issuance and sale of the bonds and the acquisition, construction and improvements of the Project, as aforesaid, and the entering into a loan agreement or agreements with the Owner with respect to the Project, or any combination thereof, all as shall be authorized by the Act as then in effect and mutually satis- factory to the City and the Owner. (c) That the aggregate payments to be used to pay the prin- cipal of, and interest and premium, if any, on the bonds payable under a loan agreement or agreements with the Owner (directly or through its bonds , notes, debentures or other obligations executed and delivered to evidence or secure its obligations thereunder) , shall be such sums as shall be sufficient to pay the principal of and interest and redemp- tion premium, if any, on the bonds as and when the same shall become -2- due and payable, and any loan agreement or agreements shall contain such other provisions as shall be required by the Act and such other provisions as are mutually acceptable to the City and the Owner. (d) That it will take or cause to be taken such other acts and adopt such further proceedings as may be required to implement the aforesaid undertakings as it may deem appropriate in pursuant thereof. 3. Undertakings on the Part of the Owner. Subject to the conditions above stated, the Owner agrees as follows: (a) That it will use all reasonable efforts to find one or more purchasers for the bonds . If the Owner does not find purchasers for said bonds, the City shall in no way be liable in damages, or otherwise, to any party whatsoever for such failure of consumation of financing. (b) That the Owner will enter into a contract or contracts for the acquisition, construction and improvement of the Project, and, at the time of the delivery of the bonds, agree to complete the acqui- sition, construction and improvement of the project. (c) That contemporaneously with the delivery of the bonds the Owner will enter into a loan agreement or agreements with the City under the terms of which the Owner will be obligated to pay (directly or through its bonds , notes, debentures or other obligations executed and delivered to evidence or secure its obligations thereunder) sums sufficient in the aggregate to pay the principal of an interest and redemption premium, if any, on the bonds as and when the same shall become due and payable; any such agreement to contain such other provi- sions as shall be required by the Act and such other provisions as are mutually acceptable to the City and the Owner. (d) That it will take such further action and adopt such further proceedings as may be required to implement its aforesaid undertakings or as it may deem appropriate in pursuance thereof. 4 . General Provisions . (a) All commitments of the City under paragraph 2 hereof and of the Owner under paragraph 3 hereof are subject to the conditions that on or before one year from the date hereof (or such other later date as shall be mutually satisfactory to the City and the Owner) , (i) the City and the Owner shall have agreed to mutually acceptable terms for the bonds and of the sale and delivery thereof, and mutually accept- able terms and conditions of the agreements referred to in paragraph 3 , (ii) the proceedings referred to in paragraphs 2 and 3 hereof shall have been taken, and (iii) all regulatory or other governmental approvals requisite to the execution of such documents and the issuance and sale of the bonds shall have been obtained. -3- • (b) Owner will pay the City for any and all professional fees, City Council salaries and other City expenses directly or indirectly incurred by, or charged to, the City in connection with the subject matter of the proposed bonds . Owner will immediately deposit with the City Clerk the sum of $4 ,000 .00 to be used by the City toward defraying such expenses and fees . At any time that pay- ments from said fund by the City have reduced the balance therein to less than $1, 500 . 00, Owner shall, upon request from the City Clerk, deposit such additional sum as will restore the fund balance to the sum originally deposited. Within 90 days after the closing of the sale of said bonds , any unobligated balance remaining in said fund shall be repaid to the Owner or assigns . IN WITNESS WHEREOF, the parties hereto have entered into this Agreement by their officers thereunto duly authorized as of the 1st day of December , 1980 . CITY OF McHENRY, ILLINOIS By Mayor (SEAL) ATTEST: City Clerk WESTERN NATIONAL BANK, AS TRUSTEE UNDER TRUSTS NO. 6902 AND 7816 By Its: Vice President (SEAL) ATTEST: -4-