HomeMy WebLinkAboutResolutions - 1999.09.09 - 25901September 9, 1999
MISCELLANEOUS RESOLUTION #9923I
BY: PLANNING AND BUILDING COMMITTEE, CHARLES E. PALMER, CHAIRPERSON
IN RE: PLANNING AND ECONOMIC DEVELOPMENT SERVICES DIVISION RESOLUTION
APPROVING PROJECT PLAN (OPENINGS PROJECT) - CITY OF PONTIAC
To Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
WHEREAS The Economic Development Corporation of the County of Oakland
(the "EDC") has recommended that the Board of Commissioners approve the
Project Plan required by the Economic Development Corporations Act (the "Act")
for the captioned Project, a copy of which has been presented to this meeting
(the "Project Plan"); and
WHEREAS the EDC's recommendations to the Board of Commissioners were
based upon its determinations that the Project is reasonable and necessary to
effectuate the purposes of the Act and that the Project Plan satisfies all of
the requirements of the Act regarding project plans; and
WHEREAS the governing body of the City of Pontiac, Oakland County,
Michigan, has also approved the Project Plan and given its consent to the
exercise of jurisdiction over the Project by the EDC; and
WHEREAS the Board of Commissioners has held a public hearing to consider
whether the Project Plan constitutes a public purpose as contemplated by the
Act; and
WHEREAS the Board of Commissioners, following such public hearing and
its review of the Project Plan, concurs in the determinations of the EDC with
respect thereto;
NOW THEREFORE BE IT RESOLVED that the Project Plan is hereby determined
to constitute a public purpose as contemplated by the Act and is hereby
approved; and
BE IT FURTHER RESOLVED that the EDC is hereby authorized to take such
steps as are necessary to implement the Project and the financing thereof by
the issuance of its limited obligation revenue bonds as contemplated by the
Project Plan; and
BE IT FURTHER RESOLVED that the County Clerk is hereby directed to
provide four certified copies of this resolution to the Assistant Secretary of
the Board of the EDC.
Chairperson, on behalf of the Planning and Building Committee, I move
the adoption of the foregoing resolution.
PiN1 NG AND BUILDING COMMITTEE
Planning_and Building_Committee Vote:
Motion carried unanimously on a roll call vote with Colasanti and Gregory absent.
nu ECONOMIC DEVELOPMENT CORPORATION
OF THE COUNTY OF OAKLAND
Oakland County, Michigan
Openings Project
PROJECT PLAN
CONTENTS
1. Summary Description of Project (Page I)
2. Project Plan Certification by Company (Page 2)
3. Statutorily Required Information (Page 3)
4. Exhibits
"A" - Project Area Legal Description
"B" - Letter of Credit or Bond Purchaser's Commitment Letter
"C" - Company Certificate Regarding Transfer of Employment
- Company Certificate Regarding Payment of Prevailing Wages
Other
PROJECT PLAN
OWNER OF PROJECT:
CONTACT PERSON:
SUMMARY DESCRIPTION OF
OPENINGS PROJECT
Openings, a Michigan limited partnership ("Openings")
Leon Yulkowslci
Openings
40 W. Howard
Pontiac, MI 48342
(248/335-7380)
LOCATION OF PROJECT: Pontiac, MI
PROJECT AREA/DISTRICT AREA: See Exhibit A
NATURE OF PROJECT: The project consists of the acquisition of an existing 136,000
square foot manufacturing facility, the rehabilitation of that
building, and the installation of certain machinery and
equipment for use in operating the facility (the "Project).
EMPLOYMENT CREATED OR RETAINED: Employment Retained: 60
Employment Created: 40
TOTAL PROJECT COST:
BONDS TO BE ISSUED:
$4,250,000
$3,600,000
LETTER OF CREDIT ISSUER OR BOND PURCHASER: Citizens Bank
DATE AND EXPIRATION DATE OF LETTER OF CREDIT OR BOND PURCHASE
COMMITMENT: Letter of Credit Commitment is dated , 1999 and expires
, 1999.
13y: OPEIV\\GS , INC, a Michigan corporation
It3: Genetlai Partner
By: Leon
Its: Ere
LD
PROJECT PLAN CERTIFICATION
THIS PROJECT PLAN WAS PREPARED FOR THE ECONOMIC
DEVELOPMENT CORPORATION OF THE COUNTY OF
OAKLAND IN ACCORDANCE WITH ME REQUIREMENTS OF
THE ECONOMIC DEVELOPMENT CORPORATIONS ACT, ACT
NO. 338 OF THE MICHIGAN PUBLIC ACTS OF 1974, AS
AMENDED.
THE UNDERSIGNED HAS PROVIDED ALL OF THE
INFORMATION CONTAINED HEREIN AND HEREBY
CERIIPIES AS TO THE ACCURACY AND VALIDITY OF SUCH
INFORMATION AS OF THIS DATE.
THE UNDERSIGNED UNDERSTANDS THAT ITILS PROJECT
PLAN IS STATUTORILY REQUIRED AND, IF IT CONT.A1NS
ANY MATERIAL MISREPRESENTATION OR INACCURACY,
COULD RESULT IN THE INVALIDATION OF THE ECONOMIC
DEVELOPMENT CORPORATION PROCEEDINGS REGARDING
THE PROJECT TO WHICH THE PROJECT PLAN PERTAINS.
OPENINGS, a Michigan limited partnership
Dated: August 12_ 1999
2
PROJECT PLAN
STATUTORILY REQUIRED INFORMATION REGARDING
OPENINGS PROJECT
I. THE LOCATION AND EXTENT OF EXISTING STREETS AND OTHER
PUBLIC FACILIlltS WITHIN THE PROJECT DISTRICT AREA; THE LOCATION,
CHARACTER, AND EXTENT OF THE CATEGORIES OF PUBLIC AND PRIVATE LAND
USES NOW EXISTING AND PROPOSED FOR THE PROJECT AREA, INCLUDING
RESIDENTIAL, RECREATIONAL, COMMERCIAL, INDUSTRIAL, EDUCATIONAL, AND
OTHER USES; AND A LEGAL DESCRIPTION OF THE PROJECT AREA:
The Project includes the acquisition of an existing manufacturing facility, which will continue
to operate as a manufacturing facility, located at 79 W. Howard in the City of Pontiac.
Legal description of Project Area attached as Exhibit A.
II. A DESCRIPTION OF EXISTING IMPROVEMENTS IN THE PROJECT AREA
TO BE DEMOLISHED, REPAIRED, OR ALTERED; A DESCRIPTION OF REPAIRS AND
ALTERATIONS; AND AN ESTIMATE OF THE TIME REQUIRED FOR COMPLETION:
Not Applicable
ILI. THE LOCATION, EXTENT, CHARACTER, AND ESTIMATED COST OF THE
IMPROVEMENTS, INCLUDING REHABILITATION CONTEMPLATED FOR THE PROJECT
AREA, AND AN ESTIMATE OF THE TIME REQUIRED FOR COMPLETION:
Openings is a manufacturer of commercial door and hardware systems. The Project consists
of the acquisition of an existing 136,000 square foot manufacturing facility, the rehabilitation of that
building, and the installation of certain machinery and equipment for use in operating the facility.
It is expected that it will cost approximately $3,000,000 to acquire the building and $575,000
to rehabilitate it. Rehabilitation will include updating the plumbing, repairing the roof, and upgrading
the HVAC system. $550,000 has been budgeted for machinery and equipment. Approximately
$125,000 will be spent to cover costs associated with issuing the bonds. The Project will start in
October, 1999 and rehabilitation is expected to be completed by April, 2000.
(See also IV for more detail)
3
IV. A DESCRIPTION OF THE CONSTRUCTION OR STAGES OF CONSTRUCTION
PLANNED, AND THE ESTIMATED TIME OF COMPLETION OF EACH STAGE:
Acquire existing facility: October, 1999
Begin rehabilitation: October, 1999
Begin operations: December, 1999
Complete rehabilitation: April, 2000
Machinery and equipment will be installed over time after completion of rehabilitation.
(See also III)
V. A DESCRIPTION OF THE PARTS OF THE PROJECT AREA TO BE LEFT AS
OPEN SPACE AND THE USE CONTEMPLATED FOR THE SPACE:
Green areas that surround the building as it presently exists will remain. There is no other
intended use for the open space.
VI. A DESCRIPTION OF PORTIONS OF THE PROJECT AREA WHICH THE
ECONOMIC DEVELOPMENT CORPORATION OR THE COMPANY DESIRES TO SF.T.L,
DONATE, EXCHANGE OR LEASE TO OR FROM THE MUNICIPALITY AND THE
PROPOSED TERMS:
Not Applicable
VII. A DESCRIPTION OF DESIRED ZONING CHANGES AND CHANGES IN
STREET, STREET LEVELS, INTERSECTIONS AND 'UTILITIES:
None
VIII A DESCRIPTION OF THE PROPOSED METHOD OF FINANCING THE
PROJECT, INCLUDING ATTACHMENT OF A COPY OF THE LETTER OF CREDIT OR
BOND PURCHASER'S COMMITMENT LE TTER:
The Project is anticipated to be financed with tax-exempt bonds issued by the Economic
Development Cotporation of the County of Oakland and secured by a Citizens Bank direct pay letter
of credit.
Copy of Letter of Credit commitment attached as Exhibit B.
4
IX. A STATEMENT REGARDING THE PAYMENT OF PREVAILING WAGE AND
FRINGE BENEFIT RATES AS DETERMINED PURSUANT TO ACT NO. 166 OF THE
MICHIGAN PUBLIC ACTS OF 1965, AS AMENDED (REGARDING WAGES ON STATE
CONTRACTS):
Company certificate regarding payment of prevailing wages attached as Exhibit D
X. A LIST OF PERSONS WHO WILL MANAGE OR BE ASSOCIATED WITH THE
MANAGEMENT OF THE PROJECT FOR A PERIOD OF NOT LESS THAN I (ONE) YEAR
FROM THE DATE OF APPROVAL OF THE PROJECT PLAN:
Leon Yulkowski, President of Openings, Inc., the General Partner of Openings
XI. DESIGNATION OF THE PERSON OR PERSONS, NATURAL OR CORPORATE,
TO WHOM THE PROJECT IS TO BE LEASED, SOLD OR CONVEYED AND FOR WHOSE
BENEFIT THE PROJECT IS BEING UNDERTAKEN, TO THE EXTENT THAT
INFORMATION IS PRESENTLY AVAILABLE:
The Project is being undertaken for the benefit of Openings, which will own all assets
acquired as part of the Project.
XII. IF THERE IS NOT AN EXPRESS OR IMPLIED AGREEMENT WITH A PERSON
OR PERSONS, NATURAL OR CORPORATE, THAT THE PROJECT WILL BE LEASED,
SOLD, OR CONVEYED TO THOSE PERSONS, THE PROCEDURES FORBIDDING FOR THE
LEASING, PURCHASING OR CONVEYING OF THE PROJECT UPON ITS COMPLETION:
Not Applicable
XIII. ESTIMATES OF THE NUMBER OF PERSONS RESIDING IN THE PROJECT
AREA AND THE NUMBER OF FAMILIES AND INDIVIDUALS TO BE DISPLACED. IF
OCCUPIED RESIDENCES ARE DESIGNATED FOR ACQUISITION AND CLEARANCE,
INCLUDE A SURVEY OF THE FAMILIES AND INDIVIDUALS TO BE DISPLACED,
INCLUDING THEIR INCOME AND RACIAL COMPOSITION, A STATISTICAL
DESCRIPTION OF THE HOUSING SUPPLY IN THE COMMUNITY, INCLUDING THE
NUMBER OF PRIVATE AND PUBLIC UNITS IN EXISTENCE OR UNDER CONSTRUCTION,
ME CONDITION OF THOSE IN EXISTENCE, THE NUMBER OF OWNER-OCCUPIED AND
RENTER-OCCUPIED UNITS, THE ANNUAL RATE OF TURNOVER OF THE VARIOUS
TYPES OF HOUSING AND THE RANGE OF RENTS AND SALE PRICES, AN ESTIMATE OF
THE TOTAL DEMAND FOR HOUSING IN THE COMMUNITY, AND THE ESTIMATED
5
CAPACITY OF PRIVATE AND PUBLIC HOUSING AVAILABLE TO DISPLACED FAMILIES
AND INDIVIDUALS:
Not Applicable
XIV. A PLAN FOR ESTABLISHING PRIORITY FOR THE RELOCATION OF
PERSONS DISPLACED BY THE PROJECT IN NEW HOUSING IN THE PROJECT AREA:
Not Applicable
XV. PROVISION FOR THE COSTS OF RELOCATING PERSONS DISPLACED BY
THE PROJECT AND FINANCIAL ASSISTANCE AND REIMBURSEMENT OF EXPENSES,
INCLUDING LITIGATION EXPENSES AND EXPENSES INCIDENT TO THE TRANSFER OF
TITLE, IN ACCORDANCE WITH THE STANDARDS AND PROVISIONS OF THE FEDERAL
UNIFORM RELOCATION ASSISTANCE AND REAL PROPERTY ACQUISITION POLICIES
ACT OF 1970, 42 U.S.C. 4601 TO 4655:
Not Applicable
XVI. A PLAN FOR COMPLIANCE WITH ACT NO. 227 OF THE MICHIGAN PUBLIC
ACTS OF 1972, WHICH PERTAINS TO PROVIDING FINANCIAL ASSISTANCE, ADVISORY
SERVICES AND REIMBURSEMENT OF CERTAIN EXPENSES TO DISPLACED PERSONS:
Not Applicable
XVII. OTHER MATERIAL AS THE ECONOMIC DEVELOPMENT CORPORATION,
LOCAL PUBLIC AGENCY, OR GOVERNING BODY CONSIDERS PERTINENT:
Not Applicable
6
Exhibit 'A
The land referred to in this cornmitmentliAsexis situated in the State of Michigan
and is described as follows:
• County of Oakland
City of Pontiac . • .
Parcel A
Lott A Assessor's Plat No. 33, a subdivision as recorded in liber
1-A, page 33 of plats, Oakland County Records, and Lots.1, 2. 3, 9.
and 10, and part of Lots 4, 5, 6, 7, 8, 11, 12, 17, 18 and 19,
including part of vacated Grove Street (60 feet wide) and part of
vacated alley (20 feet wide) all being part of the Map of Sanderson &
Johnston's Addition to the City of Pontiac, a subdivision as recorded
in liber 1, page 33 of plats, Oakland County Records, and being more
particularly described as follows: Beginning at the southeast
corner of Baldwin Avenue (width varies) and Howard Street (recorded
60 feet wide), said point being 'also the northwest corner of Lot 4
of said Assessor's Plat No. 33 (liber 1-A, page 33 of plats, Oakland
County Records); proceeding thence from said point of beginning
south 89 degrees 44 minutes 37 seconds east along the south line of
said Howard Street, said line being also the north line of said
Lot 4, a.distance of 617:25 feet to the northeast corner of said
lot; thence south 22 degrees 32 minutes 06 seconds west along the
westerlylline of the Grand Trunk Western Railroad Right-of-way (50
feet wide), said line being also the Easterly line of said Lot 4
and its southerly extension into said Map of Sanderson & Johnston's
Addition to the City of Pontiac, (liber 1, page 33 of plats, Oakland
County Records), a measured distance of 577.38 feet to a point in
the interior of Lot 19 of said Map of Sanderson & Johnston's Addition
to the City of Pontiac; thence north 67 degrees 32 minutes 14
seconds west, a distance of 428.51 feet to a point on the east line
of said Baldwin Avenue, said point being north 00 degrees 00 minutes
19 seconds east, 289.59 feet as measured along the east line of said
Baldwin Avenue from the northeast corner of Oakland Avenue (width
varies) and said Baldwin Avenue; thence north 00 degrees 00 minutes
19 seconds east along the east line of said Baldwin Avenue, said
line being also part of the west line of Lot 4, all of the west line
of Lots 3, 2 and 1 of said Map of Sanderson & Johnston's Addition
to the City of Pontiac, and the west line of Lot 4 of said Assessor's
Plat no. 33, a measured distance of 372.33 feet to the point of
beginning.
and
Parcel B
Lots 1 through R_inclusive, Bloele 3., Map of Stockwell & Tregent's
Addition cL, Lue City of Pontiac, a subdivision as recorded in
liber 4, page 9 of plats, Oakland County Records; part of Lot 7,
Assessor's Plat No. 32, as recorded in liber 1A, page 32 of plats,
Oakland County Records, Part of Lots 6, 15, 16 and 17, including
CONTINUED, NEXT PAGE
Exhibit B
LETTER OF CREDIT OR
BOND PURCHASER'S COMMITMENT LETTER
[to be provided at the meeting]
ict
CONTINUATION OF LEGAL DESCRIPTION:
vacated alleys of the Map of Sanderson & Johnston's Addition to
the City of Pontiac, as recorded in liber 1, page 33 of plats,
Oakland County Records, and being more particularly described
as follows: beginning at the southwest corner.of Howard Street
(recorded 60 feet wide) and Stockwell Street (50 feet wide at this
point), said point being also the northeast corner of Lot 6,
Block 3 of said Map of Stockwell & Tregent's Addition to the City
of Pontiac, (liber 4, page 9 of plats, Oakland County Records);
proceeding thence from said point of beginning south 00 degrees
10 minutes 08 seconds west, along the west line of said Stockwell.
Street, said line being .also the east line of Lots 6 through 1,
inclusive, Block 3, Map of Stockwell & Tregent's Addition, a
measured distance of 374.32 feet (recorded 374.00 feet) to the
southeast' corner of said Lot 1; thence south 88 degrees 45 minutes
52 seconds east along part of the north line of Lot 7 of said
Assessor's Plat No. 32, (lib9r 1-A, page 32 of plats, Oakland County
_ Records), a distance of 10.00 feet to the northeast corner of
said Lot 7; thence south 00 degrees 10 minutes 08 seconds west
along the west line of Stockwell Street (40 feet wide at this
point), said line being also part of the east line of said Lot 7,
a distance of 57.52 feet to a point; thence south 80 degrees
23 minutes 12 seconds west, through the interior of said lot 7
and into the interior of said Map of Sanderson •& Johnston's
Addition to the City of Pontiac, (liber 1, page 33 of plats, Oakland
•County Records), a distance of 351.91 feet to a point on the
easterly line of the. Grand Trunk Western Railroad right-of-way
(50 feet wide); thence north 22 degrees 32 minutes 06 seconds east
along the easterly line of said railroad right-of-way, a distance
of 531.84 feet to the point of intersection of said right-of-way
line with the south line of said Howard Street, said point being
also the northwesterly corner of Lot 8, Block 3 of said Map of
Stockwell & Tregent's Addition; thence south 89 degrees 49 minutes
30 seconds east along the south line of said Howard Street, said
line being also the north.line of said Lots 8, 7 and 6, Block 3,
of said Map of Stockwell & Tregent's Addition, a measured distance
of 134.42 feet (recorded 134.00 feet) to the point of beginning.
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By OPENINGS, INC,, a Michigan corporation
Its:Geneaalyartner r,, ,
, -Leon niikowski
Its: ( President
Exhibit C
COMPANY CERTIFICATE REGARDING
TRANSFER OF EMPLOYMENT
(Openings Project)
The undersigned, Openings, a Michigan limited partnership (the "Company"), hereby certifies
to The Economic Development Corporation of the County of Oaldand (the "EDC") as follows:
1. This Certificate is made and based upon the best of the Company's knowledge and
belief, only after thorough investigation and discussion with all owners of the Company and others
who might have knowledge regarding the subject matter.
2. The Company acknowledges that this Certificate will be employed by the EDC as the
sole basis for the EDC's certification to the Board of Commissioners of the County of Oakland as to
transfer of cmpIoyment as required by Section 8(3) of the Economic Development Corporations Act,
Act No 338 of the Michigan Public Acts of 1974, as amended (the "Ad").
3. The Company understands that the EDC's Certification to the Board of
Commissioners of the County of Oakland is a statutory requirement which, if improperly made or
based upon any material misrepresentation or inaccuracy, might invalidate the proceedings regarding
the Openings Project (the "Project") pursuant to which the EDC expects ultimately to issue its limited
obligation economic development revenue bonds to finance all or part of the Project.
4. As of the date hereo4 the Project will not have the effect of transferring employment
of more than 20 full-time persons from a municipality (as that term is defined in the Act) of this State
to the City of Pontiac, Michigan, the municipality in which the Project will be located.
OPENINGS, a Michigan limited partnership
Dated: August 12, 1999
C-1
By OPENS, INC., a Michigan corporation
Its: Gen
wski
President
Exhibit D
COMPANY CERTIFICATE REGARDING
PAYMENT OF PREVAILING WAGES
(Openings Project)
The undersigned, Openings, a Michigan limited partnership (the "Company"), hereby certifies
to The Economic Development Corporation of the County of Oakland (the "EDC') as follows:
1. The Company understands that this Certificate is a statutory requirement under the
Economic Development Corporations Act, Act No. 338 of the Michigan Public Acts of 1974, as
amended (the "Act") which, if improperly made or based upon any material misrepresentation or
inaccuracy, might invalidate the proceedings regarding the Openings Project (the "Project") pursuant
to which the EDC expects ultimately to issue its limited obligation economic development revenue
bonds to finance all or part of the Project.
2. Within the meaning and intent of Section 8(4)(h) of the Act, all persons performing
work on the construction of the Project will be paid the prevailing wage and fringe benefit rates for
Vle same or similar work in the locality in which the work is to be performed, as determined pursuant
f0 Act No, 166 of the Michigan Public Acts of 1965, as amended.
OPENINGS, a Michigan limited partnership
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Commercial Mortgage Commitment
•
August 17, 1999
Mr. Leon Yulkowski
Openings
40 W. Howard
Pontiac, MI 48342
Dear Mr. Yulkowski:
We are pleased to confirm that Citizens Bank has approved the issuance of an Irrevocable
direct-pay letter of credit (LOC) as credit enhancement for financing received from an
Oakland County Industrial Revenue Bond.
This letter is the Bank's offer to commit to issue the LOC, subject to terms and
conditions described herein, and documentation satisfactory in form and content to the
Bank_
LOAN FACILITY #1
BORROWER: Openings
AMOUNT: $3,600,000.00
BOND TERM AND AMORTIZATION
The letter of credit will have an expiration of five years, renewable thereafter at the
option of the Bank
UNDERWRITER/PLACEMENT AGENT
W. Y. Campbell & Company
USE OF PROCEEDS
Establish a letter of credit to back an Oakland County Industrial R.evenue Bond, which in
turn will be used to finance the purchase on land and building located at 79 W. Howard
St., Pontiac, MI, lcasehold improvements to this property and equipment purchases, in
accordance with information previously furnished to the Bank.
<177
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I 119--IIFFTTI 486-HTMWTRI
COLLATERAL To secure the repay ment of the 1.-oan and the performance or all nl
Borrower's obligations
co Citizens. Citizens is to be granted:
First real estate mortgage on 79 W. Howard, Pontiac, MI, containing an assignment cf
Tents provision.
Second real estate mortgage or_ 40 W. Howard, Pontiac, MI containing an assignment of
rents provisinn.
FEES
The letter of credit will require a I% per annum fee, prepaid annually commencing with
the Bond closing and are non refundable. In addition, there will be a fee of $200,00 for
each draw upon the letter of credit, payable at the time of the draw.
ESCROW
Borrower will establish a depository account with Bank. Borrower will bc required to
make monthly deposits to that account to provide for the payments required under the
bond and for the annual latier of credit fee.
OTHER
Borrower, at the Bank's option, shall pay any increase in the Bank's cost of issuing or
maintaining the LOC, or any decrease in the Bank's fees or other compensation fol the
LOC, resulting from:
-Change in Law. Any change in law or regulation or interpretation thereof by any
court, administrative, banking or regulative body enacted or effective after the
date of this letter, or
-New Taxes or Other Charges. Any imposition of applicable reserves, special
deposits, risk/capital adequacy or similar requirements against later; of credit, or
any new charge or tax on banks with respect to letters of credit.
LOAN FACILITY #2
BORROWER: Openings
AMOUNT: $950,000.00
TERMS OF REPAYMENT: Five year note with payments based upon a ten year
amortization requiring monthiy payments or principal including interest
INTEREST RATE: The loan shall be priced at a fixed rate of 201 basis points over the
Inc year Treasury, fixed ai time fclosing. (The interest rate today would t..e 7.8P/).
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47-TP8 1:114-71:1 EL--2-11-315-11717-415-11
COLLATERAL
A first real estate mortgage on 40 W. Howard, Pontiac, MI containing an assignment of
rents provision
TERMS AND CONDITIONS APPLCABLE TO LOANS #1 AND #2:
GUARANTEES
The loans are to be guaranteed by Openings, LLC as to the payment of all indebtedness
and the performance of all obligations of Borrower to Citizens. The Guaranty shall be
secured by all assets of the LLC to be formed.
The loans will require the unsecured corporate guaranty of Openings, Inc.
TITLE INSURANCE
The mortgages to be insured as a good and valid first lien against the subject real estate_
Title insurance in the amount of Citizens' mortgage loan, naming Citizens Bank as the
insured party, shall be written by a company satisfactory to Citizens, and the Report of
Title shall be free of objectionable expenses, all objectionable encumbrances, e&serracnts
and restrictive covenants, and all violations of Fe.den4 State and Municipal laws and
regulations, and shall insure against unrecorded construction liens and matters that would
be disclosed by an accurate survey. A copy of all recorded exceptions to title shall be
furnished to Citizens prior to closing and shall be subject to approval by Citizens and its
legal counsel_
INSURANCE
Borrower will be required to provide Hazard Insurance in an amount equal to the full
replacement value of the subject property and the collateral, but in no event less than thc
amount of the first mortgage loan. The policy shall be provided by an insurance
company satisfactory to Citizens. Extended coverage endorsements are required.
Borrower will be required to provide a letter from an authorized agent stating that all
premiums are paid and that the policy is in full force and effect. Citi7ens
Bank is to be properly listed as first mortgagee in the standard mortgagee clause
of said policy. Borrower will also be required to provide Liability, and such other
insurance as may reasonably be required by Citizens in amounts and with companies
acceptable to Citizens and, as to liability Insurance, naming Citizens as a named insured.
In addition, all policies shall provide that Citizens be given thirty (30) days written notice
prior to any cancellation, termination or policy expiration.
SURVEY
A current mortgage survey of the subject property will be required. The survey is to be
made by a licensediregistere,...1 surveyor and shall be acceptable to Citizens, Citizens' legal
counsel and the title company. The survey shall include the following:
I. identification of the nr:rnises by legal description,
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T5/Z4/1,13 UN.0
•
2_ Location of the improvements.
3. Dimensions of the plot, lot lines, building, parking areas, streets and driveways.
4. Dimensions of easements and encroachments, if any. All easements and
encroachments shall he identified by volume and page number.
S. indication as to whether or not the subject property is in a flood/mudslide area, and if
so. the classification of said area.
6. Legal description on the survey and title policy are to be identical.
ZONING
The building and improvements offered as security must be in accordance with the
application zoning ordinance. If there is any deviation from or violation of the zoning
ordinance, then this Commitment shall be null and void. The improvements are to be in
accordance with all Federal, State and Local laws and regulations; including, but not
limited to: zoning, building, tire, water, environmental and sewerage requirements. Prior
to Closing, Bon-ower will be required to furnish a Certificate of Proper Zoning and a
Certificate of Occupancy in a form satisfactory to Citizens.
OTHER CONDITIONS
Prneision of acceptable appraisal, prior to closing.
Borrower shall provide a certified copy of its Articles of Partnership, including all
amendments thereto, and a certified copy of its Certificate cf Partnership, and all
amendments thereto, as filed with the appropriate governmental authority.
Loan amount not to exceed 75% of the lesser of cost or appraised value on a combined
basis of the real estate taken as collateral_
Furnishing to Citizens Bank a copy of the executed Purchase Agreement pertaining to the
purchase of the property located at 79 W. Howard SL, Pontiac, Mr.
Furnishing to Citizens annual reviewed financial statements of Borrower (and
Guarantor(s)).
Evidence of payment of all currently payable real and any personal property taxes and
assessments.
Satisfactory Loan Officer Site Inspection/Verification Checklist and Borrower's
Environmental Questionnaire or Phase I Environmental Assessment by Citizens Bank's
approved consultant. (See anached Environmental Addendum to Loan Commitment).
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Satisfactory legal opinion by Bank's legal counsel as to the validity and binding effect of
all Borrower and Guarantor documents.
Establish and maintain primary depository relationship of Borrower and Guarantor with
Citizens Bank.
COSTS
All costs incidental to and pertaining to the preparation for closing and the actual closing
of this loan, regardless of the nature of same, shall be borne by the Borrower. These
costs shall include, but not be limited to, such items as: title insurance, recording fees,
attorney's fee, appraisal fees, and cost of the survey. In the event the loan fails to close
through no fault of Citizens, Borrower agrees to pay all legal fees and other costs
incurred by Citizens.
ASSIGNMENT OF COMMITMENT
This Commitment cannot be assigned by Borrower without the prior written consent of
Citizens Bank.
RELIANCE
This Commitment is only binding on Citizens and Bo:Tower. No third parry shall be
entitled to rely on this Commitment in any manner whatsoever.
COMMITMENT EXPIRATION DATE
This commitment expires September 29, 1999, unless sooner terminated by the closing
and funding of the loan or extended in writing by Citizens. Citizens may, but shall not be
required to, grant written extensions, and shall be entitled to charge and collect additional
costs or fees for any extension.
REVOCATION
Citizens reserves the right to revoke this Commitment, upon written notice to the
Borrower, if any of the following events (as determined in the sole discretion of Citizens)
shall occur between the date hereof and the closing of the Loan; (1) any materially
adverse change in the financial condition or business prospects of the Borrower, (ii) any
materially adverse change in the character of value of the collateral to be granted Citizens
in connection with this Loan transaction, (iii) any materially adverse change in the
economic conditions in the industry in which the Borrower does business or in the
economy in general, (iv) breach of any conditions contained herein Of in the Loan
Agreement or other documents executed by Borrower, (v) discovery that any of the
representations made at any time by Borrower to Citizens were untrue at the time they
were made or ceased to be true at any time prior to the closing of the Loan.
0/24/99 TUE 09:01 [TX/RX NO 5929]
p5/C411,15 UM:I UL-2-415-17513 6.11/grjJANti LUNN Phi"
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Should the aforementioned terms and conditions be acceptable to you, please
acknowledge the same by signing the appropriate space provided and by returning an
'acknowledged" copy of this letter to me no later than September 10, 1999.
Sincerely,
Likt_datuA
Michelle M. Mullett
Vice President
Commercial Banking Division
The undersigned accept the foregoing commitment and all its terms, conditions and
requirements and agrees to cause the Loan to be made in accordance with all the terms,
conditions and requirements and within the time specified by this Commitment. This
Letter of Commitment is the entire agreement between the parties and cannot be changed
except in writing and signed by all parties.
BORROWER
Openings
By: _ Dated:
Leon Yulkowski, President of Openings, Inc., General Partner
08/24/99 TUE 09:01 [TX/RX NO 5929]
08/ D9: 0: U. 24&69164h4 DFF [IUE
ENVIRONMENTAL ADDENDUM
TO LOAN COMMITMENT
This Addendum is annexed to and incorporated by reference in a certain loan
commitment letter dated August 17, 1999, naming Citizens Bank as Lender and
Openings as Borrower.The additional terms and conditions set forth
below shall fully apply to that loan commitment letter and shall be regarded as
an integral part of that letter. Full compliance with all matters set forth below
shall be express conditions precedent to any obligation on the part of Lender to
provide the credit facility described in the loan commitment letter.
1. Environmental Questionnaire. Borrower shall provide Lender with a completed
PRE-LOAN ENVIRONMENTAL QUESTIONNAIRE, in the form previously
furnished by Lender, containing all requested information and certifications.
1 Environmental Investigation Authorization. To determine whether the Property
described as collateral in the annexed loan commitment poses an environmental
risk or has been contaminated by Hazardous Materials, Borrower authorizes
Lender, in Lender's sole and complete discretion, (a) to contact any person or
regulatory agency that Lender deems necessary or desirable; (b) to conduct, or
cause to be conducted by its designee, an inspection of the Property; (c) to take
any other action Lender deems necessary or desirable, such as requiring Borrower
to obtain the opinion of an environmental engineer satisfactory to Lender as to
whether the Property poses an environmental risk or has been contaminated by
Hazardous Materials. Borrower shall give Lender its full cooperation for this
environmental investigation, which cooperation shall include but shall not be
Limited to giving access to the Property to Lender or its designee for all
inspections and tests and providing Lender with, or giving Lender access to, all
documents Lender deems necessary for the environmental investigation.
Environmental Assessment. Lender expressly reserves the right to require a
formal environmental site assessment concerning the Property, to be conducted by
an environmental engineering and consulting firm which is satisfactory to Lender,
as a part of its environmental investigation. Should Lender, in its sole discretion,
determine a need for a formal site assessment, it shall so advise Borrower, and
Borrower shall confer with Lender and arrange for employment of a mutually
satisfactory environmental consultant within 30 days of Lender's determination.
If Lender and Borrower are unable to agree as to such employment or the proper
scope of the environmental site assessment, Lender may terminate this
commitmunt
08/24/99 TUE 09:01 fTX/RX NO 59291
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4. Cost of Environmental Investigation. Any and all costs, fees and expenses
incurred in connection with envireamental investigation of the Property, including
but not limited to outside consuftant fees and expenses, shall be thc sole
responsibility of Borrower:.
5. Purpose of Environmental Investigation. The environmental investigation
conducted by Lendcr is conducted solely for the benefit of Lender to protect its
interests as Lender_ The investigation shall not be relied upon by Borrower for
any purpose. including but not limited to satis&ing Borrower's obligation, if any,
to conduct an independent environmental investigation of its own. By conducting
an envi7onrnenW investigation. Lender does not assume any obligation or liability
to Borrower, and Borrower shall not construe such an investigation as creating
any obligation or liability of Lender to Borrower,
6. Environmental Representations, Warranties, and Covenants. The documents
evidencing, securing, or executed as part of any loan made pursuant to this
eornmitsnent shall contain such representations, warranties, covenants and
Indemnities by the Borrower as to environmental matters and as to Borrower's
compliance with all Federal, state or local environmental laws, ordinances, rules
and regulations per.airg thereto, as Lender may deem appropriate in its sole and
complete discretion. Borrower's responses to questions in the environmental
questionnaire shall constitute representations by Borrower as to environmental
matters and shall be deemed to be part of the loan documents.
7. Termination of Commitment. In addition to any other reasons set forth in the loan
commitment letter or in this Addendum, Lender may terminate and revoke this
commitment without further obligation or liability to Borrower if, in its sole and
complete discretion. Lender concludes (on the basis of its environmental
investigation or informatioe obtained from any source whatsoever) that the
Property may pose an environmental risk or is (or may have been) contaminated
by Hazardous Materials_
8. Hazardous Materials. As used in this Addendum, Hazardous Materials means any
flammable explosives, radioactive materials, hazardous materials, hazardous
wastes, hazardous or toxic substances, or related materials described in the
Comptehenaive Environmental Response, Compensation and Liability Act of
1980. as amended (42 USC. 9601, et seq.), the Hazardous Materials
Transportation Act, as amended (49 USC 1801. et seq.), the Resource
Conservation and Recovery Act, as amended (42 USC 6901, et seq.), thereto, or
in any other federal, stare, or focal environmental law, ordinance, rule, or
regulation.
By signature of its duly authorize::: representatis:c below, Borrower acknowledges and
agrees that this Addendum i made a part of the annexed loan cumniitment letter.
08/24/99 TUE 09:01 1TX/RX NO 5929]
08/24/99 09:03 FAX 2488918464 CITIZENS BANK LOAN DEPT. Z010
• .
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ACKNOWLEDGED AND ACCEPTED
BORROWER
Openings
By:
Leon Yulkowski
Daied.
08/24/99 TUE 09:01 (TX/RX NO 5929]
THE FOF?EGOING RESOLUTION
Resolution #99231 September 9, 1999
Moved by Palmer supported by Causey-Mitchell the resolution be adopted.
AYES: McCulloch, McPherson, Melton, Millard, Moffitt, Obrecht, Palmer,
Patterson, Schmid, Sever, Suarez, Taub, Amos, Appel, Causey-Mitchell, Colasanti,
Coleman, Devine, Dingeldey, Douglas, Galloway, Garfield, Gregory, Jensen,
Law. (25)
NAYS: None. (0)
A sufficient majority having voted therefor, the resolution was adopted.
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
I, G. William Caddell, Clerk of the County of Oakland, do hereby certify that the
foregoing resolution is a true and accurate copy of a resolution adopted by the
Oakland County Board of Commissioners on September 9, 1999 with the original
record thereof now remaining in my office.
In Testimony Whereof, I have hereunto set my hand and affixed the seal of the
County of Oakland at Pontiac, Michigan this 9t1 day 9i September, 1999.
G. William Caddell, County Clerk