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HomeMy WebLinkAboutRESOLUTION - 33-02 - 7/23/2002 - MEMORANDUM OF UNDERSTANDINGRESOLUTION NO. 33-02 A RESOLUTION AUTHORIZING THE MAYOR AND VILLAGE CLERK TO EXECUTE THE JOINDER TO AND ASSUMPTION AND ACCEPTANCE OF MEMORANDUM OF UNDERSTANDING FOR PRE -DEVELOPMENT SERVICES FOR THE DEVELOPMENT OF THE SOUTH SUBURBAN AIRPORT NOW, THEREFORE, BE IT RESOLVED by the Mayor and Board of Trustees of the Village of Elk Grove Village, Counties of Cook and DuPage, State of Illinois as follows: Section I- That the Mayor be and is hereby authorized to sign the attached documents marked: JOINDER TO AND ASSUMPTION AND ACCEPTANCE OF MEMORANDUM OF UNDERSTANDING FOR PRE -DEVELOPMENT SERVICES FOR THE DEVELOPMENT OF THE SOUTH SUBURBAN AIRPORT a copy of which is attached hereto and made a part hereof as if fully set forth and the Village Clerk is authorized to attest said documents upon the signature of the Mayor of Elk Grove Village. .Section 2: That this Resolution shall be in full force and effect from and after its passage and approval according to law. VOTE: AYES: 6 NAYS: 0 ABSENT 0 PASSED this 23rd day of July, 2002. APPROVED this 23`d day of July, 2002. APPROVED: Craig B. Johnson, Mayor ATTEST: Ann I. Walsh, Village Clerk RRSairportjoinderi.doc JOINDER TO AND ASSUMPTION AND ACCEPTANCE OF MEMORANDUM OF UNDERSTANDING FOR PRE -DEVELOPMENT SERVICES FOR THE DEVELOPMENT OF THE SOUTH SUBURBAN AIRPORT WHEREAS, the Village of Bensenville, Illinois, as the initial Sponsor, and Hochtief AirPort and LCOR HOLDINGS LLC, as the Developers, entered into that certain Memorandum of Understanding dated as of July 7, 2002 (the "MOU") relating to pre -development services for the development, construction, and operation of a regional south suburban airport with passenger and cargo facilities (the "Project') to be located in the south suburban region of Chicago, Illinois; WHEREAS, Elk Grove Village, Illinois and the City of Park Ridge, Illinois ("Municipalities") desire to become parties to and join in the MOU as additional entities constituting the Sponsor, and thereafter become constituent members of the inter -governmental authority or other entity to be formed to own and sponsor the development of the Project; NOW THEREFORE, in consideration of the mutual covenants contained in the MOU and herein and for other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the Municipalities hereby agree as follows: 1. The Municipalities hereby each execute and join in the MOU as parties thereto and as additional entities constituting the Sponsor. 2. The Municipalities hereby each acknowledge and agree to assume and accept all rights and obligations of Sponsor under the MOU. , 3. The Municipalities each further acknowledge and agree that each will receive a material benefit from joining in and executing the MOU, and that this Joinder shall be attached to and become a part of the MOU and together with the MOU shall constitute one and the same agreement. 4. The terms and conditions of the MOU are hereby incorporated herein as if set forth in full in this Joinder. [Signatures on next page) WHEREFORE, the Municipalities have caused this Joinder and the Memorandum of Understanding to be executed by their duly authorized representatives as of the date set forth below. Elk Grove Village, Illinois By: Craig B. Johnson Date: 7/23/02 Name: Craig Johnson Title: City of Park Ridge, Illinois By: Date: Name: Ronald Wietecha Title: MEMORANDUM OF UNDERSTANDING AMONG THE VILLAGE OF BENSENVILLE, ILLINOIS, HOCIMEF AIRPORT, AND LCOR HOLDINGS LLC FOR PRE -DEVELOPMENT SERVICES FOR THE DEVELOPMENT OF A COMMERCIAL AIRPORT TO BE LOCATED IN TIM SOUTH SUBURBAN REGION OF CHICAGO, ILLINOIS WHEREAS, the Village of Bensenville, Illinois, together with certain other villages, towns, cities, municipalities, counties, and other political subdivisions and units of government, hereinafter joining in this Memorandum of Understanding (individually or collectively, the "Sponsor"), desire to cause the development, construction, and operation of a regional south suburban airport with passenger and cargo facilities (the "Project") to be located in the south suburban region of Chicago, Illinois, in order to meet public demand for additional airport facilities serving the south suburban region and to expand the Chicago region's aviation capacity on an efficient, cost-effective, expeditious and environmentally sound basis; WHEREAS, the Sponsor has entered into discussions and negotiations with Hochtief Airport, a limited liability company ("Hochtief), and LCOR Holdings LLC, a Delaware limited liability company ("LCOR"; and together with Hochtief, collectively, the "Developers") for the performance by the Developers of certain pre -development services in connection with the Project; WHEREAS, the development of a new south suburban airport has received widespread support from the State of Illinois and the affected and participating municipalities; WHEREAS, the Sponsor desires the Developers to begin the performance of certain services described herein on the terms and conditions set forth below; WHEREAS, promptly following the execution hereof, the parties will begin the negotiation of a definitive Pre -Development Services Agreement that will set forth in greater specificity the agreements among the parties relating to the subject matter hereof; and WHEREAS, the parties recognize the need for and importance of the development of the south suburban airport and in order to demonstrate their commitment to the Project, have agreed to the terms and conditions set forth below. NOW, THEREFORE, the Sponsor and the Developers agree as hereinafter set forth. 1. PROJECT DESCRIPTION AND STRUCTURE A. The Project involves the development, construction, and operation of a regional south suburban airport with passenger and cargo facilities to be located in the south suburban region of Chicago, Illinois. The State of Illinois currently owns or has under contract certain real property in Peotone, Illinois, the intended use of which is a new, third airport for the south suburban region of the Chicago metropolitan area. It is anticipated that such property would be transferred to the Sponsor or an inter- governmental authority or other venture to be formed by the Sponsor, which would then ground lease such property to the Developers for construction of the Project. H. SERVICES TO BE PROVIDED BY THE DEVELOPERS A. Pending execution of the Pre -Development Agreement, the Developers shall begin the following services in connection with the Project: 1. Analyze regional airport system, including markets served, demographics and air carrier trends, a demand analysis including a review of passenger traffic forecasts prepared by the Sponsor's consultants and an analysis of the aviation and non -aviation revenue potential; 2. Finalize forecasts of projected capital and operating costs, revenues, and debt service including an analysis of potential capital costs (including a review of the Sponsor's existing master plan and project cost estimates) and operating cost estimates; 3. Develop a financial plan for the construction and operation of the Project including an analysis of potential financing sources and structures which will be considered with a view towards achieving a structure that properly balances risk and cost; 4. Review forecasts of air carrier traffic for the Project and existing regional airports; 5. Refine development program and implementation path; 6. Finalize ownership and corporate structure and management team; 7. Draft a business plan for successful management of the Project; 8. Perform conceptual design and facilities plans for the layout and configuration of the Project, including phasing and expansion options; 9. Analyze surface transportation access to the Project; 10. Review Environmental Impact Statement and attendant issues; 11. Review land acquisition program; 12. Coordinate with the State and regional agencies; 13. Draft Development Agreement; 14. Assist in inclusion of additional municipalities in the entity to be formed to own and sponsor the Project; 15. Approach finance sources to determine the optimal financing available for the Project; 16. Develop a timeline for the Project; 17. Explore permitting and licensing issues, including any environmental issues and permits; 18. Propose candidates to act as the general contractor, the operator, and other key roles; 19. Prepare an investment grade project memorandum to present to potential investors and finance sources, including pro forma financial projections, and hold preliminary discussions with underwriters to determine optimal financing available for the Project; 20. Propose structure for development of third -party facilities, such as hangars, aircraft maintenance facilities, cargo warehouses and rental car facilities; and 21. Make recommendations regarding development of "outside the fence" industrial or commercial development. B. The Developers shall perform the services described herein through their own employees and through consultants with respect to (i) legal matters including negotiation of agreements, (ii) aviation analysis, (iii) financial analysis, and (iv) retail and third party development matters. Except for such consultants, the Developers shall not subcontract out any of the work described herein, or otherwise partner with any other persons or entities, without the prior written consent of the Sponsor, which shall not be unreasonably withheld. C. The Developers shall coordinate the performance of the services described herein with the authorized representatives of the Sponsor designated in writing from time to time. D. The Developers shall provide the Sponsor and/or its authorized representatives with status reports on the progress of the services described herein, which reports shall be made in a form to be mutually agreed upon between the Sponsor and the Developers. E. The results of all studies, investigations and inquiries, and all written work product produced by the Developers with respect to the services set forth in this MOU, shall be the sole and exclusive property of the Sponsor. M. PAYMENT FOR SERVICES A. The Pre -Development Services Agreement as defined in Paragraph V below, shall provide for the specific fee arrangements for the service to be provided by the Developers for the entire pre -development phase of the Project, including the respective contributions to the Project of the Sponsor and the Developers. The Sponsor will pay for a portion of the due diligence and the planning costs of the Developers, and the Developers shall also contribute their own resources to the Project in addition to the resources for which the Sponsors will pay. W. ROLE OF THE SPONSOR A. The Sponsor shall assist and cooperate with the Developers hereunder generally, and specifically shall assist the Developers in setting up meetings with elected officials, and introductions to potential sources of financing, contractors, operators or vendors as well as provide the Developers with all such information in Sponsor's possession considered essential for the services to be provided by the Developers under this MOU, such as the plans, studies and calculations already prepared for this Project. V. DOCUMENTATION A. The parties will promptly begin the preparation and negotiation of a definitive Pre -Development Services Agreement (the "Pre -Development Services Agreement"), which will set forth in detail the rights, duties, and obligations of the parties including but not limited to the time schedule for the provision of the services by the Developers as per item 11 above. The parties will negotiate in good faith, and will use good faith commercially reasonable efforts to agree upon, a mutually acceptable Pre - Development Services Agreement within thirty (30) days of the effective date of this MOU. B. Following the execution of a Pre -Development Services Agreement, the terms and conditions of this MOU shall be superseded and of no further force or effect. C. Subsequent to the Pre -Development Services Agreement, the parties anticipate that there will also be a Development Services Agreement among the parties, which will cover development services and actual construction of the Project. V1. MISCELLANEOUS k 4 A. The parties hereby covenant and agree that they shall work exclusively with each other with respect to the development of a third airport in the metropolitan Chicago area, and shall not negotiate with any other party pursuing the development of a third airport in the metropolitan Chicago area. B. While the village of Bensenville, Illinois initially is executing this MOU as the Sponsor, in the course of the development of the Project it is anticipated that a number of additional entities will join herein as additional entities constituting the Sponsor, and thereafter become constituent members of the inter -governmental authority or other entity ("IGA") to be formed to own and sponsor the development of the Project. Any such entities executing this MOU hereafter as "Sponsor" shall constitute individual entities making up the "Sponsor." Furthermore, in the event the IGA is formed prior to the execution of the Pre -Development Services Agreement, the Sponsor shall have the right to transfer all of its rights and obligations hereunder to the IGA provided the IGA has adequate financial resources to meet those obligations. C. LCOR and Hoehtief may by advance written notice to Sponsor and the other Developer assign its rights under this MOU to an affiliate which is owned and controlled by LCOR and Hochtief, as the case may be. D. This MOU shall be governed by the laws of the State of Illinois. E. The parties shall maintain (i) all information and materials provided by or on behalf of the other party, and (ii) the results of all studies, inquiries, and investigations performed by the other party relating to the subject matter of this MOU, and all written work product (collectively the "Confidential Infbmmation"), strictly confidential, provided that the parties may disclose such Confidential Information to the extent (x) consented to in writing by the other party, (y) required by law, or (z) that such Confidential Information is readily available in the public domain. Notwithstanding the foregoing, the Developers and Sponsor may disclose such Confidential Information to any consultant retained by the Sponsor, or the Developers, in accordance with Section II.A. above, as the case may be, as reasonably necessary in connection with performance of the services contemplated hereby, provided that the Developers and Sponsor shall inform each such consultant of the confidential nature of such Confidential Information and require each such consultant to maintain such Confidential Information as strictly confidential. The confidentiality obligation of the parties shall survive any termination of this MOU for a period of four (4) years. F. No release or public announcement by the parties of the existence of or content of this MOU shall be made without the prior written consent of the other party. G. No person or entity not a signatory hereto shall have any third -party beneficiary rights with respect to this MOU or the subject matter hereof. 5 H. This MOU may be executed in multiple original counterparts, each of which will be deemed to be an original, and which together will constitute one and the same agreement. I. Unless otherwise expressly provided in the Pre -Development Services Agreement, this MOU (other thea Section VI E. hereof) shall terminate upon the earlier to occur of (i) thirty (30) days after the effective date hereof MOU and (u) the effective date of the Pre -Development Services Agreement. [Signatures on the following page.] ID WHEREFORE, the parties have caused this Memorandum of Understanding to be duly executed as of the date set forth below. VILLAGE OF BENSENVILLE, ILLINOIS By: Date: 1 7 nr Name: i Title: HOCHTIEF AIRPORT, a limited liability company By: it II y Date: }fC r" 2,,,,- Name: ,,'LName: (-?, se -1 ?.o tat 0 Title: N e c k (la a v U- LCOR Holdings LLC, a Delaware limited liability company By: Date: Name: Title: 'C✓Y 16wea � - CD.� CAr,C�YcG WIIEREFORE, the parties have caused this Memorandum of Understanding to be duly executed as of the date set forth below. VILLAGE OF BENSENVILLE, ILLINOIS By: Date: Name: Title: HOCHTIEF AIRPORT, a limited liability company By: _ Name: Title: Date: LCOR Holdings LLC, a Delaware limited liability company By: :.rw i C.'s.' Date: Name: hAV6) A. Title: '�;Ct Mcu l N: 1255782 v.)