Loading...
HomeMy WebLinkAboutRESOLUTION - 42-14 - 9/23/2014 - CULTIVATION FACILITY - FLORAMEDEX LLCRESOLUTION NO. 42-14 A RESOLUTION AUTHORIZING THE MAYOR AND VILLAGE CLERK TO EXECUTE A DEVELOPMENT AND OPERATING AGREEMENT — CULTIVATION FACILITY BETWEEN THE VILLAGE OF ELK GROVE VILLAGE AND FLORAMEDEX, LLC 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 1: That the Mayor be and is hereby authorized to sign the attached document marked: DEVELOPMENT AND OPERATING AGREEMENT CULTIVATION FACILITY 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 document upon the signature of the Mayor. Section 2: That this Resolution shall be in full force and effect from and after its passage and approval according to law. VOTE: AYES: 5 NAYS: 0 ABSENT: I PASSED this 23rd day of September 2014. APPROVED this 23rd day of September 2014. APPROVED: Mayor Craig B. Johnson Village of Elk Grove Village ATTEST: Judith M. Keegan, Village Clerk A.-reemenlCultivation F loramedex DEVELOPMENT AND OPERATING AGREEMENT CULTIVATION FACILITY THIS DEVELOPMENT AND OPERATING AGREEMENT ("Agreement") is made and entered into as of this 9°i day in September, 2014, by and between the Village of Elk Grove Village, Illinois, a Home Rule Illinois municipal corporation located in Cook and DuPage Counties, Illinois (the "Village"), and Floramedex, LLC ("Cultivator") an Illinois LLC. RECITALS A. On August 1, 2013, the Illinois Legislature enacted the Compassionate Use of Medical Cannabis Pilot Program Act, 410 ILCS 130 et seq. ("Act"). The purpose of the Act was to distinguish between medical and non-medical cannabis and to ". . . protect patients with debilitating medical conditions, as well as their physicians and providers, from arrest and prosecution, criminal and other penalties, and property forfeiture if the patients engage in the medical use of cannabis." (420 ILCS 130/5) B. The Act authorizes the State the right to grant a license ("License") Cultivation Facilities (Section 10-(e)) where medical cannabis can be grown for sale only to approved dispensary organizations as that term is defined in the Act. C. Cultivator has represented to the Village that it intends to apply for a License to operate a Cultivation Facility within the corporate boundaries of the Village. Cultivator further represents that it has no knowledge of any events or acts that would prevent Cultivator or any of its members from receiving a License. D. The Village has agreed that in the event Cultivator obtains a License to open and operate a Cultivation Facility as required by the Act, that in exchange for good and valuable consideration as set forth herein, the Village will cooperate with Cultivator in allowing the Cultivation Facility to be located in the Village. -2- E. The Corporate Authorities of the Village have taken all required actions prior to the execution of this Agreement in order to make the same binding upon it according to its terms. NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements herein contained, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties do hereby agree as follows: I RECITALS PART OF AGREEMENT The representations, covenants and recitations set forth in the foregoing recitals are material to this Agreement and are hereby incorporated into and made a part of this Agreement as though they were fully set forth in this Article I. II MUTUAL ASSISTANCE The Parties agree to take such actions, including the execution and delivery of such documents, instruments, petitions and certifications, as may be necessary or appropriate, from time to time, to carry out the terms, provisions and intent of this Agreement and to aid and assist each other in carrying out said terms, provisions and intent. III CULTIVATOR'S ACKNOWLEDGMENTS AND REPRESENTATIONS 3.01 Cultivator's Application for License. Cultivator hereby represents and warrants that it intends to complete and submit an application to the Illinois Department of Agriculture ("Department") for a License to operate a Cultivation Facility as soon as reasonably practicable after the Department makes such applications available and begins accepting the same. Cultivator further represents that it has no criminal background nor any other reason set forth in -3 - the Act that would be a basis for the State to deny such License. Cultivator shall notify the Village in writing within five (5) business days after it learns of the State's disposition of Cultivator's application. If Cultivator is granted a License, it shall deliver a copy of the License to the Village within five (5) business days after its receipt of the same, and in the event the License is renewed amorally as required by the Act, Cultivator shall deliver a copy of the renewed License. Should the Dispensary not receive a license by the State, then this Agreement shall be deemed null and void. 3.02 Village License. In order to facilitate the implementation of the provisions of this Agreement, the Village reserves the right to enact an Ordinance which would require Cultivator to obtain a license ("Village License") to operate a Cultivation Facility in the Village, provided, however, that any such License requirement shall not alter, amend, change or otherwise adversely affect the provisions of this Agreement. Any Village License issued by the Village shall be for the sole benefit of and in the name of the party that has received a License from the State and shall not be transferred or assigned to a third party except as set forth in Section 7.07 hereof. IV ZONING AND BUILDING 4.01 Building for Cultivation Facility. Cultivator hereby agrees that upon receipt of its Village License and an occupancy permit issued by the Village, it shall only be permitted to open and operate the Cultivation Facility in a building located in the Village's I-2 industrial zoning district. Cultivator will comply with all of the requirements of the I-2 district. 4.02. Building Material and Design. A. Design. Cultivator intends to make a multi-million dollar investment in the design and construction of a state-of-the-art building and related site improvements (the `Building") to -4 - house the operations of the Cultivation Center. The Building, which will be approximately one hundred thousand (100,000) square feet, is expected to be completed within six (6) to twelve (12) months after Cultivator receives the License. The Building will be designed in such a way as to not be identifiable as a Cultivation Facility. Cultivator hereby agrees that the Village shall have the right in its reasonable discretion to approve the Building design and materials. The Building will be designed to look like other buildings in the Business Park with external enhancements. Cultivator is committed to working with the Village to develop strategies for recruiting qualified, local personnel to fill employment positions with Cultivator and identifying and utilizing locally -owned businesses to provide materials and services during the construction of the Building and the operation of the Cultivation Center. B. Landscaping. Cultivator shall submit a landscaping plan for the exterior of the building that is substantially like other buildings in the Business Park for approval by the Village, which approval will not be unreasonably denied. C. Fencing and Driveway. The entire Building will be surrounded by a solid precast fence, no less than six feet (6') in height on the sides and rear of the Building and six feet (6') in front of the Building. The driveway into the property shall be gated with a wrought iron or other metal gates and shall be opened and closed only for permitted persons as allowed by the Act. D. Si na e. The Building shall have no signage other than the Building address and directional signage. E. Odor Containment. The Building's ventilation system or odor containment system shall be constructed in such a manner so as to comply with all applicable Codes and Ordinances and the Village's Zoning Performance Standards (the "Existing Standards"). F. Applicable Codes. The Village hereby agrees that any building codes or regulations that it adopts after the effective date hereof that conflict with the Existing Standards shall not be applicable to the design, planning or construction of the Building for a period of two (2) years after the date hereof. -5- 4.03 Loading Docks / Refuse Containers. All loading docks for the Building shall be internal. While trucks are being loaded and unloaded, the dock doors shall remain closed. All refuse containers shall also be kept within Building. 4.04 Cessation of Operations. In the event that the Cultivator License is expired, revoked or terminated whether by the State or intervention by the Federal Government, Cultivator shall immediately cease its operations and remove all materials related to the growing, processing and storage of Cannabis. V PUBLIC SAFETY/SECURITY 5.01 Security. Cultivator shall design and implement a security plan and security system that satisfies the requirements of Section 105 (b) of the Act and any additional requirements as may be reasonably imposed by the Village. Cultivator shall deliver to the Village a copy of its plans and the Village hereby represents and warrants it will use its best efforts to keep all documents confidential. The security plan shall include facility access controls, surveillance systems, on- site security personnel, and other security measures required by State and local regulations. The security plan shall be reviewed and approved by the Police Department. Notwithstanding anything contained herein to the contrary, the approval of Cultivator's security plan and/or security system by the Illinois State Police shall be conclusive proof of Cultivator's compliance with this Section 5.01. 5.02 Security Connection. Cultivator shall provide a Direct Connect to Northwest Central Dispatch, as well as a video feed to the Village's Police Department, as well as any necessary equipment needed for the Police Department to view the video feed. 5.03 Video Camera Security System. Cultivator shall provide the Police Department with direct access to their facility's video camera security system. Moreover, the Cultivator shall maintain and store video footage for a total of thirty (30) days. Video footage shall be provided both inside and outside of the facility. Outside video feed shall include coverage of the M Cultivator's entrance, parking lots, and loading dock. Should the Police Department need additional hardware and software to access the Cultivator video camera security system, Cultivator will be required to provide the Police Department with necessary hardware and software. 5.04 On-site Security Personnel. Cultivator shall provide on-site security personnel during normal hours of operation. 5.05 Sprinkler & Fire Alarm System. Cultivator shall be required to install an approved automatic sprinkler and fire alarm system throughout the entire building structure. VI FEES/CONTRIBUTIONS 6.01 Village Fee. Cultivator agrees to pay to the Village a fee (to be divided into a "Village Fee" and a "Site & Infrastructure Fee" as specified herein), the designation of such as a sales or use tax, impact fee or otherwise to be determined at a later date giving due consideration to applicable State regulations concerning said fees. Irrespective of the determined designation, the Village Fee payable directly to Elk Grove Village shall be a designated percentage of the gross sales of the Cultivator to all approved dispensing facilities, payable monthly. An additional fee shall be deposited into a segregated account held by Cultivator to be used for site and infrastructure upgrades (the "Site & Infrastructure Fee") as set forth herein. The Site & Infrastructure Fee shall be used to fund site improvements that will enhance the site and provide an aesthetic benefit to the neighboring properties, and fund infrastructure improvements that will benefit the operation of the cultivation facility. "Site Improvements" include, but are not limited to: fagade, landscaping, and site upgrades; exterior Building improvements and other expenses required to be incurred by Cultivator in order to comply with -7 - the terms of this Agreement; as well as site lighting and security monitoring components for the benefit of Cultivator's property. "Infrastructure Improvements" include, but are not limited to: replacement of watermain, replacement/reconditioning of sanitary sewermain, stormwater improvements, electric system upgrades, security cameras and related infrastructure, road reconstruction or resurfacing, street lighting, environmental remediation, and pedestrian mobility in the vicinity of Cultivator's property and within the Village's industrial business corridor. Cultivator shall maintain an accounting balance of the Site & Infrastructure Fee funds and shall respond to reasonable requests from the Village regarding the fund balance and expenditures for Site Improvements. Written, prior agreement by the parties is required prior to any expenses being incurred for Infrastructure Improvements for which the Village will seek reimbursement from the Site & Infrastructure Fund. A breakdown of the fee structure shall be as follows: Years Village Fee Site & Infrastructure Fee Years 1-3 2.5% 2.5% Years 4-6 3.0% 2.0% Years 7 + 3.5% - At the end of the sixth (6'h) year, all unallocated Site & Infrastructure Fee funds will be distributed to the Village's Industrial/Commercial Revitalization Fund to be used within the Business Park at the Village's sole discretion. Cultivator shall submit to the Village a copy of the tax return required to be filed with the Illinois Department of Revenue with respect to its operations at the Building, which return shall set forth the gross sales for each monthly period submitted. The return shall be accompanied by payment to the Village of the Village Fee and proof of Cultivator's deposit of the Site & Infrastructure Fee into the segregated fund as set forth herein. Should the designation of the fee be challenged by the State or any other party for whatever reason, Cultivator shall not object or challenge any re -designation, it being understood that the Village is entitled to such payment, irrespective of form or designation, unless the payment, irrespective of form or designation, is declared by the State or a court of competent jurisdiction to violate the Act and/or other applicable law. 6.02 Community Contributions. Cultivator shall provide an annual donation in the amount of Thirty Thousand U.S. dollars ($30,000) to the Village of Elk Grove Village for community events and outreach. In addition, Cultivator shall provide annual donations in the amount of Fifteen Thousand U.S. dollars ($15,000) to each of the following organizations or programs: • Kenneth Young Youth Center for drug and mental health treatment programs; • Elk Grove Village Police Drug Education Program; and • Alexian Brothers Medical Center's Foundation for substance abuse and mental health, The Village reserves the right to reallocate the annual donations based upon need and requirements. While the initial community groups are listed above, the Village reserves the right to modify the list of community organizations, and may also add additional community organizations while redistributing the allocation allotment, provided that such additional community organizations are consistent with the spirit and intent of the charity designations specified in Cultivator's application for the License. The Community Contributions shall be subject to renegotiating by the parties on the tenth (10th) anniversary of the Commencement Date, provided the Agreement is so extended. In the event the parties are unable to agree upon new terms within thirty (30) days after the tenth (10th) anniversary, the parties shall submit their issue to a mutually agreeable mediator or mediation facility for a resolve. The decision of the mediator shall be binding on the parties. ESE VII GENERAL PROVISIONS 7.01 Default. If any Party to this Agreement shall fail to perform any of its obligations under this Agreement, the other non -defaulting Party may notify, in writing, the defaulting Party and advise of the alleged failure and demand that same be remedied or cured. No default or breach of this Agreement shall be deemed committed if the breach or default is remedied within thirty (30) days, of receipt of such notice. If the defaulting party fails to remedy the default within thirty (30) days, the non -defaulting party may seek such remedies that are available in a court of law, including specific performance. 7.02 Entire Agreement / Amendment. This Agreement constitutes the entire agreement between the parties and there are no oral or parole agreements, representations or inducements existing between the parties which are not expressly set forth herein and covered hereby. This Agreement may not be amended or modified except by written agreement signed by all of the parties. 7.03 Severability. If any provision, covenant, agreement or portion of this Agreement, or its application to any person, entity or property, is held invalid, such invalidity shall not affect the application or validity of any other provisions, covenants or portions of this Agreement and, to that end, any provisions, covenants, agreements or portions of this Agreement are declared to be severable. 7.04 Applicable Law. This Agreement shall be construed in accordance with the laws of the State of Illinois. 10- 7.05 Notice. All notices and requests required pursuant to this Agreement shall be sent as follows: To Cultivators: Floramedex, LLC 7444 W. Wilson Harwood Heights, IL 60706 With copies to: Jigar K. Patel Attorney at Law 10560 W. Cermak Road Westchester, IL 60154 And To the Village: Village of Elk Grove Village 901 Wellington Avenue Elk Grove, IL 60007-3499 Attn: Village Manager With copies to: Village Attorney Village of Elk Grove Village 901 Wellington Avenue Elk Grove Village, IL 60007-3499 All notices sent by mail shall be deemed effectively delivered on the business day next following the date of mailing. All notices personally delivered, sent by facsimile transmission, or sent by overnight courier shall be deemed effectively given on the date of such delivery. 7.06 Counterparts. This Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same agreement. 7.07 Assignment. Cultivator may not assign, or otherwise transfer all or any part of its interest in the Agreement or in the Village License without the prior written consent of the Village, which consent shall not be unreasonably withheld; provided, however, that the Cultivator may assign its interest in the Agreement and/or the Village License, without consent to its parent company, any subsidiary or affiliate of it or its parent company or to any successor in interest, affiliate or other entity approved by the Department, or any successor agency thereof, to hold the License by virtue of such assignment or transfer; provided, however that any such assignee or transferee shall be precluded from relocating the Cultivation Center outside of the corporate limits of the Village during the term of this Agreement. Notwithstanding anything to the contrary contained in this Agreement, Cultivator may assign, mortgage, pledge, hypothecate or otherwise transfer without consent its interest in this Agreement to any financing entity, or agent on behalf of any financing entity to whom Cultivator (i) has obligations for borrowed money or in respect of guaranties thereof, (ii) has obligations evidenced by bonds, debentures, notes, or similar instruments, or (iii) has obligations under or with respect to letters of credit, bankers acceptances and similar facilities or in respect of guaranties thereof. 7.08 Term / Renewal. A. Tenn. The term of this Agreement shall commence upon execution by both parties and tenninate on the tenth (10`s) anniversary of the Commencement Date (the "Term"), unless otherwise extended. B. Option to Extend. The tern of this Agreement shall be automatically renewable for a total of two (2) ten (10) year terns ("Renewal Terms") each following the original tern or any renewable term at the annual fee structure stated below and otherwise upon the same terns and conditions stated in this Agreement. If Cultivator desires not to extend any subsequent term of the Agreement, it shall give the Village written notice of its intention not to extend the term at least ninety (90) days prior to the -12 - expiration of the then current term whereupon the Agreement shall be deemed canceled upon the expiration of the then current term. C. Termination. Should the Act be repealed or not extended beyond the initial Pilot period, then this Agreement shall terminate and Cultivator shall cease doing business in the Village. Should the State extend the time period for the Act or enact new legislation enabling the Compassionate Use of Medical Cannabis Program (or its successor) to continue, then, so long as Cultivator maintains a valid License and valid Village License, this Agreement shall automatically be renewed annually for each and every year subsequent to the date wherein this Agreement is continued. Notwithstanding the above referenced termination by Cultivator upon expiration of the current term, Cultivator shall have the right to terminate this Agreement by giving the Village written notice of its intention to terminate at least ninety (90) days prior to the termination date in effect; provided, however that in the event that Cultivator terminates this Agreement prior to the expiration of the initial Tenn, Cultivator covenants and agrees not to thereafter relocate the Cultivation Center outside of the corporate limits of the Village for a period of one (1) year after the date of such tenmination. (Signature Pcrge to Follow) -13 - IN WITNESS WHEREOF, the Parties have duly executed this Agreement pursuant to all requisite authorizations as of the date first above written. FLORAMEDEX, LLC VILLAGE OF ELK GROVE VILLAGE, An Illinois Limited Liability Company An Illinois Municipal Corporation By: r�ID A'L Its Mem e ATTEST: By: —� Its Member By: Craig B. Johnson Its Mayor ATTEST: By: Judith M. Keegan Village Clerk