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HomeMy WebLinkAboutRESOLUTION - 31-14 - 9/9/2014 - ABJ DISPENSARIESRESOLUTION NO. 31-14 A RESOLUTION AUTHORIZING THE MAYOR AND VILLAGE CLERK TO EXECUTE A DEVELOPMENT AND OPERATING AGREEMENT — DISPENSING ORGANIZATION BETWEEN THE VILLAGE OF ELK GROVE VILLAGE AND ILLINOIS ABJ DISPENSARIES 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 DISPENSING ORGANIZATION 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: 6 NAYS: 0 ABSENT: 0 PASSED this 9'h day of September 2014. APPROVED this 9`h day of September 2014. APPROVED: Mayor Craig B. Johnson Village of Elk Grove Village ATTEST: Judith M. Keegan, Village Clerk AgreementILAW D ispensaries DEVELOPMENT AND OPERATING AGREEMENT DISPENSING ORGANIZATION THIS DEVELOPMENT AND OPERATING AGREEMENT ("Agreement") is made and entered into as of this 9`h 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 Illinois ABJ Dispensaries ("Dispensary") an Illinois Limited Liability Company. 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 130/10) B. The Act authorizes the State the right to grant a license ("License") to a Dispensing Organization (Section 115-(a)) where medical cannabis can be sold. C. Dispensary has represented to the Village that it intends to apply for a License to operate a Dispensing Organization within the corporate boundaries of the Village. Dispensing Organization further represents that it has no knowledge of any events or acts that would prevent Dispensary or any of its members from receiving a License. D. The Village has agreed that in the event the Dispensary obtains a License to open and operate a Dispensing Organization as required by the Act, that in exchange for good and valuable consideration as set forth herein, the Village will cooperate with Dispensary in allowing the Dispensing Organization to be located in the Village. 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 DISPENSARY'S ACKNOWLEDGMENTS AND REPRESENTATIONS 3.01 Dispensary's Application for License. Dispensary hereby represents and warrants that it intends to complete and submit an application to the Illinois Department of Financial and Professional Regulation ("Department") for a License to operate a Dispensing Organization as soon as reasonably practicable after the Department makes such applications available and begins accepting the same. Dispensary further represents that it has no criminal background nor any other reason set forth in the Act that would be a basis for the State to deny such License. Dispensary shall notify the Village in writing within five (5) business days after it learns of the State's disposition of Dispensary's application. If Dispensary 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 annually as required by the Act, Dispensary 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 Dispensary to obtain a license ("Village License") to operate a Dispensing Organization 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 Site for Dispensing Organization. A. Zoning. Dispensary hereby agrees that upon receipt of its Village License, an approved zoning application, and Certificate of Occupancy issued by the Village, it shall only be permitted to open and operate the Dispensing Organization in a building located in the Village's I-1 zoning district. Dispensary will comply with all of the requirements of the I-1 district. B. Occupancy. The Dispensary building will function as a stand-alone, single -tenant facility. 4.02. Building Material and Design. A. Design. Dispensary 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. B. Landscaping. Dispensary shall submit a landscaping plan for the exterior of the building for approval by the Village, which approval will not be unreasonably denied. C. Site Lighting. All parking areas for this facility will be appropriately lighted to ensure safety for all who work and conduct business at this facility, and shall meet all Village requirements for parking lots. D. Signage. Aside from Building address and directional signage, terms including but not limited to "marijuana", "cannabis", "weed", and/or "pot" shall be prohibited from inclusion in the buildings signage. Furthermore, the Village prohibits the use of marijuana or marijuana paraphernalia emblems on any exterior building identification 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. 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. 4.03 Loading Docks / Refuse Containers. All product shall be loaded internally. While delivery vehicles are being loaded and unloaded, the dock doors shall remain closed. All refuse containers shall also be kept within the Building. 4.04 Retail Operations. A. Retail Operations. The retail space shall not occupy more than twenty percent (20%) of the floor area of the primary building or structure located on the subject lot or parcel. B. Storage of Product. No medical cannabis or related product shall be displayed or kept so as to be visible to the general public from within or outside the premises. All products shall be kept and warehoused in the back of the facility out of view from the general public. C. Hours of Operation. Dispensing facilities shall have hours of operation not earlier than 7:00 a.m. and no later than 7:00 p.m. D. Drive -Through. Drive-through facilities are strictly prohibited in all dispensary buildings. E. Onsite Use is Prohibited. No marijuana shall be smoked, eaten or otherwise consumed or ingested on the premises. F. Plan for Disposal. Dispensary shall provide Village a plan for disposal of any medical cannabis or byproducts that are not sold to a patient or primary caregiver in a manner that protects any portion thereof from being possessed or ingested by any person and shall abide by applicable State and local regulations. V PUBLIC SAFETY/SECURITY 5.01 Security. Dispensary shall design and implement a security plan and security system that satisfies the requirements of the Section 130 (c) of the Act and any additional requirements as may be reasonably imposed by the Village. Dispensary shall deliver to the Village a copy of its security 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 Dispensary's security plan and/or security system by the Illinois State Police shall be conclusive proof of Dispensary's compliance with this Section 5.01. 5.02 Emergency Points of Contact. Dispensary shall provide the Police Department with up- to-date emergency contact information for the facility owner. In addition, the Dispensary shall provide up-to-date contact information for all facility managers. Facility managers are those key decision makers who will be on-site and authorized to make operational decisions. 5.03 Security Connection. Dispensary 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 5.04 Video Camera Security System. Dispensary shall provide Police Department with direct access to their facility's video camera security system. Moreover, the Dispensary 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 Dispensary entrance and parking lots. Should the Police Department need additional hardware and software to access the Dispensary video camera security system, Dispensary will be required to provide Police Department with necessary hardware and software. 5.05 On-site Personnel. Dispensary shall provide no fewer than two (2) personnel to be on- site at all times during normal hours of operation. 5.06 On-site Security Personnel. Dispensary shall provide on-site security personnel during normal hours of operation. 5.07 Sprinkler & Fire Protection System. Dispensary shall be required to install an approved automatic sprinkler and fire alarm system throughout the entire building structure. 5.08 Health & Public Safety Inspections. Dispensary shall permit the Village to conduct inspections to ensure the health and safety of the general public and occupants of the facility. 5.09 Health & Public Safety Meetings. Dispensary shall agree to meet with the Village quarterly in order to maintain open lines of communication and discuss operations. VI FEES / CONTRIBUTIONS 6.01 Village Fee. Dispensary hereby acknowledges that the Village will incur certain extraordinary costs as a result of the location of the Dispensing Organization in the Village's Business Park. Such extraordinary costs include, but are not limited to costs for increased Police surveillance and monitoring, increased Fire Department monitoring, as well as increased costs for other departments necessarily incurred to protect and maintain the health, safety and welfare of Village residents and businesses. Dispensary agrees to pay to the Village a fee (the "Village Fee"), 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. The payment from the Dispensary is considered to be a voluntary contribution to the Village, but given in response to the pledges made by the Village in the Agreement. Irrespective of the determined designation, the fee shall be 0.5% of the gross sales of the Dispensary, payable monthly. Dispensary shall submit to the Village a copy of the tax return required to be filed with the Illinois Department of Revenue with respect to Dispensing Organizations, which return shall set forth the gross sales for each monthly period submitted. The return shall be accompanied by payment to the Village the fee as above set forth. The payment of the Village Fee to the Village, though established in an amount equal to a percentage of the gross sales of the Dispensary shall not in any way make the Village a partial owner of the Dispensing Organization. Such contribution is a voluntary one induced in part by the promises of the Village made within this Agreement, and does not entitle the Village to any role whatever in the operations of the Dispensary other any the exercise of such powers as it may choose to carry out as a governmental body. Should the designation of the fee be challenged by the State or any other party for whatever reason, Dispensary 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. Dispensary shall provide an annual donation to the Village of Elk Grove Village for community events and outreach. In addition, Dispensary shall provide amoral donations to the Village that are to be given 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 Programs; and • Alexian Brothers Medical Center's Foundation for substance abuse and mental health. The annual schedule of the disbursement of Community Contributions is outlined below: Years Village Per Community Organization (3) Total Community Contribution Years 1-5 $ 5,000 $ 5,000 ($15,000) $20,000 Years 5 + $10,000 $10,000 ($30,000) $40,000 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. 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. 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. 7.05 Notice. All notices and requests required pursuant to this Agreement shall be sent as follows: To Dispensary: Illinois ABJ Dispensaries, LLC c/o Richard Adler 1228 Pine Street Winnetka, Illinois 60093 Rill 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. Dispensary may not assign, or otherwise transfer all or any part of its interest in the Agreement or the Village License without the prior written consent of the Village; provided, however, that Dispensary may assign its interest without consent to its parent company. Notwithstanding anything to the contrary contained in this Agreement, Dispensary 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 Dispensary (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. Term. The term of this Agreement shall commence upon execution by both parties and terminate on the tenth (10`h) anniversary of the Commencement Date (the "Term"), unless otherwise extended. B. Option to Extend. The term of this Agreement shall be automatically renewable for a total of two (2) ten (10) year terms ("Renewal Terms") each following the original term or any renewable term at the annual fee structure stated below and otherwise upon the same terms and conditions stated in this Agreement. If Dispensary 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 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 Dispensary 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 Dispensary maintains a valid License and valid Village License, this Agreement shall automatically be renewed amorally for each and every year subsequent to the date wherein this Agreement is continued. Notwithstanding the above referenced termination by Dispensary upon expiration of the current term, Dispensary 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 Dispensary terminates this Agreement prior to the expiration of the initial Term, Dispensary covenants and agrees not to thereafter relocate the Dispensing Organization outside of the corporate limits of the Village for a period of one (I) year after the date of such termination. (Signature Page to Follow) IN WITNESS WHEREOF, the Parties have duly executed this Agreement pursuant to all requisite authorizations as of the date first above written. ILLINOIS ABJ DISPENSARIES, VILLAGE OF ELK GROVE VILLAGE, An Illinois Limited Liability Company An Illinois Municipal Corporation ATTEST: By: Craig B. Johnson Its Mayor ATTEST: By: Judith M. Keegan Village Clerk �1 ATTEST: By: Craig B. Johnson Its Mayor ATTEST: By: Judith M. Keegan Village Clerk