Exhibit 10.69
LOAN AGREEMENT
This Loan Agreement (the "Agreement") is made and entered into this day
of ________, 2002 by and between the City of Chicago, a municipal corporation
and home rule unit of local government (the "City"), acting through its
Department of Environment ("DOE"), and Sweetheart Cup Company Inc., a Delaware
corporation (the "Borrower").
SECTION I. R E C I T A L S.
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WHEREAS, pursuant to a settlement agreement dated as of May 12, 1999
(the "Settlement Agreement") between the City and Commonwealth Edison Company
("ComEd"), the City expects to receive certain funds from ComEd on an annual
basis until and including calendar year 2003 (the "ComEd Funds"); and
WHEREAS, on July 7, 1999, the City Council of the City approved an
ordinance (the "ComEd Ordinance") authorizing DOE to use the ComEd Funds and
enter into agreements to fulfil certain purposes described in the Settlement
Agreement and the ComEd Ordinance; and
WHEREAS, DOE wishes to use a portion of the ComEd Funds to make a loan
(the "Loan") to the Borrower for the Project, as more fully described in Exhibit
A attached hereto and made a part of this Agreement as if fully set forth
herein; and
WHEREAS, on March 22, 2002, the Borrower's governing body passed a
resolution, or an equivalent written record, authorizing the borrowing described
herein;
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and for other good and valuable consideration, receipt of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION II. GENERAL LOAN TERMS.
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A. INCORPORATION: The above recitals are incorporated herein and made a
part hereof by reference.
B. LOAN AMOUNT/PURPOSE: The amount of the Loan shall be as set forth in
Exhibit A. The Borrower shall use the Loan exclusively to complete the Project,
the estimated total cost of which is detailed in Exhibit B attached hereto and
incorporated herein by reference (the "Project Budget"). The Borrower is solely
responsible for any costs related to the Project which are in excess of the
aggregate Loan amount and, if required, will provide the City with satisfactory
evidence of its ability to finance or obtain financing for such excess costs of
the Project (such as a loan commitment or certification of its ability to
finance or obtain financing for the Project). The source of funds for
disbursements under this Agreement is Fund Number 115.
Upon (i) execution of this Agreement by the parties hereto, (ii)
receipt by the City from the Borrower of an executed promissory note (the "Note"
and, together with this Agreement, the "Loan Documents"), substantially in the
form attached hereto as Exhibit C, evidencing the Loan and dated as of even date
herewith, and (iii) receipt, review and approval by the City of all other
submissions, documents, and materials under this Agreement and the Note, the
City shall disburse the Loan proceeds to the Borrower.
C. TERM: This Agreement shall be effective as of the date hereof and
shall expire on the date set forth in Exhibit A (the "Term of Agreement").
D. INTEREST: Interest charged on the Loan, if any, shall be computed at
the rate per annum (the "Interest Rate") specified in Exhibit A and the Note.
E. REPAYMENT OF PRINCIPAL AND INTEREST: Principal and interest on the
Loan, if any, shall be due and payable in full as indicated in Exhibit A and the
Note.
F. PREPAYMENT: The Loan may be prepaid in full or in part from time to
time and at any time without premium or penalty.
G. THE BORROWER'S OBLIGATION IS UNCONDITIONAL: The Borrower's
obligation to repay the Loan is absolute and unconditional without defense or
set-off by reason of any default by the City under this Agreement or for any
other reason, including without limitation, failure to complete the Project or
any acts or circumstances that may constitute failure of consideration. It is
the intention of the parties that the payments required hereunder will be paid
in full when due without any delay or diminution whatsoever.
SECTION III. INSURANCE.
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The Borrower must provide and maintain at Borrower's own expense, or
cause to be provided during the term of the Agreement, the insurance coverages
and requirements specified below, insuring all operations related to the
Agreement.
A. INSURANCE TO BE PROVIDED:
(1) Workers Compensation and Employers Liability: Workers Compensation
Insurance, as prescribed by applicable law covering all employees who
are to provide a service under this Agreement and Employers Liability
coverage with limits of not less than $100,000 each accident or
illness.
(2) Commercial General Liability (Primary and Umbrella): Commercial
General Liability Insurance or equivalent with limits of not less than
$1,000,000 per occurrence for bodily injury, personal injury, and
property damage liability. Coverages must include the following: All
premises and operations, products/completed operations, explosion,
collapse, underground, separation of insureds, defense, and contractual
liability (with no
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limitation endorsement). The City of Chicago is to be named as an
additional insured on a primary, non-contributory basis for any
liability arising directly or indirectly from the Project.
(3) Automobile Liability (Primary and Umbrella): When any motor
vehicles (owned, non-owned and hired) are used in connection with the
Project, the Borrower must provide Automobile Liability Insurance with
limits of not less than $1,000,000 per occurrence for bodily injury and
property damage.
(4) Professional Liability: When any architects, engineers,
construction managers or other professional consultants perform work in
connection with this Agreement, Professional Liability Insurance
covering acts, errors, or omissions must be maintained with limits of
not less than $1,000,000.
(5) Builders Risk/Installation: When Borrower undertakes any
construction, the Borrower must provide or cause to be provided All
Risk Builders Risk/Installation Insurance at replacement cost for
materials, supplies, equipment, machinery and fixtures that are or will
be part of the permanent facility or project. The City of Chicago is to
be named loss payee as their interests may appear.
(6) Property: Upon completion of construction/rehabilitation work, the
Borrower must provide All Risk Insurance, including improvements and
betterments in the amount of full replacement value of the property.
The City of Chicago is to be named as an additional insured and loss
payee as their interests may appear.
B. OTHER REQUIREMENTS
The Borrower must furnish the City of Chicago, Department of
Environment, 00 Xxxxx XxXxxxx Xxxxxx 00000, original Certificates of Insurance,
evidencing the required coverage to be in force on the date of this Agreement,
and Renewal Certificates of Insurance, or such similar evidence, if the
coverages have an expiration or renewal date occurring during the term of this
Agreement. The Borrower must submit evidence of insurance on the City of Chicago
Insurance Certificate Form (copy attached) or equivalent prior to execution of
this Agreement by the City. The receipt of any certificate does not constitute
agreement by the City that the insurance requirements in the Agreement have been
fully met or that the insurance policies indicated on the certificate are in
compliance with all Agreement requirements. The failure of the City to obtain
certificates or other insurance evidence from Borrower shall not be deemed as a
waiver by the City of any requirements for the Borrower to obtain and maintain
the specified coverages. The Borrower must advise all insurers of the Agreement
provisions regarding insurance. Non-conforming insurance does not relieve
Borrower of the obligation to provide insurance as specified herein.
Nonfulfillment of the insurance conditions may constitute a violation of the
Agreement, and the City retains the right to stop work until proper evidence of
insurance is provided, or the Agreement may be terminated.
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The insurance must provide for 30 days prior written notice to be given
to the City in the event coverage is substantially changed, canceled, or
non-renewed.
Any deductibles or self insured retentions on referenced insurance
coverages must be borne by the Borrower.
The Borrower agrees that insurers waive their rights of subrogation
against the City of Chicago, its employees, elected officials, agents, or
representatives.
The coverages and limits furnished by Borrower in no way limit the
Borrower's liabilities and responsibilities specified within this Agreement or
by law.
Any insurance or self insurance programs maintained by the City of
Chicago do not and shall not contribute with insurance provided by the Borrower
under this Agreement.
The required insurance to be carried pursuant to this Agreement is not
limited by any limitations expressed in the indemnification language in this
Agreement or any limitation placed on the indemnity in this Agreement given as a
matter of law.
The Borrower must require all subcontractors to provide the insurance
required herein, or the Borrower may provide the coverages for subcontractors.
All subcontractors are subject to the same insurance requirements of the
Borrower unless otherwise specified in this Agreement.
If the Borrower or subcontractor desire additional coverages, the party
desiring the additional coverages is responsible for the acquisition and cost.
The City of Chicago Risk Management Department maintains the right to
modify, delete, alter or change these requirements.
SECTION IV. WARRANTIES, REPRESENTATIONS AND/OR COVENANTS.
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The Borrower hereby warrants, represents and/or covenants to the City
that:
A. All representations, warranties and covenants of the Borrower
contained in this Agreement are true, accurate and complete as of the date
hereof. The Borrower covenants that all representations, warranties and
covenants of the Borrower contained in this Agreement shall continue to be true,
accurate and complete, in all material respects, for as long as the Loan is
outstanding.
B. The Borrower shall use proceeds of the Loan exclusively to complete
the Project at the location(s) specified in Exhibit A (the "Premises").
C. The Borrower or its successors or assigns shall continue operating
the Project at the Premises during the term of this Agreement and thereafter for
a period of time of not less than three calendar years.
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D. If the Borrower is a corporation or a legal entity other than an
individual, the Borrower warrants and represents that the execution, delivery
and performance by the Borrower of this Agreement has been duly authorized by
any and all necessary corporate action. A copy of the Borrower's resolution or
its equivalent, if any, is attached as Exhibit D.
E. The Borrower represents and warrants that the execution and delivery
of this Agreement by the Borrower and performance of its obligations hereunder
will not violate any applicable provision of law or result in the breach of or
constitute a default or require any consent under, or result in the creation of
any lien, charge or encumbrance (other than any agreed to in writing by the
City) upon the Premises or any property or assets of the Borrower or pursuant to
any indenture or other agreement or instrument to which the Borrower is a party
or by which the Borrower or its property or the Premises may be bound or
affected, other than as specifically provided herein, and except to the extent
with respect to the foregoing, no breach, default or creation of lien, charge or
encumbrance could not reasonably be expected to have a material adverse effect
on the Borrower.
F. The Borrower, the Project and the Premises are now in compliance
with all applicable laws, rules, regulations, orders, ordinances, codes and the
like, pertaining to or affecting the Borrower, the Project or the Premises. The
Borrower covenants that the Borrower, the Project and the Premises shall remain
in compliance with all applicable laws, rules, regulations, orders, ordinances,
codes and the like, pertaining to or affecting the Borrower, the Project or the
Premises for the Term of this Agreement.
G. The Borrower is not in default with respect to any loan, mortgage or
agreement related to borrowing monies to which it is a party and no event has
occurred which would create any default upon the passage of time, except to the
extent with respect to the foregoing default cannot reasonably be expected to
have a material adverse effect on the Borrower.
H. The Borrower shall immediately notify the City of any and all events
or actions of which it has knowledge which could reasonably be expected to have
a material adverse effect on the Borrower's ability to carry on its operations
or perform its obligations under this or any other material agreement.
I. The Borrower shall keep and maintain such books, records and other
documents as shall be required by the City and necessary to reflect and disclose
fully the amount and disposition of the Loan proceeds, and the total cost of the
activities paid for, in whole or in part, with Loan proceeds. All such books,
records and other documents shall be available at the offices of the Borrower
for inspection, copying, audit and examination at all reasonable times by any
duly authorized representative of the City.
J. Any duly authorized representative of the City shall, at all
reasonable times, have access to all portions of the Premises where the Project,
or any portion of the Project, is located.
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K. The rights of access and inspection to the Premises and the
Borrower's books and records as provided herein shall continue until the
completion of all close-out procedures respecting the Loan and until the final
settlement and conclusion of all issues arising out of the Loan.
L. The Borrower agrees that, so long as this Agreement remains
outstanding:
(1) the Borrower shall not, directly or indirectly,
discriminate against any individual in hiring, classification, grading,
discharge, discipline, compensation or other term or condition of
employment because of the individual's race, color, sex, age, religion,
disability, national origin, ancestry, sexual orientation, marital
status, parental status, military discharge status or lawful source of
income;
(2) the Borrower will take affirmative action to ensure that
applicants are employed and that employees are treated during
employment, without regard to their race, color, sex, age, religion,
disability, national origin, ancestry, sexual orientation, marital
status, parental status, military discharge status or lawful source of
income. Such action shall include, but not be limited to, employment
upgrading, demotion, transfer, recruitment or recruitment advertising,
layoff or termination, rates of pay, or other forms of compensation and
selection for training, including apprenticeship. The Borrower agrees
to post in conspicuous places, available to employees and applicants
for employment, notices setting forth the provisions of this
non-discrimination clause; and
(3) the Borrower will comply with all applicable federal,
state and local laws which prohibit discrimination, including but not
limited to, the aforementioned forms of discrimination.
M. No member, official or employee of the City shall have any personal
interest, direct or indirect, in the Borrower's business or shall participate in
any decision relating to the Borrower's business which affects his/her personal
interests or the interests of any corporation, partnership or association in
which he/she is directly interested.
N. No former member, official or employee of the City shall, for a
period of one year after the termination of the member's, official's or
employee's term of office or employment, assist or represent the Borrower in any
business transaction involving the City or any of its agencies, if the member,
official or employee participated personally and substantially in the subject
matter of the transaction during his/her term of office or employment, provided
that if the member, official or employee exercised contract management authority
with respect to a contract (including any loan from the City), this prohibition
shall be permanent as to that contract.
O. Additional warranties, representations and/or covenants, if any, are
set forth in Exhibit A.
SECTION V. CONDITIONS PRECEDENT TO CLOSING.
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At or prior to the execution of this Agreement, the following
conditions shall have been met:
A. COSTS AND EXPENSES: As applicable, the Borrower shall pay for all
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UCC searches, ownership searches, tax lien and judgment lien searches, opinions
rendered as required by the City and any other reasonable costs and expenses
relating to the Loan.
B. EVIDENCE OF COMPLIANCE: The Borrower shall furnish to the City
evidence as required by the City (such as permits) showing that the Project and
the Premises are in compliance with all applicable laws, rules, regulations,
orders, ordinances, codes and the like, pertaining to or affecting the Borrower,
the Project and the Premises.
C. ECONOMIC DISCLOSURE STATEMENT: If required to do so, the Borrower
will complete an Economic Disclosure Statement ("EDS") which will be provided by
DOE. The completed EDS shall be attached hereto as Exhibit E.
D. LOAN MONIES USED FOR PRIOR EXPENSES: If the Loan proceeds shall be
used to reimburse the Borrower for prior payments or deposits, the Borrower
shall furnish to the City canceled checks, invoices or other documentation
evidencing such prior expenses deemed acceptable by the City.
SECTION VI. EVENTS OF DEFAULT: Any of the following shall constitute
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an event of default under this Agreement:
A. any representation or warranty made by the Borrower in this
Agreement or in any document, affidavit or certificate of the Borrower furnished
to the City that shall have been incorrect in any material respect; or
B. a default in the payment, when due, of any sum payable by the
Borrower under this Agreement; or
C. a default in the performance or observance of any obligation or
covenant to be performed or observed by it contained herein and fails to cure
such default within ten (10) days of written notice of default by the City to
the Borrower; or
D. the Borrower shall (1) apply for or consent to the appointment of a
receiver, trustee, or liquidator of itself, or of all or a substantial part of
its assets, or (2) be unable, or admit in writing its inability to pay its debts
as they become due, or (3) make a general assignment for the benefit of
creditors, or (4) be adjudicated a bankrupt or insolvent, or (5) file a
voluntary petition in bankruptcy or a petition or an answer seeking
reorganization or an answer admitting the material allegations of a petition
filed against it in any bankruptcy, reorganization or insolvency proceeding.
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SECTION VII. REMEDIES: If an event of default shall occur, or pursuant
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to Section VI(C) shall occur and be continuing:
A. the City may immediately declare the principal of and interest
accrued, if any, on the Loan to be forthwith due and payable, whereupon the same
shall become immediately due and payable; and
B. the City shall have the right to exercise any and all remedies
available at law or in equity.
SECTION VIII. OTHER PROVISIONS.
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In addition to all of the other terms and conditions of this Agreement,
the Borrower hereby covenants and agrees to the following:
A. NO WAIVER BY THE CITY: Any waiver by the City of any default on the
part of the Borrower shall not waive or affect any other default, whether prior
or subsequent thereto or a repetition of the same default.
B. NO JOINT VENTURE/DISCLAIMER OF RELATIONSHIP: The relationship
between the City and the Borrower shall be only that of creditor-debtor and no
relationship of agency, partner or joint or co-venturer or any other third-party
relationship shall be created by or inferred from this Agreement. The Borrower
shall indemnify, defend and hold the City harmless from any and all claims
asserted against the City as being the agent, partner, or joint-venturer of the
Borrower.
C. FINAL AGREEMENT: The terms and conditions of this Agreement are the
final written expression of the parties. All prior discussions, negotiations and
agreements are of no force and effect except to the extent such agreements are
referred to herein. This Agreement can be modified only in writing duly executed
by all parties. This Agreement may not be assigned without the prior written
consent of the City.
D. INTERPRETATION: Should any provision of this Agreement be adjudged
to be unenforceable, it shall, at the City's election, be deemed to be
automatically reformed to the extent possible to render it enforceable and, in
any event, the invalidity or unenforceability of one provision of this Agreement
shall not affect or impair the validity or enforceability of any of the
remaining provisions of this Agreement. Section and paragraph headings are for
convenience only and do not bear on the construction or interpretation of the
content of this Agreement. The singular number shall include the plural, the
plural the singular and the use of any gender, or the neutral form, shall be
applicable to all genders.
E. TIME OF ESSENCE: Time is of the essence of this Agreement. All times
herein specified are, in each case, firm and shall not be extended without the
City's written approval.
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F. THE CITY'S RIGHT TO USE THE BORROWER'S NAME: The City shall have the
right, upon the written consent of the Borrower, to: (a) include the Borrower,
the Premises and the Project, its name and photograph or artistic rendering and
other pertinent information in the City's promotional literature and
communications, and (b) erect a sign of a size and style approved by the City in
a conspicuous location on the Premises during the term of the Loan indicating
financing has been provided by the City.
G. [Intentionally Omitted.]
H. [Intentionally Omitted.]
I. INDEMNIFICATION: The Borrower covenants and agrees, at its expense,
to pay and to indemnify and save the City, the City's officers, employees and
agents harmless from and against any and all claims, damages, demands, expenses,
liabilities and taxes (of any character or nature whatsoever, regardless of by
whom imposed), and losses of every conceivable kind, character and nature
whatsoever (including, but not limited to, claims for loss or damage to any
property or injury to or death of any person asserted by or on behalf of any
person, firm, corporation or governmental authority arising out of, resulting
from, or in any way connected with, the Project or Premises), or the condition,
occupancy, use, possession, conduct or management of, or any work done in or
about, or involving, the Project or Premises. The Borrower also covenants and
agrees, at its expense, to pay and to indemnify and save the City, the City's
officers, employees and agents, harmless from and against all costs, counsel
fees (including the fees of any outside counsel retained by the City and the
City's Corporation Counsel, the City's officers, employees and agents, or any of
them), expenses and liabilities incurred in any action or proceeding brought by
reason of any such claim or demand. In the event that any action or proceeding
is brought against the City, the City's officers, employees and agents, by
reason of any such claim or demand, the Borrower, upon notice from the City,
shall resist and defend such action or proceeding on behalf of the City, the
City's officers, employees and agents. The City shall have the right to employ
separate counsel in any such Claim and to participate in the defense thereof.
The fees and expenses of such counsel so incurred shall be at the expense of the
Borrower without regard to any authorization of such employment by the Borrower.
This obligation on the part of the Borrower shall survive the closing of this
Loan, the repayment of the Loan and any cancellation of this Agreement.
J. 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 instrument.
SECTION IX. NOTICES
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Unless otherwise specified, any notice, demand or request required
hereunder shall be effective only if given in writing at the addresses set forth
in Exhibit A, by any of the following means: (a) personal service; (b)
electronic communications, whether by telex, telegram, telecopy or facsimile;
(c) overnight courier, receipt requested; or (d) registered or certified mail,
return receipt requested.
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Such addresses may be changed by notice to the other parties given in
the same manner provided above. Any notice, demand or request sent pursuant to
either clause (a) or (b) above shall be deemed received upon such personal
service or upon dispatch by electronic means with confirmation of receipt. Any
notice, demand or request sent pursuant to clause (c) above shall be deemed
received on the Business Day immediately following deposit with the overnight
courier, and any notice, demand or request sent pursuant to clause (d) above
shall be deemed received Business Days following deposit in the mail.
SECTION X. GOVERNING LAW
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This Loan Agreement and the other Loan Documents shall be governed by
and construed in accordance with the internal laws of the State of Illinois
without regard to its conflict of laws principles.
SECTION XI. NO BUSINESS RELATIONSHIP WITH CITY ELECTED OFFICIALS
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Pursuant to Section 2-156-030(b) of the Municipal Code of Chicago, it
is illegal for any elected official of the City, or any person acting at the
direction of such official, to contact, either orally or in writing, any other
City official or employee with respect to any matter involving any person with
whom the elected official has a "Business Relationship" (as defined in Section
0-000-000 of the Municipal Code of Chicago), or to participate in any discussion
in any City Council committee hearing or in any City Council meeting or to vote
on any matter involving the person with whom an elected official has a Business
Relationship. Violation of Section 2-156-030(b) by any elected official, or any
person acting at the direction of such official, with respect to any of the Loan
Documents, or in connection with the transactions contemplated thereby, shall be
grounds for termination of the Loan Documents and the transactions contemplated
thereby. The Borrower hereby represents and warrants that, to the best of its
knowledge after due inquiry, no violation of Section 2-156-030(b) has occurred
with respect to any of the Loan Documents or the transactions contemplated
thereby.
SECTION XII. LABOR STANDARDS
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If Loan proceeds are used for construction, the Borrower agrees for
itself and shall contractually obligate its General Contractor, if any, and each
subcontractor, if any, so that during the construction of the Project:
A. All labor standards and prevailing wage schedules of the Illinois
Prevailing Wage Act (820 ILCS 130/0.01 et seq.) are met; and
B. (1) Consistent with the findings which support the
Minority-Owned and Women-Owned Business Enterprise Procurement
Program (the"MBE/WBE Program"), Section 2-92-420 et seq.,Municipal Code
of Chicago, and in reliance upon the provisions of the MBE/WBE Program
to the extent contained in,and as qualified by, the provisions of this
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Paragraph XII.B, during the course of the Project, at least the
following percentages of the aggregate hard construction costs (as
set forth in the Project Budget) shall be expended for contract
participation by minority-owned businesses ("MBEs") and by women-owned
businesses ("WBEs"): (i) At least 25 percent by MBEs; and (ii) At least
five percent by WBEs,
(2) For purposes of this Paragraph XII.B only, the Borrower
(and any party to whom a contract is let by the Borrower in connection
with the Project) shall be deemed a "contractor" and this Loan
Agreement (and any contract let by the Borrower in connection with the
Project) shall be deemed a "contract" as such terms are defined in
Section 2-92-420, Municipal Code of Chicago. In addition, the term
"minority-owned business" or "MBE" shall mean a business enterprise
identified in the Directory of Certified Minority Business Enterprises
published by the City's Department of Procurement Services, or
otherwise certified by the City's Department of Procurement Services as
a minority-owned business enterprise; and the term "women-owned
business" or "WBE" shall mean a business enterprise identified in the
Directory of Certified Women Business Enterprises published by the
City's Department of Procurement Services, or otherwise certified by
the City's Department of Procurement Services as a women-owned business
enterprise,
(3) Consistent with Section 2-92-440, Municipal Code of
Chicago, the Borrower's MBE/WBE commitment may be achieved in part by
the Borrower's status as an MBE or WBE (but only to the extent of any
actual work performed on the Project by the Borrower) or by a joint
venture with one or more MBEs or WBEs (but only to the extent of the
lesser of (i) the MBE or WBE participation in such joint venture or
(ii) the amount of any actual work performed on the Project by the MBE
or WBE), by the Borrower utilizing a MBE or a WBE as the General
Contractor (but only to the extent of any actual work performed on the
Project by the General Contractor), by subcontracting or causing the
General Contractor to subcontract a portion of the Project to one or
more MBEs or WBEs, or by the purchase of materials used in the Project
from one or more MBEs or WBEs, or by any combination of the foregoing.
Those entities which constitute both a MBE and a WBE shall not be
credited more than once with regard to the Borrower's MBE/WBE
commitment as described in this Paragraph XII.B,
(4) The Borrower shall deliver quarterly reports to DOE during
the Project describing its efforts to achieve compliance with this
MBE/WBE commitment. Such reports shall include, inter alia, the name
and business address of each MBE and WBE solicited by the Borrower or
the General Contractor to work on the Project, and the responses
received from such solicitation, the name and business address of each
MBE or WBE actually involved in the Project, a description of the work
performed or products or services supplied, the date and amount of such
work, product or service, and such other information as may assist DOE
in determining the Borrower's compliance with this MBE/WBE commitment.
The Borrower shall maintain records of all relevant data with respect
to the utilization of MBEs and WBEs in connection with the Project for
at least
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five years after completion of the Project, and DOE shall have
access to all such records maintained by the Borrower, on five Business
Days' notice, to allow the City to review the Borrower's compliance
with its commitment to MBE/WBE participation and the status of any MBE
or WBE performing any portion of the Project,
(5) Upon the disqualification of any MBE or WBE General
Contractor or Subcontractor, if such status was misrepresented by the
disqualified party, the Borrower shall be obligated to discharge or
cause to be discharged the disqualified General Contractor or
Subcontractor, and, if possible, identify and engage a qualified MBE or
WBE as a replacement. For purposes of this subsection, the
disqualification procedures are further described in Section 2-92-540,
Municipal Code of Chicago,
(6) Any reduction or waiver of the Borrower's MBE/WBE
commitment as described in this Paragraph XII.B shall be undertaken in
accordance with Section 2-92-450, Municipal Code of Chicago, and
(7) Prior to the commencement of the Project, the Borrower
shall be required to meet with the monitoring staff of DOE with regard
to the Borrower's compliance with its obligations under this Paragraph
XII.B. The General Contractor and all major Subcontractors shall be
required to attend this pre-construction meeting. During said meeting,
the Borrower shall demonstrate to DOE its plan to achieve its
obligations under this Paragraph XII.B, the sufficiency of which shall
be approved by DOE. During the Project, the Borrower shall submit the
documentation required by this Paragraph XII.B to the monitoring staff
of DOE. Failure to submit such documentation on a timely basis, or a
determination by DOE, upon analysis of the documentation, that the
Borrower is not complying with its obligations under this Paragraph
XII.B, shall, upon the delivery of written notice to the Borrower, be
deemed an Event of Default. Upon the occurrence of any such Event of
Default, in addition to any other remedies provided under any of the
Loan Documents, the City may: (i) issue a written demand to the
Borrower to halt the Project, (ii) withhold any further payment of any
Loan proceeds to the Borrower or the General Contractor, or (iii) seek
any other remedies against the Borrower available at law or in equity.
SECTION XIII. CITY RESIDENT EMPLOYMENT REQUIREMENT
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The Borrower agrees for itself and its successors and assigns, and
shall contractually obligate the general contractor who performs the Project
(the "General Contractor") and shall cause the General Contractor to
contractually obligate the subcontractors the General Contractor engages to
perform the Project (the "Subcontractors"), as applicable, to agree, that during
the Project they shall comply with the minimum percentage of total worker hours
performed by actual residents of the City as specified in Section 2-92-330 of
the Municipal Code of Chicago (at least 50 percent of the total worker hours
worked by persons on the site of the Project shall be performed by actual
residents of the City); provided, however, that in addition to complying with
this percentage, the Borrower, the General Contractor and the Subcontractors
shall be required to
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make good faith efforts to utilize qualified residents of the City in both
unskilled and skilled labor positions.
The Borrower may request a reduction or waiver of this minimum
percentage level of Chicagoans as provided for in Section 2-92-330 of the
Municipal Code of Chicago in accordance with standards and procedures developed
by the Chief Procurement Officer of the City.
"Actual residents of the City" shall mean persons domiciled within the
City. The domicile is an individual's one and only true, fixed and permanent
home and principal establishment.
The Borrower, the General Contractor and the Subcontractors shall
provide for the maintenance of adequate employee residency records to ensure
that actual Chicago residents are employed on the Project. The Borrower, the
General Contractor and the Subcontractors shall maintain copies of personal
documents supportive of every Chicago employee's actual record of residence.
Weekly certified payroll reports (U.S. Department of Labor Form WH-347
or equivalent) shall be submitted to the Commissioner of DOE in triplicate,
which shall identify clearly the actual residence of every employee on each
submitted certified payroll. The first time that an employee's name appears on a
payroll, the date that the company hired the employee should be written in after
the employee's name.
The Borrower, the General Contractor and the Subcontractors shall
provide full access to their employment records to the Chief Procurement
Officer, the Commissioner of DOE, the Superintendent of the Chicago Police
Department, the Inspector General, or any duly authorized representative
thereof. The Borrower, the General Contractor and the Subcontractors shall
maintain all relevant personnel data and records for a period of at least three
years after final acceptance of the work constituting the Project.
At the direction of DOE, affidavits and other supporting documentation
will be required of the Borrower, the General Contractor and the Subcontractors
to verify or clarify an employee's actual address when doubt or lack of clarity
has arisen.
Good faith efforts on the part of the Borrower, the General Contractor
and the Subcontractors to provide utilization of actual Chicago residents (but
not sufficient for the granting of a waiver request as provided for in the
standards and procedures developed by the Chief Procurement Officer) shall not
suffice to replace the actual, verified achievement of the requirements of this
Section XIII concerning the worker hours performed by actual Chicago residents.
When work at the Project is completed, in the event that the City has
determined that the Borrower failed to ensure the fulfillment of the requirement
of this Section concerning the worker hours performed by actual Chicago
residents or failed to report in the manner as indicated
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above, the City will thereby be damaged in the failure to provide the benefit of
demonstrable employment to Chicagoans to the degree stipulated in this Section.
Therefore, in such a case of non-compliance, it is agreed that 1/20 of 1
percent, 0.0005, of the aggregate hard construction costs set forth in the
Project Budget (as the same shall be evidenced by approved contract value for
the actual contracts) shall be surrendered by the Borrower to the City in
payment for each percentage of shortfall toward the stipulated residency
requirement. Failure to report the residency of employees entirely and correctly
shall result in the surrender of the entire liquidated damages as if no Chicago
residents were employed in either of the categories. The willful falsification
of statements and the certification of payroll data may subject the Borrower,
the General Contractor and/or the Subcontractors to prosecution. Any retainage
to cover contract performance that may become due to the Borrower pursuant to
Section 2-92-250 of the Municipal Code of Chicago may be withheld by the City
pending the Chief Procurement Officer's determination whether the Borrower must
surrender damages as provided in this paragraph.
Nothing herein provided shall be construed to be a limitation upon the
"Notice of Requirements for Affirmative Action to Ensure Equal Employment
Opportunity, Executive Order 11246" and "Standard Federal Equal Employment
Opportunity, Executive Order 11246," or other affirmative action required for
equal opportunity under the provisions of this Loan Agreement or the other Loan
Documents.
The Borrower shall cause or require the provisions of this Section XIII
to be included in the Borrower's contract with the General Contractor (the
"Construction Contract") and all applicable subcontracts between the General
Contractor and the Subcontractors ("Subcontracts").
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IN WITNESS WHEREOF, the City and the Borrower have caused this
Agreement to be duly executed and delivered as of the date first above written.
CITY OF CHICAGO
an Illinois municipal corporation
-----------------------------------------
Commissioner, Department of Environment
-----------------------------------------
Director, Office of Budget and Management
-----------------------------------------
City Comptroller, Department of Finance
SWEETHEART CUP COMPANY INC.
a Delaware corporation
By:
--------------------------------------
Its:
--------------------------------------
15
EXHIBIT A
TERMS OF AGREEMENT
1. As referred to in this Agreement:
The Borrower will use the proceeds of the Loan to purchase and install
(1) compressed air system improvements, (2) lighting improvements, and
(3) mechanical system improvements (the "Project") at 0000 Xxxxx
Xxxxxxx, Xxxxxxx Xxxxxxxx 00000 (the "Premises").
2. As referred to in the Recitals and SECTION II(B):
The Loan amount shall be $2,000,000
3. As referred to in SECTION II(C):
The Term of Agreement shall commence on the date hereof and the
Agreement shall remain in effect until the later of (i) August 1, 2014,
or (ii) the date on which all amounts due by the Borrower to the City
pursuant to the provisions of the Agreement, at the City's discretion,
are paid in full (the "Expiration Date").
4. As referred to in SECTIONS II(D):
The Interest Rate shall be Zero( 0) percent per annum and shall be
calculated as specified on the Note dated the date hereof from the
Borrower to the City.
5. As referred to in SECTION II(E):
Principal shall be due and payable in equal installments of $100,000
commencing on February 1, 2004 (the "Initial Payment Date") and every 6
months thereafter.
6. As referred to in SECTION IV(M):
Additional warranties, representations or covenants: None.
7. As referred to in SECTION IX:
Notices shall be sent to the following addresses:
IF TO THE BORROWER: Sweetheart Cup Company Inc.
00000 Xxxxxxxxxxx Xxxx
Xxxxxx Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxx
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WITH A COPY TO: Sweetheart Cup Company Inc.
000 Xxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxx
IF TO THE CITY: City of Chicago
Department of Environment
00 Xxxxx XxXxxxx Xxxxxx, Xxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Deputy Commissioner, Energy
WITH A COPY TO: City of Chicago
Department of Law
000 Xxxxx XxXxxxx Xxxxxx, Xxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: Finance & Economic Development Division
17
EXHIBIT B
PROJECT BUDGET
Total estimated project budget is $ 7,011,069
Loan from City is $2,000,000
18
EXHIBIT C
FORM OF NOTE
PROMISSORY NOTE
Chicago, Illinois
$2,000,000 __________ __, 2002
FOR VALUE RECEIVED, the undersigned, Sweetheart Cup Company Inc., a
Delaware corporation, and its successors and assigns ("Maker"), hereby promises
to pay to the order of the City of Chicago, Illinois ("Holder") at its
Department of Finance, 00 Xxxxx XxXxxxx Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxx
00000, or at such other place as Holder may appoint, the principal sum of Two
Million Dollars ($2,000,000) at a rate of Zero percent per annum on the
outstanding principal balance from time to time, payable as follows:
Principal shall be due and payable in equal installments of $100,000
commencing on February 1, 2004 (the "Initial Payment Date") and every 6 months
thereafter.
Any interest charged on this Note will accrue on the basis of a year
consisting of 360 days, comprised of 12 months of 30 days each.
In connection with that certain Loan, as defined in that certain Loan
Agreement dated of even date herewith between Holder and Maker (the "Loan
Agreement" and, together with this Note, the "Loan Documents"), to be made by
Holder to Maker in connection with the Project (as defined in the Loan
Agreement), Maker has executed and delivered this Promissory Note. All
capitalized terms used but not otherwise defined herein shall have the same
meanings as set forth in the Loan Agreement.
This Note may be prepaid by Maker at any time, in whole or in part, at
a price equal to 100% of the principal amount being prepaid plus accrued
interest on such amount to the prepayment date.
If any payment of principal or interest, if any, due hereunder, or any
other charges due to Holder as required under this Note or the other Loan
Documents, shall not be paid on the date such payment is due, Maker shall pay
Holder hereof as liquidated damages and not as a penalty an additional "late
charge" of 15 percent of such delinquent payment or the maximum permitted by
law, whichever is less, in order to defray the increased cost of collection
occasioned by any such late payments. Further, any such delinquent payments (not
including interest payments) shall bear interest from and after the date due at
the lesser of the rate of 15 percent per annum or the maximum rate permitted by
law until so paid.
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Maker will pay all costs and expenses of collection, including
attorneys' fees, incurred or paid by Holder in enforcing this Note or the
obligations evidenced by the Loan Documents to the extent permitted by law.
Maker hereby waives presentment, demand, notice, protest and all other
demands or notices in connection with the delivery, acceptance, endorsement,
performance, default or enforcement of this Note, except as may be specifically
set forth in the Loan Documents as to notices.
Holder is expressly authorized to apply payments made under this Note
as Holder may elect against any and all amounts, or portions thereof, then due
and payable to Holder hereunder or under any of the Loan Documents.
Upon Maker's failure to pay, when due, any installment of principal of
or interest, if any, on this Note in accordance with the terms hereof, or upon
Maker's failure to pay when due (including any applicable notice and/or cure
periods) any other sums or perform or observe any covenant, term or provision
hereof on a timely basis as required hereunder (which failure to perform or
observe remains unremedied for 30 days after notice thereof from Holder to
Maker; provided, however, that Holder shall not be precluded during any such
periods from exercising any remedies available under any of the Loan Documents),
or upon the occurrence of an Event of Default under any of the other Loan
Documents, then, at the option of Holder hereof, Holder may elect without notice
to Maker to accelerate the maturity of this Note and upon such election the
principal sum remaining unpaid hereon, together with accrued interest, if any,
hereon and any additional indebtedness due by Maker to Holder under any of the
Loan Documents, shall become at once due and payable at the place of payment as
aforesaid, and Holder may proceed to exercise any rights and remedies available
to Holder under any of the Loan Documents and to exercise any other rights and
remedies against Maker or with respect to this Note which Holder may have at
law, in equity or otherwise. None of the rights or remedies of Holder hereunder
or under any of the Loan Documents are to be deemed waived or affected by any
failure to exercise same. All remedies conferred upon Holder by the Loan
Documents or any other instrument, document or agreement to which Maker is a
party or under which Maker is bound, shall be cumulative and not exclusive; any
such remedies may be exercised singularly, concurrently or consecutively at
Holder's option.
No delay or omission on the part of Holder in exercising any right
hereunder shall operate as a waiver of such right or of any other right of
Holder, nor shall any delay, omission or waiver on any one occasion be deemed a
bar to or waiver of the same or any other right on any future occasion.
The parties hereto intend and believe that each provision in this Note
comports with all applicable law. However, if any provision in this Note is
found by a court of law to be in violation of any applicable law, and if such
court should declare any provision of this Note to be unlawful, void or
unenforceable as written, then it is the intent of all parties hereto that such
provision shall be given full force and effect to the fullest possible extent
that is legal, valid and
20
enforceable, that the remainder of this Note shall be construed as if such
unlawful, void or unenforceable provision were not contained herein, and that
the rights, obligations and interests of Maker and Holder under the remainder of
this Note shall continue in full force and effect.
Upon any endorsement, assignment or other transfer of this Note by
Holder or by operation of law, the term "Holder" as used herein shall mean such
endorsee, assignee or other transferee or successor. This Note shall inure to
the benefit of Holder, its successors and assigns and shall be binding upon
Maker, its successors and assigns.
MAKER HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT
LOCATED WITHIN THE STATE OF ILLINOIS, AND WAIVES PERSONAL SERVICE OF ANY AND ALL
PROCESS UPON IT, AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE AND BE
EFFECTIVE IN THE MANNER PRESCRIBED FOR NOTICES AS SET FORTH HEREIN. MAKER HEREBY
WAIVES TRIAL BY JURY, ANY OBJECTION BASED UPON FORUM NON CONVENIENS, AND ANY
OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER. NOTHING IN THIS PARAGRAPH
SHALL AFFECT THE RIGHT OF HOLDER TO SERVE LEGAL PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR AFFECT THE RIGHT OF HOLDER TO BRING ANY ACTION OR PROCEEDING
AGAINST MAKER OR ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION.
Unless otherwise specified, any notice, demand or request required
hereunder shall be given in writing at the addresses set forth below, by any of
the following means: (a) personal service; (b) electronic communications,
whether by telex, telegram or telecopy; (c) overnight courier, receipt
requested; or (d) registered or certified mail, return receipt requested.
IF TO HOLDER: Department of Environment
City of Chicago
00 Xxxxx XxXxxxx Xxxxxx, Xxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Commissioner
WITH COPIES TO: Office of the Corporation Counsel
City of Chicago
000 Xxxxx XxXxxxx Xxxxxx, Xxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: Finance and Economic Development Division
and
Department of Finance
City of Chicago
00 Xxxxx XxXxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: City Comptroller
21
IF TO MAKER: Sweetheart Cup Company Inc.
00000 Xxxxxxxxxxx Xxxx
Xxxxxx Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxx
WITH A COPY TO: Sweetheart Cup Company Inc.
000 Xxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxx
Such addresses may be changed by notice to the other parties given in
the same manner provided above. Any notice, demand or request sent pursuant to
either clause (a) or (b) above shall be deemed received upon such personal
service or upon dispatch by electronic means with confirmation of receipt. Any
notice, demand or request sent pursuant to clause (c) above shall be deemed
received on the Business Day immediately following deposit with the overnight
courier, and any notice, demand or request sent pursuant to clause (d) above
shall be deemed received two Business Days following deposit in the mail.
This Note shall be construed and enforced according to the internal
laws of the State of Illinois without regard to its conflict of laws principles.
Nothing herein or in any of the Loan Documents shall limit the rights
of Holder, following any of the events hereinafter described, to take any action
as may be necessary or desirable to pursue Maker for any and all losses incurred
by Holder arising from: (i) a material misrepresentation, fraud made in writing
or misappropriation of funds by Maker; (ii) intentional, or material waste to
the Premises; (iii) use of proceeds of the Loan for costs other than the
Project; (iv) any breach of Maker's representations, warranties or covenants
contained in any of the Loan Documents; (v) the occurrence of any uninsured
casualty to the Premises for which there has been a failure to maintain
insurance coverage as required by the terms and provisions of the Loan
Documents; (vi) the misappropriation or misapplication of insurance proceeds or
condemnation awards relating to the Premises; or (vii) any inaccuracy in the
statements in the Loan Documents.
In any case where the date of payment of interest, if any, on or
principal of this Note shall not be a Business Day, then payment of such
interest or principal need not be made on such date but may be made on the next
succeeding Business Day and, if interest is charged on this Note, this Note
shall continue to bear interest until such date of payment.
THE TERMS AND PROVISIONS OF THE LOAN DOCUMENTS ARE HEREBY INCORPORATED
BY REFERENCE AND MADE A PART OF THIS NOTE.
22
IN WITNESS WHEREOF, Maker has caused this Note to be duly executed on
the date first above written.
Sweetheart Cup Company Inc.,
a Delaware corporation
By: _________________________
Its: _________________________
23
EXHIBIT D
BORROWER'S RESOLUTIONS
24
EXHIBIT E
ECONOMIC DISCLOSURE STATEMENT
