Office of the City Clerk - Record #: F2011-190

Record #:

F2011-190

Type:

Report

Status:

Placed on File

Intro date:

7/6/2011

Current Controlling Legislative Body:

Final action:

7/6/2011

Title:

Tax Increment Financing (TIF) Addison South Redevelopment Project Area Annual Report (2010)

Sponsors:

Dept./Agency

Topic:

TAX INCREMENT FINANCING DISTRICTS - Addison South T.I.F.

Attachments:

1. F2011-190.pdf

Date	Journal Page Number	Action By	Action	Result	Action Details	Meeting Details	Captions
7/6/2011	2024	City Council	Placed on File		Action details	Meeting details	Not available

OFFICE OF THE MAYOR

CITY OF CHICAGO

JUN 30 2011

RAHM EMANUEL

MAYOR

June 22, 2011

BY:_-

COMPTROLLER L.G.A.D.

Hand-delivered June M. Canello

TIF Administrator, Local Government Office of the Illinois Comptroller 100 West Randolph - Suite 15-500 Chicago, Illinois 60601

Re: Notice of the Designation of a City of Chicago TIF Administrator for Purposes of Filing the 2010 Tax Increment and Industrial Jobs Recovery Annual Reports for the City of Chicago (the "City")

Dear Ms. Canello:

This letter is intended to meet the requirements of your office as set forth in the "TIF Administrator Contact Information" section of your office's 'Tax Increment Finance Report Instructions" for fiscal year 2010.

Please be advised that the City's Department of Housing and Economic Development (the "Department"), which is the successor department to the prior Department of Community Development, has the primary responsibility for preparing and filing the Tax Increment and Industrial Jobs Recovery annual reports with the Illinois Comptroller as required by 65 ILCS 5/11-74.4 et seq. and 65 ILCS 5/11-74.6 et seq. The administrative head of the Department, and thus the TIF Administrator for the City, is the Commissioner of the Department of Housing and Economic Development (the "Commissioner").

Andrew J. Mooney has been the Commissioner of the Department since February 9,2011 and remains in that position to the present day. He is the TIF Administrator for the City for . purposes of filing the City's 2010 Tax Increment and Industrial Jobs Recovery Annual Reports.

Sincerely,

2010 Annual Report

Addison South Redevelopment Project Area

Pursuant to 65 ILCS 5/ll-74.4-5(d)

June 30,2011

CQMRTROL-IER

\v^vfMsaa.)lMt'

ANNUAL TAX INCREMENT FINANCE REPORT OFFICE OF ILLINOIS COMPTROLLER JUDY BAAR TOPINKA

Name of Municipality: Chicago Reporting Fiscal Year: 2010

County:Cook Fiscal Year End: 12/31/2010

UnitCode: 016/620/30

First Name: Andrew J. Last Name: Mooney

Address: City Hall 121 N. LaSalle Title: TIF Administrator

Telephone: (312)744-0025 City; Chicago, IL Zip: 60602

E-Mail: TIFReports@cityofchicago.org

I attest to the best of my knowledge, this report of the redevelopment project areas in:

City/Village of Chicago _is complete and accurate at the end of this reporting

Fiscal year under theTax Increment Allocation Redevelopment Act [65 ILCS 5/11-74.4-3 et. seq.j ■ Or the Industrial Jobs Recovery Law'[65 ILCS 5/11-74.6-10 et. seq.]

Written signature of TIF Aoministfrator _^Pal<?

Section 1 (65 ILCS 5/11-74.4-5 (d) (1.5) and 65 ILCS 5/11-74.6-22 (d) (1.5)*)


Name of Redevelopment Project Area	Date Designated	Date Terminated
105th/Vincennes	10/3/2001	12/31/2025
111th Street/Kedzie Avenue Business District	9/29/1999	9/29/2022
119th and Halsted	2/6/2002	12/31/2026
119th/l-57	11/6/2002	12/31/2026
126th and Torrence	12/21/1994	12/21/2017
134th and Avenue K	3/12/2008	3/12/2032
24th/Michigan	7/21/1999	7/21/2022
26th and King Drive	1/11/2006	12/31/2030
35th and Wallace	12/15/1999	12/31/2023
35th/Halsted	1/14/1997	12/31/2021
35th/State	1/14/2004	12/31/2028
40th/State	3/10/2004	12/31/2028
43rd/Cottage Grove	7/8/1998	7/8/2021
45thAA/estern Industrial Park Conservation Area	3/27/2002	12/31/2026
47th/Ashland	3/27/2002	12/31/2026
47th/Halsted	5/29/2002	12/31/2026
47th/King Drive	3/27/2002	12/31/2026
47th/State	7/21/2004	12/31/2028
49th Street/St. Lawrence Avenue	1/10/1996	12/31/2020
51st/ Archer	5/17/2000	12/31/2024
53rd Street	1/10/2001	12/31/2025
60th and Western	5/9/1996	5/9/2019

*AII statutory citations refer to one of two sections of the Illinois Municipal Code: the Tax Increment Allocation Redevelopment Act [65 ILCS 5/11-74.4-3 et. seq.] or the Industrial Jobs Recovery Law [65 ILCS 5/11-74.6-10 et. seq.j

Janics U. Thompson .t_Vnk'r tjOrnl (iovcniim'iil DnKioit 1(111 W. Hmuliilpl, Sin-cl, Snilv l,i-,5«l Cll'u'ntjo. Il.ofttKH

IV!.: 1877) 301 USH'I I nii Cll'2] Kl i-'-»lKf> Ivnnil: lo<-j.>v">man.io.-.M.iU-.il.us

COMPTROLLER

ANNUAL TAX INCREMENT FINANCE REPORT OFFICE OF ILLINOIS COMPTROLLER JUDY BAAR TOPINKA

Name of Municipality: Chicago

County:Cook

UnitCode: 016/620/30

Reporting Fiscal Year: 2010 Fiscal Year End: 12/31 /2010

63rd/Ashland	3/29/2006	12/31/2030
63rd/Pulaski	5/17/2000	12/31/2024
67th/Cicero	10/2/2002	12/31/2026
69thyAshland	11/3/2004	12/31/2028
71st and Stony Island	10/7/1998	10/7/2021
72nd and Cicero	11/17/1993	11/17/2016
73rd and Kedzie	11/17/1993	11/17/2016
73rd/University	9/13/2006	12/31/2030
79th and Cicero	6/8/2005	7/8/2021
79th Street Corridor	7/8/1998	12/31/2025
79th Street/Southwest Highway	10/3/2001	12/31/2029
79th/Vincennes	9/27/2007	12/31/2031
83rd/Stewart	3/31/2004	12/31/2028
87th/Cottage Grove	11/13/2002	12/31/2026
89th and State	4/1/1998	4/1/2021
95th and Western	7/13/1995	7/13/2018
95th Street and Stony Island	5/16/1990	5/16/2013
Addison Corridor North	6/4/1997	6/4/2020
Addison South	5/9/2007	12/31/2031
Archer Courts	5/12/1999	12/31/2023
Archer/ Central	5/17/2000	12/31/2024
Archer/Western	2/11/2009	12/31/2033
Armitage/Pulaski	6/13/2007	12/31/2031
Austin/Commercial	9/27/2007	12/31/2031
Avalon Park/South Shore	7/31/2002	12/31/2026
Avondale	7/29/2009	12/31/2033
Belmont/ Central	1/12/2000	12/31/2024
Belmont/Cicero	1/12/2000	12/31/2024
Bronzeville	11/4/1998	12/31/2022
Bryn Mawr/Broadway	12/11/1996	12/11/2019
Calumet Avenue/Cermak Road	7/29/1998	7/29/2021
Calumet River	3/10/210	12/31/2034
Canal/Congress	11/12/1998	12/31/2022
Central West	2/16/2000	12/31/2024
Chatham-Ridge	12/18/1986	12/31/2010 (1)
Chicago/ Kingsbury	4/12/2000	12/31/2024
Chicago/Central Park	2/27/2002	12/31/2026
Chicago Lakeside Development - Phase 1 (USX)	5/12/2010	12/31/2034
Chinatown Basin	12/18/1986	12/31/2010
Cicero/Archer	5/17/2000	12/31/2024
Clark Street and Ridge Avenue	9/29/1999	9/29/2022
Clark/Montrose	7/7/1999	7/7/2022
Commercial Avenue	11/13/2002	12/31/2026
Devon/Sheridan	3/31/2004	12/31/2028

(1) This TIF has been terminated; however, the sales tax portion continues to exist for the sole purpose of servicing outstanding obligations which may be retired early at which point the sales tax portion will also terminate.

ANNUAL TAX INCREMENT FINANCE REPORT OFFICE OF ILLINOIS COMPTROLLER JUDY BAAR TOPINKA

Name of Municipality; Chicago Reporting Fiscal Year: 2010

County:Cook Fiscal Year End: 12/31 /2010

UnitCode: 016/620/30

Devon/Western	11/3/1999	12/31/2023
Diversey/ Narragansett	2/5/2003	12/31/2027
Divlslon/Homan	6/27/2001	12/31/2025
Division/North Branch	3/15/1991	3/15/2014
Division-Hooker	7/10/1996	7/10/2019
Drexel Boulevard	7/10/2002	12/31/2026
Eastman/North Branch	10/7/1993	10/7/2016
Edgewater	12/18/1986	12/18/2009
Edgewater/Ashland	10/1/2003	12/31/2027
Elston/Armstrong Industrial Corridor	7/19/2007	12/31/2031
Englewood Mall	11/29/1989	11/29/2012
Englewood Neighborhood	6/27/2001	12/31/2025
Ewing Avenue	3/10/2010	12/31/2034
Forty-first Street and Dr. Martin Luther King, Jr. Drive	7/13/1994	7/13/2017
Fuilerton/ Milwaukee	2/16/2000	12/31/2024
Galewood/Armitage Industrial	7/7/1999	7/7/2022
Goose Island	7/10/1996	7/10/2019
Greater Southwest Industrial Corridor (East)	3/10/1999	12/31/2023
Greater Southwest Industrial Corridor (West)	4/12/2000	12/31/2024
Harlem Industrial Park Conservation Area	3/14/2007	12/31/2031
Harrison/Central	7/26/2006	12/31/2030
Hollywood/Sheridan	11/7/2007	12/31/2031
Homan/Grand Trunk	12/15/1993	12/15/2016
Homan-Arthington	2/5/1998	2/5/2021
Howard-Paulina	10/14/1988	10/14/2011
Humboldt Park Commercial	6/27/2001	12/31/2025
Irving Park/Elston	5/13/2009	12/31/2033
Irving/Cicero	6/10/1996	12/31/2020
Jefferson Park Business District	9/9/1998	9/9/2021
Jefferson/ Roosevelt	8/30/2000	12/31/2024
Kennedy/Kimball	3/12/2008	3/12/2032
Klnzle Industrial Corridor	6/10/1998	6/10/2021
Kostner Avenue	11/5/2008	11/5/2032
Lake Calumet Area Industrial	12/13/2000	12/31/2024
Lakefront	3/27/2002	12/31/2026
Lakeside/Clarendon	7/21/2004	12/31/2028
LaSalle Central	11/15/2006	12/31/2030
Lawrence/ Kedzie	2/16/2000	12/31/2024
Lawrence/Broadway	6/27/2001	12/31/2025
Lawrence/Pulaski	2/27/2002	12/31/2026
Lincoln Avenue	11/3/1999	12/31/2023
Lincoln-Belmont-Ashland	11/2/1994	11/2/2017
Little Village East	4/22/2009	12/31/2033
Little Village Industrial Corridor	6/13/2007	12/31/2031

C OM RTROLLER wyiw/ioonna,1l w'

ANNUAL TAX INCREMENT FINANCE REPORT OFFICE OF ILLINOIS COMPTROLLER JUDY BAAR TOPINKA

Name of Municipality: Chicago Reporting Fiscal Year: 2010

County:Cook Fiscal Year End: 12/31 /2010

UnitCode: 016/620/30

Madden/Wells	11/6/2002	12/31/2026
Madison/Austin Corridor	9/29/1999	12/31/2023
Mlchigan/Cermak	9/13/1989	9/13/2012
Midway Industrial Corridor	2/16/2000	12/31/2024
Midwest	5/17/2000	12/31/2024
Montclare	8/30/2000	12/31/2024
Montrose/Clarendon	6/30/2010	12/31/2034
Near North	7/30/1997	7/30/2020
Near South	11/28/1990	12/31/2014
Near West	3/23/1989	12/31/2013
North Branch (North)	7/2/1997	12/31/2021
North Branch (South)	2/5/1998	2/5/2021
North Pullman	6/30/2009	12/31/2033
North-Cicero	7/30/1997	7/30/2020
Northwest Industrial Corridor	12/2/1998	12/2/2021
Ogden/Pulaskl	4/9/2008	4/9/2032
Ohio/Wabash	6/7/2000	12/31/2024
Pershing/King	9/5/2007	12/31/2031
Peterson/ Cicero	2/16/2000	12/31/2024
Peterson/ Pulaski	2/16/2000	12/31/2024
Pllsen Industrial Corridor	6/10/1998	12/31/2022
Portage Park	9/9/1998	9/9/2021
Pratt/Ridge Industrial Park Conservation Area	6/23/2004	12/31/2028
Pulaski Corridor	6/9/1999	6/9/2022
Randolph and Wells	6/9/2010	12/31/2034
Ravenswood Corridor	3/9/2005	12/31/2029
Read-Dunning	1/11/1991	12/31/2015
River South	7/30/1997	7/30/2020
River West	1/10/2001	12/31/2025
Roosevelt/Canal	3/19/1997	12/31/2021
Roosevelt/Cicero	2/5/1998	2/5/2021
Roosevelt/Racine	11/4/1998	12/31/2022
Roosevelt/Union	5/12/1999	5/12/2022
Roosevelt-Homan	12/5/1990	12/5/2013
Roseland/Mlchigan	1/16/2002	12/31/2026
Sanitary Drainage and Ship Canal	7/24/1991	7/24/2014
South Chicago	4/12/2000	12/31/2024
South Works Industrial	11/3/1999	12/31/2023
Stevenson/Brighton	4/11/2007	12/31/2031
Stockyards Annex	12/11/1996	12/31/2020
Stockyards Industrial Commercial	3/9/1989	3/9/2012
Stockyards Southeast Quadrant Industrial	2/26/1992	2/26/2015
Stony Island Avenue Commercial and Burnslde Industrial Corridors	6/10/1998	6/10/2021
Touhy/Western	9/13/2006	12/31/2030

COMPTROLLER

ANNUAL TAX INCREMENT FINANCE REPORT OFFICE OF ILLINOIS COMPTROLLER JUDY BAAR TOPINKA

Name of Municipality: Chicago Reporting Fiscal Year: 2010

County:Cook Fiscal Year End: 12/31 /2010

UnitCode: 016/620/30

Weed/Fremont	1/8/2008	1/8/2032
West Grand	6/10/1996	6/10/2019
West Irving Park	1/12/2000	12/31/2024
West Pullman Industrial Park	3/11/1998	3/11/2021
West Ridge-Peterson Avenue	10/27/1986	12/31/2010
West Woodlawn	5/12/2010	12/31/2034
Western Avenue North	1/12/2000	12/31/2024
Western Avenue Rock Island	2/8/2006	12/31/2024
Western Avenue South	1/12/2000	12/31/2030
Western/Ogden	2/5/1998	2/5/2021
Wilson Yard	6/27/2001	12/31/2025
Woodlawn	1/20/1999	1/20/2022

COMPTROLLER ■^wJoonatt.BfW.'

SECTION 2 [Sections 2 through 5 must be completed for each redevelopment project area listed in Section 1.]

Name of Redevelopment Project Area: Addison South Redevelopment Project Area_

Primary Use of Redevelopment Project Area*: Combination/Mixed__

If "Combination/Mixed" List Component Types: Commercial/lndustrial/Residential/Public

Facilities_

Under which section of the Illinois Municipal Code was Redevelopment Project Area designated? (check one): Tax Increment Allocation Redevelopment Act X _Industrial Jobs Recovery Law _

	No	Yes
Were there any amendments to the redevelopment plan, the redevelopment project area, or the State Sales Tax Boundary? [65 ILCS 5/11-74.4-5 (d) (1) and 5/11-74.6-22 (d) (1)] If ves, please enclose the amendment labeled Attachment A	X
Certification of the Chief Executive Officer of the municipality that the municipality has complied with all of the requirements of the Act during the preceding fiscal year. [65 ILCS 5/11-74.4-5 (d) (3) and 5/11-74.6-22 (d) (3)] Please enclose the CEO Certification labeled Attachment B	\|	X
Opinion of legal counsel that municipality is in compliance with the Act. [65 ILCS 5/11-74.4-5 (d) (4) and 5/11-74.6-22 (d)(4)] Please enclose the Legal Counsel Opinion labeled Attachment C	'	X
Were there any activities undertaken in furtherance ofthe objectives ofthe redevelopment plan, including any project implemented in the preceding fiscal year and a description of the activities undertaken? [65 ILCS 5/11-74.4-5 (d) (7) (A and B) and 5/11-74.6-22 (d) (7) (A and B)] If ves, please enclose the Activities Statement labeled Attachment D		X
Were any agreements entered into by the municipality with regard to the disposition or redevelopment of any property within the redevelopment project area or the area within the State Sales Tax Boundary? [65 ILCS 5/11-74.4-5 (d) (7) (C) and 5/11-74.6-22 (d) (7) (C)] If yes, please enclose the Aqreement(s) labeled Attachment E		X
Is there additional information on the use of all funds received under this Division and steps taken by the municipality to achieve the objectives of the redevelopment plan? [65 ILCS 5/11-74.4-5 (d) (7) (D) and 5/11-74.6-22 (d) (7) (D)j If yes, please enclose the Additional Information labeled Attachment F		X
Did the municipality's TIF advisors or consultants enter into contracts with entities or persons that have received or are receiving payments financed by tax increment revenues produced by the same TIF? [65 ILCS 5/11-74.4-5 (d) (7) (E) and 5/11-74.6-22 (d) (7) (E)] If yes, please enclose the contract(s) or description ofthe contract(s) labeled Attachment G	X
Were there any reports or meeting minutes submitted to the municipality by the joint review board? [65 ILCS 5/11-74.4-5 (d) (7) (F) and 5/11-74.6-22 (d) (7) (F)] If yes, please enclose the Joint Review Board Report labeled Attachment H	X
Were any obligations issued by municipality? [65 ILCS 5/11-74.4-5 (d) (8) (A) and 5/11-74.6-22 (d) (8) (A)] If yes, please enclose the Official Statement labeled Attachment 1	X
Was analysis prepared by a financial advisor or underwriter setting forth the nature and term of obligation and projected debt service including required reserves and debt coverage? [65 ILCS 5/11-74.4-5 (d) (8) (B) and 5/11-74.6-22 (d) (8) (B)] If yes, please enclose the Analysis labeled Attachment J	X
Cumulatively, have deposits equal or greater than $100,000 been made into the special tax allocation fund? 65 ILCS 5/11-74.4-5 (d) (2) and 5/11-74.6-22 (d) (2) If yes, please enclose Audited financial statements of the special tax allocation fund labeled Attachment K		X
Cumulatively, have deposits of incremental revenue equal to or greater than $100,000 been made into the special tax allocation fund? [65 ILCS 5/11-74.4-5 (d) (9) and 5/11-74.6-22 (d) (9)] If yes, please enclose a certified letter statement reviewing compliance with the Act labeled Attachment L		X
A list ot all intergovernmental agreements in effect in FY 2U1U, to which the municipality is a part, and an accounting of any money transferred or received by the municipality during that fiscal year pursuant to those intergovernmental agreements. [65 ILCS 5/11-74.4-5 (d) (10)] If yes, please enclose list only ofthe intergovernmental agreements labeled Attachment WI		X

* Types include: Central Business District, Retail, Other Commercial, Industrial, Residential, and Combination/Mixed. FY 2010 Section 2

SECTION 3.1 - (65 ILCS 5/11-74.4-5 (d) (5) and 65 ILCS 5/11-74.6-22 (d) (5)) Provide an analysis ofthe special tax allocation fund.

Reporting Year | Cumulative'

Fund Balance at Beginning of Reporting Period Revenue/Cash Receipts Deposited in Fund During Reporting FY:

| $ 2,917,500 |

			% of Total
Property Tax Increment	2,451,158	$ 5,413,288	100%
State Sales Tax Increment			0%
Local Sales Tax Increment			0%
State Utility Tax Increment			0%
Local Utility Tax Increment			0%
Interest	3,514		0%
Land/Building Sale Proceeds			0%
Bond Proceeds			0%
Transfers in from Municipal Sources (Porting in)			0%
Private Sources			0%
Other (identify source : if multiple other sources, attach schedule)			0%

Total Amount Deposited in Special Tax Allocation Fund During Reporting Period

Cumulative Total Revenues/Cash Receipts

Total Expenditures/Cash Disbursements (Carried forward from Section 3.2)

Transfers out to Municipal Sources (Porting out)

Distribution of Surplus

Total Expenditures/Disbursements

NET INCOME/CASH RECEIPTS OVER/(UNDER) CASH DISBURSEMENTS FUND BALANCE, END OF REPORTING PERIOD

| 2,454^6721

| $ 5,413,288 | 100%1

94,361

2,360,311

$ 5,277,811

- if there is a positive fund balance at the end ofthe reporting period, you must complete Section 3.3

* Except as set forth in the next sentence, each amount reported on the rows below, if any, is cumulative from the inception of the respective Project Area. Cumulative figures for the categories of 'Interest,' 'Land/Building Sale Proceeds' and 'Other' may not be fully available for this report due to either of the following: (i) the disposal of certain older records pursuant to the City's records retention policy, or (ii) the availability of records only from January 1, 1997 forward.

FY 2010

TIF Name: Addison South Redevelopment Proiect Area

SECTION 3.2 A- (65 ILCS 5/11-74.4-5 (d) (5) and 65 ILCS 5/11-74.6-22 (d) (5))

ITEMIZED LIST OF ALL EXPENDITURES FROM THE SPECIAL TAX ALLOCATION FUND

(by category of permissible redevelopment cost, amounts expended during reporting period)

FOR AMOUNTS >$10,000 SECTION 3.2 B MUST BE COMPLETED

Category of Permissible Redevelopment Cost [65 ILCS 5/11-74.4-3 (q) and 65 ILCS 5/11-74.6-10 (o)]

Reporting Fiscal Year

1. Costs of studies, administration and professional servicesSubsections (q)(1) and (o) (1)	11 * ->* i T
	94,361	S f if.. ~
		H'i} T 7 r A fit





		$ 94.361
2. Cost of marketing sitesSubsections (q)(1.6) and (o)(1.6)





		<. f * «■

		$
3. Property assembly, demolition, site preparation and environmental site improvement costs. Subsection (q)(2), (o)(2) and (o)(3)		'i ¹ it f "l


		» i V ',



		«- - ( 1 t'V»
		$
4. Costs of rehabilitation, reconstruction, repair or remodeling and replacement of existing public buildings. Subsection (q)(3) and (o)(4)
		i ! ft * » Is

		_q ** ^ _fr * * \ p
		us * a i ^K * >
		^M? 1- & i ' 3


		$
5. Costs of construction of public works and improvements. Subsection (q)(4) and (o)(5)


		f ? fin* 3




		$
6. Costs of removing contaminants required by environmental laws or rules (o)(6) - Industrial Jobs Recovery TIFs ONLY




		j


		$

FY 2010

TIF Name: Addison South Redevelopment Proiect Area

7. Cost of job training and retraining, including "welfare to work" programs Subsection (q)(5), (o)(7) and (o)(12)		. ¹ « ^y





		⁵

		$
8. Financing costs. Subsection (q) (6) and (o)(8)





		" « ' ' ,i '


9. Approved capital costs. Subsection (q)(7) and (o)(9)






		_f
		$
10, Cost of Reimbursing school districts for their increased costs caused by TIF assisted housing projects. Subsection (q)(7.5) - Tax Increment Allocation Redevelopment TIFs ONLY



		r \| » ... ✓ >
		, ,* -T '


		$
11. Relocation costs. Subsection (q)(8) and (o)(10)
		4 1 « .
		t *
		t-i?


		7

		$
12. Payments in lieu of taxes. Subsection (q)(9) and (o)(11)






		t
		$
13. Costs of job training, retraining advanced vocational or career education provided by other taxing bodies. Subsection (q)(10) and (o)(12)		r







		$

FY 2010

TIF Name: Addison South Redevelopment Proiect Area

14. Costs of reimbursing private developers for interest expenses incurred on approved redevelopment projects. Subsection (q)(11)(A-E) and (o)(13)(A-E)
		« ^ f i >

		■C » f ! V ^




		$
15, Costs of construction of new housing units for low income and very low-income households Subsection (q)(11)(F) - Tax Increment Allocation Redevelopment TIFs ONLY	" if	t ' 1» *>_ iV V

		i
		i



		■*
		$
16, Cost of day care services and operational costs of day care centers. Subsection (q) (11.5) -Tax Increment Allocation Redevelopment TIFs ONLY
		1





		< >
		$

I TOTAL ITEMIZED EXPENDITURES | I $ 94,3671

FY 2010

TIF Name: Addison South Redevelopment Proiect Area

Section 3.2 B

List all vendors, including other municipal funds, that were paid in excess of $10,000 during the current reporting year.*

Name	Service	Amount
S.B. Friedman & Company	Professional Service	$52,790

* This table may include payments for Projects that were undertaken prior to 11/1/1999.

FY 2010

TIF Name: Addison South Redevelopment Proiect Area

SECTION 3.3 - (65 ILCS 5/11-74.4-5 (d) (5) 65 ILCS 11-74.6-22 (d) (5))

Breakdown of the Balance in the Special Tax Allocation Fund At the End of the Reporting Period (65 ILCS 5/11-74.4-5 (d) (5) (D) and 65 ILCS 5/11-74.6-22 (d) (5) (D))

FUND BALANCE, END OF REPORTING PERIOD

1. Description of Debt Obligations

5,277,811

Amount of Original Issuance

Amount Designated

Reserved for debt service	$	$

Total Amount Designated for Obligations

Designated for future redevelopment project costs		$ 5,277,811

Total Amount Designated for Project Costs

TOTAL AMOUNT DESIGNATED SURPLUS*/(DEFICIT)

5,277,811 5,277,811

*NOTE: If a surplus is calculated, the municipality may be required to repay the amount to overlapping taxing districts.

FY 2010

TIF Name: Addison South Redevelopment Proiect Area

SECTION 4 [65 ILCS 5/11-74.4-5 (d) (6) and 65 ILCS 5/11-74.6-22 (d) (6)]

Provide a description of all property purchased by the municipality during the reporting fiscal year within the redevelopment project area.

X No property was acquired by the Municipality Within the Redevelopment Project Area

FY 2010

TIF Name: Addison South Redevelopment Project Area

SECTION 5 - 65 ILCS 5/11-74.4-5 (d) (7) (G) and 65 ILCS 5/11-74.6-22 (d) (7) (G)

Please include a brief description of each project.

See "General Notes" Below.

11/1/99 to Date

Estimated Investment for Subsequent Fiscal Year

Total Estimated to Complete Project

TOTAL:
Private Investment Undertaken	$			$				$ 45,250,742
Public Investment Undertaken	$			$ 1,366,666				$ 11,250,000
Ratio of Private/Public Investment	0							4 1/45
Project 1: Small Business Improvement Fund (SBIF) **		Project is Ongoing ***
Private Investment Undertaken									$ 2,000,000
Public Investment Undertaken		$			$ 333,333				$ 1,000,000
Ratio of Private/Public Investment		0							2
Project 2: Green Exchange (Cooper Lamp Building)		Project is Ongoing ***
Private Investment Undertaken									$ 42,750,742
Public Investment Undertaken						$ 950,000			$ 10,000,000
Ratio of Private/Public Investment		0							4 11/40
Project 3: Neighborhood Improvement Fund (NIF) **			Project is Ongoing ***
Private Investment Undertaken										$ 500,000
Public Investment Undertaken							$ 83,333			$ 250,000
Ratio of Private/Public Investment			0							2

** Depending on the particular goals of this type of program, the City may: i) make an advance disbursement of the entire public investment amount to the City's program administrator, ii) disburse the amounts through an escrow account, or iii) pay the funds out piecemeal to the program administrator as each ultimate grantee's rehabilitation work is approved under the program.

*** As of the last date ofthe reporting fiscal year, the construction of this Project was ongoing; the Private Investment Undertaken and Ratio figures for this Project will be reported on the Annual Report for the fiscal year in which the construction ofthe Project is completed and the total Private Investment figure is available.

General Notes

(a) Each actual or estimated Public Investment reported here is, to the extent possible, comprised only of payments financed by tax increment revenues. In contrast, each actual or estimated Private Investment reported here is, to the extent possible, comprised of payments financed by revenues that are not tax increment revenues and, therefore, may include private equity, private lender financing, private grants, other public monies, or other local, state or federal grants or loans.

(b) Each amount reported here under Public Investment Undertaken, Total Estimated to Complete Project, is the maximum amount of payments financed by tax increment revenues that could be made pursuant to the corresponding Project's operating documents, but not including interest that may later be payable on developer notes, and may not necessarily reflect actual expenditures, if any, as reported in Section 3 herein. The total public investment amount ultimately made under each Project will depend upon the future occurrence of various conditions, including interest that may be payable on developer notes as set forth in the Project's operating documents.

(c) Each amount reported here under Public Investment Undertaken, 11/1/1999 to Date, is cumulative from the Date of execution of the corresponding Project to the end of the reporting year, and may include interest amounts paid to finance the Public Investment amount, Projects undertaken prior to

11/1/1999 are not reported on this table.

(d) Intergovernmental agreements, if any, are reported on Attachment M hereto.

FY 2010

TIF Name: Addison South Redevelopment Proiect Area

STATE OF ILLINOIS COUNTY OF COOK

)

) ss

)

Attachment B

CERTI

TO:

Judy Baar Topinka

Comptroller of the State of Illinois

James R. Thompson Center

100 West Randolph Street, Suite 15-500

Chicago, Illinois 60601

Attention: June Canello, Director of Local

Government

Dolores Javier, Treasurer

City Colleges of Chicago

226 West Jackson Boulevard, Room 1125

Chicago, Illinois 60606

Herman Brewer Director

Cook County Bureau of Planning & Dev. 69 West Washington Street, Suite 2900 Chicago, Illinois 60602

IC ATION

Jean-Claude Brizard Chief Executive Officer Chicago Board of Education 125 South Clark Street, 5th Floor Chicago, Illinois 60603

Jacqueline Torres, Director of Finance Metropolitan Water Reclamation District of Greater Chicago 100 East Erie Street, Room 2429 Chicago, Illinois 60611

Douglas Wright

South Cook County Mosquito Abatement District

155th & Dixie Highway P.O.Box 1030 Harvey, Illinois 60426

Dan Donovan, Comptroller Forest Preserve District of Cook County 69 W. Washington Street, Suite 2060 Chicago, IL 60602

Michael P. Kelly, Interim General Superintendent & CEO Chicago Park District 541 North Fairbanks Chicago, Illinois 60611

I, Rahm Emanuel, in connection with the annual report (the "Report") of information required by Section 1 l-74.4-5(d) ofthe Tax Increment Allocation Redevelopment Act, 65 ILCS5/11-74.4-1 ct seq, (the "Act") with regard to the Addison South Redevelopment Project Area (the "Redevelopment Project Area"), do hereby certify as follows:

Attachment B

1. I am the duly qualified and acting Mayor of the City of Chicago, Illinois (the "City") and, as such, I am the City's Chief Executive Officer. This Certification is being given by me in such capacity.

2. During the preceding fiscal year of the City, being January 1 through December 31, 2010, the City complied, in all material respects, with the requirements of the Act, as applicable from time to time, regarding the Redevelopment Project Area.

3. In giving this Certification, I have relied on the opinion of the Corporation Counsel of the City furnished in connection with the Report.

4. This Certification may be relied upon only by the addressees hereof.

IN WITNESS WHEREOF, I have hereunto affixed my official signature as of this 30th day of June, 2011.

Rahm Emanuel, Mayor City of Chicago, Illinois

June 30, 2011

Department of Law city of chicago

Attachment C

Judy Baar Topinka

Comptroller of the State of Illinois

James R. Thompson Center

100 West Randolph Street, Suite 15-500

Chicago, Illinois 60601

Attention: June Canello, Director of Local

Government

Jean-Claude Brizard Chief Executive Officer Chicago Board of Education 125 South Clark Street, 5th Floor Chicago, Illinois 60603

Dolores Javier, Treasurer

City Colleges of Chicago

226 West Jackson Boulevard, Room 1125

Chicago, Illinois 60606

Jacqueline Torres, Director of Finance Metropolitan Water Reclamation District of Greater Chicago 100 East Erie Street, Room 2429 Chicago, Illinois 60611

Herman Brewer Director

Cook County Bureau of Planning & Dev. 69 West Washington Street, Suite 2900 Chicago, Illinois 60602

Douglas Wright

South Cook County Mosquito Abatement District

155th & Dixie Highway P.O.Box 1030 Harvey, Illinois 60426

Dan Donovan, Comptroller Forest Preserve District of Cook County 69 W. Washington Street, Suite 2060 Chicago, IL 60602

Michael P. Kelly, Interim General Superintendent & CEO Chicago Park District 541 North Fairbanks Chicago, Illinois 60611

Re: Addison South

Redevelopment Project Area (the "Redevelopment Project Area")

Dear Addressees:

I am the Corporation Counsel ofthe City of Chicago, Illinois (the "City") and, in such capacity, I am the head of the City's Law Department. Li such capacity, I am providing the opinion required by Section 1 l-74.4-5(d)(4) of the Tax Increment Allocation Redevelopment Act, 65 ILCS 5/11-74.4-1 et seq. (the "Act"), in connection with the submission ofthe report (the "Report") in accordance with, and containing the information required by, Section ll-74.4-5(d) ofthe Act for the Redevelopment Project Area.

I a l NORTH LASALLE STREET, ROOM 600, CHICAGO, ILLINOIS 60602

Attachment C

Opinion of Counsel for 2010 Annual Report Page 2

June 30, 2011

Attorneys, past and present, in the Law Department of the City and familiar with the requirements of the Act, have had general involvement in the proceedings affecting the Redevelopment Project Area, including the preparation of ordinances adopted by the City Council of the City with respect to the following matters: approval of the redevelopment plan and project for the Redevelopment Project Area, designation ofthe Redevelopment Project Area as a redevelopment project area, and adoption of tax increment allocation financing for the Redevelopment Project Area, all in accordance with the then applicable provisions of the Act. Various departments of the City, including, if applicable, the Law Department, Department of Housing and Economic Development, Department of Finance and Office of Budget and Management (collectively, the "City Departments"), have personnel responsible for and familiar with the activities in the Redevelopment Project Area affecting such Department(s) and with the requirements of the Act in connection therewith. Such personnel are encouraged to seek and obtain, and do seek and obtain, the legal guidance of the Law Department with respect to issues that may arise from time to time regarding the requirements of, and compliance with, the Act.

In my capacity as Corporation Counsel, I have relied on the general knowledge and actions of the appropriately designated and trained staff of the Law Department and other applicable City Departments involved with the activities affecting the Redevelopment Project Area. In addition, I have caused to be examined or reviewed by members of the Law Department of the City the certified audit report, to the extent required to be obtained by Section 1 l-74.4-5(d)(9) of the Act and submitted as part of the Report, which is required to review compliance with the Act in certain respects, to determine if such audit report contains information that might affect my opinion. I have also caused to be examined or reviewed such other documents and records as were deemed necessary to enable me to render this opinion. Nothing has come to my attention that would result in my need to qualify the opinion hereinafter expressed, subject to the limitations hereinafter set forth, unless and except to the extent set forth in an Exception Schedule attached hereto as Schedule 1.

Based on the foregoing, I am of the opinion that, in all material respects, the City is in compliance with the provisions and requirements of the Act in effect and then applicable at the time actions were taken from time to time with respect to the Redevelopment Project Area.

This opinion is given in an official capacity and not personally and no personal liability shall derive herefrom. Furthermore, the only opinion that is expressed is the opinion specifically set forth herein, and no opinion is implied or should be inferred as to any other matter. Further, this opinion may be relied upon only by the addressees hereof and the Mayor of the City in providing his required certification in connection with the Report, and not by any other party.

Stephen R. Patton Corporation Counsel

ATTACHMENT C

SCHEDULE 1 (Exception Schedule)

(X) ( )

No Exceptions

Note the following Exceptions:

ATTACHMENTS D, E and F

ATTACHMENT D

Activities Statement

Projects that were implemented during the preceding fiscal year, if any, are set forth below:

Name of Proiect_

Green Exchange_

Neighorhood Improvement Fund_

Small Business Improvement Fund_

Redevelopment activities undertaken within this Project Area during the preceding fiscal year, if any, have been made pursuant to: (i) the Redevlopment Plan for the Project Area, and (ii) any Redevelopment Agreements affecting the Project Area, and are set forth in Section 3 herein by TIF-eligible expenditure category.

ATTACHMENT E

Agreements

Agreements entered into concerning the disposition or redevelopment of property within the Project Area during the preceding fiscal year, if any, are attached hereto.

None

ATTACHMENT F Additional Information

The amounts shown elsewhere in this report, including those shown in Section 3 herein, have been used to pay for project cost within the Project Area and for debt service (if applicable), all in furtherance of the objectives of the Redevelopment Plan for the Project Area.

FY 2010

TIF Name: Addison South Redevelopment Proiect Area

ATTACHMENTD

82434 JOURNAL-CITY COUNCIL-CHICAGO 1/13/2010

The following is said ordinance as passed:

Be It Ordained by the City Council of the City of Chicago:

SECTION 1. That the resolution adopted by the City Council on November 25, 2009 and printed on pages 78762 ~ 78763 of the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago congratulating Father Hernando Puentes Torres in his installation as pastor of Saint Philomena Church (Document Number R2009-1396) is hereby amended by including the name and signature of Alderman Suarez as a co-sponsor.

SECTION 2. This ordinance shall be in effect upon its passage.

ESTABLISHMENT OF ADDISON SOUTH SMALL BUSINESS IMPROVEMENT FUND PROGRAM, ISSUANCE OF CITY NOTE, ALLOCATION OF TAX INCREMENT FINANCING AND EXECUTION OF TWENTY-FOURTH AMENDING ADMINISTRATIVE SERVICES AGREEMENT WITH SOMER COR 504, INC.

[O2010-1]

The Committee on Finance submitted the following report:

CHICAGO, January 13, 2010.

To the President and Members of the City Council:

Your Committee on Finance, having had under consideration an ordinance authorizing an amendment to the small business improvement fund program, begs leave to report and recommend that Your Honorable Body Pass the proposed ordinance transmitted herewith.

This recommendation was concurred in by a viva voce vote of the members of the Committee.

Respectfully submitted,

(Signed) EDWARD M. BURKE,

Chairman.

8602835

1/13/2010

REPORTS OF COMMITTEES

82435

On motion of Alderman Burke, the said proposed ordinance transmitted with the foregoing committee report was Passed by yeas and nays as follows:

Yeas -- Aldermen Flores, Fioretti, Dowell, Preckwinkle, Hairston, Lyle, Harris, Beale, Pope, Balcer, Cardenas, Olivo, Burke, Foulkes, Thompson, Thomas, Lane, Ru.gai, Cochran, Brookins, Munoz, Zalewski, Dixon, Solis, Maldonado, Burnett, E. Smith, Carothers, Reboyras, Suarez, Waguespack, Mell, Colon, Rice, Mitts, Laurino, O'Connor, Doherty, Reilly, Daley, Tunney, Shiller, Schulter, M. Smith, Moore, Stone - 46.

Nays None.

Alderman Carothers moved to reconsider the foregoing vote. The motion was lost. The following is said ordinance as passed:

WHEREAS, The City of Chicago ("City"), a home rule unit of government under Section 6(a), Article VII of the 1970 Constitution of the State of Illinois, is authorized under the provisions of the Tax Increment Allocation Redevelopment Act, 65 ILCS 5/11-74.4-1, et seq., as amended from time to time (the "Act"), to finance projects that eradicate blighted conditions and conservation area factors through the use of tax increment allocation financing for redevelopment projects; and

WHEREAS, By an ordinance adopted by the City Council of the City ("City Council") on July 21, 1999, and published in the Journal of the Proceedings ofthe City Council of the City of Chicago ("Journal') for said date at pages 8307 to 8344, inclusive (the "Program Ordinance"), the City implemented a redevelopment program known as the Small Business Improvement Fund program (the "Program") to provide financing assistance pursuant to the Act for the improvement of commercial and industrial facilities of small businesses in certain redevelopment project areas of the City; and

WHEREAS, By ordinances adopted by the City Council, the first on November 8, 2000, and published in the Journal for said date at pages 43877 to 43930, inclusive (the "First Amending Ordinance") and the most recently introduced on November 18, 2009 (the "Twenty-Third Amending Ordinance", collectively with the Program Ordinance, the First Amending Ordinance and the other amending ordinances, the "S.B.I.F. Ordinance"), the City has restated and refined the Program and extended its reach to additional redevelopment project areas of the City; and

WHEREAS, The City Council now desires to extend the Program to the Addison South Redevelopment Project Area of the City ("New T.I.F./S.B.I.F. Area"), which is identified on Exhibit A attached hereto and incorporated herein, and that is not already reached under the S.B.I.F. Ordinance; and

82436

JOURNAL-CITY COUNCIL-CHICAGO

1/13/2010

WHEREAS, The City Council, under the S.B.I.F. Ordinance, authorized D.C.D. to enter into an agreement with SomerCor 504, Inc., an Illinois not-for-profit corporation ("SomerCor"), and D.C.D. entered into such agreement on March 12, 2001, which agreement continues in full force and effect, as amended from time to time, pursuant to which SomerCor performs certain administrative services for the Program, and D.C.D. now desires to further amend that agreement by entering into a twenty-fourth amending agreement (the "Twenty-Fourth Amending Agreement") with SomerCor to (a) extend the Program into the New T.I.F./S.B.I.F Area; and (b) authorize SomerCor to continue providing the same administrative services for the Program, which Twenty-Fourth Amending Agreement is set forth in more detail on Exhibit B attached hereto and incorporated herein; and

WHEREAS, The City's obligation to provide funds under the Twenty-Fourth Amending Agreement may be met through (i) incremental taxes from the New T.I.F./S.B.I.F. Area; (ii) certain proceeds of the City's issuance of tax increment allocation revenue notes to be secured by incremental taxes deposited in the Special Tax Allocation Fund of the New T.I.F./S.B.I.F. Area pursuant to the Act, or (iii) any other funds legally available to the City for this purpose; now, therefore,

Be It Ordained by the City Council of the City of Chicago:

SECTION 1. The above recitals are expressly incorporated in and made a part of this ordinance as though fully set forth herein.

SECTION 2. SomerCor is hereby authorized to administer the Program in the New T.I.F./S.B.I.F. Area, subject to the supervision of D.C.D.

SECTION 3. The Commissioner (or Acting Commissioner) of D.C.D. or a designee ofthe Commissioner are each hereby authorized, with the approval of the City's Corporation Counsel as to legal form, to negotiate, execute and deliver the Twenty-Fourth Amending Agreement between SomerCor and the City substantially in the form attached hereto, as Exhibit B and made a part hereof, and such other supporting documents as may be necessary to carry out and comply with the provisions of the Twenty-Fourth Amending Agreement, with such changes, deletions and insertions as shall be approved by the persons executing the Twenty-Fourth Amending Agreement.

SECTION 4. The proceeds of the tax increment allocation revenue notes issued by the City to fund the Program in the New T.I.F./S.B.I.F. Area, and secured by incremental taxes deposited in the Special Tax Allocation Fund of the New T.I.F./S.B.I.F. Area pursuant to the Act, if any, are hereby appropriated for the purposes set forth herein.

SECTION 5. To the extent that any ordinance, resolution, rule, order or provision of the Municipal Code of Chicago, or part thereof, is in conflict with the provisions of this ordinance, the provisions of this ordinance shall control. All sections ofthe S.B.I.F. Ordinance in conflict with this ordinance are hereby repealed to the extent of such conflict. If any section, paragraph, clause or provision of this ordinance shall be held invalid, the invalidity of such section, paragraph, clause or provision shall not affect any of the other provisions of this ordinance.

1/13/2010

REPORTS OF COMMITTEES

82437

SECTION 6. This ordinance shall be effective as of the date of its passage.

Exhibits "A" and "B" referred to in this ordinance read as follows:

Exhibit "A". (To Ordinance)

Description Of New T.I.F./S.B.I.F. Area.

The following NewT.I.F./S.B.I.F. Area was created pursuant to the ordinances listed below:

on May 9, 2007: (1) "An Ordinance of the City of Chicago, Illinois Approving a Redevelopment Plan for the Addison South Redevelopment Project Area"; (2) "An Ordinance of the City of Chicago, Illinois Designating the Addison South Redevelopment Project Area as a Redevelopment Project Area Pursuant to the Tax Increment Allocation Redevelopment Act"; and (3) "An Ordinance of the City of Chicago, Illinois Adopting Tax Increment Allocation Financing for the Addison South Redevelopment Project Area".

Exhibit "B". (To Ordinance)

Twenty-Fourth Amending Agreement To Administrative Services Agreement.

This Twenty-Fourth Amending Agreement to Administrative Services Agreement (the

"Agreement") is made this _ day of_, 2010, by and between the City of Chicago,

a municipal corporation and home rule unit of local government existing under the 1970 Constitution ofthe State of Illinois (the "City"), acting through its Department of Community Development ("D.C.D."), and SomerCor 504, Inc., an Illinois not-for-profit corporation ("SomerCor") whose office address is Two East Eighth Street, Chicago, Illinois 60605 and whose federal tax identification number is [omitted for printing purposes].

Whereas, The City is authorized under the provisions of the Tax Increment Allocation Redevelopment Act, 65 ILCS 5/11-74.4-1, et seq., as amended from time to time (the "Act"), to finance projects that eradicate blighted conditions and conservation area factors through the use of tax increment allocation financing for redevelopment projects; and

Whereas, By ordinances adopted by the City Council ofthe City on July 21, 1999 and on November8, 2000, and published in the Journal of the Proceedings ofthe City Council of the City of Chicago for said dates at pages 8307 to 8344, inclusive, and pages 43877 - 43930,

82438

JOURNAL-CITY COUNCIL-CHICAGO 1/13/2010

inclusive, respectively (the "S.BJ.F. Ordinances"), the City implemented and amended a redevelopment program known as the Small Business Improvement Fund program (the "S.B.I.F. Program") to provide financing assistance pursuant to the Act for the improvement of commercial and industrial facilities of small businesses in certain redevelopment project areas ("T.I.F. Areas") in the City; and

Whereas, The City Council, under the S.B.I.F. Ordinances, authorized D.C.D. to enter into agreements with SomerCor, and D.C.D. and SomerCor entered into one agreement on September 22, 1999 ("First SomerCor Agreement") and another agreement on March 12, 2001 ("Second SomerCor Agreement"), to administer the S.B.I.F. Programs on behalf of the City; and

Whereas, In an ordinance adopted by the City Council on October 31, 2001 and published in the Journal of the Proceedings of the City Council of the City of Chicago for said date at pages 69965through 70047, inclusive (the "Midwest T.I.F. Area Ordinance"), the City Council authorized D.C.D. to enter into an agreement amending the Second SomerCor Agreement with SomerCor to enable SomerCor to provide S.B.I.F. Program administrative services in the Midwest T.I.F. Area (the "Midwest T.I.F. Area Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on May 1, 2002, and published in the Journal ofthe Proceedings of the City Council ofthe City of Chicago for said date at pages 83769 to 83781, inclusive ("Second Amending Ordinance"), the City Council authorized D.C.D. to enter into an agreement amending the Second SomerCor Agreement with SomerCor to enable SomerCor to provide S.B.I.F. Program administrative services in the Portage Park, Western Avenue North, Western Avenue South, Fullerton/Milwaukee and Belmont/Central T.I.F. Areas (the "Second Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on December 4, 2002 and published in the Journal of the Proceedings ofthe City Council of the City of Chicago for said date at pages 100124 to 100135, inclusive ("Third Amending Ordinance"), the City Council authorized D.C.D. to enter into an agreement amending the Second SomerCor Agreement with SomerCor to enable SomerCor to provide S.B.I.F. Program administrative services in the Madison/Austin Corridor and Humboldt Park Commercial T.I.F. Areas (the "Third Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on February 5, 2003 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago for said date at pages 102793 to 102803, inclusive ("Fourth Amending Ordinance"), the City Council authorized D.C.D. to enter into an agreement amending the Second SomerCor Agreement with SomerCor to enable SomerCor to provide S.B.I.F. Program administrative services in the Northwest Industrial Corridor Redevelopment Project Area (the "Fourth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on July 9, 2003 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago for said date at pages 3418 to 3424, inclusive ("Fifth Amending Ordinance"), the City Council authorized D.C.D. to enter into an agreement amending the Second SomerCor Agreement

1/13/2010

REPORTS OF COMMITTEES

82439

with SomerCor which restated the S.B.I.F. Program rules (the "Fifth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on November 3, 2004 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicagotor said date at pages 34545 to 34554, inclusive ("Sixth Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to the Lawrence/Kedzie Redevelopment Project Area of the City (the "Sixth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on September 14, 2005 and published in the Journal ofthe Proceedings ofthe City Council of the City of Chicago tor said date at pages 54724 to 54740, inclusive ("Seventh Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to the ■63^,d/Pulaski, Belmont/Cicero, Lawrence/Pulaski, Peterson/Pulaski, West Irving Park, Greater Southwest-West, Galewood/Armitage Industrial, . Pilsen Industrial Corridor, 119^th and Halsted, and Pulaski Corridor Redevelopment Project Areas of the City and increased the amount of grant funds available in the Fullerton/Milwaukee Redevelopment Project Area and the Lawrence/Kedzie Redevelopment Project Area (the "Seventh Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on September 13, 2006 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago tor said date at pages 83420 to 83440, inclusive ("Eighth Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to twenty-one (21) redevelopment project areas of the City (the "Eighth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on February 7, 2007 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago tor said date at pages 97661 to 97672, inclusive ("Ninth Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to the 63^rd/Ashland and DevonAA/estern Redevelopment Project Areas of the City (the "Ninth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council ofthe City on June 13, 2007 and published in the Journal ofthe Proceedings of the City Council of the City of Chicago tor said date at pages 2395 to 2402, inclusive ("Tenth Amending Ordinance"), the City Council authorized D.C.D. to enter into an agreement amending the Second SomerCor Agreement with SomerCor which restated the S.B.I.F. Program rules (the "Tenth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on October 31, 2007 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago tor said date at pages 10929to 10942, inclusive ("Eleventh Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to certain redevelopment project areas of the City (the "Eleventh Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on June 11, 2008 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago tor said date at pages 28833 to 28843, inclusive ("Twelfth Amending Ordinance"), D.C.D. extended

82440

JOURNAL-CITY COUNCIL-CHICAGO

1/13/2010

the S.B.I.F. Program to the Michigan/Cermak Redevelopment Project Area of the City (the "Twelfth Amending Agreement); and

Whereas, By an ordinance adopted by the City Council of the City on September 10, 2008 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago for said date at pages 36267 to 36277, inclusive ("Thirteenth Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to the Irving/Cicero Redevelopment Project Area of the City (the "Thirteenth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on September 10, 2008 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago or said date at pages 36704 to 36711, inclusive ("Fourteenth Amending Ordinance"), the City Council authorized D.C.D. to enter into an agreement amending the Second SomerCor Agreement with SomerCor which restated the S.B.I.F. Program rules (the "Fourteenth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council ofthe City on February 11, 2009 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago for said date at pages 54738 to 54748, inclusive ("Fifteenth Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to the Hollywood/Sheridan Redevelopment Project Area ofthe City (the "Fifteenth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on March 18, 2009 and published in the Journal of the Proceedings of the City Council of the City of Chicago for said date at pages 55750 to 55762, inclusive ("Sixteenth Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to the Elston/Armstrong Industrial Corridor Redevelopment Project Area and 47^lh/Ashland Redevelopment Project Area of the City (the "Sixteenth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on April 22, 2009 and published in the Journal ofthe Proceedings ofthe City Council of the City of Chicagotor said date at pages 57265 to 57276, inclusive ("Seventeenth Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to the Lawrence/Broadway Redevelopment Project Area and Touhy/Western Redevelopment Project Area of the City (the "Seventeenth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on May 13, 2009 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago tor said date at pages 60322 to 60333, inclusive ("Eighteenth Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to the Austin Commercial Redevelopment Project Area ofthe City (the "Eighteenth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on June 3, 2009 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago tor said date at pages 63080 to 63090, inclusive ("Nineteenth Amending Ordinance"), D.C.D. increased the amount of grant funds available in the Clark Street and Ridge Avenue Redevelopment Project Area by an additional One Million Dollars ($1,000,000) to a total

1/13/2010

REPORTS OF COMMITTEES

82441

collective amount of One Million Seven Hundred Fifty Thousand Dollars ($1,750,000) (the "Nineteenth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on June 30, 2009 and published in the Journal ofthe Proceedings ofthe City Council of the City of Chicago for said date at pages 64859 to 64871, inclusive ("Twentieth Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to the Midway Industrial Corridor Redevelopment Project Area and increased the amount of grant funds available in the Peterson/Pulaski Redevelopment Project Area by an additional One Million Dollars ($1,000,000) to a total collective amount of One Million Five Hundred Thousand Dollars ($1,500,000) (the "Twentieth Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on September 9, 2009 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicago for said date at pages 69297 to 69308, inclusive ("Twenty-First Amending Ordinance"), D.C.D. increased the amount of grant funds available in the 35^lh/Halsted Redevelopment Project Area by an additional Five Hundred Thousand Dollars ($500,000) to a total collective amount of One Million Two Hundred Fifty Thousand Dollars ($1,250,000) (the "Twenty-First Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council ofthe City on November 18, 2009 and published in the Journal ofthe Proceedings ofthe City Council ofthe City of Chicagotor said date at pages 74011 to 74023, inclusive ("Twenty-Second Amending Ordinance"), D.C.D. extended the S.B.I.F. Program to the 95^th Street and Stony Island Avenue, Avalon Park/South Shore, Harlem Industrial Park Conservation, and Western Avenue/Rock Island Redevelopment Project Areas of the City (the "Twenty-Second Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on_, 2009 and

published in the Journal ofthe Proceedings of the City Council of the City of Chicago tor said

date at pages_to_, inclusive ("Twenty-Third Amending Ordinance"), the City

Council authorized D.C.D. to enter into an agreement amending the Second SomerCor Agreement with SomerCor which restated the S.B.I.F. Program Rules, extended the S.B.I.F. Program to the Avondale and Woodlawn Redevelopment Project Areas, and increased the amount of grant funds available in the Northwest Industrial Corridor Redevelopment Project Area by an additional One Million Dollars ($1,000,000) to a total collective amount of Two Million Five Hundred Thousand Dollars ($2,500,000) (the "Twenty-Third Amending Agreement"); and

Whereas, By an ordinance adopted by the City Council of the City on_, 2010 and

published in the Journal of the Proceedings of the City Council of the City of Chicago tor said

date at pages_to_, inclusive ("Twenty-Fourth Amending Ordinance"), D.C.D.

extended the S.B.I.F. Program to the Addison South Redevelopment Project Area of the City (the "New T.I.F./S.B.I.F. Area"), as identified on (Sub)Exhibit 1, attached hereto and incorporated herein; and

Whereas, The Twenty-Fourth Amending Ordinance authorized D.C.D. to enter into an agreement with SomerCor to provide S.B.I.F. Program administrative services in the New

82442

JOURNAL-CITY COUNCIL-CHICAGO

1/13/2010

T.I.F./S.BJ.F. Area, and D.C.D. and SomerCor now desire to enter into such an agreement, which will amend the Second SomerCor Agreement;

Now, Therefore, In consideration ofthe mutual promises and covenants set forth below, the parties hereto agree as follows:

Article I. Incorporation Of Recitals.

The recitals set forth above are incorporated by reference as if fully set forth herein.

Article II.

Reaffirmation Of Representations, Warranties And Covenants.

SomerCor reaffirms each and every representation, warranty and covenant made in Article III of the Second SomerCor Agreement. SomerCor reaffirms that it has insurance in force that conforms to the requirements of Section 4.8 of the Second SomerCor Agreement.

Article III.

Amendments To Second Somercor Agreement.

The Second SomerCor Agreement, as amended, is further amended, as follows. Note that the letters previously used to label each subsection of (a) have been replaced with numbers.

(a) add the following text at the end of Exhibit 2 thereof:

; and

71) on May 9, 2007: (1) "An Ordinance of the City of Chicago, Illinois Approving a Redevelopment Plan for the Addison South Redevelopment Project Area"; (2) "An Ordinance of the City of Chicago, Illinois Designating the Addison South Redevelopment Project Area as a Redevelopment Project Area Pursuant to the Tax Increment Allocation Redevelopment Act"; and (3) "An Ordinance of the City of Chicago, Illinois Adopting Tax Increment Allocation Financing for the Addison South Redevelopment Project Area".

1/13/2010

REPORTS OF COMMITTEES

82443

(b) add the following text at the end of Exhibit 5 thereof: Addison South $1,000,000

(c) substitute the following for each occurrence of "Sixty-seven Million Two Hundred Sixty Thousand Dollars ($67,260,000)" in Section 4.2 thereof:

Sixty-eight Million Two Hundred Sixty Thousand Dollars ($68,260,000).

Article IV. Obligation To Provide Documents.

SomerCor shall execute and deliver to D.C.D. such documents as may be required by the Corporation Counsel of the City to evidence SomerCor's participation in the Program, including, but not limited to, the City's current form of Economic Disclosure Statement and an opinion of counsel in substantially the form of (Sub)Exhibit 2 attached hereto and incorporated herein.

In Witness Whereof, The City and SomerCor have executed this Agreement as of the date first set forth above.

City of Chicago

By:____

(Acting) Commissioner, Department of Community Development

SomerCor 504, Inc.

By: Its:

[(Sub)Exhibit 1 referred to in this Twenty-Fourth Amending Agreement to Administrative Services Agreement with SomerCor 504, Inc. constitutes Exhibit "A" to ordinance and printed on page 82437 of this Journal.]

82444

JOURNAL-CITY COUNCIL-CHICAGO

1/13/2010

(Sub)Exhibit 2 referred in this Twenty-Fourth Amending Agreement to Administrative Services Agreement with SomerCor 504, Inc. reads as follows:

(Sub)Exhibit 2.

(To Twenty-Fourth Amending Agreement To Administrative Services Agreement With SomerCor 504, Inc.)

Form Of Counsel's Opinion.

, 2010

City of Chicago

Department of Community Development 121 North LaSalle Street Chicago, Illinois 60602

Re: Amending Agreement to Administrative Services Agreement (the "Agreement")

Ladies and Gentlemen:

I have acted as counsel for SomerCor 504, Inc., an Illinois not-for-profit corporation ("SomerCor"), in connection with the execution and delivery of the Agreement by and between SomerCor and the City of Chicago, acting by and through its Department of Community Development (the "City"). SomerCor has requested that this opinion be furnished to the City.

In so acting as counsel for the SomerCor, I have examined:

(i) an executed original of the Agreement;

(ii) the Articles of Incorporation, including all amendments thereto, of SomerCor as furnished and certified by the Secretary of State of the State of Illinois;

(iii) the Bylaws of SomerCor, as certified by the Secretary of SomerCor as of the date hereof; and

(iv) the Certificate of Good Standing dated_, issued by the Office of the

Secretary of State of the State of Illinois, as to the good standing of SomerCor.

In my capacity as counsel, I have also examined such other documents or instruments as I have deemed relevant for the purposes of rendering the opinions hereinafter set forth.

1/13/2010

REPORTS OF COMMITTEES

82445

I have also assumed, but have no reason to question, the legal capacity, authority and the genuineness of the signatures of and due and proper execution and delivery by the respective parties other than SomerCor which has made, executed or delivered orwill make, execute and deliver the agreements and documents examined by me.

I express no opinion as to (i) the laws of any state or jurisdiction other than the State of Illinois (and any political subdivisions thereof) and the United States of America; and (ii) any matters pertaining or relating to the securities laws ofthe United States of America, the State of Illinois or any other state.

Based upon and subject to the assumptions and qualifications herein stated, it is my opinion that:

1. SomerCor is a not-for-profit corporation, duly organized and validly existing under the laws ofthe State of Illinois, SomerCor has made all filings required by the laws of the State of Illinois in respect of its formation and continuing existence, and has all requisite authority to carry on its business and to execute and deliver, and to consummate the transactions contemplated by, the Agreement.

2. The Agreement has been duly executed and delivered on behalf of SomerCor, and constitutes a legal, valid and binding obligation of SomerCor, enforceable against SomerCor in accordance with its terms, except to the extent that enforcement of any such terms may be limited by: (a) applicable bankruptcy, reorganization, debt arrangement, insolvency or other similar laws generally affecting creditors' rights; or (b) judicial and public policy limitations upon the enforcement of certain remedies including those which a court of equity may in its discretion decline to enforce.

3. There is no action, suit or proceeding at law or in equity pending, nor to my knowledge threatened, against or affecting SomerCor, before any court or before any governmental or administrative agency, which if adversely determined could materially and adversely affect the ability of SomerCor to perform under the Agreement or any of its business or properties or financial or other conditions.

4. The transactions contemplated by the Agreement are governed by the laws of the State of Illinois.

5. The execution and delivery of the Agreement and the consummation of the transactions contemplated thereby will not constitute:

A. a violation or breach of (i) the Articles of Incorporation of SomerCor, (ii) the ByLaws of SomerCor, (iii) any provision of any contract or other instrument to which SomerCor is bound, or (iv) any order, writ, injunction, decree, statute, rule or regulation binding on SomerCor, or

B. a breach of any of the provisions of, or constitute a default under, or result in the creation or imposition of any lien or encumbrance upon any of the

82446

JOURNAL-CITY COUNCIL-CHICAGO 1/13/2010

property of SomerCor pursuant to any agreement or other instrument to which SomerCor is a party or by which SomerCor is bound.

6. No action of, or filing with, any governmental or public body is required to authorize, or is otherwise required for the validity of, the execution, delivery and performance of any of the Agreement.

This opinion is furnished for your benefit and may be relied upon by you and any such other party in connection with the Agreement, but may not be delivered to or relied upon by any other person or entity without written consent from the undersigned.

Very truly yours,

CREATION OF ADDISON SOUTH SINGLE-FAMILY PROGRAM, APPROPRIATION OF TAX INCREMENT FINANCING FUNDS AND EXECUTION OF TAX INCREMENT FINANCING NEIGHBORHOOD IMPROVEMENT PROGRAM AGREEMENT WITH NEIGHBORHOOD HOUSING SERVICES OF CHICAGO, INC.

[O2010-2]

The Committee on Finance submitted the following report:

CHICAGO, January 13, 2010.

To the President and Members of the City Council:

Your Committee on Finance, having had under consideration an ordinance authorizing entering into and executing an agreement with Neighborhood Housing Services of Chicago, Inc. regarding the Addison South T.I.F. Neighborhood Improvement Program, having had the same under advisement, begs leave to report and recommend that Your Honorable Body Pass the proposed ordinance transmitted herewith.

ATTACHMENT D

82446 JOURNAL-CITY COUNCIL-CHICAGO 1/13/2010

property of SomerCor pursuant to any agreement or other instrument to which SomerCor is a party or by which SomerCor is bound.

No action of, or filing with, any governmental or public body is required to authorize, or is otherwise required for the validity of, the execution, delivery and performance of any of the Agreement.

Very truly yours,

CREATION OF ADDISON SOUTH SINGLE-FAMILY PROGRAM, APPROPRIATION OF TAX INCREMENT FINANCING FUNDS AND EXECUTION OFTAX INCREMENT FINANCING NEIGHBORHOOD IMPROVEMENT PROGRAM AGREEMENT WITH NEIGHBORHOOD HOUSING SERVICES OF CHICAGO, INC.

[O2010-2]

The Committee on Finance submitted the following report:

CHICAGO, January 13, 2010.

To the President and Members of the City Council:

1/13/2010

REPORTS OF COMMITTEES

82447

This recommendation was concurred in by a viva voce vote of the members of the Committee.

Respectfully submitted,

(Signed) EDWARD M. BURKE,

Chairman.

On motion of Alderman Burke, the said proposed ordinance transmitted with the foregoing committee report was Passed by yeas and nays as follows:

Yeas -- Aldermen Flores, Fioretti, Dowell, Preckwinkle, Hairston, Lyle, Harris, Beale, Pope, Balcer, Cardenas, Olivo, Burke, Foulkes, Thompson, Thomas, Lane, Rugai, Cochran, Brookins, Munoz, Zalewski, Dixon, Solis, Maldonado, Burnett, E. Smith, Carothers, Reboyras, Suarez, Waguespack, Mell, Colon, Rice, Mitts, Laurino, O'Connor, Doherty, Reilly, Daley, Tunney, Shiller, Schulter, M. Smith, Moore, Stone - 46.

Nays - None.

Alderman Carothers moved to reconsider the foregoing vote. The motion was lost. The following is said ordinance as passed:

WHEREAS, Pursuant to an ordinance adopted by the City Council ("City Council") of the City of Chicago (the "City") on May 9, 2007, a certain redevelopment plan and project (the "Addison South Plan") for the Addison South Redevelopment Project Area (the "Addison South Area") was approved pursuant to the Illinois Tax Increment Allocation Redevelopment Act, as amended (65 ILCS 5/11-74.4-1, et seq.) (the "Act"); and

WHEREAS, Pursuant to an ordinance adopted by the City Council on May 9, 2007, the Addison South Area was designated as a redevelopment project area pursuant to the Act; and

WHEREAS, Pursuant to an ordinance adopted by the City Council on May 9, 2007, tax increment allocation financing was adopted pursuant to the Act as a means of financing certain Addison South Area redevelopment project costs (as defined in the Act) incurred pursuant to the Addison South Plan; and

WHEREAS, The City, through its Department of Community Development ("D.C.D."), proposes to establish a T.I.F. Neighborhood Improvement Program in an amount not to exceed Two Hundred Fifty Thousand Dollars ($250,000) to fund improvements to single-family residential properties in the Addison South Area (the "Addison South Single-Family Program"); and

82448

JOURNAL-CITY COUNCIL-CHICAGO 1/13/2010

WHEREAS, D.C.D. desires to enter into a T.I.F. Neighborhood Improvement Program Agreement (the "Addison South N.H.S. Agreement") with Neighborhood Housing Services of Chicago, Inc., an Illinois not-for-profit corporation ("N.H.S."), which Addison South N.H.S. Agreement is set forth in more detail on Exhibit A, attached hereto and incorporated herein, pursuant to which N.H.S. will perform certain administrative services for the City and will make grants to eligible owners of residential buildings in the Addison South Area to provide financing assistance for the improvement and rehabilitation of residential properties in the Addison South Area, pursuant to the City's T.I.F. Neighborhood Improvement Program (the "N.I.PI Program"); and

WHEREAS, The costs incurred or to be incurred by D.C.D. in connection with implementing the N.I.P. Program and the Addison South N.H.S. Agreement in the Addison South Area are proper Redevelopment Project Costs of the Addison South Area; and

WHEREAS, The City's obligation to provide funds under the Addison South N.H.S. Agreement will be met through (i) incremental taxes deposited in the Special Tax Allocation Fund of the Addison South Area, or (ii) any other funds legally available to the City for this purpose; now, therefore,

Be It Ordained by the City Council of the City of Chicago:

SECTION 1. The above recitals are incorporated herein and made a part hereof.

SECTION 2. The Addison South Single-Family Program is hereby created, which program shall, among other things, fund the improvement and rehabilitation of residential properties in the Addison South Area in accordance with the Addison South N.H.S. Agreement. An amount not to exceed Two Hundred Fifty Thousand Dollars ($250,000) is hereby appropriated from the Special Tax Allocation Fund of the Addison South Area to fund the Addison South Single-Family Program.

SECTION 3. N.H.S. is hereby designated to administer the Addison South Single-Family Program, subject to the supervision of D.C.D.

SECTION 4. The Commissioner or Acting Commissioner of D.C.D., or his/her designee, are each hereby authorized, with the approval of the City's Corporation Counsel as to form and legality, to negotiate, execute and deliver the Addison South N.H.S. Agreement with N.H.S. to administer the Addison South Single-Family Program substantially in the form attached hereto as Exhibit A and made a part hereof, and such other supporting documents as may be necessary to carry out and comply with the provisions thereof, with such changes, deletions and insertions as shall be approved by the persons executing the agreement.

SECTION 5. If any provision of this ordinance shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such provision shall not affect any of the other provisions of this ordinance.

1/13/2010

REPORTS OF COMMITTEES

82449

SECTION 6. To the extent that any ordinance, resolution, rule, order or provision of the Municipal Code of Chicago, or part thereof, is in conflict with the provisions of this ordinance, the provisions of this ordinance shall control. If any section, paragraph, clause or provision of this ordinance shall be held invalid, the invalidity of such section, paragraph, clause or provision shall not affect any of the other provisions of this ordinance.

SECTION 7. This ordinance shall be effective as of the date of its passage.

Exhibit "A" referred to in this ordinance reads as follows:

Exhibit "A".

T.I.F. Neighborhood Housing Program Agreement With Neighborhood Housing Services Of Chicago, Inc. For Administration Of The Addison South Single-Family Program.

This T.I.F. Neighborhood Improvement Program Agreement (the "Agreement") is made on

_, 2010 by and between the City of Chicago, a municipal corporation and home

rule unit of local government existing under the 1970 Constitution of the State of Illinois (the "City"), acting through its Department of Community Development ("D.C.D."), and Neighborhood Housing Services of Chicago, Inc., an Illinois not-for-profit corporation ("N.H.S.").

Whereas, To induce redevelopment pursuant to the Act, the City Council of the City (the "City Council") adopted the following ordinances on May 9, 2007: (1) "An Ordinance ofthe City of Chicago, Illinois Approving a Redevelopment Plan for the Addison South Redevelopment Project Area"; (2) "An Ordinance of the City of Chicago, Illinois Designating the Addison South Redevelopment Project Area as a Redevelopment Project Area Pursuant to the Tax Increment Allocation Redevelopment Act"; and (3) "An Ordinance of the City of Chicago, Illinois Adopting Tax Increment Allocation Financing for the Addison South Redevelopment Project Area" (the "Addison South Financing Ordinance"). The redevelopment project area referred to above is referred to herein as the "Addison South T.I.F. Area" and the Redevelopment Plan referred to above is referred to herein as the "Addison South Plan"; and

Whereas, By an ordinance adopted by the City Council of the City on_, 2010,

the City has approved the execution and delivery of this Agreement to implement a portion

82450

JOURNALCITY COUNCIL-CHICAGO 1/13/2010

ofthe program known as the TJ.F. Neighborhood Improvement Program (the "Program"); and

Whereas, D.C.D. desires to implement a portion of the Program by using the services of N.H.S., and N.H.S. desires to administer a portion ofthe Program in accordance with the provisions of this Agreement;

Now, Therefore, In consideration of the mutual promises and covenants set forth below, the parties hereto agree as follows:

Article I. Incorporation And Recitals.

The recitals set forth above are incorporated by reference as if fully set forth herein.

Article II. Definitions.

"Application" means an application from a potential Eligible Homeowner for a Grant hereunder, in a form prepared by N.H.S. and approved by D.C.D.

"Corporation Counsel" means the Corporation Counsel of the City.

"Eligible Costs" means the following rehabilitation costs which are incurred by eligible Homeowners pursuant to the Grant Documents and funded with Grant funds: exterior improvements including but not limited to roofs, windows, entryways, porches and masonry; up to thirty percent (30%) of the total Grant amount may be used for one of the two following purposes, at the option of the Selected Applicant:

(a) interior life/safety improvements, but only to the extent that such improvements are designed to address a current (rather than potential) health and safety risk; and related architect's fees; or

(b) the cost of an energy audit that recommends measures to improve the energy efficiency of a building may be included as a rehabilitation cost to the extent that:

(i) the building renovations undertaken pursuant to such recommendation promote energy efficiency and resource conservation (e.g., the installation of low-flow

1/13/2010

REPORTS OF COMMITTEES

82451

plumbing fixtures or energy-efficient H.V.A.C. systems, the use of building materials made with a high degree of recycled content or renewable or non-toxic substances); and

(ii) the cost of the energy audit does not exceed ten percent (10%) of the project budget.

"Eligible Homeowner" means, collectively, all the persons who occupy a housing unit used as their primary residence, which may be a single-family, one person living alone, two or more families living together, or any other group of related or unrelated persons who share living arrangements, qualifying as a Qualified Family at the time the Eligible Homeowner submits an application to N.H.S., but shall not include any individual who is an employee of the City, or any individual who is an employee, agent, consultant, officer, elected official, or appointed official, of N.H.S. (or any person who was an employee, agent, consultant, officer or, elected or appointed official within one year prior to the date any Grant is made) if, in either case, the individual exercises or has exercised any functions or responsibilities with respect to activities assisted with Program Funds or who is or was in a position to participate in a decision-making process or gain inside information with regard to such activities, or has or will have any interest in any contract, subcontract or agreement with respect to the housing unit, either for himself or for those with whom he has family or business ties.

"Event of Default" means any event of default as set forth in Section 5.1 hereof.

"Grant" means any grant of funds made by N.H.S. to an Eligible Homeowner from Program Funds.

"Grant Documents" means the agreements entered into between N.H.S. and an Eligible Homeowner in connection with a Grant, which documents shall be in substantially the form approved by Corporation Counsel.

"H.U.D." means the United States Department of Housing and Urban Development.

"Lottery" shall have the meaning set forth in Section 4.3(b) hereof.

"Maximum Program Assistance" means (a) for a Qualified Housing Unit comprised of a single-family home, Twelve Thousand Five Hundred Dollars ($12,500), (b) for a Qualified Housing Unit comprised of two living units, Seventeen Thousand Five Hundred Dollars ($17,500), (c) for a Qualified Housing Unit comprised of three living units, Twenty Thousand Dollars ($20,000), and (d) for a Qualified Housing Unit comprised of four living units, Twenty-two Thousand Five Hundred Dollars ($22,500).

"Median Income" means the median income of the Chicago area, adjusted for family size, as determined by H.U.D. from time to time.

"N.H.S." means Neighborhood Housing Services of Chicago, Inc., an Illinois not-for-profit corporation, and its successors and assigns.

82452

JOURNAL-CITY COUNCIL-CHICAGO 1/13/2010

"Program Funds" means those funds which will be used by the City to implement the Program in accordance with this Agreement.

"Qualified Family" means a family whose annual household income does not exceed one hundred forty percent(140%) of the Median Income.

"Qualified Housing Unit" means a one- to four-unit residence located within the Addison South T.I.F. Area which shall be used (or residential purposes. In the case of a two- to four-unit residence, one unit shall be occupied by the Eligible Homeowner at the time the Application is made and the Grant Documents are executed.

"State" means the State of Illinois.

Article III.

Representations, Warranties And Covenants.

3.1 Representations And Warranties.

In connection with the executions and delivery of this Agreement, N.H.S. represents and warrants to the City that:

(a) N.H.S. is incorporated in the States as a not-for-profit corporation; and is in good standing in the State;

(b) N.H.S. is financially solvent and able to pay its debts as they mature;

(c) N.H.S., its employees, agents and officials are competent and qualified to perform the services required under this Agreement;

(d) N.H.S. has the right, power and authority to execute, deliver and perform, or cause to be performed, this Agreement under the terms and conditions stated herein; N.H.S. has obtained and received all necessary approvals from its Board of Directors and any other required approvals which are necessary for N.H.S. to execute and deliver this Agreement and to perform its duties hereunder;

(e) no member of the governing body of the City and no other elected official, appointed official, officer, agent, consultant or employee of the City is employed by N.H.S. or has a financial or economic interest directly in this Agreement or the compensation to be paid hereunder except as may be permitted by the Board of Ethics established pursuant to the Municipal Code of Chicago;

1/13/2010

REPORTS OF COMMITTEES

82453

(f) N.H.S. is not in default on any contract or loan awarded to N.H.S. by the City at the time of the execution of this Agreement, and N.H.S. has not been, within five (5) years preceding the date hereof, in default on any contract or loan awarded to N.H.S. by the City;

(g) N.H.S. has carefully examined and analyzed the provisions and requirements of this Agreement and, from this analysis, N.H.S. has satisfied itself as to the nature of all things needed for the performance of this Agreement; and the time available to N.H.S. for such examination, analysis, inspection and investigation has been adequate;

(h) this Agreement is feasible of performance by N.H.S. as appropriate, in accordance with all of its provisions and requirements;

(i) except only for those representations, statements or promises expressly contained in this Agreement and any exhibits attached hereto and incorporated by reference herein, no representation, statement or promise, oral or in writing, or of any kind whatsoever, by the City, its officials, agents or employees, has induced N.H.S. to enter into this Agreement or has been relied upon by N.H.S. including any with reference to (A) the meaning, correctness, suitability or completeness of any provisions or requirements of this Agreement; (B) the general conditions which may in any way affect this Agreement or its performance; (C) the compensation provisions of this Agreement; or (D) any other matters, whether similar to or different from those' referred to in (A) through (C) immediately above, affecting or having any connection with this Agreement, the negotiation hereof, any discussions hereof, the performance hereof or those employed herein or connected or concerned herewith;

(j) N.H.S. was given ample opportunity and time and was requested by the City to review thoroughly this Agreement prior to execution of this Agreement in order that N.H.S. might request inclusion in this Agreement of any statement, representation, promise or provision which is desired or on which N.H.S. wished to place reliance, that it did so review said documents, and either every such statement, representation, promise or provision has been included in this Agreement or else, if omitted, N.H.S. expressly hereby relinquishes the benefit of any such omitted statement, representation, promise or provision and N.H.S. is willing to perform this Agreement in its entirety without claiming reliance thereon or making any other claim on account of such omission;

(k) there are no actions or proceedings by or before any court or governmental commission, board, bureau or other administrative agency pending or, to the knowledge of N.H.S., threatened, against or affecting N.H.S. which if adversely determined could materially and adversely affect the ability of N.H.S. to perform hereunder or.which might result in any material, adverse change to the financial condition of N.H.S. or may materially affect the property or assets of N.H.S.; and

(I) this Agreement has been executed and delivered by authorized officers of N.H.S. and constitutes a legal, valid and binding obligation of N.H.S., enforceable in accordance with its terms.

82454

JOURNAL-CITY COUNCIL-CHICAGO

1/13/2010

3.2 Covenants.

In connection with the execution and delivery of this Agreement, N.H.S. covenants to the City that:

(a) except for its own employees, N.H.S. will not use any individual, organization, partnership or corporation to carry out any ofthe duties or obligations of N.H.S. hereunder, unless (1) N.H.S. first obtains a certification of such individual, organization, partnership or corporation substantially the same as the representations, warranties and covenants contained in this Article 111 and in Article IV hereof, (2) such certifications shall be addressed and delivered to the City and (3) the City approves, in writing, the use of such individual, organization, partnership or corporation;

(b) all warranties and representations of N.H.S: contained in this Agreement will be true, accurate and complete at the time of each Grant made pursuant to this Agreement, and shall survive the execution, delivery and acceptance hereof by the parties hereto for the length of this Agreement;

(c) N.H.S. shall be subject to, obey and adhere to any and all federal, State and local laws, statutes, ordinances, rules, regulations and executive orders as are now or may be in effect during the term of this Agreement which may be applicable to N.H.S.;

(d) N.H.S. shall remain solvent and able to pay its debts as they mature;

(e) no member of the governing body of the City and no other elected official, appointed official, officer, agent, consultant or employee of the City shall have any personal interest, director indirect, in the business of N.H.S. or shall participate in any decision relating to the business of N.H.S. which affects his/her personal interests or the interests of any corporation, partnership or association in which he/she is directly interested;

(f) no former member of the governing body of the City and no former other elected official, appointed official, officer, agent, consultant or employee of the City shall, for a period of one year after the termination of such person's term of office or employment, assist or represent N.H.S. in any business transaction involving the City or any of its agencies, if the person participated personally and substantially in the subject matter of the transaction during his/her term of office or employment, provided that if the person exercised contract management authority with respect to this Agreement (including any Grant), this prohibition shall be permanent as to this Agreement;

(g) N.H.S. shall immediately notify the City of any and all events or actions which may materially adversely affect the ability of N.H.S. to carry on its operations or perform any or all of its obligations under this Agreement at any time while this Agreement is in effect;

(h) N.H.S. shall not enter into any other agreement or transaction which would conflict with the performance of the duties of N.H.S. hereunder or under any of the Grant Documents;

1/13/2010

REPORTS OF COMMITTEES

82455

(i) during the term of this Agreement, N.H.S. shall continue as an Illinois not-for-profit corporation in good standing under the laws of the State; and

(j) N.H.S. shall enforce all provisions of the Grant Documents in accordance with the terms thereof and shall provide to the City all notices required hereunder or thereunder.

Article IV. Duties And Obligations.

4.1

N.H.S. shall execute and deliver to D.C.D. such documents as may be required by the Corporation Counsel to evidence N.H.S.'s participation in the Program, including, but not limited to, the City's current form of Economic Disclosure Statement and an opinion of counsel in substantially the form of (Sub)Exhibit A attached hereto and incorporated herein.

4.2

(a) N.H.S. agrees that the total amount of funds available for the Program hereunder shall be up to Two Hundred Fifty Thousand Dollars ($250,000) and that there have been no representations, assurances or agreements that any other assistance shall be forthcoming from the City. N.H.S. shall provide written notice to. the City when the aggregate amount of Program Funds committed or paid hereunder, including Grants and administrative costs paid to or for the account of N.H.S. pursuant to Section 6.5, equals Two Hundred Thousand Dollars ($200,000) and thereafter when the amount of Program Funds committed or paid hereunder, including Grants and administrative costs paid to or for the account of N.H.S. pursuant to Section 6.5, reaches Two Hundred Fifty Thousand Dollars ($250,000). Program Funds are deemed committed for purposes of this Section When N.H.S. has determined the amount of Program Funds to be the subject of a Grant and sent notice of final approval of an Application pursuant to Section 4.3(e) to an Eligible Homeowner. No Grants shall be made or committed to be made by N.H.S. hereunder when such commitment would result in the aggregate amount of Grants, together with all administrative costs related to such Grants paid to N.H.S. pursuant to Section 6.5, exceeding Two Hundred Fifty Thousand Dollars ($250,000) (or such other amount as the City may determine from time to time). No Grants shall be made or committed to be made by N.H.S. hereunder when such commitment occurs after the date of receipt of the notice from the City described in Section 6.2 hereof regarding the termination of this Agreement.

(b) As of the date of this Agreement, the total amount of funds available hereunder for use in the Addison South T.I.F. Area is Two Hundred Fifty Thousand Dollars ($250,000). This amount may be changed from time to time upon written notice by D.C.D. to N.H.S., provided

82456

JOURNAL-CITY COUNCIL-CHICAGO 1/13/2010

that the aggregate amount shall not exceed Two Hundred Fifty Thousand Dollars ($250,000) (or such other amount as the City may determine from time to time).

4.3

(a) N.H.S. shall accept and process Applications in the following manner (or as otherwise agreed to by D.C.D. and N.H.S.):

(i) N.H.S. shall make Application forms available for a period of four to six weeks;

(ii) N.H.S. shall make applications available at certain locations within the Addison South T.I.F. Area such as community centers or libraries (as agreed to by D.C.D.);

(iii) Applications shall also be available by calling N.H.S.;

(iv) The Application will be approximately three (3) pages in length, from which N.H.S. will be able to determine eligibility hereunder. N.H.S. will require homeowners to provide more information if they are selected for a matching loan hereunder;

(v) All Applications shall be returned directly to N.H.S.; the City will not accept Applications; and

(vi) All Applications must be received by a defined deadline of two weeks after the expiration ofthe period in (i) above.

(b) N.H.S. shall review all Applications for eligibility, completeness and compliance with the Agreement. N.H.S. shall verify the initial eligibility of each applicant within five days after its receipt in the manner described in subsection (c) below. Only those Applications which meet such criteria will be part of the Lottery. Applications so approved are to be numbered as they are received until the expiration of the period in (a)(vi) above. All such applicants shall be notified of the Lottery date and location by mail at least one week prior to holding the Lottery. The Lottery shall be conducted in a public place. At the lottery meeting, random numbers will be generated by computer (or such other method as determined by D.C.D. and N.H.S.) and the numbers will determine which Applications will be selected ("Selected Applicants") for further processing. The process by which the Selected Applicants are identified is referred to herein as the "Lottery". The amount of each Grant request from each Selected Applicant, including the applicable fee to be paid to N.H.S. hereunder, will be deemed to be for the Maximum Program Assistance. When the aggregate amount entered in the log reaches Two Hundred Fifty Thousand Dollars ($250,000), or such other amount as D.C.D. shall in writing specify to N.H.S., then N.H.S. shall stop selecting Applications.

To accommodate the possibility that additional Selected Applicants will need to be chosen from eligible Applications because some earlier Applications are not in compliance with this Agreement, or because Program Funds are still available to make Grants, N.H.S. may

1/13/2010

REPORTS OF COMMITTEES

82457

establish a waiting list of up to twenty-five (25) applicants, to be chosen by the same lottery process described above. If additional Applications are needed thereafter, then N.H.S. will designate a time and place as set forth above to receive additional Applications.

(c) Prior to the date of the Lottery; for each potential Eligible Homeowner, N.H.S. shall obtain income and title information regarding the Eligible Homeowner and the Qualified Housing Unit, respectively, and shall verify information presented in the Application. N.H.S. shall assure that an Eligible Homeowner qualifies as a Qualified Family at the time an Application is received by N.H.S In determining whether a Eligible Homeowner qualifies as a Qualified Family, N.H.S. calculate income in a manner determined by N.H.S. and approved by D.C.D.

(d) N.H.S. shall forward the name, address and social security number of every Selected Applicant to the City's Department of Revenue for a scofflaw check. N.H.S. shall perform an initial site visit to verify that the property will qualify. N.H.S. shall approve a scope of work. No building will qualify as a Qualified Housing Unit hereunder if the combination of the Grant funds, funds from the Eligible Homeowner and matching loan funds described in Section 4.4(b) hereof do not cover the cost of correcting the health and safety issues which have been identified by N.H.S. inspectors. For any Qualified Housing Unit, no more than thirty percent (30%) of the Eligible Costs paid for from Program Funds can relate to interior life/safety improvements.

(e) For applicants who do not meet the requirements of this Agreement, as determined by N.H.S. after its initial review described in subsection (c) above, N.H.S. shall provide notice to such applicants that their Application has been rejected within two weeks after the expiration of the period described in subsection (a)(vi) above. For all applicants whose Application is in compliance with the requirements of this Agreement (based on N.H.S.'s initial review described in subsection (c) above), N.H.S. will notify each such applicant, within two weeks of the date of the Lottery, as follows: those who are not Selected Applicants will be notified that their name has been placed on a waiting list; and Selected Applicants will be asked for further information to process their Application. The notice to Selected Applicants will also inform the applicant that, if requested materials are not supplied within forty-five (45) days in a form satisfactory to N.H.S., the applicants will forfeit their status as a Selected Applicant and will be placed at the bottom ofthe waiting list. If the scofflaw check described in subsection (d) above reveals that any amounts are owed to the City, then the materials requested by N.H.S. shall include evidence that all such amounts have been paid or that the applicant has entered into a payment plan with the City. Thereafter, N.H.S. shall, within ninety (90) days of the date of the Lottery, complete its review of all information required hereunder and notify each such Selected Applicant whether they are eligible for a Grant, the amount of the Grant, and whether other funds need to be obtained by the Applicant pursuant to Section 4.4(b). No Selected Applicant shall be eligible for a Grant hereunder until N.H.S. has received the results of the scofflaw check described in (d) above and has received evidence either that all amounts owed to the City have been paid, or that the applicant has entered into a payment plan with the City. N.H.S. shall provide the City with a copy of each such notice described above. All notices of rejection shall include the reasons for such rejection.

82458

JOURNAL-CITY COUNCIL-CHICAGO

1/13/2010

4.4

N.H.S. shall provide the following services:

(a) Technical/Rehabilitation Services. For all Selected Applicants, N.H.S. shall make an initial site visit to the Qualified Housing Unit; and assist the Selected Applicant in the preparation of detailed plans and specifications for the renovation work. N.H.S. shall monitor the process by which the Selected Applicant selects a contractor (or contractors) to do the renovation work to ensure that any contractor has been selected through a competitive bid process. N.H.S. must approve the contractor selected, which must be licensed, and properly insured; in its approval, N.H.S. shall consider the financial strength of the contractor. N.H.S. shall review the contract(s) between the Selected Applicant and the contractor(s) for the renovation work. N.H.S. shall make available to each Selected Applicant (i) a current list of contractors and subcontractors which are certified by the City as Minority Business Enterprises or Women Business Enterprises, and (ii) a current list of contractors and subcontractors which have current insurance certificates and proof of City home repair and/or business licenses on file with N.H.S While the requirements of Section 2-92-330 ofthe Municipal Code ofthe City of Chicago (City Resident Employment Requirement) will not apply to the renovation work done pursuant to the Program, N.H.S. shall use its best efforts to recruit and encourage the use of qualified contractors based in Chicago (particularly in the Addison South T.I.F. Area) for the renovation work being funded pursuant to this Agreement.

(b) Requirements for Grants for Qualified Housing Units. After approving an Application, N.H.S. shall promptly prepare and execute Grant Documents for each Grant. N.H.S. shall assure that each Grant satisfies all applicable requirements of federal, State and local law, and that:

(i) Program Funds finance only Eligible Costs;

(ii) for an Eligible Homeowner who has household income between one hundred percent (100%) and one hundred forty percent (140%) of Median Income, the Grant Funds shall not be provided unless an equal amount of loan proceeds or other funds from the Eligible Homeowner (which loans may, but shall not be required to, be made by Neighborhood Lending Services, Inc. ("N.L.S."), an affiliate of N.H.S.) are available for repairs to the Qualified Housing Unit; provided, that repairs paid for (or reimbursed) from funds other than Program Funds hereunder are not required to be Eligible Costs;

(iii) if the Eligible Homeowner has household income (calculated as described above) below one hundred percent (100%) of the Median Income, no matching funds are required pursuant to this subsection, but other provisions of this Agreement may require an Eligible Homeowner to obtain a matching loan for the Qualified Housing Unit; and

1/13/2010

REPORTS OF COMMITTEES

82459

(iv) one or more units of the Qualified Housing Unit shall be occupied by the Eligible Homeowner.

(c) Closing. N.H.S. shall promptly close each Grant. Prior to disbursement of any Program Funds by N.H.S., N.H.S. shall require each Eligible Homeowner to enter into the Grant Documents. N.H.S. shall assure that the renovation of the Qualified Housing Unit commences within six months of the date on which a Grant closes. N.H.S. shall provide in all Grant Documents that the City is a third-party beneficiary ofthe Grant Documents. N.H.S. shall not provide Program Funds to any Eligible Homeowner in an amount in excess of the applicable Maximum Program Assistance; provided, that the maximum amount so provided may be adjusted by mutual agreement of D.C.D. and N.H.S. based on the availability of Program Funds and the projected need of a particular community.

(d) Disbursement Of Proceeds. The City will from time to.time place all or a portion of the Program Funds, in an amount determined by D.C.D. but not exceeding Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate, into an interest-bearing segregated or escrow account established by N.H.S. for this purpose. Any income earned on amounts held in the account shall be used at the sole discretion of the City: (i) to make Grants hereunder, or (ii) in such other manner as the City determines. N.H.S. shall disburse funds from this account to the City at the written request of the City if income is earned on amounts held in the account. N.H.S. shall make any such disbursement within thirty (30) days of its receipt ofthe City's request. N.H.S. agrees that any disbursements from this account which are later determined to have been made in violation of this Agreement will be repaid to this account by N.H.S Prior to disbursing any proceeds of a Grant, N.H.S. shall determine the aggregate amount of Program Funds which have been provided or approved for a Qualified Housing Unit and shall not disburse any funds exceeding the Maximum Program Assistance. N.H.S. shall also assure that no Program Funds shall be paid until such funds are needed to reimburse the Eligible Homeowner for the prior payment of Eligible Costs, and that the proceeds of a Grant do not exceed available Maximum Program Assistance with respect to the Qualified Housing Unit. No payment from Program Funds shall be made to the Eligible Homeowner until N.H.S. receives evidence of prior payment to the contractor for the rehabilitation work (consisting of a copy of the check issued to the contractor, which is not required to be a cancelled check, and/or a copy ofthe sworn statement). There shall be no commingling of funds among Grants by N.H.S. and each Grant shall be accounted for separately in the records maintained by N.H.S.

(e) Servicing; Monitoring.

(1) N.H.S. shall specify an employee directly responsible for the working on each Grant. N.H.S. shall provide D.C.D. with notice of the person(s) responsible for these duties and the respective Grants.

(2) If an Eligible Homeowner breaches any covenant or agreement under the applicable Grant Documents, N.H.S. shall mail notice of such breach to the Eligible Homeowner as

82460

JOURNAL-CITY COUNCIL-CHICAGO

1/13/2010

provided in the Grant Documents (with a copy to D.C.D.) and shall take such further action consistent with the terms of this Agreement.

(3) N.H.S. shall monitor the progress of the renovation work to confirm compliance with this Agreement and the Grant Documents. The Grant Documents shall provide that the Eligible Homeowner must approve of payment of funds from N.H.S. to a contractor for the rehabilitation work. N.H.S. shall inspect the renovation work prior to providing payment. N.H.S. shall make a final inspection of the renovation work at its completion to confirm compliance with this Agreement and the Grant Documents.

(f) Reporting. On the seventh day of each month of each year during the term hereof, N.H.S. shall submit to the City a monthly report in a form approved by D.C.D. and containing the following information for each Grant closed during the previous month, and for each Eligible Homeowner whose Application has been approved: (i) the address and census tract of the Qualified Housing Unit; (ii) the name, address, income and race (if known) of each Eligible Homeowner for such Qualified Housing Unit; (iii) the amount of the applicable Grant and the date of the Grant; (iv) the amount of Program Funds, if any, provided to such Eligible Homeowner by the end of the preceding month, and the use of such funds; (v) the status of the renovation work on such Qualified Housing Unit; and (vi) the names of any Eligible Homeowners who have defaulted on any matching loan provided through N.L.S. pursuant to Section 4.4(b) hereof. In addition, N.H.S. shall also include the following in such report regarding the Program as of the end of the preceding month: (i) information about each matching loan made to an Eligible Homeowner, or matching funds provided by the Eligible Homeowner, including the amount of the loan or other funds, the address of the subject property and evidence that matching funds were provided; (ii) number of renovations in process; (iii) number of renovations completed; (iv) total number of applicants; (v) total number of Applications reviewed; (vi) total number of Applications approved and (vii) total amount of Grant funds disbursed hereunder.

(g) Marketing. N.H.S. shall make information about the Program, including Applications, readily available to persons applying to become Eligible Homeowners. In connection therewith, N.H.S. shall prepare and distribute brochures and other written materials describing the Program. N.H.S. shall also make appropriate personnel available to speak at seminars to promote and explain the Program and shall conduct other affirmative outreach efforts (including organizing or participating in seminars, conferences and public meetings) to disseminate information about the Program to the public. N.H.S. shall cooperate (and shall bind its contractors to cooperate) with D.C.D. in any program which D.C.D. may undertake to promote and explain the Program. N.H.S. shall dedicate sufficient employee time and resources to respond promptly to inquiries from potential applicants.

4.5

Prior to each disbursement of proceeds in connection with a Qualified Housing Unit (pursuant to Section 4.4(d) hereof), N.H.S. shall assure to its best efforts that the rehabilitation work performed by the contractor on that Qualified Housing Unit complies with the building codes of the City.

1/13/2010

REPORTS OF COMMITTEES

82461

4.6

N.H.S. shall be responsible for all actions of any agents, employees, officers of N.H.S. performing any duties or obligations of N.H.S. hereunder.

4.7

The City authorizes N.H.S. to act, subject to the limitations contained herein: (i) to manage and service the Grants; (ii) to enforce or to refrain from enforcing the Grant Documents for each Grant; (iii) to give consents or approvals in connection with the Grant Documents for each Grant; (iv) to take or refrain from taking any action and make any determination provided for herein or in the Grant Documents; and (v) to exercise all such powers as are incidental thereto.

4.8

In its marketing efforts regarding the Program, the City shall notify potential Program applicants that, for households earning more one hundred percent (100%) of the Median Income, there will be a matching loan requirement (as set forth in Section 4.4(b) hereof).

4.9 Insurance.

(a) N.H.S. shall procure and maintain at all times, at its own expense, except as may be otherwise provided herein, during the term of this Agreement, the types of insurance specified below, with insurance companies authorized to do such business in the State and reasonably acceptable to the City covering all services hereunder.

The kinds and amounts of insurance required are as follows:

1. Workers' Compensation And Occupational Disease Insurance.

Workers' Compensation and Occupational Disease Insurance, in statutory amounts, covering all of N.H.S Employer's liability coverage shall be included and shall have limits of not less than One Hundred Thousand Dollars ($100,000) per each accident or illness.

2. Commercial Liability Insurance (Primary And Umbrella).

Commercial Liability Insurance or equivalent with limits of not less than Two Hundred Fifty Thousand Dollars ($250,000) per occurrence, combined single limit, for bodily injury, personal injury and property damage liability. Products/completed operation, independent contractors and contractual liability coverages are to be included. The City is to be named as an additional insured.

82462

JOURNAL-CITY COUNCIL-CHICAGO 1/13/2010

3. Automobile Liability Insurance.

When any motor vehicles are used in connection with the work to be performed underthis Agreement, N.H.S. shall maintain Automobile Liability Insurance with limits of not less than Five Hundred Thousand Dollars ($500,000) per occurrence, combined single limit, for bodily injury and property damage. The City is to be named as an additional insured.

4. Errors And Omissions/Profession Liability.

With respect to all services performed by N.H.S. hereunder, errors and omissions coverage shall be maintained in the amount of Two Hundred Fifty Thousand Dollars ($250,000) naming the City as an additional insured.

5. Blanket Crime Insurance.

N.H.S. shall obtain and maintain a blanket crime insurance policy, naming the City as a loss payee, as its interest may appear, covering all persons handling funds received or disbursed under this Agreement, and against loss by reason of theft, robbery, dishonesty, destruction, disappearance or other crimes. The blanket crime insurance policy must be written to cover losses in an amount of not less than twenty-five percent (25%) of the maximum funds on hand at any given time or in an amount of Two Hundred Fifty Thousand Dollars ($250,000), whichever amount is greater.

(b) N.H.S. shall furnish the City, Department of Finance, Risk Management Office, 333 South State Street, Room 400, Chicago, Illinois 60604, original certificates of insurance evidencing the required coverages to be in force and effect on the date hereof, 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 City shall not allow N.H.S. to commence any services under this Agreement until all insurance is purchased and evidence of it is received and approved by the City, but the failure of the City to obtain such evidence from N.H.S. before permitting N.H.S. to commence such services shall not be deemed to be a waiver by the City, and N.H.S. shall remain under a continuing obligation to maintain the coverage and to supply the certificates.

The insurance specified hereinabove shall be carried until all services required to be performed under the terms of this Agreement are satisfactorily completed. Failure to carry or keep such insurance in force shall constitute an Event of Default hereunder within the meaning of Section 5.1 hereof, and the City maintains the right to suspend the provisions hereof until proper evidence of insurance is provided. N.H.S. shall require all subcontractors to carry the insurance required herein, or N.H.S. may, at its option, provide the coverage for any or all subcontractors, and, if so, supply to the City evidence satisfactory to the City of such coverage.

1/13/2010

REPORTS OF COMMITTEES

82463

The City maintains the right to modify, delete, alter or change these requirements.

The insurance policies shall provide for sixty (60) days' prior written notice to be given to the City in the event coverage is substantially changed, canceled or non-renewed.

N.H.S. expressly understands and agrees that any insurance coverages and limits furnished by N.H.S. hereunder shall in noway limit its responsibilities and abilities specified herein or by law.

Article V. Events Of Default; Remedies.

5.1 Events Of Default Defined.

The following, subject to the notice and cure provisions of Section 5.2 hereof, shall each constitute an Event of Default hereunder:

(a) any misrepresentation, whether negligent or willful and whether in the inducement or in the performance of this Agreement, made by N.H.S. to the City;

(b) failure by N.H.S. to perform any of its duties or obligations under this Agreement;

(d) the dissolution of N.H.S. or the entry of a decree or order for relief by a court having jurisdiction with respect to N.H.S. in an involuntary case under the federal bankruptcy laws, as now or hereafter constituted, or any other applicable federal or state bankruptcy, insolvency or other similar law, or appointing a receiver, liquidator, assignee, custodian, trustee or sequestrator (or other similar official) of N.H.S. or for any substantial part of the property thereof or ordering the winding-up or liquidation of the affairs of N.H.S. and the continuance of any such decree or order unstayed and in effect for a period of 30 consecutive days;

(e) the commencement by N.H.S. of a voluntary case under the federal bankruptcy laws, as now or hereafter constituted, or any other applicable federal or state bankruptcy, insolvency or other similar law, or the consent by N.H.S. to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian or sequestrator (or other similar official) of N.H.S. or of any substantial part of the property of N.H.S. or of any royalties, revenues, rents, issues or profits therefrom, or the making by N.H.S. of any assignment for the benefit of creditors or the failure of N.H.S. generally to pay its respective debts as such debts become due or the taking of action by N.H.S. in furtherance of any of the foregoing;

82464

JOURNAL-CITY COUNCIL-CHICAGO

1/13/2010

(f) a final judgment for the payment of money in excess of One Hundred Thousand Dollars ($100,000) shall be rendered by a court of competent jurisdiction against N.H.S., and N.H.S. shall not discharge the same or provide for its discharge in accordance with its terms, or procure a stay of execution thereof, within sixty (60) days from the date of entry thereof, or such longer period during which execution of such judgment shall have been stayed;

(g) default by N.H.S. under any other agreement which N.H.S. may currently have or may enter into with the City during the term of this Agreement; or

(h) a failure by N.H.S. to fulfill its obligations under any Grant Documents.

5.2 Remedies.

If any event referred to in Section 5.1 hereof cannot reasonably be cured within thirty (30) days after receipt of notice given in accordance with the terms of this Agreement, or if N.H.S. has failed, in the sole opinion of the City, to commence and continue diligent efforts to cure such event, the City may, at its sole option, declare an Event of Default hereunder. Whether to declare an Event of Default hereunder is within the sole discretion of the City and neither that decision nor the factual basis for it is subject to review or challenge under this Agreement. Written notification of, or that results in, an Event of Default, and any intention of the City to terminate this Agreement, shall be provided to N.H.S. and such decision shall be final and effective upon receipt of such notice pursuant to Section 6.14 hereof and failure to cure within the stated applicable cure period. Upon the giving of such notice, the City may invoke any or all of the following remedies:

(a) the right to terminate this Agreement as to any or all of the services yet to be performed effective at a time specified by the City;

(b) the right of specific performance, an injunction or any other appropriate equitable remedy;

(d) the right to withhold all or any part of the compensation of N.H.S. hereunder; and

(e) the right to deem N.H.S. non-responsible in future contracts to be awarded by the City.

If the City considers it to be in its best interests, it may elect not to declare an Event of Default hereunder or to terminate this Agreement. The parties acknowledge that this provision is solely for the benefit of the City and that if the City permits N.H.S. to continue to provide the services despite one or more Events of Default, N.H.S. shall in no way be relieved of any of its responsibilities, duties or obligations under this Agreement nor shall the City waive or relinquish any of its rights thereby.

1/13/2010

REPORTS OF COMMITTEES

82465

The remedies under the terms of this Agreement are not intended to be exclusive of any other remedies provided, but each and every such remedy shall be cumulative and shall be in addition to any other remedies, existing now or hereafter, at law, in equity or by statute. No delay or failure to exercise any right or power accruing upon any Event of Default shall impair any such right or power nor shall it be construed as a waiver of any Event of Default or acquiescence therein, and every such right and power may be exercised from time to time and as often as may be deemed expedient.

Article VI. General Provisions.

6.1 Duration Of The Agreement.

This Agreement shall commence on the date of execution and delivery hereof and, unless earlier terminated pursuant to this Agreement, shall terminate when the last Grant payment is made by N.H.S. hereunder.

6.2 Termination.

The City may terminate this Agreement for convenience upon thirty (30) days written notice from the City. In such event, all rights and obligations running to and from each party shall be terminated and of no further force and effect; provided that N.H.S. shall be obligated to maintain all records and monitoring obligations with respect to any Grant made in accordance with the terms of this Agreement for a period of five years after the date of the Grant.

6.3 Indemnification.

N.H.S. shall pay, indemnify and save the City and the City's officers, employees and agents harmless of, from and against, any and all losses incurred by any such party under this Agreement and any claim brought by reason of any such loss. In the event that any claim is brought against the City or any of the City's officers, employees or agents, by reason of any such loss, N.H.S., upon notice from the City, covenants to resist and defend such claim on behalf ofthe City and 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 and the fees and expenses of such counsel incurred shall be at the expense of N.H.S., without regard to any authorization of such employment by N.H.S.

6.4 Non-Liability Of Public Officials.

No official, employee or agent ofthe City shall be charged personally by N.H.S. or by any assignee or subcontractor of N.H.S. with any liability or expenses of defense or shall be held

82466

JOURNAL-CITY COUNCIL-CHICAGO 1/13/2010

personally liable to N.H.S., or any assignee or subcontractor of N.H.S. under any terms or provisions of this Agreement because ofthe City's execution or attempted execution hereof or because of any breach hereof.

6.5 Compensation.

N.H.S. shall not charge any Eligible Homeowner any fees or charges for a Grant hereunder. The only compensation received by N.H.S. for performance under this Agreement shall be in accordance with this Section. N.H.S. shall be entitled to compensation hereunder in an amount equal to fifteen percent (15%) of the aggregate Program Funds paid by the City for Eligible Costs hereunder each month; such amount shall be payable upon submission of a Voucher by N.H.S. to D.C.D., which Voucher shall contain a line item for N.H.S. compensation hereof. The City shall not be responsible for the payment of any fees other than as set forth in this Section.

6.6 Documentation Of Costs And Income; Records And Availability.

All Eligible Costs paid from the proceeds of a Grant shall be supported by properly executed invoices, contracts or vouchers, or other official documentation evidencing in proper detail the nature and propriety of the Eligible Costs. All checks, invoices, contracts, vouchers, orders or other accounting documents pertaining in whole or in part to this Agreement shall be maintained by N.H.S. and shall be clearly identified and readily accessible to the City upon written request.

N.H.S. shall maintain records evidencing compliance with all requirements of the Program for each Qualified Housing Unit which is the subject of a Grant, including the provisions of Section 4.5. Such records shall be maintained for a period of five years after the date ofthe Grant. All Grant Documents shall be held by N.H.S., for the benefit of the City during the term of this Agreement and for five years thereafter. Upon the written request of the City, N.H.S. shall provide the City with access to and copies of such records.

At any time during normal business hours and as often as the City may deem necessary, N.H.S. shall make available to the City (i) all of its records with respect to matters covered by this Agreement and (ii) access to its employees who have knowledge about the matters covered by this Agreement. N.H.S. shall permit the City to audit, examine and make excerpts or transcripts from such records, and to make copies of records relating to personnel, conditions of employment and other data covered by this Agreement.

At any time during normal business hours and as often as the City may deem necessary, each Eligible Homeowner shall make available to the City the Qualified Housing Unit and records relating to tenants ofthe unit, if any, in order for the City to verify compliance with this Agreement, including Section 4.5. N.H.S. shall include this requirement in the Grant Documents.

1/13/2010

REPORTS OF COMMITTEES

82467

6.7 Nondiscrimination.

N.H.S. agrees it shall be an unlawful employment practice for N.H.S. (1) to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, or the terms, conditions, or privileges of his employment, because of such individual's race, color, religion, sex, age, handicap or national origin; or (2) to limit, segregate, or classify its employees or applicants for employment in any way which would deprive or tend to deprive any individual in any way of employment opportunities or otherwise adversely affect his status as an employee, because of such individual's race, color religion, sex, age, handicap or national origin.

N.H.S. shall comply with the Illinois Human Rights Act, 775 ILCS 5/1-101, et seq. and any rules and regulations promulgated in accordance therewith, including, but not limited to the Equal Employment Opportunity clause, 56 III. Admin. Code 2520 Appendix G. Furthermore, N.H.S. shall comply with and shall cause any contractor utilized under this Agreement to comply with the Discrimination in Public Contracts Act, 775 ILCS 10/0.01, et seq.

6.8 City Requirements.

N.H.S. shall comply with the Chicago Human Rights Ordinance, ch. 2.160, Section 2-160-010, et seq. of the Chicago Municipal Code (1990); and the Chicago Fair Housing Regulations Ch. 5-8, Section 5-8-010, etseq. of the Chicago Municipal Code (1990).

N.H.S. agrees to furnish and to cause each of its subcontractor(s) to furnish such reports and information as requested by the Chicago Commission on Human Relations.

N.H.S. agrees that all of the aforementioned provisions will be incorporated in all agreements entered into with any suppliers of materials, furnisher of services, subcontractors of any tier, and labor organizations which furnish skilled, unskilled and craft union skilled labor, or which may provide any such materials, labor of services in connection with this Agreement.

6.9 Assignment.

N.H.S. may not assign, sell, transfer or delegate any of its duties or obligations under this Agreement without the prior written consent of the City. The City may assign, sell, transfer or otherwise dispose of any of its rights hereunder, in whole or in part, without the permission of N.H.S.

6.10 Savings Clause.

In case any provision of this Agreement is held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not be affected.

82468 JOURNAL-CITY COUNCIL-CHICAGO 1/13/2010

6.11 Entire Agreement.

This Agreement and the incorporated exhibits constitute the entire Agreement and may not be modified, altered or amended unless agreed to by both parties in writing. Any waiver or any provision of this Agreement must be executed in writing by the party granting the waiver and such waiver shall not affect any other rights of the party granting the waiver or act to affect any other duty or obligation of the party receiving the waiver.

6.12 Counterparts.

This Agreement is composed of several identical counterparts, each to be fully executed by the parties and each to be deemed an original having identical legal effect.

6.13 Headings.

The headings and titles of this Agreement are for convenience only and shall not influence the construction or interpretation of this Agreement.

6.14 Notices.

Unless otherwise specified, any notice, demand or request 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; or (d) registered or certified mail, return receipt requested.

If To City: Department of Community Development

City of Chicago

121 North LaSalle Street, Room 1006 Chicago, Illinois 60602 Attention: Commissioner

with copies to:

Office of the Corporation Counsel City of Chicago City Hall, Room 600 121 North LaSalle Street Chicago, Illinois 60602 Attention: Finance & Economic

Development Division

1/13/2010

REPORTS OF COMMITTEES

82469

and

Department of Finance City of Chicago

33 North LaSalle Street, Room 600 Chicago, Illinois 60602 Attention: Comptroller

If To N.H.S.: Neighborhood Housing Services of Chicago,

Inc.

1279 North Milwaukee Avenue, 5^lh Floor Chicago, Illinois 60622 Attention: Executive Director

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. 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, deemed or request sent pursuant to clause (d) above shall be deemed received two business days following deposit in the mail.

6.15 Governing Law.

This Agreement shall be governed by and construed in accordance with the internal laws of the State without regard to its conflict of laws principles.

6.16 Approval.

Wherever in this Agreement provision is made for the approval or consent of the City, or any matter is to be to the City's satisfaction, or the like, unless specifically stated to the contrary, such approval, consent, satisfaction or the like shall be made, given or determined by the City in its sole discretion, subject to the review by the Corporation Counsel. Any such approval, consent or other determination shall be made by the Commissioner of the Department of Community Development, or any designee thereof, in his or her role as administering this Agreement for the City.

6.17 Standard Of Performance. N.H.S. shall at all times act in the best interest ofthe City, consistent with the professional

82470

JOURNAL-CITY COUNCIL-CHICAGO 1/13/2010

obligations assumed by it in entering into this Agreement. N.H.S. shall perform, or cause to be performed, all services hereunder in accordance with the terms and conditions of this Agreement and to the reasonable satisfaction ofthe City. Any review, approval, acceptance or payment for any and all of the services by the City shall not relieve N.H.S. of its responsibility for the professional accuracy and due diligence of its services. This provision in no way limits the City's rights against N.H.S. either under this Agreement or otherwise, at law or in equity.

6.18 References To Statutes, Et Cetera.

All references herein to statutes, regulations, rules, executive orders, ordinances, resolutions or notices or circulars issued by any governmental body shall be deemed to include any and all amendments, supplements and restatements from time to time to or of such statutes, regulations, rules, executive orders, ordinances, resolutions, notices and circulars.

6.19 No Contractor Inducements.

N.H.S. shall comply with Chapter 2-156 ofthe Municipal Code of Chicago, "Governmental Ethics", including but not limited to Section 2-156-120 of such Chapter, pursuant to which no payment, gratuity or offer of employment shall be made in connection with any City contract, by or on behalf of a subcontractor to the prime contractor or higher tier subcontractor or any person associated therewith, as an inducement for the award of a subcontract or order. Any contract negotiated, entered into, or performed in violation of any ofthe provisions of such Chapter 2-156 shall be voidable as to the City.

6.20 No Business Relationship With City Elected Officials.

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 2-156-080 of the Municipal Code of Chicago), or to participate in any discussion of 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.this Agreement, or in connection with the transactions contemplated hereby, shall be grounds for termination of this Agreement and the transactions contemplated hereby. N.H.S. 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 this Agreement or the transactions contemplated hereby,

1/13/2010

REPORTS OF COMMITTEES

82471

In Witness Whereof, The City and N.H.S. have executed this Agreement as ofthe date first set forth above.

City of Chicago By: _

Acting Commissioner of Community Development

Neighborhood Housing Services of Chicago, Inc.

By: Its:

(Sub)Exhibit "A" referred to in this T.I.F. Neighborhood Housing Program Agreement with Neighborhood Housing Services of Chicago, Inc. reads as follows:

(Sub)Exhibit "A". (To T.I.F. Neighborhood Housing Program Agreement With Neighborhood Housing Services Of Chicago, Inc.)

Form Of Counsel's Opinion. [To Be Placed On Attorney's Letterhead]

Office of the Corporation Counsel City of Chicago City Hall, Room 600 121 North LaSalle Street Chicago, Illinois 60602

Attention: Finance and Economic Development Division

Re: T.I.F. Neighborhood Improvement Program Agreement (the "Agreement")

Ladies and Gentlemen: I have acted as counsel for Neighborhood Housing Services of Chicago, Inc., an Illinois

82472

JOURNAL-

-CITY COUNCIL-CHICAGO

1/13/2010

not-for-profit corporation ("N.H.S."), in connection with the execution and delivery of the Agreement by and among N.H.S. and the City of Chicago, acting by and through its Department of Community Development (the "City"). N.H.S. has requested that this opinion be furnished to the City.

In so acting as counsel for N.H.S. I have examined:

(i) an executed original of the Agreement;

(ii) the Articles of Incorporation, including all amendments thereto, of N.H.S. as furnished and certified by the Secretary of State of the State of Illinois;

(iii) the bylaws of N.H.S., as certified by the Secretary of N.H.S. as of the date hereof; and

(iv) the Certificate of Good Standing dated_, issued by the Office of the

Secretary of State of the State of Illinois, as to the good standing of N.H.S.

In my capacity as counsel, I have also examined such other documents or instruments as I have deemed relevant for the purposes of rendering the opinions hereinafter set forth.

I have also assumed, but have no reason to question, the legal capacity, authority and the genuineness ofthe signatures of and due and proper execution and delivery by the respective parties other than N.H.S. which has made, executed or delivered or will make, execute and deliver the agreements and documents examined by me.

I express no opinion as to (i) the laws of any state or jurisdiction other than the State of Illinois (and any political subdivisions thereof) and the United States of America; and (ii) any matters pertaining or relating to the securities laws of the United States of America, the State of Illinois or any other state.

Based upon and subject to the assumptions and qualifications herein stated, it is my opinion that:

1. N.H.S. is a not-for-profit corporation, duly organized and validly existing under the laws of the State of Illinois, N.H.S. has made all filings required by the laws of the State of Illinois in respect of its formation and continuing existence, and has all requisite authority to carry on its business and to execute and deliver, and to consummate the transactions contemplated by, the Agreement.

2. The Agreement has been duly executed and delivered on behalf of N.H.S., and constitutes a legal, valid and binding obligation of N.H.S., enforceable against N.H.S. in accordance with its terms, except to the extent that enforcement of any such terms may be limited by: (a) applicable bankruptcy, reorganization, debt arrangement,

1/13/2010

REPORTS OF COMMITTEES

82473

insolvency or other similar laws generally affecting creditors' rights; or (b) judicial and public policy limitations upon the enforcement of certain remedies including those which a court of equity may in its discretion decline to enforce.

3. There is no action, suit or proceeding at law or in equity pending, nor to my knowledge threatened, against or affecting N.H.S., before any court or before any governmental or administrative agency, which if adversely determined could materially and adversely affect the ability of either N.H.S- or N.H.S., to perform under the Agreement or any of its business or properties or financial or other conditions.

4. The transactions contemplated by the Agreement are governed by the laws of the State of Illinois.

5. The execution and delivery of the Agreement and the consummation of the transactions contemplated thereby will not constitute:

A. a violation or breach of (i) the Articles of Incorporation of N.H.S., (ii) the bylaws of N.H.S., (iii) any provision of any contract or other instrument to which N.H.S. is bound, or (iv) any order, writ, injunction, decree, statute, rule or regulation binding on N.H.S., or

B. a breach of any of the provisions of, or constitute a default under, or result in the creation or imposition of any lien or encumbrance upon any of the property of either N.H.S. pursuant to, any agreement or other instrument to which N.H.S. is a party or by which N.H.S. is bound.

Very truly yours,

ATTACHMENT D

Doo#: 1101033188 Fee: $180,00

Eugene "Qene" Mooro

Cook County Beoorder ot Deeds

Date: 01/10/2011 02:18 PM Pg: 1 ol 73

This agreement was prepared by and after recording return to:

Keith A. May, Esq. City of Chicago Law Department 121 North LaSalle Street, Room 600 Chicago, IL 60602

GX CHICAGO. LLC REDEVELOPMENT AGREEMENT BY AND BETWEEN

THE CITY OF CHICAGO AND

GX CHICAGO, LLC

PIN:

13-25-404-001-0000

pfe

Addison South Redevelopment Project Area

1101033196 Page: 2 of 73

GX CHICAGO. LLC REDEVELOPMENT AGREEMENT

This GX Chicago, LLC Redevelopment Agreement (this "Agreement") is made as of this ^J? day of December, 2010, by and between the City of Chicago, an Illinois municipal corporation (the "City"), through its Department of Community Development ("DCD"), and GX Chicago, LLC, an Illinois limited liability company (the "Developer")-

RECITALS

A. Constitutional Authority: As a home rule unit of government under Section 6(a), Article VII of the 1970 Constitution of the State of Illinois (the "State"), the City has the power to regulate for the protection of the public health, safety, morals and welfare of its inhabitants, and pursuant thereto, has the power to encourage private development in order to enhance the local tax base, create employment opportunities and to enter into contractual agreements with private parties in order to achieve these goals.

B. Statutory Authority: The City is authorized under the provisions of the Tax Increment Allocation Redevelopment Act. 65 ILCS 5/11-74.4-1 et seg., as amended from time to time (the "Act"), to finance projects that eradicate blighted conditions and conservation area factors through the use of tax increment allocation financing for redevelopment projects.

C. City Council Authority: To induce redevelopment pursuant to the Act, the City Council of the City (the "City Council") adopted the following ordinances on May 9,2007: (1) "An Ordinance of the City of Chicago, Illinois Approving a Redevelopment Plan for the Addison South Redevelopment Project Area"; (2) "An Ordinance of the City of Chicago, Illinois Designating the Addison South Redevelopment Project Area as a Redevelopment Project Area Pursuant to the Tax Increment Allocation Redevelopment Act"; and (3) "An Ordinance of the City of Chicago, Illinois Adopting Tax Increment Allocation Financing for the Addison South Redevelopment Project Area" (the "TIF Adoption Ordinance") (items(1)-(3) collectively referred to herein as the "TIF Ordinances"). The redevelopment project area referred to above (the "Redevelopment Area") is legally described in Exhibit A hereto.

D. The Proiect: The Developer has purchased (the "Acquisition") certain property located within the Redevelopment Area at 2545 West Diversey Avenue, Chicago, Illinois 60647 and legally described on Exhibit B hereto (the "Property"), and, within the time frames set forth in Section

1101033196 Page: 3 of 73

3.01 hereof, shall commence and complete the rehabilitation of an approximately 272,000 square foot building (the "Facility") thereon. The proposed project, to be known as the "Green Exchange," will be a multi-tenant commercial project that upon completion will operate as an incubator facility for green businesses committed to environmental sustainability with a combination of uses, including retail, light industrial, light manufacturing, product assembly, office space, work-live spaces, shared office space, exhibition space and common areas. It is anticipated that 450 permanent jobs will be created. The Facility and related improvements (including but not limited to those TIF-Funded Improvements as defined below and set forth on Exhibit C) are collectively referred to herein as the "Project." The completion of the Project would not reasonably be anticipated without the financing contemplated in this Agreement.

E. Redevelopment Plan: The Project will be carried out in accordance with this Agreement and the City of Chicago Addison South TIF Redevelopment Plan and Project (the "Redevelopment Plan") attached hereto as Exhibit D.

F. City Financing: The City agrees to use, in the amounts set forth in Section 4.03 hereof, (i) the proceeds ofthe City Note (defined below) and/or (ii) Available Incremental Taxes (as defined below), to pay for or reimburse the Developer for the costs of TIF-Funded Improvements pursuant to the terms and conditions of this Agreement and the City Note.

In addition, the City may, in its discretion, issue tax increment allocation bonds ("TIF Bonds") secured by Incremental Taxes pursuant to a TIF bond ordinance (the "TIF Bond Ordinance") at a later date as described in Section 4.03(d) hereof, the proceeds of which (the "TIF Bond Proceeds") may be used to pay for the costs of the TIF-Funded Improvements not previously paid for from Available Incremental Taxes (including any such payment made pursuant to any City Note provided to the Developer pursuant to this Agreement), to make payments of principal and interest on the City Note, or in order to reimburse the City for the costs of TIF-Funded Improvements.

Now, therefore, in consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

SECTION 1. RECITALS

The foregoing recitals are hereby incorporated into this agreement by reference.

1101033196 Page: 4 of 73

SECTION 2. DEFINITIONS

For purposes of this Agreement, in addition to the terms defined in the foregoing recitals, the following terms shall have the meanings set forth below:

"Act" shall have the meaning set forth in the Recitals hereof.

"Actual residents of the City" shall mean persons domiciled within the City.

"Acquisition" shall have the meaning set forth in the Recitals hereof.

"Addison South TIF Fund" shall mean the special tax allocation fund created by the City in connection with the Redevelopment Area into which the Incremental Taxes will be deposited.

"Affiliate" shall mean any person or entity directly or indirectly controlling, controlled by or under common control with the Developer.

"Annual Compliance Report' shall mean a signed report from the Developer to the City (a) itemizing each ofthe Developer's obligations under the RDA during the preceding calendar year, (b) certifying the Developer's compliance or noncompliance with such obligations, (c) attaching evidence (whether or not previously submitted to the City) of such compliance or noncompliance and (d) certifying that the Developer is not in default with respect to any provision of the RDA, the agreements evidencing the Lender Financing, if any, or any related agreements; provided, that the obligations to be covered by the Annual Compliance Report shall include the following: (1) compliance with the Operating Covenant (Section 8.06): (2) compliance with the Jobs Covenant (Section 8.06): (3) delivery of Financial Statements and unaudited financial statements (Section 8.13); (4) delivery of updated insurance certificates, if applicable (Section 8.14); (5) delivery of evidence of payment of Non-Governmental Charges, if applicable (Section 8.15); (6) delivery of evidence that LEED Gold Certification has been obtained; (7) notification of obligation to report transaction that could result in payments to the City; and (8) compliance with all other executory provisions of the RDA.

1101033196 Page: 5 of 73

"Available Incremental Taxes" shall mean an amount equal to the Incremental Taxes deposited in the Addison South TIF Fund attributable to the taxes levied on the Property, as adjusted to reflect the amount of the City Fee described in Section 4.05(c) hereof.

"Available Proiect Funds" shall have the meaning set forth for such term in Section 4.07

hereof.

"Bond(s)" shall have the meaning set forth for such term in Section 8.05 hereof.

"Bond Ordinance" shall mean the City ordinance authorizing the issuance of Bonds.

"Business Relationship" shall have the meaning set forth for such term in Section 2-156-080 of the Municipal Code of Chicago.

"Certificate" shall mean the Certificate of Completion of Rehabilitation described in Section 7.01 hereof.

"Certificate of Expenditure" shall mean any Certificate of Expenditure referenced in the City Note pursuant to which the principal amount of the City Note will be established.

"Change Order" shall mean any amendment or modification to the Scope Drawings, Plans and Specifications or the Project Budget as described in Section 3.03. Section 3.04 and Section 3.05, respectively.

"City Contract" shall have the meaning set forth in Section 8.01(1) hereof.

"City Council" shall have the meaning set forth in the Recitals hereof.

"City Fee" shall mean the fee described in Section 4.05(c) hereof.

"City Funds" shall mean the funds paid to the Developer pursuant to the City Note.

"City Note" shall mean the City of Chicago Tax Increment Allocation Revenue Note (Green Exchange), Taxable Series 2010, to be in the form attached hereto as Exhibit M. in the maximum principal amount of $10,000,000, issued by the City to the Developer as provided herein. The Note

1101033196 Page: 6 of 73

shall be taxable and shall bear interest at an annual rate that is the median value of the 10-year Treasury rate for 15 business days~prior to the issuance date plus 300 basis points, not to exceed 8% percent and shall not provide for accrued, but unpaid, interest to bear interest at the same annual rate.

"Closing Date" shall mean the date of execution and delivery of this Agreement by all parties hereto, which shall be deemed to be the date appearing in the first paragraph of this Agreement.

"Completion Date" shall mean the date the City issues the Certificate of Completion of Rehabilitation described in Section 7.01 hereof.

"Contract" shall have the meaning set forth in Section 10.03 hereof.

"Contractor" shall have the meaning set forth in Section 10.03 hereof.

"Construction Contract" shall mean that certain contract, substantially in the form attached hereto as Exhibit E. to be entered into between the Developer and the General Contractor providing for construction of the Project.

"Corporation Counsel" shall mean the City's Office of Corporation Counsel.

"Employees)" shall have the meaning set forth in Section 10 hereof.

"Environmental Laws" shall mean any and all federal, state or local statutes, laws, regulations, ordinances, codes, rules, orders, licenses, judgments, decrees or requirements relating to public health and safety and the environment now or hereafter in force, as amended and hereafter amended, including but not limited to (i) the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. Section 9601 et seg.); (ii) any so-called "Superfund" or "Superlien" law; (iii) the Hazardous Materials Transportation Act (49 U.S.C. Section 1802 et seq.); (iv) the Resource Conservation and Recovery Act (42 U.S.C. Section 6902 et seg.); (v) the Clean Air Act (42 U.S.C. Section 7401 et seg ); (vi) the Clean Water Act (33 U.S.C. Section 1251 et seg.); (vii) the Toxic Substances Control Act (15 U.S.C. Section 2601 et seg.); (viii) the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. Section 136 et seg.); (ix) the Illinois Environmental Protection Act (415 ILCS 5/1 et seg.); and (x) the Municipal Code of Chicago.

1101033196 Page: 7 of 73

"Equity" shall mean funds of the Developer (other than funds derived from Lender Financing) irrevocably available for the Project, in the amount set forth in Section 4,01 hereof, which amount may be increased pursuant to Section 4.03(b) (Sources of City Funds) or Section 4,06 (Cost Overruns).

"Escrow" shall mean the construction escrow established pursuant to the Escrow Agreement.

"Escrow Agreement" shall mean the Escrow Agreement establishing a construction escrow, to be entered into as of the date hereof by the Ciity, the Title Company (or an affiliate of the Title Company), the Developer and the Developer's lender(s), substantially in the form of Exhibit F attached hereto.

"Event of Default" shall have the meaning set forth in Section 15 hereof. "Facility" shall have the meaning set forth in the Recitals hereof.

"Financial Statements" shall mean complete audited financial statements of the Developer prepared by a certified public accountant in accordance with generally accepted accounting principles and practices consistently applied throughout the appropriate periods.

"General Contractor" shall mean the general contractor(s) hired by the Developer pursuant to Section 6.01.

"Hazardous Materials" shall mean any toxic substance, hazardous substance, hazardous material, hazardous chemical or hazardous, toxic or dangerous waste defined or qualifying as such in (or for the purposes of) any Environmental Law, or any pollutant or contaminant, and shall include, but not be limited to, petroleum (including crude oil), any radioactive material or by-product material, polychlorinated biphenyls and asbestos in any form or condition.

"HUD" shall mean the United States Department of Housing and Urban Development.

"Human Rights Ordinance" shall have the meaning set forth in Section 10 hereof.

"In Balance" shall have the meaning set forth in Section 4.07 hereof.

1101033196 Page: 8 of 73

"Incremental Taxes" shall mean such ad valorem taxes which, pursuant to the TIF Adoption Ordinance and Section 5/11 -74.4-8(b) of the Act, are allocated to and when collected are paid to the Treasurer of the City of Chicago for deposit by the Treasurer into the Addison South TIF Fund established to pay Redevelopment Project Costs and obligations incurred in the payment thereof.

"Indemnitee" and "Indemnitees" shall have the meanings set forth in Section 13.01 hereof.

"Lender Financing" shall mean funds borrowed by the Developer from lenders and irrevocably available to pay for Costs of the Project, in the amount set forth in Section 4.01 hereof.

"MBE(s)" shall mean a business 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, related to the Procurement Program or the Construction Program, as applicable.

"MBEAA/BE Budget" shall mean the budget attached hereto as Exhibit H-2. as described in Section 10.03.

"MBEAA/BE Program" shall have the meaning set forth in Section 10.03 hereof.

"Municipal Code" shall mean the Municipal Code of the City of Chicago.

"New Mortgage" shall have the meaning set forth in Article 16 hereof.

"Non-Governmental Charges" shall mean all non-governmental charges, Hens, claims, or encumbrances relating to the Developer, the Property or the Project.

"Permitted Liens" shall mean those liens and encumbrances against the Property and/or the Project set forth on Exhibit G hereto.

"Permitted Mortgage" shall have the meaning set forth in Article 16 hereof.

1101033196 Page: 9 of 73

"Plans and Specifications" shall mean final construction documents containing a site plan and working drawings and specifications for the Project, as submitted to the City as the basis for obtaining building permits for the Project.

"Prior Expenditure^)" shall have the meaning set forth in Section 4.05(a) hereof.

"Proiect" shall have the meaning set forth in the Recitals hereof.

"Proiect Budget" shall mean the budget attached hereto as Exhibit H-1. showing the total cost ofthe Project by line item, furnished by the Developer to DCD, in accordance with Section 3.03 hereof.

"Property" shall have the meaning set forth in the Recitals hereof,

"Redevelopment Area" shall have the meaning set forth in the Recitals hereof.

"Redevelopment Plan" shall have the meaning set forth in the Recitals hereof.

"Redevelopment Proiect Costs" shall mean redevelopment project costs as defined in Section 5/11 -74.4-3(q) of the Act that are included in the budget set forth in the Redevelopment Plan or otherwise referenced in the Redevelopment Plan.

"Reguisition Form" shall mean the document, in the form attached hereto as Exhibit L. to be delivered by the Developer to DCD pursuant to Section 4.04 of this Agreement.

"Scope Drawings" shall mean preliminary construction documents containing a site plan and preliminary drawings and specifications for the Project.

"Section 108 Loan" shall mean that certain loan that Developer expects to receive from HUD, through the City, pursuant to the Community Development Block Grant Program.

"Survey" shall mean a Class A plat of survey in the most recently revised form of ALTA/ACSM land title survey of the Property dated within 45 days prior to the Closing Date, acceptable in form and content to the City and the Title Company, prepared by a surveyor registered in the State of Illinois, certified to the City and the Title Company, and indicating whether the

1101033196 Page: 10 of 73

Property is in a flood hazard area as identified by the United States Federal Emergency Management Agency (and updates thereof to reflect improvements to the Property in connection with the construction of the Facility and related improvements as required by the City or lenders) providing Lender Financing).

"Term of the Agreement" shall mean the period of time commencing on the Closing Date and ending on the later of: (a) twenty (20) years from the Closing Date or (b) the date on which the Redevelopment Area is no longer in effect.

"TIF Adoption Ordinance" shall have the meaning set forth in the Recitals hereof.

"TIF Bonds" shall have the meaning set forth in the Recitals hereof.

"TIF Bond Ordinance" shall have the meaning set forth in the Recitals hereof.

"TIF Bond Proceeds" shall have the meaning set forth in the Recitals hereof

"TIF-Funded Improvements" shall mean those improvements of the Project which (i) qualify as Redevelopment Project Costs, (ii) are eligible costs under the Redevelopment Plan and (iii) the City has agreed to pay for out of the City Funds, subject to the terms of this Agreement. Exhibit C lists the TIF-Funded Improvements for the Project.

"TIF Ordinances" shall have the meaning set forth in the Recitals hereof.

"Title Company" shall mean Chicago Title Insurance Company.

"Title Policy" shall mean a title insurance policy in the most recently revised ALTA or equivalent form, showing the Developer as the insured, noting the recording of this Agreement as an. encumbrance against the Property, and a subordination agreement in favor of the City with respect to previously recorded liens against the Property related to Lender Financing, if any, issued by the Title Company.

"WARN Act" shall mean the Worker Adjustment and Retraining Notification Act (29 U.S.C. Section 2101 et seq.).

1101033196 Page: 11 of 73

"WBEfs)" shall mean a business 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, related to the Procurement Program or the Construction Program, as applicable.

SECTION 3. THE PROJECT

3.01 The Proiect. With respect to the Facility, the Developer shall, pursuant to the Plans and Specifications and subject to the provisions of Section 18.17 hereof: (i) commence construction no later than June 30, 2010; and (II) complete construction and conduct business operations therein no later than June 30, 2012.

3.02 Scope Drawings and Plans and Specifications. The Developer has delivered the Scope Drawings and Plans and Specifications to DCD and DCD has approved same. After such initial approval, subsequent proposed changes to the Scope Drawings or Plans and Specifications shall be submitted to DCD as a Change Order pursuant to Section 3.04 hereof. The Scope Drawings and Plans and Specifications shall at all times conform to the Redevelopment Plan and all applicable federal, state and local laws, ordinances and regulations. The Developer shall submit all necessary documents to the City's Building Department, Department of Transportation and such other City departments or governmental authorities as may be necessary to acquire building permits and other required approvals for the Project.

3.03 Proiect Budget. The Developer has furnished to DCD, and DCD has approved, a Project Budget showing total costs for the Project in an amount not less than Fifty-Four Million Two Hundred Fifty-Five Thousand and Eight Hundred and Nine Dollars ($54,255,809). The Developer hereby certifies to the City that (a) it has Lender Financing and Equity in an amount sufficient to pay for all Project costs; and (b) the Project Budget is true, correct and complete in all material respects. The Developer shall promptly deliver to DCD certified copies of any Change Orders with respect to the Project Budget for approval pursuant to Section 3.04 hereof.

3.04 Change Orders. Except as provided below, all Change Orders (and documentation substantiating the need and identifying the source of funding therefor) relating to material changes to the Project must be submitted by the Developer to DCD concurrently with the progress reports described in Section 3.07 hereof; provided, that any Change Order relating to any of the following must be submitted by the Developer to DCD for DCD's prior written approval: (a) a reduction in the

1101033196 Page: 12 of 73

square footage of the Facility; (b) a change in the use ofthe Property to a use other than the Project description contained in Recital D, above; (c) a delay in the completion ofthe Project; or (d) Change Orders costing more than an aggregate amount of $3,000,000. The Developer shall not authorize or permit the performance of any work relating to any Change Order or the furnishing of materials in connection therewith prior to the receipt by the Developer of DCD's written approval (to the extent required in this section). The Construction Contract, and each contract between the General Contractor and any subcontractor, shall contain a provision to this effect. An approved Change Order shall not be deemed to imply any obligation on the part ofthe City to increase the amount of City Funds which the City has pledged pursuant to this Agreement or provide any other additional assistance to the Developer. Notwithstanding anything to the contrary in this Section 3.04. Change Orders costing less than an aggregate amount of $3,000,000, do not require DCD's prior written approval as set forth in this Section 3.04. but DCD shall be notified in writing of all such Change Orders prior to the implementation thereof and the Developer, in connection with such notice, shall identify to DCD the source of funding therefor. Further, approval from the Commission on Chicago Landmarks shall be required prior to any changes that would affect the exterior of the Facility.

3.05 DCD Approval. Any approval granted by DCD of the Scope Drawings, Plans and Specifications and the Change Orders is for the purposes of this Agreement only and does not affect or constitute any approval required by any other City department or pursuant to any City ordinance, code, regulation or any other governmental approval, nor does any approval by DCD pursuant to this Agreement constitute approval of the quality, structural soundness or safety of the Property or the Project.

3.06 Other Approvals. Any DCD approval under this Agreement shall have no effect upon, nor shall it operate as a waiver of, the Developer's obligations to comply with the provisions of Section 5.03 (Other Governmental Approvals) hereof. The Developer shall not commence construction of the Project until the Developer has obtained all necessary permits and approvals (including but not limited to DCD's approval ofthe Scope Drawings and Plans and Specifications) and proof of the General Contractor's and each subcontractor's bonding as required hereunder.

3.07 Progress Reports and Survey Updates. The Developer shall provide DCD with written quarteriy progress reports detailing the status ofthe Project, including a revised completion date, if necessary (with any change in completion date being considered a Change Order, requiring DCD's written approval pursuant to Section 3.04). The Developer shall provide three (3) copies of an

1101033196 Page: 13 of 73

updated Survey to DCD upon the request of DCD or any lender providing Lender Financing, reflecting improvements made to the Property.

3.08 Inspecting Agent or Architect. An independent agent or architect (other than the Developer's architect) approved by DCD shall be selected to act as the inspecting agent or architect, at the Developer's expense, for the Project. The inspecting agent or architect shall perform periodic inspections with respect to the Project, providing certifications with respect thereto to DCD, prior to requests for disbursement for costs related to the Project.

3.09 Barricades. Prior to commencing any construction requiring barricades, the Developer shall install a construction barricade of a type and appearance satisfactory to the City and constructed in compliance with all applicable federal, state or City laws, ordinances and regulations. DCD retains the right to approve the maintenance, appearance, color scheme, painting, nature, type, content and design of all barricades.

3.10 Signs and Public Relations. The Developer shall erect a sign of size and style approved by the City in a conspicuous location on the Property during the Project, indicating that financing has been provided by the City. The City reserves the right to include the name, photograph, artistic rendering ofthe Project and other pertinent information regarding the Developer, the Property and the Project in the City's promotional literature and communications.

3.11 Utility Connections. The Developer may connect all on-site water, sanitary, storm and sewer lines constructed on the Property to City utility lines existing on or near the perimeter of the Property, provided the Developer first complies with all City requirements governing such connections, including the payment of customary fees and costs related thereto.

3.12 Permit Fees. In connection with the Project, the Developer shall be obligated to pay only those building, permit, engineering, tap on and inspection fees that are assessed on a uniform basis throughout the City of Chicago and are of general applicability to other property within the City of Chicago.

1101033196 Page: 14 of 73

SECTION 4. FINANCING

4.01 Total Project Cost and Sources of Funds. The cost of the Project is estimated to be $56,644,323, to be applied in the manner set forth in the Project Budget. Such costs shall be funded from the following sources:

4.02 Developer Funds. Equity and/or Lender Financing may be used to pay any Project cost, including but not limited to Redevelopment Project Costs.

Developer Equity $ 12,798,920

Deferred Construction Management/Dev Fee $ 2,500,000

Historic Tax Credits $ 5,375,813

Ledcor Equity Advance $ 3,000,000

Senior Debt $ 17,969,590

HUD Section 108 Loan $ 15,000,000

ESTIMATED TOTAL $ 56,644,323

4.03 City Funds.

(a) Uses of City Funds. City Funds may only be used to pay directly or reimburse the Developer for costs of TIF-Funded Improvements that constitute Redevelopment Project Costs. Exhibit C sets forth, by line item, the TIF-Funded Improvements for the Project, and the maximum amount of costs that may be paid by or reimbursed from City Funds for each line item therein (subject to Sections 4.03(b) and 4,05(d)L contingent upon receipt by the City of documentation satisfactory in form and substance to DCD evidencing such cost and its eligibility as a Redevelopment Project Cost.

(b) Sources of City Funds. Subject to the terms and conditions of this Agreement, including but not limited to this Section 4.03 and Section 5 hereof, the City hereby agrees to provide City funds from the sources and in the amounts described directly below (the "City Funds") to pay for or reimburse the Developer for the costs of the TIF-Funded Improvements:

Source of City Funds_Maximum Amount

Available Incremental Taxes and/or

TIF Bond Proceeds $10,000,000

1101033196 Page: 15 of 73

provided, however, that the total amount of City Funds expended for TIF-Funded Improvements shall be an amount not to exceed the lesser of Ten Million Dollars ($10,000,000) or percent (18.5%) of the actual total Project costs, with such amount to be further reduced by the City Fee; and provided further, that the $10,000,000 to be derived from Available Incremental Taxes and/or TIF Bond proceeds, rf any, shall be available to pay costs related to TIF-Funded Improvements and allocated by the City for that purpose only so long as:

(i) The amount of the Available Incremental Taxes deposited into the Addison South TIF Fund shall be sufficient to pay for such costs; and

(ii) The City has been reimbursed from Available Incremental Taxes for the amount previously disbursed by the City for TIF-Funded Improvements; and

(iii) Developer has not failed to make any required payments pursuant to the HUD Section 108 Loan; or

(iv) If requested by Developer pursuant to Section 4.03(c), the City agrees to issue TIF Bonds pursuant to, and subject to the conditions set forth in, Section 4.03(c).

The Developer acknowledges and agrees that the City's obligation to pay for TIF-Funded Improvements up to a maximum of $10,000,000 is contingent upon the fulfillment ofthe conditions set forth in parts (i), (ii), (iii) and (iv) above. In the event that such conditions are not fulfilled, the amount of Equity to be contributed by the Developer pursuant to Section 4.01 hereof shall increase proportionately.

Subject to the terms and conditions of this Agreement, including but not limited to this Section 4,03 and Section 5 hereof, the City hereby agrees to issue the City Note to the Developer on the Completion Date. At its sole discretion, the City may elect to begin payments under the Note or Additional Notes at any time prior to issuance of a Certificate of Completion for the sole purpose of defraying debt service payments due to HUD under the HUD Section 108 Loan. However, issuance of the City Note is subject to certification of at least $25 million in TIF-eligible costs by Developer to, and approved by, the City prior to the Completion Date. The principal amount of the City Note shall be in an amount equal to the costs ofthe TIF-Funded Improvements which have been incurred by the Developer and are to be reimbursed by the City through payments of principal and interest on the City Note, subject to the provisions hereof; provided, however, that the maximum principal

.1101033196 Page: 16 of 73

amount of the City Note shall be an amount not to exceed the lesser of $10,000,000 or 18.5% of the actual total Project costs; and provided, however, that payments under the City Note are subject to the amount of Available Incremental Taxes deposited into the Addison South TIF Fund being sufficient for such payments. Upon issuance of the City Note, the Developer shall immediately pledge/collaterally assign the City Note to the City (or any third party designated by the City) as partial security for the HUD Section 108 Loan. At the City's discretion, the City may subsequently choose to issue one or more additional notes to the Developer secured by other incremental taxes for the sole purpose of enhancing the City's security on the HUD Section 108 Loan. The Developer agrees to cooperate with such issuances, and to pledge any additional notes to the City or the City's designee as security on the HUD Section 108 Loan. The Developer will also cooperate with any actions necessary to assign, transfer, or otherwise pledge the City Note or additional notes to other parties for the purpose of securing or prepaying the HUD Section 108 Loan.

If the HUD Section 108 Loan is retired during the term of the City Note and the City Note ceases to be pledged to the City or designee, City consent (which shall not be unreasonably withheld or delayed) is required for the City to have an obligation to pay Available Incremental Taxes to any transferee under the terms of the City Note, except to the extent that such transfer is to the Senior Lender.

(i) The Commissioner of DCD and the Comptroller, in their sole discretion, may agree upon the request ofthe Developer to recommend that the City Council approve an ordinance or ordinances authorizing the issuance of TIF Bonds in an amount which, in the opinion of the Comptroller, is marketable under the then current market conditions; provided. however, that if, in the opinion of the Comptroller, there is an insufficient market for such TIF Bonds or if the issuance of such TIF Bonds would adversely affect the City's credit rating or in any other way adversely affect City finances, such officials will not be required to recommend approval of such ordinance(s). The Developer will cooperate with the City in the issuance of TIF Bonds, as provided in Section 8.05 hereof.

(ii) Prior to the submission of any such ordinance for approval by the City Council, the Developer shall agree to pay the costs of issuing such TIF Bonds including but not limited to bond counsel fees, underwriters' fees and consultants' fees, and shall identify its source of funding with respect thereto.

1101033196 Page: 17 of 73

4.04 Requisition Form. On the Closing Date and prior to each October 1 (or such other date as the parties may agree.to) thereafter, beginning in 2012 and continuing throughout the earlier of (i) the Term ofthe Agreement or (ii) the date that the Developer has been reimbursed in full under this Agreement, the Developer shall provide DCD with a Requisition Form, along with the documentation described therein. Requisition for reimbursement of TIF-Funded Improvements shall be made not more than one time per calendar year (or as otherwise permitted by DCD). On each December 1 (or such other date as may be acceptable to the parties), beginning in 2012 and continuing throughout the Term of the Agreement, the Developer shall meet with DCD at the request of DCD to discuss the Requisition Form(s) previously delivered.

4.05 Treatment of Prior Expenditures and Subsequent Disbursements.

(a) Prior Expenditures. Only those expenditures made by the Developer with respect to the Project prior to the Closing Date, evidenced by documentation satisfactory to DCD and approved by DCD as satisfying costs covered in the Project Budget, shall be considered previously contributed Equity or Lender Financing hereunder (the "Prior Expenditures"). DCD shall have the right, in its sole discretion, to disallow any such expenditure as a Prior Expenditure. Exhibit I hereto sets forth the prior expenditures approved by DCD as of the date hereof as Prior Expenditures, Prior Expenditures made for items other than TIF-Funded Improvements shall not be reimbursed to the Developer, but shall reduce the amount of Equity and/or Lender Financing required to be contributed by the Developer pursuant to Section 4.01 hereof.

(b) Purchase of Property. No portion of the purchase price of the Property shall be reimbursed to the Developer from City Funds.

(c) City Fee. Annually, the City may allocate an amount not to exceed five percent (5%) of the Available Incremental Taxes for payment of costs incurred by the City for the administration and monitoring of the Redevelopment Area, including the Project. Such fee shall be in addition to and shall not be deducted from or considered a part of the City Funds, and the City shall have the right to receive such funds prior to any payment of City Funds hereunder.

(d) Allocation Among Line Items. Disbursements for expenditures related to TIF-Funded Improvements may be allocated to and charged against the appropriate line only, with transfers of costs and expenses from one line item to another, without the prior written consent of DCD, being

1101033196 Page: 18 of 73

prohibited; provided, however, that the total amount of expenditures related to TIF-Funded Improvements shall not be less than $25,000,000.

4.06 Cost Overruns. If the aggregate cost of the TIF-Funded Improvements exceeds City Funds available pursuant to Section 4.03 hereof, or if the cost of completing the Project exceeds the Project Budget, the Developer shall be solely responsible for such excess cost, and shall hold the City harmless from any and all costs and expenses of completing the TIF-Funded Improvements in excess of City Funds and of completing the Project.

4.07 Execution of Certificate of Expenditure. Prior to each execution of a Certificate of Expenditure by the City, the Developer shall submit documentation regarding the applicable expenditures to DCD, which shall be satisfactory to DCD in its sole discretion. Delivery by the Developer to DCD of any request for execution by the City of a Certificate of Expenditure hereunder shall, in addition to the items therein expressly set forth, constitute a certification to the City, as of the date of such request for execution of a Certificate of Expenditure, that:

(a) the total amount of the request for Certificate of Expenditure represents the actual cost of the Acquisition or the actual amount paid to the General Contractor and/or subcontractors who have performed work on the Project, and/or their payees;

(b) all amounts shown as previous payments on the current request for Certificate of Expenditure have been paid to the parties entitled to such payment;

(c) the Developer has approved all work and materials for the current request for Certificate of Expenditure, and such work and materials conform to the Plans and Specif cations;

(d) the representations and warranties contained in this Redevelopment Agreement are true and correct and the Developer is in compliance with all covenants contained herein;

(e) the Developer has received no notice and has no knowledge of any liens or claim of lien either filed or threatened against the Property except for the Permitted Liens;

(f) no Event of Default or condition or event which, with the giving of notice or passage of time or both, would constitute an Event of Default exists or has occurred; and

1101033196 Page: 19 of 73

(g) the Project is In Balance. The Project shall be deemed to be in balance ("In Balance") only if the total of the available Project funds equals or exceeds the aggregate of the amount necessary to pay all unpaid Project costs incurred or to be incurred in the completion of the Project. "Available Project Funds" as used herein shall mean: (i) the undisbursed City Funds; (ii) the undisbursed Lender Financing, if any; (iii) the undisbursed Equity and (iv) any other amounts deposited by the Developer pursuant to this Agreement. The Developer hereby agrees that, if the Project is not In Balance, the Developer shall, within 10 days after a written request by the City, deposit with the escrow agent or will make available (in a manner acceptable to the City), cash in an amount that will place the Project In Balance, which deposit shall first be exhausted before any further disbursement ofthe City Funds shall be made.

The City shall have the right, in its discretion, to require the Developer to submit further documentation as the City may require in order to verify that the matters certified to above are true and correct, and any execution of a Certificate of Expenditure by the City shall be subject to the City's review and approval of such documentation and its satisfaction that such certifications are true and correct; provided, however, that nothing in this sentence shall be deemed to prevent the City from relying on such certifications by the Developer. In addition, the Developer shall have satisfied all other preconditions of execution of a Certificate of Expenditure, including but not limited to requirements set forth in the Bond Ordinance, if any, TIF Bond Ordinance, if any, the Bonds, if any, the TIF Bonds, if any, the TIF Ordinances, this Agreement and/or the Escrow Agreement,

4.08 Conditional Grant. The City Funds being provided hereunder are being granted on a conditional basis, subject to the Developer's compliance with the provisions of this Agreement. The City Funds are subject to being reimbursed as provided in SectionIS hereof.

SECTION 5. CONDITIONS PRECEDENT

The following conditions have been complied with to the City's satisfaction on or prior to the Closing Date:

5.01 Proiect Budget. The Developer has submitted to DCD, and DCD has approved, a Project Budget in accordance with the provisions of Section 3.03 hereof.

1101033196 Page: 20 of 73

5.02 Scope Drawings and Plans and Specifications. The Developer has submitted to DCD, and DCD has approved, the Scope Drawings and Plans and Specifications accordance with the provisions of Section 3.02 hereof.

5.03 Other Governmental Approvals. The Developer has secured all other necessary approvals and permits required by any state, federal, or local statute, ordinance or regulation and has submitted evidence thereof to DCD.

5.04 Financing. The Developer has furnished proof reasonably acceptable to the City that the Developer has Equity and Lender Financing in the amounts set forth in Section 4.01 hereof to complete the Project and satisfy its obligations under this Agreement. If a portion of such funds consists of Lender Financing, the Developer has furnished proof as of the Closing Date that the proceeds thereof are available to be drawn upon by the Developer as needed and are sufficient (along with other sources set forth in Section 4.01) to complete the Project, The Developer has delivered to DCD a copy of the construction escrow agreement entered into by the Developer regarding the Lender Financing. Any liens against the Property in existence at the Closing Date have been subordinated to certain encumbrances of the City set forth herein pursuant to a Subordination Agreement, in a form acceptable to the City, executed on or prior to the Closing Date, which is to be recorded, at the expense of the Developer, with the Office of the Recorder of Deeds of Cook County.

5.05 Acguisition and Title. On the Closing Date, the Developer has furnished the City with a copy of the Title Policy for the Property, certified by the Title Company, showing the Developer as the named insured. The Title Policy is dated as of the Closing Date and contains only those title exceptions listed as Permitted Liens on Exhibit G hereto and evidences the recording of this Agreement pursuant to the provisions of Section 8.18 hereof. The Title Policy also contains such endorsements as shall be required by Corporation Counsel, including but not limited to an owner's comprehensive endorsement and satisfactory endorsements regarding zoning (3.1 with parking), contiguity, location, access and survey. The Developer has provided to DCD, on or prior to the Closing Date, documentation related to the purchase of the Property and certified copies of all easements and encumbrances of record with respect to the Property not addressed, to DCD's satisfaction, by the Title Policy and any endorsements thereto.

5.06 Evidence of Clean Title. The Developer, at its own expense, has provided the City with searches under the Developer's name (and the following trade names of the Developer: (GX

1101033196 Page: 21 of 73

Investors, LLC, GX Holdings, LLC, Boise Banks Company, LLC, Baum Real Estate Services, LLC, and Baum Development, LLC) as follows:

Secretary of State UCC search

Secretary of State Federal tax search

Cook County Recorder UCC search Cook County Recorder Fixtures search Cook County Recorder Federal tax search Cook County Recorder State tax search Cook County Recorder Memoranda of judgments search U.S. District Court Pending suits and judgments

Clerk of Circuit Court, Pending suits and Judgments Cook County

showing no liens against the Developer, the Property or any fixtures now or hereafter affixed thereto, except for the Permitted Liens.

5.07 Surveys. The Developer has furnished the City with three (3) copies of the Survey.

5.08 Insurance. The Developer, at its own expense, has insured the Property in accordance with Section 12 hereof, and has delivered certificates required pursuant to Section 12 hereof evidencing the required coverages to DCD.

5.09 Opinion of the Developer's Counsel, On the Closing Date, the Developer has furnished the City with an opinion of counsel, substantially in the form attached hereto as Exhibit J, with such changes as required by or acceptable to Corporation Counsel. If the Developer has engaged special counsel in connection with the Project, and such special counsel is unwilling or unable to give some of the opinions set forth in Exhibit J hereto, such opinions were obtained by the Developer from its general corporate counsel.

5.10 Evidence of Prior Expenditures. The Developer has provided evidence satisfactory to DCD in its sole discretion of the Prior Expenditures in accordance with the provisions of Section 4.05(a) hereof.

_ _ ___1101033196 Page: 22 of 73.... ... _________

5.11 Financial Statements. The Developer has provided Financial Statements to DCD for its most recent fiscal year, and audited or unaudited interim financial statements.

5.12 Documentation. The Developer has provided documentation to DCD, satisfactory in form and substance to DCD, with respect to current employment matters.

5.13 Environmental. The Developer has provided DCD with copies of that certain phase I environmental audit completed with respect to the Property and any phase II environmental audit with respect to the Property required by the City. The Developer has provided the City with a letter from the environmental engineer(s) who completed such audit(s), authorizing the City to rely on such audits.

5.14 Corporate Documents: Economic Disclosure Statement. The Developer has provided a copy of its Articles of Organization containing the original certification ofthe Secretary of State of its state of organization; certificates of good standing from the Secretary of State of its state of organization and all other states in which the Developer is qualified to do business; a secretary's certificate in such form and substance as the Corporation Counsel may require; operating agreement; written consent of the members; and such other documentation as the City has requested. The Developer has provided to the City an Economic Disclosure Statement, in the City's then current form, dated as ofthe Closing Date.

5.15 Litigation. The Developer has provided to Corporation Counsel and DCD, a description of all pending or threatened litigation or administrative proceedings involving the Developer, specifying, in each case, the amount of each claim, an estimate of probable liability, the amount of any reserves taken in connection therewith and whether (and to what extent) such potential liability is covered by insurance,

SECTION 6. AGREEMENTS WITH CONTRACTORS

6.01 Bid Reguirement for General Contractor and Subcontractors. Except as set forth in Section 6.01(b) below, prior to entering into an agreement with a General Contractor or any subcontractor for construction of the Project, the Developer shall solicit, or shall cause the General Contractor to solicit, bids from qualified contractors eligible to do business with the City of Chicago, and shall submit all bids received to DCD for its inspection and written approval. For the TIF-Funded Improvements, the Developer shall select the General Contractor (or shall cause the

1101033196 Page: 23 of 73

General Contractor to select the subcontractor) submitting the lowest responsible bid who can complete the Project in a timely manner. If the Developer selects a General Contractor (or the General Contractor selects any subcontractor) submitting other than the lowest responsible bid for the TIF-Funded Improvements, the difference between the lowest responsible bid and the bid selected may not be paid out of City Funds. The Developer shall submit copies ofthe Construction Contract to DCD in accordance with Section 6,02 below. Photocopies of all subcontracts entered or to be entered into in connection with the TIF-Funded Improvements shall be provided to DCD within five (5) business days of the execution thereof. The Developer shall ensure that the General Contractor shall not (and shall cause the General Contractor to ensure that the subcontractors shall not) begin work on the Project until the Plans and Specifications have been approved by DCD and all requisite permits have been obtained.

6.02 Construction Contract. Prior to the execution thereof, the Developer shall deliver to DCD a copy ofthe proposed Construction Contract with the General Contractor selected to handle the Project in accordance with Section 6.01 above, for DCD's prior written approval, which shall be granted or denied within ten (10) business days after delivery thereof. Within ten (10) business days after execution of such contract by the Developer, the General Contractor and any other parties thereto, the Developer shall deliver to DCD and Corporation Counsel a certified copy of such contract together with any modifications, amendments or supplements thereto.

6.03 Performance and Payment Bonds. Prior to commencement of construction of any portion of the Project, the Developer shall require that the General Contractor be bonded for its performance and payment by sureties having an AA rating or better using American Institute of Architect's Form No. A311 or its equivalent. Prior to the commencement of any portion of the Project which includes work on the public way, the Developer shall require that the General Contractor be bonded for its payment by sureties having an AA rating or better using a bond in the form attached as Exhibit N hereto. The City shall be named as obligee or co-obligee on any such bonds.

6.04 Employment Opportunity. The Developer shall contractually obligate and cause the General Contractor and each subcontractor to agree to the provisions of Section 10 hereof.

6.05 Other Provisions. In addition to the requirements of this Section 6. the Construction Contract and each contract with any subcontractor shall contain provisions required pursuant to Section 3.04 (Change Orders), Section 8.09 (Prevailing Wage), Section 10.01(e) (Employment

__1101033196 Page: 24 of 73

Opportunity), Section 10.02 (City Resident Employment Requirement), Section 10.03 (MBEAA/BE Requirements, as applicable), Section 12 (Insurance) and Section 14.01 (Books and Records) hereof. Photocopies of all contracts or subcontracts entered or to be entered into in connection with the TIF-Funded Improvements shall be provided to DCD within five (5) business days of the execution thereof.

SECTION 7. COMPLETION OF CONSTRUCTION OR REHABILITATION

7.01 Certificate of Completion of Rehabilitation. Upon completion of the rehabilitation of the Project in accordance with the terms of this Agreement and after the final disbursement from the Escrow, and upon the Developer's written request, DCD shall issue to the Developer a Certificate in recordable form certifying that the Developer has fulfilled its obligation to complete the Project in accordance with the terms of this Agreement. DCD shall respond to the Developer's written request for a Certificate within forty-five (45) days by issuing either a Certificate or a written statement detailing the ways in which the Project does not conform to this Agreement or has not been satisfactorily completed, and the measures which must be taken by the Developer in order to obtain the Certificate. The Developer may resubmit a written request for a Certificate upon completion of such measures. However, Developer acknowledges and understands that the City is not obligated to issue a Certificate of Completion until the following conditions have been met:

9 A combined minimum of 65 percent ofthe gross square footage ofthe Project has been contracted for lease and is occupied.

9 Project construction is complete with the exception of tenant build-out not within the Developer's control.

« The City's Monitoring and Compliance unit has determined in writing that the Developer is in complete compliance with all City Requirements (MAA/BE, City Residency, and Prevailing Wage), as provided in the Redevelopment Agreement.

o The Developer has satisfied the City's environmental requirements with respect to items such as LEED Gold pre-certification, as provided in the Redevelopment Agreement.

o The Developer has submitted and the City has approved certification of at least $25 million in TIF-eligible costs.

e Developer is in compliance with all applicable HUD Section 108 Loan provisions with respect to job creation, wages, bidding procedures, and other requirements on the Developer's conduct of business.

1101033196 Page: 25 of 73

7.02 Effect of Issuance of Certificate: Continuing Obligations. The Certificate relates only to the rehabilitation of the Project, and upon its issuance, the City will certify that the terms of the Agreement specifically related to the Developer's obligation to complete such activities have been satisfied. After the issuance of a Certificate, however, all executory terms and conditions of this Agreement and all representations and covenants contained herein will continue to remain in full force and effect throughout the Term ofthe Agreement as to the parties described in the following paragraph, and the issuance of the Certificate shall not be construed as a waiver by the City of any of its rights and remedies pursuant to such executory terms.

Those covenants specifically described at Sections 8.02, 8.06, and 8.19 as covenants that run with the land are the only covenants in this Agreement intended to be binding upon any transferee of the Property (including an assignee as described in the following sentence) throughout the Term of the Agreement notwithstanding the issuance of a Certificate; provided, that upon the issuance of a Certificate, the covenants set forth in Section 8.02 shall be deemed to have been fulfilled. The other executory terms of this Agreement that remain after the issuance of a Certificate shall be binding only upon the Developer or a permitted assignee ofthe Developer who, pursuant to Section 18.15 of this Agreement, has contracted to take an assignment of the Developer's rights under this Agreement and assume the Developer's liabilities hereunder.

7.03 Failure to Complete. If the Developer fails to complete the Project in accordance with the terms of this Agreement, then the City has, but shall not be limited to, any of the following lights and remedies:

(a) the right to terminate this Agreement and cease all disbursement of City Funds not yet disbursed pursuant hereto;

(b) the right (but not the obligation) to complete those TIF-Funded Improvements that are public improvements and to pay for the costs of TIF-Funded Improvements (including interest costs) out of City Funds or other City monies. In the event that the aggregate cost of completing the TIF-Funded Improvements exceeds the amount of City Funds available pursuant to Section 4.01. the Developer shall reimburse the City for all reasonable costs and expenses incurred by the City in completing such TIF-Funded Improvements in excess of the available City Funds; and

1101033196 Page: 26 of 73

(c) the right to seek reimbursement of the City Funds from the Developer, provided that the City is entitled to rely on an opinion of counsel that such reimbursement will not jeopardize the tax-exempt status of the TIF Bonds, if any.

7.04 Notice of Expiration of Term of Agreement. Upon the expiration of the Term of the Agreement, DCD shall provide the Developer, at the Developer's written request, with a written notice in recordable form stating that the Term of the Agreement has expired.

SECTION 8. COVENANTS/REPRESENTATIONSWARRANTIES OF THE DEVELOPER.

8.01 General. The Developer represents, warrants and covenants, as of the date of this Agreement and as of the date of each disbursement of City Funds hereunder, that:

(a) the Developer is an Illinois limited liability corporation duly organized, validly existing, qualified to do business in Illinois, and licensed to do business in any other state where, due to the nature of its activities or properties, such qualification or license is required;

(b) the Developer has the right, power and authority to enter into, execute, deliver and perform this Agreement;

(c) the execution, delivery and performance by the Developer of this Agreement has been duly authorized by all necessary action, and does not and will not violate its Articles of Organization or operating agreement, as amended and supplemented, any applicable provision of law, or constitute a breach of, default under or require any consent under any agreement, instrument or document to which the Developer is now a party or by which the Developer is now or may become bound;

(d) unless otherwise permitted or not prohibited pursuant to or under the terms of this Agreement, the Developer shall acquire and shall maintain good, indefeasible and merchantable fee simple title to the Property (and all improvements thereon) free and clear of all liens (except for the Permitted Liens, Lender Financing as disclosed in the Project Budget and non-governmental charges that the Developer is contesting in good faith pursuant to Section 8.15 hereof);

(e) the Developer is now and for the Term of the Agreement shall remain solvent and able to pay its debts as they mature;

1101033196 Page: 27 of 73

(0 there are no actions or proceedings by or before any court, governmental commission, board, bureau or any other administrative agency pending, threatened or affecting the Developer which would impair its ability to perform under this Agreement;

(g) the Developer has and shall maintain, all government permits, certificates and consents (including, without limitation, appropriate environmental approvals) necessary to conduct its business and to construct, complete and operate the Project;

(h) the Developer is not in default with respect to any indenture, loan agreement, mortgage, deed, note or any other agreement or instrument related to the borrowing of money to which the Developer is a party or by which the Developer is bound;

(i) the Financial Statements are, and when hereafter required to be submitted will be, complete, correct in all material respects and accurately present the assets, liabilities, results of operations and financial condition of the Developer, and there has been no material adverse change in the assets, liabilities, results of operations or financial condition of the Developer since the date of the Developer's most recent Financial Statements;

(j) prior to the issuance of a Certificate, the Developer shall not do any of the following without the prior written consent of DCD: (1) be a party to any merger, liquidation or consolidation; (2) sell, transfer, convey, lease or otherwise dispose of all or substantially all of its assets or any portion of the Property (including but not limited to any fixtures or equipment now or hereafter attached thereto) except in the ordinary course of business; (3) enter into any transaction outside the ordinary course of the Developer's business; (4) assume, guarantee, endorse, or otherwise become liable in connection with the obligations of any other person or entity; or (5) enter into any transaction that would cause a material and detrimental change to the Developer's financial condition;

(k) the Developer has not incurred, and, prior to the issuance of a Certificate, shall not, without the prior written consent of the Commissioner of DCD, allow the existence of any liens against the Property (or improvements thereon) other than the Permitted Liens; or incur any indebtedness, secured or to be secured by the Property (or improvements thereon) or any fixtures now or hereafter attached thereto, except Lender Financing disclosed in the Project Budget; and

1101033196 Page: 28 of 73

(I) has not made or caused to be made, directly or indirectly, any payment, gratuity or offer of employment in connection with the Agreement or any contract paid from the City treasury or pursuant to City ordinance, for services to any City agency ("City Contract") as an inducement for the City to enter into the Agreement or any City Contract with the Developer in violation of Chapter 2-156-120 of the Municipal Code of the City; and

(m) neither the Developer nor any affiliate of the Developer is listed on any ofthe following lists maintained by the Office of Foreign Assets Control ofthe U.S. Department ofthe Treasury, the Bureau of Industry and Security of the U.S. Department of Commerce or their successors, or on any other list of persons or entities with which the City may not do business under any applicable law, rule, regulation, order or judgment: the Specially Designated Nationals List, the Denied Persons List, the Unverified List, the Entity List and the Debarred List. For purposes of this subparagraph (m) only, the term "affiliate," when used to indicate a relationship with a specified person or entity, means a person or entity that, directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with such specified person or entity, and a person or entity shall be deemed to be controlled by another person or entity, if controlled in any manner whatsoever that results in control in fact by that other person or entity (or that other person or entity and any persons or entities with whom that other person or entity is acting jointly or in concert), whether directly or indirectly and whether through share ownership, a trust, a contract or otherwise.

8.02 Covenant to Redevelop. Upon DCD's approval of the Project Budget, the Scope Drawings and Plans and Specifications as provided in Sections 3.02 and 3.03 hereof, and the Developer's receipt of all required building permits and governmental approvals, the Developer shall redevelop the Property in accordance with this Agreement and all Exhibits attached hereto, the TIF Ordinances, the Scope Drawings, Plans and Specifications, Project Budget and all amendments thereto, and all federal, state and local laws, ordinances, rules, regulations, executive orders and codes applicable to the Project, the Property and/or the Developer. The covenants set forth in this Section shall run with the land and be binding upon any transferee, but shall be deemed satisfied upon issuance by the City of a Certificate with respect thereto.

8.03 Redevelopment Plan. The Developer represents that the Project is and shall be in compliance with all of the terms of the Redevelopment Plan.

1101033196 Page: 29 of 73

8.04 Use of City Funds. City Funds disbursed to the Developer shall be used by the Developer solely to pay for (or to reimburse the Developer for its payment for) the TIF-Funded Improvements as provided in this Agreement.

8.05 Other Bonds. The Developer shall, at the request ofthe City, agree to any reasonable amendments to this Agreement that are necessary or desirable in order for the City to Issue (in its sole discretion) any bonds in connection with the Redevelopment Area, the proceeds of which may be used to reimburse the City for expenditures made in connection with, or provide a source of funds for the payment for, the TIF-Funded Improvements (the "Bonds"); provided, however, that any such amendments shall not have a material adverse effect on the Developer or the Project. The Developer shall, at the Developer's expense, cooperate and provide reasonable assistance in connection with the marketing of any such Bonds, including but not limited to providing written descriptions of the Project, making representations, providing information regarding its financial condition and assisting the City in preparing an offering statement with respect thereto.

8.06 Job Creation and Retention. The Developer anticipates that the Project will result in the creation of approximately 450 full-time equivalent, permanent jobs at the Project at the completion thereof to be retained or created at the Facility through the Term of the Agreement. The Developer and the General Contractor shall meet with the Workforce Development (or equivalent) unit of DCD. Developer also shall make best efforts to facilitate meetings between the Workforce Development unit and other contractors, as well as tenants in the Project.

8.07 Employment Opportunity: Progress Reports, The Developer covenants and agrees to abide by, and contractually obligate and use reasonable efforts to cause the General Contractor and each subcontractor to abide by the terms set forth in Section 10 hereof. The Developer shall deliver to the City written progress reports detailing compliance with the requirements of Sections 8.09. 10.02 and 10.03 of this Agreement. Such reports shall be delivered to the City when the Project is 50%, 70% and 100% completed (based on the amount of expenditures incurred in relation to the Project Budget). If any such reports indicate a shortfall in compliance, the Developer shall also deliver a plan to DCD which shall outline, to DCD's satisfaction, the manner in which the Developer shall correct any shortfall.

8.08 Employment Profile. The Developer shall submit, and contractually obligate and cause the General Contractor or any subcontractor to submit, to DCD, from time to time, statements of its employment profile upon DCD's request.

JJOJ 033196 Page: _30of 73

8.09 Wage Requirement. The Developer covenants and agrees to pay, and to contractually obligate and cause the General Contractor and each subcontractor to pay, the prevailing wage rate as ascertained by the Illinois Department of Labor (the "Department"), or if federal funding is used to pay any Project costs the wages required by the Davis-Bacon Act. 40 U.S.C. Section 276a §t seq to all Project employees. All such contracts shall list the specified rates to be paid to all laborers, workers and mechanics for each craft or type of worker or mechanic employed pursuant to such contract. If the Department or United States government revises such wage rates, the revised rates shall apply to all such contracts. Upon the City's request, the Developer shall provide the City with copies of all such contracts entered into by the Developer or the General Contractor to evidence compliance with this Section 8.09.

8.10 Anns-Length Transactions. Unless DCD has given its prior written consent with respect thereto, no Affiliate of the Developer may receive any portion of City Funds, directly or indirectly, in payment for work done, services provided or materials supplied in connection with any TIF-Funded Improvement. The Developer shall provide information with respect to any entity to receive City Funds directly or indirectly (whether through payment to the Affiliate by the Developer and reimbursement to the Developer for such costs using City Funds, or otherwise), upon DCD's request, prior to any such disbursement.

8.11 Conflict of Interest. Pursuant to Section 5/11-74.4-4(n) of the Act, the Developer represents, warrants and covenants that, to the best of its knowledge, no member, official, or employee of the City, or of any commission or committee exercising authority over the Project, the Redevelopment Area or the Redevelopment Plan, or any consultant hired by the City or the Developer with respect thereto, owns or controls, has owned or controlled or will own or control any interest, and no such person shall represent any person, as agent or otherwise, who owns or controls, has owned or controlled, or will own or control any interest, direct or indirect, in the Developer's business, the Property or any other property in the Redevelopment Area.

8.12 Disclosure of Interest. The Developer's counsel has no direct or indirect financial ownership interest in the Developer, the Property or any other aspect of the Project.

8.13 Financial Statements. The Developer shall obtain and provide to DCD Financial Statements for the Developer's fiscal year ended 2009 and each fiscal year thereafter for the Term of the Agreement. In addition, the Developer shall submit unaudited financial statements as soon as

1101033196 Page: 31 of 73

reasonably practical following the close of each fiscal year and for such other periods as DCD may request.

8.14 Insurance. The Developer, at its own expense, shall comply with all provisions of Section 12 hereof.

8.15 Non-Governmental Charges, (a) Payment of Non-Governmental Charges. Except for the Permitted Liens, the Developer agrees to pay or cause to be paid when due any Non-Governmental Charge assessed or imposed upon the Project, the Property or any fixtures that are or may become attached thereto, which creates, may create, or appears to create a lien upon all or any portion of the Property or Project; provided however, that if such Non-Governmental Charge may be paid in installments, the Developer may pay the same together with any accrued interest thereon in Installments as they become due and before any fine, penalty, interest, or cost may be added thereto for nonpayment. The Developer shall furnish to DCD, within thirty (30) days of DCD's request, official receipts from the appropriate entity, or other proof satisfactory to DCD, evidencing payment of the Non-Governmental Charge in question.

(b) Right to Contest, The Developer has the right, before any delinquency occurs:

(i) to contest or object in good faith to the amount or validity of any Non-Governmental Charge by appropriate legal proceedings properly and diligently instituted and prosecuted, in such manner as shall stay the collection ofthe contested Non-Governmental Charge, prevent the imposition of a lien or remove such lien, or prevent the sale or forfeiture of the Property (so long as no such contest or objection shall be deemed or construed to relieve, modify or extend the Developer's covenants to pay any such Non-Governmental Charge at the time and in the manner provided in this Section 8.15V, or

(ii) at DCD's sole option, to furnish a good and sufficient bond or other security satisfactory to DCD in such form and amounts as DCD shall require, or a good and sufficient undertaking as may be required or permitted by law to accomplish a stay of any such sale or forfeiture of the Property or any portion thereof or any fixtures that are or may be attached thereto, during the pendency of such contest, adequate to pay fully any such contested Non-Governmental Charge and all interest and penalties upon the adverse determination of such contest.

1101033196 Page: 32 of 73

8.16 Developer's Liabilities. The Developer shall not enter into any transaction that would materially and adversely affect its ability to perform its obligations hereunder or to repay any material liabilities or perform any material obligations of the Developer to any other person or entity. The Developer shall immediately notify DCD of any and all events or actions which may materially affect the Developer's ability to carry on its business operations or perform its obligations under this Agreement or any other documents and agreements.

8.17 Compliance with Laws. To the best of the Developer's knowledge, after diligent inquiry, the Property and the Project are and shall be in compliance with all applicable federal, state and local laws, statutes, ordinances, rules, regulations, executive orders and codes pertaining to or affecting the Project and the Property. Upon the City's request, the Developer shall provide evidence satisfactory to the City of such compliance.

8.18 Recording and Filing. The Developer shall cause this Agreement, certain exhibits (as specified by Corporation Counsel), all amendments and supplements hereto to be recorded and filed against the Property on the date hereof in the conveyance and real property records of the county in which the Project is located. This Agreement shall be recorded prior to any mortgage made in connection with Lender Financing. However, if this Agreement is not recorded first, all existing mortgages will have to be subordinated to this Agreement. The Developer shall pay all fees and charges incurred in connection with any such recording. Upon recording, the Developer shall immediately transmit to the City an executed original of this Agreement showing the date and recording number of record.

8.19 Real Estate Provisions.

(a) Governmental Charges.

(i) Payment of Governmental Charges. The Developer agrees to pay or cause to be paid when due all Governmental Charges (as defined below) which are assessed or imposed upon the Developer, the Property or the Project, or become due and payable, and which create, or may create a lien upon the Developer or all or any portion of the Property or the Project. "Governmental Charge" shall mean all federal, State, county, the City, or other governmental (or any instrumentality, division, agency, body, or department thereof) taxes, levies, assessments, charges, liens, claims or encumbrances relating to the Developer, the Property or the Project including but not limited to real estate taxes.

1101033196 Page: 33 of 73

(ii) Right to Contest. The Developer has the right before any delinquency occurs to contest or object in good faith to the amount or validity of any Governmental Charge by appropriate legal proceedings properly and diligently instituted and prosecuted in such manner as shall stay the collection of the contested Governmental Charge and prevent the imposition of a lien or the sale or forfeiture of the Property. The Developer's right to challenge real estate taxes applicable to the Property is limited as provided for in Section 8,19(c) below; provided, that such real estate taxes must be paid in full when due and may be disputed only after such payment is made. No such contest or objection shall be deemed or construed in any way as relieving, modifying or extending the Developer's covenants to pay any such Governmental Charge at the time and in the manner provided in this Agreement unless the Developer has given prior written notice to DCD of the Developer's intent to contest or object to a Governmental Charge and, unless, at DCD's sole option,

(i) the Developer shall demonstrate to DCD's satisfaction that legal proceedings instituted by the Developer contesting or objecting to a Governmental Charge shall conclusively operate to prevent or remove a lien against, or the sale or forfeiture of, all or any part of the Property to satisfy such Governmental Charge prior to final determination of such proceedings; and/or

(ii) the Developer shall furnish a good and sufficient bond or other security satisfactory to DCD in such form and amounts as DCD shall require, or a good and sufficient undertaking as may be required or permitted by law to accomplish a stay of any such sale or forfeiture of the Property during the pendency of such contest, adequate to pay fully any such contested Governmental Charge and all interest and penalties upon the adverse determination of such contest.

(b) Developer's Failure To Pay Or Discharge Lien. If the Developer fails to pay any Governmental Charge or to obtain discharge of the same, the Developer shall advise DCD thereof in writing, at which time DCD may, but shall not be obligated to, and without waiving or releasing any obligation or liability of the Developer under this Agreement, in DCD's sole discretion, make such payment, or any part thereof, or obtain such discharge and take any other action with respect thereto which DCD deems advisable. All sums so paid by DCD, if any, and any expenses, if any, including reasonable attorneys' fees, court costs, expenses and other charges relating thereto, shall be promptly disbursed to DCD by the Developer. Notwithstanding anything contained herein to the

1101033196 Page: 34 of 73

contrary, this paragraph shall not be construed to obligate the City to pay any such Governmental Charge. Additionally, if the Developer fails to pay any Governmental Charge, the City, in its sole discretion, may require the Developer to submit to the City audited Financial Statements at the Developer's own expense.

(i) Acknowledgment of Real Estate Taxes. The Developer agrees that (A) for the purpose of this Agreement, the total projected minimum assessed value ofthe Property that is necessary to support the debt service indicated ("Minimum Assessed Value") is shown on Exhibit K attached hereto and incorporated herein by reference for the years noted on Exhibit K: and (B) the real estate taxes anticipated to be generated and derived from the respective portions of the Property and the Project for the years shown are fairly and accurately indicated in Exhibit K.

(ii) Real Estate Tax Exemption. With respect to the Property or the Project, neither the Developer nor any agent, representative, lessee, tenant, assignee, transferee or successor in interest to the Developer shall, during the Term of this Agreement, seek, or authorize any exemption (as such term is used and defined in the Illinois Constitution, Article IX, Section 6 (1970)) for any year that the Redevelopment Plan is in effect.

(iii) No Reduction in Real Estate Taxes. Neither the Developer nor any agent, representative, lessee, tenant, assignee, transferee or successor in interest to the Developer shall, during the Term of this Agreement, directly or indirectly, initiate, seek or apply for proceedings in order to lower the assessed value of all or any portion of the Property or the Project below the amount of the Minimum Assessed Value as shown in Exhibit K for the applicable year.

(iv) No Objections. Neither the Developer nor any agent, representative, lessee, tenant, assignee, transferee or successor in interest to the Developer, shall object to or in any way seek to interfere with, on procedural or any other grounds, the filing of any Underassessment Complaint or subsequent proceedings related thereto with the Cook County Assessor or with the Cook County Board of Appeals, by either the City or any taxpayer. The term "Underassessment Complaint" as used in this Agreement shall mean

1101033196 Page: 35 of 73

any complaint seeking to increase the assessed value ofthe Property up to (but not above) the Minimum Assessed Value as shown in Exhibit K,

(v) Covenants Running with the Land. The parties agree that the restrictions contained in this Section 8.19(c) are covenants running with the land and this Agreement shall be recorded by the Developer as a memorandum thereof, at the Developer's expense, with the Cook County Recorder of Deeds on the Closing Date. These restrictions shall be binding upon the Developer and its agents, representatives, lessees, successors, assigns and transferees from and after the date hereof, provided however, that the covenants shall be released when the Redevelopment Area is no longer in effect. The Developer agrees that any sale, lease, conveyance, or transfer of title to all or any portion of the Property or Redevelopment Area from and after the date hereof shall be made explicitly subject to such covenants and restrictions, Notwithstanding anything contained in this Section 8.19(c) to the contrary, the City, in its sole discretion and by its sole action, without the joinder or concurrence of the Developer, its successors or assigns, may waive and terminate the Developer's covenants and agreements set forth in this Section 8.19(c).

8.20 Dark Day/Performance Covenants.

The Developer covenants to:

» maintain the Project as a multi-tenant business incubator during the term of the HUD Section 108 Loan;

» maintain at least 70% occupancy of the Project;

9 comply with other standard provisions of this Agreement, including but not limited to permitted uses;

9 comply with other provisions ofthe HUD Section 108 Loan documents, included but not limited to job creation, monitoring provisions, and ongoing required disclosures;

o pay alt debt service on the HUD Section108 Loan when due; and

1101033196 Page: 36 of 73

8.21 Intentionally Deleted.

8.22 Job Readiness Program. Prior to the Closing Date, Developer must meet with the Workforce Development unit of DCD to discuss the Project. In addition, Developer must send a letter (copying DCD) to any tenants to familiarize them with the programs established by the City and available through DCD for the purpose of helping prepare individuals to work for businesses located within TIF districts established on the Site. Developer also shall make best efforts to arrange a meeting between Project tenants and the Workforce Development unit of DCD.

8.23 Survival of Covenants. All warranties, representations, covenants and agreements of the Developer contained in this Section 8 and elsewhere in this Agreement shall be true, accurate and complete at the time of the Developer's execution of this Agreement, and shall survive the execution, delivery and acceptance hereof by the parties hereto and (except as provided in Section 7 hereof upon the issuance of a Certificate) shall be in effect throughout the Term ofthe Agreement.

8.24 Annual Compliance Report. Beginning with the issuance of the Certificate and continuing throughout the Term ofthe Agreement, the Developer shall submit to DCD the Annual Compliance Report within 30 days after the end of the calendar year to which the Annual Compliance Report relates.

SECTION 9. COVENANTS/REPRESENTATIONSA/VARRANTIES OF CITY

9.01 General Covenants. The City represents that it has the authority as a home rule unit of local government to execute and deliver this Agreement and to perform its obligations hereunder.

9.02 Survival of Covenants. All warranties, representations, and covenants of the City contained in this Section 9 or elsewhere in this Agreement shall be true, accurate, and complete at the time of the City's execution of this Agreement, and shall survive the execution, delivery and acceptance hereof by the parties hereto and be in effect throughout the Term of the Agreement.

1101033196 Page: 37 of 73

SECTION 10. DEVELOPER'S EMPLOYMENT OBLIGATIONS

10.01 Employment Opportunity. The Developer, on behalf of itself and its successors and assigns, hereby agrees, and shall contractually obligate its or their various contractors, subcontractors or any Affiliate of the Developer operating on the Property (collectively, with the Developer, the "Employers" and individually an "Employer") to agree, that for the Term of this Agreement with respect to Developer and during the period of any other party's provision of services in connection with the construction ofthe Project or occupation ofthe Property:

(a) No Employer shall discriminate against any employee or applicant for employment based upon race, religion, color, sex, national origin or ancestry, age, handicap or disability, sexual orientation, military discharge status, marital status, parental status or source of income as defined in the City of Chicago Human Rights Ordinance, Chapter 2-160, Section 2-160-010 et seq Municipal Code, except as otherwise provided by said ordinance and as amended from time to time (the "Human Rights Ordinance"). Each Employer shall take affirmative action to ensure that applicants are hired and employed without discrimination based upon race, religion, color, sex, national origin or ancestry, age, handicap or disability, sexual orientation, military discharge status, marital status, parental status or source of income and are treated in a non-discriminatory manner with regard to all job-related matters, including without limitation: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. Each Employer agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided by the City setting forth the provisions of this nondiscrimination clause. In addition, the Employers, in all solicitations or advertisements for employees, shall state that all qualified applicants shall receive consideration for employment without discrimination based upon race, religion, color, sex, national origin or ancestry, age, handicap or disability, sexual orientation, military discharge status, marital status, parental status or source of income.

(b) To the greatest extent feasible, each Employer is required to present opportunities for training and employment of low- and moderate-income residents of the City and preferably of the Redevelopment Area; and to provide that contracts for work in connection with the construction of the Project be awarded to business concerns that are located in, or owned in substantial part by persons residing in, the City and preferably in the Redevelopment Area.

1101033196 Page: 38 of 73

(c) Each Employer shall comply with all federal, state and local equal employment and affirmative action statutes, rules and regulations, including but not limited to the City's Human Rights Ordinance and the Illinois Human Rights Act, 775 ILCS 5/1-101 et seg, (1993), and any subsequent amendments and regulations promulgated thereto.

(d) Each Employer, in order to demonstrate compliance with the terms of this Section, shall cooperate with and promptly and accurately respond to inquiries by the City, which has the responsibility to observe and report compliance with equal employment opportunity regulations of federal, state and municipal agencies.

(e) Each Employer shall include the foregoing provisions of subparagraphs (a) through (d) in every contract entered into in connection with the Project, and shall require inclusion of these provisions in every subcontract entered Into by any subcontractors, and every agreement with any Affiliate operating on the Property, so that each such provision shall be binding upon each contractor, subcontractor or Affiliate, as the case may be.

(f) Failure to comply with the employment obligations described in this Section 10.01 shall be a basis for the City to pursue remedies under the provisions of Section 15.02 hereof.

10.02 City Resident Construction Worker Employment Requirement. The Developer agrees for itself and its successors and assigns, and shall contractually obligate its General Contractor and shall cause the General Contractor to contractually obligate its subcontractors, as applicable, to agree, that during the construction of the Project, except for expenditures occurring prior to the Closing Date, 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 Developer, its General Contractor and each subcontractor shall be required to make good faith efforts to utilize qualified residents ofthe City in both unskilled and skilled labor positions.

The Developer 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.

1101033196_Page: 39 of 73

"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 Developer, the General Contractor and each subcontractor shall provide for the maintenance of adequate employee residency records to show that actual Chicago residents are employed on the Project. Each Employer 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 DCD 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 Employer hired the employee should be written in after the employee's name.

The Developer, the General Contractor and each subcontractor shall provide full access to their employment records to the Chief Procurement Officer, the Commissioner of DCD, the Superintendent of the Chicago Police Department, the Inspector General or any duly authorized representative of any of them. The Developer, the General Contractor and each subcontractor shall maintain all relevant personnel data and records for a period of at least three (3) years after final acceptance of the work constituting the Project.

At the direction of DCD, affidavits and other supporting documentation will be required of the Developer, the General Contractor and each subcontractor 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 Developer, the General Contractor and each subcontractor 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 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 Developer has 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 above, the City will thereby be damaged in the failure to provide the benefit of demonstrable

1101033196 Page: 40 of 73

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) ofthe aggregate hard construction costs set forth in the Project budget (the product of .0005 x such aggregate hard construction costs) (as the same shall be evidenced by approved contract value for the actual contracts) shall be surrendered by the Developer 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 Developer, the General Contractor and/or the subcontractors to prosecution. Any retainage to cover contract performance that may become due to the Developer pursuant to Section 2-92-250 ofthe Municipal Code of Chicago may be withheld by the City pending the Chief Procurement Officers determination as to whether the Developer 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 Agreement or related documents.

The Developer shall cause or require the provisions of this Section 10.02 to be included in all construction contracts and subcontracts related to the Project.

10.03. MBEAA/BE Commitment. The Developer agrees for itself and its successors and assigns, and, if necessary to meet the requirements set forth herein, shall contractually obligate the General Contractor to agree that during the Project:

(a) Consistent with the findings which support, as applicable, (i) the Minority-Owned and Women-Owned Business Enterprise Procurement Program, Section 2-92-420 et seq Municipal Code of Chicago (the "Procurement Program"), and (ii) the Minority- and Women-Owned Business Enterprise Construction Program, Section 2-92-650 et seg., Municipal Code of Chicago (the "Construction Program," and collectively with the Procurement Program, the "MBEAA/BE Program"), and in reliance upon the provisions of the MBEA/VBE Program to the extent contained in, and as qualified by, the provisions of this Section 10.03, during the course of the Project, at least the

1101033196 Page: 41 of 73

following percentages of the MBEAA/BE Budget (as set forth in Exhibit H-2 hereto) shall be expended for contract participation by MBEs and by WBEs:

(1) At least 24 percent by MBEs.

(2) At least four percent by WBEs.

(b) For purposes of this Section 10.03 only, the Developer (and any party to whom a contract is let by the Developer in connection with the Project) shall be deemed a "contractor" and this Agreement (and any contract let by the Developer in connection with the Project) shall be deemed a "contract" or a "construction contract" as such terms are defined in Sections 2-92-420 and 2-92-670, Municipal Code of Chicago, as applicable.

(c) Consistent with Sections 2-92-440 and 2-92-720, Municipal Code of Chicago, the Developer's MBE/WBE commitment may be achieved in part by the Developer's status as an MBE or WBE (but only to the extent of any actual work performed on the Project by the Developer) 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 Developer 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 ofthe Project to one or more MBEs or WBEs, or by the purchase of materials or services 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 Developer's MBEAA/BE commitment as described in this Section 10.03. In accordance with Section 2-92-730, Municipal Code of Chicago, the Developer shall not substitute any MBE or WBE General Contractor or subcontractor without the prior written approval of DCD.

(d) The Developer shall deliver monthly reports to the City's monitoring staff during the Project describing its efforts to achieve compliance with this MBEAA/BE commitment. Such reports shall include, inter alia, the name and business address of each MBE and WBE solicited by the Developer 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 the City's monitoring staff in determining the Developer's compliance with this MBEAA/BE commitment. The Developer shall

1101033196 Page: 42 of 73

maintain records of all relevant data with respect to the utilization of MBEs and WBEs in connection with the Project for at least five years after completion ofthe Project, and the City's monitoring staff shall have access to all such records maintained by the Developer, on five Business Days' notice, to allow the City to review the Developer's compliance with its commitment to MBE/WBE participation and the status of any MBE or WBE performing any portion ofthe Project.

(e) Upon the disqualification of any MBE or WBE General Contractor or subcontractor, if such status was misrepresented by the disqualified party, the Developer 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 (e), the disqualification procedures are further described in Sections 2-92-540 and 2-92-730, Municipal Code of Chicago, as applicable.

(0 Any reduction or waiver ofthe Developer's MBEA/VBE commitment as described in this Section 10.03 shall be undertaken in accordance with Sections 2-92-450 and 2-92-730, Municipal Code of Chicago, as applicable.

(g) Prior to the commencement of the Project, the Developer shall be required to meet with the City's monitoring staff with regard to the Developer's compliance with its obligations under this Section 10.03. The General Contractor and all major subcontractors shall be required to attend this pre-construction meeting. During said meeting, the Developer shall demonstrate to the City's monitoring staff its plan to achieve its obligations under this Section 10.03, the sufficiency of which shall be approved by the City's monitoring staff. During the Project, the Developer shall submit the documentation required by this Section 10.03 to the City's monitoring staff, including the following: (i) subcontractor's activity report; (ii) contractor's certification concerning labor standards and prevailing wage requirements; (iii) contractor letter of understanding; (iv) monthly utilization report; (v) authorization for payroll agent; (vi) certified payroll; (vii) evidence that MBEAA/BE contractor associations have been informed of the Project via written notice and hearings; and (viii) evidence of compliance with job creation/job retention requirements. Failure to submit such documentation on a timely basis, or a determination by the City's monitoring staff, upon analysis of the documentation, that the Developer is not complying with its obligations under this Section 10.03, shall, upon the delivery of written notice to the Developer, be deemed an Event of Default. Upon the occurrence of any such Event of Default, in addition to any other remedies provided in this Agreement, the City may: (1) issue a written demand to the Developer to halt the Project, (2) withhold any further

1101033196 Page: 43 of 73

payment of any City Funds to the Developer or the General Contractor, or (3) seek any other remedies against the Developer available at law or in equity.

SECTION 11. ENVIRONMENTAL MATTERS

The Developer hereby represents and warrants to the City that the Developer has conducted environmental studies sufficient to conclude that the Project may be constructed, completed and operated in accordance with all Environmental Laws and this Agreement and all Exhibits attached hereto, the Scope Drawings, Plans and Specifications and all amendments thereto, the Bond Ordinance and the Redevelopment Plan. Developer must provide to the City all studies and any audits performed on the Property and a reliance letter from environmental consultant.

Without limiting any other provisions hereof, the Developer agrees to indemnify, defend and hold the City harmless from and against any and all losses, liabilities, damages, Injuries, costs, expenses or claims of any kind whatsoever including, without limitation, any losses, liabilities, damages, injuries, costs, expenses or claims asserted or arising under any Environmental Laws incurred, suffered by or asserted against the City as a direct or indirect result of any of the following, regardless of whether or not caused by, or within the control of the Developer: (i) the presence of any Hazardous Material on or under, or the escape, seepage, leakage, spillage, emission, discharge or release of any Hazardous Material from (A) all or any portion of the Property or (B) any other real property in which the Developer, or any person directly or indirectly controlling, controlled by or under common control with the Developer, holds any estate or interest whatsoever (including, without limitation, any property owned by a land trust in which the beneficial interest is owned, in whole or in part, by the Developer), or (ii) any liens against the Property permitted or imposed by any Environmental Laws, or any actual or asserted liability or obligation of the City or the Developer or any of its Affiliates under any Environmental Laws relating to the Property.

The Project will attain LEED Gold certification, including such green/sustainable features as a 41,000 gallon rain cistern, a green escalator that uses 30% less energy than a standard model, as well as a green rooftop that features a solar thermal system.

1101033196 Page: 44 of 73

SECTION 12. INSURANCE

The Developer must provide and maintain, at Developer's own expense, or cause to be provided and maintained during the term of this Agreement, the insurance coverage and requirements specified below, insuring all operations related to the Agreement.

(a) Prior to execution and delivery of this Agreement.

(i) Workers Compensation and Employers Liability

Workers Compensation Insurance, as prescribed by applicable law covering all employees who are to provide work under this Agreement and Employers Liability coverage with limits of not less than $100.000 each accident, illness or disease.

(ii) 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 independent contractors, separation of insureds, defense, and contractual liability (with no 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 work.

(iii) All Risk Property

All Risk Property Insurance at replacement value of the property to protect against loss of, damage to, or destruction of the building/facility. The City is to be named as an additional insured and loss payee/mortgagee if applicable.

(b) Construction. Prior to the construction of any portion of the Project, Developer will cause its architects, contractors, subcontractors, project managers and other parties constructing the Project to procure and maintain the following kinds and amounts of insurance:

(i) Workers Compensation and Employers Liability

1101033196 Page: 45 of 73

(ii) Commercial General Liability (Primary and Umbrella)

Commercial General Liability Insurance or equivalent with limits of not less than $2.000.000 per occurrence for bodily injury, personal injury, and property damage liability. Coverages must include the following: All premises and operations, products/completed operations (for a minimum of two (2) years following project completion), explosion, collapse, underground, separation of insureds, defense, and contractual liability (with no 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 work.

(iii) Automobile Liability (Primary and Umbrella)

When any motor vehicles (owned, non-owned and hired) are used in connection with work to be performed, the Automobile Liability Insurance with limits of not less than $2,000,000 per occurrence for bodily injury and property damage. The City of Chicago is to be named as an additional insured on a primary, non-contributory basis.

(iv) Railroad Protective Liability

When any work is to be done adjacent to or on railroad or transit property, Developer must provide cause to be provided with respect to the operations that Contractors perform, Railroad Protective Liability Insurance in the name of railroad or transit entity. The policy must have limits of not less than $2,000,000 per occurrence and $6,000.000 in the aggregate for losses arising out of injuries to or death of all persons, and for damage to or destruction of property, including the loss of use thereof.

(v) All Risk /Builders Risk

When Developer undertakes any construction, including improvements, betterments, and/or repairs, the Developer must provide or cause to be provided All Risk Builders Risk Insurance

1101033196 Page: 46 of 73

at replacement cost for materials, supplies, equipment, machinery and fixtures that are or will be part ofthe project. The City of Chicago is to be named as an additional insured and loss payee/mortgagee if applicable.

(vi) 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. Coverage must include contractual liability. When policies are renewed or replaced, the policy retroactive date must coincide with, or precede, start of work on the Contract. A claims-made policy which is not renewed or replaced must have an extended reporting period of two (2) years.

(vii) Valuable Papers

When any plans, designs, drawings, specifications and documents are produced or used under this Agreement, Valuable Papers Insurance must be maintained in an amount to insure against any loss whatsoever, and must have limits sufficient to pay for the re-creation and reconstruction of such records.

(viii) Contractors Pollution Liability

When any remediation work is performed which may cause a pollution exposure, the Developer must cause remediation contractor to provide Contractor Pollution Liability covering bodily injury, property damage and other losses caused by pollution conditions that arise from the contract scope of work with limits of not less than $1.000.000 per occurrence. Coverage must include completed operations, contractual liability, defense, excavation, environmental cleanup, remediation and disposal. When policies are renewed or replaced, the policy retroactive date must coincide with or precede, start of work on the Agreement. A claims-made policy which is not renewed or replaced must have an extended reporting period of two (2) years. The City of Chicago is to be named as an additional insured.

1101033196 Page: 47 of 73

(i) All Risk Property Insurance at replacement value of the property to protect against loss of, damage to, or destruction of the building/facility. The City is to be named as an additional insured and loss payee/mortgagee if applicable.

(d) Other Requirements:

The Developer must furnish the City of Chicago, Department of Community Development, City Hall, Room 1000,121 North LaSalle Street 60602, original Certificates of Insurance, or such similar evidence, 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 Developer must submit evidence of insurance on the City of Chicago Insurance Certificate Form (copy attached) or equivalent prior to closing. 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 Developer is not a waiver by the City of any requirements for the Developer to obtain and maintain the specified coverages. The Developer shall advise all insurers of the Agreement provisions regarding insurance. Non-conforming insurance does not relieve Developer 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 and/or terminate agreement until proper evidence of insurance is provided.

The insurance must provide for 60 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 Developer and Contractors.

The Developer hereby waives and agrees to require their insurers to waive their rights of subrogation against the City of Chicago, its employees, elected officials, agents, or representatives.

The coverages and limits furnished by Developer in no way limit the Developer's liabilities and responsibilities specified within the Agreement or by law.

1101033196 Page: 48 of 73

Any insurance or self insurance programs maintained by the City of Chicago do not contribute with insurance provided by the Developer under the Agreement.

The required insurance to be carried 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.

If Developer is a joint venture or limited liability company, the insurance policies must name the joint venture or limited liability company as a named insured.

The Developer must require Contractor and subcontractors to provide the insurance required herein, or Developer may provide the coverages for Contractor and subcontractors. All Contractors and subcontractors are subject to the same insurance requirements of Developer unless otherwise specified in this Agreement.

If Developer, any Contractor or subcontractor desires 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 13. INDEMNIFICATION

13.01 General Indemnity. Developer agrees to indemnify, pay, defend and hold the City, and its elected and appointed officials, employees, agents and affiliates {individually an "Indemnitee," and collectively the "Indemnitees") harmless from and against, any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, expenses and disbursements of any kind or nature whatsoever (and including without limitation, the reasonable fees and disbursements of counsel for such Indemnitees in connection with any investigative, administrative or judicial proceeding commenced or threatened, whether or not such Indemnities shall be designated a party thereto), that may be imposed on, suffered, incurred by or asserted against the Indemnitees in any manner relating or arising out of:

1101033196 Page: 49 of 73.

(i) the Developer's failure to comply with any of the terms, covenants and conditions contained within this Agreement; or

(ii) the Developer's or any contractor's failure to pay General Contractors, subcontractors or materialmen in connection with the TIF-Funded Improvements or any other Project improvement; or

(iii) the existence of any material misrepresentation or omission in this Agreement, any offering memorandum or information statement or the Redevelopment Plan or any other document related to this Agreement that is the result of information supplied or omitted by the Developer or any Affiliate Developer or any agents, employees, contractors or persons acting under the control or at the request of the Developer or any Affiliate of Developer; or

(iv) the Developer's failure to cure any misrepresentation in this Agreement or any other agreement relating hereto;

provided, however, that Developer shall have no obligation to an Indemnitee arising from the wanton or willful misconduct of that Indemnitee. To the extent that the preceding sentence may be unenforceable because it is violative of any law or public policy, Developer shall contribute the maximum portion that it is permitted to pay and satisfy under the applicable law, to the payment and satisfaction of all indemnified liabilities incurred by the Indemnitees or any of them. The provisions of the undertakings and indemnification set out in this Section 13.01 shall survive the termination of this Agreement.

SECTION 14. MAINTAINING RECORDS/RIGHT TO INSPECT

14.01 Books and Records. The Developer shall keep and maintain separate, complete, accurate and detailed books and records necessary to reflect and fully disclose the total actual cost of the Project and the disposition of all funds from whatever source allocated thereto, and to monitor the Project. Ail such books, records and other documents, including but not limited to the Developer's loan statements, if any, General Contractors' and contractors' sworn statements, general contracts, subcontracts, purchase orders, waivers of lien, paid receipts and invoices, shall be available at the Developer's offices for inspection, copying, audit and examination by an authorized representative ofthe City, at the Developer's expense. The Developer shall incorporate

1101033196 Page: 50 of 73

this right to inspect, copy, audit and examine all books and records into all contracts entered into by the Developer with respect to the Project.

14.02 Inspection Rights. Upon three (3) business days' notice, any authorized representative of the City has access to all portions of the Project and the Property during normal business hours for the Term ofthe Agreement.

SECTION 15. DEFAULT AND REMEDIES

15.01 Events of Default. The occurrence of any one or more ofthe following events, subject to the provisions of Section 15.03. shall constitute an 'Event of Default" by the Developer hereunder:

(a) the failure of the Developer to perform, keep or observe any of the covenants, conditions, promises, agreements or obligations of the Developer under this Agreement or any related agreement;

(b) the failure of the Developer to perform, keep or observe any of the covenants, conditions, promises, agreements or obligations of the Developer under any other agreement with any person or entity if such failure may have a material adverse effect on the Developer's business, property, assets, operations or condition, financial or otherwise;

(c) the making or furnishing by the Developer to the City of any representation, warranty, certificate, schedule, report or other communication within or in connection with this Agreement or any related agreement which is untrue or misleading in any material respect;

(d) except as otherwise permitted hereunder, the creation (whether voluntary or involuntary) of, or any attempt to create, any lien or other encumbrance upon the Property, including any fixtures now or hereafter attached thereto, other than the Permitted Liens, or the making or any attempt to make any levy, seizure or attachment thereof;

(e) the commencement of any proceedings in bankruptcy by or against the Developer or for the liquidation or reorganization of the Developer, or alleging that the Developer is insolvent or unable to pay its debts as they mature, or for the readjustment or arrangement of the Developer's debts, whether under the United States Bankruptcy Code or under any other state or federal law, now or hereafter existing for the relief of debtors, or the commencement of any analogous statutory

1101033196 Page: 51 of 73

or non-statutory proceedings involving the Developer; provided, however, that if such commencement of proceedings is involuntary, such action shall not constitute an Event of Default unless such proceedings are not dismissed within sixty (60) days after the commencement of such proceedings;

(f) the appointment of a receiver or trustee for the Developer, for any substantial part ofthe Developer's assets or the institution of any proceedings for the dissolution, or the full or partial liquidation, or the merger or consolidation, of the Developer; provided, however, that if such appointment or commencement of proceedings is involuntary, such action shall not constitute an Event of Default unless such appointment is not revoked or such proceedings are not dismissed within sixty (60) days after the commencement thereof;

(g) the entry of any judgment or order against the Developer which remains unsatisfied or undischarged and in effect for sixty (60) days after such entry without a stay of enforcement or execution;

(h) the occurrence of an event of default under the Lender Financing or HUD Section 108 Loan, which default is not cured within any applicable cure period;

(i) the dissolution of the Developer or the death of any natural person who owns a material interest in the Developer; or

(j) the institution in any court of a criminal proceeding (other than a misdemeanor) against the Developer or any natural person who owns a material interest in the Developer, which is not dismissed within thirty (30) days, or the indictment of the Developer or any natural person who owns a material interest in the Developer, for any crime (other than a misdemeanor); or

(k) prior to the issuance of the Certificate, the sale or transfer of a majority.of the ownership interests of the Developer without the prior written consent of the City; or

(I) using the Property, Facility or Project (including the erection signs) in any way not allowed by the Redevelopment Agreement, Business Planned District No. 1094, the City Zoning Ordinance and the Addison South Redevelopment Plan.

1101033196 Page: 52 of 73

For purposes of Sections 15.01(i) and 15.01 ()) hereof, a person with a material interest in the Developer shall be one owning in excess of ten (10%) of the Developer's membership interests.

15.02 Remedies. Upon the occurrence of an Event of Default, the City may terminate this Agreement and any other agreements to which the City and the Developer are or shall be parties, suspend disbursement of City Funds, place a lien on the Project in the amount of City Funds paid, and/or seek reimbursement of any City Funds paid. The City may, in any court of competent jurisdiction by any action or proceeding at law or in equity, pursue and secure any available remedy, including but not limited to damages, injunctive relief or the specific performance ofthe agreements contained herein. Upon the occurrence of an Event of Default under Section 8.06. the Developer shall be obligated to repay to the City all previously disbursed City Funds.

15.03 Curative Period. In the event the Developer shall fail to perform a monetary covenant which the Developer is required to perform under this Agreement, notwithstanding any other provision of this Agreement to the contrary, an Event of Default shall not be deemed to have occurred unless the Developer has failed to perform such monetary covenant within ten (10) days of its receipt of a written notice from the City specifying that it has failed to perform such monetary covenant. In the event the Developer shall fail to perform a non-monetary covenant which the Developer is required to perform under this Agreement, notwithstanding any other provision of this Agreement to the contrary, an Event of Default shall not be deemed to have occurred unless the Developer has failed to cure such default within thirty (30) days of its receipt of a written notice from the City specifying the nature of the default; provided, however, with respect to those non-monetary defaults which are not capable of being cured within such thirty (30) day period, the Developer shall not be deemed to have committed an Event of Default under this Agreement if it has commenced to cure the alleged default within such thirty (30) day period and thereafter diligently and continuously prosecutes the cure of such default until the same has been cured.

1101033196 Page: 53 of 73

SECTION 16. MORTGAGING OF THE PROJECT

All mortgages or deeds of trust in place as of the date hereof with respect to the Property or any portion thereof are listed on Exhibit G hereto (including but not limited to mortgages made prior to or on the date hereof in connection with Lender Financing) and are referred to herein as the "Existing Mortgages." Any mortgage or deed of trust that the Developer may hereafter elect to execute and record or permit to be recorded against the Property or any portion thereof is referred to herein as a "New Mortgage." Any New Mortgage that the Developer may hereafter elect to execute and record or permit to be recorded against the Property or any portion thereof with the prior written consent of the City is referred to herein as a "Permitted Mortgage." It is hereby agreed by and between the City and the Developer as follows:

(a) In the event that a mortgagee or any other party shall succeed to the Developer's interest in the Property or any portion thereof pursuant to the exercise of remedies under a New Mortgage (other than a Permitted Mortgage), whether by foreclosure or deed in lieu of foreclosure, and in conjunction therewith accepts an assignment of the Developer's interest hereunder in accordance with Section 18.15 hereof, the City may, but shall not be obligated to, attorn to and recognize such party as the successor in interest to the Developer for all purposes under this Agreement and, unless so recognized by the City as the successor in interest, such party shall be entitled to no rights or benefits under this Agreement, but such party shall be bound by those provisions of this Agreement that are covenants expressly running with the land.

(b) In the event that any mortgagee shall succeed to the Developer's interest in the Property or any portion thereof pursuant to the exercise of remedies under an Existing Mortgage or a Permitted Mortgage, whether by foreclosure or deed in lieu of foreclosure, and in conjunction therewith accepts an assignment of the Developer's interest hereunder in accordance with Section 18.15 hereof, the City hereby agrees to attorn to and recognize such party as the successor in interest to the Developer for all purposes under this Agreement so long as such party accepts all of the obligations and liabilities of "the Developer" hereunder; provided, however, that, notwithstanding any other provision of this Agreement to the contrary, it is understood and agreed that if such party accepts an assignment of the Developer's interest under this Agreement, such party has no liability under this Agreement for any Event of Default ofthe Developer which accrued priorto the time such party succeeded to the interest of the Developer under this Agreement, in which case the Developer shall be solely responsible. However, if such mortgagee under a Permitted Mortgage or an Existing Mortgage does not expressly accept an assignment of the Developer's interest hereunder, such

1101033196 Page: 54 of 73

party shall be entitled to no rights and benefits under this Agreement, and such party shall be bound only by those provisions of this Agreement, if any, which are covenants expressly running with the land.

(c) Prior to the issuance by the City to the Developer of a Certificate pursuant to Section 7 hereof, no New Mortgage shall be executed with respect to the Property or any portion thereof without the prior written consent of the Commissioner of DCD.

(d) Notwithstanding any provision in this Agreement to the contrary, the exercise of the remedies of foreclosure of a mortgage or any sale of Developer's interest in the Property in connection with a foreclosure, whether by judicial proceedings or by virtue of any power of sale contained in the mortgage, or any conveyance of Developer's interest in the Property to the mortgagee or its nominee or designee by virtue of or in lieu of foreclosure or other appropriate proceedings, or any conveyance of Developer's interest in the Property by the mortgagee or its nominee or designee to a third party, or any other exercise of remedies under the documents evidencing Lender Financing shall not require the consent or approval of the City or constitute a breach of any provision of or a default under this Agreement, unless such exercise shall result in the transfer of the Property to an Unacceptable Transferee. "Unacceptable Transferee" shall mean such party as is objectionable to the City because of any one or more existing uncured violations of the City's protocols or policies, and/or because the City is prohibited from entering into an agreement or business relationship with such party by the Municipal Code of Chicago, state or federal law and/or rules and regulations ofthe United States Department of Housing and Urban Development, as shall be solely determined by the City. The City shall advise the Developer and applicable lenders with reasonable dispatch whether a transfer to an Unacceptable Transferee would occur because ofthe exercise of remedies under the Lender Financing.

SECTION 17. NOTICE

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) telecopy or facsimile; (c) overnight courier, or (d) registered or certified mail, return receipt requested.

1101033196 Page: 55 of 73

City of Chicago

Department of Community Development 121 North LaSalle Street, Room 1000 Chicago, Illinois 60602 Attention: Commissioner

City of Chicago Department of Law 121 North LaSalle Street, Room 600 Chicago, Illinois 60602

Attention: Finance and Economic Development Division GX Chicago, LLC

1030 West Chicago Avenue, Suite 300 Chicago, Illinois 60642

Rolando Acosta, Esquire 6336 North Cicero Avenue Chicago, Illinois 60646

Until the later of the Completion Date or the date that the Related UBC Opportunity Fund, LP ("Senior Construction Lender") is no longer Developer's construction lender, notices shall also be given to the Senior Construction Lender as follows:

Related UBC Opportunity Fund, LP

do The Related Companies, L.P.

60 Columbus Circle

New York, New York 10023

Attention:

With a Copy To: Mark D. Yura, Esquire

DLA Piper

203 North LaSalle Street, Suite 1900 Chicago, Illinois 60601

If to the City:

With Copies To:

If to the Developer:

With Copies To:

1101033196 Page: 56 of 73

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) hereof shall be deemed received upon such personal service or upon dispatch. Any notice, demand or request sent pursuant to clause (c) shall be deemed received on the day immediately following deposit with the overnight courier and any notices, demands or requests sent pursuant to subsection (d) shall be deemed received two (2) business days following deposit in the mail.

SECTION 18. MISCELLANEOUS

18.01 Amendment. ThisAgreement and the Exhibits attached hereto may not be amended or modified without the prior written consent of the parties hereto; provided, however, that the City, in its sole discretion, may amend, modify or supplement Exhibit D hereto without the consent of any party hereto. It is agreed that no material amendment or change to this Agreement shall be made or be effective unless ratified or authorized by an ordinance duly adopted by the City Council. The term "material" for the purpose of this Section 18.01 shall be defined as any deviation from the terms of the Agreement which operates to cancel or otherwise reduce any developmental, construction or job-creating obligations of Developer (including those set forth in Sections 10.02 and 10.03 hereof) by more than five percent (5%) or materially changes the Project site or character of the Project or any activities undertaken by Developer affecting the Project site, the Project, or both, or increases any time agreed for performance by the Developer by more than ninety (90) days.

18.02 Entire Agreement. This Agreement (including each Exhibit attached hereto, which is hereby incorporated herein by reference) constitutes the entire Agreement between the parties hereto and it supersedes all prior agreements, negotiations and discussions between the parties relative to the subject matter hereof.

18.03 Limitation of Liability. No member, official or employee of the City shall be personally liable to the Developer or any successor in interest in the event of any default or breach by the City or for any amount which may become due to the Developer from the City or any successor in interest or on any obligation under the terms of this Agreement.

18.04 Further Assurances. The Developer agrees to take such actions, including the execution and delivery of such documents, instruments, petitions and certifications as may become necessary or appropriate to carry out the terms, provisions and intent of this Agreement.

1101033196 Page: 57 of 73

18.05 Waiver. Waiver by the City or the Developer with respect to any breach of this Agreement shall not be considered or treated as a waiver of the rights of the respective party with respect to any other default or with respect to any particular default, except to the extent specifically waived by the City or the Developer in writing. No delay or omission on the part of a party in exercising any right shall operate as a waiver of such right or any other right unless pursuant to the specific terms hereof. A waiver by a party of a provision of this Agreement shall not prejudice or constitute a waiver of such party's right otherwise to demand strict compliance with that provision or any other provision of this Agreement. No prior waiver by a party, nor any course of dealing between the parties hereto, shall constitute a waiver of any such parties' rights or of any obligations of any other party hereto as to any future transactions.

18.06 Remedies Cumulative. The remedies of a party hereunder are cumulative and the exercise of any one or more ofthe remedies provided for herein shall not be construed as a waiver of any other remedies of such party unless specifically so provided herein.

18.07 Disclaimer. Nothing contained in this Agreement nor any act of the City shall be deemed or construed by any of the parties, or by any third person, to create or imply any relationship of third-party beneficiary, principal or agent, limited or general partnership or joint venture, or to create or imply any association or relationship involving the City.

18.08 Headings. The paragraph and section headings contained herein are for convenience only and are not intended to limit, vary, define or expand the content thereof.

18.09 Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed an original and all of which shall constitute one and the same agreement.

18.10 Severability, If any provision in this.Agreement, or any paragraph, sentence, clause, phrase, word or the application thereof, in any circumstance, is held invalid, this Agreement shall be construed as if such invalid part were never included herein and the remainder of this Agreement shall be and remain valid and enforceable to the. fullest extent permitted by law.

18.11 Conflict. In the event of a conflict between any provisions of this Agreement and the provisions of the TIF Ordinances and/or the Bond Ordinance, if any, such ordinance(s) shall prevail and control.

1101033196 Page: 58 of 73

18.12 Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Illinois, without regard to fts conflicts of law principles.

18.13 Form of Documents. All documents required by this Agreement to be submitted, delivered or furnished to the City shall be in form and content satisfactory to the City.

18.14 Approval. Wherever this Agreement provides for the approval or consent of the City, DCD or the Commissioner, or any matter is to be to the City's, DCD's or the Commissioner's satisfaction, unless specifically stated to the contrary, such approval, consent or satisfaction shall be made, given or determined by the City, DCD or the Commissioner in writing and in the reasonable discretion thereof. The Commissioner or other person designated by the Mayor ofthe City shall act for the City or DCD in making all approvals, consents and determinations of satisfaction, granting the Certificate or otherwise administering this Agreement for the City.

18.15 Assignment. The Developer may not sell, assign or otherwise transfer its interest in this Agreement in whole or in part without the written consent ofthe City. Any successor in interest to the Developer under this Agreement shall certify in writing to the City its agreement to abide by all remaining executory terms of this Agreement, including but not limited to Sections 8,19 (Real Estate Provisions) and 8.23 (Survival of Covenants) hereof, for the Term of the Agreement. The Developer consents to the City's sale, transfer, assignment or other disposal of this Agreement at any time in whole or in part.

18.16 Binding Effect. This Agreement shall be binding upon the Developer, the City and their respective successors and permitted assigns (as provided herein) and shall inure to the benefit of the Developer, the City and their respective successors and permitted assigns (as provided herein). Except as otherwise provided herein, this Agreement shall not run to the benefit of, or be enforceable by, any person or entity other than a party to this Agreement and its successors and permitted assigns. This Agreement should not be deemed to confer upon third parties any remedy, claim, right of reimbursement or other right,

18.17 Force Majeure, Neither the City nor the Developer nor any successor in interest to either of them shall be considered in breach of or in default of its obligations under this Agreement in the event of any delay caused by damage or destruction by fire or other casualty, strike, shortage of material, unusually adverse weather conditions such as, by way of illustration and not limitation,

1101033196 Page: 59 of 73

severe rain storms or below freezing temperatures of abnormal degree or for an abnormal duration, tornadoes or cyclones, and other events or conditions beyond the reasonable control of the party affected which in fact interferes with the ability of such party to discharge its obligations hereunder. The individual or entity relying on this section with respect to any such delay shall, upon the occurrence ofthe event causing such delay, immediately give written notice to the other parties to this Agreement. The individual or entity relying on this section with respect to any such delay may rely on this section only to the extent of the actual number of days of delay effected by any such events described above.

18.18 Exhibits. All ofthe exhibits attached hereto are incorporated herein by reference.

18.19 Business Economic Support Act. Pursuant to the Business Economic Support Act (30 ILCS 760/1 et seq.), if the Developer is required to provide notice under the WARN Act, the Developer shall, in addition to the notice required under the WARN Act, provide at the same time a copy of the WARN Act notice to the Governor of the State, the Speaker and Minority Leader of the House of Representatives of the State, the President and minority Leader of the Senate of State, and the Mayor of each municipality where the Developer has locations in the State. Failure by the Developer to provide such notice as described above may result in the termination of all or a part of the payment or reimbursement obligations of the City set forth herein.

18.20 Venue and Consent to Jurisdiction. If there is a lawsuit under this Agreement, each party may hereto agrees to submit to the jurisdiction of the courts of Cook County, the State of Illinois and the United States District Court for the Northern District of Illinois.

18.21 Costs and Expenses. In addition to and not in limitation of the other provisions of this Agreement, Developer agrees to pay upon demand the City's out-of-pocket expenses, including attorney's fees, incurred in connection with the enforcement of the provisions of this Agreement. This includes, subject to any limits under applicable law, attorney's fees and legal expenses, whether or not there is a lawsuit, including attorney's fees for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals and any anticipated post-judgment collection services. Developer also will pay any court costs, in addition to all other sums provided by law.

18.22 Business Relationships. The Developer acknowledges (A) receipt of a copy of Section 2-156-030 (b) of the Municipal Code of Chicago, (B) that Developer has read such provision

1101033196 Page: 60 of 73

and understands that pursuant to such Section 2-156-030 (b), 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 City official or employee has a "Business Relationship" (as defined in Section 2-156-080 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 any person with whom the elected City official or employee has a "Business Relationship" (as defined in Section 2-156-080 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, and (C) that a violation of Section 2-156-030 (b) by an elected official, or any person acting at the direction of such official, with respect to any transaction contemplated by this Agreement shall be grounds for termination of this Agreement and the transactions contemplated hereby. The Developer 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 this Agreement or the transactions contemplated hereby.

[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

1101033196 Page: 61 of 73

IN WITNESS WHEREOF, the parties hereto have caused this Redevelopment Agreement to be executed on or as of the day and year first above written.

GX CHICAGO, LLC,

an Illinois limited liability company

By: Baum Real Estate Services, LLC,

an Illinois limited liability company, its manager

By: _

Manager

CITY OF CHICAGO

By:__

Andrew J. Mooney,

Acting Commissioner

Department of Community Development

1101033196 Page: 62 of 73

IN WITNESS WHEREOF, the parties hereto have caused this Redevelopment Agreement to be executed on or as of the day and year first above written.

GX CHICAGO, LLC,

an Illinois limited liability company

By: Baum Real Estate Services, LLC, an Illinois limited liability company, its manager

By: _

Douglas Baum Manager

CITY OF CHICAGO

a./].

By:_

Andrew J. Mooney, Acting Commissioner Department of Community Development

1101033196 Page: 63 of 73

STATE OF ILLINOIS )

)SS

COUNTY OF COOK )

I, jjfiAdPt'grf* ?ej£ u a notary public in and for the said County, in the State aforesaid,

DO HEREBY CERTIFY that Douglas Baum, personally known to me to be the Manager of Baum Real Estate Services, LLC, which is the Manager of GX Chicago, LLC, an Illinois limited liability company (the ADeveloper"), and personally known to me to be the same person whose name is subscribed to the foregoing instrument, appeared before me this day in person and acknowledged that he/she signed, sealed, and delivered said instrument, pursuant to the authority given to him/her by the members ofthe Developer, as his/her free and voluntary act and as the free and voluntary act of the Developer, for the uses and purposes therein set forth.

GIVEN under my hand and official seal thisbP/ day of December, 2010.

Notary Public

My Commission Expires 4'-<Q f- Jo//

(SEAL)

1101033196 Page: 64 of 73

STATE OF ILLINOIS )

)SS

COUNTY OF COOK )

., a notary public in and for the said County, in the State

aforesaid, DO HEREBY CERTIFY that Andrew J. Mooney, personally known to me to be the Acting Commissioner of the Department of Community Development of the City of Chicago (the "City"), and personally known to me to be the same person whose name is subscribed to the foregoing instrument, appeared before me this day in person and acknowledged that he signed, sealed, and delivered said instrument pursuant to the authority given to him by the City, as his free and voluntary act and as the free and voluntary act of the City, for the uses and purposes therein set forth.

GIVEN under my hand and official seal thisCv£ day of December, 2010.

My Commission Expires

1101033196 Page: 65 of 73

EXHIBIT A REDEVELOPMENT AREA (See Attached)

' COOK COUNTY RECORDER OF DEEDS SCANNED BY_

' COOK COUNTY

RECORDER OF DEEDS SCANNED 8Y-.

COOK COUNTY RECORDER OF DEEDS

SCANNED BY _---

1101033196 Page: 66 of 73

CITY OF CHICAGO ADDISON SOUTH TIF REDEVELOPMENT PROJECT AREA

LEGAL DESCRIPTION

That part of Sections 24 and 25, Township 40 North, Range 13 East of the Third Principal Meridian, and part of Section 30, Township 40 North, Range 14 East of said Third Principal Meridian, described as follows: Beginning at the intersection of the East line of the West Vz of the Northeast % of said Section 25 with the South line of West Belmont Avenue; thence East along the South line of said Belmont Avenue to the Southward extension of the West line of Lot 11 in County Clerk's Division of unsubdivided lands in the Southeast Va of said Section 24; thence North along the Southward extension of said Lot 11 to the North line of said Belmont Avenue; thence East along said North line to the West line of Campbell Avenue; thence North along the West line of said Campbell to the Northeast comer of said Lot 11; thence East along the Eastward extension of the North line of said Lot 11 to the East line of Campbell Avenue; thence North along the East line of said Campbell Avenue to the Westward extension of the South line of the North 23.10 feet of Lot 23 In North Chicago Sharpshooter's Addition to Chicago in the Southeast % of said Section 24; thence East along the last mentioned South line and its Westward extension to the West line of Western Avenue; thence South along the West line of said Western Avenue to the South line of said Belmont Avenue; thence East along the South line of said Belmont Avenue to the Northeasterly line of the 1* alley East of North Ctyboum Avenue in Block 13 of Clyboum Avenue Addition to Lake View and Chicago in the Northwest V* of said Section 30; thence Southeasterly along the Northeasterly line of said alley and its Southeasterly extension to the East line of Oakley Avenue; thence South along the East line of said Oakley Avenue and its Southward extension to the Eastward extension of the South line of Barry Avenue; thence West along the Eastward extension of Barry Avenue and along the South line thereof to the East line of the 1* alley West of Oakley Avenue in Block 11 In said Ctyboum Avenue Addition; thence South along the East line of said alley to the North line of Nelson Street; thence East along said Nelson Street and its Eastward extension to the East line of said Oakley Avenue; thence South along the East line of said Oakley Avenue to the North line of Wellington Avenue; thence East along the North line of said Wellington Avenue and its Eastward extension to East line of Leavitt Avenue; thence South along the East fine of said Leavitt Avenue and its Northward extension to the Eastward extension of the North line of Oakdale Avenue; thence West along the Eastward extension of the North line of said Oakdale Avenue and the North line of Oakdale Avenue to the Northward extension of the West line of Lot 13 in Drversey-Clybourn Industrial and Commercial District, being an Owners Division in the Northwest Quarter of said Section 30; thence South along said Northward extension and along the West line of said Lot 13 lo the Southwest comer thereof; thence East along the South line of sakt Lot 13 to the West line of Lot 12 In Diversey-Clyboum Industrial and Commercial District, aforesaid; thence South along the West line of said Lot 12 to the Northerly line of the North Branch of the Chicago River; thence Westerly and Northwesterly along the Northerly and Northeasterfy line of the said North Branch of the

B-1

1101033196 Page: 67 of_73

Chicago River to the Northward extension of the East line of Western Avenue; thence South along the Northward extension of the East line of Western Avenue and along the East line of said Western Avenue and its extensions to the North line of Diversey Avenue; thence East along the North line of said Diversey Avenue and Us Eastward extension to the East line of Oakley Avenue; thence North along the East line of said Oakley Avenue and its Northward extension to the Southerly line of the said North Branch of the Chicago River; thence Easterly and Southeasterly along the Southerly and Southwesterly line of said North Branch of the Chicago River to the South line of Diversey Avenue; thence West along the South line of said Diversey Avenue to the Westerly line of the said North Branch of the Chicago River; thence South and Southeasterly along the Westerly line and Southwesterly of said Chicago River to Southeast corner of tax ID #14-30-301-019; thence Southwesterly along the South line of said tax ID #14-30-301-019 to the Southwest comer thereof; thence Northwesterly along the Southwesterly line of said tax ID to the Southeasterly line of Logan Boulevard; thence Southwesterly along the Southeasterly line of said Logan Boulevard to the Northeasterly line of the Chicago and Northwestern Railroad Right of Way; thence Northwesterly along the Northeasterly line of said railroad right of way to the West line of Western Avenue; thence North along the West line of Western Avenue to the center line of Schubert Avenue; thence West along the center line of Schubert Avenue to the Southward extension of the West line of the 1^stalley West of Western Avenue, in Block 32 in Albert Crosby & Others Subdivision of the Southeast V* of said Section 25; thence North along the Southward extension of the West line of said alley to the Northeast comer of Lot 43 in said Block 32; thence West along said North line of said Lot 43 and along the Eastward extension of the North line of Lot 6 in Block 25 in said Crosby & Others Subdivision and continuing West along the North line of said Lot 6 and along the North line of Lot 43 and its Eastward extension in said Block 25 and continuing West along the North line of Lot 6 and Lot 38 and their Eastward extensions in Block 24 in said Crosby & Others Subdivision to the Northwest comer of said Lot 38; thence South along the West line of said Block 24 which is the East line of Maplewood Avenue to the Southwest comer of Lot 28 in said Block 24; thence East along the South line of said Lot 28 and Its Eastward extension to the East line of the 1" alley East of said Maplewood Avenue; thence South along the East line of said alley to the Northwest comer of Lot 19 in said Block 24; thence East along the North line of said Lot 19 and its Eastward extension to the East line of Campbell Avenue; thence South along the East line of said Campbell Avenue and its Southward extension to the Northeasterly line of said Chicago & Northwestern Railroad Right of Way; thence Northwesterly along the Northeasterly line of said Railroad to the West line of Talman Avenue; thence North along the West line of Talman Avenue to the Westward extension of the North line of the 1^st Alley North of Diversey Avenue in Wolfgram's Subdivision of the South 5 acres East of the Railroad of Lot 6 in Richon & Bauermeister's Subdivision of the West 34 of the Northeast Va of said Section 25; thence East along the heretofore described North line of an alley and continuing East along the Westward extension of the North line of the 1^s* alley North of Diversey Avenue in Block 4 in Carter's Addition to Maplewood, a subdivision of the South V* of the Southeast V* of the Northeast V* of said Section 25 and continuing East along said North line of an alley in said Block 4 and continuing East along the Westward extension of the 1^s* alley North of Diversey Avenue in Block 3 in said Carter's Addition to Maplewood and along the North line of said alley to the West line of Campbell Avenue; thence North along the West line of Campbell Avenue to the Southeasterly extension of the Southwesterty line of Elston Avenue; thence Northwesterly along said Southeasterly line of Elston Avenue to the Southward extension of the West line of Washtenaw Avenue; thence North along said Southward extension and along the West line of Washtenaw Avenue to the Westward extension of the North line of Barry Avenue; thence East along said westward extension and the North line of

B-2

1101033196 Page: 68 of 73

Barry Avenue to the Southeast corner of Lot 17 in the Subdivision of part of Lot 1 in Richon & Bauermeister's Subdivision of the West % of the Northeast V* of said Section 25, aforesaid; thence North along the East line of said Lot 17 to the Northeast comer thereof; thence West along the North line said Lot 17 and its Westward extension to the West line of the 1^rt Alley East of Washtenaw Avenue; thence North along the West line of the last described alley and its Northward and Southward extensions to the North line of the 1^st Alley South of Belmont Avenue in the Resubdivision of part of Lot 1 in said Richon & Bauermeister's Subdivision; thence East along the last described North line of an alley to the West line of Lot 9 in said Resubdfvison of part of Lot 1; thence North along the West line of said Lot 9 to the South line of Belmont Avenue; thence East along the South line of Belmont Avenue to the point of beginning, in Cook County, Illinois.

RECORDER OF DEEDS SCANNED BY__

B-3

1101033196 Page: 69 of 73

EXHIBIT B

PROPERTY Subject to Survey and Title Insurance

Legal Description

Lots 1 to 13, both inclusive, Lots 26 to 34, both inclusive, and the vacated alley running North and south lying between lots 1 TO 12 AND 26 TO 34, and also the vacated ALLEY LYING South of and adjoining said North and South vacated alley and South of lots 12,13,26,27, and 28 and adjoining said lots, and the right of way of the chicago and northwestern Railroad in Block 17 in Crosby's Subdivision of the East VS of the Southeast 1/4 of Section 25, township 40 north, range 13, east of the third principal meridian, in cook county, Illinois.

PIN

13-25-404-001-0000

Address Commonly known as:

2543-45 West Diversey Avenue

1101033196 Page: 70 of 73

EXHIBIT C TIF-FUNDED IMPROVEMENTS Line Item Cost Rehabilitation $29,684,517.65*

"Notwithstanding the total of TIF-Funded Improvements or the amount of TIF-eligible costs, the assistance to be provided by the City is limited to the amount described in Section 4.03 and shall not exceed the lesser of $10,000,000 or 18.5% of the Project Budget.

' COOK COUNTY RECORDER OF DEEDS SCANNED BY-_

1101033196 Page: 71 of 73

EXHIBIT G PERMITTED LIENS

1. Liens or encumbrances against the Property:

Those matters set forth as Schedule B title exceptions in the owner's title insurance policy issued by the Title Company as of the date hereof, but only so long as applicable title endorsements issued in conjunction therewith on the date hereof, if any, continue to remain in full force and effect.

2. Liens or encumbrances against the Developer or the Project, other than liens against the Property, if any: None

COOK COUNTY RECORDER OF DEEDS

SCANNED BY

1101033196 Page: 72 of 73

EXHIBIT H-1 PROJECT BUDGET

Uses

Purchase Price $ 8,000,000

Hard Costs $ 28,030,410

Tenant Improvements $ 7,670,693

Acquisition and Financing Costs $ 2,071,929

Legal, Accounting, Architects, Permits $ 2,766,681

Real Estate Taxes, Insurance, CAM $ 957,023

Project Furnishings, Equipment, Etc. $ 75,000

Marketing and Leasing Commissions $ 2,160,186

Contingency (Hard and Soft) $ 2,133,313

Construction Management/Developer Fee $ 2,500,000

Interest Reserves $ 5,336,028

Loan Discount $ (5,056,940)

TOTAL USES $ 56,644,323

Sources

Developer Equity $ 12,798,920

Deferred Construction Management/Dev Fee $ 2,500,000

Historic Tax Credits* $ 5,375,813

Ledcor Equity Advance $ 3,000,000

Senior Debt $ 17,969,590

HUD Section 108 Loan $ 15,000,000

TOTAL SOURCES $ 56,644,323

*A portion of the equity contributions for Historic credits is anticipated to be funded at construction completion/placement in service. These funds would not be available during construction and are therefore excluded from the budget above.

1101033196 Page: 73 of 73

EXHIBIT H-2 MBEA/VBE BUDGET

Hard Costs and Related Soft Costs $11,312,011

Required MBE@24% _ . _oo

$2,714,883

Required WBE@4% .

* 452,480

COOK COUNTY

RECORDER OF DEEDS SCANNED BY__

COOK COUNTY RECORDER OF DEEDS

SCANNED BY.--

ATTACHMENT K

CITY OF CHICAGO. ILLINOIS

ADDISON SOUTH REDEVELOPMENT PROJECT

FINANCIAL REPORT

DECEMBER 31, 2010

CITY OF CHICAGO, ILLINOIS

ADDISON SOUTH REDEVELOPMENT PROJECT

CONTENTS

Page

INDEPENDENT AUDITOR'S REPORTDN THE FINANCIAL STATEMENTS

AND SUPPLEMENTARY INFORMATION 1-2

Management's discussion and analysis 3-5

Statement of net assets and governmental fund balance sheet 6 Statement of activities and governmental fund revenues,

expenditures and changes in fund balance 7

Notes to financial statements 8-10

SUPPLEMENTARY INFORMATION

Schedule of expenditures by statutory code 11

Bansley and Kiener, L.L.P.

Certified Public Accountants

o'hare plaza 8745 west higgins road, suite 200 chicago, illinois 6063 i

area coot: 312 263.2700

INDEPENDENT AUDITOR'S REPORT

The Honorable Rahm Emanuel, Mayor Members of the City Council City of Chicago, Illinois

We have audited the accompanying financial statements of the Addison South Redevelopment Project of the City of Chicago, Illinois, as of and for the year ended December 31, 2010, as listed in the table of contents. These financial statements are the responsibility of the City of Chicago's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

As discussed in Note 1, the financial statements present only the Addison South Redevelopment Project and do not purport to, and do not present fairly the financial position of the City of Chicago, Illinois, as of December 31, 2010, and the changes in its financial position for the year then ended in conformity with accounting principles generally accepted in the United States of America.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Addison South Redevelopment Project of the City of Chicago, Illinois, as of December 31, 2010, and the changes in financial position thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America.

The Management's Discussion and Analysis on pages 3 through 5 is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it.

The Honorable Rahm Emanuel, Mayor Members of the City Council

-2-

Our audit was conducted for the purpose of forming an opinion on the financial statements taken as a whole. The schedule of expenditures by statutory code on page 11, which is also the responsibility of the City of Chicago's management, is presented for purposes of additional analysis and is not a required part of the financial statements of Addison South Redevelopment Project of the City of Chicago, Illinois. Such additional information has been subjected to the auditing procedures applied in the audit of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole.

Certified Public Accountants

June 9, 2011

CITY OF CHICAGO, ILLINOIS ADDISON SOUTH REDEVEI OPMENT PROJECT

MANAGEMENT'S DISCUSSION AND ANALYSIS (UNAUDITED)

As management of the Addison South Tax Increment Redevelopment Project Area (Project), we offer the readers of the Project's financial statements this narrative overview and analysis of the Project's financial performance for the year ended December 31, 2010. Please read it in conjunction with the Project's financial statements, which follow this section.

Overview of the Financial Statements

This discussion and analysis is intended to serve as an introduction to the Project's basic financial statements. The Project's basic financial statements include three components: 1) government-wide financial statements, 2) governmental fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information concerning the Project's expenditures by statutory code.

Basic Financial Statements

The basic financial statements include two kinds of financial statements that present different views of the Project - the Government-Wide Financial Statements and the Governmental Fund Financial Statements. These financial statements also include the notes to the financial statements that explain some of the information in the financial statements and provide more detail.

Government-Wide Financial Statements

The government-wide financial statements provide both long-term and short-term information about the Project's financial status and use accounting methods similar to those used by private-sector companies. The statement of net assets includes all of the project's assets and liabilities. All of the current year's revenues and expenses are accounted for in the statement of activities regardless of when cash is received or paid. The two government-wide statements report the Project's net assets and how they have changed. Net assets - the difference between the Project's assets and liabilities - is one way to measure the Project's financial health, or position.

Governmental Fund Financial Statements

The governmental fund financial statements provide more detailed information about the Project's significant funds - not the Project as a whole. Governmental funds focus on: 1) how cash and other financial assets can readily be converted to cash flows and 2) the year-end balances that are available for spending. Consequently, the governmental fund statements provide a detailed short-term view that helps determine whether there are more financial resources that can be spent in the near future to finance the Project. Because this information does not encompass the additional long-term focus of the government-wide statements, we provide additional information at the bottom of the statements to explain the relationship (or differences) between them.

CITY OF CHICAGO. ILLINOIS ADDISON SOUTH REDEVELOPMENT PROJECT

MANAGEMENT'S DISCUSSION AND ANALYSIS (UNAUDITED) (Continued)

Notes to the Financial Statements

The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and governmental fund financial statements. The notes to the financial statements follow the basic financial statements.

Other Supplementary Information

In addition to the basic financial statements and accompanying notes, this report also presents a schedule of expenditures by statutory code. This supplementary information follows the notes to the financial statements.

Condensed Comparative Financial Statements

The condensed comparative financial statements are presented on the following page. Analysis of Overall Financial Position and Results of Operations

Property tax revenue for the Project was $2,983,664 for the year. This was an increase of 29 percent over the prior year. The change in net assets produced an increase in net assets of $2,892,817. The Project's net assets increased by 65 percent from the prior year making available $7,355,762 of funding to be provided for purposes of future redevelopment in the Project's designated area. Expenses increased this year due to the Project's formulation of a redevelopment plan or necessary funding was substantially complete and available.

CITY OF CHICAGO. ILLINOIS ADDISON SOUTH REDEVELOPMENT PROJECT

MANAGEMENT'S DISCUSSION AND ANALYSIS (UNAUDITED) (Concluded)

Government-Wide

2010 2009 Change % Change

Total assets $7,402,346 $4,492,957 $2,909,389 65%

Total liabilities 46,584 30,012 16,572 55%

Total net assets $7,355,762 $4,462,945 $2,892,817 65%

Total revenues $2,987,178 $2,313,192 $ 673,986 29%

Total expenses 94,361 32,650 61,711 189%

Changes in net assets 2,892,817 2,280,542 612,275 27%

Ending net assets $7,355,762 $4,462,945 $2,892,817 65%

CITY OF CHICAGO. ILLINOIS ADDISON SOUTH REDEVELOPMENT PROJECT

STATEMENT OF NET ASSETS AND GOVERNMENTAL FUND BALANCE SHEET DECEMBER 31, 2010

ASSETS

Cash and investments Property taxes receivable Accrued interest receivable Total assets

LIABILITIES

Vouchers payable Due to other City funds Deferred revenue

Total liabilities

FUND BALANCE/NET ASSETS

Fund balance: Designated for future redevelopment project costs

Total liabilities and fund balance

Net assets: Restricted for future redevelopment project costs

Total net assets

Governmental Fund

$ 4,858,992

2,540,000

3,354

7,790 38,794 2,077,951 2,124,535

5,277,811

$ 7,402,346

Adjustments

$ 7,402,346 $

(2,077,951) (2,077,951)

(5,277,811)

Statement of

Net Assets $ 4,858,992 2,540,000

_3,354

$ 7,402,346

7,790 38,794

46,584

7,355,762 7,355,762

$ 7,355,762 $ 7,355,762

Amounts reported for governmental activities in the statement of net assets are different because: Total fund balance - governmental fund

Property tax revenue is recognized in the period for which levied rather than when "available". A portion of the deferred property tax revenue is not available.

$ 5,277,811

2,077,951

Total net assets - governmental activities

$ 7,355,762

The accompanying notes are an integral part of the financial statements.

CITY OF CHICAGO. ILLINOIS ADDISON SOUTH REDEVELOPMENT PROJECT

STATEMENT OF ACTIVITIES AND GOVERNMENTAL FUND REVENUES. EXPENDITURES

AND CHANGES IN FUND BALANCE FOR THE YEAR ENDED DECEMBER 31, 2010

Revenues:

Property tax Interest

Total revenues

Expenditures/expenses:

Economic development projects

Excess of revenues over expenditures

Change in net assets

Fund balance/net assets: Beginning of year

End of year

Governmental Fund

2,454,672

94,361

2,360,311

2,917,500

Adjustments

$ 2,451,158 $ 532,506 3,514

532,506

(2,360,311) 2,892,817

1,545,445

Statement of Activities

$ 2,983,664 3,514

2,987,178

94,361

2,892,817

4,462,945

$ 5,277,811 $ 2,077,951 $ 7,355,762

Amounts reported for governmental activities in the statement of activities are different because:

Net change in fund balance - governmental fund $ 2,360,311

Property tax revenue is recognized in the period for which levied rather than when "available". A portion of the deferred property tax revenue is not available. 532,506

Change in net assets - governmental activities

$ 2,892,817

The accompanying notes are an integral part of the financial statements.

CITY OF CHICAGO. ILLINOIS ADDISON SOUTH REDEVELOPMENT PROJECT

NOTES TO FINANCIAL STATEMENTS

Note 1 - Summary of Significant Accounting Policies

(a) Reporting Entity

In May 2007, the City of Chicago (City) established the Addison South Tax Increment Redevelopment Project Area (Project). The area has been established to finance improvements, leverage private investment and create and retain jobs. The Project is accounted for within the special revenue funds of the City.

(b) Government-Wide and Fund Financial Statements

The accompanying financial statements of the Project have been prepared in conformity with generally accepted accounting principles as prescribed by the Governmental Accounting Standards Board (GASB). In June 1999, the GASB unanimously approved Statement No. 34 (as amended by Statement No. 37), Basic Financial Statements - Management's Discussion and Analysis - for State and Local Governments and at a later date, Statement No. 38 Certain Financial Statements Disclosures, and include the following:

A Management Discussion and Analysis (MD&A) section providing an analysis of the Project's overall financial position and results of operations.

Government-wide financial statements prepared using the economic resources measurement focus and the accrual basis of accounting for all the Project's activities. Fund financial statements, which focus on the Project's governmental funds current financial resources measurement focus.

(c) Measurement Focus, Basis of Accounting and Financial Statements Presentation

The government-wide financial statements are reported using the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied.

The governmental fund financial statements are prepared on the modified accrual basis of accounting with only current assets and liabilities included on the balance sheet. Under the modified accrual basis of accounting, revenues are recorded when susceptible to accrual, i.e., both measurable and available to finance expenditures of the current period. Available means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Property taxes are susceptible to accrual and recognized as a receivable in the year levied. Revenue recognition is deferred unless the taxes are received within 60 days subsequent to year-end. Expenditures are recorded when the liability is incurred.

Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in government-wide financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. The City has elected not to follow subsequent private-sector guidance.

When both restricted and unrestricted resources are available for use, it is the City's policy to use restricted resources first, then unrestricted resources, as they are needed.

CITY OF CHICAGO. ILLINOIS ADDISON SOUTH REDEVELOPMENT PROJECT

NOTES TO FINANCIAL STATEMENTS (Continued)

Note 1 - Summary of Significant Accounting Policies (Concluded)

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Accordingly, actual results could differ from these estimates.

(d) Assets, Liabilities and Net Assets Cash and Investments

Cash belonging to the City is generally deposited with the City Treasurer as required by the Municipal Code of Chicago. The City Comptroller issues warrants for authorized City expenditures which represent a claim for payment when presented to the City Treasurer. Payment for all City warrants clearing is made by checks drawn on the City's various operating bank accounts.

The City Treasurer and City Comptroller share responsibility for investing in authorized investments. Interest earned on pooled investments is allocated to participating funds based upon their average combined cash and investment balances.

The City values its investments at fair value or amortized cost. U.S. Government securities purchased at a price other than par with a maturity of less than one year are reported at amortized cost.

Capital Assets

Capital assets are not capitalized in the governmental fund but, instead, are charged as current expenditures when purchased. The Government-wide financial statements (i.e., the statement of net assets and the statement of changes in net assets) of the City includes the capital assets and related depreciation, if any, of the Project in which ownership of the capital asset will remain with the City (i.e. infrastructure, or municipal building). All other construction will be expensed in both the government-wide financial statements and the governmental fund as the City nor Project will retain the right of ownership.

(e) Stewardship, Compliance and Accountability

Illinois Tax Increment Redevelopment Allocation Act Compliance

The Project's expenditures include reimbursements for various eligible costs as described in subsection (q) of Section 11-74.4-3 of the Illinois Tax Increment Redevelopment Allocation Act and the Redevelopment Agreement relating specifically to the Project. Eligible costs include but are not limited to survey, property assembly, rehabilitation, public infrastructure, financing and relocation costs.

Reimbursements

Reimbursements, if any, are made to the developer for project costs, as public improvements are completed and pass City inspection.

CITY OF CHICAGO. ILLINOIS ADDISON SOUTH REDEVELOPMENT PROJECT

NOTES TO FINANCIAL STATEMENTS (Concluded)

Note 2 - Commitments

The City has pledged certain amounts solely from available excess incremental taxes to provide financial assistance to a developer under the terms of a redevelopment agreement for the purpose of paying costs of certain eligible redevelopment project costs.

SUPPLEMENTARY INFORMATION

ICAGO. ILLINOIS ADDISON SOUTH RFDEVEI OPMENT PROJECT

SCHEDULE OF EXPENDITURES BY STATUTORY CODE

Code Description

Costs of studies, surveys, development of plans and specifications, implementation and administration of the redevelopment plan including but not limited to staff and professional service costs

for architectural, engineering, legal, marketing $94,361

ATTACHMENT L

BANSLEY AND KlENER, L.L.P.

Certified Public Accountants

Established 1922

O'HARE PLAZA 8745 WEST HIGGINS ROAD SUITE 200 CHICAGO, ILLINOIS 60631 312,263.2700 FAX 31 2.263.6935 WWW.bk-cpa.com

The Honorable Rahm Emanuel, Mayor Members of the City Council City of Chicago, Illinois

We have audited, in accordance with auditing standards generally accepted in the United States of America, the statement of net assets and governmental fund balance sheet of Addison South Redevelopment Project of the City of Chicago, Illinois as of December 31, 2010, and the related statement of activities and governmental fund revenues, expenditures and changes in fund balance for the year then ended, and have issued our report thereon dated June 9, 2011.

In connection with our audit, nothing came to our attention that caused us to believe that the Project failed to comply with the regulatory provisions in Subsection (q) of Section 11-74.4-3 of the Illinois Tax Increment Allocation Redevelopment Act and Subsection (o) of Section 11-74.6-10 of the Illinois Industrial Jobs Recovery Law as they relate to the eligibility for costs incurred incidental to the implementation of the Addison South Redevelopment Project of the City of Chicago, Illinois.

This report is intended for the information of the City of Chicago's management. However, this report is a matter of public record, and its distribution is not limited.

INDEPENDENT AUDITOR'S REPORT

Certified Public Accountants

June 9, 2011

Members: American Institute of CPA's Illinois CPA Society An Independent Firm Associated with Moore Stephens

ATTACHMENT M

INTERGOVERNMENTAL AGREEMENTS FY 2010

A list of all intergovernmental agreements in effect in FY 2010 to which the municpality is a part, and an accounting of any money transferred or received by the municipality during that fiscal year pursuant to those intergovernmental agreements. [65 ILCS 5/11-74.4-5 (d)(10)]_

Name of Agreement	description of Agreement	Amount Transferred Out	Amount Received
None

FY 2010

TIF Name: Addison South Redevelopment Proiect Area

Addison South Redevelopment Project Area 2010 Annual Report

Legislation Text

Legislation Details

Legislation Details (With Text)