HomeMy WebLinkAbout2008-01-28 08-069 ORDERDate: January 28, 2008 Item ria 08 069
Item/Subject: ORDER, Authorizing the City Manager to Execute a Seventh Addendum to tease,
Asignmerd and Subordination Agreement and Consent to Conditional Assignment of
Leases and Rents —General Electric Company
Responsible Department: Legal
Commentary:
This amendment will adjust the rent amounts due to the City from General Electric to conform with
refinancing of the loan which financed GE's building expansions in the BIA Commercial/Industrial Park.
The expansions were financed by Fleet National Bank through a loan to the Bangor Target Area
Development Corporation for which General Electric is the Guarantor. The City's lease agreements
with GE and GE's loan guarantee pmvice security for Target's loan from Fleet. The rental payments
paid by GE to the City Include a base lease amount which the City retains and an ac lonal lease
amount sufficient to pay the debt seMce on the Target loan from Fleet. The City assigns the
additional lease payments it receives from GE to Target. Target then uses the lease payment revenue
to make loan payments due to Fleet. "is financing arrangement works well for all partes, keeps the
debt off the City's books, and avoids any risk to the City.
The loan dosing is presently scheduled for February 1, 2008. Due to the uncertainty of the exact
closing date, this Order refers only m a "2008" Promissory Note and Loan Agreement between Bangor
Target Area Development Corporation and Key Bank, the Bank currently providing Uis financing. Staff
recommends approval.
Department Head
Manager's Comments:
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Associated Information
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Gv� Asupol w Councilor Parr3agtw Jauuar2 28. 2008
CITY OF BANGOR
(TIRE.) ORDEk Authorizing the City Manager to Execute a Seventh Addendum m Lease,
Assignment and Subordinadon Agreement and Consent to Conditional Assignment
of Losses and Rents —General Electric Company
BE IT ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR THAT
The City Manager is authorized, on behalf of the any of Bangor, W execute a Seventh
Addendum to Lease with General Electric Company to revise the rental amounts presently due
under Article IR (B)(1) and III (E)(2) of the 1993 Amended and Restated Indenture of Lease,
as previously amended and revised, to conform M the debt service schedule for Me 2008
Promissory Note and Loan Agreement between Bangor Target Area Development Corporation
and Key Bank. The City Manager is fuller authorized M execute an Assignment and
Subordination Agreement by and between the City of Bangor, Bangor Target Area Development
Corporation and Key Bank and a Consent to Conditional Assignment of Lease and Rentals
between Bangor Target Area Development Corporation and Key Bank, In a final form approved
by the City Solidtor or Assistant City S Ilcitor.
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Execute a Seventh MdeMum to Leas
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