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HomeMy WebLinkAbout2003-07-28 03-246 ORDERCOUNCIL ACTION Item N0. 03-246 Date: July 28. 2003 Dem/Subject ORDER - Authorizing City Manager to Execute a Sixth Addendum t0 Lease - General Electric Company Responsible Department: Legal This amendment is to adjust the rent amounts due the City from General Electric to conform with refinancing of the can 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 Company is the Guarantor. The City's lease agreements with GE and GE's loan guarantee provide 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 additional lease amount sufficient be pay the debt service 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. This arrangement to finance new buildings and expansions to the City's buildings used by GE works for all and keeps the debt off the City's books and avoids any risk to the City. The Council passed a similar Order June 9, 2003 with the expectation of a June 2003 loan dosing which did not take place. The can dosing is presently scheduled for July 31, 2003. Due to the uncertainty of the exact closing date, the present Order for the Council's consideration refers only to a "2003" Promissory Note and Loan Agreement (the earlier order referred be a "June 2003" Promissory Note and Loan Agreement). Staff recommends approval. Department Head Manager's Comments: Recommend! approval of this minor technical adju4ment � Id (/•.�[`�// City Manager Associated Information Approval: Introduced for Consent X Passage First Reading Page _ of _ Referral 03-246 Assigced to Councilor sohnan July 28, 2003 o CITY OF BANGOR (TITLE.) Order, Authorizing the City Manger to Ekecute a Sixth Addendum to Leaser Assignment and Subordination Agreement and Consent to Conditional Assignment of Leases and Rents -- General Electric Company eythe tky Couno/Ofine Oty, OfBango: THAT, the City Manager is authorized, on behalf of the City ofBamgn, to execute s Sixth Addendum to Lease with General Elwoic Company to revise the rental amounts presently due under Article III (B)(1) and III (E)(2) of the 1993 Amended and Restated Indenmte of Lease, as previously amended and revised, to conform to the debt service schedule for the 2003 Promissory Note and Loan Agreement between Bangor Target Are Development Corpomtioa and Fleet National Behr. The City Manager is further authorized to execute an Assigmnent and Subordination Agreement by aM between the City of Bangor, Bangor Area Development Corporation and Fleet National Bank and a Consent to Conditional Assignment of Leave and Rentals between Target Are Development Corporation and Fleet National Bank. 1 CITT COp L July 28. 2003 aaarA p 03-286 0 HM6A OE) AutmrizivS tbe City naoeger to cute acSuhordivation ASret and[ e Consent to C L'_ ..elan_. .__.—-tm______ _______ts- Geu¢vl electric Company Assgnedto Councilor 6Rmhh ..p