2017-05-15 - Ordinance 2017-023 - APPROVING ECONOMIC INCENTIVE AGREEMENT WITH ZONATHERM PRODUCTS INC 875 BUSCH PKWY1417-1 4,1111111 - 11111 - �� lie, 0 1
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and Between the Village of Buffalo Grove and Zonatherm
Products, Inc.
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the Village, and to assist with their project in the Village, the Village agrees, pursuant to the
terms of this Agreement, to share sales tax received by the Village using a formula which
corresponds to new sales tax revenue generated by the Business over a finite period of
time.
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FUMINXIM: :
LWOW
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Janet �1. tirabian, Village Clerk
iwolm
Village President
•UTSIAMAMALIVio
aGRUVE
ECONOMIC INCENTIVE AGREEMENT
BY AND BETWEEN
THE VILLAGE OF BUFFALO GROVE
AND
ZONATHERM PRODUCTS, INC.
This Agreement (the 'Agreement") is made and entered into as of the day of
2017, by and between the Village of Buffalo Grove , an Illinois home rule
municipal% corporation (the "Village") and Zonatherm Products, Inc., an Illinois corporation
("Zonatherm").
In consideration of the recitals and mutual covenants and agreements set forth herein,
the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
SECTION 1. RECITALS.
A. Zonatherm currently conducts its business at the property commonly known as
251 Holbrook Drive, Wheeling, Illinois.
B. Zonatherm desires to relocate its business into the Village of Buffalo Grove and
construct a new Headquarters at 875 Busch Parkway, Buffalo Grove, Illinois, hereinafter
referred to as the "Premises" (as legally described on Exhibit A hereto) and to operate its
distribution of electrical HVAC equipment and supplies,
C. The single order acceptance point for Zonatherm's Business is conducted from
the Premises.
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E. As of the date of this Agreement, the total sales tax rate within Lake County,
Illinois applicable on the sale of certain tangible personal property is eight percent (8%); the
State of Illinois portion which is six and one -quarter percent (6.25%), Village's Home Rule
portion of which is one percent (1%) and the Regional Transportation Authority portion which is
three-quarters of one percent (0.75%).
F. The Village has the power and authority to enter into this Agreement pursuant
but without limitation, the home rule powers of the Village under Section 6, Article V11 of t
1970 Constitution of the State of 11lixois.
G. The control and conduct of the operation of Zonatherm and its Business
managed by Stephen K. Izzo, President. i
A. The language in this Agreement shall be interpreted in accordance with th-.
following rules of construction: (a) The word "may" is permissive and the word "shall" is
mandatory; and (b) except where the context reveals the contrary. The singular includes the
plural and the plural includes the singular, and the masculine gender includes the feminine and
neutral.
B. Whenever used in the upper case in this Agreement, the following words shall
have the following meanings:
2. Audit. Undertaken at the sole cost and expense of the Village, a review of all of
the books and records of the Business of Zonatherm by the financial Consultant
for the purpose of making a determination of the amount of Municipal Sales Tax
the Village should have received under the terms of this Agreement and for the
purpose of verifying Zonatherm's compliance with the terms of this Agreement.
3. Business. All of the sales operations of Zonatherm and its affiliates that occur
on the Premises, including but not limited to, the distribution and sales of
electrical HVAC equipment and supplies.
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5. Consultant. The person, firm or corporation and agents thereof authorized by
the Village to conduct an Audit, at the sole cost and expense of the Village, of the
Business regarding all transactions occurring during any given Sales Tax Year
following the date of this Agreement.
Gross Receipts. The term "Gross Receipts" shall have the same meaning as
that which is ascribed to it in the Illinois Retailers' Occupation Tax Act.
7. Home Rule Sales Tax. The one percent (1%) sales tax imposed in the Village
pursuant to Village's Home Rule Sales Tax Ordinance No. 2004-16 enacted in
accordance with the Home Rule Municipal Retailers' Occupation Tax Act (65
ILCS 5/8-11 -1) and the Home Rule Municipal Service Occupation Tax Act (65
ILCS 5/8-11-5). Pursuant to the Home Rule Municipal Retailers' Occupation Tax
Act, said tax shall not be imposed upon an item of tangible personal property
titled or registered with an agency of the State of Illinois.
91. Incremental Municipal Sales Tax. The addonal Municipal Sales Taxi
generated by Zonatherm in excess of the base Municipal Sales Tax to the Villag-.
of $100,000,
4P. Municipal Sales Tax. That portion or component of the Village's Home Rule
Sales Tax (1 %) generated on the Premises that the Village receives from the
State of Illinois, not including the Village's share of the Retailer's Occupation Tax.
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A. The Village shall pay Zonatherm the Municipal Sales Tax Payment on or before
the Payment Date an amount equal to the following formulas:
1For the first Sales Tax Year, one -hundred percent (100%) of that year's
Incremental Municipal Sales Tax above the base Municipal Sales Tax to the
Village of $100,000.
2. For the second Sales Tax Year, ninety percent (90%) of that year's Incremental
Municipal Sales Tax above the base Municipal Sales Tax to the Village of
$100,000.
3. For the third Sales Tax Year, eighty percent (80%) of that year's Incremental
Municipal Sales Tax above the base Municipal Sales Tax to the Village of
$100,000.
AC For the fourth Sales Tax Year, seventy percent (70%) of that year's Incremental
Municipal Sales Tax above the base Municipal Sales Tax to the Village of
$100,000.
5. For the fifth Sales Tax Year, sixty percent (60%) of that year's Incremental
Municipal Sales Tax above the base Municipal Sales Tax to the Village of
$100,000.
6For the sixth Sales Tax Year, fifty percent (50%) of that year's Incremental
Municipal Sales Tax above the base Municipal Sales Tax to the Village of
$100,000.
7. For the seventh Sales Tax Year, fifty percent (50%) of that year's Incremental
Municipal Sales Tax above the base Municipal Sales Tax to the Village of
$100,000.
B. The amount due pursuant to this Agreement shall not be a general obligation of
the Village. The Village shall not have an obligation to pay any amounts to Zonatherm except
an amount equal to the Village's Municipal Sales Tax share actually received from Illinois
Department of Revenue on account of the Business and not exceeding the Sales Tax rates as
set forth in this Agreement.
C. The Tillage shall continue the Municipal Sales Tax Payments for seven (7) years
through the term of this Agreement or the payment to Zonatherm of five -hundred thousand
dollars ($500,000), whichever comes first.
D. In the event that any Sales Tax returns that have been submitted to the Village
are amended, Zonatherm shall promptly forward a photocopy of such amended sales tax
returns to the Village, clearly identifying them as an amendment of a Sales Tax return previously
submitted to the Village.
E. Should Zonatherm cease its Business on the Premises within seven (7) years of
the Commencement Date of this Agreement or conduct less than one -thousand dollars ($1,000)
in Sales Tax in any Sales Tax Year, then Zonatherm shall reimburse to the Village 100% of the
Municipal Sales Tax Payments received pursuant to this Agreement. Said reimbursement to
the Village shall be made within ninety (90) days of cessation of the Business or at the end of
the Sales Tax Year in which Sales Tax is less than one -thousand dollars ($1,000). The Village
shall have the right to place a lien upon the Premises to guarantee payment of the
reimbursement amount.
FZonatherm shall provide, upon request by the Village, certified copies of all
zxpenses relating to and in conjunction with the construction of their new facility at 875 Busch
Parkway, Buffalo Grove, Illinois prior to any Municipal Sales Tax Payment.
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or inhibit the ability of either party to perform its obligations under, or otherwise to comply with,
this Agreement ("Litigation"), the party against which the Litigation is filed or initiated shall
promptly deliver a copy of the complaint or charge related thereto to the other party and shall
thereafter keep the other party fully informed concerning all aspects of the Litigation.
B. Defense. The Village and Zonatherm each agree to use their respective best
efforts to defend the validity of this Agreement, and all ordinances and resolutions adopted and
agreements executed pursuant to this Agreement, including every portion thereof and every
approval given, and every action taken, pursuant thereto.
SECTION 5. REMEDIES.
A. Remedies. In the event of a breach or an alleged breach of this Agreement by
either party, either party may, by suit, action, mandamus, or any other proceeding, in law or in
equity, including specific performance, enforce or compel the performance of this Agreement.
Any claim or suit related to this Agreement shall be filed in the Circuit Court of Lake County.
The prevailing party shall be entitled to recovery of its attorney's fees and costs.
B. Notice and Cure. Neither party may exercise the right to bring any suit, action,
mandamus or any other roceeding g r
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A. Complete Agreement; Supersedence. This Agreement constitutes t
complete agreement of the parties regarding the payment of the Incremental Municipal Sal
Tax to Zonatherm and shall supersede and nullify all prior drafts and agreements concerni
the payment of the Incremental Municipal Sales Tax to Zonatherm. I
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C. Notices, Any notice or other communication required or permitted to be giv
under this Agreement shall be in writing, and shall be deemed delivered to and received by t
addressee thereof when delivered in person at the address set forth below, or three busine
days after deposit thereof in any main or branch United States Post Office, certified
registered mail, return receipt requested, postage prepaid, properly addressed to the partie
respectively, as follows: �1
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11,11liarn G. Raysa, Esq.
Tressler LLP,
233 S Wacker Drive, 22dFloor
Chicago, IL. 60606
Zonatherm Products, Inc.
875 Busch Parkway
Buffalo Grove, IL 60089
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specifically and only arising from the subject matter referred to in this Agreement. Zonatherm
covenants that it will reimburse the Village, or pay over to the Village, all sums of money the
Village pays, or becomes liable to pay, by reason of any of the foregoing, and will make
payment to the Village as soon as the Village becomes liable therefore. In any suit or
proceeding brought hereunder, the Village shall have the right to appoint counsel of its own
choosing to represent
E. Governing Law. This Agreement and the rights of the parties hereunder shal-.
be governed by, and construed, interpreted, and enforced in accordance with, the internal laws,
2nd not the conflict of law rules of the State of Illinois,
F. Interpretation. This Agreement has been negotiated by all parties and shall n
be interpreted or construed against the party drafting the Agreement. I
G. Change in Laws. Unless otherwise explicitly provided in this Agreement, any
reference to laws, ordinances, rules, or regulations of any kind shall include such laws,
ordinances, rules, or regulations of any kind as they may be amended or modified from time to
time hereafter.
H. Headings. The headings of the sections, paragraphs, and other parts of this
Agreement are for convenience and reference only and in no way define, extend, limit, or
describe the meaning, scope, or intent of this Agreement, or the meaning, scope, or intent of
any provision hereof.
1. Time of Essence. Time is of the essence in the performance of all terms a
provons of this Agreement. I
J. Severability. It is the express intent of the parties hereto that should a
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provision, covenant, agreement, or portion of this Agreement or its application to any perso
entity, or property be held void, invalid, or unenforceable by a court of competent jurisdictio
such action shall not effect the remainder of this Agreement, which shall continue in full for
and eiect.
K. No Third Party Beneficiaries. Nothing in this Agreement shall create, or I
construed to create, any third party beneficiary rights in any person or entity not a signatory
this Agreement.
L. Counterparts. This Agreement may be executed in any number of multip
identical counterparts and all of said counterparts shall, individually and taken togeth
constitute the Agreement. I
M. Assignment. Zonatherm may not assign this Agreement or the amounts, in
whole or part, to be paid hereunder without the Village's prior written consent. The Village
acknowledges that this Agreement is an obligation which runs to Zonathenn and is not a
covenant running with the land except to the extent for filing a lien against the Premises.
Notwithstanding the foregoing, in the event that Zonatherm sells all of its assets, or the
principals of Zonatherm sells all or substantially all of their stock, and following the sale, the
operations of the Business remain substantially the same and in conformance with all
obligations of the Agreement, this Agreement will remain in full force and affect and the Village
will grant its approval of the Assignment of the Agreement. The assignee is bound by all of the
terms and conditions of the Agreement.
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0. Audit. Upon prior written notice to Zonatherm, and at a place and time that is
mutually beneficial to both parties, the Village shall have the right to conduct an Audit of
Zonatherm to inspect and review those books and records which are directly related to
establishing Gross Receipts for any Sales Tax Year, or any portion thereof.
P. No Village Obligation. The parties acknowledge and agree that none of the
terms, conditions or provisions of this Agreement shall be construed, deemed, or interpreted as
(I) a restriction or prohibition on the Village from eliminating or amending it Home Rule Sales
funds for the Incremental Municipal Sales Tax Payment.
Q. Loss of Authority. In the event that the Village's authority to enter into this
Agreement or to pay the Incremental Municipal Sales Tax Payment to Zonatherm, pursuant to
this Agreement are repealed, become unexercisable, null and void or otherwise become invalid
*f the Village.
R. Certifications. Each party hereto certifies hereby that it is not barred from
entering into this Agreement as a result of violations of either Sections 33E-3 or 33E-4 of the
Illinois Criminal Code (720 ILCS 5/33 —E-3, 5/33-E-4), that it has a written policy against sexual
harassment in place in full compliance with 775 ILCS 5/2-105(A)(4), and it is in compliance with
the Illinois Drug Free Workplace Act (30 ILCS 580/2).
S. Prevailing Wage. Zonatherm shall comply with the Illinois Prevang Wage Act
`820 ILCS 130/0.01) during the term of this agreement.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly
P--uthodzed representatives as of the date first above written.
. . . . . . . . . .
Beverly-§6- man
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Village President
Janet -tirabian
Village Clerk
Zonatherm Products, Inc.
By-
Step an K. Izzo,
its: TREE
President
EliI.n
,
ignature 144
Printed Name
CATHLL0EFEFN1C1ALSEAL::
IN
G20IN2i5 IZREuBuS, STATE OF IL:01
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This instrument was acknowledged before me on ffi,,�j IU , 2017 bv
Beverly Sussman, the Village President of the VILLAGE OF BUFFAL-b GROVE, an Illinoi's
home rule municipal corporation, and by Janet Sirabian, the Village Clerk of said municipal
corporation.
]Ehlhie Julie
Notary Public - State of Minois
My Commission Expims
04AWW19 9i`g--n#re of Notary
SEAL:
My Commission expires: 041,ou
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This instrument was acknowledged before me on S - -,)-4 , 20
Stephen K. Izzo, President of ZONATHERM. /T- -
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