R-09-26 Authorizing the Execution of Agreements for Refunding Series 2015A and 2015B and Issuance of General Obligation Bonds9 - C) -"�(0
418 Main Street I Lemont, IL 60439
TO: Village Board Meeting
FROM: Darshana Prakash
THROUGH: George Schafer, Village Administrator
SUBJECT: A Resolution Authorizing the Execution of Agreements for Refunding
Series 2015A and 2015B and Issuance of General Obligation Bonds
DATE: February 23, 2026
SUMMARY/BACKGROUND
The refunding of Bond Series 2015A and 2015B was discussed at the February 16 Committee
of the Whole meeting, at which time the Board agreed to proceed with the process. To initiate
the refunding, the Village must execute two agreements for underwriting and for bond and
disclosure services.
The attached resolution authorizes (1) a contract with Bernardi Securities for underwriting
services and (2) a contract with Miller Canfield for bond and disclosure services.
The Village has maintained a longstanding relationship with Bernardi Securities in connection
with prior refundings and bond issuances. The Village has also previously worked with James
Snyder of Miller Canfield, who was formerly with Ice Miller. Most recently, Miller Canfield
assisted the Village with two IEPA loan applications.
As presented at the Committee of the Whole meeting, interest rates on short-term General
Obligation bonds remain favorable. It is advisable to take advantage of current market
conditions through the advanced refunding and calling of bonds to achieve net present value
savings. The Village will continue to adhere to its Debt Management Policy, which requires
that a minimum net present value debt service savings of 3% be achieved in order to proceed
with a refunding.
ANALYSIS
Consistency with Village Policy
STAFF RECOMMENDATION
Approve the Resolution
BOARD ACTION REQUESTED
Approve the Resolution
ATTACHMENTS
Resolution Authorizing Execution of Agreements with MillerCanfield and Bernardi FINAL.pdf
VILLAGE OF LEMONT
RESOLUTION
NUMBER R- q -26
A RESOLUTION AUTHORIZING THE EXECUTION OF AGREEMENTS FOR
UNDERWRITING SERVICES AND FOR BOND AND DISCLOSURE SERVICES IN
CONNECTION WITH THE REFUNDING OF BOND SERIES 2015A AND
SERIES 2015B AND ISSUANCE OF GENERAL OBLIGATION BONDS
JOHN EGOFSKE, Village President
CHARLENE M. SMOLLEN, Clerk
SAMUEL J. FORZLEY
JANELLE KITTRIDGE
KEN MCCLAFFER TY
KEVIN SHA UGHNESSY
RICK SNIEGOWSKI
RON STAPLETON
Trustees
Published in pamphlet form by authority of the Village President and Board of Trustees of the Village of Lemont on
RESOLUTION NO. R- -26
A RESOLUTION AUTHORIZING THE EXECUTION OF AGREEMENTS FOR
UNDERWRITING SERVICES AND FOR BOND AND DISCLOSURE SERVICES IN
CONNECTION WITH THE REFUNDING OF BOND SERIES 2015A AND
SERIES 2015B AND ISSUANCE OF GENERAL OBLIGATION BONDS
WHEREAS, the Village of Lemont, Counties of Cook, Will, and DuPage, Illinois ("Village"),
has determined that it is advisable and in the best interests of the Village to refund Series 2015A
and Series 2015B outstanding General Obligation Bonds and to issue new General Obligation
Bonds for the purpose of achieving debt service savings and managing the Village's outstanding
indebtedness; and
WHEREAS, in connection with the refunding of Series 2015A and Series 2015B bonds and
issuance of General Obligation Bonds, the Village must retain the services of an underwriter and
bond and disclosure counsel; and
WHEREAS, the Village has maintained a longstanding professional relationship with Bernardi
Securities, Inc. in connection with prior bond issuances and refundings and desires to retain
Bernardi Securities, Inc. to provide underwriting services for the proposed bond refunding and
issuance; and
WHEREAS, the Village has previously worked with Miller, Canfield, Paddock and Stone,
P.L.C. in connection with municipal finance matters and desires to retain Miller, Canfield,
Paddock and Stone, P.L.C. to provide bond counsel and disclosure services for the proposed
bond refunding and issuance; and
WHEREAS, the President and Board of Trustees find that it is in the best interests of the Village
to authorize the execution of agreements with Bernardi Securities, Inc. for underwriting services
and with Miller, Canfield, Paddock and Stone, P.L.C. for bond and disclosure services in
connection with the refunding and issuance of General Obligation Bonds.
NOW, THEREFORE, BE IT RESOLVED by the President and Board of Trustees of the
Village of Lemont, Counties of Cook, Will, and DuPage, Illinois, as follows:
SECTION 1:
The Village Administrator is hereby authorized and directed to execute an agreement with
Bernardi Securities, Inc. for underwriting services in connection with the refunding of Series
2015A and Series 2015B bonds and issuance of General Obligation Bonds (Exhibit A), subject
to final legal review and approval by the Village Attorney.
SECTION 2:
The Village Administrator is hereby authorized and directed to execute an agreement with
Miller, Canfield, Paddock and Stone, P.L.C. for bond counsel and disclosure services in
connection with the refunding of Series 2015A and Series 2015B bonds and issuance of General
Obligation Bonds (Exhibit B), subject to final legal review and approval by the Village Attorney.
SECTION 3:
The Village Administrator is authorized to take all actions necessary to carry out the intent of
this Resolution and to execute such additional documents as may be necessary to effectuate the
refunding and issuance of the General Obligation Bonds.
SECTION 4:
This Resolution shall be in full force and effect from and after its passage and approval as
provided by law.
PASSED AND APPROVED BY THE PRESIDENT AND BOARD OF TRUSTEES OF
THE VILLAGE OF LEMONT, COUNTIES OF COOK, WILL, AND DUPAGE,
ILLINOIS, ON THIS 23rd DAY OF FEBRUARY, 2026.
PRESIDENT AND VILLAGE BOARD MEMBERS:
Samuel J. Forzley
Janelle Kittridge
Ken McClafferty
Kevin Shaughnessy
Rick Sniegowski
Ron Stapleton
Attest:
AYES: NAYS:
l/
V"
Charlene M. Smollen, Village Clerk
ABSENT: ABSTAIN:
ohn Egofske, Village President
BER.NARDIS A(.1lJ1 jLr �J�J;:_ EXHIBITA
MUN ICIPAL BOND SPECIALISTS
Mayor John Egofske
Village of Lemont
418 Main Street
Lemont, Illinois 60439
February 23, 2026
Dear Mayor Egofske,
Bernardi Securities, Inc., acting as Underwriter (the "Underwriter"), anticipates structuring and
underwriting General Obligation Refunding Bonds (Alternate Revenue Source), Series 2026A (the
"Series 2026A Bonds") and General Obligation Refunding Bonds (Alternate Revenue Source),
Series 2026B (the "Series 2026B Bonds" and, together with the Series 2026A Bonds, the "Bonds")
on behalf of the Village of Lemont, Cook, DuPage and Will Counties, Illinois (the "Issuer"). The
purpose of the Series 2026A Bonds is to (i) refund the Village's outstanding General Obligation
Bonds (Alternate Revenue Source), Series 2015A, and (ii) paying for the costs of issuance of the
Bonds. The purpose of the Series 2026B Bonds is to (i) refund the Village's outstanding General
Obligation Bonds (Alternate Revenue Source), Series 2015B, and (ii) paying for the costs of
issuance of the Bonds.
This contract serves as the Underwriter's authorization to structure and underwrite the Bonds in
connection with a public offering of the Bonds. Included in this letter are the disclosures required
by Municipal Securities Rulemaking Board (MSRB) Rule G-17 regarding our role, duties and
interests as Underwriter of the Bonds.
Your execution of this letter will confirm that Bernardi Securities, Inc. ("Bernardi Securities") will
serve as Underwriter of the Bonds, and will enable us to provide advice with respect to the
structure, timing, terms, and other similar matters concerning the Bonds pursuant to the
underwriter exclusion under the municipal advisor registration rules of the U.S. Securities and
Exchange Commission.
At such time as the Issuer has approved all of the documents and proceedings related to the
issuance of the Bonds, the Underwriter will be expected to submit a detailed bond purchase
agreement to the Issuer for execution that includes, among other things, final interest rates, dated
date, principal maturity dates, interest payment dates, and other closing documents for issuing the
Bonds.
All costs of issuance are to be paid from Bond proceeds and, as applicable, other funds. These
costs include but are not limited to: legal fees (Issuer's Counsel, Bond Counsel and Disclosure
Counsel), trustee fees, if any, paying agent/bond registrar fees, book -entry setup charges, closing
costs, escrow verification fees, if any, escrow agent fees, if any, CUSIP costs, and any rating and
bond insurance fees. Bernardi's underwriting fee shall not exceed 1.00% of the proceeds of the
Bonds.
As with any Bond issue, your obligation to pay principal and interest will be an obligation that will
require you to make these payments no matter what budget constraints you encounter.
423 Central Avenue - Northfield, Illinois 60093 - p. 312-726-7324
Member FINRA / Member SIPC
EXHIBIT A
Furthermore, to the extent that you agree in the Bond issue to rate covenants, additional bond tests
or other financial covenants, these may constrain your ability to operate and to issue additional
debt and, if you do not comply with these covenants, they can result in a failure to perform with
respect to the Bond issue.
If the Bonds are issued as tax-exempt or tax -advantaged obligations, this requires that you comply
with various federal tax law requirements and restrictions relating to how you use and invest the
proceeds of the Bonds, how you use any facilities constructed or improved with proceeds of the
Bonds and other restrictions throughout the term of the Bonds. These requirements and restrictions
may constrain how you operate the financed facilities and may preclude you from capitalizing on
certain opportunities. Further, violation of these requirements and restrictions can result in a loss
of the tax-exempt or tax -advantaged status of the Bonds and may cause you to become liable to
the Internal Revenue Service and to the owners of the Bonds. In addition, in the event of an audit
of the Bonds by the IRS, obtaining an independent review of IRS positions with which you
legitimately disagree is difficult and may not be practicable.
The designation of Bernardi Securities as underwriter applies solely to this issue. We encourage
you to consult with your own legal, accounting, tax, financial and other advisors, as applicable, to
the extent you deem appropriate.
MSRB Rule G-17 Disclosures
Certain disclosures relating to the Bonds are required by MSRB Rule G-17 as set forth in MSRB
Notice 2019-20 (Nov. 8, 2019). The following MSRB Rule G-17 conflict of interest disclosures
are broken into three types including: (1) dealer -specific conflicts of interests disclosures (if
applicable); (2) transaction -specific disclosures (if applicable); and (3) standard disclosures.
1. Dealer -Specific Conflicts of Interest Disclosures:
Bernardi Securities is a full service securities firm and as such Bernardi Securities and its
affiliates may from time to time provide brokerage and other services and products to
municipalities, other institutions, and individuals, including the Issuer, certain Issuer
officials and employees, and potential purchasers of the Bonds. If these services are
rendered, Bernardi Securities may receive customary compensation, however, such
services are not related to the proposed offering of the Bonds.
In the ordinary course of fixed income trading business, Bernardi Securities may purchase,
sell, or hold a broad array of investments and may actively trade securities and other
financial instruments, including the Bonds and other municipal bonds, for its own account
and for the accounts of customers, including its employees and their family members,
where Bernardi Securities may receive a mark-up or mark-down. Such investments and
trading activities may involve or relate to the offering or other assets, securities and/or
instruments of the Issuer and/or persons and entities with relationships with the Issuer.
Bernardi Securities has not identified any additional potential or actual material conflicts
that require disclosure to you. If potential or actual conflicts arise in the future, we will
provide you with supplemental disclosures about them.
EXHIBIT A
2. Transaction Specific Disclosures
Disclosures Concerning Complex Municipal Securities Financing:
o We have not recommended a financing structure to you that may be a
"complex municipal securities financing" for purposes of MSRB Rule G-17.
However, we have attached a general description of the financial
characteristics and security structures of fixed rate municipal bonds, as well as
a general description of certain financial risks that are known to us and
reasonably foreseeable at this time and that the Issuer should consider before
issuing the Bonds.
3. Standard Disclosures
• Disclosures Concerning the Underwriter's Role:
o MSRB Rule G-17 requires us to deal fairly at all times with both municipal
issuers and investors. Bernardi Securities will maintain integrity in the
municipal securities market by adhering to the highest ethical standards. All
gifts & gratuities will be directed to and from Bernardi Securities and no
payments will be directed to a registered representative directly. All gifts to or
from an issuer will be limited to $100 annually. An exception from the $100
annual limit is allowed for "normal business dealings" which includes
reasonable entertainment hosted by Bernardi Securities where Bernardi
Securities or a representative of Bernardi Securities will accompany the
issuer. A registered principal of Bernardi Securities will review and approved
all gifts and entertainment prior to ensure they may not be deemed excessive
or lavish.
o Bernardi Securities will only serve as an underwriter. As Underwriter, our
primary role is to purchase the Bonds with a view to distribution in an arm's
length commercial transaction with the Issuer. It is important for you to
understand that, in this role, Bernardi Securities has financial and other
interests that differ from yours.
o The Issuer has not requested and does not request a dedicated retail order
period. Bernardi Securities will follow any retail order period as agreed upon
with the issuer. If Bernardi Securities would like to allocate securities in a way
that is inconsistent with the agreed upon retail order period requirements,
Bernardi Securities must obtain prior written consent from the issuer. If the
firm has agreed to underwrite a transaction with a retail order period, Bernardi
Securities will take reasonable measures to ensure that retail clients are bona
fide.
o Unlike a municipal advisor, as an Underwriter, we do not have a fiduciary duty
to the Issuer under the federal securities laws and, therefore, are not required
by federal law to act in the best interests of the Issuer without regard to our
EXHIBIT A
own financial or other interests. At the Issuer's request, Bernardi Securities
may provide incidental services, including advice as to the structure, timing,
terms and other matters concerning the issuance of the Bonds. Please note the
Bernardi Securities would be providing such services only in its capacity as an
Underwriter and not as a municipal advisor to the Issuer.
o You may choose to engage the services of a municipal advisor with a fiduciary
obligation to represent the Issuer's interest in this transaction.
o Our duty to purchase the Bonds from you at fair and reasonable prices is
balanced with our duty to sell the Bonds to investors at fair and reasonable
prices.
o We will review the Issuer's official statement for the Bonds in accordance
with, and as part of, our responsibilities to investors under federal securities
laws, as applied to the facts and circumstances of this transaction. The review
of the official statement by the Underwriter is solely for purposes of satisfying
the Underwriter's obligations under the federal securities laws and such review
should not be construed by the Issuer as a guarantee of the accuracy or
completeness of the information in the Official Statement.
Disclosures Concerning Underwriter's Compensation:
o Bernardi Securities will be compensated by an underwriting fee, the exact
amount of which will be set forth in the bond purchase agreement to be
negotiated and entered into in connection with the issuance of the Bonds.
Payment or receipt of the underwriting fee will be contingent on the closing of
the transaction and as set forth above, the amount of the fee will be based on a
percentage of the principal amount of the Bonds and premium, if applicable.
While this form of compensation is customary in the municipal securities
market, it presents a conflict of interest since Bernardi Securities may have an
incentive to recommend to you a transaction that is unnecessary or to
recommend that the size of the transaction is larger than is necessary.
Accompanying this letter is a risk disclosure document describing financial characteristics and
security structures of fixed rate municipal bonds as wells as a general description of certain
financial risks.
If there is any aspect of the foregoing disclosures that requires further clarification, please do not
hesitate to contact us. We understand that you have the authority to bind the Issuer by contract
with us, and that you are not a party to any conflict of interest relating to the proposed Bond
offering.
The Issuer understands the primary contact for this process will be Robert P. Vail.
EXHIBIT A
Please indicate your acknowledgement and acceptance of the foregoing matters and return an
executed copy of this letter to us. We look forward to working with you on this transaction.
BERNARDI SECURITIES, INC
By:
Name: Robert P. Vail
Title: Senior Vice President
ACCEPTED BY:
Village of Lemont, Cook, Du ge and Will Counties, Illinois
Signature:
Name:
Title: �� i
BFRNARDIS IJc t) t r ri i1�1�J � EXHIBIT A
11 C N ICI PAL BOND SPECIALISTS
Village of Lemont, Cook, DuPage and Will Counties, Illinois
General Obligation Refunding Bonds (Alternate Revenue Source), Series 2026A
and
General Obligation Refunding Bonds (Alternate Revenue Source), Series 2026B
February 23, 2026
RISK DISCLOSURES PURSUANT TO MSRB RULE G-17
FIXED RATE BONDS
(THAT ARE NOT "COMPLEX MUNICIPAL SECURITIES FINANCINGS")
The following is a general description of the financial characteristics and security structures
of fixed rate municipal bonds ( "Fixed Rate Bonds"), as well as a general description of certain
financial risks that are known to us and reasonably foreseeable at this time and that you should
consider before deciding whether to issue Fixed Rate Bonds. If you have any questions or concerns
about these disclosures, please make those questions or concerns known immediately to us. In
addition, you should consult with your financial and/or municipal, legal, accounting, tax and other
advisors, as applicable, to the extent you deem appropriate.
FINANCIAL CHARACTERISTICS
Maturity and Interest. Fixed Rate Bonds are interest -bearing debt securities issued by
state and local governments, political subdivisions and agencies and authorities, whether for their
benefit or as a conduit issuer for a nongovernmental entity. Maturity dates for Fixed Rate Bonds
are fixed at the time of issuance and may include serial maturities (specified principal amounts are
payable on the same date in each year until final maturity) or one or more term maturities (specified
principal amounts are payable on each term maturity date) or a combination of serial and term
maturities. The final maturity date typically will range between 10 and 30 years from the date of
issuance. Interest on the Fixed Rate Bonds typically is paid semiannually at a stated fixed rate or
rates for each maturity date.
Redemption. Fixed Rate Bonds may be subject to optional redemption, which allows you,
at your option, to redeem some or all of the bonds on a date prior to scheduled maturity, such as
in connection with the issuance of refunding bonds to take advantage of lower interest rates. Fixed
Rate Bonds will be subject to optional redemption only after the passage of a specified period of
423 Central Avenue - Northfield, Illinois 60093 - p. 312-726-7324
Member FINRA / Member SIPC
EXHIBIT A
time, often approximately ten years from the date of issuance, and upon payment of the redemption
price set forth in the bonds, which may include a redemption premium. You will be required to
send out a notice of optional redemption to the holders of the bonds, usually not less than 30 days
prior to the redemption date. Fixed Rate Bonds with term maturity dates also may be subject to
mandatory sinking fund redemption, which requires you to redeem specified principal amounts of
the bonds annually in advance of the term maturity date. The mandatory sinking fund redemption
price is 100% of the principal amount of the bonds to be redeemed.
SECURITY
Payment of principal of and interest on a municipal security, including Fixed Rate Bonds,
may be backed by various types of pledges and forms of security, some of which are described
below. The description below regarding "Security" is only a brief summary of certain possible
security provisions for the bonds and is not intended as legal advice. You should consult with your
bond counsel for further information regarding the security for the bonds.
General Obligation Bonds. "General obligation bonds" are debt securities to which your
full faith and credit is pledged to pay principal and interest. If you have taxing power, generally
you will pledge to use your ad valorem (property) taxing power to pay principal and interest. All
taxable property in the taxing body is subject to the levy of taxes to pay the same without limitation
as to rate or amount. The term "limited" tax is used when a limit exists as to the amount of the tax
(see below).
General obligation bonds constitute a debt and, depending on applicable state law, may
require that you obtain approval by voters prior to issuance. In the event of default in required
payments of interest or principal, the holders of general obligation bonds have certain rights under
state law to compel you to impose a tax levy.
Limited Bonds. Taxing bodies, subject to the Property Tax Extension Limitation Law of
the State of Illinois, as amended (the "Extension Limitation Law"), can. issue limited bonds.
Limited bonds are issued in lieu of general obligation bonds that otherwise have been authorized
by applicable law. They are payable from a separate property tax levy that is unlimited as to rate,
but the amount of taxes that will be extended to pay the bonds is limited by the Extension
Limitation Law. Limited bonds are payable from your debt service extension base (the "Base"),
which is an amount equal to that portion of the extension for the applicable levy year for the
payment of non -referendum bonds (other than alternate bonds or refunding bonds issued to refund
bonds initially issued pursuant to referendum), increased each year, beginning with the 2009 levy
year, by the lesser of 5% or the percentage in the Consumer Price Index for All Urban Consumers
(as defined in the Extension Limitation Law) during the 12-month calendar year preceding the
levy year. The Limitation Law further provides that the annual amount of taxes to be extended to
pay the limited bonds and all other limited bonds heretofore and hereafter issued by you shall not
exceed the Base less the amount extended to pay certain other non -referendum bonds heretofore
and hereafter issued by you and bonds issued to refund such bonds.
-2-
EXHIBIT A
Limited bonds constitute a debt. In the event of default in required payments of interest or
principal, the holders of limited bonds have certain rights under state law to compel you to impose
a tax levy (limited as set forth in the previous paragraph).
Alternate Bonds. Section 15 of the Local Government Debt Reform Act of the State of
Illinois, as amended (the "Debt Reform Act"), permits you to issue alternate or "double-barrelled"
bonds. Alternate bonds are general obligation bonds payable from enterprise revenues or from a
revenue source, or both, with your general obligation acting as backup security for the bonds.
Once issued, and until paid or defeased, alternate bonds are a general obligation, for the payment
of which you pledge your full faith and credit. Such bonds are payable from the levy of ad valorem
property taxes upon all taxable property in your taxing body without limitation as to rate or amount.
The intent of the Debt Reform Act is for the enterprise revenues or the revenue source to be
sufficient to pay the debt service on the alternate bonds so that taxes need not be levied, or, if
levied, need not be extended, for such payment.
The Debt Reform Act prescribes several conditions that must be met before alternate bonds
may be issued. First, alternate bonds must be issued for a lawful corporate purpose. If issued in
lieu of revenue bonds (as described below), then the revenue bonds must have been authorized
under applicable law (including satisfying any backdoor referendum requirements) and the
alternate bonds must be issued for the purpose for which the revenue bonds were authorized. If
issued payable from a revenue source limited in its purposes or applications, then the alternate
bonds must be issued only for such limited purposes or applications.
Second, alternate bonds are subject to a backdoor referendum. The issuance of alternate
bonds must be submitted to referendum if, within 30 days after publication of the authorizing
ordinance and notice of intent to issue the alternate bonds, a petition is filed. The petition must be
signed by the greater of (i) 7.5% of your registered voters or (ii) the lesser of 200 of the registered
voters or 15% of the registered voters, asking that the issuance of the alternate bonds be submitted
to referendum. Backdoor referendum proceedings for revenue bonds and for alternate bonds to be
issued in lieu of revenue bonds may be conducted at the same time.
Notwithstanding the previous paragraph, in governmental units with fewer than 500,000
inhabitants that propose to issue alternate bonds payable solely from enterprise revenues, except
for alternate bonds that finance or refinance projects concerning public utilities, public streets and
roads or public safety facilities and related infrastructure and equipment, if no petition is filed
within 45 days of publication of the authorizing ordinance and notice, the alternate bonds may be
issued. For purposes of this paragraph, the required number of petitioners for a governmental unit
with more than 4,000 registered voters is the lesser of (i) 5% of the registered voters or (ii) 5,000
registered voters and the required number of petitioners for a governmental unit with 4,000 or
fewer registered voters is the lesser of (i) 15% of the registered voters or (ii) 200 registered voters.
Third, you must demonstrate that the enterprise revenues are, or that the revenue source is,
sufficient to meet the requirements of the Debt Reform Act. If enterprise revenues are pledged as
security for the alternate bonds, you must demonstrate that such revenues are sufficient in each
year to pay all of the following:
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EXHIBIT A
(a) costs of operation and maintenance of the utility or enterprise, excluding
depreciation;
(b) debt service on all outstanding revenue bonds payable from such enterprise
revenues;
(c) all amounts required to meet any fund or account requirements with respect to such
outstanding revenue bonds;
(d) other contractual or tort liability obligations, if any, payable from such enterprise
revenues; and
(e) in each year, an amount not less than 1.25 times debt service on all:
(i) outstanding alternate bonds payable from such enterprise revenues; and
(ii) the alternate bonds proposed to be issued.
If one or more revenue sources are pledged as security for the alternate bonds, you must
demonstrate that such revenue sources are sufficient in each year to provide not less than 1.25
times (1.10 times if the revenue source is a government revenue source) debt service on all
outstanding alternate bonds payable from such revenue source and on the alternate bonds proposed
to be issued. You need not meet the test described in this paragraph for the amount of debt service
set aside at closing from bond proceeds or other moneys.
The determination of the sufficiency of enterprise revenues or revenue source or sources,
as applicable, must be supported by reference to the most recent audit of the governmental unit,
which must be for a fiscal year ending not earlier than 18 months previous to the time of issuance
of the alternate bonds. If such audit does not adequately show such enterprise revenues or revenue
source, as applicable, or if such enterprise revenues or revenue source, as applicable, are shown to
be insufficient, then the determination of sufficiency must be supported by the report of an
independent accountant or feasibility analyst, the latter having a national reputation for expertise
in such matters, who is not otherwise involved in the project being financed or refinanced with the
proceeds of the alternate bonds, demonstrating the sufficiency of such revenues and explaining, if
appropriate, by what means the revenues will be greater than as shown in the audit.
Alternate bonds may be issued to refund alternate bonds without meeting any of the
conditions set forth above if the term of the refunding bonds is not longer than the term of the
refunded bonds and that the debt service payable in any year on the refunding bonds does not
exceed the debt service payable in such year on the refunded bonds.
Alternate bonds are not regarded or included in any computation of indebtedness for the
purpose of any statutory provision or limitation unless taxes, other than a designated revenue
source, are extended to pay the bonds. In the event taxes are extended, the amount of alternate
bonds then outstanding counts against your debt limit until your audit shows that the alternate
Is
EXHIBIT A
bonds have been paid from the pledged enterprise revenues or revenue source for a complete fiscal
year.
In the event of default in required payments of interest or principal, the holders of alternate
bonds have certain rights under state law to compel you to increase the pledged revenues or have
the tax levy extended for such payment.
Debt Certificates. You may issue "debt certificates" to evidence your payment obligation
under an installment contract or lease. Your governing body may provide for the treasurer,
comptroller, finance officer or other officer of the governing body charged with financial
administration to act as counterparty to the installment contract or lease, as nominee -seller or
lessor. The installment contract or lease is then executed by your authorized officer and is filed
with and executed by the nominee -seller or lessor. As contracts for the acquisition and
construction of the project to be financed are executed (the "Work Contracts"), the governing
body orders those Work Contracts to be filed with the nominee -seller or lessor. The nominee -
seller or lessor identifies the Work Contracts to the particular installment contract or lease. Such
identification permits the payment of the Work Contracts from the proceeds of the debt certificates.
Debt certificates are paid from your lawfully available funds. You are expected to agree
to annually budget/appropriate amounts to pay the principal of and interest on the debt certificates.
There is no separate levy available for the purpose of making such payments.
Debt certificates constitute a debt. In the event of default in required payments of interest
or principal, the holders of the debt certificates cannot compel you to impose a tax levy, but you
have promised the holders of the debt certificates that you will pay the debt certificates and they
can proceed to file suit to enforce such promise.
Special Service Area Bonds. When special services are provided to a particular contiguous
area within a municipality, in addition to the services generally provided throughout the
municipality, a municipality may create a special service area. The cost of the special services
may be paid from taxes levied upon the taxable real property within the area, and such taxes may
be levied in the special service area at a rate or amount sufficient to produce revenues required to
provide the special services.
Prior to the first levy of taxes in the special service area and prior to or within 60 days after
the adoption of the ordinance proposing the establishment of the special service area, you are
required to hold a public hearing and to publish and mail notice of such hearing. At the public
hearing, any interested person may file written objections or give oral statements with respect to
the establishment of the special service area and the levy of taxes therein. As a result of the hearing,
you may delete areas from the special service area as long as the remaining area is contiguous.
After the hearing, an ordinance establishing the special service area must be timely filed with the
county recorder and the county clerk.
Bonds secured by the full faith and credit of the special service area territory may be issued
for the purpose of providing special services. Such bonds are paid from the levy of taxes unlimited
as to rate or amount against the taxable real property in the special service area. The county clerk
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EXHIBIT A
will annually extend taxes against all of the taxable real property in the area in amounts sufficient
to pay the principal and interest on the bonds. Such bonds are exempt from the Extension
Limitation Law of the State of Illinois, as amended.
Prior to the issuance of special service area bonds, you must give published and mailed
notice and hold a hearing at which any interested person may file written objections, or be heard
orally, with respect to the issuance of the bonds. The questions of the creation of the special service
area, the levy of a tax on such area and the issuance of special service area bonds may all be
considered at the same hearing.
The creation of the special service area, the levy of a tax within the area and the issuance
of bonds for the provision of special services to the area are subject to a petition process. If, within
60 days after the public hearing, a petition signed by not less than 51 % of the electors residing
within the special service area and 51 % of the owners of record of land located within the special
service area is filed with the municipal clerk objecting to the creation of the special service area,
the levy of a tax or the issuance of bonds, then the area may not be created, the tax may not be
levied and the bonds may not be issued. If such a petition is filed, the subject matter of the petition
may not be proposed relative to any of the signatories within the next two years.
Special service area bonds do not constitute an indebtedness of the municipality, and no
exercise of your taxing power may be compelled on behalf of the special service area bondholders
other than the ad valorem property taxes to be extended on the taxable real property in the special
service area.
Revenue Bonds. "Revenue bonds" are debt securities that are payable only from a specific
source or sources of revenues. Revenue bonds are not a pledge of your fiill faith and credit and
you are obligated to pay principal and interest on your revenue bonds only from the revenue
source(s) specifically pledged to the bonds. Revenue bonds do not permit the bondholders to
compel you to impose a tax levy for payment of debt service. Pledged revenues may be derived
from operation of the financed project or system, grants or excise or other specified taxes.
Generally, subject to state law or local charter requirements, you are not required to obtain voter
approval prior to issuance of revenue bonds. Revenue bonds may, however, be subject to a
backdoor referendum. If the specified source(s) of revenue become inadequate, a default in
payment of principal or interest may occur. Various types of pledges of revenue may be used to
secure interest and principal payments on revenue bonds. The nature of these pledges may differ
widely based on state law, the type of issuer, the type of revenue stream and other factors.
Some revenue bonds (conduit revenue bonds), may be issued by a governmental issuer
acting as a conduit for the benefit of a private sector entity or a 501(c)(3) organization (the obligor).
Conduit revenue bonds commonly are issued for not -for -profit hospitals, educational institutions,
single and multi -family housing, airports, industrial or economic development projects, and
student loan programs, among other obligors. Principal and interest on conduit revenue bonds
normally are paid exclusively from revenues pledged by the obligor. Unless otherwise specified
under the terms of the bonds, you are not required to make payments of principal or interest if the
obligor defaults.
I on
EXHIBIT A
Tax Increment Financing. Tax increment financing provides a means for municipalities,
after the approval of a "redevelopment plan and project," to redevelop blighted, conservation or
industrial park conservation areas. The Tax Increment Allocation Redevelopment Act of the State
of Illinois, as amended, allows incremental property taxes to be used to pay certain redevelopment
project costs and to pay debt service with respect to tax increment bonds issued to pay
redevelopment project costs. The municipality is authorized to issue tax increment bonds payable
from, and secured by, incremental property tax revenues expected to be generated in the
redevelopment project area. Incremental property tax revenues are derived from the increase in
the current equalized assessed valuation of the real property within the redevelopment project area
over and above the certified initial equalized assessed valuation for such redevelopment project
area.
Before adopting the necessary ordinances to designate a redevelopment project area, a
municipality must hold a public hearing and convene a joint review board to consider the proposal.
At the public hearing, any interested person or taxing district may file written objections and may
give oral statements with respect to the proposed financing. After the municipality has considered
all comments made by the public and the joint review board, it may adopt the necessary ordinances
to designate a redevelopment project area.
Tax increment bonds may be secured by the frill faith and credit of the municipality. The
issuance of general obligation tax increment bonds is subject to a "backdoor," rather than a direct,
referendum. Once a municipality has authorized the issuance of tax increment obligations secured
by its full faith and credit, the ordinance authorizing the issuance must be published in a newspaper
of general circulation in the municipality. In response, voters may petition to request that the
question of issuing obligations using the frill faith and credit of the municipality as security to pay
for redevelopment project costs be submitted to the electors of the municipality. If, within 30 days
after the publication, 10% of the registered voters of the municipality sign such a petition, the
question of whether to issue tax increment bonds secured by the municipality's frill faith and credit
must be approved by the voters pursuant to referendum. Such bonds are not exempt from the
Extension Limitation Law unless first approved at referendum.
Tax increment revenues may also be treated as a "revenue source" and be pledged to the
payment of alternate bonds under Section 15 of the Debt Reform Act.
FINANCIAL RISK CONSIDERATIONS
Certain risks may arise in connection with your issuance of Fixed Rate Bonds, including
some or all of the following (generally, the obligor, rather than the issuer, will bear these risks for
conduit revenue bonds):
Issuer Default Risk. You may be in default if the funds pledged to secure your
bonds are not sufficient to pay debt service on the bonds when due. The consequences of
a default may be serious for you and, depending on applicable state law and the terms of
the authorizing documents, the holders of the bonds, the trustee and any credit support
provider may be able to exercise a range of available remedies against you. For example,
if the bonds are secured by a general obligation pledge, you may be ordered by a court to
-7-
EXHIBIT A
raise taxes. Other budgetary adjustments also may be necessary to enable you to provide
sufficient funds to pay debt service on the bonds. If the bonds are revenue bonds or
alternate bonds, you may be required to take steps to increase the available revenues that
are pledged as security for the bonds. A default may negatively impact your credit ratings
and may effectively limit your ability to publicly offer bonds or other securities at market
interest rate levels. Further, if you are unable to provide sufficient funds to remedy the
default, subject to applicable state law and the terms of the authorizing documents, you
may find it necessary to consider available alternatives under state law, including (for some
issuers) state -mandated receivership or bankruptcy. A default also may occur if you are
unable to comply with covenants or other provisions agreed to in connection with the
issuance of the bonds.
This description is only a summary of issues relating to defaults and is not intended
as legal advice. You should consult with your bond counsel for further information
regarding defaults and remedies.
Redemption Risk. Your ability to redeem the bonds prior to maturity may be
limited, depending on the terms of any optional redemption provisions. If interest rates
decline, you may be unable to take advantage of the lower interest rates to reduce debt
service.
Refinancing Risk. If your financing plan contemplates refinancing some or all of
the bonds at maturity (for example, if you have term maturities or if you choose a shorter
final maturity than might otherwise be permitted under the applicable federal tax rules),
market conditions or changes in law may limit or prevent you from refinancing those bonds
when required.
Reinvestment Risk. You may have proceeds from the issuance of the bonds
available to invest prior to the time that you are able to spend those proceeds for the
authorized purpose. Depending on market conditions, you may not be able to invest those
proceeds at or near the rate of interest that you are paying on the bonds, which is referred
to as "negative arbitrage."
Tax Compliance Risk. The issuance of tax-exempt bonds is subject to a number
of requirements under the United States Internal Revenue Code, as enforced by the Internal
Revenue Service (IRS). You must take certain steps and make certain representations prior
to the issuance of tax-exempt bonds. You also must covenant to take certain additional
actions after issuance of tax-exempt bonds. A breach of your representations or your
failure to comply with certain tax -related covenants may cause the interest on the bonds to
become taxable retroactively to the date of issuance of the bonds, which may result in an
increase in the interest rate that you pay on the bonds or the mandatory redemption of the
bonds. The IRS also may audit you or your bonds, in some cases on a random basis and
in other cases targeted to specific types of bond issues or tax concerns. If tax-exempt bonds
are declared taxable, or if you are subject to audit, the market price of your bonds may be
adversely affected. Further, your ability to issue other tax-exempt bonds also may be
limited.
EXHIBIT A
This description of tax compliance risks is not intended as legal advice and you
should consult with your bond counsel regarding tax implications of issuing the bonds.
Received and read by:
Signature:
Name:
Title:
Date:
0
EXHIBIT B
Founded in 1852
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Sidne Dav Miller
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WASHINGTON, D.C.
JAMES M. SNYDER
Miller, Canfield, Paddock and Stone, P.L.C.
CALIFORNIA
TEL +1.312.460.4227
227 W. Monroe Street, Suite 3600
CANADA
FAX +1.312.460.4201
Chicago, Illinois 60606
MEXICO
E-MAIL snyder@millercanfield.com
TEL (312) 460-4200
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FAX (312) 460-4201
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millercanfield.com
February 18, 2026
VIA EMAIL
Ms. Darshana Prakash
Finance Director
Village of Lemont
418 Main Street
Lemont, Illinois 60439
Re: Village of Lemont, Cook, DuPage and Will Counties, Illinois
General Obligation Refunding Bonds (ARS), Series 2026A and General
Obligation Refunding Bonds (ARS), Series 2026B (collectively, the "Bonds")
Dear Ms. Prakash:
We appreciate the opportunity to serve as bond and disclosure counsel in connection with
the issuance of the above -referenced Bonds by the Village of Lemont (the "Village"). We look
forward to the opportunity to work on this financing with you, your colleagues, and the entire
financing team. This engagement letter sets forth the scope of our services as bond and disclosure
counsel and the nature of our compensation.
Scope of'Engagement.
Bond counsel is engaged as a recognized expert whose primary responsibility is to render
an objective legal opinion with respect to the authorization and issuance of the Bonds. Our services
would include rendering opinions on the validity and enforceability of the Bonds and the
tax-exempt status of any Bonds issued on a tax-exempt basis.
Our customary approving and supplemental legal opinions with respect to the Bonds will
be executed and delivered by us in written form on the date the Bonds are issued and will be based
upon facts and law existing as of their dates. In rendering the opinions, we will rely upon the
certified proceedings and other certifications of public officials and by other persons furnished to
us without undertaking independent verification of the information contained in the proceedings
and certifications. As bond counsel, the Village is our client; therefore, all of our duties inherent
to the attorney -client relationship run to the Village, and we will vigorously represent the interests
of the Village. However, our representation of the Village does not alter our responsibility to
render objective opinions as bond counsel which are necessary for the marketing of the Bonds.
Upon delivery of our opinions and filing of IRS Form 8038-G, if applicable, our responsibilities
EXHIBIT B
MILLER, CANFIELD, PADDOCK AND STONE, P.L.C.
Ms. Darshana Prakash -2- February 18, 2026
as bond counsel will be concluded with respect to the Bonds. As is customary, we will prepare
digital versions of the transcript for the Bonds for the working group shortly after closing.
Our services will consist of advising the Village as to its legal obligations under state and
federal law applicable to the issuance of the Bonds (including but not limited to the Village's
disclosure obligations under federal securities law), preparing or reviewing all ordinances,
resolutions, notices, certificates, offering documents, closing documents (including the Village's
continuing disclosure undertaking) and related material necessary to authorize, issue and deliver
the Bonds and the opinions described above. When requested we will attend meetings with the
Village officials, the Village's municipal advisors (the "Municipal Advisors"), the purchaser(s) of
the Bonds (which may be a bank or financial institution directly purchasing for its own portfolio,
an underwriter purchasing the Bonds and offering them on the public market, or some combination
of the foregoing, collectively referred to herein as the "Purchaser"), the Purchaser's counsel, as
well as rating agencies and regulatory bodies when appropriate, to assist in explaining the structure
of the transaction and the nature of and security for the Bonds and for any other matters relating
to the proposed financing. We will provide tax disclosure language for the preliminary and final
official statements (the "Official Statements"), as applicable, and will assist the Village in the
preparation of the sections of the Official Statements for which it is responsible, including the
presentation of the Village information contained in any applicable appendix thereto. We will
prepare the bond forms and participate in the sale and delivery of the Bonds to handle legal matters
that may arise at those times. As mentioned previously, at the time the Bonds are delivered we will
deliver our opinions as to the validity of the Bonds.
We believe that the above services encompass the normal scope of bond counsel activities
in connection with the issuance of the Bonds. Our services as bond counsel do not include
activities outside of that norm, or the representation of the Village in litigation that might arise in
connection with the Bonds. Although we will, as described above, assist the Village in identifying
the nature of information appropriate for inclusion in the Official Statements, as applicable, assist
with the drafting of those documents and deliver a supplemental opinion, if applicable, we will
not, unless agreed to with the Village in writing, undertake "due diligence" with respect to the
Village's affairs or financial condition or render an opinion with respect to the completeness,
accuracy or fairness of the underlying information supplied by the Village to the Purchaser(s),
bondholders or rating agencies.
Our professional responsibilities as attorneys in this matter will be limited to interpretations
of law and other legal issues and the drafting of legal documents. Our engagement includes
providing advice with respect to business matters such as the terms or structure of the Bonds or
the means of generating fiends to pay debt service on the Bonds based solely upon our experience
with similar matters and without undertaking professional responsibility as attorneys for such
advice. In no event, of course, would we presume to assume the responsibilities of the Village or
the professional responsibilities of the Village's Municipal Advisors or any other advisor with
respect to such non -legal matters. We are not registered municipal advisors under the federal
Dodd -Frank Act.
EXHIBIT B
MILLER, CANFIELD, PADDOCK AND STONE, P.L.C.
Ms. Darshana Prakash -3- February 18, 2026
Disclosure counsel is engaged as counsel to the Village with respect to Illinois law and
federal law relating to disclosure requirements that pertain to governmental debt obligations,
whose primary responsibility will be to render objective legal opinions with respect to the issuance
of the Bonds by the Village and the Village's compliance with Rules 10(b)-5 and 15c2-12
promulgated by the Securities and Exchange Commission (the "Commission") pursuant to the
Securities Exchange Act of 1934. As disclosure counsel, we will examine applicable law, draft, or
review all required disclosure documents; review such other financing documents of the Village
and undertake such additional duties as we deem necessary to render such opinions. The above -
described services specifically include, but are not limited to, the following:
• Consult with Village officials and Village attorneys concerning disclosure requirements,
questions and issues relating to the issuance of the Bonds and concerning continuing
disclosure requirements.
• Attend, upon request, any meetings of the Village that pertain to the Village's issuance of
the Bonds.
• Review the Village's bond purchase agreement (the "Bond Purchase Agreement")
negotiated between the Village and Bernardi Securities, Inc. ("Bernardi"), the proposed
underwriter of the Bonds.
• Prepare and revise the Village's Official Statements in connection with the offerings of the
Bonds.
• Review and proof the printing, delivery and posting on EMMA of the Official Statements.
• Review all Bond documents prepared in connection with the issuance of the Bonds.
• Provide a written Rule 10(b)-5 and Rule 15c2-12 (the "Commission") disclosure opinion
to the Village at the times the Bonds are issued.
• Consult with Village officials regarding all matters relating to continuing disclosure
requirements that pertain to the Bonds, specifically to include those imposed by
Commission Rule 15c2-12.
• Consult with Village officials and staff concerning disclosure questions that may arise with
respect to the Bonds after issuance.
• Provide the Village such other legal services and advice with respect to the Bonds as are
traditionally provided by disclosure counsel.
Subject to the completion of proceedings to the Village's counsel's satisfaction, we will
render our opinions addressed to the Village and the Underwriter that will include, without
limitation, substantially the following:
EXHIBIT B
MILLER, CANFIELD, PADDOCK AND STONE, P.L.C.
Ms. Darshana Prakash -4- February 18, 2026
• in the course of preparation of the Official Statements, we participated in conferences with
certain officials and employees of, and counsel and consultants for, the Village. Our
discussions in the conferences and our review of the documents described in this letter did
not disclose to us any information which gives us reason to believe that the Official
Statement (except as to the financial and demographic information, engineering and
statistical data included in the Official Statements, and the information and statements
provided under the headings "BOOK -ENTRY ONLY SYSTEM" and "TAX
EXEMPTION" — in each case, if applicable — and in certain Appendices, (to be modified
as applicable) as to which we do not express any opinion) contains any untrue statement of
a material fact or omits to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which they were
made, not misleading; and
• the Continuing Disclosure Undertakings, together with the Official Statements, satisfy the
requirements contained in Rule 15c2-12(b)(5) promulgated by the Commission for the
issuance of the Bonds and for provision of the information at the times and in the manner
required by said rule.
The opinions will also address such other matters, if any, that are at the date of closing
normally included in the opinions of disclosure counsel for the Village and its bonds, or as may be
required pursuant to the Bond Purchase Agreement.
The opinions will be dated and executed and delivered by us in written form on the dates
the Bond are exchanged for their purchase price (the "Closing") and will be based on existing law
as of their respective dates. Upon the delivery of the opinions and the filing of all appropriate
closing documents, our responsibilities as disclosure counsel will be concluded with respect to the
issuance of the Bonds.
In rendering the opinions, we will rely upon the certified proceedings and other
certifications of public officials and other persons furnished to us without undertaking to verify
the same by independent investigation.
As disclosure counsel, we will not assume or undertake responsibility for the preparation
of any supplemental ordinances or any other nondisclosure document with respect to the Bonds
that is traditionally prepared by bond counsel. However, our responsibility will include the
preparation or review of any portion thereof that is necessary to render our disclosure counsel
opinions with respect to the Bonds.
In performing our services as disclosure counsel, we will serve as special counsel to the
Village, and we will represent its interests. We assume that other parties to the transaction will
retain such counsel as they deem necessary and appropriate to represent their interests in the
transaction. Our representation of the Village does not alter our responsibility to render an
objective opinion as disclosure counsel.
EXHIBIT B
MILLER, CANFIELD, PADDOCK AND STONE, P.L.C.
Ms. Darshana Prakash -5- February 18, 2026
We understand and agree that this is not an exclusive engagement, and the Village may
retain, as co -disclosure counsel, any other counsel of its choosing. Except as discussed above, we
recognize that we shall be disqualified from representing any other client (i) in any matter which
is substantially related to our representation of the Village as described herein and (ii) with respect
to any matter wherein confidential information furnished to us could be used to the Village's
material disadvantage. We are a relatively large law firm, and we represent many other
governmental entities, companies, and individuals. It is possible that some of our present or future
clients may have interests which conflict with the Village's in litigation, business transactions or
other legal matters during the time that we are representing the Village. Subject to the
requirements of the Illinois Rules of Professional Responsibility which govern us, we may in the
future consult with you about our continued representation or the undertaking of a new
representation of clients in any such matter that is not substantially related to our work for the
Village and does not risk potential use of confidential information to the Village's material
disadvantage.
Conflicts of Interest. We understand and agree that this is not an exclusive engagement,
and the Village may retain any other counsel of its choosing. We also understand that the Village
may be separately represented by its own counsel. Except as discussed above, we recognize that
we shall be disqualified from representing any other client (i) in any matter which is substantially
related to our representation of the Village as described herein and (ii) with respect to any matter
wherein confidential information furnished to us could be used to the Village's material
disadvantage. Please be aware of our client relationship with Bernardi in unrelated matters, to
which we understand the Village consents. We have requested Bernardi's consent to this
engagement. We are a relatively large law firm, and we represent many other governmental
entities, companies, and individuals. It is possible that some of our present or future clients may
have interests which conflict with the Village's in litigation, business transactions or other legal
matters during the time that we are representing the Village. Subject to the requirements of the
Illinois Rules of Professional Responsibility, we may in the future consult with you about our
continued representation or the undertaking of a new representation of clients in any such matter
that is not substantially related to our work for the Village and does not risk potential use of
confidential information to the Village's material disadvantage.
Fees. As is customary in these financings, we will render one statement for professional
services upon the closing of the issuance of the Bonds. The Village will compensate us for our
legal services as bond and disclosure counsel to the Village by the payment of a fixed fee for the
issuance of the Bonds to be agreed upon prior to the closing of the issuance of the Bonds. Such
fees will be payable as costs of issuance out of the proceeds of the sale of the Bonds.
Austin Root and Shelly Scinto will be the primary Miller Canfield attorneys working with
me in connection with this engagement. We welcome this opportunity to be of service to the
Village and look forward to working with you and the entire financing team.
Completion of Engagement. This engagement will terminate when we perform our last
services for you in this matter, whether or not the charges for those services have been invoiced or
EXHIBIT B
MILLER, CANFIELD, PADDOCK AND STONE, P.L.C.
Ms. Darshana Prakash -6- February 18, 2026
paid. Unless we are then representing the Village in another matter, the lawyer -client relationship
between us will terminate at the same time.
Standard Terms of Engagement. Attached to this letter is a copy of our Standard Terms
of Engagement, which are incorporated by reference into this letter, apply to and govern all
engagements undertaken by the firm, and are deemed for all purposes herein to have been accepted
upon your acceptance of our services. I encourage you to read this document carefully, as it is an
integral part of our agreement with you regarding this engagement and contains important
provisions that, along with this letter, govern our relationship.
If you have any questions about this engagement or any aspect of our work or charges, I
encourage you to contact me promptly.
Very truly yours,
Miller, Canfield, Paddock and Stone, P.L.C.
By:
James M. Snyder
/cme
The Village acknowledges its waiver regarding Bernardi Securities, Inc.
NOTE: The attached Standard Terms of Engagement contains a binding arbitration
provision. By executing this letter and agreeing to submit to arbitration, you acknowledge
that you have reviewed this provision and understand the scope of the provision along with
the advantages/disadvantages of agreeing to arbitration.
AGREED AND ACCEPTED:
VILLAGE OF LEMONT, ILLINOIS
By:
Its:
EXHIBIT B
MILLER, CANFIELD, PADDOCK AND STONE, P.L.C.
STANDARD TERMS OF ENGAGEMENT
Includes information provided in accordance with the Illinois Rules of Professional Conduct
This statement sets forth certain standard terms of our engagement as your lawyers in this matter. It supplements our
engagement letter with you and is an integral part of our agreement. Therefore, you should review this statement carefully and
contact us promptly if you have any questions. Unless modified in writing by mutual agreement, these terms and those in the
engagement letter will control our relationship. We suggest that you retain this statement and our engagement letter in your file.
Our engagement is also subject to and governed by the applicable rules of professional conduct.
How We Approach Our Work for You
We will perform our legal services for you in accordance with our professional judgment. Any expressions by us
concerning the outcome of your legal matters are expressions of that judgment but are not guarantees. Such advice is necessarily
limited by the facts that you and others disclose to us and the state of the law at the time our advice is expressed.
The person or entity we represent is the person or entity identified in our engagement letter, and the word "you" in this
statement means that person or entity only. Unless we agree with you in writing, our engagement does not include representation
of any affiliates of such person or entity. For example, if you are a corporation, a partnership, or a limited liability company, our
representation of you does not include representation of any parents, subsidiaries, employees, officers, directors, shareholders,
members or partners. If you are a trade association or other voluntary organization, our engagement does not include representing
any of your members. If you are an individual, our representation does not include your spouse or other family members. If you
believe this engagement includes additional entities or persons as our clients, you should inform us immediately and ask us to
include those persons in our engagement letter.
Our work depends on your cooperation. Thus, you agree that you will be truthful, will preserve all relevant evidence,
and will provide the firm with all information, records, documents, and personnel assistance as the firm deems necessary to perform
its work, particularly in matters that require timely responses from you in order to meet deadlines. You also agree to provide and
promptly update contact and other relevant information and to notify the firm of any corporate mergers or acquisitions that could
affect our ability or willingness to continue our representation of you.
Who Will Provide the Legal Services
Customarily, each client of the firm is served by a principal attorney contact. The principal attorney should be someone
in whom you have confidence and with whom you enjoy working. You are free to request a change of principal attorney at any
time. Subject to the supervisory role of the principal attorney, your work or parts of it may be performed by other lawyers and
legal assistants in the firm. Such delegation may be for the purpose of involving lawyers or legal assistants with special expertise
in a given area or for the purpose of providing services on the most efficient and timely basis.
How Our Fees Will Be Set
Generally, our fees are based on the time spent by the lawyers and paralegal personnel who work on your matter. We
will charge for all time spent performing professional services for you including, by way of illustration, telephone and office
conferences with you, your representatives, consultants, opposing counsel, and others; conferences among our legal and paralegal
personnel; factual investigation; legal research; drafting letters, agreements, pleadings, briefs, and other documents; responding to
requests by your auditors; and travel. We will keep accurate records of the time we devote to your work. If you have insurance
relating to the matter on which you have engaged us, and your insurance carrier pays less than the rates on which we have agreed
or declines to pay for any matter on which you have engaged us, you agree to pay the difference.
The hourly rates of our lawyers and legal assistants are reviewed and adjusted periodically on a firm -wide basis to reflect
current levels of legal experience, changes in overhead costs, and other factors. Because these changes are made on a firm -wide
basis, we customarily do not inform each client of the specific changes in the hourly rates of the personnel working on their matters.
However, the rates charged by our personnel will be reflected on the invoices we send you, and we encourage you to raise promptly
any questions you may have regarding our rates and any changes to them. Your responsibility to pay our fees is not conditioned
upon the firm achieving any particular result.
From time to time you may request and we may furnish estimates of legal fees and other charges that we anticipate will
be incurred in representing you. Due to a wide range of variables, many of which are unforeseeable, these estimates are by their
EXHIBIT B
nature inexact and cannot be considered as limitations on the fees we will charge. The actual fees and charges ultimately billed
may vary from such estimates.
With your advance written agreement, the fees ultimately charged may be based upon a number of factors, including:
the time and effort required, the novelty and complexity of the issues presented, the value of the services to you, the amount of
money or value of property involved, and the time constraints imposed by you and other circumstances, such as an emergency
closing or the need for injunctive relief from a court.
For certain well-defined services and special circumstances, we will, if requested, quote a flat fee. In all such situations,
both the amount of the fee and the scope of the services to be provided must be expressed in the engagement letter. In appropriate
circumstances, we may agree to provide legal services on a contingent fee basis. The terms of any contingent fee representation
must be set forth in the engagement letter.
Additional Charges
In addition to our fees, our invoices will include charges for expenses incurred in the performance of our legal services.
Generally, charges which reflect the use of resources provided by outside vendors (courier services, court reporters, etc.) are
charged at the vendor's charge to us without markup. Certain other charges reflect the utilization of firm resources or involve an
integral combination of firm's resources and outside vendors (photocopying, computer research, etc.). These services are charged
at standard rates which encompass both the direct vendor charge and an amount equal to the firm's estimate of an appropriate
charge for the firm resources allocated to the service. While these charges may not match the firm's exact cost of providing these
services in each instance, we believe that these charges are fair and generally comparable to the charges made by other firms for
similar services. The current basis for these charges is set forth below. The firm will review this schedule of charges on an annual
basis and adjust them to take into account changes in the firm's costs and other factors.
Photocopying: The firm charges $.10 per page.
Computer Research: The firm uses computer assisted research services such as Westlaw. We charge for computer
research at 90% of the retail rates published by the computer assisted research services. We believe that this charge compensates
the firm for providing support and ancillary services, yet provides these services to our clients at a discount from retail prices.
Mail: Clients are charged the actual cost of postage for the U.S. Postal Service and foreign postal carriers, as well as the
actual cost of air express couriers.
Overtime: Staff overtime is charged only when required by the time constraints of the specific project.
Facsimile: The firm reserves the right to charge up to $1.00 per page for outgoing faxes, which includes all telephone
costs. There is no charge for incoming faxes.
Telephone Calls: The firm does not charge for local or long-distance calls made or received at our office locations via
land line. In cases in which a substantial number of cellular telephone calls are required in an engagement, the firm may pass on
the cost of such calls charged to the subscriber.
Travel -Related Expenses: Airfare, meals, and related travel expenses are charged to you at the firm's actual, out-of-
pocket cost. Automobile mileage is charged at the IRS approved rate. Credits earned under the Frequent Flyer Programs accrue
to the individual traveler and not to the firm or you.
Firm Messengers: Walking messenger trips are charged at a flat rate per delivery. Driving messenger trips are charged
at the firm's standard automobile mileage charge plus parking and toll charges if imposed.
Other Costs: The firm charges actual disbursements for third -party services like court reporters, expert witnesses,
database services, and the like.
You are responsible for the payment of all fees and expenses charged by others (such as experts, investigators, consultants, court
reporters, etc.). Unless special arrangements are otherwise made, all invoices for third -party fees and expenses in excess of $1,000
will be forwarded to you for direct payment.
Use of Digital/Electronic Communication, Cloud, and Transcription Services
To provide you with efficient and convenient legal services, the firm will frequently communicate and transmit
documents using electronic mail (e-mail), secure digital file transfer, or other digital or electronic means. Because digital and
electronic communication continues to evolve, there may be risks communicating in this manner, including risks related to
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EXHIBIT B
confidentiality and security. You have considered these risks and have consented to our use of digital or electronic communication.
In addition, the firm may rely on cloud computing services with servers located in a facility other than our offices. If so, the firm's
electronic data, including emails and documents, will be stored in these servers. You understand and agree to having your
communications, documents, and other information stored via cloud -based services.
Our communications with you may include confidential information or personal data (including potentially sensitive
information). By enabling transcription features (such as those provided by Microsoft Teams, Zoom, or other third -party
platforms), you may affect the attorney -client privilege, work product privilege, or other protections afforded to this information.
Also, transcription services may produce incomplete, inaccurate, or misleading text or summaries that omit context or nuance. As
such, we will not enable these transcription features without your consent. Given these concerns, you agree that you will obtain our
consent before you enable transcription features in connection with conversations with us. You agree that any such transcripts that
you enable (with or without our consent) are for convenience only, do not constitute official minutes, commitments, or legal advice,
and do not reflect a complete and accurate record of the meeting. Also, you understand that if you transcribe your meetings with
us using such third -party platforms (or ask us to do the same), we cannot guarantee that any protections applicable to your
information will remain intact.
Generative Artificial Intelligence
During the course of this engagement, the firm may use generative artificial intelligence ("GenAl") to enhance and
streamline certain aspects of our services. Specifically, we may use this technology to aid in researching relevant legal issues,
drafting briefs, memoranda, agreements or other work product, and/or reviewing documents produced by you or other parties. If
we use GenAI to provide our services to you, it is because we believe that doing so is more efficient and cost-effective. Our lawyers
maintain oversight over GenAI-developed output. Like any technology, GenAI carries some degree of risk, which may include
errors in GenAI-developed content, data security vulnerabilities, and system malfunctions. We have implemented reasonable
measures to safeguard against these risks and to preserve the security of any confidential infonnation you provide us. By accepting
our services, you agree that the benefits of using GenAI outweigh these risks and consent to the use of GenAI in connection with
this engagement.
Electronically Stored Information
If it becomes necessary to collect, review or produce a collection of discovery or other matter -related information, you
expressly agree to compensate the firm for the additional costs incurred. Such information may be in hard copy form or
electronically stored ("ESI"). Such costs may include, but will not be limited to, forensic investigations, information collection,
hard copy document scanning, ESI processing, use of a hosted review/production platform, and encrypted storage devices (when
dictated by regulatory requirements).
In this digital age, we believe it is valuable to you to help manage some of these costs. Accordingly, we offer ESI
processing (the preparation of infonnation for review) and the use of an industry leading review/production platform at rates less
than that typically charged by third party vendors. The firm's current charge for ESI processing is up to $50.00 per gigabyte (GB)
for each collection of ESI submitted. The firm's current charge for use of a hosted review/production platforn can vary from $4.00
per GB to $50.00 per GB, per month (depending on the platform operation) and applies while the information remains on the
platform. The firm may also charge for client -approved external users' access to the platform at a pass -through rate of $200 per
user, per month as long as the external user has access to the platform. These charges may increase from time to time and if so,
the firm agrees to provide advanced notification of any increase.
Payment
Our billing rates are based on the assumption of prompt payment. Consequently, unless other arrangements are made,
fees for services and other charges will be billed monthly and are payable within thirty days of receipt. If you have not advised us
of objections within 30 days of the date of the invoice, the invoice will be deemed accepted and shall constitute an account stated
under applicable law. We reserve the right to charge interest at the maximum legally permissible rate up to 1 % per month or 12%
per annum on amounts past due. If you have provided the firm with a retainer, you agree that the retainer, or any client fiends that
we may hold for you (at our discretion), will be stored in our client trust account located in Michigan. Any retainer will either be
held in security for our final fees and expenses or the firm will draw against the retainer to satisfy monthly amounts owed by you.
To secure payment of the firm's fees and expenses and to induce the firm to provide and continue to provide legal
services, you grant the firm all general, possessory and retaining liens and special and charging liens permitted by law, including
liens on the files and property now or hereafter in the firm's possession and on any recovery obtained in connection with our
engagement. You specifically grant the furin a lien on any recovery obtained from any source whatsoever for or relating to any
claims asserted in litigation or in connection with the engagement, regardless of whether the recovery is the result of settlement,
mediation, arbitration, judgment, or otherwise. The liens granted shall survive termination of our agreement with you.
EXHIBIT B
Representation in Other Matters
We are a relatively large law firm and we represent many other companies and individuals. It is possible that, during the
time that we are representing you or afterward, the interests of another client of the firm may require the assertion in litigation,
business transactions, or other legal matters of positions which conflict with yours. This includes, but is not limited to, matters in
which we represent entities that are competing for, or seeking to obtain or enforce an interest in, a limited pool of resources (e.g.,
foreclosure of a mortgage or issuance of licenses). Additionally, subject to the requirements of the rules of professional conduct
which govern us, you agree that our representation of you in this matter will not disqualify the firm from opposing you in other
matters, including litigation or other dispute resolution proceedings, that are unrelated to the subject matter of this representation.
You waive any conflict of interest with respect to the assertion of positions and the undertaking of unrelated, but adverse,
representations described in the previous sentences. You also agree that we may disclose to prospective clients the general nature
of this engagement with you and the fact that you have acknowledged our ability to undertake engagements of the type described
above. We will not, of course, use to your disadvantage any proprietary or confidential information we acquire from you as a result
of our representation of you in this or other matters.
Attorney -Client Privilege
Sometimes in the course of our representation of clients, we confront ethical or other legal issues that require that we
seek the advice of an attorney, either one of our own attorneys or an attorney from another firm. As part of our agreement regarding
your representation by the firm, you consent to such discussions and agree that these discussions, whether they occur during or
after our engagement, are protected by the attorney -client privilege.
Termination of Engagement
Our engagement as your attorneys terminates upon our completion of the services you have retained us to perform,
whether or not our final invoice has been rendered or paid. If your matter involves the provision of advice and counsel in a certain
legal area on an as -needed basis and we have not provided you with any such services in a 12-month period, you agree that we may
close your matter and consider your engagement complete. If you later retain us to perform further or additional services, our
attorney -client relationship will begin again with the signing of a new engagement letter.
You may terminate our engagement with or without cause at any time on by notifying us of your decision to do so.
Termination of our services will not affect your responsibility to pay for services rendered and expenses and other charges incurred
up to the date when we receive notice of termination, and for any further work required of us in order to facilitate an orderly
turnover of matters in process at the time of termination.
We may terminate our engagement for any of the reasons permitted under the rules of professional conduct which govern
us, including: your failure to pay our invoices promptly, misrepresentation of (or failure to disclose) any material facts, action taken
contrary to our advice, or any other conduct or situation that in our judgment impairs an effective attorney -client relationship
between us or presents conflicts with our professional responsibilities. This includes conduct that, in our view, is abusive or
harasses firm personnel. Subject to the rules of professional conduct which govern us, we may also terminate our engagement by
reason of your failure to abide by your consent to our representation of a client in accordance with the terms of the section entitled
"Representation in Other Matters" above. If required, we will request a stipulation executed by you allowing us to withdraw as
attorney of record in any judicial, arbitration, or similar proceedings. We may also apply for a court order approving our withdrawal
from representing you, and you agree in advance to our withdrawal.
Subsequent Engagements
If, during this engagement or thereafter, you retain us for an additional engagement, it will be presumed, absent a written
agreement between us to the contrary, that the terms and conditions contained in this document will apply to such subsequent
engagements.
Entity Transparency Laws
Unless otherwise and expressly stated in the engagement letter, we are not being retained and our acceptance of an
engagement is not an undertaking to form or register any entity on the Client's behalf. Moreover, unless we otherwise and expressly
agree to do so in the written engagement letter, we are not responsible for providing the Client or any other person or entity with
any review, advice, or guidance in connection with the Corporate Transparency Act ("CTA"), the New York Limited Liability
Company Transparency Act, or any existing or later -adopted law of any other State or Indian tribal jurisdiction that requires the
submission of beneficial ownership or company applicant information similar in purpose or effect as the CTA (collectively, with
the CTA, "Entity Transparency Laws"). Nor do we agree to prepare, review, submit, update or correct any report or submission,
or to update or correct the beneficial owner, company applicant, or similar information for the Client or any other person or entity,
under any Entity Transparency Laws without a separate written engagement letter signed by an authorized representative of the
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EXHIBIT B
firm and the Client. These disclaimers apply even if our scope of engagement generally or specifically contemplates, or we are in
possession of or become aware of, facts or information that do or may result in changes in the Client's or any other person or
entity's beneficial owner(s), company applicant, or similar information.
Money Laundering and Notifications to Authorities
Laws or applicable regulators in many jurisdictions in which we operate require us to establish and utilize procedures
and processes to prevent money laundering. If we know or suspect (or have grounds to suspect) that a matter or transaction involves
money laundering, then we may, in accordance with our obligations under applicable statutes and regulations, be required to make
certain disclosures to the relevant regulatory authorities and/or notify them of our knowledge or suspicion. Depending on the
circumstances, we may not be able to, and will not, seek your consent to make any such disclosure or otherwise inform you that
we have made such a notification. We are not assuming, and do not accept, any liability for any loss or damage you may suffer by,
as a result of, or otherwise in connection with, any actions we take in good faith to comply with all applicable anti -money laundering
legislation or other statutory or regulatory obligations to which we may be subject. In connection with our duties to comply with
any anti -money laundering or other corporate due diligence requirements, we will charge you in accordance with the generally
applicable terms of our engagement. Your failure to comply with these requirements or to cooperate with or assist us with our
obligations under these requirements is grounds for us to terminate our relationship with you and to stop work on all matters we
are handling on your behalf.
Alternative Dispute Resolution: Mandatory Arbitration
Should any dispute arise concerning the services provided to you by us or the charges we make for those services and
related expenses, you and we shall first try in good faith to settle the dispute directly. If the dispute is not resolved, it shall be
submitted to third party neutral facilitation in accordance with the mediation rules of the American Arbitration Association. If the
dispute is not resolved through mediation, the dispute shall be settled by binding, private arbitration in accordance with the laws of
the State of Michigan. The arbitration shall be conducted in accordance with the Commercial Arbitration Rules of the American
Arbitration Association except as modified here and with the understanding that the American Arbitration Association will
designate, if requested, arbitrators who have experience with the claims at issue. Judgment upon the award rendered by the
arbitrators may be entered in any court of record having jurisdiction thereof. The mediation and arbitration proceedings, including
any hearings, shall be held in the Detroit metropolitan area. Both you and we agree that neither of us is entitled to or shall request
or claim punitive or exemplary damages and that the arbitrators shall not have the authority to award punitive or exemplary damages
or any other damages in excess of actual pecuniary damages.
By agreeing to participate in arbitration of any disputes regarding our services, you understand and agree that you are
waiving the right to a jury trial, the right to broad discovery, and the right to an appeal on the merits. You are agreeing to
confidentiality of proceedings and to share financial responsibility for the costs associated with the arbitration (including but not
limited to the arbitrator(s)' compensation and any administrative fees). The scope of this agreement includes any and all claims
and/or disputes arising from the services provided to you, including, but not limited to, fee disputes and claims of professional
negligence. However, nothing in this provision is intended to restrict your right to report unethical conduct. If you advise us in
writing that you do not agree to mandatory arbitration, you are not prohibited from agreeing to arbitrate in the future and
acknowledge that in certain circumstances, arbitration can be more efficient, expeditious, and inexpensive than courtroom litigation.
Notwithstanding the foregoing, the firm may, at its sole discretion, pursue collection of your unpaid fees, expenses or
other charges in any court of competent jurisdiction, and such collection actions shall not be subject to the mediation or arbitration
provisions set forth above. You are responsible for and agree to pay all fees and costs incurred by the firm in connection with such
collection actions, including but not limited to any attorneys' fees, court costs, and other expenses related to our efforts to collect
the unpaid amounts.
Client Documents
We will maintain any documents you furnish to us in our client file (or files) for this matter. At the conclusion of the
matter (or earlier, if appropriate), it is your obligation to advise us as to which, if any, of the documents in our files you wish us to
turn over to you. These documents will be delivered to you within a reasonable time after receipt of payment for outstanding fees
and costs. We will retain any remaining documents in our files for a certain period of time and ultimately destroy them in
accordance with our record retention program schedule then in effect.
We are not advising you with respect to this statement of the terms of our engagement. If you wish advice, you should
consult independent counsel of your choice.
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