Consent 1.I.
Regular City Council Meeting
- Meeting Date:
- 06/28/2010
- TITLE
- Downtown Revolving Loan Fund Loan Modification Requests for Babcock, LLC.
- PRESENTED BY:
- Patrick M Weber
- Department:
- City Hall Administration
Presentation:
PROBLEM/ISSUE STATEMENT
The Downtown Revolving Loan Committee met on June 8, 2010, and approved loan term modifications to the Babcock, LLC loan of $150,000.
Babcock, LLC is requesting a loan term modification from the Downtown Revolving Loan Fund to delay payment of the full amount due from June 1, 2010, to September 1, 2010, in order to allow time to secure other financing. The loan was initially approved by Council December 14, 2009, with loan terms requiring interest and principal payments calculated using a 20 year amortization and to be paid in full by June 1, 2010. The account is current including a regular interest and principal payment paid June 1, 2010, in lieu of full payment. During this deferment, regular principal and interest payments will be made as calculated using a 20 year amortization. Financing with another lender has been secured, but certain filings must be completed prior to closing. The loan maintains personal guarantees by members of Babcock, LLC.
Babcock, LLC is requesting a loan term modification from the Downtown Revolving Loan Fund to delay payment of the full amount due from June 1, 2010, to September 1, 2010, in order to allow time to secure other financing. The loan was initially approved by Council December 14, 2009, with loan terms requiring interest and principal payments calculated using a 20 year amortization and to be paid in full by June 1, 2010. The account is current including a regular interest and principal payment paid June 1, 2010, in lieu of full payment. During this deferment, regular principal and interest payments will be made as calculated using a 20 year amortization. Financing with another lender has been secured, but certain filings must be completed prior to closing. The loan maintains personal guarantees by members of Babcock, LLC.
ALTERNATIVES ANALYZED
The Council may:
- Approve the loan modifications; or Not approve the loan modifications. If Council disapproves the modifications, the loan will immediatly become due. If not paid, the City will pursue remedies available to it in the original loan agreement, which may include executing personal guarantees or forclosure.
FINANCIAL IMPACT
If Council approves the deferral, approxunately $148,000 will not be available for new loans until September 1, 2010.
RECOMMENDATION
Staff and the Downtown Revolving Loan Committee recommend that the City Council approve the request to extend the terms of a $150,000 loan to Babcock LLC from June 1 to September 1, 2010.
APPROVED BY CITY ADMINISTRATOR
Attachments
No file(s) attached.