Loading...
HomeMy WebLinkAboutResolution #1040.r RESOLUTION N0. 1040 A RESOLUTION APPROVING AN AGREEMENT BETWEEN THE CITY OF CANTON AND THE FIRM OF THE CANTON CORPORATION AND DIRECTING THE MAYOR AND CITY CLERK TO EXECUTE SAID LOAN AGREEMENT ON BEHALF OF THE CITY OF CANTON. WHEREAS, the City of Canton, Illinois has entered into negotiations with the Canton Corporation, an Ohio corporation, fora loan from the City's Enterprise Zone Fund for the amount of $400,000, which funds are made available to the City of Canton through a grant from the Illinois Department of Commerce and Community Affairs; and, WHEREAS, the City Council of the City of Canton, Illinois has reviewed the terms of the proposed Agreement, a copy of which is attached hereto and made a part hereof ~s Exhibit "A"; and, WHEREAS, the City Council of the City of Caeton, Illinois has determined that it is desireable and in the best interest of the City of Canton to approve such Agreement. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CANTON, FULTON COUNTY, ILLINOIS, AS FOLLOWS: 1. That the Loan Agreement (DCCA) between the City of Canton and the Canton Corporation, an Ohio corporation, dated as of August 24, 1984, which is attached hereto and made a part hereof as Exhibit "A", is hereby approved, said Agreement to be subject to and effective pursuant to the terms and conditions set forth therein. 2. That the Mayor and the City Clerk of the City of Canton, Illinois are hereby authorized and directed to execute and deliver said Agreement on behalf of the City of Canton. 3. That this Resolution shall be in full force and effect immediately upon its passage by the City Council of the City of Canton, Illinois and approval by the Mayor thereof. PASSED by the City Council of the City of Canton, Illinois this 7th day of August 1984, upon a roll call vote as follows: AYES: Aldermen Kovachevich, Hammond, Sarff, Workman, Carl, May, Mayor Edwards. NAYS : None . ABSENT: Aldermen Savill, Horr. APPROVED: Donald E, Edwards, Mayor. ATTEST Nancy Whites, ty Clerk, -2- ~m LOAN AGREEMENT (DCCA GRANT) This agreement dated as of August 24, 1984 is between the City of Canton, an Illinois Municipal Corporation (hereinafter called "Lender"), and The Canton Corporation, an Ohio corporation, (herein- after called "Borrower"). In consideration of the mutual covenants and agreements contained herein, Lender and Borrower agree as follows: 1. Loan Terms: Lender agrees to loan the principal sum of Four Houndred Thousand Dollars ($400,000.00) (hereinafter referred to as "Loan"), to be disbursed as hereinafter provided, bearing interest at the rate of 3.0 percent per annum from the date funds are advanced hereunder up to and including August 24, 1999. The term of the loan is for 15 - years from August 24, 1984. This loan is evidenced by a promissory note of even date here- with (Exhibit 1) made payable to the City of Canton, an Illinois Municipal Corporation. Borrower agrees to use the loan and its pro- ceeds solely for activities as set forth in Borrowers application submitted to the Lender and in accordance with Lender's Loan Terms and Conditions relating thereto, and the terms and conditions of this Loan Agreement. EXHIBIT "A" TO RESOLUTION N0. 2. Repayment: Repayment of this loan shall be made as follows: 2.1 Principal shall be paid in twenty-six (26) equal semi-annual installments of ($15,384.62) each commencing on the 1st day of December 1986 and continuing every six months thereafter until said principal is fully paid. ~ 2.2 Interest shall be paid on the unpaid principal balance at the rate of 3.0 percent per annum with the first payment due on December 1st, 1984 and then on June 1st, 1985, and on December 1st and June 1st of each year thereafter succeeding during the term of this loan. 2.3 Unpaid interest shall be added to principal and bear interest at the same rate as noted above for said principal. Interest _ shall be considered unpaid if not received by Lender within 7 calender days following the due date. 2.4 Borrower shall pay a late charge of 6$ of the payment due of principal or interest if payment for any of these is not received within 7 calender days following the due date. The late charge shall be considered unpaid if not received within 15 calendar days of the missed due date for which it was imposed. Any unpaid late charge shall be added to principal and bear interest at the same rate as noted above for said principal. Acceptance of a late charge by Lender does not constitute a waiver of default. 2.5 Borrower shall have the right to prepay any and all interest and principal at any time without penalty or additional interest. -2- 3. Certifications: On or before the date of the loan disbursement, the Borrower shall submit the following documentations to Lender: 3.1 A current copy of the Borrower's articles of incorporation or charter. 3.2 Certifications that there has been no material adverse change in Borrower's financial condition or any condition which would adversely affect the Borrower's ability to carry out the terms and conditions of this agreement. 3.3 If a corporation, a certified copy of Borrower's corporate resolution authorizing and directing the execution and delivery by Borrower to Lender of this agreement and all related documents. 4. Disbursement Procedure: 4.1 Disbursement shall take place after this loan agreement and the promissory note (Exhibit 1) are executed, and the documentation called for in paragraph 3 above and any other conditions precedent to disbursement of funds under this loan are fully satisfied. 4.2 Thereafter, Lender immediately shall cause to be issued a check upon Borrower's written request in the principal amount in paragraph 1 of this agreement. 4.3 Borrower shall notify the Lender of such date of disbursement in writing not less than five (5) days prior to such date. 4.4 Borrower shall maintain a separate ledger and segregated account for the loan funds obtained hereunder. 4.5 Loan amounts shall retain their character as Lender assets while irr Lender's possession. - 3- 5. Reporting Requirements: Borrower understands that Lender is required to make annual, semi- annual, and other periodic reports and audits with respect to the loan funds. Borrower agrees to make all of its books, accounts and other financial data available to Lender, or, Lender's authorized agents (to include Lender's auditors) in support of Lender's requirement to make such reports and audits. Borrower agrees at Borrower's expense, to provide Lender with certified abstracts of any such books, accounts, or other financial data within five (5) working days of Lender's written request therefor. 6. Relending and Assignment: 6.1 Borrower shall not relend any portion of the loan funds received or to be received from Lender. 6.2 Borrower shall not assigh any right, title or interest in and to this Agreement, or, to any security pledged in repayment of this loan without first obtaining Lender's written consent thereto. 7. Default: On the occurrence of any event of default as described below, Lender may declare all or any portion of the debt and interest created hereby to be immediately due and payable and may proceed to enforce its rights under this Loan Agreement or any other instruments securing or relating to this Loan and in accordance with the Law and regulations applicable hereto. Any of the following may, with- out limitation, be regarded an "event of default" in the sole discretion of the Lender: (A) Failure, inability or unwillingness of Borrower to carry out or comply with the specific activities in its loan application as -4- approved by Lender, or Lender's Loan Terms and Conditions, or any terms or conditions of this Loan Agreement, or any appli- cable federal or state laws, or with such Lender regulations as may become applicable at any time. (B) Failure of Borrower to pay any installment of principal or .interest on its promissory note to Lender when due as speci- fied in paragraph 2 above. (C) The occurrence of: (1)Borrower's becoming insolvent or bank- rupt, or ceasing, being unable, or admitting in writing its inability, to pay its debts as they mature, or making a general assignment with creditors; (2) proceedings for the appointment of a receiver, trustee or liquidator of Borrower, or of a substantial part of its assets, being authorized or instituted by or against it; or (3) proceedings under any bankruptcy, reorganization, readjustment or debt, insolvency, dissolution, liquidation or other similar law of any juris- diction being authorized or instituted by or against this Borrower. (D) Submission or making of any report, statement, warranty, or representation by Borrower or agent on its behalf to Lender in connection with the financial assistance awarded hereunder which is false, incomplete or incorrect in any material respect. (E) Failure of Borrower to remedy any material adverse change in its financial or other condition arising since the date of this agreement, which condition was an inducement to this loan. (F) Any attempt by Borrower to assign any right, title or interest in and to this Agreement, or, to any security pledged in repayment of this loan without first obtianing Lender's written consent thereto. -5- 8. Qollateral: The Bon~owps pledges as collateral to secure its indebtedness under this Loan Agreement, its portfolio of investments derived from the proceeds of this loan award, together with such other security as Lender may require, not to exceed in value the total of principal and interest due under this agr~t. Specific collateral outlined on Attachment A to follow. 9. Other Parties: 'This Loan Agreement is not for the benefit of third parties. Lender shall not be under any obligation to any such parties, whether directly or indirectly interested in the Loan Agrea~nt, to pay any charges or expenses incident to oor~liaryce by Borrower with any of the duties or obligations imposed hereby. 10. C7osts and Expenses: " Borrower agrees to reimburse Lender for costs and expenses, court costs, reasonable attorney fees, and all. other out-of-pocket expenses paid by Lender in enforcing the tez~ns and conditions of this agreen~nt occassioned by Borrower's failure to cai~ly with such terms and conditions. Borrower hereby irrevocably consents that all such attorney fees, costs and expenses, and out-,of-pocket expenses may be included in any judgR~ent awarded to Lender in any proceeding at law or in amity to enforce this agreement. 11. Retention and Creation of Jobs: Lender and Borrower recognize and agree that the loan provided by Lender to Borrower is .in direct support of Borrower's expressed intention of purchasing real Property and improvem~ts thereto, industrial machinery and equiFr~t, and other diverse property to be located within bender's --{- corporate limits. Both Lender and Borrower recognize and agree that presently existing jobs are expected to be retained hereby and 75 to 200 new jobs created. Borrower convenants and agrees to not remove jobs retained or created by use of this loan from Lender's corporate limits during the term of the loan as expressed in Paragraph 1 even though Borrower may sooner pay all interest and principal hereunder without first obtaining Lender's written consent. 12. Notice: Notice shall be given to any party hereto by United States mail, certified mail, return receipt requested, and directed to the following addresses: To Lender: City Clerk City Building 210 East Chestnut Street Canton, Illinois 61520 Any notice given to the Lender shall include an informational copy, mailed as aforesaid, and addressed to the attention of the City Attorney at the above stated address. To the Borrower: 13. Successors and Assigns: The Canton Corporation 3140 East 65th Street Cleveland, Ohio 44127 The Loan Agreement shall be binding upon Borrower and its successors and assigns and upon Lender and its successors and assigns, and shall survive the closing of the Loan and disbursement of proceeds. -7- 14. Contincrencies: In addition to any foregoing contingency, loan funds will only be disbursed upon completion of all of the following in form and substance satisfactory to the Lender: (a) Jobs must be created and kept in the Canton Enterprise Zone for the period and otherwise in conformity with 'other requirements expressed in Paragraph 11 of this Loan Agreement. (b) Binding collateral and security satisfactory to the Lender must be provided by Borrower. (c) Borrower must provide Lender with the personal guarantee of Joseph L. Driscoll, President of The Canton Corporation, in the amount of $200,000.00, all in form satisfactory to the Lender. (d) Final written appraisals in form satisfactory to Lender must be completed on all collateral property, real or personal. 15. Applicable Laws: Interpretation of the terms and provisions of this Loan Agreement shall be in accordance with the laws of the State of Illinois. IN WITNESS WHEREOF, Lender and Borrower have executed duplicate originals of this Loan Agreement as of the date first above-mentioned. BORROWER: The Canton Corporation, an Ohio corporation, LENDER: City of Canton, an Illinois municipal corporation, BY: Its President. Date: Address: 3140 East 65th Street Cleveland, Ohio 44127 Phone: (216) 932-2226 ATTEST: Corporate Sectetary. (Corporate Seal) BY: Its Mayor. Date: Address: 210 East Chestnut Street Canton, Illinois 61520 Phone: (309) 647-0065/0020 ATTEST: City Clerk. (Corporate Seal) -8-