(A) No RLF funds shall be used if sufficient funds are available from other sources to finance the project.
(B) No loan will be made where there is reasonable doubt as to the ability of the applicant to repay the loan.
(C) The applicant may be required to provide and assign to the RLF life insurance for the term of the loan.
(D) The applicant will be required to provide fire, hazard, and normal business insurance on all assets for the term of the loan. Said insurance shall be sufficient to secure the RLF loan and shall have a loss payable clause to the city and the Kewanee Community Development Corporation (KCDC), a not-for- profit corporation established to foster economic development within the City of Kewanee. KCDC is also known as Kewanee Economic Development Corporation (KEDC).
(E) The term of the loan shall not exceed five years when the loan is $50,000 or less. The term of the loan shall not exceed seven years when the loan is $50,001 or more. The rate may vary depending on need, term or duration of loan, security and risk of the loan. Covenants such as acceleration of payments, due on sale, balloon payments, variable rates, interest tied to net profit or gross revenues, or other similar loan recapture methods may be required. The minimum interest rate shall be 3%, and the maximum shall be at a rate to be determined by the committee hereinafter defined, which committee shall take into account such factors as risk, ability to pay, and all of the other considerations specified in this document or otherwise being the subject of consideration in the making this nature.
(F) The amount of any single loan from the RLF shall not be less than $1,000 nor more than 95% of the then existing loanable RLF funds on hand.
(G) The loan may be used in a subordinate position to another lender, at the discretion of the committee hereinafter defined, but otherwise a first position will be required.
(H) One job shall be created or retained for each $15,000 of RLF funds used.
(I) Fifty-one percent of the permanent jobs created must be available to low and moderate income persons. Every job shall be listed through job service.
(J) The applicant may not relocate the facilities or employment outside the city during the term of the RLF note unless the outstanding balance is paid in full. If the facilities are, or are to be, located within the one mile limit of the city referred to in § 121.02(B), the facilities or employment may not be located beyond that one mile limit during the term of the RLF note unless the outstanding balance is paid in full.
(K) The applicant, through its owners or officers, will normally be required to personally guarantee repayment of the RLF note, but the same may be waived at the discretion of the committee hereinafter defined.
(L) The applicant will be required to submit quarterly financial statements, including balance sheet and income statement, to the committee during the term of the RLF loan.
(M) The applicant will be required to provide a minimum equity position within the range of 10% - 20% depending on loan amount, loan security and loan risk.
(N) All notes shall be made payable to the city and the KCDC and shall be serviced by a committee as hereinafter defined. Any servicing fee shall be borne by the borrower.
(O) An affirmative action plan for ensuring equal employment opportunity for the jobs to be created shall be required of all borrowers.
(P) Any assignment of the loan by the borrower must be approved by the city and KCDC.
(Q) Funds shall be paid to and held in an account under the accountability of the city. Any payment of funds from said account shall require the signatures of two designated officials, one each from the city and the KCDC.
(Ord. 2986, passed 7-24-95; Am. Ord. 3397, passed 5-27-03)