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Consider Call of Micro Loan: Display Solutions,Inc. <br /> April 11,2005 EDA Meeting <br /> Page 2 of 2 <br /> • Staff Recommendation <br /> The attached Micro Loan Policy states on page 5, number 3 that the loan will become due and <br /> payable in full if the company relocates outside of the City of Elk River prior to the maturity <br /> date of the loan. <br /> In addition, the attached Subsidy Agreement document between Display Solutions and the <br /> EDA indicates on page 1, letter d that if the company relocates outside ofElk River prior to <br /> five years upon receipt of the loan,the company must repay all amounts of the loan. The <br /> Subsidy Agreement also included job and wage goals (7 full-time jobs @ no less than <br /> $12.00/hour within 2 years. Currently, the company has 6 full-time employees, 3 of which <br /> were hired after the receipt of the loan. The employees'wages are $9.00,$12.00 and $15.00 <br /> per hour. <br /> Since the amount of lease space needed by the company is unavailable in Elk River, staff <br /> recommends that the EDA consider the following options when considering the Display <br /> Solutions request: <br /> • Maintain current term (3%interest, 10-year amortization,balloon payment due May <br /> 2007) <br /> • Require loan to be paid in full <br /> • Negotiate adjusted terms for the loan repayment such as: <br /> o Require balloon payment to be paid in May of 2006 rather than May of 2007 <br /> • o Increase interest rate to a market rate <br /> Representatives from Display Solutions will be available at the EDA meeting to discuss their <br /> request and answer questions. <br /> 4111 <br />