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A loan shall become due and payable in full if a business relocates outside of the city of Elk River <br />prior to the maturity date of the loan. <br /> <br />Late Payment Charge <br />A late payment charge of 8% of the installment amount will be enforced following a <br />grace period of 10 calendar days. <br /> <br />REGULATION FOR NEW CONSTRUCTION AND IMPROVEMENTS <br />All buildings which public funds will be used for construction or renovation are to be brought into <br />conformance with city ordinances and state building codes. <br /> <br />COVID-19 EMERGENCY PROVISIONS <br />Notwithstanding anything herein to the contrary, loans may be made under this program for retail <br />and service businesses in accordance with Governor Walz’s Executive Order 20-15 issued on March <br />23, 2020. The expanded use of this program shall expire on June 21, 2020. All other provisions of <br />this policy remain the same. <br /> <br />LOAN SECURITY AND GUARANTEES <br />Applicant must be able to secure the loan by providing the EDA with a minimum of a subordinate <br />mortgage upon the building and/or assets or other approved collateral equal to the amount of the <br />loan. <br /> <br />Applicant must demonstrate the financial means to repay the loans, as determined by the EDA. <br /> <br />Whenever possible, personal, corporate, and/or entity guarantees will be made part of any loan <br />agreement. <br /> <br />Key person life insurance may be required as determined by the EDA Finance Committee based on <br />loan amount and company ownership partners. <br /> <br />TIMING OF PROJECT EXPENSES <br />No project should commence until the EDA has approved the loan application. Any costs incurred <br />prior to the approval of the loan application are not eligible expenditures. <br /> <br />No building construction should commence until the required city permits are secured. <br /> <br />The applicant will be responsible for all legal, recording, and other fees required for protection of a <br />security interest in the loan, payable by a $2,000 processing fee, which is paid at the time of <br />application. In addition to the processing fee, all legal and filing fees shall be paid by the borrower <br />at loan closing. <br /> <br />Closing of the Microloan should be simultaneous with the borrower’s primary funding. The EDA <br />should be given two weeks’ notice before closing. <br /> <br />PROCEDURAL GUIDELINES FOR APPLICATION AND APPROVAL <br />1. All applicants shall first contact a primary lending institution to determine if additional <br />equity is needed, and if so, how much (if applicable). <br />5 EDA & City Council Approved April 17, 2017 <br /> <br />