3.6. EDSR 05-11-2009 - Laserfiche WebLink

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fiver MEMORANDUM TO: EDA Finance Committee FROM: Catherine Mehelich, Director of Economic Development DATE: April 27, 2009 SUBJECT: Discuss Micro Loan with Nicole's Finishing Touch Salon, Inc. Attachments • Letter from Joseph Brandenburg and Nicole Fox, dated Apri17, 2009 • Current Amortization Schedule -Nicole's Finishing Touch Salon, Inc. • Sample Extended Amortization Schedule • Downtown Business Revitalization Micro Loan Program Issue Nicole Fox, owner of Nicole's Finishing Touch Salon, Inc. and her stepfather Joseph Brandenburg have requested the Finance Committee's consideration of restructuring the existing Micro Loan. The Finance Committee is asked to review and provide a recommendation to the EDA regarding the request. Background In January 2008, the EDA awarded a $25,000 Micro Loan at 3% interest to Nicole's Finishing Touch Salon, Inc. under the Downtown Business Revitalization Program. Ms. Fox indicated the loan would be used to increase advertising and other promotional activities to assist overcome negative impacts of their delay in relocating their business from Otsego to the Bluffs during the construction. The original terms of the loan were fora 2-year term, 3% fixed rate, direct loan with the EDA, and secured by a personal guaranty from the owner. In January 2009, following review and recommendation of the Finance Committee, the EDA approved a 1-year extension on the loan terms in order to reduce the monthly payment amount to assist the business cash flow (see attached December 18, 2008 Finance Committee minutes for details). Recently staff has had discussions with Joseph Brandenburg, representing his stepdaughter Nicole Fox, along with his submittal of the attached letter offering a significant pay off on