HomeMy WebLinkAboutPR 21159: EDC, MICRO-LOAN AGREEMET WITH SHERRIE HAYES DBA GRACE LINE TRUCKING, IN THE AMOUNT OF $30,000.00 Interoffice
MEMORANDUM
To: Mayor, City Council, City Manager
From: Floyd Batiste, CEO
Date: November 12, 2019
Subject: P.R. No. 21159; Council Meeting of November 19, 2019
ATTACHED IS PROPOSED RESOLUTION NO. 21159, A
RESOLUTION APPROVING A MICRO LOAN AGREEMENT
BETWEEN THE CITY OF PORT ARTHUR SECTION 4A
ECONOMIC DEVELOPMENT CORPORATION AND
SHERRIE HAYES, FOR AN AMOUNT OF THIRTY
THOUSAND DOLLARS AND 00/100 DOLLARS ($30,000),
ACCOUNT NO. 119-1426-554.54-00
P.R. NO. 21159
11/05/2019 RAJ
RESOLUTION NO.
A RESOLUTION AUTHORIZING THE CITY OF PORT ARTHUR
SECTION 4A ECONOMIC DEVELOPMENT CORPORATION TO
ENTER INTO A MICRO-LOAN AGREEMENT WITH SHERRIE
HAYES DBA GRACE LINE TRUCKING IN THE AMOUNT OF
$30,000.00 FOR REFINANCING OF A DUMP TRUCK USED FOR
GRACE LINE TRUCKING; FUNDS AVAILABLE IN EDC ACCOUNT
NO.119-1426-554.54-00
WHEREAS,per Resolution 06-425,the City of Port Arthur entered into an agreement with
the City of Port Arthur Section 4A Economic Development Corporation ("PAEDC") for the
administration of its Micro-Loan Program; and
WHEREAS, at the PAEDC regular Board meeting on November 4, 2019, the Board
authorized its Chief Executive Officer to enter into a micro-loan agreement with Sherri Hayes dba
Grace Line Trucking in the amount of$30,000 to assist with refinancing her current loan with a local
credit union; and
WHEREAS,PAEDC and Sherri Hayes dba Grace Line Trucking will enter the Micro-Loan
Agreement attached hereto and incorporated herein as Exhibit "A" which sets out the terms and
conditions of the loan; and
WHEREAS,Sherri Hayes dba Grace Line Trucking will pay the loan back to PAEDC within
six (6) years per the terms and conditions set forth in Exhibit "A".
NOW THEREFORE,BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF PORT ARTHUR, TEXAS:
Section 1. That the facts and opinions in the preamble are true and correct.
Section 2. That PAEDC is herein authorized to enter into a Micro-Loan Agreement with
Sherri Hayes dba Grace Line Trucking for$30.000 for refinancing a current loan with a local credit
union; and
Section 3. That a copy of the caption of this Resolution be spread upon the Minutes of the
City Council.
READ,ADOPTED AND APPROVED on this day of A.D.,2019,at a
Meeting of the City Council of the City of Port Arthur, Texas, by the following vote: AYES:
Mayor
Councilmembers
NOES:
Thurman Bartle, Mayor
ATTEST:
Sherri Bellard, City Secretary
APPROVE .
l �
Floyd Batiste, PAEDC CEO
1699935 Page 2
APPROVED AS TO FORM:
Guy N:Goodson, PAEDC Attorney
APPROVED AS TO FORM:
Valecia R. Tizeno, City Attorney
APPROVED AS TO AVAILABILITY OF FUNDS:
Ck_1\-----n
Kandy Daniel, I terim Finance Director
41699985
Page 3
Exhibit " A "
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Micro-Loan Agreement
This Micro-Loan Agreement (the "Agreement") is executed as of this day of
, 2019 (the "Effective Date") between the City of Port Arthur Economic
Development Corporation, a Texas economic development corporation authorized to do
business in the State of Texas under Section 504, Texas Local Government Code(the "PAEDC")
and Sherrie Hayes d/b/a Grace Line Trucking (the "Borrower") whose address is 2317
Lavender Street, Port Arthur, Texas 77640.
RECITALS
A. PAEDC is a Type A Economic Development Corporation authorized to do
business in the State of Texas under Section 504, Texas Local Government Code.
B. PAEDC is authorized per Resolution 17-132 to manage the City of Port Arthur's
Micro-Loan Program.
C. Borrower plans to use the micro-loan in the amount of$30,000.00 (the "Loan")
for the purpose of refinancing her current loan for a lower interest rate.
D. Borrower's business, Grace Line Trucking is a local Port Arthur business.
E. PAEDC and Borrower agree that all reimbursements to Borrower are subject to
the conditions, procedure and eligibility requirements specified in this Agreement.
F. Borrower agrees that the loan to be provided by PAEDC shall be used solely to
re-finance the loan she currently has at a lower interest rate, and as specified in its Application
submitted to the Micro-Loan Committee attached hereto as Exhibit "A" and made a part hereof
for all purposes (the "Application").
G. Borrower agrees that PAEDC will loan to Borrower up to $30,000.00 for the
Project.
H. Borrower agrees to repay the loan to PAEDC as specified in this Agreement.
NOW, THEREFORE, IN CONSIDERATION of the RECITALS which are
incorporated in this Agreement as fully set forth below and for other good and valuable
consideration of the receipt and sufficiency is hereby acknowledged, PAEDC and Borrower
agree to the following conditions and procedures for the grant:
1) Loan Amount and Approved Project Cost. PAEDC has agreed to loan
Borrower up to $30,000.00 (the "Loan Amount") to Grantee to fund the cost associated with
refinancing her current loan for a lower interest rate, as set forth in Exhibit "C". Any costs in
excess of the Loan Amount shall be solely borne by Borrower.
2) Payment Procedures. PAEDC will only fund up to $30,000.00 of the eligible
infrastructure improvements. PAEDC will reimburse the Loan Amount to Grantee after
Borrower submits a detailed invoice to PAEDC.
3) Borrower Covenants.
a) Borrower must provide PAEDC a project budget;
b) Borrower must provide PAEDC an invoice to receive reimbursement;
c) Borrower has read and agrees to abide by the provisions and requirements of the
City of Port Arthur's Micro-Loan Program ; and
d) Borrower has executed a deed of trust in the amount of the loan as security.
4) Term of Loan. Borrower agrees to pay back the loan to PAEDC in six (6) years
with an interest rate of 4% as set forth in the amortization scheduled attached hereto as Exhibit
A. Borrower further agrees to execute a promissory note in substantially the same form as the
one attached hereto as Exhibit B.
5) Project Changes. As stated herein, Borrower may make minor revisions to the
Project, but may not make any substantial revisions without approval of PAEDC. Borrower
retains the right to expand the Project at its sole cost and expense with additional improvements
or costs to be solely borne by Grantee.
6) Indemnification. Borrower agrees to indemnify and hold PAEDC, its staff,
officers and the City of Port Arthur, from any and all actions preceding claims, demands, costs,
damages and expenses including reasonable attorneys' fees arising out of or related to the Project.
7) Assignability. The rights and liabilities under this Agreement shall not be
assigned by Grantee in whole or in part without the prior written consent of the PAEDC.
8) Law and Ordinances. Borrower shall be responsible for compliance with all
applicable laws, regulations and ordinances including building and zoning codes and for
obtaining all necessary licenses and permits required for the Project.
9) Governing Law. This Grant Agreement shall be governed under the laws of the
State of Texas, and venue for any matters arising under this Grant Agreement shall be in the
courts of competent jurisdiction in Jefferson County, Texas.
SIGNED AND AGREED TO on the day of , 2019.
By:
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Sherrie Hayes
CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT CORPORATION
SIGNED AND AGREED TO on the day of , 2019.
President Secretary
Witness Witness
ATTORNEY APPROVALS
APPROVED AS TO FORM:
Guy N. Goodson
General Counsel for PAEDC
VERIFIED AS CONSISTENT
WITH CITY COUNCIL RESOLUTION: Resolution Number:
City Attorney
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Exhibit A
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Exhibit B
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU
MAY REMOVE OR STRIKE ANY OF THE FOLLOWING INFORMATION FROM THE
INSTRUMENT BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS:
YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
NOTE
November , 2019
1. BORROWER'S PROMISE TO PAY
In return for a loan that I have received (the "Loan"), I, Sherrie Hayes ("Borrower"),
promise to pay U.S. $30,000.00 (this amount is called "principal"), plus interest, to the order of
the City of Port Arthur Section 4A Economic Development Corporation (the "Lender"). The
Lender is an economic development corporation organized and existing under the laws of the State
of Texas. The Lender or anyone who takes this Note by transfer and who is entitled to receive
payments under this Note is called the "Note Holder." The Loan is being made in order to assist
me in growing my business known as Grace Line Trucking (the "Project").
2. INTEREST
Interest will be charged on unpaid principal until the full amount of principal has been paid.
I will pay interest at a yearly rate of 4%. The interest rate required by this Section 2 is the rate I
will pay except after any default described in Section 6(B) of this Note. Upon an event of Default,
Borrower agrees to pay interest at a yearly rate of 10% per annum.
3. PAYMENTS:
(A) Lender has provided the hereinabove described loan pursuant to Borrower.
Borrower shall repay the loan over a six (6) year period in monthly installments in the amount of
$469.36 starting on December 28, 2019, see attached Amortization Schedule.
(B) The loan is securitized by a deed of trust and effective contemporaneously with the
execution of this Note.
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(C) Defaults
In the event of Defaults, the loan to be repaid shall be the difference between the principal
shown hereinabove and any forgiven portion of the principal.
4. BORROWER'S RIGHT TO PREPAY
I have the right to make payments of principal at any time before they are due. A payment
of principal only is known as a "prepayment." When I make a prepayment, I will tell the Note
Holder in writing that I am doing so.
I may make a full prepayment or partial prepayments without paying any prepayment
charge. The Note Holder will use all of my prepayments to reduce the amount of principal that I
owe under this Note. If I make a partial prepayment, there will be no changes in the due date or in
the amount of my monthly payment unless the Note Holder agrees in writing to those changes.
I have the right to prepay the principal amount of this Note, together with any accrued
interest, without any prepayment charge provided that such prepayment is in full and not in part.
5. LOAN CHARGES
If a law, which applies to this loan and which sets maximum loan charges, is finally
interpreted so that the interest or other loan charges collected or to be collected in connection with
this loan exceed the permitted limits, then: (i)any such loan charge shall be reduced by the amount
necessary to reduce the charge to the permitted limit; and (ii) any sums already collected from me
which exceeded permitted limits will be refunded to me. The Note Holder may choose to make
this refund by reducing the principal I owe under this Note or by making a direct payment to me.
If a refund reduces principal, the reduction will be treated as a partial prepayment.
6. BORROWER'S FAILURE TO PAY AS REQUIRED
(A) Default
Defaults shall be as provided in Section 3(C) above.
(B) Notice of Default
If I am in default, the Note Holder may send me a written notice telling me that if I do not
pay the overdue amount by a certain date, the Note Holder may require me to pay immediately the
full amount of principal which has not been paid and all the interest that I owe on that amount. That
date must be at least 30 days after the date on which the notice is delivered or mailed to me.
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(C) No Waiver By Note Holder
Even if, at a time when I am in default, the Note Holder does not require me to pay
immediately in full as described above, the note Holder will still have the right to do so if I am in
default at a later time.
(D) Payment of Note Holder's Costs and Expenses
If the Note Holder has required me to pay immediately in full as described above, the Note
Holder will have the right to be paid back by me for all of its costs and expenses in enforcing this
Note to the extent not prohibited by applicable law. Those expenses include, for example,
reasonable attorneys' fees.
7. GIVING OF NOTICES
Unless applicable law requires a different method, any notice that must be given to me under
this Note will be given by delivering it or by mailing it by first class mail to me at the Property
Address above or at a different address if I give the Note Holder a notice of my different address.
Any notice that must be given to the Note Holder under this Note will be given by mailing
it by first class mail to the Note Holder at 501 Procter Street, Suite 100, Port Arthur, Texas 77640
or at a different address if I am given a notice of that different address.
8. OBLIGATIONS OF PERSONS UNDER THIS NOTE
If more than one person signs this Note, each person is fully and personally obligated to
keep all of the promises made in this Note, including the promise to pay the full amount owed.
Any person who is a guarantor, surety or endorser of this Note is also obligated to do these things.
Any person who takes over these obligations, including the obligations of a guarantor, surety or
endorser of this Note, is also obligated to keep all of the promises made in this Note. The Note
Holder may enforce its rights under this Note against each person individually or against all of us
together. This means that any one of us may be required to pay all of the amounts owed under this
Note.
9. WAIVERS
I and any other person who has obligations under this Note waive the rights of presentment
and notice of dishonor. "Presentment" means the right to require the Note Holder to demand
payment of amounts due. "Notice of dishonor" means the right to require the Note Holder to give
notice to other persons that amounts due have not been paid.
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10. UNIFORM SECURED NOTE
This Note is a uniform instrument with limited variations in some jurisdictions. In addition
to the protections given to the Note Holder under this Note, a Subordinate Mortgage, Deed of Trust
or Security Deed(the "Subordinate Security Instrument"), dated the same date as this Note, protects
the Note Holder from possible losses which might result if I do not keep the promises which I make
in this Note. The Subordinate Security Instrument is and shall be subject and subordinate in all
respects to the liens, terms, covenants and conditions of the First Deed of Trust. The Subordinate
Security Instrument describes how and under what conditions I may be required to make immediate
payment in full of all amounts I owe under this Note. Some of those conditions are described as
follows:
Transfer of the Property or a Beneficial Interest in Borrower. Except for a conveyance to
the Trustee under the First Deed of Trust, if all or any part of the Property or any interest in it is
sold or transferred (or if a beneficial interest in Borrower is sold or transferred and Borrower is not
a natural person) without Lender's prior written consent (including a transfer of all or any part of
the Property to any person who, at initial occupancy of the Property, does not use the Property for
affordable housing as defined by the Lender in the, Lender may, at its option, require immediate
payment in full of all sums secured by this Security Instrument. However, this option shall not be
exercised by Lender if exercise is prohibited by federal law as of the date of this Security Instrument.
If Lender exercises this option, Lender shall give Borrower and the Senior Lien Holder
prior written notice of acceleration. The notice shall provide a period of not less than 30 days from
the date the notice is delivered or mailed within which Borrower must pay all sums secured by this
Security Instrument. If Borrower fails to pay these sums prior to the expiration of this period,
Lender may invoke any remedies permitted by this Security Instrument without further notice or
demand on Borrower.
BORROWER:
Sherrie Hayes
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