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<br />10-1313 <br /> <br />REDWOOD SHORES CHILD CARE <br />FINANCING TERM SHEET <br />7/20/00 <br />LAST REVISED 10/27/00 <br /> <br />This term sheet outlines the basis terms and conditions under which the City of Redwood City <br />shall provide permanent financing (the "Loan") for the Redwood Shores Child Care Project. <br /> <br />1. Loan Amount: The lesser of $2,950,000 TO 3,200,000 (final amount not yet determined), or <br />80% of project costs. <br /> <br />2. Collateral: The Loan will be secured by a First Deed of Trust supported by a security interest <br />in the leasehold improvements and assignment of rents on the project. <br /> <br />3. Purpose: Proceeds of the Loan will be used to retire the project's construction loan. <br /> <br />4. Construction Loan: The borrower shall be responsible for obtaining a Construction loan for <br />the project through commercial sources and for providing any personal or other guarantees <br />required therein. City will have a reasonable period of time to review and approve <br />construction loan terms and conditions <br /> <br />5. Loan Commitment: Prior to issuance of the construction loan the City shall provide a "Take <br />Out" Loan commitment with standard industry conditions, reasonably satisfactory to the <br />Construction Lender. <br /> <br />6. Timing of Funding: Funding shall occur no earlier than date on which the Redwood City <br />Building Department approves as acceptable all check list items in connection with the <br />project's final inspection and no later than 60 days following such final inspection approval. <br /> <br />7. Loan Term: 20 years, fully amortized over the term of the Loan and callable with 120 days <br />notice after 10 years. The Loan shall be due on sale to a third party not controlled by lessee <br />and no long-term subordinate mortgages shall be allowed. This restriction is not intended to <br />limit subordinate equipment leases and similar non-mortgage financing. <br /> <br />8. Interest Rate: LAIF (Local Agency Investment Fund) plus 1-112%, adjusted quarterly and <br />paid in arrears. <br /> <br />9. Prepayment: The Loan shall be pre-payable at any time without penalty. <br /> <br />10. Title costs: Borrower shall be responsible for all title, escrow and other out of pocket <br />expenses. <br /> <br />K:IFront_officelAdminIKeechIRSChildCareCenterICorrespondencelRWS Child Care Financing,William Euphrat.doc <br /> <br />"T'-'--""""" ,. <br />