87-026 RES
.
.
.
RESOLUTION 87 - 26
A RESOLUTION FOR THE CITY OF ELK RIVER
A RESOLUTION AUTHORIZING SUBSTITUTION OF LENDER
FOR THE ROMA TOOL GRANT
WHEREAS, the City of Elk River (City) received an economic recovery grant
(Grant) from the State of Minnesota. subject to the terms of a Grant
Agreement by and between the State of Minnesota. acting by and
through the Department of Energy and Economic Development and the
City dated February 20. 1986; and
WHEREAS, the City loaned such Grant proceeds to Roma Tool & Plastics. Inc.
(Roma) and secured such loan with a Security Agreement by and
between the City and Roma dated March 19. 1986 (Security Agreement);
and
WHEREAS, Section 1.2 of the Security Agreement provides that the City's
interest will be subordinate to the security interest of Congress
Financial Corporation (Congress) which has provided f~nancing for
working capital and equipment (Working Capital and Equipment Loan)
and that the City will continue to subordinate its interest in the
event Roma refinances such Working Capital and Equipment Loan with
another lender; and
WHEREAS, Roma has negotiated a refinancing of the Working Capital and
Equipment Loan with ITT Commercial Finance Corp.. 100 Walnut Avenue.
Clark. New Jersey 07066 (ITT); and
WHEREAS, ITT requires first position on all equipment and machinery held by
Roma as collateral before it will provide such financing.
NOW. THEREFORE. BE IT RESOLVED by the City Council of the City of Elk River
that the City hereby agrees to amend the Security Agreement to
substitute ITT Commercial Finance Corp. for Congress Financial
Corporation so that the City's security interest in the Collateral
(as defined in the Security Agreement) will be subordinate to the
security interest of ITT; and that the Mayor and City Administrator
are hereby authorized to execute all documentation required to
accomplish such refinancing; and that this application be sent to
Minnesota Department of Energy and Economic Development for final
approval.
Passed and adopted by the City Council of the City of Elk River. this 1st day
of June. 1987.
c2i:db C ~1
Estelle E. Gunkel. Mayor
ATTEST:
~rtd Z< J;(~
Patrick D. Klaers. C1ty Administrator