HomeMy WebLinkAbout09 166 FOTP Loan Agreement By-Law
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THE CORPORATION OF THE MUNICIPALITY OF KINCARDINE
KBT
BY-LAW
NO. 2009 -166
BEING A BY-LAW TO ENTER INTO A LOAN AGREEMENT WITH THE
FRIENDS OF THE KINCARDINE BEACH PAVILION COMMUNITY CENTRE
WHEREAS Section 107 of the Municipal Act, 2001, S.D. 2001, c. 25, as
amended, authorizes a municipality to make a grant, by way of loan, to any
person, group or body, for any purpose the council considers to be in the
interests of the municipality;
AND WHEREAS the Municipality of Kincardine is the owner of lands and
premises at 156 Durham Street, Kincardine and known as the Kincardine Beach
Pavilion Facility (the Pavilion);
AND WHEREAS the Friends of the Pavilion was formed to restore the Pavilion
and enter into an agreement to operate and manage the Pavilion;
AND WHEREAS the Friends of the Pavilion incorporated as the Friends of the
Kincardine Beach Pavilion Community Centre;
AND WHEREAS the Friends of the Kincardine Beach Pavilion Community
Centre have applied to The Corporation of the Municipality of Kincardine for a
loan in the amount of $350,000.00 to be used to repay current loans and
accounts payable incurred in the restoration of the Pavilion and to complete
additional renovations;
AND WHEREAS with the passage of By-law No. 2009 - 162 the Council of The
Corporation of the Municipality of Kincardine authorized the borrowing of three
hundred and fifty thousand dollars ($350,000.00) from the Canadian Imperial
Bank of Commerce (CIBC) for a term of 10 years with a 10 year amortization at
an interest rate of CIBC's rate of prime plus 21 bases points, in addition to any
reasonable charges of CIBC associated with borrowing, to fund a loan to the
Friends of the Kincardine Beach Pavilion Community Centre;
AND WHEREAS Council deems it necessary to enter into a loan agreement with
the Friends of the Kincardine Beach Pavilion Community Centre in the amount of
$350,000.00;
NOW THEREFORE, the Council of The Corporation of the Municipality of
Kincardine ENACTS as follows:
1. That The Corporation of the Municipality of Kincardine approve a loan, in
the amount of $350,000.00 to the Friends of the Kincardine Beach
Pavilion Community Centre with terms as set out in the Loan Agreement,
attached hereto, as Schedule 'A' and forming part of the By-law.
2.
That the Mayor and Chief Administrative Officer be authorized and
directed to sign and execute, on behalf of The Corporation of the
Municipality of Kincardine, the loan agreement with the Friends of the
Kincardine Beach Pavilion Community Centre, attached as Schedule 'A',
and any other documents required.
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Page 2
FOTP Loan Agreement By-law
By-law No. 2009 - 166
3.
4.
This by-law shall come into full force and effect at the time of its passing.
This by-law may be cited as the "FOTP Loan Agreement By-law".
READ a FIRST and SECOND time this 11th day of November, 2009.
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~Clerk
READ a THIRD time and FINALLY PASSED this 11th day of November, 2009.
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~Clerk
ScreduJe 'A \ +0 bf lu \/0 )\\0. aG09 - \ lo lo
FRIENDS OF THE KINCARDINE BEACH PAVILION COMMUNITY CENTRE
LOAN AGREEMENT
Agreement made this
11 th
day of 1hvf'm\:k- (,2009
BETWEEN:
THE CORPORATION OF THE MUNICIPALITY OF KINCARDINE
(Hereinafter called "Kincardine")
OF THE FIRST PART
-and-
FRIENDS OF THE KINCARDINE BEACH PAVILION COMMUNITY CENTRE
(Hereinafter called "Friends")
And who are
Successors to Friends of the Pavilion and Gary Gurbin, Trustee for Kincardine Pavilion
Inc.
OF THE SECOND PART
WHEREAS Kincardine is the owner of lands and the building situated on them located at
156 Durham Street, Kincardine, Ontario and known as the "Kincardine Beach Pavilion
Facility" (hereafter called the Pavilion).
AND WHEREAS the Pavilion is part of the Cultural Heritage of Kincardine and the
surrounding region.
AND WHEREAS the Friends was formed to restore the Pavilion and entered into an
agreement authorized by By-Law # 2007-289 dated October 3, 2007 to operate and
maintain the Pavilion.
AND WHEREAS the Friends has applied to Kincardine for a loan of $350,000 to be used
to repay current loans and accounts payable incurred in the restoration of the Pavilion and
to complete additional renovations consisting of air conditioning and a fenced patio.
AND WHEREAS by resolution No. 05/06/09-04 dated May 6, 2009 the Council of the
Municipality of Kincardine approved the loan, subject to passing a by-law authorizing a
loan agreement between Kincardine and Friends.
NOW THEREFORE In consideration of this agreement and other good and valuable
consideration it is agreed by Kincardine and Friends as follows:
Page] of8
1.0 THE LOAN
1.1 The application by Friends to Kincardine for a loan of up to $350,000. from
Kincardine is approved by Kincardine. This loan shall be supported by a
mirrored loan between Kincardine and a lender of its choice.
1.2 The loan shall be subject to the following Terms:
1.2 (a) Principal Amount of the Loan -maximum of$350,000 which will be
advanced in one single amount.
1.2 (b) Term - 10 years, no early repayment
1.2 (c) Amortization - 10 years
1.2 (d) Interest rate - Interest on this loan will be fixed with the rate to be the
same as that charged Kincardine on the loan from its lender of choice
which supports this loan. It shall be charged semi-annually and
payable semi-annually in arrears. Interest payments will be made in
accordance with Schedule "A" attached hereto.
1.2 ( e) Interest is payable both before and after maturity or demand, default
and judgment.
1.2 (f) The principle ofthe loan shall be repaid in 20 semi-annual
installments and will be made in accordance with Schedule "A"
attached hereto. Any amounts repaid may not be re-borrowed.
1.2 (g) A fee of $250.00 shall be paid to Kincardine by Friends prior to the
original loan drawdown. Thereafter a fee of $20.00 shall be added to
each payment to cover the cost of processing both the Friends' loan
from Kincardine and Kincardine's supporting loan from its lender of
choice.
1.2(h) Each payment under this agreement shall be applied first in payment
of fees, then interest and the balance, if any, shall be applied in
reduction of principal.
1.2 (i) All chattels owned by Friends either currently or over the term of this
agreement shall be pledged as security for this loan.
2.0 CONDITIONS ON ADVANCE OF THE LOAN
2.1 The loan shall at the earliest be disbursed 2 Business Days following
Kincardine's receipt of its drawdown on mirrored financing obtained from its
lender of choice.
Page 2 of8
2.2 The loan proceeds shall be deemed to be applied to payoff any outstanding
existing loans and accounts payable the Friends or its predecessors may have
for the restoration of the Pavilion as of the date of the loan advance. If the
entire $350,000 is not required for this purpose, Friends may use the funds for
other renovations or operations of the Pavilion at its discretion. Friends will
supply Kincardine with documentation from each lender or accounts payable
creditor stating that the balance has been paid in full within 15 calendar days
of the advance ofthe loan to Friends from Kincardine.
2.3 Prior to advancing the loan, Friends shall deliver to the Municipal Treasurer
the following materials:
2.3 (a)
A certificate of Insurance in a form satisfactory to the Municipal
Treasurer confirming that Friends has put in effect in its name, all
the necessary insurance that would be considered appropriate for a
prudent tenant undertaking this type of operation with insurers
acceptable to the Municipality, including:
I. Commercial General Liability Insurance, for all third party
claims for bodily injury, personal injury and property damage
arising from the use of the Pavilion by Friends, its directors,
employees, volunteers etc., to an inclusive limit of not less than
Two Million Dollars ($2,000,000.00) per occurrence. The
policy shall include:
a) The Corporation ofthe Municipality of Kincardine as an
additional insured;
b) Cross liability
c) Contractual liability;
d) Tenant's Legal Liability
e) Contents coverage on a replacement cost basis for all property
owned by Friends; and
f) A thirty (30) day written notice of cancellation
Friends will maintain this insurance at its expense.
2.3 (b) Financial Statements for the year ended September 30, 2007 and
September 30, 2008 prepared in accordance with Canadian Generally
Accepted Accounting Principles (GAAP) consistently applied together
with a Review Engagement Report prepared by an independent accountant
holding a current membership with a recognized accounting body in the
Province of Ontario. A supporting schedule detailing the restoration costs
and revenues shall accompany these statements.
2.3 (c) A list of the chattels owned by Friends.
Page 30[8
3.0 INSURANCE AND INDEMNIFICATION
3.1 Kincardine at its sole discretion may in writing change the insurance required
under this Agreement including but not limited to, the limit of insurance. The
revised insurance requirements will come into effect at the latest of:
- 4 months from the date of notice
Or
- upon the next renewal date ofthe Friends' existing policy at the date notice
is provided.
The Friends will maintain this insurance at its expense.
3.2 Friends shall provide the Municipality with additional Certificates of
Insurance within 15 calendar days of either an annual renewal for insurance
coverage as set out in 2.3 (a) or the date ofthe written insurance requirement
in 3.1. Certificates shall be provided for the entire period during which this
Agreement is in effect.
3.3 Friends hereby indemnifies Kincardine, its officers and employees and agrees
to hold each of them harmless from all loss, claims, damages and expenses
(including legal and audit expenses) which may be suffered or incurred in
connection with Kincardine having entered into this Agreement or by breach
by Friends of any representation, warranty, or covenant under this Agreement.
This indenmity will survive the termination of this Agreement and the
repayment of all indebtedness and liability hereunder.
4.0 FINANCIAL REPORTING AND ADMINISTRATION OF AGREEMENT
4.1 Friends shall prepare or cause to have prepared, for the year ending September
30th of each year this Agreement is in force, annual Financial Statements in
accordance with Canadian GAAP consistently applied together with a Review
Engagement Report prepared by an independent accountant holding a current
membership with a recognized accounting body in the Province of Ontario. A
supporting schedule detailing the restoration costs and revenues, if any, shall
accompany these statements. The Financial Statements and supporting
schedule shall be delivered to the Municipal Treasurer no later than May 31 st
in the following year.
4.2 Friends shall deliver to the Municipal Treasurer an updated list of chattels
owned by Friends as of September 30th of each year this Agreement is in force
no later than May 31 st in the following year.
4.3 Friends shall deliver to the Municipal Treasurer any other documents or
information as the Municipal Treasurer may request in writing from time to
time in relation to the loan or the financial activity of Friends within 30
calendar days of the date of the written request.
Page 4 of8
4.4 The administration of this agreement on behalf of Kincardine shall be
conducted by the Municipal Treasurer and Friends shall report to and deliver
all reports, certificates and make all loan payments to the Municipal Treasurer
as required by this agreement.
5.0 REPRESENTATIONS AND WARRANTIES
5.1 There are no actions, suits or proceedings, including appeals or applications
for review, or any knowledge of pending actions, suits, or proceedings against
Friends before any court or administrative agency which would result in any
material adverse change in the property, assets, financial condition, business
or operations of Friends except as disclosed in writing to Kincardine prior to
advance of the funds.
5.2 Friends will inform Kincardine of any future actual or probable litigation and
furnish Kincardine with copies of details of any litigation or other proceedings
which might materially affect the financial condition, business, operations, or
prospects of Friends within 5 Business Days of becoming aware of such
litigation.
5.3 Friends will advise Kincardine within 5 Business Days after the happening of
any event which will result in material adverse change in the financial
conditions, business, operations or prospects of Friends or the occurrence of
any Event of Default or default under this Agreement or any other agreement.
5.4 The Financial statements delivered to Kincardine fairly present the present
financial position of Friends, and have been prepared by Friends in
accordance with Canadian GAAP consistently applied and reviewed by an
independent accountant holding a current membership with a recognized
accounting body in the Province of Ontario.
5.5 Friends will provide Kincardine with the information and financial data the
Treasurer may request in writing from time to time within 30 calendar days of
the written request.
6.0 EVENT OF DEFAULT
6.1 Where the Friends is in default of any section ofthis agreement including, but
not limited to:
. late payment or late provision of documentation
. false or misleading representation, warranty or statement made hereunder,
made in connection with the execution and delivery of this Agreement at
any time.
. a breach or non-performance or non-observance of any term or condition
of this Agreement and, if such default is capable of being remedied, the
default continues un-remedied for 5 Business Days after the occurrence
Page 5 of8
. If any judgment for the payment of monies is made against Friends and it
is not discharged within 30 calendar days from the imposition of such
judgment,
then the following process shall be followed by Kincardine:
1. During the period of default all overdue amounts of fees, interest and
principle shall bear interest from the date on which the same became due
until the date of payment at the rate of 5% per annum
2. Telephone and/or e-mail contact will be made once the default is 30
calendar days past due
3. A letter shall be sent once the default is 60 calendar days past due
4. Where the default involves a late payment, in addition to and not in
limitation of any rights now or hereafter granted under applicable law,
Kincardine may at any time and from time to time without notice to
Friends or any other Person, any notice being expressly waived by
Friends, set-off, compensate and apply any and all amounts payable by
Kincardine to or for the credit of Friends against and on account of the
indebtedness and liability under this Agreement including any amounts
owed for fees.
5. The Municipal Treasurer will provide a written report of the default to
Committee of the Whole (COW). Friends agrees that in the event of a
default, a representative of the Friends Board will appear as a delegation at
the same meeting the Municipal Treasurer's report is presented to COW to
explain the reasons for the default to Council and answer any questions
that Council may have relating to the status of the loan and the operations
of the Pavilion.
6. Council will provide direction to staff in the form of a motion as to how
the default is to be managed.
7. In the event that a satisfactory arrangement cannot be worked out between
Kincardine and Friends to remedy the default, the entire balance
outstanding shall become due and payable 20 calendar days after a
registered letter is sent to Friends.
8. In the event of a default, subject to any other rights it may have under this
agreement, or at law, Kincardine may terminate this agreement and any
licenses of occupation or other rights that the Friends might have shall be
terminated forthwith and Kincardine shall have the right to go into
possession and fully administer and operate the Pavilion at its sole
discretion.
7.0 BENEFIT OF THE AGREEMENT
7.1 This Agreement shall enure to the benefit and be binding on Friends and
Kincardine and their respective successors.
Page 6 of8
8.0 ASSIGNMENT
8.1 This agreement shall not be assigned by Friends without the expressed written
consent of Kincardine having been fIrst obtained as authorized by By-law.
9.0 NOTIFICATION
9.1 NotifIcation is deemed to be given to each of the respective parties if
delivered to:
Friends of the Kincardine Beach Pavilion Community Centre
156 Durham St.
P.O. Box 714
Kincardine, Ontario
N2Z 2X9
Attention: Barb Fisher
519-386-9933
The Corporation of the Municipality of Kincardine
1475 5th Concession
RR#5
Kincardine, Ontario
N2Z 2X6
519-396-3468
9.2 Any change in notifIcation address by one party shall be provided to the other
party within 10 calendar days of the change.
Signed sealed and witnessed by the parties hereto:
Friends of the Kincardine Beach Pavilion Community Centre
k6~ ~
e...."'. I- ~
(president) C"p......,. "". G,,~I?'\,;)
~J-~
(Secretary)
We have the authority to bind the corporation.
Page 7 of8
The Corporation of the Municipality of Kincardine
~ "6: I
v'\' ->- t:..A 01 0--11\,
~ - John deRosenroll
We have the authority to bind the corporation
Page 8 of8
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FRFT - Amortization Calculator
U f - Corporation of The Municipality of Kincardine
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Inputs
Principal Balance
Term (Years)
Amortization (Years)
Payments Per Year , semi - annually
Advance Date (mm /dd /yyyy)
First Payment Date (mm /dd/yyyy) �.
Interst Rate �-' � t• A IFA ,:. s,.
Days Prior to 1st Payment 169
Interst Accrued prior to 1st Payment $6,701.26
Calculations
Payment
# of Periods
# of Periods (Term) 2t
The amortization calculator is intended to be used for illustrative purposes. The sample calculations were prepared using
conventional compound interest principles, and are provided for guidance only. Actual calculations may vary.
Pmt No. Period Starting Principal Payment Fee Principal Interest Remaining Principal
• 1 5/1/2010 $ 350,000.00 $ 21,564.72 $ 20.00 $ 14,843.46 $ 6,701.26 $ 335,156.54
2 11/1/2010 $ 335,156.54 $ 21,564.72 $ 20.00 $ 14,615.06 $ 6,929.66 $ 320,541.48
3 5/1/2011 $ 320,541.48 $ 21,564.72 $ 20.00 $ 14,917.24 $ 6,627.48 $ 305,624.24
4 11/1/2011 $ 305,624.24 $ 21,564.72 $ 20.00 $ 15,225.66 $ 6,319.06 $ 290,398.58
5 5/1/2012 $ 290,398.58 $ 21,564.72 $ 20.00 $ 15,540.47 $ 6,004.25 $ 274,858.11
6 11/1/2012 $ 274,858.11 $ 21,564.72 $ 20.00 $ 15,861.78 $ 5,682.94 $ 258,996.33
7 5/1/2013 $ 258,996.33 $ 21,564.72 $ 20.00 $ 16,189.74 $ 5,354.98 $ 242,806.59
8 11/1/2013 $ 242,806.59 $ 21,564.73 $ 20.00 $ 16,524.48 $ 5,020.25 $ 226,282.11
9 5/1/2014 $ 226,282.11 $ 21,564.72 $ 20.00 $ 16,866.13 $ 4,678.59 $ 209,415.98
10 11/1/2014 $ 209,415.98 $ 21,564.72 $ 20.00 $ 17,214.86 $ 4,329.86 $ 192,201.12
11 5/1/2015 $ 192,201.12 $ 21,564.72 $ 20.00 $ 17,570.79 $ 3,973.93 $ 174,630.33
12 11/1/2015 $ 174,630.33 $ 21,564.72 $ 20.00 $ 17,934.08 $ 3,610.64 $ 156,696.25
13 5/1/2016 $ 156,696.25 $ 21,564.73 $ 20.00 $ 18,304.89 $ 3,239.84 $ 138,391.36
14 11/1/2016 $ 138,391.36 $ 21,564.72 $ 20.00 $ 18,683.35 $ 2,861.37 $ 119,708.01
15 5/1/2017 $ 119,708.01 $ 21,564.72 $ 20.00 $ 19,069.65 $ 2,475.07 $ 100,638.36
16 11/1/2017 $ 100,638.36 $ 21,564.72 $ 20.00 $ 19,463.93 $ 2,080.79 $ 81,174.43
17 5/1/2018 $ 81,174.43 $ 21,564.72 $ 20.00 $ 19,866.37 $ 1,678.35 $ 61,308.06
18 11/1/2018 $ 61,308.06 $ 21,564.72 $ 20.00 $ 20,277.12 $ 1,267.60 $ 41,030.94
19 5/1/2019 $ 41,030.94 $ 21,564.72 $ 20.00 $ 20,696.37 $ 848.35 $ 20,334.57
20 11/1/2019 $ 20,334.57 $ 20,775.01 $ 20.00 $ 20,334.57 $ 420.44 $ 0.00
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