2021-053 - Approving A Loan in the Amount of $2,500,000 to PEDC, Approving a Promissory Note Regarding said Loan; Authorizing Mayor to Sign Note

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PROMISSORY NOTE Borrower: PARIS ECONOMIC DEVELOPMENT CORPORATION A Texas Non -Stock, Non -Profit Industrial Development Corporation 1125 Bonham Street, Paris, Texas 75460 Lender: THE CITY OF PARIS Principal Amount: $2,500,000.00 Initial Rate: _% Date of Note: NEED TO FILL IN PROMISE TO PAY. PARIS ECONOMIC DEVELOPMENT CORPORATION, A Texas Non - Stock, Non -Profit Industrial Development Corporation (Borrower), by and through its duly authorized Chairman of the Board of Directors, JOSH BRAY, promises to pay to the order of THE CITY OF PARIS (Lender), in lawful money of the United States of America, the principal amount of TWO MILLION FIVE HUNDRED THOUSAND AND NO/100 ($2,500,000) Dollars. PAYMENT. Borrower shall repay this Promissory Note, both principal and interest, by or before the tenth (10th) anniversary of date of said note asset forth hereinabove. For the first three years of this Promissory Note, Borrower make monthly payments in the amount of . During said three year period, interest will accrue at the rate of _%. On the third anniversary of the Date of Note, and on the 6' and 9' anniversary dates thereof, interest will be recalculated using the formula set forth herein below. Amortization of this ten (10) year Note will be calculated on a fifteen (15) year basis so that there will be a final payment in the principal amount of plus interest calculated at the then applicable interest rate. Unless otherwise agreed or required by applicable law, payments will be applied first to accrued unpaid interest, then to principal, and any remaining amount to any unpaid collection costs and late charges. Borrower will pay Lender at Lender's address shown above or at such other place as Lender may designate in writing. DETERMINATION OF INTEREST RATE. The interest rate on this note is determined periodically by a multistep process: (1) determine the current rate of return the City would receive if it invested in a Federal government agency bond (GNMAs or FMACs for examples) for the same time period as the note. (2) Subtract the rate determined above from the prime rate found in the Wall Street Journal. (3) Take 25% of the difference identified in #2 and add it to the rate of return determined in #1 above. (4) The result of the calculation in #3 will be the note interest rate. INTEREST CALCULATION METHOD. Interest on this Note is computed on a 365/360 basis; that is, by applying the ratio of the interest rate over a year of 360 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding. All interest payable under this Note is computed using this method. PREPAYMENT. Borrower agrees that all loan fees and other prepaid finance charges are earned fully as of the date of the loan and will not be subject to refund upon early payment (whether voluntary or as a result of default), except as otherwise required by law. Except for the foregoing, Borrower may pay without penalty all or a portion of the amount owed earlier than it is due. Early payments will not, unless agreed to by Lender in writing, relieve Borrower of Borrower's obligation to continue to make payments