HomeMy WebLinkAboutM-87-0371CITY OF MIAM1. FLORIDA
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INTER -OFFICE MEMORANDUM
The Honorable Mayor and
Members of the City Commission
FROM Cesar H. Odio
City Manager
DATE: February 17, 1987 FIL_:
SUBJECT: Proposed Loan to the
Coconut Grove Playhouse,
Inc.
REFERENCES:
ENCLOSURES:
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With respect to the proposed $200,000 City loan to the Coconut
Grove Playhouse, Inc. (CGP), please be advised that we have met
with a representative of the Playhouse on February 3, 1987, to
discuss our concerns regarding this matter.
The main obstacle from the outset of negotiations has been the
issue of sufficient collateral to secure the loan. The collateral
-pr-evious3y--suggested --(•accounts-• receivables and $10, 000 • in escrow) --
has been rejected by the City Manager and the City Commission.
It is understood that CGP does not possess sufficient assets to
fully collateralize this loan. Therefore, alternate methods of
protecting the City's investment could be considered.
CGP has agreed, subject to approval by its Board of Directors, to
change the collateral terms of the loan and is now :offering the
following as additional security:
1) An increase in the amount of funds held in escrow from $10,000
to'$25,000- ;
2) To have the City Commission appoint one City of Miami
representative to its current eighteen (18)-member Board of
Directors.
3) A ninety (go) -day call provision on the loan, i.e., to allow•
the City Commission to call the loan due and payable in ninety
(90) days for any reason, after prior notification to the CGP
Board of Directors of the reason for the action by the City
representative, and a thirty (30)-day period to satisfy the
City's request.
If these terms are satisfactory, we will proceed to get approval
from the CGP Board of Directors and finalize the -contract.