CR 93-193 - Loan Agreement - Minnehaha Oaks Assosciation
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November 8, 1993 o p ~ Council Report 93~193
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LOAN AGREEMENT - MINNEHAHA OAKS ASSOCIATION
ProDosed Action.
Staff recommends adoption of the . following motion: Move to
approve amendments to the loan'aqreement and related documents
pertaining to the purchase of the propertv known as the Hiawatha
Oaks~ and authorize the Mayor and ci ty Manager to execute 'said
documents.
overview
On October 19 the city council directed staff to prepare an
amendment to the loan agreement between the Minnehaha Oaks
Association, four homeowners, and the City of Hopkins, to alter
the terms of the loan by eliminating the 8% interest rate on the
loan. In addition, the City Council adopted a resolution which
approved an assessment roll based on a principal only loan with
the understanding that the Association and homeowners were
required to execute the amended loan agreement by November 17 in
order to avoid having an assessment roll certified to the County
based upon .the original loan agreement. As a part of adopting
,. this resolution the City Council waived the $500 administrative
fee, as outlined in the assessment agreement, for the assessment
proposed to be certified to the County.
The City Attorney has prepared amendments to the loan agreement
and related documents to take into consideration the City
Council's action as well as to clarify other miscellaneous items
within the agreements. On .October 29 city staff mailed the
amended loan agreements to the Association' and homeowners for
their review and comment. As of November 10 the city of Hopkins
has received no final confirmation from the Association or
homeowners as to the acceptability of the documents.
primary Issues to consider
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0 What are the specifics of the amendments to the. loan
documents?
SUDportinq Documents
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0 original and proposed)
. Thomas .K. J.ng
'" community Development Director
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CR93-193
Page 2
. primary Issues to Consider
0 What are the specifics of the amendments to the loan
documents? ~
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Although the amendments to!the loan documents are generally
self explanatory, what follows is a summary of the changes
made:
- Amendment to the loan agreement to provide for a
principal only loan of $175,000 to be paid in 15 equal
annual installments in the amount of $~1,666.67 with
each payment due on September 1, beginning in 19.93 and
concluding in 2007.
- Clarification that at such time assessments are levied
due to a payment default, that the interest rate on the
assessment shall be at the rate of 8%.
- Clarifies a provision in the existing loan agreement
pertaining to providing a release to a homeowner from
the provisions of the loan agreement in the event the
homeowner has made payment to the City of their share
of the obligation for the remaining balance of the
entire loan.
. - Indication that the City waives the $500 administrative
fee with respect to the assessment to be levied in 1993
and due and payable in 1994. However, the provision
does not waive the $500 administrative fee for
potential future assessment rolls which may be adopted.
- Clarifies the fact that the homeowners consent and
agree that the city may levy against their property the
special assessment which relates to the delinquent
amount owed the City.
- Clarifies matters relative to the property owned by
Ibsens and Strom relative to the fact that Strom bought
the property from Ibsens with a contract for deed.
Language was added to insure that both the Strom and
Ibsen property were subjected to the terms of the loan
agreement.
- Clarifies that the original promissory note which was
signed by the Minnehaha Oaks Association is canceled
and is replaced with a new promissory note, a copy of
which is attached.
- Undertakes other minor clarifications or provisions to
the loan agreement.
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CR93-193
Page 3
Alternatives .
0 Approve the action as recommended by staff.
0 Approve the action as recommended by staff with other
changes to the loan documents. Please note that the
Minnehaha Oaks Association and homeowners will not have
had a chance to review and discuss these changes.
0 Deny the action as recommended by staff. Unless other
actions were taken this action would appear to result
in the full assessment relating to a principal and
interest loan being assessed against the homeowners.
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LOAN AGREEMENT
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This Agreement is made on the ~ day of November,
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1992 by and among the City of Hopkins, a municipal
corporation ("City" ), Minnehaha Oaks Association, a nonprofit
corporation ("Association") and those homeowners who have
signed !3-nd otherwise executed this agreement, (collectively
referred to as' "Homeowners"):
RECITALS:
1. City is a municipal corporation created by Charter
possessing all of the powers of a municipality.
2. Association is a nonprofit corporation composed of
members residing on Hiawatha Avenue within the City.
. 3. Homeowners own and occupy certain single family
residences located on Hiawatha Avenue within the City and as
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' , such are members of the Association.
4. Pursuant to and in reliance . upon a Special
Assessment Agreement dated April 15, 1992, between City,
Association and Homeowners, the City was induced to acquire
certain undeveloped property lying adjacent to and west of
~ Hiawatha Avenue form Mark Z. Jones II consisting of
approximately 1.54 acres of forested land which all parties
desired be preserved for passive park and nature area
purposes.
5. The City has expended the sum of One Hundred
Eighty-Five Thousand Dollars ($185,000.00) in the acquisition
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of said property and Association and Homeowners wish to
reimburse City to the extent of the acquisition costs of One .
Hundred Eighty-Five ~housand Dollars ($185,000.00).
6. The City acknowledges receipt of 'Ten Thousand
Dollars ($10,000.00) paid to City by Association.
7. All parties desire that the terms of the Assessment
Agreement dated April 1~, 1992 be modified and adjusted to
provide for payment by loan terms while retaining the rights
of assessment by City for purposes of security in event of
default in any of the terms of the Loan Agreement.
NOW THEREFORE in consideration of the mutual benefits
set forth.
PAYMENT TERMS:
1. As~ociation shall pay. to the City the sum of One
Hundred Seventy-Five Thousand Dollars ($175,000.00) with .c
interest thereon at eight percent (8%) per annum payable in
fifteen (15) equal annual payments of Twenty Thousand
Sixty-eight . and 80/100 Dollars ($20,068.80) commencing on
September 1, 1993 and on the first day of each annual
anniversary date thereafter. Such annual payments shall be
- inclusive of and applied first upon the accumulated interest
and thereafter upon the principal balance remaining. Said
interest on the principal balance shall commence on November
1, 1992.
2. ,Association may prepay the principal balance in
full or in partial prepayment of not less than Five Thousand
Dollars ($5,000.00) at ~ts option without penalty. .
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SECURITY PROVISION:
1. It is understood and agreed by all parties to this
. Agreement that the security of the City to enforce compliance
with the installment payments due herein is the initiation of
special assessment procedure in conformance with the terms of
this Agreement -which security sha:l:l remain in full force and
effect applicable to all of the parcels described in Exhibit
A (attached) until receipt of final payment by the City or
upon lease from said assessment of one or more such parcels
at the option of the City. .'
2. The Association shall be obliged to collect and
receive payments from its members who are or shall become
parties to this Agreement ,or from such other sources
available to the Association and pay such sums to the City as
. provide for herein.
3. In the event of a default in any of the terms and
conditions provided for in this Agreement and. which remains
uncured for a period of 20 days, the City at its option shall
implement spec;Lal assessment proceedings and assess the
delinq'uent balance then due and payable to the City in equal
- proportion against each of the properties described on
Exhibit A. The resolution adopted by the City to levy such
special assessment shall be certified to the Hennepin County
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Auditor by November 30 for inclusion on the real estate tax
statement of each such parcel for the year following the
assessment certification.
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PAYMENT UPON DEFAULT:
1. The terms of the assessment thus levied upon and in .
the amount of the default shall be for a term of one year
with interest thereon at the rate of eight percent (8%) per
annum.
2. Prepayment terms .' following certificate of the
assessment shall be as provided in Minnesota.Statute 429 as
follows:
The homeowner of a property so assessed may at any
time prior to certification of the assessment to 'the
Hennepin County Auditor or prior to the first
installment of the assessment to the County Auditor
pay the whole of the assessment with interest accrued
to the date of payment. No further interest shall be
charged on the amount. assessed if the entire
assessment is paid within 30 days from the adoption of
the assessment.
3. In the event of default, the amount to be assessed .
in addition to the delinquent installment shall be increased
by additional costs, expenses and attorney fees incurred by
the City which all parties agree shall be the sum of Five
Hundred Dollars ($500.00) for each such assessment
certification.
4. For purpose of illustration ahd example only, a
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delinquency in the annual installment would be levied by
assessment and certified to Hennepin County pro rata (in
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. equal amounts) upon the tax statement of each property owned
by a homeowner who is a party to this Agreement includ~ng the
amount provided for additional costs, expenses and attorney
fees. Thereafter, prepayment would be limited in the manner .
provided in Paragraph 2. If the assessed amount matures
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without payment, the City would have the option to commence
. foreclosure proceedings and acquire the property in the
manner provided by law. This Agreement contemplates the
possibility that a subsequent purchaser would insist the pro
rata share of the delinquent amount assessed against such a
parcel be' paid off in which event the City would furnish the
homeowner a release from the assessment lien. Upon receipt.
of the pro rated assessment, the property thus released would
no longer be subject to the terms of this Agreement~
WAIVER OF STATUTORY RIGHTS: ."
In order to induce the City to rely on voluntary
repayment by Association and Homeowners as herein provided
and utilize the assessment procedure only in the event of a
default in tlle payment of such" installments, each of the
. parties to this Agreement jointly and individually agree to
waive all objections or irregularities regarding imposition
of the assessment procedure outlined in this Agreement and
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without limitation expressly include the following:
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a. Waiver of right to a notice of assessment except and to
the extent notice of such assessment is provided for in
..- this Agreement;
b. Waiver of obligation to such assessment by the parties
:- to be assessed;
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c. Waiver of rights to appeal such assessment herein
agreed to;
d. Waiver of right to object to the assessment le.vy
provided for in this Agreement upon any ground
including but not limited to excessiveness of such
assessment.
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OBLIGATION OF ASSOCIATION:
1. The Association shall be obliged to ,collect and
receive payments from its members .who are or... shall become
parties to this Agreement sources
available to the Association and pay such. sums .to the City as
provided for in this Agreement and to otherwise enforce
individual compliance of its member Homeowners with all of
the terms of this Agreement. Provided, however, the City may
release one or more parcels
upon the mutual consent of all other Homeowners who are then
parties to this Agreement.
2. It shall be the obligation of the Association to
maintain and provide for reasonable times
proper books and records disclosing the receipt and source of .
all payments obtained by the Association.
MISCELLANEOUS PROVISIONS:
1. The provisions of this Agreement shall govern over
any other contrary term, condition or provision contained in
any prior Agreement or understanding among the parties
whether expressed verbally or in writing.
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2. This Agreement shall be binding and inure to
the ,benefit as well as the obligation.of
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their successors, representatives and assigns including
without limitation any successor by purchase, transfer or
conveyance of anyone or more of the properties described on
Exhibit A. .
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IN WITNESS WHEREOF, the parties have caused this
. Agreement to be executed on the day and year first above
written.
CITY OF HOPKINS
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MINNEHAHA OAKS ASSOCIATION
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HOMEOWNERS
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Irene Ibsen, (Address) I
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Kenneth Ibsen, (Address)
Patricia Isaak, (Address)
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State of Minnesota)
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County of Hennepin)' .
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~~ foregoing instrument was acknowledged before me
this day .~f }liD V<""b.tr , 1992 by r'J.~(s,,~ t)f3
and $-hvel'1 M'4..1 ke... ' the M ~t"r '
and (..:+ MM(/.~(" of the City ofHo kins, a municipal
corporatlon under the laws of Minnesota, On behalf of the
City.
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Notary Publi ' '
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State of Minnesota) e Patdd' J. Gt,borne
o ) ss '~.~ NOTARY PUBLIC - MINNESOTA
County of Hennepin) , ,!~'" HENNEPIN COUNTY
;~:':'t.; My commission expires 6-1-93
instrument
this .
and
and
Asscciat of
Minnesota .
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e DEBORAH A. McCOWAN ~~ .QIft '
, 'NOTARY PUIlUC -M'NNESOTA a-
, ,-' HENNEPIN COUNTY
.' " ' ,,' My cemmlaalon expires 12~ 1-93 Notary Public -
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State of Minnesota)
) ss
County of Hennepin)
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The foregoing instrument was acknowledged before 'me
this .;:t 1'1'" day 0 of 11 6 L7 {'~ ".... /J;-e .,..r- I 1992 by Marie McNeff and
Larry McNeff.
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'State of Minnesota)
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County of Hennepin)
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Th~fOregOing instrument was acknowledged before me
this <X day of -1\,~ ba_h , 1992 by Malora Carlson and
Joey Carlson.
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e DEBORAH A. McGOW.;"
, \. _ .. NOTARY PUBUC'. MINNESOTA; <9d~
.. -/ HENNEPIN COUNTY ) Notary P~blic
'..." . ' My commission expires 12-1-93 (
~ State r o~ ~rnne~b't1!")-"
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County of Hennepin}
The foregoing instrument was acknowledged before me
this .;;;.1- r-t-, day. of tfl~ , 1992 by Irene Ibsen and
Kenneth Ibsen. tk.0'1&:!lJt :6-91
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State of Minnesota)
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. County of Hennepin}
The foregoing . instrument acknowledged before me
was
this day of , 1992 by Patricia Isaak and
Vernon Isaak.
Notary Public
State of Minnesota}
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County of Hennepin}
- The foregoing instrument was acknowledged before me
this ~ 5- day of ~':I 'y.' e .;~ b~. r-- , 1992 by Edward Strom.
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EXHIBIT A .
1. Marie McNeff and Larry'McNeff, 413 Hiawatha Avenue,
Hopkins, Minnesota:
.Tract A Registered Land Survey No. #825
2. Patricia Isaak and Vernon Isaak, 434 Hiawatha Avenue,
Hopkins, Minnesota:
Lot 12 ,Block 1, Minnehaha Oaks
3. Malora Carlson and Joey Carlson, 435 Hiawatha Avenue,
Hopkins, Minnesota:
Tract A Registered Land Survey #362 .
4. Edward Strom, 505 Hiawatha Avenue, ,Hopkins, Minnesota:
That part, of Lots 2, 3 and 4 lying south of the line running
east at right angles from the west line of Lot 2 at a point
distant 90 feet south from the northwest corner thereof and .
north of a line running east at right angles from the west
line of Lot 3 at a point distant 50 feet south from the
northwest corner thereof Lots 2, 3 .and 4, Block 1, Minnehaha
Oaks
5. Irene Ibsen and Kenneth Ibsen, 511 Hiawatha Avenue,
Hopkins, Minnesota:
That Part of Lots 1, 2, 3 and 4 lying ~outhwesterly of creek
south of a line running east at right angles from the west
line of Lot 1 at a point distant 10 feet north from the most
- southerly corner thereof and north of a line running east at
right angles from the west line of Lot 2 at a point distant
90 feet south from the northwest corner thereof Block 1,
Minnehaha Oaks ~
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hereby
sum of One Hundred Seventy:-five Thousand Dollars'($175~OO.00)
1. $20,068.80
September 1,
first day
thereafter
Full
Borrower at its option without penalty; partial prepayment of
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less Five Thousand Dollars ($5,000.00)
at the option of Borrower without penalty.
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The Holder may at its option, upon 20 days' notice,
declare an installment . immediately due and payable for the
entire unpaid principal hereof, plus accrued and
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interest hereon, and any other amounts due and owing
hereunder, upon or any time after the occurrence of any of tit
the following events:
1. Any default upon the payments of or obligations under
this Note;
2. Any default under the. terms or conditions of that
certain Loan Agreement dated November 17, 1992 to which
the Borrower is a party, or any default under any
agreement, obligation, instrument, or undertaking
related thereto.
It is agreed that time is of the essence in the
performance of this Note.
Upon the occurrence of any event of default hereunder
and if the Note is referred to any attorney for collection or
any action at law or in equity is brought with respect
hereto, Borrower shall pay Holder all reasonable expenses and _.
costs of collection, including, but not limited to,
reasonable attorneys fees.
Borrower, all guarantors, and all other persons liable
for all or any part of the indebtedness evidenced by this
Note severally waive presentment for payment, protest and
notice of nonpayment and dishonor. From time to time,
- without affecting the obligations of Borrower under this
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Note, and without affecting the guarantee of any person,
corporation, or other entity for payment of the i~debtedness
evidenced by this Note, and without giving notice to or
obtaining the consent of Borrower or such guarantors, and
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without liability on the party of Holder, Holder may, at its
option, extend the time,for payment of the sums due under ~
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this Note, accept a renewal of the Note, modify the terrr.s and
- times of payment of the indebtedness evidenced by this Note,
- join in any extension or subordination agreement, release any
security given here for , take or release other or additional
security, and agree in writing with Borrower to modify the
rate of interest or period of amortization of this Note or
change the amount of the annual installments payable
hereunder.
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No delay or omission on the part of Holder in
exercising any right hereunder shall operate as a waiver of
such right or of any other remedy under this Note. A waiver
on any one occasion shall note be construed as a bar to or
waiver of any such right or remedy on a future occasion. The
remedies of Holder, as provided herein and in the related
. documents, shall be cumulative and concurrent and may be
pursued singularly, successively, or together at the sole
di.scretion of the Holder and may be exercised as often as the
occasion therefore shall arise.
MINNEHAHA OAKS ASSOCIATION
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GUARANTY .
THIS GUARANTY, made and entered into this 17th day of
November, 1992 by Marie McNeff, Larry McNeff, Malora Carlson,
Joey Carlson, . Irene Ibsen, Kenneth Ibsen, Patricia Isaak,
Vernon Isaak and. Edward S tro'm ("Guarantorsll), to City of
Hopkins, a municipal corporation ("Obligee").
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WITNESSETH
WHEREAS, Minnehaha Oaks Association, a nonp;rofit
corporation ( "Ob1igor'1) hC'.s entered into a Lean Agreement
dated November 17, 1992 ("Agreement") pursuant to the terms
of which Obligee acquired certain land for the sum of One
Hundred Seventy-five Thousand Do11,ars ($175,000.00) at the
direction and , request of said Obligor and Guarantors in .
exchange for a Promissory Note bearing even date herewith
from Obligor in the principal amount of One Hundred
Seventy-five Thousand Dollars ($175,.000.00) ( "Note"); and
WHEREAS, Guarantors are members of said Obligor; and
WHEREAS, in order to induce Obligee to accept the Note,
and as security for the Note, the Guarantors have agreed to
give this Guaranty.
NOW, THEREFORE, in consideration of the foregoing, the
Guarantors hereby agree and covenant with the Obligee as
follows:
1. The Note is hereby made a part of this Guaranty by
reference thereto with the same force and effect as if fully -
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set forth herein. I
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2. The Guarantor hereby unconditionally, and absolutely
. guarantees to Obligee the due and prompt payment, and not
just the collectability, of the principal and interest and
all other indebtedness, if any, , on the Note and all costs
incurred including reasonable attorney's fees, in enforcing
the payment and collection of the Note ("Indebtedness
Guaranteed") when due whether at maturity, by acceleration or
otherwise all at the times and places and at the rates
described in, and otherwise according to the terms of the
Note.
3. The Guarantor hereby agrees that the Obligee may
from time to time without notice to or consent of the
Guarantor and upon such terms and conditions as the Obligee
may deem advisable without affecting this Guaranty (a)
. release any maker, surety or other person liable for payment
of all or any part of the Indebtedness Guaranteed; (b) make
any agreement extending or otherwise altering the tme for or
the terms of payment of all or any part of, the Indebtedness
Guaranteed; (c) modify, waive, compromise, release,
subordinate, resort to, exercise or refrain from exercising
any right the Obligee may have hereunder, under the Note; (d)
accept additional security or guarantees of any kind; (e)
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endorse, transfer or assign the Note to any other party; (f)
accept from Obligor or any other party partial payment or
payments on account of the Indebtedness Guaranteed; (g)
release, settle or compromise any claim of the Obligee
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against the Obligor, or against any other person, firm or .
corporation whose obligation is held by the Obligee as
collateral security for the Indebtedness Guatanteed.
4. The Guarantor hereby unconditionally and absolutely
waives (a) any obligation on the part of the Obligee to
protect, secure or insure any of the security given for
t~epayment of the Indebtedness Guaranteed; (b) ~he invalidity
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or unenforceability of the Indebtedness Guaranteed; (c)
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notice of acceptance of this Guaranty by the Obligee; ( d)
notice of presentment, demand for payment, notice of
nonperformance, protest, notices of protest and notices of
dishonor, notice of nonpayment or partial payment; (e) notice
of any defaults under the Note or in performance of any of
the covenants . and agreements contained therein given as .
security for the Note.
5. No right or remedy herein conferred upon or
reserved to the Obligee is intended to be exclusive of any
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other available remedy or remedies but each and every remedy
shall be cumulative and shall be in addition to every other
remedy given under this Guaranty or now or hereafter existing
at law or in equity except to the extent that Obligee's
remedy pursuant to this Guaranty shall be limited to and
applied in equal proportion among the Guarantors. It is
further understood that Obligee's remedy under this Guaranty
shall be secondary to all other remedies of Obligee and
pursued only in event of the inadequacy or unavailability of -
the remedy of assessment. No waiver, amendment, release or .-=-
modification of this Guaranty shall be established by
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conduct, custom or course of dealing, but only by an
. instrument in writing duly executed by the Obligee.
6. This Guaranty is delivered in and made in and shall
in all respects be construed pursuant to the laws of the
State of Minnesota.
7. This Guaranty, and each and every part hereof,
shall be binding upon the Guarantor and upon their
successors, assigns, heirs and legal representatives and
shall inure. to the benefit of each and every future holder of
the Note, including the successors and assigns of the
Obligee.
IN WITNESS WHEREOF, The Guarantors have executed their
Guaranty as of the day and year first above written.
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Mar'e McNeff
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Malora Carlson
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Irene Ibsen
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Kenneth Ibsen .
Patricia Isaak
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AMENDMENT TO LOAN AGREEMENT
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This Amendment to Loan Agreement (this "Amendment") is made
and entered into effective as of the 19th day of October, 1993 by
and between the City of Hopkins, a Minnesota municipal corporation
(the "City"), Minnehaha Oaks Association, a Minnesota non-profit
corporation (the "Association") and Marie McNeff f. Larry McNeff,
Malora Carlson, Joey Carlson, Irene Ibsen, Kenneth Ibsen and Edward
Strom (collectively referred to as the "Homeowners").
RECITALS
A. The City, the Association and the Homeowners are the
parties to that certain Loan Agreement (the "Loan Agreement ") dated
November 24, 1992, pursuant to which the Association agreed to pay
the City the sum of $175,000.00 together with interest thereon at
-. the rate of eight percent (8%) per annum in fifteen (15) equal
annual installments commencing September 1, 1993.
B. The City 'has agreed to modify the Loan Agreement to waive
interest and costs due thereunder as hereinafter specified on the
condition that the Association and the Homeowners execute this
AmendmEm t and agree. to the terms, covenants and conditions
hereinafter stated.
C. The parties are entering into this Amendment for the
purpose of setting. forth the terms and conditions of their
agreement to amend the Loan Agreement.
NOW, THEREFORE, in consideration of the foregoing and of the
terms, covenants and conditions of this Amendment, the City, the
. Association and the Homeowners agree as follows:
c: \ file \hopcivil\ amend,oak
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l. The following paragraph is hereby added to the "Recitals".. .
section of the Loan Agreement:
8 . The indebtedness secured by this Agreement repre-
sents the indebtedness due under a Promissory" Note, dated
November 17, 1992 (the "Note) , from the Association, as
Borrower, to the City, as Holder, in~he original principal
amount of One Hundred Seventy-five Thousand and no/l00ths
( $1 7 5 ,00 0 . 00 ) .
2. Paragraph 1 of the " PAYMENT TERMSI' section of the Loan
Agreement is hereby deleted and replaced with the following:
l. The Association shall pay to the City the sum of One
Hundred Seventy-five Thousand and no/lOOths Dollars
($175,000.00) in fifteen (15) equal annual installments~in the
amount of Eleven Thousand Six Hundred Sixty-six and 67/100ths
Dollars ($11,666.67), each, commencing September 1, 1993 and
continuing on the first day of September of each consecutive
year thereafter until September 1, 2007, on which latter date
the entire unpaid principal balance, if not sooner paid, shall
be due and payable in full.
3 . The word" lease" 'on the eighth line of Paragraph 1 of the
"SECURITY PROVISION" section of the Loan Agreement is hereby .~
changed to the word "release" .
4. Paragraph 3 of the "SECURITY PROVISION" section of the
Loan Agreement is hereby deleted and replaced with the following:
3. In the event of a default in .the payment of any of
the installments due to the City under.. this Agreement, which
defaul t remains uncured for a period of twenty (20) days after
the date on which such installment was due, the City, at its
option, shall implement special assessment proceedings and
assess the delinquent installment then due to the City in
equal proportion against each of the parcels described on
Exhibit A hereto. The resolution adopted by the City to levy
such special assessment shall be certified to the Hennepin
County Auditor by November 30 for inclusion on the real estate
tax statement of each such parcel for the 'year following the
assessment certification.
5. Paragraph 1 of the "PAYMENT UPON DEFAULT" section of the
Loan Agreement is hereby deleted and replaced with the following:
.
c: \file \hopcivi I\amcnd .oa k 2
"
1. All assessments levied under paragraph 3 of the
. "SECURITY PROVISION" section of this Loan Agreement shall bear
interest at the rate of eight percent (8%) per annum from and
after the first day of November of the year in which such
assessment was levied.
6. The last two sentences of Paragraph 4 of the "PAYMENT
UPON DEFAULT" section of the Loan Agreement are hereby deleted and
replaced with the following:
The City shall release, by a written Release in recordable
form, any of the parcels described in Exhibit A to this
Agreement from the obligations created by this Agreement upon
payment to the City by the owner of such parcel of' an amount
equal to one-fourth (1/4) of the then unpaid principal amount
due under this Agreement and the Note.
7. With respect to the assessment to be levied in 1993 due
and payable in the year 1994, the City hereby waives the Five
Hundred and no/100ths Dollars ($500.00) amount to be added to the
assessment against each of the properties described in Exhibit A to
'. the Loan Agreement for the City's costs, expenses and attorneys'
fees.
8. Each of 'the undersigned Homeowners hereby consents and
agrees that the City may levy against each of the Homeowners'
parcels of land the special assessments in the amount and on the
terms described in Exhibit A to this Amendment. Said Assessments
represent each of the described parcels' proportionate share of the
installment due September 1, 1993 and shall be due and payable in
the year 1994.
9 . The obligations created by the Loan Agreement and this
;r.
Amendment shall run with the title to each of the parcels of land
described in Exhibit A hereto and shall be binding upon all of the
. successors and assigns of the Homeowners. The Loan Agreement and
c:\fi Ie \hopcivi 1\ amend .oak 3
(, "
this Amendment shall be recorded against the record title of each .
of the parcels of land described in Exhibit A hereto for the
purpose of giving subsequent purchasers and encumbrancers notice of
the terms, conditions and obligations created by the Loan Agreement
and this Amendment.
10. Irene Ibsen and Kenneth Ibsen are executing this
Amendment as the fee owners of Parcels 3 and 4, as described in
Exhibit A hereto, and Edward Strom is signing this Agreement as the
Contract for Deed Purchaser of Parcel 4, as described in Exhibit A
hereto, for the purpose of subjecting both Parcel 3 and Parcel 4 to
the terms, conditions and obligations created by the Loan Agreement
and this Amendment.
11. The Promissory Note dated November 1 7 , 1992, which is
secured by the Loan Agreement, has been cancelled and replaced with .
a Promissory Note dated October 19, 1993 (the "Replacement Note"),
in the original amount of One HUI:1dred Seventy-five Thousand and
nO/100ths Dollars ($175,000.00), from the Association, as Borrower,
'to the City, as Holder. The Loan Agreement and this Amendment
secure the indebtedness evidenced by the Replacement Note. All
references in the Loan Agreement or this Amendment to the Note
shall hereinafter be deemed to refer to the Replacement Note.
12. Exhibit A to the Loan Agreement is hereby replaced with
Exhibit A attached to this Amendment and incorporated herein by
reference.
13. The City, the Association and the Homeowners hereby
restate and reaffirm the Loan Agreement in all of its terms,
.
c:\fi Ie \ hopcivil\amend.oak 4
.- .
. .
covenants and conditions and agree that the Loan Agreement shall
. remain in full force and effect, as modified by this Amendment.
IN WITNESS WHEREOF, the undersigned parties have executed this
Agreement effective as of the date and year first above written.
CITY OF HOPKINS
By
Its Mayor
By
Its City Manager
MINNEHAHA OAKS ASSOCIATION
'.
By
Its President
By
Its Vice President
HOMEOWNERS
Marie McNeff
Larry McNeff
.
c: \fiIe \ hopcivi I\amend,oak 5
..... :::s:
Malora carlson.
Joey Carlson
Irene Ibsen
Kenneth Ibsen
Edward Strom
STATE OF MINNESOTA )
)SS
COUNTY OF HENNEPIN ) 4It~
The foregoing instrument was acknowledged before me this ____
day of , 1993, by , the
Mayor, of the City of Hopkins, a municipal corporation under the
laws of Minnesota, on behalf of the City.
Notary Public
STATE OF MINNESOTA )
)SS
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this ____
day of , 1993, by , the
Ci ty Manager, of the City of Hopkins, a municipal corporation under
the laws of Minnesota, on behalf of the City.
Notary Public
.
c:\file\hopcivil\amend.oak 6
" .
. STATE OF MINNESOTA )
)SS
COUNTY OF HENNEPIN )
The foregoing instument was acknowledged before me this ____
day of , 1993, by , the
President of Minnehaha Oaks Association, a non-profit corporation
under the laws of the State of Minnesota, on behalf of the
corporation.
Notary Public
STATE OF ,MINNESOTA )
)SS
COUNTY OF HENNEPIN )
The foregoing instument was acknowledged before me this ____
day of , 1993, by , the
Vice President;. of Minnehaha Oaks Association, a non-profit corpora-
tion under the laws of the State of Minnesota, on behalf of the
corporation.
'.
Notary Public
STATE OF MINNESOTA )
)SS
COUNTY OF HENNEPIN )
The foregoing instument was acknowledged before me this ____
day of , by Marie McNeff and Larry McNeff.
Notary Public
.
c: \fiIe \ hopcivi l\amend ,oak 7
(~ 0
STATE OF MINNESOTA ) .."
)SS
COUNTY OF HENNEPIN )
The foregoing instument was acknowledged before me this
day of , by Malora Carlson and Joey Carlson:--
Notary Public
STATE OF MINNESOTA )
)SS
COUNTY OF HENNEPIN )
The foregoing instument was acknowledged before me this ____
day of , by Irene Ibsen and Kenneth Ibsen.
Notary Public
STATE OF MINNESOTA )
)SS .
COUNTY OF HENNEPIN ),:
The foregoing instument was acknowledged before me this
day of , by Edward Strom. ----
Notary Public
This Instrument was drafted by:
Vesely, Miller & Steiner
400 Norwest Bank Building
1011 First Street South
Hopkins, Minnesota 55343
'.
c:\file\hopcivil\amcnd.oak 8
.-
. EXHIBIT A TO AMENDMENT TO LOAN AGREEMENT
Parcel 1 Owners: Marie McNeff and Larry McNeff
Address: 413 Hiawatha Avenue
Legal Description: Tract A, Registered Land Survey No.
825, Hennepin County, Minnesota.
P.LD. #19-117-21 12 0019 ;1" <=\ (1I. (,1 .
Special Assessment Payable in 1994: $.3 , 0 41. 6 7
Parcel 2 Owners: MaloraCarlson and Joey Carlson
Address: 435 Hiawatha Avenue
Legal Description: Tract A Registered Land Survey No.
362, Hennepin County, Minnesota.
P.I.D. #19-117-21 12 0015 ~ q(~. ~j
Special Assessment Payable in 1994:. $3',011.6-7
Parcel 3 Owners: Irene Ibsen and Kenneth Ibsen
Address: 511 Hiawatha Avenue
Legal Description: That part of Lots 1, 2, 3 and 4 lying
Southwesterly of creek South of a line running East at
right angles from the West line of Lot 1 at a point
distant 10 feet North from the most Southerly corner
thereof and North of a line running East at right angles
from the West line of Lot 2 at a point distant 90 feet
South from the Northwest corner thereof, Block 1,
.. Minnehaha Oaks, according to the recorded plat thereof,
Hennepin County, Minnesota.
P. I .D. #19-117-21 12 0005 ~ <tt(Q.("
"
Special Assessment Payable in 1994: $3 , 0 11. 6 T
Parcel 4 Fee Owner: Irene Ibsen and Kenneth Ibsen
Contract Purchaser: Edward Strom
Address: 505 Hiawatha Avenue
Legal Description: That part of Lots 2, 3 and 4 lying
South of a line running East at right angles from the
West line of Lot 2 at a point distant 90 feet South from
the .Northwest corner thereof and North of a line running
East at right angles from the West line of Lot 3 at a
point distant 50 feet South from the Northwest corner
thereof Lots 2, 3 and 4, Block 1, Minnehaha Oaks,
according to the recorded plat thereof, Hennepin County,
Minnesota.
P.LD. #19-117-21 12 0006 a, <ll <.t. ~...,
Special Assessment Payabl~ in 1994: $3,041.G7
.
c: \ file \ hopcivi 1\ cxhibita.oak
,~ v
. @illDJ ~
U
PROMISSORY NOTE
. $175,000.00 Hopkins, Minnesota
October 19, 1993
FOR VALUE RECEIVED, the undersigned MINNEHAHA OAKS ASSOCIA-
TION, . a nonprofit corporation ( "Borrower" ) , . hereby agrees and
promises to pay to the order of the CITY OF HOPKINS, a municipal
corporation ( "Holder") at 1010 First Street South, Hopkins;
Minnesota 55343 or such other place as Holder, or its assign(s),
may from time to time designate, the principal sum of One Hundred
Seventy~five Thousand Dollars ($175,000.00).
This Note is payable in consecutive annual installments in the
amount of Eleven Thousand Six Hundred Sixty-six and 67/100ths
Dollars ($11,666.67), each, commencing September 1, 1993 and
.. continuing on the first day of September of each consecutive year
thereafter until September 1,2007, on which latter date the entire
unpaid principal balance, if not sooner paid, shall be due and
payable in full. This Note may be prepaid in full, at any time,
'without penalty.. In addition, partial prepayments of not less than
Five Thousand and no/100ths Dollars ($5,000.00) may be made at any
time, without penalty.
The indebtedness evidenced by this Note is secured by a Loan
Agreement dated November 24, 1992 (the "Loan Agreement") and an
Amendment to Loan Agreement dated of even date herewith (the
"Amendment"). Upon the occurrence of a default in the payments due
under this Note, or a default by Borrower in the performance of the
terms and conditions of the Loan Agreement or Amendment, Holder
. shall be entitled to initiate proceedings to recover the full
c: \ fi Ie \ hopcivi '\ note.oak
amount of any delinquent insta.llments due under this Note from the .
Borrower, together with interest at the rate of eight percent (8%)
per annum from and after the date on which such delinquent
installment was due, upon twenty (20) days' written notice to
Borrower. In addition, Holder may pursue any and all of its
remedies under the Loan Agreement and the Amendment, which remedies
shall be in addition to and not in limitation of Holder's remedies
under this Note.
It is agreed that time is of the essence in the performance of
this Note.
Upon the occurrence of any event of default hereunder and if
the Note is referred to any attorney for collection or any action
at law or in equity is brought with respect hereto, Borrower shall
pay Holder all reasonable expenses and costs of collection, .~
including, but not limtied to, reasonable attOrneys' fees.
Borrower, all guarantors and all other persons liable for all
or any part of the indebtedness evidenced by this Note severally
.waive presentment for payment, prbtest and notice of nonpayment and
dishonor. From time to time, without affecting the obligations of
Borrower under this Note, and without affectin~ the guarantee of
any person, corporation, or other entity for payment of the
indebtedness evidenced by this Note, and without giving notice to
or obtaining the consent of Borrower or such guarantors, and
without liability on the part of Holder, Holder may, at its option,
extend the time for payment of the sums due under this Note, accept
a renewal of the Note, modify the terms and times of payment of the
indebtedness evidenced by this Note, join in any extension or .
c: \ fi Ie \ hopcivi/\ note.oak 2
~,"""'_,_"""""",,,, ... '"C....b..;_.."..,,"=--._.~","-~, ~- ~~,....
.
,
~.
subordination agreement, release any security given herefore, take
. or release other or additional security, and agree in writing with
BO,rrower to modify the rate of interest or period of amortization
of this Note or change the amount of the annual installments
payable hereunder.
No delay or omission on the part of Holder in exercising any
right under this Note, the Loan Agreement or the Amendment
hereunder shall operate as a waiver of such right or of any other
remedy under this Note. A waiver on anyone occasion shall not be
construed as a bar to or waiver of any such right or remedy on a
future occasion. The remedies of Holder, as provided herein and in
the Loan Agreement and the Amendment, shall be cumulative and
concurrent and may be pursued singularly, successively or together
. at the sole discretion of the Holder and may be exercised as often
as the occasion therefore shall arise.
MINNEHAHA OAKS ASSOCIATION
By
Its President
By
Its Vice President
.
c: \ file \hopcivi I\note,oak 3
t3 "\
UD u~ ill r2 SrJ
lj 11 ..j UJ U
CONSENT
.
Each of the undersigned Guarantors, as pa~ties to that certain
Guaranty, dated November 17, 1992(the "Guaranty" ) , between the
undersigned and the City of Hopkins guaranteeing the obligations of
Minnehaha Oaks Association under a Promissory Note (the "Note"),
dated November 17, 1992, from Minnehaha Oaks !\ssociation, as
Borrower, to the City of Hopkins, as Holder, in the original
principal amount of $175,000.00, hereby consent and agree' to all of
the terms, covenants and conditions of the following documents:
1. That certain Amendment to Loan Agreement dated October
19, 1993, amending the terms and conditions of the Loan
Agreement, dated November 24, 1992, by and between the
City of Hopkins, Minnehaha Oaks Association and the
undersigned Guarantors.
2 . The Promissory Note, dated October 19, 1993 (the "Re-
,. placement Note") , from Minnehaha Oaks Association, as
Borrower, to the City of Hopkins, as Holder, in the
original principal amount of $175,000.00 replacing the
Note.
Each of the undersigned Guarantors hereby agrees that the Guaranty
shall remain in full force and effect in all of its terms,
covenants and conditions, shall app~y fully to the Replacement Note
and that all references in the Guaranty to the Note shall be deemed
to refer to the Replacement Note. The undersigned Guarantors
further agree that all references in the Guaranty to "the
Guarantor" shall be deemed to refer to all of the undersigned
Guarantors.
IN WITNESS WHEREOF, the undersigned Guarantors have executed
this Consent effective as of October 19, 1993.
.
c: \ file \hopcivi 1\ consent.oak
OJ;' ..
~----, ._.~
~
.
~
Marie McNeff .
Larry McNeff
Malora Carlson
Joey Carlson
Irene Ibsen
Kenneth Ibsen .
:
Edward Strom
'.
c: Vi Ie \hopcivi J\consen t.oak 2
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