H2. Res. 6158, MWED Loan Progran TransitionKALisPEii,
Development Services Department
201 1st Avenue East
Kalispell, MT 59901
Phone: (406) 758-7940
Fax: (406) 758-7739
www.kalispell.com/plannine
REPORT TO: Doug Russell, City Manager
FROM: Jarod Nygren, Development Services Director
SUBJECT: Development Services Loan Program Transition
MEETING DATE: September 5, 2023
BACKGROUND: Development Services currently manages a loan program utilizing both
Community Development Block Grant ("CDBG") and the United States Department of Agriculture
Office of Rural Development Intermediary Relending Program ("IRP") funds. During budget
preparation the desire to transfer the loan funds to Montana West Economic Development
("MWED") was discussed. MWED currently operates and oversees CDBG and IRP loan programs
and is experienced in working with and complying with the administrative requirements of State,
Federal, and community lending programs in Montana. Accordingly, the City and MWED desire to
enter into a mutually beneficial arrangement that enables MWED to expand its loan program
offerings in the City to benefit small business and eliminate duplication of services. As such, MWED
will provide services to the City related to the management and administration of the two City loan
programs.
The Council had a work session on August 14 regarding transition of the loan program and directed
staff to bring the item forward for their consideration.
RECOMMENDATION: It is recommended that Council make a motion authorizing the manager to
execute the Administrative Agreements with Montana West Economic Development for transfer of
the United States Department of Agriculture Office of Rural Development Intermediary Relending
Program ("IRP") funds and Community Development Block Grant Revolving Loan funds.
FISCAL EFFECTS: Approval of the recommendation would transfer $460,000.00 in IRP funds and
$180,000.00 in CDBG funds to MWED for their management and administration.
ATTACHMENTS: Resolution 6158
CDBG Administrative Agreement
IRP Administrative Agreement
City Loan Funds
c: Aimee Brunckhorst, Kalispell City Clerk
RESOLUTION NO. 6158
A RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE
ADMINISTRATIVE AGREEMENTS WITH MONTANA WEST ECONOMIC
DEVELOPMENT ("MWED") FOR TRANSFER OF THE UNITED STATES
DEPARTMENT OF AGRICULTURE OFFICE OF RURAL DEVELOPMENT
INTERMEDIARY RELENDING PROGRAM ("IRP") FUNDS AND COMMUNITY
DEVELOPMENT BLOCK GRANT ("CDBG") REVOLVING LOAN FUNDS.
WHEREAS, on March 4, 1985, the City Council passed Resolution 3567, authorizing
implementation of a Community Development Block Grant program; and
WHEREAS, on May 5, 2003, the City Council passed Resolution 4780, which established an
Economic Development Revolving Loan Fund for small business retention and
expansion in the City of Kalispell and created an Economic Development Loan
Review Committee; and
WHEREAS, the US Department of Agriculture Rural Development and CDBG Economic
Development Block Grant sources make loan funds available for the creation of
local government revolving loan programs for small business retention and
expansion which may stimulate economic development activity by assisting the
private sector where a funding gap exists and alternative sources of public and
private financing are not adequate; and
WHEREAS, the City Council desires to transfer the City's IRP and CDBG loan funds to
MWED, which currently operates and oversees CDBG and IRP loan programs
and is experienced in working with and complying with the administrative
requirements of State, Federal, and community lending programs in Montana; and
WHEREAS, the City and MWED wish to enter into a mutually beneficial arrangement that
enables MWED to expand its loan program offerings in the City to benefit small
business and eliminate duplication of services and, as such, will provide services
to the City related to the management and administration of the two City loan
programs.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
KALISPELL AS FOLLOWS:
SECTION 1. That the City Manager is hereby authorized and directed to execute the
Administrative Agreements with Montana West Economic Development
for transfer, management and administration of the United States
Department of Agriculture Office of Rural Development Intermediary
Relending Program funds and Community Development Block Grant
Revolving Loan funds.
PASSED AND APPROVED BY THE CITY COUNCIL AND SIGNED BY THE MAYOR OF
THE CITY OF KALISPELL, THIS 5TH DAY OF SEPTEMBER, 2023.
ATTEST:
Aimee Brunckhorst, CMC
City Clerk
Mark Johnson
Mayor
Community Development Block Grant Revolving Loan Fund
Administrative Agreement
Between the City of Kalispell and
Montana West Economic Development
THIS AGREEMENT is entered into on this day of , 2023, by and between
the City of Kalispell (the "City") and Montana West Economic Development ("MWED"), a
Montana not for profit organization in regard to the administration of City Community
Development Block Grant Revolving Loan Funds ("RLF"), (hereinafter referred to collectively
as the "Agreement") between the City and MWED.
WITNESSETH
WHEREAS, the City has two fully revolved RLF's, which are designed to leverage
private investment in new or expanded business for the purpose of generating new jobs; and
WHEREAS, MWED will establish a RLF totaling $180,000.00 comprised of the City
RLF; and
WHEREAS, MWED shall use the RLF to provide financing to leverage private
investment in the City by making low interest loans thereby enhancing the RLF for the benefit of
all eligible users; and
WHEREAS, MWED has substantial experience regarding Federal loan programs,
including loan programs and funding through the CDBG. Furthermore, the RLF will
complement the existing loan programs which MWED has administered for two decades.
MWED currently operates and oversees CDBG loan programs and is experienced in working
with and complying with the administrative requirements of State, Federal, and community
lending programs in Montana; and
WHEREAS, the City and MWED desire to enter into a mutually beneficial arrangement
that enables MWED to expand its loan program offerings in the City to benefit small business.
MWED will provide services to the City related to the management and administration of the
RLF.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties to this Agreement hereby agree as follows:
1. To the extent that the RLF as described in the Recitals is established, MWED will
provide all necessary management and administrative services regarding the RLF,
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ADMINISTRATIVE AGREEMENT
City of Kalispell Montana West Economic Development
existing City established RLF loans, and subsequent Ultimate Borrower loans approved
under the program. In that regard, MWED acknowledges that it has reviewed the CDBG
national objectives, and, as part of its administrative functions, will ensure compliance
with the requirements. Without limiting the generality of the foregoing administrative
obligations, MWED will undertake all the following obligations:
a. MWED will produce all necessary financial statements, loan summaries, reports
and similar materials;
b. MWED will produce and provide in a timely manner all necessary budgets to the
City including, but not limited to budgets for loan programs and proposed
administrative costs;
c. MWED will manage the Ultimate Borrower loan portfolios created through the
use of the RLF by, among other things, creating and retaining all necessary
documentation regarding such loans; disbursing loan proceeds; receipting and
depositing payments of principal and interest; communicating with Ultimate
Borrowers; and any other administrative measures necessary to properly manage
each of the Ultimate Borrower loans;
d. MWED will manage existing City loan portfolio created through the use of RLF
by, among other things, creating and retaining all necessary documentation
regarding such loans; receipting and depositing payments of fees, principal and
interest; funding the required reserves; communicating with borrowers; and any
other administrative measures necessary to properly manage each loan;
e. MWED shall manage all security interests in Ultimate Borrower collateral and in
the event of an Ultimate Borrower loan default shall collect and sell all physical
collateral which will go back into the loan fund;
f. MWED shall deposit and hold all RLF cash in a federally insured, interest bearing
account, at a bank or other financial institution. Each account shall not exceed the
maximum FDIC insurance coverage limits;
g. MWED will include the RLF into MWED's overall marketing plan for loan
programs;
h. MWED will assist the City in completing all required audits and providing the
results to the City; and
2. Initial and revolved Ultimate Borrower loan decisions shall be made by a majority vote of
the MWED loan committee comprised of members selected by MWED.
3. Administrative Fees. MWED may receive reasonable loan origination fees plus interest
on each Ultimate Borrower loan it makes.
4. Arbitration. To the extent that disputes arise regarding provisions of this Agreement, the
parties will attempt to resolve such disputes through good faith negotiations. If the
parties cannot resolve disputes during that time period, or such other period as may be
mutually agreeable, the parties shall resolve such disputes exclusively through binding
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ADMINISTRATIVE AGREFMENr
City of Kalispell Montana West Economic Development
arbitration. Such arbitration shall take place in Kalispell, Montana before a single
arbitrator under the commercial arbitration rules of the American Arbitration Association
(the "AAA"). If the parties cannot agree on an arbitrator, one shall be selected by the
AAA. The prevailing party is entitled to recover attorney's fees and costs.
5. Indemnification. MWED shall indemnify and hold harmless the City for any shortfall in
Revolving Fund cash whether in principal, interest, or otherwise as a result of Ultimate
Borrower loan defaults.
MWED shall indemnify and hold harmless the City, the City Development Services
Department, and their agents and employees from and against all claims, damages, losses
and expenses, including attorney fees, arising out of, or resulting from, the MWED's
performance of its obligations under this Agreement, provided that any such claim,
damage, loss, or expense is:
A. Attributable to bodily injury, sickness, disease or death or to damage of
destruction of tangible property, including the loss and use resulting therefrom;
and,
B. Is caused in whole or in part by any willful misconduct, intentional or negligent
act or omission of MWED or its contractor(s), and subcontractor(s), or anyone
directly or indirectly employed by any one of them, for whose acts any of them
may be liable, regardless of whether or not it is caused in part or by a party
indemnified hereunder.
6. Termination. Upon providing 90 calendar days written notice to the other Party or as
otherwise agreed between the Parties, either Party may terminate this Agreement with
respect to one or more services under this agreement. MWED agrees that upon
termination of this Agreement, MWED will cooperate in good faith with the City to
provide the City (or its designee) with reasonable assistance to make an orderly
transition, including the following:
i. Developing a transition plan with assistance from the City or its designee;
ii. Providing training to City personnel or its designee's personnel to perform
the RLF services;
iii. Organizing and delivering to the City copies of all records and materials of
all Ultimate Borrower loan files;
iv. MWED shall continue to service and manage any Ultimate Borrower
loans outstanding until they are paid in full; and
v. Indemnification shall remain in full force and effect from the date of
termination of this Agreement for Ultimate Borrower loans outstanding at
the time of termination of this Agreement.
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ADMINISTRATIVE AGREFMENr
City of Kalispell Montana West Economic Development
7. This Agreement constitutes the entire Agreement between the City and MWED regarding
the RLF and supersedes any prior discussions or negotiations between the Parties. This
Agreement may be amended or modified only in a writing signed by both Parties that
expressly states it is intended to modify the terms of this Agreement.
8. This Agreement is being executed in the City of Kalispell by Montana legal entities and
shall be governed by Montana law.
City of Kalispell
By:
Doug Russell, City Manager
ATTEST:
Aimee Brunckhorst, City Clerk
STATE OF MONTANA
County of Flathead
Date:
On this day of , 2023, before me, a Notary Public for the State
of Montana, personally appeared Doug Russell, City Manager of the City of Kalispell, and Aimee
Brunckhorst, City Clerk of the City of Kalispell, and acknowledged to me that they executed the
written instrument on behalf of said entity.
Montana West Economic Development
By: Date:
Christy Cummings Dawson, President
ATTEST:
Aimee Brunckhorst, City Clerk
STATE OF MONTANA
County of Flathead
On this day of , 2023, before me, a Notary Public for the State
of Montana, personally appeared Doug Russell, City Manager of the City of Kalispell, and Aimee
Brunckhorst, City Clerk of the City of Kalispell, and acknowledged to me that they executed the
Page - 4
ADMINISTRATIVE AGREFMENr
City of Kalispell Montana West Economic Development
written instrument on behalf of said entity.
Page - 5
ADMINISTRATIVE AGREFMENr
City of Kalispell Montana West Economic Development
Intermediary Relending Program
Administrative Agreement
Between the City of Kalispell and Montana West Economic Development
THIS AGREEMENT is entered into on this day of , 2023, by and between
the City of Kalispell (the "City") and Montana West Economic Development ("MWED"), a
Montana not for profit organization. in regard to the administration of the United States
Department of Agriculture Office of Rural Development (the "USDA-RD") Intermediary
Relending Program ("IRP") (hereinafter referred to collectively as the "Agreement") between the
City and MWED.
WITNESSETH
WHEREAS, the City has two loans from the United States Department of Agriculture
Office of Rural Development (the "USDA-RD") under the Intermediary Relending Program
("IRP"). MWED will establish a revolving fund totaling $460,000.00 (the "Revolving Fund")
comprised of the two City USDA-RD loans; and
WHEREAS, MWED shall use the IRP to provide financing to leverage private
investment in the City by making low interest loans; and
WHEREAS, MWED has substantial experience regarding Federal loan programs,
including loan programs and funding through the USDA, such as the IRP. Furthermore, the IRP
will complement the existing loan programs which MWED has administered for two decades.
MWED currently operates and oversees IRP loan programs and is experienced in working with
and complying with the administrative requirements of State, Federal, and community lending
programs in Montana; and
WHEREAS, the City and MWED desire to enter into a mutually beneficial arrangement
that enables MWED to expand its loan program offerings in the City to benefit small business.
MWED will provide services to the City related to the management and administration of the
IRP_
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties to this Agreement hereby agree as follows:
1. To the extent that the IRP as described in the Recitals is established, MWED will provide
all necessary management and administrative services regarding the IRP, existing City
established loans, and subsequent Ultimate Borrower loans approved under the program.
In that regard, MWED acknowledges that it has reviewed the terms of the USDA-RD
Loan Agreements and supporting documentation attached hereto as Exhibit "A", and, as
part of its administrative functions, will ensure compliance with the requirements as set
forth in the agreements as well as all other USDA-RD requirements. Without limiting
2
3
E
the generality of the foregoing administrative obligations, MWED will undertake all the
following obligations:
a. MWED will produce all necessary financial statements, loan summaries, reports
and similar materials in a timely manner to the USDA-RD, and will provide
copies of the same to the City and other persons or entities which may require
such documentation under the IRP;
b. MWED will produce and provide in a timely manner all necessary budgets to the
USDA-RD, or other agencies of the federal or state governments regarding the
IRP including, but not limited to budgets for loan programs and proposed
administrative costs;
c. MWED will manage the Ultimate Borrower loan portfolios created through the
use of the IRP loan funds by, among other things, creating and retaining all
necessary documentation regarding such loans; disbursing loan proceeds;
receipting and depositing payments of principal and interest; funding the required
reserves, communicating with Ultimate Borrowers; and any other administrative
measures necessary to properly manage each of the Ultimate Borrower loans;
d. MWED will manage existing City loan portfolio created through the use of the
IRP loan funds by, among other things, creating and retaining all necessary
documentation regarding such loans; receipting and depositing payments of fees,
principal and interest; funding the required reserves; communicating with
borrowers; and any other administrative measures necessary to properly manage
each loan;
e. MWED shall make debt service payments due on City USDA-RD IRP loans;
f. MWED shall manage all security interests in Ultimate Borrower collateral and in
the event of an Ultimate Borrower loan default shall collect and sell all physical
collateral which will go back into the loan fund;
g. MWED shall deposit and hold all City IRP loan funds in specifically designated
interest bearing accounts at a federally insured bank or other financial institution.
Each account shall not exceed the maximum FDIC insurance coverage limits;
h. MWED will include the City IRP funds into MWED's overall marketing plan for
IRP loan programs;
i. MWED will assist the City in completing all required audits and providing the
results to the USDA-RD regarding the IRP; and
j. MWED will determine and notify the City of all reserves required consistent with
the USDA-RD regulations.
Initial and revolved Ultimate Borrower loan decisions shall be made by a majority vote of
the MWED loan committee comprised of members selected by MWED.
Administrative Fees. MWED may receive reasonable loan origination fees plus interest
on each Ultimate Borrower loan it makes, subject to compliance with the IRP
administrative and program requirements.
Revolved funds are the cash portion of the Revolving Fund that is the principal and
interest payments from Ultimate Borrower loans. Revolved Funds are not considered
Federal funds. Revolved Funds shall be used for (1) debt service payments on the
USDA-RD IRP loan; (2) additional Ultimate Borrower loans; (3) debt service reserve
fund; (4) reserve for bad debts; (5) reasonable administrative costs; and (6) technical
assistance provided to Ultimate Borrowers.
5. Arbitration. To the extent that disputes arise regarding provisions of this Agreement, the
parties will attempt to resolve such disputes through good faith negotiations. If the
parties cannot resolve disputes during that time period, or such other period as may be
mutually agreeable, the parties shall resolve such disputes exclusively through binding
arbitration. Such arbitration shall take place in Kalispell, Montana before a single
arbitrator under the commercial arbitration rules of the American Arbitration Association
(the "AAA"). If the parties cannot agree on an arbitrator, one shall be selected by the
AAA. The prevailing party is entitled to recover attorney's fees and costs.
6. Indemnification. MWED shall indemnify and hold harmless the City for any shortfall in
Revolving Fund cash whether in principal, interest, or otherwise as a result of Ultimate
Borrower loan defaults. To the extent that cash in the Revolving Fund is insufficient for
the MWED to make a debt service payment to USDA-RD, MWED shall make a deposit
to the Revolving Fund cash account sufficient to meet the required dept service payment.
MWED shall indemnify and hold harmless the City, the City Development Services
Department, and their agents and employees from and against all claims, damages, losses
and expenses, including attorney fees, arising out of, or resulting from, the MWED's
performance of its obligations under this Agreement, provided that any such claim,
damage, loss, or expense is:
A. Attributable to bodily injury, sickness, disease or death or to damage or
destruction of tangible property, including the loss and use resulting therefrom;
and,
B. Is caused in whole or in part by any willful misconduct, intentional or negligent
act or omission of MWED or its contractor(s), and subcontractor(s), or anyone
directly or indirectly employed by any one of them, for whose acts any of them
may be liable, regardless of whether or not it is caused in part or by a party
indemnified hereunder.
7. Termination. Upon providing 90 calendar days written notice to the other Parry or as
otherwise agreed between the Parties, either Party may terminate this Agreement with
respect to one or more services under this agreement. hi the event that the IRP to USDA-
RD remains outstanding and upon termination of the Agreement by either parry as
outlined, all fees and expense reimbursements earned through the effective date of
termination shall be due and payable in accordance with the provisions hereof. MWED
agrees that upon termination of this Agreement, MWED will cooperate in good faith with
the City to provide the City (or its designee) with reasonable assistance to make an
orderly transition, including the following:
i. Developing a transition plan with assistance from the City or its designee;
ii. Providing training to City personnel or its designee's personnel to perform
the IRP services;
iii. Organizing and delivering to the City copies of all records and materials of
all Ultimate Borrower loan files;
iv. MWED shall continue to service and manage any Ultimate Borrower
loans outstanding until they are paid in full;
v. Indemnification shall remain in full force and effect from the date of
termination of this Agreement for Ultimate Borrower loans outstanding at
the time of termination of this Agreement.
8. This Agreement constitutes the entire Agreement between the City and MWED regarding
the IRP and supersedes any prior discussions or negotiations between the Parties. This
Agreement may be amended or modified only in a writing signed by both Parties that
expressly states that it is intended to modify the terms of this Agreement.
9. This Agreement is being executed in the City of Kalispell by Montana legal entities and
shall be governed by Montana law.
City of Kalispell
Date:
Doug Russell, City Manager
ATTEST:
Aimee Brunckhorst, City Clerk -
STATE OF MONTANA
County of Flathead
On this day of , 2023, before me, a Notary Public for the State
of Montana, personally appeared Doug Russell, City Manager of the City of Kalispell, and Aimee
Brunckhorst, City Clerk of the City of Kalispell, and acknowledged to me that they executed the
written instrument on behalf of said entity.
Montana West Economic Development
Date:
Christy Cummings Dawson, President
ATTEST:
Aimee Brunckhorst, City Clerk
STATE OF MONTANA
County of Flathead
On this day of , 2023, before me, a Notary Public for the State
of Montana, personally appeared Doug Russell, City Manager of the City of Kalispell, and Aimee
Brunckhorst, City Clerk of the City of Kalispell, and acknowledged to me that they executed the
written instrument on behalf of said entity.
16
Form RD 4274-4 UNITED STATES DEPARTMENT OF AGRICULTURE FORM APPROVED
(9-97) RURAL BUS(NESS-000PERATI VE SERVICE OMB NO. 0570-0021
INTERMEDIARY RELENDING PROGRAM
LOAN AGREEMENT
This agreemen ated as of October 12, 2004 is between the United States of America, acting through the U.S. Department
of Agriculture (USDA), and the City of Kalispell
(hereinafter called "Intermediary"). In consideration of the mutual covenants and agreements contained herein, parties agree as
follows:
I. Loan Terma:
USDA agrees to loan the principal sum of Five Hundred and Twenty Thousand (hereinafter referred to as "Loan"), to be
disbursed as hereinafter provided, bearing interest at the fixed rate of 1 percent per annum from the date funds are advanced as
more specifically set forth in paragraph 2 below. The term of the loan is for 30_years from 10/12/04.
This loan is evidenced by a promissory note of even date herewith made payable to the USDA. Intermediary agrees to use the loan
and its proceeds solely for activities as set forth in its Intermediary Relending Program (IRP) application including the "work plan"
submitted to USDA (including any supplements or modifications thereof agreed to by both parties) and in accordance with the loan
terms and conditions, the terms and conditions of this Loan Agreement and the rules and regulations (as they may be amended)
governing the IRP (7 CFR Part 4274, subpart D and 7 CFR Part 1951, subpart R),
2. Repayment:
Repayment of this loan shall be made as follows:
2.1 Interest only will be paid on the unpaid balance for the first 3 I years.
2.2 Principal and interest will be paid in 27 _ equal annual amortized installments beginning on October 12 2008
with any remaining balance due and payable thirty (30) years from the date of the note.
2.3 Intermediary shall pay a late charge of 4% of the payment due of principal or interest if payment for any of these installments is
not received within 15 calendar days following the due date. The late charge shall be considered unpaid if not received
within 30 calendar days of the missed due date for which it was imposed. Any unpaid late charge shall be added to principal and
bear interest at the same rate as noted above for said principal. Acceptance of a late charge by USDA does not constitute a waiver
of default.
3. Organization:
Intermediary shall not change its articles of incorporation, or charter, or by-laws without the written consent of USDA.
4. Disbursement Procedure:
4.1 Disbursement shall take place after this Loan Agreement and the promissory note are executed, and any other conditions
precedent to disbursement of funds under this award are fully satisfied. The Intermediary may not make a loan commitment
from USDA IRP loan funds to a project without first receiving USDA's written concurrence in the proposed use of
loan funds.
4.2 The Intermediary may draw down up to 25 percent of the USDA IRP loan funds at loan closing. Thereafter, the intermediary may
draw down under this award only such funds as are necessary to cover a 30-day period in implementing its approved work plan.
Advances will be requested by the Intermediary in writing. The date of such drawdown shall constitute the date the funds are
advanced under this Loan Agreement for purposes of computing interest payments.
4.3 Intermediary shall maintain a separate ledger and segregated bookkeeping and bank accounts for IRP funds as required in 7 CFR
Part 4274.
Accnrsling to the Paperwork Aeduaian Act of 1995. no persons are required to respond to a eolieetoon of informatan unless a displays a nohd OAMB control number The valid O S
control number for this information collection is 0$70-00lI. Me time required to complete this igormannor is emimared to average V 12 hour.% per respamse, including the tome for
reryfewing Inmrnahms. searchirt a-dirin darn mmrcer, gatheripg and maintataing rite data needed, and cnooldeling and reviewiM the collection a in armanan
r..
S. Reporting Requirements:
Intermediary shall provide USDA with the following reports as required by law or as deemed appropriate by USDA, plus any other
report as USDA shall from time to time require:
5.1 Annual audit; dates of audit report period need not necessarily coincide with other reports on the IRP program. Audits must cover
all of the Intermediary's activities and shall be due 90 days following the audit period.
5.2 Quarterly reports (done 30 days after the end of the period) on Form RD 19514, "Report of IRP/RDLF Lending Activity." This
report will include information on the Intermediary's lending activity, income and expenses, and financial condition, and a
summary of names and characteristics of the ultimate recipients the Intermediary has financed.
5.3 An annual budget for the following year.
5.4 These reports shall contain information only on the IRP loan funds, or if other funds are included, the IRP loan program portion
shall be segregated from the others; and in the case where the Intermediary has more than one IRP loan, from USDA, a separate
report shall be made for each of these IRP loans, if USDA has issued a requirement, in writing, that separate revolving funds be
maintained.
6. Relendink:
6.1 Before the first relending of USDA funds, Intermediary must obtain written USDA approval of:
A. All forms to be used for relending purposes, including application forms, loan agreements, promissory notes, and security
instruments; and
B. Intermediary's binding policy with regard to the amount and form of security to be required.
6.2 Intermediary must obtain USDA approval before making any major changes in forms or policy including its work plan:
6.3 It is the responsibility of the Intermediary to make and service loans to ultimate recipients in such a manner that willfully protect
the interests of the Intermediary and the USDA.
6.4 Intermediary will strive to use the proceeds of this loan promptly in accordance with work plan. If any part of the loan has not been
used by a date three years from the date of this agreement, USDA may cancel the approval of any funds not yet delivered to the
intermediary and demand the return, as an extra payment on the loan, of any funds delivered to the Intermediary that have not been
used by the Intermediary in accordance with the work plan.
7. Default:
On the occurrence of any event of default, USDA may declare all or any portion of the debt and interest created hereby to be
immediately due and payable and may proceed to enforce its rights under this Loan Agreement or any other instruments securing or
relating to this Loan and in accordance with the law and regulations applicable hereto.
Any of the following may be regarded as an "event of default" in the sole discretion of the USDA:
(A) Failure, inability or unwillingness of Intermediary to carry out or comply with the specific activities in its loan application as
approved by USDA, or Loan Terms and Conditions, or any terms or conditions of this Loan Agreement, or any applicable Federal
or State laws, or with such USDA regulations as may become generally applicable at any time.
(B) Failure of Intermediary to pay any installment of principal or interest on its promissory note to USDA when due as specified in
paragraph 2 above.
(C) The occurrence of. (1) Intermediary's becoming insolvent, or ceasing, being unable, or admitting in writing its inability, to pay its
debts as they mature, or making a general assignment for the benefit of, or entering into any composition or arrangement with
creditors; (2) proceedings for the appointment of a receiver, trustee or liquidator of Intermediary, or of a substantial part of its
assets, being authorized or instituted by or against it.
(D) Submission or making of any report, statement, warranty, or representation by Intermediary or agent on its behalf to USDA in
connection with the financial assistance awarded hereunder which is false, incomplete or incorrect in any material respect.
(E) Failure of Intermediary to remedy any material adverse change in its financial or other condition (such as the representational
character of its board of directors or policymaking body) arising since the date of USDA's award of assistance hereunder, which
condition was an inducement to USDA's original award.
8. Collateral:
8.1 The Intermediary shall pledge as collateral its 1RP Revolving Fund, including its portfolio of investments derived from the
proceeds of this loan award. It shall also pledge real and personal property, and other rights and interests USDA may require.
Intermediary shall execute any instruments, delivery any documents and take any action necessary or convenient to perfect a
security interest in such collateral.
8.2 In the event the Intermediary's financial condition deteriorates or the Intermediary takes action detrimental to prudent fund
operation or fails to take action required of a prudent lender, the Intermediary shall provide additional security, execute any
additional documents, and undertake any reasonable acts as USDA may request, to protect USDA's interest or to perfect a
security interest in any assets, including physical delivery of assets and specific assignments. All debt instruments and collateral
documents used by the Intermediary in connection with loans to ultimate recipients will be assignable.
9.Other Parties:
This Loan Agreement is not for the benefit of third parties. USDA shall not be under any obligation to any such parties, whether
directly or indirectly interested in the Loan Agreement, to pay any charges or expenses incident to compliance by Intermediary with
any of the duties or obligations imposed hereby.
10. Successors and Assigns:
The Loan Agreement shall be binding upon Intermediary and its successors and assigns and upon USDA and its successors and
assigns, and shall survive the closing of the loan and disbursement of proceeds.
11. Insurance_Reguirements:
11.1 The Intermediary will require each ultimate recipient to provide hazard insurance with a standard mortgage clause naming the
Intermediary as beneficiary in an amount that is at least the lesser of the depreciated replacement value of the property being
insured or the amount of the loan. Hazard insurance includes fire, windstorm, lightning, hail, business interruption, explosion,
riot, civil commotion, aircraft, vehicle, marine, smoke, builder's risk, public liability, property damage, flood or mudslide, or
any other hazard insurance that may be required to protect the security. The Intermediary's interest in the insurance will be
assigned to the USDA, upon USDA's request, in the event of default under this Agreement by The Intermediary.
11.2 Ordinarily, the Intermediary will require ultimate recipients to provide life insurance, which maybe decreasing term insurance,
for the principals and key employees of ultimate recipients and such life insurance will be assigned or pledged to the
Intermediary and subsequently, in the event of request by USDA following default by the Intermediary, to USDA.
11.3 The Intermediary will require each ultimate recipient to provide workmen's compensation insurance in accordance with State
law.
11.4 The Intermediary is responsible for determining if a Intermediary -financed project is located in a special flood or mudslide
hazard area anytime USDA loan funds are involved. If the Intermediary -financed project is in a flood or mudslide area, then
flood or mudslide insurance must be provided.
11.5 The Intermediary will acquire and maintain such insurance coverage, including fidelity bonds, as maybe required by USDA.
Position 2 Form RD 4274-4 (9-97)
I
12. AM licsable Laws:
Interpretation of this Loan Agreement shall be governed and enforced in accordance with applicable Federal Law.
IN WITNESS WHEREOF, USDA and Intermediary have executed this Agreement as of the date first above -mentioned.
INTERMEDIARY
BY:
(Signaturef "
PtJn41VC 6AZAJ EJZ-
(Name typed or printed)
Title: 161 LyA T i ` V 1,MAZIJ4-6 �Il
Date: _ d (-ry R 1 �) °�� f
USDA
BY:
(Signature)
JOHN D. GUTHMILLER
(Name typed or printed)
Title: Program Director
Date:
'lJ $ GOVERNMENT PRINTING OFFICE 1997456-043
e
Form RD 4274-3 TED STATES DEPARTMENT OF ACRICULTUR ; : FORM APPROVED
(9-97) Ir RURAL BUSINESS -COOPERATIVE SERVICE - OMB NO.0570.0021
INTERMEDIARY RELENDING PROGRAM
PROMISSORY NOTE
1. FOR VALUE RECEIVED, CitI of Kalispell
(Borrower) promises to pay to the order of the United States of America, acting through the U.S. Department of Agriculture (USDA)
through principal office at USDA, Rural Development, P.O. Box 850, Bozeman, MT 59771 , or through such place
as the USDA may designate in writing, the principal sum of Five Hundred Twenty Thousand dollars ($ 520,000 ),
plus interest on the unpaid principal balance at the rate of one percent (1 %) per annum. The said principal and interest shall be paid in the
following installments on or before the following dates:
(a) Interest only on October 12
Interest only on October 12
Interest only on October 12
'X
,
'20�
'2007 '
(b) Commencing on October 12 2008 and thereafter on October 12 of each year, principal and
interest payments in an amount to fully amortize the loan 30 years from the date of this note until the principal and interest are fully paid.
The amortized payments will be billed to the Borrower by the Government at least 30 days in advance of the payment due date and shall
be based on the actual amount then owed to the Government;
(c) The final installment of the entire indebtedness evidenced hereby, if not sooner paid, shall be due and payable thirty (30
years from the date of this note, and prepayments may be made at anytime. The consideration herefore shall support any agreement
modifying the foregoing schedule of payments.
if the total amount of the loan is not advanced at the time of loan closing, the loan shall be advanced to the Borrower as requested by the
Borrower and approved by USDA and interest shall accrue on the amount of each advance from its actual date.
Every payment made on any indebtedness evidenced by this note shall be applied first to interest computed to the effective date of the
payment and then to principal.
Prepayments of scheduled installments, or any portion thereof, may be made at any time at the option of the Borrower. Prepayments,
refunds and extra payments shall, after payment of interest, be applied to the installments last to come due under this note and shall not
affect the obligation of the Borrower to pay the remaining installments as scheduled herein.
Borrower shall pay a late charge of 4% of the payment if payment is not received within 15 calendar days following the due date. The late
charge shall be considered unpaid if not received within 30 calendar days of the missed due date for which it was imposed, and any unpaid
late charge shall be added to principal and bear interest at the same rate as noted above for said principal and will be due at the end of the
loan term. Payment of any installment of principal or interest owing on this note may be made prior to the maturity date thereof without
penalty.
2. The term, "Indebtedness," shall mean the indebtedness evidenced by this note, including principal, interest, and late payment
charges including any interest thereon, whether now due, or thereafter to become due.
3. If payment of the indebtedness evidenced by this note, or any part thereof, shall not be made when due and at maturity, by
acceleration or otherwise, the Borrower hereby authorizes and empowers any attorney of any court of record in the United States to appear
for the Borrower in court, or before any cleric thereof, and confess judgment against the Borrower in favor of the holder of this note for the
amount then due with interest and costs.
4. USDA may, at its option, declare all or any part of the indebtedness immediately due and payable upon the happening of any
of the following events:
(a) Failure to pay any part of the indebtedness due;
Acconling W Hie Paperwark RedhrasOn Ael of 1993, no persons are required is respond to a collection of information unless it displays a valid oAls control number 71,c valid OMB
ceniroi number for this information callectiar is 03 i0.0021. The rime required to compleie this information is esrlmated to average 1.1 2 hours per response. including she Nme for
reviewing hwruciwns, starching ¢riving dara.rotdrtes, gathering mtd maintaining the data needed, aml compleirng and reviewing the collection of information.
Position 2
Form RD 4274-3 (9.97)
(b) Default under, noncompliance with, or nonperformance of any term or condition of that certain Loan Agreement
or Supplemental Loan Agreement, of even date herewith, by and between the Borrower and USDA;
(c) Criminal violations, civil fraud, misrepresentations, or regulatory violations on the part of the Borrower. USDA's
failure to exercise its right to accelerate the due date of its payments shall not constitute a waiver thereof.
S. The indebtedness shall immediately become due and payable, without notice or demand, upon the appointment of a
receiver or liquidator, whether voluntary or involuntary, for the Borrower or for any of its property, or upon the malting by the Borrower
of an assignment for the benefit of its creditors.
6. The Borrower shall pay all expenses, whether incurred in or out of court, whether incurred before or after this note shall
become due at its maturity date or otherwise, which USDA may deem necessary or proper in connection with obtaining satisfaction of the
indebtedness, including but not limited to reasonable attorneys fees. USDA is authorized to pay at any time and from time to time any and
all of such expenses, add the amount of such payment to the indebtedness, and charge interest thereon at the applicable rate of interest
specified herein with respect to the principal amount of this note.
7. The rights of USDA or its assigns hereunder shall not be impaired by USDA's sale, hypothecation, or rehypothecation of
any note of the Borrower, or by any indulgence including but not limited to any renewal, extension or modification which USDA may
grant with respect to the indebtedness or any part thereof, or any indulgence granted in respect of any endorser, guarantor, or surety,
except of course to the extent of such indulgence. The purchaser, assignee, transferee, or pledgee of this note, any guarantee, and any
other document (or any of them), sold, assigned, transferred, pledged or repledged, shall forthwith become vested with and entitled to
exercise all powers and rights given by this note and by the aforesaid loan agreement and all applications of the Borrower to USDA as if
said purchaser, assignee, transferee, or pledgee were originally named as payee in this note and in said loan agreement and in said
application or applications, and subject to any claims and defenses of the debtor under such note, guarantee, loan agreement and any other
document.
g_ Any amount advanced or expended by USDA for the collection hereof or to protect any security hereto, or otherwise
under the terms of any security or other instrument executed in connection with the loan evidenced by this note, at the option of USDA
shall become a part and bear interest at the some rate as the principal of the debt evidenced by this note and be immediately due and
payable by the Borrower to USDA without demand.
9. This note is given to evidence a loan made by USDA in connection with the implementation of the Intermediary
Relending Program. This instrument is to be construed according to pertinent rules and regulations of USDA and is to be enforced in
accordance with applicable Federal law.
10. In the event that any provision or clause in this note is not enforceable in a court of law, all other provisions and clauses
shall continue to remain in effect.
Attest
^ CQctORAT
SEA
(Signature of Attesting
Name: City of Kalis II
(Name Borro er)
By
(Si nature of Official)
,Z,*J I,- (34-Q,IJ
(Printed or typed name of Oflieial)
/ - le L �-i FSZ �-G Wt C Nt IAr✓ (j Ef
(Title of.sirresting ici) V (Title of Ogcial)
Date 61. Z. _ .20 C4 Date_
•U.S.0 PO: 1997.656,044160017
Intermediary Certification
No major changes have been made in the work plan except those
approved in the interim by the Business -Cooperative Service.
2. All requirements of the Letter of Conditions, dated June 29, 2004, have
been met.
3. There has been no material change in the intermediary or its financial
condition since the issuance of the letter of conditions. (If changes have
occurred, they must be explained. The changes may be waived, at the
sole discretion of the Business -Cooperative Service).
4. No claim or lien of laborers, materialmen, contractors, subcontractors,
suppliers of machinery and equipment, or other parties are pending
against the security of the intermediary, and that no suits are pending or
threatened that would adversely affect the security of the intermediary
when the security instruments are filed.
Orr
Name: r' 4/ Y OF �4-I X' -"-S ,2_ ° (SEAL)
(NaAofffmro er) CORPORATE
By. SE&
{Sigcial} �`� �'~•
Attest: C�
(Printed or typed name of Ofirciao (Signature of Attesting Ofticial)
Title: IWC r PA CZI-t O t- U� Title:
(Title of Ofciao 71
Date: OCO4L9 2004 Date: Cd
UNITED STATES DEPARTMENT OF AGRICULTURE
RURALDEVELOPMENT
BUSINESS -COOPERATIVE PROGRAMS
SECURITY AGREEMENT
(Intermediary Relending Program)
I. THIS SECURITY AGREEMENT is made this 121' day of October, 2004,
between the United States of America, acting through the U.S. Department of
Agriculture (USDA), (herein called Secured Party), and the City of Kalispell,
whose mailing address is, P.O. Box 1997, Kalispell, MT 59903 (herein called
Debtor).
II. WHEREAS, Debtor is justly indebted to Secured Party as evidenced by a
certain promissory note, herein called the Note, dated October 12, 2004, for the
principal sum of Five Hundred Twenty Thousand ($520,000), with interest at the
rate of one percent (1%) per annum, executed by Debtor and payable to the
order of Secured Party, and
WHEREAS, the note evidences a loan to Debtor in the principal amount
specified therein, made with the purpose and intention that Secured Party, at any
time, may assign the note and insure the payment thereof pursuant to the
Consolidated Farm and Rural Development Act, as amended; and
WHEREAS, when payment of the note is insured by Secured Parry, it may
be assigned from time to time and each holder of the insured note, in turn, will be
the insured lender; and
WHEREAS, when payment of the note is insured by Secured Party,
Secured party will execute and deliver to the insured lender along with the note
an insurance endorsement insuring the payment of the note fully as to principal
and interest; and
WHEREAS, at all times when payment of the note is insured by Secured
Party, Secured Party by agreement with the insured lender set forth in the
insurance endorsement will be entitled to a specified portion of the interest
payments on the note, to be designated the "annual charge", and
WHEREAS, a condition of the insurance of payment of the note will be
that the holder will forego its rights and remedies against Debtor and any others
in connection with said loan, as well as any benefit of this instrument, it will
accept the benefits of such insurance in lieu thereof, and upon Secured Party's
request will assign the note to Secured Party; and
WHEREAS, it is the purpose and intent of this instrument that, among
other things, at all times when the note is held by Secured Party, or in the event
Secured Party should assign this instrument without insurance of the note, this
instrument shall secure payment of the note, but when the note is held by an
insured lender, this instrument shall not secure payment of the note or attach to
the debt evidenced thereby, but as to the note and such debt shall constitute an
indemnity security agreement to secure Secured Party against loss under its
insurance endorsement by reason of any default by debtor;
NOW, THEREFORE, in consideration of said loan and (a) at all times
when the note is held by Secured party, or in the event Secured Party should
assign this instrument without insurance of the payment of the note, to secure
prompt payment of the note and any renewals and extensions thereof and any
agreements contained therein, (b) at all times when the note is held by an
insured indemnify and save harmless Secured Party against loss under its
insurance endorsement by reason of any default by Debtor, and (c) all advances
and expenditures made by Secured Party, with interest, as hereinafter described,
and the performance of every covenant and agreement of Debtor contained
herein or in any supplementary agreement;
DEBTOR HEREBY GRANTS to Secured Party a security interest in its
interest in the following collateral;
Intermediary Relending Program (IRP) loan funds, accounts,
deposit accounts, supporting obligations, investment
property, promissory notes, general intangibles and payment
intangibles, and all assets now in or hereafter placed in the
IRP revolving fund, including but not limited to cash, portfolio
of investments, accounts, deposit accounts, notes receivable
from ultimate recipients, security interests, security
instruments, notes, mortgages, deeds of trust, accounts
receivable, contract rights, chattel paper, general intangibles,
drafts, acceptances and other forms of obligations,
receivables, and security documents, and all proceeds,
replacements and substitutions thereto, interest, fees and
other income and revenue, whether now existing or hereafter
arising, generated in connection with the IRP revolving fund
and investments.
III- DEBTOR WARRANTS, COVENANTS, AND AGREES THAT:
A. Debtor is the absolute and exclusive owner of the above described
collateral, and such collateral is free from all liens, encumbrances, security
and other interests except (1) any existing liens, encumbrances, security
or other interests in favor of Secured Party which shall remain in full force
and effect, and (2) other liens, encumbrances, security or other interests
as follows:
NONE
and Debtor will defend the collateral against the claims and demands of all
other persons. Reference to the above liens, encumbrances, security and
other interests is for warranty purpose only and does not indicate that
priority.
B. Statements contained in debtor's loan application (s) are true and
correct, and Debtor will (1) use the loan funds for the purpose for which
advanced, (2) not encumber the collateral or conceal it, or permit others to
do so, and (3) not permit the collateral to be levied upon or its value to be
impaired.
C. Debtor will pay promptly when due all (1) indebtedness to Secured
Party secured hereby, (2) rents, taxes, insurance, premium, levies,
assessments, liens, and other encumbrances, and costs of lien searches
and maintenance and other charges now or hereafter attaching to, levied
on, or otherwise pertaining to the collateral or this security interest, (3)
filing or recording fees for instruments necessary to perfect, continue,
service, or terminate this security interest, and (4) fees for inspection and
appraisal and delinquency charges now or hereafter required by
regulations of the Business -Cooperative Programs. At all times when the
note is held by an insured lender, Debtor shall continue to make payments
on the note to Secured Party, as collection agent for the holder of the
note.
D. Debtor will indemnify and save harmless Secured Party against any
loss under its insurance of payment of the note by reason of any default
by Debtor.
E. At all times when the note is held by an insured lender, any amount
due and unpaid under the terms of the note less the amount of the annual
charge, may be paid by Secured Party to the holder of the note as
provided in the note and insurance endorsement for the account of
Debtor. Any amount due and unpaid under the terms of the note, whether
it is held by Secured Party or by an insured lender, may be credited by
Secured Party on the note and thereupon shall constitute an advance by
Secured party for the account of Debtor. Any advance by Secured Party
�k 9
as described in this paragraph shall bear interest at the note rate from the
date on which the amount of the advance was due to the date of payment
to Secured Party.
F. Whether or not the note is insured by Secured Party, Secured Parry
may at any time pay any other amounts required herein to be paid by
Debtor and not paid by it when due, including any costs and expenses for
the preservation or protection of the collateral or this security interest, as
advances for the account of Debtor. All such advances shall bear interest
at the note rate until paid to Secured Party.
G. All advances by Secured Party as described in this instrument, with
interest, shall be immediately due and payable by Debtor to Secured Party
without demand at the place designated in the note and shall be secured
hereby. No such advances by Secured Party shall relieve Debtor from
breach of its covenant to pay. Such advances, with interest, shall be
repaid from the first available collections received from debtor. Otherwise,
any payment made by Debtor may be applied on the note or any
indebtedness to Secured Party secured hereby, in any order Secured
Party determines.
H. In order to secure or better secure the aforesaid obligations or
indebtedness, Debtor will execute and deliver to Secured Party at any
time, upon demand, such additional security instruments on such real and
personal property as Secured Party may require.
IV. IT IS FURTHER AGREED THAT:
A. Until default Debtor may retain possession of the collateral.
B. Default shall exist hereunder if Debtor fails to perform or discharge any
obligation or to pay promptly any indebtedness hereby Secured or to
observe or perform any covenants or agreements herein contained, or if
any of Debtor's representations or warranties herein provide false or
misleading, or upon the dissolution, bankruptcy, insolvency, or
incompetence of Debtor. Upon any such default.
1. Secured Party, at its option may (a) declare the unpaid balance
on the note and any indebtedness secured hereby immediately due
and payable, (b) enter upon the premises and take possession of,
repair, improve, use and operate the collateral or make equipment
unusable, for the purpose of protecting or preserving the collateral
of this lien, or preparing or processing the collateral for sale, and (c)
exercise any sale or other rights accorded by law.
I
2. Debtor hereby (a) agrees to assemble the collateral and make it
available to Secured Party at such time (s) and place (s) as
designated by Secured Party, and (b) waives all notices,
exemptions, compulsory disposition and redemption rights.
3. A default shall exist under any other security instrument held or
insured by Secured Party and executed or assumed by Debtor on
real or personal property. Likewise, default under any such there
security instrument shall constitute default hereunder.
C. Proceeds from disposition of Collateral shall be applied first on
expenses of retaking, holding, preparing for sale, selling and the like and
for payment of reasonable attorneys' fees and legal expenses incurred by
Secured Party, second to the satisfaction of Indebtedness secured hereby,
third to the satisfaction of subordinate security interests to the extend
required by law, fourth to any other obligations or Debtor owing to or
insured by Secured Party, and fifth to Debtor. Any proceeds collected
under insurance policies shall be applied first on advances and
expenditures made by Secured Party, with interest, as hereinabove
provided, second on the debt evidenced by the note, unless Secured
Party consents in writing to their use by Debtor under Secured Party's
direction for repair or replacement of collateral, third on any other
obligation of Debtor owing to or insured by Secured Party, and any
balance shall be paid to Debtor unless otherwise provided in the insurance
contract. Debtor will be liable for any deficiency owed Secured Party after
such disposition of proceeds of collateral and insurance.
D. It is the intent of Debtor and Secured Party to the extent permitted by
law and for the purpose of this Agreement that no collateral covered
hereby is or shall become realty or accessioned to other goods.
E. This agreement is subject to the present regulations of the Business -
Cooperative Programs, and to its future regulations not inconsistent with
the express provisions hereof.
F. If any provision of this Agreement is held invalid or unenforceable, it
shall not affect any other provision hereof, but this Agreement shall be
construed as if it had never contained such invalid or unenforceable
provision.
G. The rights and privileges of Secured Party under this Agreement shall
insure to the benefit of its successors and assigns. All covenants,
warranties, representations, and agreements of Debtors contained in this
Agreement are joint and several and shall bind its representatives,
successors and assigns.
H.. Secured Party shall have the sole and exclusive rights as the secured
party hereunder, including but not limited to the power to grant or issue
any consent, release, subordination, continuation statement or termination
statement, and no insured lender shall have any right, title or interest in or
AovthFva&pcurity interest created by this Agreement any nefits hereof.
ST:
BY:
T
SEAL
Signature)
Date 11
TITLE: T:rJ i �JL;v` cX Ty'
AGENCY:
DATE:
Positron 3
USDA FORM APPROVED
Form RD 400.4 ASSURANCE AGREEMENT OMB No. 0575-0018
(Rev. 3.97) (Under Title VI, Civil Rights Act of 1964)
The- CITY OF KALISPELL
(name of recipient)
P.O. BOX 1997- KALISPELL, MT 59903-1997
(address)
("Recipient" herein) hereby assures the U. S. Department of Agriculture that Recipient is in compliance with and will continue to
comply with Title VI of the Civil Rights Act of 1964 (42 USC 2000d et. seq.), 7 CFR Part 15, and Rural Housing, Service, Rural
Business -Cooperative Service, Rural Utilities Service, or the Farm Service Agency, (hereafter known as the " Agency") regulations
promulgated thereunder, 7 C.F.R. § 1901.202. In accordance with that Act and the regulations referred to above, Recipient agrees that
in connection with any program or activity for which Recipient receives Federal financial assistance (as such term is defined in 7
C.F.R. § 14.2) no person in the United States shall, on the ground of race, color, or national origin, be excluded from participation in,
be denied the benefits of, or be otherwise subjected to discrimination.
1. Recipient agrees that any transfer of any aided facility, other than personal property, by sale, lease or other conveyance of
contract, shall be, and shall be made expressly, subject to the obligations of this agreement and transferee's assumption thereof.
2. Recipient shall:
(a) Keep such records and submit to the Government such timely, complete, and a0yrate information as the Government may
determine to be necessary to ascertain ourlmy compliance with this agreement and the regulatiods.
(b) Permit access by authorized employees of the Agency or the U.S. Department of Agriculture during nonrml business
hours to such books, records, accounts and other sources of information and its facilities as may be pertinent to ascertaining such
compliance.
(c) Make available to users, participants, beneficiaries and other interested persons such information regarding the provisions
of this agreement and the regulations, and in such manner as the Agency or the U.S. Department of Agriculture finds necessary
to inform such persons of the protection assured them against discrimination.
3. The obligations of this agreement shall continue::
(a) As to any real property, including any structure, acquired or improved with the aid of the Federal financial assistance, so
long as such real property is used for the purpose for which the Federal financial assistance is made or for another purpose which
affords similar services or benefits, or for as long as the Recipient retains ownership or possession of the property, whichever is
longer.
(b) As to any personal property acquired or improved with the aid of the Federal financial assistance, so long as Recipient
retains ownership or possession of the property.
(c) As to any other aided facility or activity, until the last advance of funds under the loan or grant has been made.
4. Upon any breach or violation this agreement the Government may, at its option:
(a) Terminate or refuse to render or continue financial assistance for the aid of the property, facility, project, service or
activity,
(b) Enforce this agreement by suit for specific performance or by any other available remedy under the laws of the United
States or the State in which the breach or violation occurs.
provided for under this agreement shall be cumulative.
(name of recipient)
regiment to be executed by its duly authorized officers
agreement.
October 12, 2004
on this
hereto, or, if a natural person, has
Recipient
--�� Date
Title Title
According to the Poperwori Reduction Acf mJ 1993, no persons are required fa respuurd to n cailecdon o%inJorrealroa unrest it displays a valid OM8 control number. The valid OM8
control number for tius information collection is 0370•fl(11 ti, Thr hue required so romuplefe thii iglornra'lon is rsh-noled 10 avernse i3 minutes per reipam,e. Including the time for
revier.fng instructions, searching exisling data sonnets, gathero,K and siudntaining the data herded, cord cr erplrfir qq And revrarr,hg the colleclion aflnformatlon
Instructions for Completing SF 3881 Form
Make three copies of form after completing. Copy 1 is the Agency Copy; copy 2 is the
Payee/Company Copy; and copy 3 is the Financial Institution Copy.
1. Agency Information Section - Federal agency prints or types the name and address of
the Federal program agency originating the vendor/miscellaneous payment, agency
identifier, agency location code, contact person name and telephone number of the
agency. Also, the appropriate box for ACH format is checked.
2, Payee/Company Information Section - Payee prints or types the name of the
payee/company and address that will receive ACH vendor/miscellaneous payments,
social security or taxpayer ID number, and contact person name and telephone number
of the payee/company. Payee also verifies depositor account number, account title, and
type of account entered by your financial institution in the Financial Institution
Information Section.
3. Financial Institution Information Section - Financial institution prints or types the name
and address of the payee/company's financial institution who will receive the ACH
payment, ACH coordinator name and telephone number, nine -digit routing transit
number, depositor (payee/company) account title and account number. Also, the box
for type of account is checked, and the signature, title, and telephone number of the
appropriate financial institution official are included.
Burden Estimate Statement
The estimated average burden associated with this collection of information is 15 minutes
per respondent or recordkeeper, depending on individual circumstances. Comments
concerning the accuracy of this burden estimate and suggestions for reducing this burden
should be directed to the Financial Management Service, Facilities Management Division,
Property and Supply Branch, Room B-101, 3700 Fast West Highway, Hyattsville, MD
20782 and the Office of Management and Budget, Paperwork Reduction Project
(1510-0056), Washington, DC 20503.
LOAN AMORTIZATION CALCULATOR
ASSUMPTIONS
FIRST PAYMENT DATE
PRINCIPAL BORROWED
TERM IN MONTHS
BEGINNING INTEREST RATE
PAYMENT
AMORTIZATION TABLE
PAYMENT
NUMBER
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
PAYMENT
DATE
10/12/02008
10/ 12/02008
$477,5
a
1.00%
$20,269.00
CURRENT
INTEREST
PRINCIPAL
PRINCIPAL
RATE
PAYMENT
PORTION
PORTION
BALANCE
1.000/9
$20,268.00
$4,775.00
$15,493.00
$462,007.00
2cO I.00%
$20,268.00
$4,620.07
$15,647.93
$446,359.07
�orV 1.000/a
$20,268.00
$4,463.59
$15,804.41
$430,554.66
1.000/6
$20,269.00
$4,305.55
$15,962.45
$414,592.21
1.00%
$20,268.00
$4,14592
$16,122,08
$398,470.13
1.00%
$20,268.00
$3,984.70
$16,283.30
$382,186.83
1.00%
$20,268.00
$3,821.87
$16,446.13
$365,740.70
1.000%
$20,268.00
$3,657.41
$16,610.59
$349,130.11
1.001/o
$20,268.00
$3,491.30
$16,776.70
$332,353.41
1.00%
$20,268.00
$3,323.53
$16,944.47
$315,408.94
1.00%
$20,268.00
$3,154.09
$17,113.91
$298,295.03
1.00%
$20,268.00
$2,982.95
$17,285.05
$281,009.98
1.00%
$20,268.00
$2,810.10
$17,457.90
$263,552.08
1.00%
$20,268.00
$2,635.52
$17,632.49
$245,919.60
1.00%
$20,268.00
$2,459.20
$17,808.80
$228,110.80
1.00%
$20,268.00
$2,281.11
$17,986.89
$210,123.91
1.00%
$20,268.00
$2,101.24
$18,166.76
$191,957.14
1.00%
$20,268.00
$1,919.57
$18,348.43
$173,608.72
1.00%
$20,268.00
$1,736.09
$18,531.91
$155,076.80
1.00%
$20,268.00
$1,550.77
$18,717.23
$136,359.57
1.00%
$20,268.00
$1,363.60
$18,904.40
$117,455.17
1.00%
$20,268.00
$1,174.55
$19,093.45
$98,361.72
1.00%
$20,268.00
$983.62
$19,284.38
$79,077.34
1.000/6
$20,268.00
$790.77
$19,477.23
$59,600.11
1.00%
$20,268.00
$596.00
$19,672.00
$39,928.11
1.00%
$20,268.00
$399.28
$19,868.72
$20,059.39
�.o 1.00%
$20,076.11
$200.59
$19,875.51
$183.88
Fonn RD 1951-33 UNITED STATES DEPARTMENT OF AGRICULTURE
(Rev. 7-05 RURAL DEVELOPMENT
FARM SERVICE AGENCY
REAMORTIZATION REQUEST
FORM APPROVED
OMB No. 0575 0066
Name of Borrower
Case Number
Project Number
The City of Kalispell
31-015-816001281
61-02
Address P.O.Box 1997 - Kalispell, MT 59901
tate
County
MT
Flathead
Type of Loan
M Direct
Date(s) of Notes
Intermediary Relending Program
0 Insured
11-27-2006
Original Amount of Loan(s) and Grant(s)
Amount to be reamortized
Period of Reamortization
$7S0, 000. 00
$257, 500 .00
Years 27 Mo.
Interest Rate
Reamortized Installment
1.0000
$10,930.88
Present Problem and Reasons for Request (Give full detail)
The City of Kalispell under the previous City Manager decided that the debt of $750,000,and that the
balance of the non -disbursed funds could not sustain the principal and interest debt service. The
City of Kalispell was not able to find loans/projects with the staff turnover and current economic
conditions. In a letter dated, 2/13/2009 the City of Kalispell requested that the remainder of the
IRP loan be cancelled.
()f Mtsit
a % Dat�slt`�
Ci'.tPO TE orrower yl lr.
SEAT.
ily
Attest:
892 Secretary
Recommendations and Proof that Borrower Has Made Payments for at Least a Year or can Make Payments in an Amount Necessary to
Keep the Reamortized Account Current:
The City of Kalispell has paid as agreed regarding the above loan and all other IRP loans. The
City has had staff turn -over and changed its focus to community development than business
development in light of the current economy. The remaining balance of the loan at the City'e
request was cancelled. The remaining balance should be re -amortized over the remaining time of
the loan.
12-08-2009
Date _Servicing Official
Recommendations:
Date Program Director/District Director
Recommendations and/or Final Action T -
Date State Director
Accarding to the Poperwari Rtihiction Acr of 1995. an agency may tors conduct or sponsor, and a person is nat required to respond ia, a collealae of information unless It duplays a valid
OMB control number. The valid OMB control number for this information collection is 0575,00". The time required to complete this information ateelion is,stinted io average 15 minutes
per response, lndrding the time for reviewing truiructtons. searching existing dare rourets. gathering arrd mainraintng the data needed, and completing and reviewing the eollecdon of
nlformetlon.
Position 2 RD 1951-33 (Rev 7-05
I-� NrJ do Or! t . •. - , — . .1
r
Form RD 4274-3 UNITED STATES DEPARTMENT OF AGRICULTURE FORM APPROVED
(9.97) RURAL BUSINESS -COOPERATIVE SERVICE OMB NO, 0570-0021
INTERMEDIARY RELENDING PROGRAM
PROMISSORY NOTE
1. FOR VALUE RECEIVED, City of Kalispell
(Borrower) promises to pay to the order of the United States of America, acting through the U.S. Department of Agriculture (USDA)
through principal office at USDA Rural Development, P.O. Box 850, 9ozeman, MT 59771 ,or through such place
as the USDA may designate in writing, the principal sum of Seven hundred Fi f ty Thous dollars ($ - 750 , 000.00),
plus interest on the unpaid principal balance at the rate of one percent (I %) per annum. The said principal and interest shall be paid in
the following installments on or before the following dates:
(a) Interest only on November 27 2007
Interest only on November 27 2008 '
Inlcrest only on November 27 2009
(b) Commencing on November 27 2010 and thereafter on 11/27 of each year, principal and
interest payments in an amount to fully amortize the loan 30 years from the date of this note until the principal and interest are fully paid.
The amortized payments will be billed to the Borrower by the Government at least 30 days in advance of the payment due date and shall be
based on the actual amount then owed to the Government;
(c) The final installment of the entire indebtedness evidenced hereby, if not sooner paid, shall be due and payable thirty (30)
years from the date of this note, and prepayments may be made at anytime. The consideration herefore shall support any agreement
modifying the foregoing schedule of payments.
If the total amount of the loan is not advanced at the time of loan closing, the loan shall be advanced to the Borrower as requested by
the Borrower and approved by USDA and interest shall accrue on the amount of each advance from its actual date.
Every payment made on any indebtedness evidenced by this note shall be applied first to interest computed to the effective date of the
payment and then to principal.
Prepayments of scheduled installments, or any portion thereof, may be made at any time at the option of the Borrower. Prepayments,
refunds and extra payments shall, after payment of interest, be applied to the installments last to come due under this note and shall not
affect the obligation of the Borrower to pay the remaining installments as scheduled herein.
Borrower shall pay a late charge of 4% of the payment if payment is not received within 15 calendar day s following the due date. The late
charge shall be considered unpaid if not received within 30 calendar days of the missed due date for which it was imposed, and any unpaid
late charge shall be added to principal and bear interest at the same rate as noted above for said principal and will be due at the end of the
loan term. Payment of any installment of principal or interest owing on this note may be made prior to the maturity date thereof without
penalty.
2. The term, "Indebtedness," shall mean the indebtedness evidenced by this note, including principal, interest, and late payment
charges including any interest thereon, whether now due, or thereafter to become due.
3.1 f payment of the indebtedness evidenced by this note, or any part thereof, shall not be made when due and at maturity, by
acceleration or otherwise, the Borrower hereby authorizes and empowers any attorney of any court of record in the United States to appear
for the Borrower in court, or before any clerk thereof, and confess judgment against the Borrower in favor of the holder of this note for the
amount then due with interest and costs.
4. USDA may, at its option, declare all or any part of the indebtedness immediately due and payable upon the happening of any
of the following events:
(a) Failure to pay any part of the indebtedness due;
AcconInw in the Paperwork Redaction Act r f 1995, nolmrsom an rrgatrrd ro KsPWQfaa eallecitan of tnfarmotion artless uahsl+lajr a valid QA1l7 comtral nuarber The tWOOMB antral
number far this infitrtnahWt callectio,t u 0570-OW I. 77rt time rrgtirrd to cnrnpletr tits tnfurtrettwi is esnmated to average 1.1 2 lrotrrs per response, hKlading the tine jar revieu-ing
trurrarimm. searelang ewrotg data sutrces, gnthering and mahtaitang the daea aerrkat awl com#eting and reviex-lnx the cailechan of information.
Position 2
Form RD 4274.3 (9-97)
(b) Default under, noncompliance with, or nonperformance ofany term or condition of that certain Loan Agreement
or Supplemental Loan Agreement, of even date herewith, by and between the Borrower and USDA;
(c) Criminal violations, civil fraud, misrepresentations, or regulatory violations on the part of the Borrower. USDA's
failure to exercise its right to accelerate the due date of its payments shall not constitute a waiver thereof.
5. The indebtedness shall immediately become due and payable, without notice or demand, upon the appointment of a
receiver or liquidator, whether voluntary or involuntary, for the Borrower or for any of its property, or upon the making by the Borrower
of an assignment for the benefit of its creditors.
6. The Borrower shall pay all expenses, whether incurred in or out of court, whether incurred before or after this note shall
become due at its maturity date or otherwise, which USDA may deem necessary or proper in connection with obtaining satisfaction of the
indebtedness, including but not limited to reasonable attorneys fees. USDA is authorized to pay at any time and from time to time any and
all of such expenses, add the amount of such payment to the indebtedness, and charge interest thereon at the applicable rate of interest
specified herein with respect to the principal amount of this note.
7. The rights of USDA or its assigns hereunder shall not be impaired by USDA's sale, hypothecation, or rehypothecation of
any note of the Borrower, or by any indulgence including but not lim ited to any renewal, extension or modification which USDA may
grant with respect to the indebtedness or any part thereof, or any indulgence granted in respect of any endorser, guarantor, or surety,
except of course to the extent of such indulgence. The purchaser, assignee, transferee, or pledgee of this note, any guarantee, and any other
document (or any of them), sold, assigned, transferred, pledged or repledged, shall forthwith become vested with and entitled to exercise
all powers and rights given by this note and by the aforesaid loan agreement and all applications of the Borrower to USDA as if said
purchaser, assignee, transferee, or pledgee were originally named as payee in this note and in said loan agreement and in said application
or applications, and subject to any claims and defenses of the debtor under such note, guarantee, loan agreement and any other document.
8. Any amount advanced or expended by USDA for the collection hereof or to protect any security hereto, or otherwise
under the terms of any security or other instrument executed in connection with the loan evidenced by this note, at the option of USDA
shall become a pan and bear interest at the some rate as the principal of the debt evidenced by this note and be immediately due and
payable by the Borrower to USDA without demand.
9. This note is given to evidence a loan made by USDA in connection with the implementation of the Intermediary
Relending Program. This instrument is to be construed according to pertinent rules and regulations of USDA and is to be enforced in
accordance with applicable Federal law.
10. In the event that any provision or clause in this note is not enforceable in a court of law, all other provisions and clauses
inue to remain in effect.
CO1RATF
(ft
, Z-IW�,e
Attest:
(Signature of Arresting OSIcial)
r �l�
(Title of I
sling Oflicial)
Date
Name:
4'ame ojBor
ignalure of Oricaal)
JAMES PATRICK
(Printed or typed name ofOfcial)
Title City Manager
(Title of Official)
Date 5 -2�- t - n
Form RD 4274-5
(9-97)
This agreement dated
UNITED STATES DEPARTMENT OF AGRICULTURE
RURAL BUSINESS -COOPERATIVE SERVICE
INTERMEDIARY RELENDING PROGRAM
SUPPLEMENTAL LOAN AGREEMENT
11-27-2006
FORM APPROVED
OMB NO, 0570-0021
is between the United States of America acting through U.S. Department of Agriculture
(herein called USDA), and
(herein called Intermediary), This agreement supplements a certain Intermediary Relending Program Loan Agreement between
USDA and Intermediary dated 10-12-2004 in consideration of the mutual covenants and agreements contained
herein, parties agree as follows:
1. Loan Terms:
USDA agrees to loan the additional principal sum of $750, 000.00 (hereinafter referred to as loan),
bearing interest at the fixed rate of I percent per annum from the date funds are advanced. The term of the loan is for
30 years from 11-27-2006
This Loan is evidenced by a promissory note of even date herewith made payable to the USDA. Intermediary agrees to use
the Loan and its proceeds solely for activities as set forth in its Intermediary Relending Program (1RP) application including
the "work plan" submitted to USDA (including any supplements or modifications thereof agreed to by both parties) and in
accordance with the loan terms and conditions, the terms and conditions of this Supplemental Loan Agreement, and the rules and
regulations (as they may be modified) governing the IRP (7 CFR part 4274, subpart D and 7 CF R pan 1951, subpart R).
2. Repayment:
Repayment of this Loan shall be made as follows:
2.1 Interest only will be paid on the unpaid balance for the first three years,
2.2 Principal and Interest will be paid in 27 equal installments beginning on November
any remaining balance due and payable years from the date of the note.
3. Applicabil ity:
27
2010 with
The undersigned hereby agree that the provisions of that certain Intermediary Relending Program Loan Agreement between USDA
and Intermediary dated October 12 2004 also apply to this loan.
In witness thereof, USDA and Intermediary have executed this Agreement.
INTERMEDIARY
B�Qe)
JAMES PATRICK
(Name typed or printed)
EDA
BY: -- C
(Signature)
JOHN D. Zo'THMILLER
(Name typed or printed)
Title: City Manager Title:program Director
Date:
Date: �..-v1�� ,•
Aeeonhng to the Palwwwk Reducsiun Act of 1993, no penatu am req,ored ro mspund ra a rdkctfon of b fornwtfon anksi it displays a ra1id dMR romrd naatber The +nlsd OMN caned
numherfor this irl(armahon cdkctlan is 0170-0011. 11te time required to camplere this lnfarmarlan is estimated ru awnnge ! hoar per nspaur, tnclwhng she lime for renewing
inrtnwrhnn, searching esuhag data sources, gatherfrgr and rorrirrtalning the data nerrkd, aml rumpinhig and reviewing the collearon ofinformadmi
From RD 4274-5 (9.97)
Intennediary Certification
No major changes have been made in the work plan except those approved in
the interim by the Business -Cooperative Programs.
All requirements of the Letter of Conditions, dated September 21, 2006, have
been met.
3. There has been no material change in the intermediary or its financial condition
since the issuance of the letter of conditions. (If changes have occurred, they
must be explained. The changes may be waived, at the sole discretion of the
Business -Cooperative Programs).
No claim or lien of laborers, materialmen, contractors, subcontractors, suppliers
of machinery and equipment, or other parties are pending against the security of
the intermediary, and that no suits are pending or threatened that would
adversely affect the security of the intermediary when the security instruments
are filed.
Name: CITY OF KALISPELL
ame
ignature of Official)
(Printed or typed name of Official)
Title: c. -' ' )` 0%A AJ A
(Title of Official)
Date: Q _?- N cb--- , 20'�
CORPORATE
(AW ,
Attu.z r
(Signature of Attesting Official)
Title:4�&k
Date: J zg-'2 .2006
I
UNITED STATES DEPARTMENT OF AGRICULTURE
RURAL DEVELOPMENT
BUSINESS -COOPERATIVE PROGRAMS
SECURITY AGREEMENT
(Intermediary Relending Program)
1. THIS SECURITY AGREEMENT is made this 27th day of November 2006,
between the United States of America, acting through the U.S. Department of
Agriculture (USDA), (herein called Secured Party), and the City of Kalispell,
whose mailing address is, P.O. Box 1997, Kalispell, MT 59903 (herein called
Debtor).
II. WHEREAS, Debtor is justly indebted to Secured Party as evidenced by a
certain promissory note, herein called Note, dated November 27, 2006, for the
principal sum of Seven Hundred and Fifty Thousand ($750,000), with interest at
the rate of one percent (1 %) per annum, executed by Debtor and payable to the
order of Secured Party, and
WHEREAS, the note evidences a loan to Debtor in the principal amount
specified therein, made with the purpose and intention that Secured Party, at any
time, may assign the note and insure the payment thereof pursuant to the
Consolidated Farm and Rural Development Act, as amended; and
WHEREAS, when payment of the note is insured by Secured Party, it may
be assigned from time to time and each holder of the insured note, in turn, will be
the insured lender; and
WHEREAS, when payment of the note is insured by Secured Party,
Secured party will execute and deliver to the insured lender along with the note
an insurance endorsement insuring the payment of the note fully as to principal
and interest; and
WHEREAS, at all times when payment of the note is insured by Secured
Party, Secured Party by agreement with the insured lender set forth in the
insurance endorsement will be entitled to a specified portion of the interest
payments on the note, to be designated the "annual charge", and
WHEREAS, a condition of the insurance of payment of the note will be
that the holder will forego its rights and remedies against Debtor and any others
in connection with said loan, as well as any benefit of this instrument, it will
accept the benefits of such insurance in lieu thereof, and upon Secured Party's
request will assign the note to Secured Party; and
WHEREAS, it is the purpose and intent of this instrument that, among
other things, at all times when the note is held by Secured Party, or in the event
Secured Party should assign this instrument without insurance of the note, this
instrument shall secure payment of the note, but when the note is held by an
insured lender, this instrument shall not secure payment of the note or attach to
the debt evidenced thereby, but as to the note and such debt shall constitute an
indemnity security agreement to secure Secured Party against loss under its
insurance endorsement by reason of any default by debtor;
NOW, THEREFORE, in consideration of said loan and (a) at all times
when the note is held by Secured party, or in the event Secured Party should
assign this instrument without insurance of the payment of the note, to secure
prompt payment of the note and any renewals and extensions thereof and any
agreements contained therein, (b) at all times when the note is held by an
insured indemnify and save harmless Secured Party against loss under its
insurance endorsement by reason of any default by Debtor, and (c) all advances
and expenditures made by Secured Party, with interest, as hereinafter described,
and the performance of every covenant and agreement of Debtor contained
herein or in any supplementary agreement;
DEBTOR HEREBY GRANTS to Secured Party a security interest in its
interest in the following collateral;
Intermediary Relending Program (IRP) loan funds, accounts,
deposit accounts, supporting obligations, investment
property, promissory notes, general intangibles and payment
intangibles, and all assets now in or hereafter placed in the
IRP revolving fund, including but not limited to cash, portfolio
of investments, accounts, deposit accounts, notes receivable
from ultimate recipients, security interests, security
instruments, notes, mortgages, deeds of trust, accounts
receivable, contract rights, chattel paper, general intangibles,
drafts, acceptances and other forms of obligations,
receivables, and security documents, and all proceeds,
replacements and substitutions thereto, interest, fees and
other income and revenue, whether now existing or hereafter
arising, generated in connection with the IRP revolving fund
and investments.
III. DEBTOR WARRANTS, COVENANTS, AND AGREES THAT:
A. Debtor is the absolute and exclusive owner of the above described
collateral, and such collateral is free from all liens, encumbrances, security
and other interests except (1) any existing liens, encumbrances, security
or other interests in favor of Secured Party which shall remain in full force
and effect, and (2) other liens, encumbrances, security or other interests
as follows:
NONE
and Debtor will defend the collateral against the claims and demands of all
other persons. Reference to the above liens, encumbrances, security and
other interests is for warranty purpose only and does not indicate that
priority.
B. Statements contained in debtor's loan application (s) are true and
correct, and Debtor will (1) use the loan funds for the purpose for which
advanced, (2) not encumber the collateral or conceal it, or permit others to
do so, and (3) not permit the collateral to be levied upon or its value to be
impaired.
C. Debtor will pay promptly when due all (1) indebtedness to Secured
Party secured hereby, (2) rents, taxes, insurance, premium, levies,
assessments, liens, and other encumbrances, and costs of lien searches
and maintenance and other charges now or hereafter attaching to, levied
on, or otherwise pertaining to the collateral or this security interest, (3)
filing or recording fees for instruments necessary to perfect, continue,
service, or terminate this security interest, and (4) fees for inspection and
appraisal and delinquency charges now or hereafter required by
regulations of the Business -Cooperative Programs. At all times when the
note is held by an insured lender, Debtor shall continue to make payments
on the note to Secured Party, as collection agent for the holder of the
note.
D. Debtor will indemnify and save harmless Secured Party against any
loss under its insurance of payment of the note by reason of any default
by Debtor.
E. At all times when the note is held by an insured lender, any amount
due and unpaid under the terms of the note less the amount of the annual
charge, may be paid by Secured Party to the holder of the note as
provided in the note and insurance endorsement for the account of
Debtor. Any amount due and unpaid under the terms of the note, whether
it is held by Secured Party or by an insured lender, may be credited by
Secured Party on the note and thereupon shall constitute an advance by
Secured party for the account of Debtor. Any advance by Secured Party
as described in this paragraph shall bear interest at the note rate from the
date on which the amount of the advance was due to the date of payment
to Secured Party.
F. Whether or not the note is insured by Secured Party, Secured Party
may at any time pay any other amounts required herein to be paid by
Debtor and not paid by it when due, including any costs and expenses for
the preservation or protection of the collateral or this security interest, as
advances for the account of Debtor. All such advances shall bear interest
at the note rate until paid to Secured Party.
G. All advances by Secured Party as described in this instrument, with
interest, shall be immediately due and payable by Debtor to Secured Party
without demand at the place designated in the note and shall be secured
hereby. No such advances by Secured Party shall relieve Debtor from
breach of its covenant to pay. Such advances, with interest, shall be
repaid from the first available collections received from debtor. Otherwise,
any payment made by Debtor may be applied on the note or any
indebtedness to Secured Party secured hereby, in any order Secured
Party determines.
H. In order to secure or better secure the aforesaid obligations or
indebtedness, Debtor will execute and deliver to Secured Party at any
time, upon demand, such additional security instruments on such real and
personal property as Secured Party may require.
IV. IT IS FURTHER AGREED THAT:
A. Until default Debtor may retain possession of the collateral.
B. Default shall exist hereunder if Debtor fails to perform or discharge any
obligation or to pay promptly any indebtedness hereby Secured or to
observe or perform any covenants or agreements herein contained, or if
any of Debtor's representations or warranties herein provide false or
misleading, or upon the dissolution, bankruptcy, insolvency, or
incompetence of Debtor. Upon any such default.
1. Secured Party, at its option may (a) declare the unpaid balance
on the note and any indebtedness secured hereby immediately due
and payable, (b) enter upon the premises and take possession of,
repair, improve, use and operate the collateral or make equipment
unusable, for the purpose of protecting or preserving the collateral
of this lien, or preparing or processing the collateral for sale, and (c)
exercise any sale or other rights accorded by law.
2. Debtor hereby (a) agrees to assemble the collateral and make it
available to Secured Parry at such time (s) and place (s) as
designated by Secured Party, and (b) waives all notices,
exemptions, compulsory disposition and redemption rights.
3. A default shall exist under any other security instrument held or
insured by Secured Party and executed or assumed by Debtor on
real or personal property. Likewise, default under any such there
security instrument shall constitute default hereunder.
C. Proceeds from disposition of Collateral shall be applied first on
expenses of retaking, holding, preparing for sale, selling and the like and
for payment of reasonable attorneys' fees and legal expenses incurred by
Secured Party, second to the satisfaction of indebtedness secured hereby,
third to the satisfaction of subordinate security interests to the extend
required by law, fourth to any other obligations or Debtor owing to or
insured by Secured Party, and fifth to Debtor. Any proceeds collected
under insurance policies shall be applied first on advances and
expenditures made by Secured Party, with interest, as hereinabove
provided, second on the debt evidenced by the note, unless Secured
Party consents in writing to their use by Debtor under Secured Party's
direction for repair or replacement of collateral, third on any other
obligation of Debtor owing to or insured by Secured Party, and any
balance shall be paid to Debtor unless otherwise provided in the insurance
contract. Debtor will be liable for any deficiency owed Secured Party after
such disposition of proceeds of collateral and insurance.
D. It is the intent of Debtor and Secured Party to the extent permitted by
law and for the purpose of this Agreement that no collateral covered
hereby is or shall become realty or accessioned to other goods.
E. This agreement is subject to the present regulations of the Business -
Cooperative Programs, and to its future regulations not inconsistent with
the express provisions hereof.
F. If any provision of this Agreement is held invalid or unenforceable, it
shall not affect any other provision hereof, but this Agreement shall be
construed as if it had never contained such invalid or unenforceable
provision.
G. The rights and privileges of Secured Party under this Agreement shall
insure to the benefit of its successors and assigns. All covenants,
warranties, representations, and agreements of Debtors contained in this
Agreement are joint and several and shall bind its representatives,
successors and assigns.
H.. Secured Party shall have the sole and exclusive rights as the secured
party hereunder, including but not limited to the power to grant or issue
any consent, release, subordination, continuation statement or termination
statement, and no insured lender shall have any right, title, or interest in or
to the security interest created by this Agreement or any benefits hereof.
TITLE:
AGENCY: City of Kalispell
DATE: ')' '?- N u-v- v
RESOLUTION NO.5158
A RESOLUTION AUTHORIZING THE CITY MANAGER TO ENTER INTO A LOAN
AGREEMENT WITH RURAL DEVELOPMENT IN ORDER TO PARTIALLY FUND
THE ECONOMIC DEVELOPMENT REVOLVING LOAN FUND FOR SMALL
BUSINESS RETENTION AND EXPANSION.
WHEREAS, the City Council passed Resolution 4780 on May 5, 2003, which established an
Economic Development Revolving Loan Fund for small business retention and
expansion in the City of Kalispell and created an Economic Development Loan
Review Committee; and
WHEREAS, Rural Development and CDBG Economic Development Block Grant sources
have funding available for the creation of revolving loan funds for small business
retention and expansion which may stimulate economic development activity by
assisting the private sector where a funding gap exists and alternative sources of
public and private financing are not adequate; and
WHEREAS, the USDA Rural Development Agency's Intermediary Relending Program is
loaning the City of Kalispell the amount of $750,000 in order for the City to assist
at least five small business projects, as determined by the Economic Development
Loan Review Committee, with their financing needs.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
KALISPELL AS FOLLOWS:
SECTIQN 11. That the City Manager is hereby authorized and directed to enter into a
loan agreement with the United States Department of Agriculture, Rural
Development office, in the amount of $750,000 and comply with the
conditions as set forth in the attached Letter of Conditions.
PASSED AND APPROVED BY THE CITY COUNCIL AND SIGNED BY THE MAYOR OF
THE CITY OF KALISPELL, THIS 6TH DAY OF NOVEMBER, 2006.
Aamela B. ..
Mayor
ATTEST:
T eresa White
City Clerk
LOAN AMORTIZATION CALCULATOR
ASSUMPTIONS
FIRST PAYMENT DATE 27-Nov-10
PRINCIPAL BORROWED $150,000
TERM IN MONTHS 27
BEGINNING INTEREST RATE 1.00%
PAYMENT $6,366.83
AMORTIZATION TABLE
PAYMENT
PAYMENT CURRENT
INTEREST
PRINCIPAL
PRINCIPAL
NUMBER
DATE RATE
PAYMENT
PORTION
PORTION
BALANCE
i
27-Nov-10 ) GI4
1.00%
$6,366.83
$1,500.00
$4,866.83
$145,133.17
2
27-Dec-10 go I r
1.00%
$6,366.83
$1,451.33
$4,915.50
$140,217.67
3
27-Jan- I 1 p IS
1.00%
$6,366.83
$1,402.18
$4,964.65
$13 5,253.02
4
27-Feb-II �b l,�
1.00%
$6,366.83
$1,352.53
$5,014.30
$130,238.72
5
27-Mar-1 I ab 1 q
1.00%
$6,366.83
$1,302.39
$5,064.44
$125,174.28
6
27-Apr-I I a (b*�'
1.00%
$6,366.83
$1,251.74
$5,115.09
$120,059.19
7
27-May-I 1 lb
1.00%
$6,366.83
$1,200.59
$5,166.24
$114,892.96
8
it)
27-Jun-11 D 1 n
1.00%
$6,366.83
$1,148.93
$5,217.90
$109,675.06
9
27-Jul-1 I A 1`6
1.00%
$6,366.83
$1,096.75
$5,270.08
$104,404.98
10
27-Aug-11 �011
1.00%
$6,366.83
$1,044.05
$5,322.78
$99,082.20
11
27-Sep-11 ;0;b
1.00%
$6,366.83
$990.92
$5,376.01
$93,706.19
12
27-Oct-I 1 Aba l
1.00%
$6,366.83
$937.06
$5,429.77
$88,276.42
13
27-Nov-11p1097-
1.00%
$6,366.83
$882.76
$5,484.07
$82,792.36
14
27-Dec-I i PO
1.00%
$6,366.83
$927.92
$5,538.91
$77,253.45
15
27-Jan-12 90AI
1.00%
$6,366.83
$772.53
$5,594.29
$71,659.16
16
27-Feb-12 P09 f
1.00%
$6,366.83
$716.59
$5,650.24
$66,008.92
17
27-Mar-12902b
1.00%
$6,366.83
$660.09
$5,706.74
$60,302.18
18
27-Apr-12 p7l
1.00%
$6,366.83
$603.02
$5,763.81
$54,538.37
19
27-May-12 2-0A
1.00%
$6,366.83
$545.38
$5,821.45
$48,716.93
20
27-Jun-12;00
1.00%
$6,366.83
$487.17
$5,879.66
$42,837.27
21
27-Jul-12 PC
1.00%
$6,366.83
$428.37
$5,938.46
$36,898.81
22
27-Aug-12 7031
1.00%
$6,366.83
$368.99
$5,997.84
$30,900.97
23
27-Sep-12')-b 3
1.00%
$6,366.83
$309.01
$6,057.82
$24,843.15
24
27-Oct-12 } 3
1.00%
$6,366.83
$248.43
$6,118.40
$18,724.75
25
27-Nov-12'p3q
1.00%
$6,366.83
$187.25
$6,179.58
$12,545.17
26
27-Dec-12
1.00%
$6,366.83
$125.45
$6,241.38
$6,303.79
27
27-Jan-13 %� {°
1.00%
$6,309.04
$63.04
$6,246.01
$57.78
28
27-Feb-13
1.00%
$57.83
$0.05
$57.78
$0.00
COMMUNITY DEVELOPMENT -REVOLVING FUND
FUND: 2880-480-470210
PROJECTED REVENUE AND FUND SUMMARY
BEGINNING CASH
10100 Cash, Operating
10162 Cash, Reserve for investment (S&C)
REVENUES
345010
Application fees
373020
Loan Proceeds/Principal
373010
Loan Proceeds/ -Interest
371010
Interest Earnings (me S&C interest)
Total Revenue
Total Available
EXPENDITURES
353 Auditing
354 Contract Services
810 Redevelopment
Total Expenditures
ENDING CASH
10100 Cash, Operating
10162 Cash, Reserve for s & c investment
Total Cash
estimated
proposed
ACTUAL
BUDGET
ACTUAL
BUDGET
FY21/22
FY22/23
FY22/23
FY23/24
$258,801
$76,677
$76,677
$80,057
$43,855
$43,855
$43,855
$59,679
$302,656
$120,532
$120,532
$139,736
$0
$0
$0
$o
$40,936
$16,866
$16,866
$9,857
$1,693
$1,388
$1,388
$340
$2,245
$2,000
$2,500
$2,000
$44,874
$20,254
$20,754
$12,197
$347,530
$140,786
$141,286
$151,933
$1,000
$1,000
$1,000
$1,200
$998
$1,500
$550
$1,500
$225,000
$55,000
$0
$80,000
$226,998
$57,500
$1,550
$82,700
$76,677
$43,855
$23,607
$59,679
$80,057
$59,679
$21,699
$47,534
$120,532
$83,286
$139,736
$69,233
PROGRAM DESCRIPTION
This is a fund established in 2005 that consolidates "all' of the various loan types the Department has in existence or will be starting. Each type of loan
activity has its own line item number and can be easily identified for the audit or monitoring.
49
COMMUNITY DEVELOPMENT -REVOLVING FUND #2
FUND: 2881-480-470210
PROJECTED REVENUE AND FUND SUMMARY
BEGINNING CASH
10100 Cash, Operating
REVENUES
373020 Loan Proceeds/Principal
371010 Interest Earnings
Total Revenue
Total Available
EXPENDITURES
354 Contract services
810 Redevelopment
Total Expenditures
ENDING CASH
10100 Cash, Operating
Total Cash
estimated
proposed
ACTUAL
BUDGET
ACTUAL
BUDGET
FY21/22
FY22/23
FY22/23
FY23/24
$335,732
$67,983
$67,983
$101,119
$335,732
$67,983
$67,983
$101,119
$32,041
$32,041
$32,041
$19,293
$615
$1,000
$1,500
$1,000
$32,656
$33,041
$33,541
$20,293
$368,388
$101,024
$101,524
$121,412
$405
$405
$405
$475
$300,000
$50,000
$0
$100,000
$300,405
$50,405
$405
$100,475
$67,983 $50,619 $101,119 $20,937
$67,983 $50,619 $101,119 $20,937
50
RURAL DEVELOPMENT LOAN REVOLVING #61-01
FUND: 2887-480-470210
PROJECTED REVENUE AND FUND SUMMARY
BEGINNING CASH
10100 CASH: operating
10140 CASH: loan loss reserve
Total Cash
REVENUES
373010 Loan Interest
371010 Other Interest
373030 Principal
Total Revenue
Amount Available
Redevelopment Activity
Principal (Loan 61-01)
Interest (Loan 61-01)
Contract Service (Loan Software)
Total Expenditure
ENDING CASH
10100 CASH: operating
10140 CASH: loan loss reserve (6% o/s loans principal)
estimated
proposed
ACTUAL
BUDGET
ACTUAL
BUDGET
FY21/22
FY22/23
FY22/23
FY23/24
$176,291
$182,685
$182,685
$227,263
$32,557
$45,414
$45,414
$17,232
$208,848
$228,099
$228,099
$244,495
$7,587
$7,054
$7,054
$6,553
$215
$500
$250
$200
$33,638
$31,166
$31,166
$22,162
$41,440
$38,720
$38,470
$28,915
$250,288
$266,819
$266,569
$273,410
$115
$170,000
$0
$180,000
$19,204
$19,396
$19,396
$19,590
$2,870
$2,678
$2,678
$2,484
$0
$0
$0
$475
$22,189
$192,074
$22,074
$202,549
$182,685
$29,331
$227,263
$54,969
$45,414
$45,414
$17,232
$15,892
$228,099 $74,745 $244,495 $70,861
PROGRAM DESCRIPTION
The purpose of the Revolving Loan Fund (Rik') is to provide gap financing or business retention, expansion or start-up with the focus on job creation.
Funding Sources for the RLF come from possible CDBG Economic Development Grants, TIF, Rural Development Intermediary relending Program
(IRP) funds and the Community Development Revolving Loan Fund. The department was successful in writing a Rural Development (RD) grant
application for $520,000 from the RD Intermediary Relending Program (IRP) on 10/12/04.
53
RURAL DEVELOPMENT LOAN REVOLVING #61-03
FUND: 2888-480-470210
PROJECTED REVENUE AND FUND SUMMARY
estimated
proposed
ACTUAL
BUDGET
ACTUAL
BUDGET
FY21/22
FY22/23
FY22/23
FY23/24
BEGINNING CASH
10100 CASH: operating
$320,097
$309,884
$309,884
$299,979
10140 CASH: loan loss reserve
$0
$0
$0
$0
Total Cash
$320,097
$309,884
$309,884
$299,979
REVENUES
371010 Other Interest
$313
$400
$350
$300
Total Revenue
$313
$400
$350
$300
Amount Available
$320,410
$310,284
$310,234
$300,279
480-4702i(EXPENDITURES
354 Contract Services -Loan Software
$500
$500
$500
$500
610 Principal Repayment to IRP 61-03
$8,553
$8,638
$8,368
$8,725
620 Interest Repayment to IRP 61-03
$1,473
$1,387
$1,387
$1,300
750 Redevelopment Activity
$0
$289,000
$0
$279,000
Total Expenditures
$10,526
$299,525
$10,255
$289,525
ENDING CASH
10100 CASH: operating
$309,884
$10,759
$299,979
$10,754
10140 CASH: loan loss reserve (6% of o/s
prin of loans) $0
$0
$0
$0
$309,884
$10,759
$299,979
$10,754
PROGRAM DESCRIPTION
The purpose of the Revolving Loan Fund (RLF) is to
provide gap fmancing or business retention, expansion or start-up with the focus on job
creation.
Funding sources for the RLF come from possible CDBG
Economic Development Grants, TIF, Rural Development hitermediary
relending Program (IRP)
funds and the Community Development Revolving Loan Fund. The department was successful in writing a Rural Development (RD) grant application
on 11/27/06 from the RD Intermediary Relending Program (IRP) of which $257,500 was used.
54