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CITY
OF
LANCASTER,
MINNESOTA
LANCASTER
CITY
COUNCIL
PROCEEDINGS
The Lancaster City Council met for a special
meeting on Monday, April 29, 2013 at 7:00 p.m. in the City Hall
Meeting Room. The
following members were present: Olson, Stenquist, Barron, Nordin
&Hilman.
The purpose for the special meeting is to
review an application to the Revolving Loan Fund from Hanson
Manufacturing, Inc. in the amount of $90,000.00. Olson presented a Loan
Analysis Worksheet and a copy of the application review from the
loan fund manager of the North West Regional Development
Commission. Hanson
Manufacturing requests the loan of $90,000 for a term of 7 years at
1.5% per annum interest rate.
The company would use the money to work on development of a
new line of dump trailers and materials for another contract for
farm implement disk equipment.
The business has increased considerably in the last tax year,
but had suffered setbacks in the recession due to a company they did
business with filing bankruptcy. The loan would help Hanson
Manufacturing to maintain their workforce of 12 persons and they
project adding two full time jobs in the near future. Hanson Manufacturing is
offering first position on the 2001 Mitisbushi Laser cutter with an
estimate market value of $150,000. Mark Hanson and Sonja Hanson
would also sign a personal guaranty. The council reviewed the
information given and discussed the future projects that Hanson
manufacturing has in development. Council also discussed that
the collateral offered would qualify Hanson manufacturing for the
1.5% interest rate as set forth in the loan parameters.
Clerk reviewed the loan documentation as
provided by Brink, Sobolik, Severson, Vroom & Malm, PA. The law office has prepared
a “Scriveners Agreement”
that informs both parties to this agreement that the law
office has potential conflict of interest but has not had any part
in loan discussions and negotiations and that if any disagreement
arises both parties to the loan would need to have a different
attorney office handle the matter.
Stenquist moved to agree to the “Scriveners
Agreement” and allow the Mayor to execute said document, second by
Barron and carried.
Hilman
moved to provide the loan of $90,000.00 to Hanson
Manufacturing at an interest rate of 1.5 for 7 years with equal
monthly payments of $1129.33 from the Lancaster Revolving Loan Fund
and that the 2001 Mitisbushi Laser cutter along with an additional
personal guarantee from Mark & Sonja Hanson shall be adequate
security; and to allow
the Mayor and Clerk to execute all documents as needed , second by
Nordin. All voting in
favor of the motion to allow the loan, none voting against.
Meeting adjourned.
Carol Johnson, Clerk/Treasurer
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