3.5. EDSR 08-12-2002 - Laserfiche WebLink

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Item 3.5. • ..J1/ City of Elk -1 River MEMORANDUM TO: Economic Development Authority FROM: Catherine Mehelich, Director of Economic Development DATE: August 12, 2002 SUBJECT: Consider Amendment of Steve Whiting (Northstar Die Casting) Settlement Payments On January 29, 1998 Northstar Die Casting,LLC, executed a promissory note in favor of the EDA in the amount of$50,000. Steve Whiting and Larry Lawson executed a personal guaranty of the promissory note. Northstar Die Casting defaulted on the Note. In September 1999 the EDA commenced a civil action related to the personal guaranty. On August 21,2000 the EDA and Mr.Whiting agreed upon a settlement which included Mr.Whiting's agreement to pay the EDA a total of$36,000,without interest. Payment terms were$1,000 each month beginning September 1,2000 and continuing monthly until a final payment on August 1, 2003. According to the settlement agreement,if Mr. Whiting fails to make any of the payments the EDA may execute and file a Satisfaction of Judgment upon Mr. Whiting's payment of the judgment amount plus post-judgment interest. The EDA continued to receive payment from Mr. Whiting until April 2002. No payments have been received since March 14, 2002. On July 10, 2002 the city attorney sent a letter to Mr.Whiting regarding the default. Mr. Whiting has recently contacted staff regarding his overdue balance. He has requested that the payments be reduced to $500.00 per month as a result of the slow business he is experiencing. Recommendation Staff requests the EDA consider reducing Steve Whiting's monthly settlement payments to $500.00 per month for a period of one year commencing September 1, 2002. Staff recommends that payment in the amount of$1,000 per month resume no later than September 1,2003 and continue until full payment is received in July 2004.