HomeMy WebLinkAboutresolution.council.023-85RESOLUTION NO. ~_~__
(Series of 1985)
A RESOLUTION APPROVING THE SUBORDINATION OF THAT PROMISSORY NOTE
FROM THE MUSIC ASSOCIATES OF ASPEN, INC. TO THE CITY OF ASPEN IN
THE AMOUNT OF $78,900.00 WHICH PROMISSORY NOTE IS RECORDED AT BOOK
465 PAGE 279 IN THE RECORDS OF THE PITKIN COUNTY CLERK AND
RECORDER
WHEREAS, pursuant to that Water Service Agreement dated
November 14, 1983, recorded at Book 465, Page 294 in the records
of Pitkin County and that Promissory Note dated November ~4, 1983,
recorded at Book 465, Page 279 in the records of Pitkin County,
the Music Associates of Aspen promised to pay the sum of
$78,900.00 to the City on the terms and conditions described
therein, and
WHEREAS, at the time the aforesaid note and agreement were
recorded, deeds of trust were in effect to which the aforesaid
promissory note was subordinate which deeds of trust have been
released due to the Music Associates' refinancing efforts.
WHEREAS, the Music Associates, in an effort to obtain addi-
tional financing, has requested that the City subordinate its
promissory note to the following financial transactions:
1. Variable interest rate note dated September 20, ~985,
from First National Bank of Aspen in the amount of $400,000.00, a
copy of which is annexed.
2. Modification Agreement between Music Associates of
Aspen, Inc. and Pitkin County Bank dated September 26, 1985, per-
taining to a loan of $200,000.00, a copy of which Modification
Agreement is attached.
WHEREAS, the City Council desires to approve the Music Asso-
ciates' request and to authorize the City Manager to execute such
documents as may be necessary to accomplish the subordination.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF ASPEN, COLORADO
Section 1
The City Council hereby approve the subordination of the
aforesaid promissory note to the following financial transactions
by the Music Associates of Aspen:
1. Variable interest rate note dated September 20, 1985,
from First National Bank of Aspen in the amount of $400,000.00, a
copy of which is annexed.
2. Modification Agreement between Music Associates of
Aspen, Inc. and Pitkin County Bank dated September 26, 1985, per-
taining to a loan of $200,000.00, a copy of which Modification
Agreement is attached.
Section 2
The City Manager is hereby authorized and directed to execute
such documents and/or modifications thereof as approved by the
City Attorney
subordination.
Dated:
as may be necessary to accomplish the
_/_ .... , ,98 .
aforesaid
William L. StirIing. Mayor~
I, Kathryn S. Koch, duly appointed and acting City Clerk do
certify that the foregoing is a true and accurate ~py of that
resolution adopted by the City Council of the City of Aspen,
Colorado, at a meeting held on _, 1985.
2D
September 26, 1985
Honorable William Stirling,
Fellow Council Members
Aspen City Hall
130 South Galena
Aspen, CO 81611
Mayor
Dear Bill and Fellow Members:
This letter is to confirm my telephone conversation on September
25, 1985 with the City Attorney, Paul Taddune. It was my
understanding when the MAA signed the promissory note to the City
of Aspen for the Water Extension Agreement, that the City would
subordinate their lien to the banks in order for the NAA to
obtain its normal operating lines of credit.
We are in the process of renewing our lines of credit with First
National Bank in Aspen and Pitkin County Bank and Trust, copies
of the new promissory notes are attached. Notes to the
aforementioned banks are being renewed and the deeds of trust
relating to the original notes will be released, giving the City
a first position lien. In order for the MAA to obtain these
lines of credit, First National Bank in Aspen must have a first
deed of trust on the campus property and Pitkin County Bank and
Trust must have a second deed of trust. The City of Aspen has
been in a third position since the promissory note was executed
on November 14, 1983. Ue are asking the City of Aspen to remain
in third position.
Thank you for your cooperation
cc: /Paul Taddune
Louise Brainard
Thomas Griffiths
and assistance.
S rrely,
rdon Hardy
'esident
BORROWER(S) NAME, ADDRESS
MUSIC ASSOCIATES OF ASPEN~ INC. ~ a Colorado
P. O. Box AA Cot_potation
Aspen, CO ZIP 81612
DISCLOSURE OF LOAN TERMS:
1. Leap Principal ................. $.
2. {)th;or Charges (total)
a. file fees
b. title insurance
c. survey
d. tax certificate
3. LESS: Prepaid Finance Charges $.
4. Amount Financed ............... $
5. FINANCE CHARGE (total) $.
a, interest $
b. loan fee $
C.
d. $
6. Total of Payments ............... $
7. ANNUAL PERCENTAGE RATE:
First National Ballk in Aspo. ( /~ ~ ~'
Variable Interest Rate Note
NOTE DATE MATURITY DATE NOTE
(mo. da. yr.) {mo. da, yr.) NUMBER
' 9-20-85 9-20-86 4162568937
.%
PURPOSE OF LOAN: If the principal it le,s than $2.5,000 or the
note shall be used primarily for
[X~ ] 1. Business Purposes or
SECURITY: This Note IS secured by
[ ]NONE [X~] Describe: D/T on Lot l-A, Exception
Plat of Lot 1-k M.A.A. Inc., Filln~ No. 1,
The Aspen Music School Castle Creek Campus For
Music Associates o.[_ Asp_en~ I~LC_.,
Pitkin, State of Col_0~-ado.- ...............
**This Promissory_ evidences a Costinuing_3,i_ne o:
Credit. Such future advances may be made from
time to time but shall not exceed in the a8grel
the face amount of this Note. Any future adva~
shall 'be sub3ect to such conditions as the Ban]
may require.
end any security agreement el Borrower will secure future and other
indebtedness and will cover after acquired property.
FOR VALUE RECEIVED. the undersigned Borrower. promise{s) to pay to FI RST NATIONAL. BANK IN ASPEN ("Bank").
or order, at its offices in AlDen, Color~do, the p¢inci{~.~.~(~t~r~o f $ 400, ~on. ~ with interest et e veri0hfe rate {adjusted daily, lutomatiCllly
~onthly_co~enc~_Octobe~ ]g85~an~o~h~ ?O~h a=y ~ ~=c~ ~omth th~aaft~, ...ith the
_enti~e._p~pal_balance_plus~emai~mg ~c~ued ~ntmre~t ~,,~ =~pa~e in f~,!! =~
_September_20 ~98.6 ....
Shn.~d m. ANNUAl_ PERCENTAGE RATE b. increased by increases in tho Base Rate. such increase will result i, ,n increase in Ihs:
FUTURE ADVANCES AND OVERDRAFTS. Thi~ Note. and ,ny cog,terM given her,with evid,nc,s omi sm:utes: {i} ,n~ odditio,,I
however, in .o evenl shall a.v I,e,,.hv ur detmdt i.terest rate exceed the highest rets lawfully permitted end ir this ,~{~'e~idences a Cons.,.er Loan.
COSIGNeR(s) AND GUARANTOR(S). , mo~, m,. o., cofgno~ o~ ,ny guarantors sha~l sign this note. their obligelions shag be joint
~LEDGE RECEIPT OF THE *'NOTICE TO COSIGNERS" IN THE FORM REQUIRED BY LAW.
BORROWER(S) SIGNATURES(S):
PAYMENT GUARANTEED HUS[C ASSOC~ATgS OF ASPgN. iNC.. a Colorado
~s~m est
/ : /
.'~
MODIFICATION AGREEMENT
This Modification Agreement made this 26th day of September, 1985 by
· and between Pitkin County Bank and Trust Company (hereinafter referred to
as "Bank") amd Music Associates of Aspen, Inc., a Colorado Corporation
(hereinafter referred to ae "Obligor").
WHEREAS, the Obligor has previously executed a certain Promissory
Note (hereinafter referred to as "Note") payable to the Bank in the amount
of $300,000.00 dated the 1st day of December, 1984; and
WHEREAS, the Obligor has also executed a Deed of Trust encumbering
Lot i-A, Exception Plat of Lot I-A M.A.A., Inc., Filing No. 1 (a replat
of Lot 1, M.A.A. Inc. Filing No. I) the Aspen Music School Castle Creek
Campus for Music Associates of Aspen, Inc., recorded August 31, 1978 in
Plat Book 6 at Page 148, Pitkin County, Colorado, recorded in Book 492
at Page 831 o~ the records of Pitkin County dated the 14th day of August,
1985 to secure the Note; and
WHEREAS, the parties desire to modify certain terms of the Note and
Deed of Trust as set forth below;
NOW, in consideration of the mutual covenants contained herein and
other good and valuable consideration, receipt of which is hereby
acknowledged, the parties agree as follows:
1. The following terms of the Note and Deed of Trust are hereby
modified:
The principal balance of the note is hereby decreased from
$300,000.00 to $200,000.00. Interest shall accrue at the
rate of First Interstate Bank of Denver, N.A. prime rate
plus .50% adjusted daily. Repayment terms shall be as
follows: Accrued interest due monthly commencing 11/1/85,
and on the 1st of each month thereafter, with the entire
principal balance plus remaining accrued interest due and
payable in full at or before maturity, 10/1/86. Principal
balance must be reduced to zero (0) for a continuous period
of thi=ty (30) days during the term of this loan.
2. Obligor acknowledges that it is still the owner of the real pro-
perty securing the obligation as described in the Deed of Trust referred
to above and that the lien created by said Deed of Trust shall continue and
be in full force and effect.
3. Except as provided in Paragraph 1 above, all of the terms of the
Note and Deed of Trust shall be and remain in full force and effect.
IN WITNESS WHEREOF, THE PARTIES HAVE EXECUTED THIS Modification
Agreement the date and year first mentioned above.
,PITKIN COUNTY BANK AND TRUST
COMPANY, BY:
Thomas W. Griffiths~'~
Executive Vi~./P.r e S i.d~nt
MUSIC ASSOCIATES OF ASPEN, INC.,
a Co~ Corporati~n~:
Gv~djdn Hardy, Pres/q_d~nt ~]
Charles Paterson, Secretary
STATE OF COLORADO )
)
COUNTY OF PITKIN )
Subscribed and sworn to before me this day of.September, 1985
by Thomas W. Griffiths, as Executive Vice President of the
Pitktn County Bank and Trust Company.
Witness my hand and official seal.
My commission expires:
Notary Public
STATE OF COLORADO )
) SS. '"
COUNTY OF PITKIN )
Subscribed and sworn to before me this ~day of September, 1985
by GORDON HARDY, President
Witness my hand and official seal.
My commission expires:
STATE OF COLORADO )
) SS.
COUNTY OF PITKIN )
Subscribed and sworn to before me this 27thday of September, 1985
by CHARLES PATERSON, Secretary
Witness my hand and official seal.
My commission expires:
Recorded
Book
Page
RecepL!on Number
FIRST NATIONAL BANK IN ASPEN
SUBORDINATION AGREEMENT
19 85
SUBORDINATION AGREEMENT made this 30th day of
September ,
WHEREAS, Music Associates of Aspen, Inc.
by a Trust Deed dated November 14, 1983 and recorded at Book 465
Page 279 Pitkin County Records, granted to the Public Trustee of Pitkln County,
Colorado certain real property described as
Lot I-A.-Exception Plat of Lot 1-A M.A.A., Inc., Filing No. 1 (a replat of Lot 1,
M.A.A.','I~4~;Ell.fhg No. 1) The Aspen Music School Castle Creek Campus For Music
Associates.of. Aspen, Inc., recorded August 31, 1978 in Plat Book 6 at Page 148.
for the use .of J~Th~ C~¥ of As~en
to secure.a certain indebtedness in the original principal sum of
Seventy Eight Thousand Nine Hundred and no/lO0 ********************************* DOLLARS
($ 78,900.00 )'
WI T N E S S E T H:
FOR TEN DOLLARS ($10.00) and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged,
The City of ~spen ,
the undersigned, covenants, consents, and agrees that the above described full indebtedness
of Seventy Eight Thousand Ni~e Hundred and no/iO0***********DOLLARS ($ 78,900.00 )
and the lien of the t~ust deed recorded at Book 465 Page 279· together with
all interest thereon and any renewals or extensions thereof in whole or in part, shall be
inferior, subject to and subordinated to the following: (i) the indebtedness created by
a certain loan ~ade September 20 , 19 85 to Borrower by FIRST NATIONAL BANK
1N ASPEN in the principal sum of Four Hundre~-~housand and *************************
DOLLARS ($400,000.00 ), together with all interesg thereon; (ii) the Trust Deed of
even date therewith securing payment of the same; (iii) any other instruments made or
given by Borrower in connection therewith; and (iv) in the event-of any default there-
under, FIRST NATIONAL BANK IN ASPEN'S attorney fees, collection expenses, court costs,
accelerated interest, penalties, deficiencies, and any other charges as prescribed under
the Trust Deed for and until all of said indebtedness has been fully paid and satisfied,
together with interest thereon, including any renewal or renewals, extension or
extensions thereof, whether direct as maker or indirect as endorser to or for said
Borrower.
IN THE EVENT that the Borrower shall be adjudged bankrupt or be unable
to pay its debts as they mature, or a receiver or trustee be appointed therefor or for
its assets, or the Borrower shall be dissolved or liquidated and the assets thereof
distributed, any and all monies or dividends received in liquidation by reason of any
such indebtedness from the Borrower to the undersigned shall be paid and turned over to
FIRST NATIONAL BANK IN ASPEN until all of the indebtedness and interest thereon, due
and to become due to said FIRST ,NATIONAL BANK IN ASPEN from the Borrower, shall have
been paid in full, and the undersigned shall not be entitled to receive any monies or
distributions for or on account of any claims of the undersigned against the Borrower
unless and until all such indebtedness to FIRST NATIONAL BANK IN ASPEN shall have been
first paid in full. The undersigned hereby agrees to execute such further instruments,
documents, or take such other steps as may be necessary or proper to carry out the
intent of this Subordination Agreement.
THIS SUBORDINATION AGREEMENT shall bind the parties hereto, their
successors, assigns, heirs and personal representatives.
Subscribed and sworn to me this
b~.Wv.~ay of ~:T'. ,19 85.
Kim Wiihoit, No~a~/Public ~
My Commission expires ~-2.c{ - 15,~
FORM:
THE CITY OF ASPEN
016 (9/78) Subordination Agreement for Real Property
-2-
STATE OF COLORADO )
) ss
COUNTY OF PITI{IN )
chis
The foregoing Subordination Agreemen~ was acknowledged before me
Witness m~y hand and offic±al seal.
Notary Public
t'ol~:
016
~,. t.,'i'
Subordination Agreement for'Rsa~PYpperty