10-02-1995 WS - Laserfiche WebLink

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The Mister Donut in Mounds View was built in 1983. The shop was owned and unsuccessfully operated by Mr. Glen Marsh and it closed in 1985. Having plenty of work experience though n business experience, we purchased the franchise from Mr. Marsh with a$45,000 home mortgage loan from Donna's parents, Richard and Effie Martin.) On September 20, 1995 we signed a sub-lease with Mr. Marsh. The terms being$1,650.00 per month or 10% of gross sales. In addition, the lease included payment of real estate taxes and assessments to Scottland Inc. each month. In October 1987 we were served with a 7 day eviction notice. Mr. Marsh had gone bankrupt. With the advise of a lawyer we chose to take the risk to make the store profitable even though the cost of operations would be much higher. We signed a lease with Scottland Inc. on April 29, 1987. The terms being$3,333.00 per month plus real estate taxes and assessments. Given the increase in rent, we fell rapidly behind in all areas. By 1989 we had become $26,370.00 behind in our lease obligation to Scottland Inc. We received notice on September 1, 1989 that Scottland Inc. was willing to accept an immediate payment of$10,000.00 to satisfy the debt. Also, Scottland amended the lease to reduce the rent to $3,000.00 per month and deleted from the lease our obligation to pay real estate taxes and assessments. The restructured lease was signed on October 1, 1989. (The$10,000.00 came from a loan from Donna's Parents the Martins) In January 1990, J. Brooks Hauser(Scottland Inc.) also went bankrupt and the property was secured by Midwest Federal Savings and Loan. When Midwest went insolvent, the property was under a number of management companies for the Resolution Trust Corporation(RTC). The RTC put the property on the market for$210,000.00 Though we tried many institutions, we were unable to secure financing to purchase the property. We contacted Senator Paul Wellstone's office at the recommendation of a valued customer. With the help of his staff we were able to obtain financing through the First National Bank of Amarillo, TX. (Again we receive financial help from the Martins, $30,000)