HomeMy WebLinkAbout19-EDA-333EDA RESOLUTION 19 -EDA -333
CITY OF MOUNDS VIEW
COUNTY OF RAMSEY
STATE OF MINNESOTA
A RESOLUTION APPROVING A LOAN SERVICING AGREEMENT WITH THE
CENTER FOR ENERGY AND ENVIRONMENT
BE IT RESOLVED by the Board of Commissioners (the "Board") of the Mounds View
Economic Development Authority (the "Authority") as follows:
Section 1. Recitals.
1.01. The Authority is authorized pursuant to Minnesota Statutes, Sections 469.090 to
469.1081 (the "EDA Act"), to participate in providing certain loan programs (collectively, the
"Loans").
1.02. The Authority has in the past used the Community Reinvestment Fund, Inc., d/b/a
Community Reinvestment Fund, USA, a non-profit corporation organized under the laws of the
state of Minnesota ("CRF") to service the Authority's loan programs.
1.03. The Authority has selected the Center for Energy and Environment, a non-profit
corporation formed under the laws of the state of Minnesota, as the new servicer of the Loans.
1.04. The Authority has negotiated the terms of the loan servicing agreement (the
"Agreement"), a copy of which is attached as Exhibit A to this resolution.
1.05. The Board has reviewed the Agreement and finds that the execution thereof by the
Authority and performance of the obligations thereunder are in the best interest of the Authority,
the City and its residents.
Section 2. Authorization.
2.01. The recitals set forth in this Resolution are incorporated into and made apart of this
Resolution.
2.02. The Board hereby approves the Agreement in substantially the form presented to
the Board on the date below and further subject to any modifications that do not alter the substance
of the transaction and that are approved by the Authority's attorney.
2.03. The proper Authority officials, staff and consultants are authorized to execute the
Agreement and to take any and all other steps necessary or convenient in order to carry out the
obligations under the Agreement, as well as to fulfill the intent of this Resolution.
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EDA Resolution No. 19 -EDA -333
Page 2
Adopted on the 25th day of November, 2019.
Carol A. Mueller, Presi ent
Attest:
A0,j-,,/r
Nyle AnAid, Executive Director
(SEAL)
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EXHIBIT A
Loan Servicing Agreement
[to be added]
A-1
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LOAN SERVICING AGREEMENT
This LOAN SERVICING AGREEMENT (“Agreement”) is made by and between CENTER FOR
ENERGY AND ENVIRONMENT, with offices at 212 Third Avenue North, Suite 560, Minneapolis,
Minnesota 55401 (“CEE”) and the MOUNDS VIEW ECONOMIC DEVELOPMENT AUTHORITY,
in and for the City of Mounds View, with offices at 2401 Mounds View Boulevard, Mounds View, MN
55112 (“Client”).
RECITALS
In consideration of their mutual undertakings and payments provided for herein, the parties recite,
covenant, and agree to the following:
A. CEE is a non-profit corporation engaged in the servicing of development loans; and
represents that it is qualified and authorized to perform the services described herein; and
B. Client originates, purchases, owns, and/or manages loans that benefit economically distressed
or declining areas, disadvantaged persons, neighborhoods or community revitalization, foster
job creation, or other section 501(c)(3) charitable purposes; and
C. CEE is authorized by Client to function as a servicing agent under the terms of this
Agreement; and
D. Client now desires to have CEE perform the duties set forth herein for the loans covered by
this Loan Servicing Agreement.
NOW, THEREFORE, CEE and Client agree as follows:
1. Duties of CEE
CEE shall, at all times and with respect to all loans identified by Client (the “Client Loans”)
which it has been engaged by the Client to service, employ its normal and regular servicing
activities in the servicing of Client Loans to perform those responsibilities specifically set forth
on Exhibit A (the “Services”). The parties acknowledge that, from time to time, the Services may
be modified at the request of the Client and agreement by CEE. Such changes shall be mutually
agreed upon and are not effective unless agreed to in writing by the execution of a revised
Exhibit-A.
2. Effective Date
CEE shall commence servicing activities under this Agreement effective on the following date:
January 1, 2020 (“Effective Date”) and shall continue until terminated as provided in Section 16
of this Agreement.
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3. Servicing Compensation and Reimbursement
Client shall compensate CEE for the Services in accordance with the fee schedule attached as
Exhibit B of this Agreement and reimburse CEE for any of CEE’s verifiable out-of-pocket costs,
including but not limited to the costs of recordation of documents incidental to provision of the
Services, perfecting or releasing liens, legal costs incurred, servicing of notices, repossession,
foreclosure, and other similar costs paid by CEE on behalf of Client with respect to CEE’s actions
on specific Client Loan(s) (collectively, the “Fees”). CEE, as part of it providing the Services, is
entitled to institute a late payment policy upon clearly established rules which are communicated
to the borrower. In addition to the compensation provided for herein, CEE shall be entitled to
retain any late fee payments collected from borrowers pursuant to such policy. CEE shall retain
fees owed from fund remittance as provided in Exhibit A. CEE shall issue a written report, upon
request of Client, to Client showing the total net fees it has collected along with all funds which
are remitted to Client. Following the Initial Term, as hereinafter defined, CEE may increase the
Fees from time to time by providing an updated Exhibit B to Client at least sixty (60) days prior
to effective date of the new fee schedule and no more than one time annually.
4. Initial Boarding of Clients
In making this Agreement, CEE represents, warrants, and agrees to provide Client the
Information for each Client Loan and the loan documents related to the Client Loans upon
request.
For purposes of this Agreement, “Information” shall include the following:
Borrower Full Name
Property Address, if Secured
Loan Amount
Interest Rate
Term
Closing Date
Monthly Payment Amount
Payoff Date
Amortization Schedule
Closing Documents
Servicing Records
Complaint Resolution
Collections Records (for Delinquent Accounts only)
Client will cooperate with CEE, and provide CEE such information and documents as may be
necessary in CEE’s discretion to perform its duties under this Agreement, including to reconcile
any loan balance information provided to CEE. CEE may rely in good faith on information
provided to it by Client.
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5. Ongoing Boarding of Client Loans
On a regular basis, following the Effective Date of this Agreement, CEE will notify Client of
newly originated Loans for which it will service under the terms of this Agreement.
Client represents, warrants, and agrees to cooperate with CEE, and provide CEE such information
as may be necessary to perform its duties under this Agreement, reconcile any loan balance
information provided to CEE, and CEE may rely in good faith on information provided to it by
Client.
CEE represents, warrants, and agrees to onboard loans accurately according to the provisions
provided by Client and shall, subject the terms of this Agreement. CEE further agrees that it shall
remedy any onboarding errors within five (5) business days (or such shorter period as may be
required by applicable law) after receipt of notice of such errors.
6. Reports the Property of Client
All reports, documents, and materials delivered by CEE to Client pursuant to this Agreement are
the exclusive property of Client. Client may use any work product prepared by CEE in such
manner, for such purpose, and as often as Client shall deem advisable, in whole, in part, or in
modified form, without further compensation to CEE.
7. Nature of Agreement
CEE shall perform all of its services and duties hereunder at its own expense and without cost or
charge to Client except as expressly provided in Exhibit B.
Governmental Approvals. CEE has obtained and will maintain in full force and effect,
and satisfy at all times, all related eligibility criteria in order to maintain in full force and
effect, without material impairment, suspension or revocation, all municipal, local, or
other applicable governmental approvals, registrations, qualifications, permits, licenses,
and other applicable authorizations that are required or necessary to perform and conduct
the services and CEE’s business in accordance with Applicable Requirements, as
hereinafter defined.
For purposes of this Agreement, “Applicable Requirements” shall mean:
(1) All applicable federal, state, and local legal and regulatory requirements binding
upon CEE related to the performance of the Services;
(2) All other final judicial and administrative judgments, orders, stipulations, awards,
writs, and injunctions applicable to CEE; and
(3) The reasonable and customary practices of prudent loan servicing providers that
offer the same types of services as CEE for the same types of loans serviced by
CEE in the jurisdictions in which CEE operates.
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8. Disaster Recovery
CEE shall take all commercially reasonable precautions to mitigate the risks to information
regarding the Client Loans in connection with disruptions to business operations due to fire,
flood, storm, epidemic illness, equipment failure, sabotage, terrorism, natural disaster, disaster
caused by humans, or electronic data system failures. CEE shall also be responsible for installing
commercially-reasonable data security protocols in order to protect all information related to this
Agreement from potential data breach or other cybercrime.
CEE shall keep duplicate records of all electronic information in its possession or control
pertaining to Client Loans and shall store at least one copy of such duplicate records in a site
remote from its main offices in the following manner:
(1) Full backups of daily files for 7 consecutive days (weekly backup);
(2) Full weekly backups rolled into monthly backups;
(3) Monthly backups rolled into yearly files and kept for 7 years from the date
loan is paid off;
(4) Full daily backups of Cloud Data;
(5) Daily Cloud backups rolled up into Monthly files and moved out of the
Cloud into magnetic storage after 30 days;
(6) In the event of a natural disaster or catastrophic failure of CEE’s electronic
data system, CEE shall have a period not to exceed 45 days from the date of
such catastrophe to recover or reconstruct such lost data necessary for
compliance with its disaster recovery obligations.
*The Cloud Provider's policy is subject to change. CEE will notify Client of any
material changes in the event that they affect the security of the loan information.
9. Equal Opportunity Employment
CEE shall comply with all applicable provisions of the Equal Credit Opportunity Act (15 U.S.C.
§ 1691 et seq.). CEE is an equal opportunity employer and will not discriminate against any
person on the basis of race, color, creed, religion, sex, national origin, age, disability, marital
status, sexual orientation, status with regards to public assistance, or any other characteristic
protected by law.
10. Compliance
Vendors. From time to time, CEE may engage vendors to perform certain tasks that may be
included in CEE’s performance of the Services. CEE shall follow commercially-reasonable
practices designed to ensure that any Services performed by vendors are in compliance with the
Applicable Requirements and this Agreement.
Policies and Procedures. CEE will maintain and follow written internal policies and procedures
related to the Applicable Requirements in connection with providing services to Client, including
without limitation, policies and procedures for internal quality control, employee hiring and
training, and other methods that ensure compliance.
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Audit Rights. Client will have the right to audit CEE, at Client’s own expense and not more than
once per calendar year, for purposes of evaluating compliance with the terms of this Agreement.
CEE will provide full cooperation and will be responsible for assuring full cooperation by its
employees and vendors in connection with such audits. CEE shall cause any vendor that performs
tasks related to the Services to allow Client and its counsel, accountants, and other
representatives, as well as the applicable regulatory authorities of Client or the state of Minnesota,
reasonable access upon ten (10) business days advance written notice and only during normal
business hours, to all of CEE and vendors’ files, books and records directly relating to the
Services performed for Client under this Agreement. CEE will provide, and shall require all
vendors to provide, to Client, or obtain for Client, access to such properties, records, and
personnel as Client may reasonably require, and shall provide Client with CEE’s most recent
audited financial statements and the names, resumes, and proof of any required licensures for all
relevant personnel employed by CEE. The Client and its representatives and affiliates shall treat
all information obtained in such investigation that is not otherwise in the public domain as
confidential, pursuant to the Client’s obligation to comply with the Minnesota Government Data
Practices Act which shall supersede any contrary provision herein. CEE shall make financial
statement audits available to Client on an annual basis, including any SSAE -16 audits that may
be performed on behalf of CEE. CEE shall remit annual financial statement audit reports to Client
upon request.
11. Cooperation.
Client agrees that it shall (a) promptly deliver to CEE (i) any communications that Client receives
from a borrower relating to such borrower’s loan which is being serviced by CEE, and (ii) any
communication Client receives from any regulator, state of federal agency, or other governmental
entity relating to any borrower’s loan that is being serviced by CEE or otherwise relating to
CEE’s loan servicing activities, and (b) cooperate with CEE regarding any claim, dispute,
regulatory examination or investigation related to Client’s loans and the services provided to
Client by CEE under this Agreement.
12. Indemnity
CEE and Client each agree to indemnify, defend, and hold the other and each of their respective
officers, directors, employees, agents, counsel, advisors, and representatives (each, an
“Indemnified Party”) harmless from and against any and all claims, losses, penalties, fines,
forfeitures, legal fees and related costs, judgments, and any other costs, fees, and expenses
incurred by Indemnified Party arising out of any actions, demands, investigations, proceedings,
claims, counterclaims, or defenses, made by or on behalf of any third party related to the failure
of CEE or Client to perform its duties in compliance with the terms of this Agreement.
Notwithstanding the foregoing, n either party shall indemnify any such Indemnified Party if such
acts, omissions, or alleged acts giving rise to the Indemnified Party’s liability constitute fraud,
gross negligence, willful misconduct, or breach of fiduciary duty by such Indemnified Party.
Neither CEE nor Client shall have an obligation to appear with respect to, prosecute, or defend
any legal action which is not incidental to this Agreement. Nothing herein shall be interpreted as
a waiver or limitation of any defense or immunity available to Client, including but not limited to
the application of Minnesota Statutes, chapter 466.
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13. Taxes. Neither CEE nor Client shall be responsible to the other party for any taxes owed by such
party, including, without limitation, any federal, state, or local income or franchise taxes or other
taxes, imposed on or measured by income received by such party (or any interest or penalties with
respect thereto or arising from a failure to comply therewith) that are required to be paid by such
party in connection herewith to any taxing authority.
14. Reliance.
CEE and Client, and any director, officer, employee, or agent of CEE or Client respectively, may rely
on any document of any kind which it, in good faith, that party reasonably believes to be genuine and
to have been adopted or signed by the proper authorities or persons respecting any matters arising
hereunder.
15. Insurance
During the term of this Agreement, CEE will obtain and maintain insurance in the amounts listed
below:
General Liability $2,000,000 Aggregate Limit
Automobile Liability $1,000,000 Combined Single Limit
Excess Liability $1,000,000 Aggregate Limit
Professional Liability $1,000,000 Aggregate Limit
Workers Compensation Statutory Limit
16. Limitation of Liability
CEE’s role is strictly limited to the Services. Client will be solely responsible for making all
decisions concerning the management of the Client Loans. At all times, Client will be responsible
for the accuracy of all information provided to CEE, and CEE may rely on any document of any
kind which it, in good faith, reasonably believes to be genuine and to have been adopted or signed
by the proper authorities or persons respecting any matters arising hereunder. CEE’s duty is to
exercise ordinary care in its performance of the obligations described in this Agreement. Client
agrees that CEE, its officers, directors, agents, and employees (“CEE Representatives”) will not
be liable for events or circumstances arising from CEE’s reasonable reliance on such information
provided by Client. Client and CEE agree that clerical errors do not constitute a failure to exercise
ordinary care or to act in good faith. In addition to CEE's right to reasonably rely on information
provided to it by the Client, CEE shall not be held liable for any errors or omissions which were
created by the Client's previous loan servicer, except that CEE shall notify Client upon
discovering any such errors or omissions, and CEE and Client shall work together to address any
such issues.
17. Term of Agreement: Termination
The initial term shall commence on the Effective Date and continue for a period of three years
(the “Initial Term”). Thereafter, the Agreement shall automatically renew for successive one-year
periods, unless CEE or Client provides written notice of non-renewal or amendment to the other
party at least sixty days before the end of the then current term.
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Either Client or CEE may terminate this Agreement with respect to any Client Loan, or with
respect to all Client Loans, upon (a) ninety days prior written notice delivered to the other party
via email (and duly acknowledged by the other party) or (b) upon the occurrence of a CEE
Termination Event (as defined below). Upon such termination, CEE shall promptly supply
appropriate reports, documents, promissory notes, and other information as requested by Client or
any person or entity designated by Client and shall use its commercial best efforts to effect the
orderly and efficient transfer or servicing to the Client or a new servicer designated by Client
subject to the fees described in Exhibit B.
The following shall constitute a “Termination Event” under this Agreement:
A. Any failure by CEE to remit any payment required to be made under the terms of this
Agreement which continues for a period of ten business days after notice that such
payment was required to be made, provided, however, that any such failure shall not
constitute a Termination Event if such delay or failure could not have been prevented
by the exercise of reasonable diligence by CEE, or such delay or failure was caused
by events subject to conditions outside of the reasonable control of CEE; or
B. Any material breach by CEE or Client of their respective representations and
warranties contained herein that materially and adversely affects the interests of the
other, or any failure on the part of CEE or Client to observe or perform in any
material respect any of the covenants or agreements contained herein and which non-
performance continues for a period of thirty days after the date on which notice,
except for the case of non-payment as identified in paragraph A above, of such
breach has been given to by the non-breaching party to the breaching party.
Notwithstanding, if the breaching party certifies to the non-breaching party that it has
in good faith attempted to remedy such breach, such cure period will be extended to
the extent reasonably necessary to permit the breaching party to cure such breach; or
C. CEE or Client shall suffer a material adverse change in its financial condition that
affects its ability to perform its obligations under this Agreement; or
D. CEE or Client is subject to a bankruptcy or other proceeding relating to its liquidation
or insolvency, or a decree or order of a court or agency or supervisory authority
having jurisdiction for the appointment of a conservator or receiver or liquidator in
any insolvency, readjustment of debt, marshaling of assets and liabilities or similar
proceedings, or for the winding-up or liquidation of its affairs, shall have been
entered against CEE or Client and such decree or order shall have remained in force,
undischarged or un-stayed for a period of sixty (60) days; or
E. CEE or Client shall consent to the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshaling of assets or liabilities,
or similar proceedings of or relating to CEE or Client or of or relating to all or
substantially all of such party’s property; or
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F. CEE or Client shall admit in writing its inability to pay its debts as they become due,
file a petition to take advantage of any application insolvency or reorganization
statute, make an assignment for the benefit of its creditors, or voluntarily suspend
payment of its obligations.
18. Assignment of Rights
Neither party shall have any rights to assign its rights or obligations under this Agreement
without the prior written consent of the other party hereto.
19. Independent Contractor
Nothing herein shall be deemed or construed to create a co-partnership or joint venture between
the parties hereto and the services of CEE shall be rendered as an independent contractor and not
as an agent for Client, its successors and assigns, or any obligors or noteholders under the Client
Loans.
20. Amendments
This Agreement may not be amended or modified except by a written amendment signed by the
parties in interest at the time of such modification. Notwithstanding the foregoing, CEE may
adjust the Fees by providing an updated Exhibit B as provided herein and all other Schedules may
be changed by written mutual agreement.
21. Confidentiality
CEE acknowledges that Client is a government entity which is subject to the terms and provisions
of the Minnesota Government Data Practices Act, Minnesota Statutes, chapter 13 (the “Act”).
Additionally, the Client is subject to the terms of the Official Records Act, Minnesota Statutes,
section 15.17. To the extent that any of the provisions of this Agreement conflict or are
incompatible with any of the obligations of Client, in Client’s sole discretion, such provisions
shall be invalid and superseded by the appropriate law, rule, regulation, or interpretation and CEE
hereby releases Client from any claims related to Client’s compliance with such obligations.
Additionally, CEE acknowledges its obligation to comply with the Act, pursuant to Minnesota
Statutes, section 13.05, subd. 11.
Neither Client nor CEE shall disclose or use any Confidential Information of the other party or its
affiliates, and each party will keep such Confidential Information confidential and will require
that its affiliates, officers, employees, contractors, vendors, and advisors who have access to such
Confidential Information comply with such non-disclosure and non-use obligations.
Notwithstanding the forgoing, Client or CEE may provide such Confidential Information
as required pursuant to a court or administrative subpoena, court order or other such legal
process or requirement of law; provided, however, that it shall endeavor to promptly
notify the other of such request, order or requirement, unless such notice is prohibited by
statute, rule, or court order. Nothing herein shall require either Client or CEE to fail to
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honor a subpoena, court or administrative order, or a requirement of law on a timely
basis.
Notwithstanding this section, CEE is expressly permitted to release information to
borrowers upon written request regarding their specific loans; and, following receipt of
borrower’s written authorization to release information, CEE is expressly authorized to
release such information regarding that borrower's loan to a third party.
CEE shall cause vendors, if any, not to use or disclose any Confidential Information of
Client except in compliance with this Agreement. Notwithstanding the foregoing, a
vendor may disclose Confidential Information as required pursuant to a court or
administrative subpoena, order or other such legal process or requirement of law;
provided, however, that it shall first notify Client of such request or requirement, unless
such notice is prohibited by statute, rule or court order. CEE shall not, on Client’s behalf,
require a vendor to fail to honor a subpoena, court or administrative order, or a
requirement of law on a timely basis. CEE shall also cause vendors not to remove any
Confidential Information from Client premises without Client’s prior written
authorization.
Each party shall limit access to the other party’s Confidential Information to only those of
its employees and agents who require such access in performing their duties hereunder.
CEE agrees to either return the Confidential Information to Client or destroy the
Confidential Information upon completion of the work or, in any event, upon termination
of the Agreement between the parties. Except as expressly provided in this Agreement,
no ownership or license rights are granted in any Confidential Information.
Notwithstanding anything to the contrary in this Agreement, Confidential Information
may be disclosed to a party’s accountants, attorneys, insurers, regulators and consultants.
Notwithstanding the foregoing, a party may retain one archival copy of Confidential
Information that may be used solely to demonstrate compliance with this Agreement,
Applicable Law, and internal policies and procedures.
“Confidential Information” for purposes of this Agreement, shall mean any information
of CEE, Client, or their respective affiliates, whether written or oral, including:
A. Financial Information, marketing plans, and personnel records;
B. Technical and non-technical data, including without limitation, customer
lists, customer information, costumer non-public information, fee schedules,
forms, information, business and management methods, trade secrets,
compilation and analysis of financial information and data to prepare and
submit bids and proposals to third parties;
C. Other proprietary or confidential information;
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D. Proprietary computer software, management information and information
systems, whether or not such Confidential Information is disclosed or
otherwise made available to one party or other pursuant to this Agreement.
“Confidential Information” shall not include the following:
A. Information that is or becomes generally available to and known by the
public (other than as a result of an unpermitted disclosure directly or
indirectly by the receiving party or its affiliates, advisors, or representatives);
B. Information that is or becomes available to the receiving party on a non-
confidential basis from a source other than the disclosing party or its
affiliates, advisors, or representatives, provided that such source is not and
was not bound by a confidentiality agreement with or other obligation of
secrecy to the disclosing party of which the receiving party has knowledge at
the time of the disclosure; or
C. Information that has already been or is hereafter independently acquired or
developed by the receiving party without violating any confidentiality
agreement with or obligation secrecy to the disclosing party.
22. Attorney In-Fact. To enable CEE to carry out its obligations under this Agreement, Client hereby
(a) authorizes CEE (and its third-party contractors) on behalf of Client to communicate as
Client’s agent with (i) borrowers, guarantors, and others obligated in connection with a
Loan by electronic means or otherwise, (ii) credit reporting bureaus and consumer
reporting agencies selected by CEE, and (iii) to do or perform any other acts for purposes
of carrying out its obligations hereunder, and
(b) appoints CEE as Client’s lawful attorney in fact to sign in the name of Client on such
documents as are necessary or appropriate for CEE to perform its obligations as
contemplated under this Agreement, including without limitation checks and other
documents necessary to process payments, proof of claims, and such other documents as
Client may approve in writing, which approval shall not be unreasonably withheld or
delayed. For the avoidance of doubt, such power-of-attorney shall be revocable, in whole
or in part, at the sole discretion of Client; provided that, upon any such revocation, CEE
shall not be liable for failure to perform any obligations under this Agreement for which
such power-of-attorney is necessary, and such failure may be considered by CEE in its
sole discretion as a basis on which to terminate this Agreement.
23. Transfers. Client shall provide CEE with all authorizations and information, and shall take all such
further steps as may be necessary, in order to authorize and enable CEE to initiate the movement of
funds by automated clearing house (“ACH”) or other electronic funds transfer.
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24. Notices
All notices and communications as part of this Agreement must be in writing and, except as
otherwise agreed in writing, must be delivered, mailed, faxed, or emailed, to the following
addresses:
If to CEE:
Center for Energy and Environment
rd
212 3 Avenue North, Suite 560
Minneapolis, MN 55401
Attn: Ryan Ellis
Phone: 612.335.5862
Email: rellis@mncee.org
If to Client:
Mounds View EDA
2401 Mounds View Boulevard
Mounds View, MN 55112
Attn: Brian Beeman
Phone: 763.717.4029
Email: brian.beeman@ci.mounds-view.mn.us
25. Governing Law
This Agreement and each transaction consummated hereunder shall be deemed to be made under
the internal laws of the State of Minnesota and shall be construed in accordance with and
governed by the laws of the State of Minnesota, without regard to the choice of law rules of that
state, except to the extent that any such laws may now or hereafter be preempted by Federal law.
26. Counterparts
This Agreement may be executed in several counterparts, each which shall be deemed an original,
and all of which shall together constitute one and the same instrument.
27. Force Majeure
CEE and Client shall be excused from performing in accordance with this Agreement in the event
of an occurrence of “Force Majeure”. Force Majeure is defined as fire, floods, earthquake,
tornado, explosion, catastrophe, accident, war or war-like operations (whether or not a state of
war is declared), riot, Acts of God, acts of terrorism, insurrection, order of a Governmental Body
and applicable laws that prevent performance, to the extent (i) such event of Force Majeure is
beyond the reasonable control of the Party claiming Force Majeure, and (ii) the Party claiming
Force Majeure gives prompt written notice of the same to the other Party. In the event of any
such delay, the sole remedy shall be a time extension for the completion dates required by the
Agreement, which extension shall be the time period lost by reason of the Force Majeure.
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28. Entire Agreement
This Agreement, including all exhibits incorporated herein, constitute the entire agreement among
the parties with respect to the subject matter of this Agreement and supersede all other prior
agreements and understandings, both written and oral, among the parties to this Agreement with
respect to the subject matter of this Agreement. In the event of any inconsistency between the
statements in the body of this Agreement and any exhibits, the statements in the body of this
Agreement will control.
29. Authorized Persons
CEE will provide a single login user name and password (together with any Client created user
name and/or password, collectively the “Credentials”) to Client for purposes of accessing CEE’s
system (“Portal”) to obtain reporting regarding Client Loans. Client is encouraged to create its
own unique Credentials for use in accessing the Portal promptly after receipt of Credentials from
CEE. Client shall be solely responsible for the use and protection of the Credentials. Client
agrees to maintain the confidentiality of the Credentials.
Client agrees that it shall be liable for all transactions initiated and authorized by means of the
Credentials, whether or not actually authorized by the Client. Client further agrees that any
person using the Credentials to access the Portal shall be deemed to be duly authorized by Client
and such person using the Credentials shall be deemed to have full authority to act on behalf of
Client. Client agrees to maintain a proper and complete log of individuals to whom it has
provided access to Client portal and receipt of reports with respect to Client Loans or Client
reports. Client shall promptly modify the Credentials in the event that any person to whom it has
given the Credentials is no longer employed by or otherwise affiliated with Client.
Client shall appoint one or more officers or employees who are authorized to act on behalf of
Client regarding this Agreement and the services provided by CEE hereunder (“Authorized
Users”). CEE shall not be responsible for any correspondence with or access provided to any
Authorized User. Client may add or remove Authorized Users by written notice to CEE. CEE
may rely on any action taken by an Authorized User until an Authorized User’s authorization has
been revoked by Client by written notice to CEE. CEE shall have a reasonable time to process
any revocation received pursuant to this section.
Client agrees that the failure to protect Credentials may allow an unauthorized party to (i) use the
services provided by CEE, (ii) access Client’s electronic communications and financial data, and
(iii) send or receive information and communications on behalf of the Client. Unencrypted
electronic transmissions are not secure, and Client assumes the entire risk for unauthorized use of
Credentials and any unencrypted electronic transmissions. Client undertakes no obligation to
monitor transactions initiated by valid Credentials to determine that they are made on behalf of or
authorized by Client.
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30. Record's
Except to the extent otherwise required by Applicable Law, CEE shall retain all records relating
to a Client Loan for at least one (1) year following termination of this Agreement or one (1) year
from maturity or payoff of a Client Loan unless such documentation is requested by and delivered
to Client at an earlier date. The records will be maintained in either hard copy or machine-
readable (electronic) format. In the event CEE is no longer in existence, its successor shall
continue to retain such records as provided above or deliver the records to Client.
31. Deconversion
In the event of termination of this Agreement, CEE will continue to service all existing Client
Loans at the time of termination, at the fees in place at the time of termination. If Client desires to
transfer the duties under this Agreement to a new servicer, CEE agrees to provide Client with
electronic copies of the Client Loan records in CEE's standard format at the current rate being
charge on a per loan charge by CEE, as well as any additional time charged on a per hour basis.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date written below.
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MOUNDS VIEW EDA
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EXHIBIT A TO
LOAN SERVICING AGREEMENT
Duties of Servicer
NEW LOAN SET UP
Loan Boarding
CEE will board the loan upon origination into CEE’s servicing system. For any unsecured loan,
CEE will board the new loan within three (3) Business days of origination. For any secured loan,
CEE will board the new loan within three (3) Business days after the expiration of the right of
rescission. CEE will confirm the funding pool and assure that the new loan draws off the correct
pool.
For purposes of this Agreement, “business days” means calendar days other than weekends,
official federal holidays, and non-banking holidays.
Reporting
CEE will report every loan to at least one of the three major credit agencies upon inception as it
may designate in its sole discretion.
Quality Control Review
The loan and ACH entry instruction will be reviewed prior to activation to verify the servicing
system matches the terms of the promissory note and any other programmatic requirements per
the documents submitted.
Welcome Letter
A welcome letter will be sent to borrowers within five (5) business days after boarding. This
letter shall include the toll free customer service number as well as an email address that is
available for borrowers to use should they have a question regarding their loan. Customer service
is available from 8:00 AM to 4:30 PM Central Time, on “business days”. An automatic ACH
enrollment form is included in the letter for borrowers to complete and return to CEE if they
would like recurring payments to be initiated automatically by CEE. The letter will also contain
instructions for borrowers to receive access to the online loan portal where they have access to all
their loan information and ability to make payments.
STANDARD SERVICING –AMORTIZING/DEFERRED
Billing
Borrowers with loans that have regularly scheduled payments will receive billing statements on a
monthly basis or other appropriate frequency based on terms of the promissory note.
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Collection of Loan payments
CEE shall collect payments of principal, interest and any appropriate fees. CEE shall confirm the
application of payments to be consistent with the loan documents as part of ongoing due
diligence.
Customer Service
CEE shall provide customer service to borrowers from 8:00AM – 4:30 PM Central Time on
“business days”. The customer service team is available through the toll free phone number or
email at loanservicing@mncee.org. Borrowers will receive a response within five (5) business
days following a question submitted to CEE. Borrowers are able to view loan information on the
loan portal as well as schedule payments.
Past Due Collections
CEE will make reasonable efforts to maintain loans in a current status and will deal promptly
with those which are delinquent in accordance with the Collection Activity section below. CEE
will process loan defaults as directed by Client.
Reporting
CEE will provide standard monthly reporting for the prior month’s activities to Client no later
than the 10th business day of each month. The standard reports are as listed:
o Loan Trial Balance
o Aged Delinquency
o Principal and Interest Collections
o New Loan
o Paid Loan
o Fee Scheduled
o Fee Earned
Special reports may be added at an additional cost for programming. (See Exhibit B for pricing)
IRS Reporting
CEE shall provide borrowers with the required IRS annual tax reporting.
Funds Remittance
CEE shall remit collected funds less servicing and other applicable fees and any late charges
assessed to borrower by the 10th business day of the month. Late charges will be retained by
CEE. Funds will be remitted via ACH. An invoice will be distributed detailing the servicing fees.
CEE shall remit such funds by means of ACH or other electronic funds transfer to an account
designated by Client.
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COLLECTION ACTIVITY
Early Delinquency
CEE will make reasonable efforts to maintain loans in a current status and will make reasonable
periodic efforts to contact borrowers who are delinquent, in order to encourage payment. Such
efforts will be limited to those loans that are no more than 90 days past due.
o CEE will follow customary, usual and prudent business practices in servicing
delinquent loans.
o CEE will send delinquency letters for loans 31- 60 days past due.
o CEE will continue sending letters and begin phone calls for loans 61-90 days past
due.
Late Delinquency
CEE will make reasonable efforts to contact Borrowers, solicit payments, and return loans to a
current status, where the loan has reached 90 or more days past due, in order to encourage
payment.
o CEE will follow customary, usual and prudent business practices in servicing
delinquent loans.
o CEE will send formal default letters for loans reaching 120 or more days past
due.
o CEE shall continue phone calls to borrower at 90 days past due.
o After 120 days past due, Client shall determine next steps and CEE shall have no
obligation to take further action regarding delinquent loans until directed by
Client.
DEFAULT MANAGEMENT
Client shall be solely responsible for declaring a loan to be in default, and determining whether a loan is
to be charged-off.
Loan Modifications
CEE shall respond to Client or Borrower requests for modifications to their loan terms, including
Repayment Plans, Forbearance Agreements, Deferments, Extensions, Short Sales (Pre-
Foreclosure Sales), or Negotiated Releases of collateral, obligors or guarantors (each a “Loan
Modification”).
CEE shall make no decisions independent of the Client. Client shall have final approval of any
Loan Modifications, unless Client has instructed CEE in writing that it may approve Loan
Modifications pursuant to criteria established by Client.
CEE will follow customary, usual and prudent business practices in its review and processing of
Loan Modifications, and keep Client informed of the status of such requests.
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Both Client and CEE recognize that time is of the essence in responding to and approving or
declining Loan Modification requests.
CEE shall monitor Borrowers for compliance with the terms of the loan modification and make
such changes to the loan record as required by the modification terms.
Special Servicing
CEE shall perform special servicing actions and steps at the direction of the Client for loans
subject to formal legal proceedings, including Bankruptcy, Foreclosure, Deed-in-lieu of
Foreclosure, Collections suits, Repossession, and Charge-offs involving either an obligor(s) or
guarantor(s).
CEE shall make no decisions or take actions independent of the Client, who shall have
final say in approval of any Special Servicing actions (other than routine steps taken to
protect or preserve Clients interests), unless Client has instructed CEE in writing that it
may approve and take such actions.
CEE must employ staff with expertise in the above areas and maintain compliance with
all applicable regulations.
CEE will follow customary, usual and prudent business practices in its review, processing, and
management of Special Servicing of Client loans, and keep Client informed of the status of loans
subject to Special Servicing.
Both Client and CEE recognize that time is of the essence in responding to and approving or
declining Special Servicing Actions.
CEE shall monitor Borrowers who are subject to Special Servicing, consistent with the governing
legal proceedings or requirements, and make such changes to the loan record as required to reflect
the Special Servicing requirements. With respect to Bankruptcy, the Special Servicing shall
include Filings, Proof of Claim, Repayment Plan setup and monitoring, and discharge/completion
processing. (See Exhibit B for pricing)
Other Servicing
CEE shall perform the following additional servicing actions and steps for loans as requested
by Client. CEE will follow customary, usual and prudent business practices in providing these
services. The Client shall bear all of CEE’s out of pocket costs for third parties related to these
items. CEE will notify Client of the potential out of pocket costs prior to performing any of the
additional actions.
o REO Marketing
o Insurance Inspections
o Default Inspections
o Property Valuation or Appraisal
o Property Preservation and security
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SUBORDINATION PREPARATION
CEE will review subordination requests in accordance with the Client’s subordination program
requirements. Subordinations will be forwarded to the Client for signature if request meets the
program requirements. Fees related to the subordination are paid by borrowers.
MORTGAGE SATISFACTION PREPARATION
Loan Payoffs
CEE will process loan payoffs, issue payoff statements as requested by authorized individuals
within 30 calendar days and remit funds to Client. CEE shall draft mortgage satisfactions
(“Satisfaction”) within 30 calendar days after loan is paid in full to ensure funds received are
cleared. The Satisfaction is then sent to client for signature. CEE shall provide instructions to
borrowers as to how to properly record the Satisfaction. In the event that $5 (five dollars) or less
of principle balance remains, CEE and Client will not attempt to collect the remaining fee and
will consider the loan as satisfied.
FINAL/SPECIAL PROCESSING TRANSACTIONS
CEE shall charge additional fees in special circumstances such as a charge-off, foreclosure,
servicing release, or any other transaction that is processed on a loan that is not paid in full but is
no longer an active loan on the servicing system. This does NOT include processing a paid in full
transaction.
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EXHIBIT B TO
LOAN SERVING CONTRACT
Pricing Schedule
Activity Description Pricing
Loan Boarded to servicing system and
New Loan Setup $ 20.00 one-time fee per loan
quality control review, welcome letter
Payment processing, billing notices,
Standard Servicing Activities –
$10.00 per loan per month
customer service, investor reporting,
Amortizing Loans
early collections
Standard Servicing Activities- Payment processing, customer service,
$0 per loan per month
Deferred Loans investor reporting
Collection Work for loans past due $5.00 per loan per month on all
Collection Activity
15-90 days amortizing loans
Example of activities: Repayment $80.00 per hour plus any charges that
rd
Default Management
Plan, Forbearance Agreement, may be incurred from 3 party
Deferment, Extension vendor.
Review request and Prepare
Subordination Preparation $150.00 per request (Borrower Paid)
subordination document
Create mortgage/deed of trust
Mortgage/Deed of Trust Satisfaction
$30.00 one-time fee per loan
satisfaction (excludes recording /
Preparation
filing fees)
For Charge-off, foreclosure, service
Final /Special Processing Transaction release, loans not paid in full but no $25.00 per transaction
longer active on the servicing system
Boarding Loans previously serviced
Conversion/On-Boarding $20.00 one-time fee per loan
by a different company
Optional/Additional Services
Special report creation not included in
Special Report Programming $150.00 one time fee per report
standard report package
Monthly maintenance for special
Special Reporting Distribution $75.00 one time fee per report
reports created for distribution
Special requests, such as assistance in $80.00 per hour plus any charges that
Special Project work
rd
audit preparation, special mailings may be incurred from 3 party
etc... vendor.
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Any additional activities required $80.00 per hour, fee will be set
Non Standard Servicing Activities
for servicing a loan not specified in based on time to complete task on
contract a regular basis
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