Farmers State Bank and the Dean V. Kruse National Military History Center museum in Auburn have reached an agreement in a foreclosure case that will allow the museum to remain open to the public.
The agreement cancels a sheriffs sale scheduled for late September.
On July 11, DeKalb Superior Court Judge Monte L. Brown awarded a judgment of $2.9 million to Farmers State Bank of LaGrange and against the Dean V. Kruse Foundation, which operates a World War II museum, as well as the Kruse Automotive and Carriage Museum.
As part of that judgment, Brown ordered the property, which includes 28.27 acres at DeKalb County Road 11A and General Doolittle Drive, as well as the buildings and their fixtures, to be sold at a sheriffs sale.
According to a statement issued Thursday by the Dean V. Kruse Foundation, some of the requirements set by the bank have been met, and a payoff plan presented by the foundation to the bank could lead to the foundation becoming debt-free within months.
The plan includes the sale of what officials call the Granatelli building – a completed structure near the larger museum built to house the memorabilia of former race car owner Andy Granatelli.
The foundation defaulted on the loan to build that museum, which fell through when Granatelli changed his mind about the location, wanting it closer to Indianapolis. No agreement between Dean Kruse, the non-profit foundation that bears his name, or Granatelli had been in writing, except for the mortgage.
The Granatelli building, brand new and 22,500 square feet, will be auctioned off at 4 p.m. Sunday. The foundation has invested nearly $3.1 million in the building, according to the statement.
The winning bidder must provide $100,000 in earnest money or 10 percent of the purchase price, according to the release.
Financially embattled in recent years and stripped of his auctioneering license, Kruse has been unable to continue to contribute as much capital to the ongoing operation of the museums, officials said after the museum was foreclosed upon.
Kruse bought the property, secured the collection from a museum in Belgium near the site of the Battle of the Bulge and gave the foundation enough cash to operate the museum.
Some of that inventory will also be auctioned off to meet the demands of the bank settlement, according to the statement.
That auction is scheduled for 10 a.m. Nov. 24, and officials said it could become an annual fundraiser for the museum and a decision is being reached on whether to accept consignments, according to the statement.