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10/08/1992 - Housing and Redevelopment Authority HOUSING & REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF EAGAN October 8, 1992 6:30 p.m. AGENDA • I. Resolution Providing for Subordination of Mortgage Securing Interest Rate Reduction Loan for Cinnamon Ridge Project II. Other Business • /-0)—/V A)/7/c/ NOTICE OF SPECIAL MEETING THE HOUSING & REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF EAGAN, MINNESOTA Notice is hereby given that the Board of Commissioners of the Housing & Redevelopment Authority in and for the City of Eagan, Minnesota (the HRA), will hold a special meeting at the Eagan City Hall on Thursday the 8th day of October, 1992, at 6:30 o'clock p.m. The purpose of the meeting is to consider action relating to the refinancing by the City of Eagan of the Cinnamon Ridge Housing Project, including the subordination of the HRA's mortgage securing its interest rate reduction loan to other financing documents, and any other business which may properly come before the Board. /s/ Thomas L. Hedges Executive Director HOUSING & REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF EAGAN October 8, 1992 6:30 p.m. AGENDA I. Resolution Providing for Subordination of Mortgage Securing Interest Rate Reduction Loan for Cinnamon Ridge Project II. Other Business The City of Eagan is committed to the policy that all persons have equal access to its programs,services,activities,facilities and employment without regard to race,color,creed, religion, national origin, sex, disability, age, marital status or status with regard to public assistance. Auxiliary aids for persons with disabilities will be provided upon advance notice of at least 96 hours. If a notice of less than 96 hours is received, the City of Eagan will attempt to provide such aid. NOTICE OF SPECIAL MEETING THE HOUSING & REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF EAGAN, MINNESOTA Notice is hereby given that the Board of Commissioners of the Housing & Redevelopment Authority in and for the City of Eagan, Minnesota (the HRA), will hold a special meeting at the Eagan City Hall on Thursday the 8th day of October, 1992, at 6:30 o'clock p.m. The purpose of the meeting is to consider action relating to the refinancing by the City of Eagan of the Cinnamon Ridge Housing Project, including the subordination of the HRA's mortgage securing its interest rate reduction loan to other financing documents, and any other business which may properly come before the Board. /s/ Thomas L. Hedges Executive Director • THE HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF EAGAN, MINNESOTA RESOLUTION NO: WHEREAS: A. The City Council of the City of Eagan pursuant to a notice published in advance as required by state and federal law, conducted a public hearing held on October 8, 1992 on the proposal to refinance its $11,350,000 Multifamily Housing Redevelopment Bonds (Cinnamon Ridge Project) Series 1985 (the "Prior Bonds") and by a resolution adopted on October 8, 1992 approved the issuance by the City of its: (a) Multifamily Housing Revenue Refunding Bonds (Cinnamon Ridge Project) , Series 1992 in an aggregate principal amount not to exceed $8, 000, 000 (the "Bonds") , and (b) Multifamily Housing Revenue Second Mortgage Refunding Note of 1992 (Cinnamon Ridge Project) in an aggregate principal amount not to exceed $3,245, 000 (the "Note") , and B. In connection with the issuance of the Series 1985 Bonds, The Housing and Redevelopment Authority of the City of Eagan, Minnesota (the "Authority") passed a Resolution dated June 18, 1985, establishing a tax increment financing district pursuant to Minnesota Statutes, Sections 273.71 to 273 .78, and approved a Tax Increment Financing Plan for the Cinnamon Ridge Housing Project and undertook an interest reduction program pursuant to Minnesota Statutes, Section 462.445, Subdivisions 10 through 13 to reduce the effective rate of interest on a Mortgage Loan made to the Developer; and C. The Developer entered into an Interest Rate Reduction Loan Agreement for the purpose of providing for the terms and conditions of the interest rate reduction tax increment assistance to be provided to the Cinnamon Ridge Housing Project (the "Development") in connection with the financing of the construction of the Development. Two mortgages were executed by Cinnamon Ridge Limited Partnership (the "Developer") in connection with the financing of the Development. The first mortgage (the "First Mortgage") was entered into by the Developer in favor of the Trustee for the Prior Bonds and Mellon Bank, N.A. (the issuer of the letter of credit which secured the Prior Bonds) , jointly, and the second mortgage (the "Second Mortgage") was entered into by the Developer in favor of the Authority securing the payment by the Developer of its obligations pursuant to the Interest Rate Reduction Loan Agreement; and D. The Developer now proposes to refinance the Development through the issuance of the Bonds and the Note, as well as through certain additional debt incurred by the Developer to Mellon Bank, N.A. and in connection therewith has requested the Authority to subordinate its interests under the Second Mortgage to the liens and security interests securing the Bonds, the Note and Mellon Bank; and E. The Second Mortgage, and the obligation of the Developer to pay the First Note and the Second Note (as defined in the Interest Rate Reduction Loan Agreement) shall be subordinate to: i) The Mortgage, Fixture Financing Statement and Security Agreement entered into by the Developer in favor of First Trust National Association, as trustee for the Bonds, and Mellon Bank, N.A. (as issuer of the letter of credit securing the Bonds) , jointly, relating to the Bonds and secured by the Bonds; ii) The Mortgage and Security Agreement entered into by the Developer in favor of Mellon Bank, N.A. to secure the Note; and iii) The Mortgage and Security Agreement entered into by the Developer in favor of Mellon Bank, N.A. to secure a promissory note to be dated on or about October 29, 1992 and to be made by the Developer to Mellon Bank, N.A. in the approximate principal amount of $1, 000,000 (the "Taxable Note") . NOW THEREFORE, BE IT RESOLVED by The Housing and Redevelopment Authority of the City of Eagan, Minnesota: 1. The Authority hereby agrees to subordinate the liens and security interests in its favor under the Second Mortgage to the liens and security interests in favor of First Trust National Association, as trustee for the Bonds, and Mellon Bank, N.A. , as the holder of the Note and the Taxable Note and as issuer of the letter of credit securing the Bonds. The subordination approved hereby shall extend to all liens, encumbrances and security interests in favor of the Authority against or related to the Development, whether encumbrances on real property and improvements, or security interests in equipment, fixtures, leases and rents (or proceeds thereof) or intangibles. The subordination approved hereby shall extend only to the liens, encumbrances and security interests securing the debt evidenced by the Bonds, the Note and the Taxable Note, and to no other debt of the Developer whatsoever. 2 . The Executive Director of the Authority is hereby authorized and directed to enter into, execute and deliver on behalf of the Authority such agreements or other instruments as may be necessary or desirable for the purpose of effectuating the intent of the resolution, upon approval of the form of such agreements or instruments by legal counsel to the Authority. The Executive Director and Secretary of the Authority are hereby further authorized and directed to provide to the Developer, First Trust National Association, Mellon Bank, N.A. and the title 2 • E insurance company providing insurance with respect to the mortgages in favor of them a certified copy of this resolution and such other evidence as may be reasonably requested of the action taken hereby and the authority of the officers and Executive Director of the Authority to carry out this resolution. Adopted by the Board of Commissioners of The Housing and Redevelopment Authority of the City of Eagan, Minnesota on October , 1992. BJS\EAGAN\hra.res 3