RES 14-01 RESOLUTION NO. 14-0I
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A RESOLUTION OF THE ECONOMIC DEVELOPMENT AUTHO RITY
OF THE CITY OF ELK RIVER, COUNTY OF SHERBURNE,
STATE OF MINNESOTA, APPROVING SECURITY INTEREST SUBORDINATION
AGREEMENT AND MORTGAGE SUBORDINATION AGREEMENT
Section 1. Recitals.
1.01 The Board of Commissioners (the "Board") of the Economic Development
Authority of the City of Elk River (the "EDA") has heretofore provided a Microloan in the amount
of $100,000 and a Forgivable Loan Program loan in the amount of $200,000 to Preferred Powder
Coating, LLC, a Minnesota limited liability company, and Preferred Real Estate Holding, LLC, a
Minnesota limited liability company (both collectively and individually referred to as "Debtor")
. which were secured by certain mortgages and security agreements on a subordinate basis to a loan
from First National Bank of Elk River (the "Bank") in the original principal amount of$5,093,000.
1.02 The Debtor has requested an additional loan from the Bank in the amount of
$386,000 and the Bank has required, as a condition to making such additional loan, that the Debtor
obtain from the EDA a Security Interest Subordination Agreement (the "Security Interest
Agreement") in favor of the Bank and a Subordination Agreement in favor of the Bank (the
"Subordination Agreement" and together with the Security Interest Agreement the "Agreements"),
providing for the subordination of the EDA's mortgages and security agreements to the Bank's
• mortgages and security agreements with respect to the additional financing, copies of which are on
file with the Executive Director.
NOW THEREFORE, BE IT RESOLVED by the Board of Commissioners (the "Board") of the
Economic Development Authority of the City of Elk River (the"EDA") as follows:
Section 2. Approval of Agreements.
2.01. The Agreements as presented to the EDA are hereby in all respects approved, in
substantially the forms submitted, together with any related documents necessary in connection
therewith, and the President and Executive Director are hereby authorized and directed to execute the
Agreements on behalf of the EDA and to carry out, on behalf of the EDA, the EDA's obligations
thereunder.
2.02. The approval hereby given to the Agreements includes approval of such additional
details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom
and additions thereto as may be necessary and appropriate and approved by legal counsel to the EDA
and by the President and Executive Director prior to executing said documents; and said officers are
hereby authorized to approve said changes on behalf of the EDA. The execution of any instrument by
the President and Executive Director shall be conclusive evidence of the approval of such document in
accordance with the terms hereof. In the event of absence or disability of said officers, any of the
documents authorized by this Resolution to be executed may be executed without further act or
authorization of the Board by any duly designated acting official, or by such other officer or officers of
• the Board as,in the opinion of the City Attorney,may act in their behalf.
443799v1 JSB EL185-22
Approved by the Board of Commissioners of the Economic Development Authority of the
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City of Elk River this 19th day of May, 2014.
Gam- _
Dan Tveite,President
ATTEST:
die
Brian Bee 7, Director
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443799v1 JSB EL185-22