Loading...
HomeMy WebLinkAboutCity Council Resolution 2020-162 C ITY OF P LYMOUTH R ESOLUTION N O. 2020-162 R ESOLUTION A PPROVING S UBORDINATION OF THE M ETROPOLITAN C OUNCIL L OCAL H OUSING I NCENTIVES A CCOUNT L OAN TO FACILITATE R EFINANCING OF 1020 W EST M EDICINE L AKE D RIVE WHEREAS, Plymouth Leased Housing Associates, Limited Partnership (“Owner”) is the owner of real property located at 1020 West Medicine Lake Drive in Plymouth, Minnesota (“Property”). The Stone Creek at Medicine Lake Apartments is a 132-unit multi- family rental housing project located on the Property, which project was completed in 2004; and WHEREAS, the Property contains 34 affordable units at 30-50% AMI and 98 luxury market rate units; and WHEREAS, the Property signed a 30-year Low Income Housing Tax Credit (“LIHTC”) Land Use Restrictive Agreement (“LURA”) for all 34 units and a 40 year restriction on 13 Metropolitan Housing Opportunities Program units with the Minneapolis Public Housing Authority; and WHEREAS, the Property was financed with Fannie Mae first mortgage loan at 6.5%, and a series of subordinate deferred loans from Hennepin County, the City of Plymouth, the Family Housing Fund and Minnesota Housing Finance Agency; and WHEREAS, the City and Owner entered into Loan Agreement (“City MET Loan Agreement”) dated April 1, 2003 in which the City made a loan to Owner in the principal amount of $200,000 (“City MET Loan”) and Owner provided to the City a Mortgage on the Property as security for the City MET Loan; and WHEREAS, Owner has recently received a loan proposal from Bridgewater Bank (“Bridgewater”) for 18.2 million (65% loan to value ration) to refinance the existing Fannie Mae loan, for the purposes of: (i) paying corporate staff; (ii) paying pre-development costs on development projects currently in the pipeline; and (3) supporting operations of existing affordable housing projects; and WHEREAS, the Bridgewater loan interest rate is 4% interest resulting in a debt service that is less than the existing Fannie Mae debt service; and WHEREAS, the Broker Options of Value generally indicate values for the project and Property in the range of $28-$30 million, which indicates an adequate value to support the loan; and WHEREAS, as a condition of the loan, Bridgewater is requiring that the City and current subordinated lenders to the Fannie Mae loan execute the subordination agreement attached hereto as Exhibit A; and WHEREAS, city staff have reviewed the subordination agreement and recommend execution by the City. NOW, THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF THE CITY OF PLYMOUTH, MINNESOTA that the Subordination Agreement attached hereto as Exhibit A is approved and the Mayor and City Manager are authorized to execute the agreement. APPROVED by the City Council on this 26th day of May, 2020. STATE OF MINNESOTA) COUNTY OF HENNEPIN) SS. The undersigned, being the duly qualified and appointed City Clerk of the City of Plymouth, Minnesota, certifies that I compared the foregoing resolution adopted at a meeting of the Plymouth City Council on May 26, 2020 with the original thereof on file in my office, and the same is a correct transcription thereof. WITNESS my hand officially as such City Clerk and the Corporate seal of the City this ___________day of __________________, __________. ____________________________________ City Clerk EXHIBIT A SUBORDINATION AGREEMENT MASTER SUBORDINATION AGREEMENT THIS MASTER SUBORDINATION AGREEMENT (“Agreement”) is entered into this ____ day of May, 2020, by and among (i) BRIDGEWATER BANK, a Minnesota banking corporation (“Senior Lender”), (ii) CITY OF PLYMOUTH, MINNESOTA, a public body corporate and politic (the “City”), (iii) HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF PLYMOUTH, a public body corporate and politic (the “City HRA”); (iv) COUNTY OF HENNEPIN, a political subdivision of the State of Minnesota on behalf of the Hennepin Housing Consortium, a joint powers consortium (the “County”); and (v) HENNEPIN COUNTY HOUSING AND REDEVELOPMENT AUTHORITY, a political subdivision of the State of Minnesota (“County HRA”). RECITALS A. Plymouth Leased Housing Associates, Limited Partnership, a Minnesota limited partnership (“Borrower”) is the owner of certain land located at 1020 West Medicine Lake Drive in Plymouth, Minnesota, and legally described in Exhibit A (“Land”). The Land is improved with a 132-unit multifamily rental housing project (“Improvements” together with the Land shall be collectively referred to as the, “Mortgaged Property”). B. Senior Lender has agreed to extend a loan in the original principal amount of $18,200,000.00 to the Borrower (the “Senior Loan”), which is evidenced pursuant to a Promissory Note executed by the Borrower in favor of Senior Lender in the amount of $18,200,000.00 (the “Senior Note”), the proceeds of which shall be disbursed to Borrower pursuant to the terms of a Loan Agreement by and between Borrower and Senior Lender of even date herewith (the “Senior Loan Agreement”), in connection with the Mortgaged Property. The Senior Loan is secured in part by a Combination Mortgage, Security Agreement, Fixture Filing and Assignment of Leases and Rents of even date herewith executed by the Borrower in favor of the Senior Lender, encumbering the Mortgaged Property (the “Senior Mortgage”). C. Pursuant to a Loan Agreement dated as of April 1, 2003 between the City and Borrower (“City MET Loan Agreement”), the City made a loan to Borrower in the original principal amount of $200,000.00 (“City MET Loan”). The City MET Loan is secured by a Mortgage dated April 1, 2003 executed by the Borrower in favor of the City, encumbering the Mortgaged Property, recorded on April 24, 2003 with the Hennepin County Registrar of Titles’ Office as Document No. T3724632 (the “City MET Mortgage”). D. Pursuant to a Loan Agreement between the City HRA and Borrower dated as of April 1, 2003 between the City HRA and Borrower (“City HRA TIHAP Loan Agreement”), the City HRA made a loan to Borrower in the original principal amount of $236,000.00 (“City HRA TIHAP Loan”). The City HRA TIHAP Loan is secured by a Mortgage dated April 1, 2003 executed by the Borrower in favor of the City HRA, encumbering the Mortgaged Property, recorded on April 24, 2003 with the Hennepin County Registrar of Titles’ Office as Document No. T3724630 (the “City HRA TIHAP Mortgage”). E. Pursuant to a Loan Agreement dated as of April 1, 2003 between the City HRA and Borrower (“City HRA AHFP Loan Agreement”), the City HRA made a loan to Borrower in the original principal amount of $130,000.00 (“City HRA AHFP Loan”). The City HRA AHFP Loan is secured by a Mortgage dated April 1, 2003 executed by the Borrower in favor of the City HRA, encumbering the Mortgaged Property, recorded on April 24, 2003 with the Hennepin County Registrar of Titles’ Office as Document No. T3724631 (the “City HRA AHFP Mortgage”). F. Pursuant to a Loan Agreement dated as of April 1, 2003 between the County and Borrower (“County Loan Agreement”), the County made a loan to Borrower in the original principal amount of $400,000.00 (“County Loan”). The County Loan is secured by a Combination Mortgage, Assignment of Rents, Security Agreement, and Fixture Financing Statement dated April 1, 2003 executed by the Borrower in favor of the County, encumbering the Mortgaged Property, recorded on April 24, 2003 with the Hennepin County Registrar of Titles’ Office as Document No. T3724626 (the “County Mortgage”). G. Pursuant to a Loan Agreement dated as of April 1, 2003 between County HRA and Borrower (“County HRA Loan Agreement”), the County HRA made a loan to Borrower in the original principal amount of $400,000.00 (“County HRA Loan”). The County HRA Loan is secured by a Combination Mortgage, Assignment of Rents, Security Agreement, and Fixture Financing Statement dated April 1, 2003 executed by the Borrower in favor of the County, encumbering the Mortgaged Property, recorded on April 24, 2003 with the Hennepin County Registrar of Titles’ Office as Document No. T3724628 (the “County HRA Mortgage”). H. The execution and delivery of this Agreement is a condition of Senior Lender consenting to the City Met Loan, the City HRA TIHAP Loan, the City HRA AHFP Loan, the County Loan and the County HRA Loan. NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are acknowledged, the parties agree as follows: 1. Definitions. The following terms, when used in this Agreement (including, as appropriate, when used in the above recitals), will have the following meanings. (a) The terms used in this Agreement and not otherwise defined in this Agreement, will have the meanings given to those terms in the Senior Loan Agreements. (b) “Bankruptcy Proceeding” means any bankruptcy, reorganization, insolvency, composition, restructuring, dissolution, liquidation, receivership, assignment for the benefit of creditors, or custodianship action or proceeding under any federal or state law with respect to Borrower, any guarantor of any of the Senior Indebtedness, any of their respective properties, or any of their respective partners, members, officers, directors, or shareholders. (c) “Borrower” means all persons or entities identified as “Borrower” in the first Recital of this Agreement, together with their successors and assigns, and any other person or entity who acquires title to the Mortgaged Property after the date of this Agreement; provided that the term “Borrower” will not include Senior Lender if Senior Lender acquires title to the Mortgaged Property. (d) “City HRA AHFP Indebtedness” means all sums evidenced or secured or guaranteed by, or otherwise due and payable to the City HRA pursuant to, the City HRA AHFP Loan Documents. (e) “City HRA AHFP Loan Default” means any act, failure to act, event, condition, or occurrence which allows (but for any contrary provision of this Agreement), or which with the giving of Notice or the passage of time, or both, would allow (but for any contrary provision of this Agreement), the City HRA to take an Enforcement Action; provided, however, that for purposes of this Agreement, no City HRA AHFP Loan Default shall occur solely by reason of a cross-default provision in the City HRA AHFP Loan Documents relating to a Senior Loan Default. (f) “City HRA AHFP Loan Documents” means the City HRA AHFP Loan Agreement, the City HRA AHFP Note, the City HRA AHFP Mortgage, and all other documents at any time evidencing, securing, guaranteeing, or otherwise delivered in connection with the City HRA AHFP Indebtedness, as the same may be amended. (g) “City HRA AHFP Note” means the promissory note or other evidence of the City HRA AHFP Indebtedness referred to in the City HRA AHFP Loan Agreement and any replacement of the City HRA AHFP Note. (h) “City HRA TIHAP Indebtedness” means all sums evidenced or secured or guaranteed by, or otherwise due and payable to the City HRA pursuant to, the City HRA TIHAP Loan Documents. (i) “City HRA TIHAP Loan Default” means any act, failure to act, event, condition, or occurrence which allows (but for any contrary provision of this Agreement), or which with the giving of Notice or the passage of time, or both, would allow (but for any contrary provision of this Agreement), the City HRA to take an Enforcement Action; provided, however, that for purposes of this Agreement, no City HRA TIHAP Loan Default shall occur solely by reason of a cross-default provision in the City HRA TIHAP Loan Documents relating to a Senior Loan Default. (j) “City HRA TIHAP Loan Documents” means the City HRA TIHAP Loan Agreement, the City HRA TIHAP Note, the City HRA TIHAP Mortgage, and all other documents at any time evidencing, securing, guaranteeing, or otherwise delivered in connection with the City HRA TIHAP Indebtedness, as the same may be amended. (k) “City HRA TIHAP Note” means the promissory note or other evidence of the City HRA TIHAP Indebtedness referred to in the City HRA TIHAP Loan Agreement and any replacement of the City HRA TIHAP Note. (l) “City MET Indebtedness” means all sums evidenced or secured or guaranteed by, or otherwise due and payable to the City pursuant to, the City MET Loan Documents. (m) “City MET Loan Default” means any act, failure to act, event, condition, or occurrence which allows (but for any contrary provision of this Agreement), or which with the giving of Notice or the passage of time, or both, would allow (but for any contrary provision of this Agreement), the City to take an Enforcement Action; provided, however, that for purposes of this Agreement, no City MET Loan Default shall occur solely by reason of a cross-default provision in the City MET Loan Documents relating to a Senior Loan Default. (n) “City MET Loan Documents” means the City MET Loan Agreement, the City MET Note, the City MET Mortgage, and all other documents at any time evidencing, securing, guaranteeing, or otherwise delivered in connection with the City MET Indebtedness, as the same may be amended. (o) “City MET Note” means the promissory note or other evidence of the City MET Indebtedness referred to in the City MET Loan Agreement and any replacement of the City MET Note. (p) “County Indebtedness” means all sums evidenced or secured or guaranteed by, or otherwise due and payable to the County pursuant to, the County Loan Documents. (q) “County Loan Default” means any act, failure to act, event, condition, or occurrence which allows (but for any contrary provision of this Agreement), or which with the giving of Notice or the passage of time, or both, would allow (but for any contrary provision of this Agreement), the County to take an Enforcement Action; provided, however, that for purposes of this Agreement, no County Loan Default shall occur solely by reason of a cross-default provision in the County Loan Documents relating to a Senior Loan Default. (r) “County Loan Documents” means the County Loan Agreement, the County Note, the County Mortgage, and all other documents at any time evidencing, securing, guaranteeing, or otherwise delivered in connection with the County Indebtedness, as the same may be amended. (s) “County Note” means the promissory note or other evidence of the County Indebtedness referred to in the County Loan Agreement and any replacement of the County Note. (t) “County HRA Indebtedness” means all sums evidenced or secured or guaranteed by, or otherwise due and payable to the County HRA pursuant to, the County HRA Loan Documents. (u) “County HRA Loan Default” means any act, failure to act, event, condition, or occurrence which allows (but for any contrary provision of this Agreement), or which with the giving of Notice or the passage of time, or both, would allow (but for any contrary provision of this Agreement), the County HRA to take an Enforcement Action; provided, however, that for purposes of this Agreement, no County HRA Loan Default shall occur solely by reason of a cross-default provision in the County HRA Loan Documents relating to a Senior Loan Default. (v) “County HRA Loan Documents” means the County HRA Loan Agreement, the County HRA Note, the County HRA Mortgage, and all other documents at any time evidencing, securing, guaranteeing, or otherwise delivered in connection with the County HRA Indebtedness, as the same may be amended. (w) “County HRA Note” means the promissory note or other evidence of the County HRA Indebtedness referred to in the County HRA Loan Agreement and any replacement of the County HRA Note. (x) “Enforcement Action” means any of the following actions taken by or at the direction of any Subordinate Lender: the acceleration of all or any part of any Subordinate Indebtedness, the advertising of or commencement of any UCC sale, the obtaining of or seeking of the appointment of a receiver, the seeking of default interest, the taking of possession or control of any of the Mortgaged Property, the commencement of any suit or other legal, administrative, or arbitration proceeding based upon any Subordinate Note or any other of the Subordinate Loan Documents, the exercising of any banker’s lien or rights of set-off or recoupment, or the exercise of any other remedial action against Borrower, any other party liable for any Subordinate Indebtedness (including any guarantor of any of the Subordinate Indebtedness) or obligated under any Subordinate Loan Documents. (y) “Enforcement Action Notice” means a written Notice from any Subordinate Lender to Senior Lender, given following any one or more Subordinate Loan Default(s) and the expiration of any Notice or cure periods provided for such Subordinate Loan Default(s) in the applicable Subordinate Loan Documents, setting forth in reasonable detail such Subordinate Loan Default(s) and the Enforcement Actions proposed to be taken by such Subordinate Lender. (z) “Notice” is defined in Section 6(d). (aa) “Senior Indebtedness” means all sums evidenced or secured or guaranteed by, or otherwise due and payable to Senior Lender pursuant to, the Senior Loan Documents. (bb) “Senior Lender” means the person or entity named as such in the first paragraph of this Agreement, and any other person or entity that becomes the legal holder of the Senior Notes after the date of this Agreement. (cc) “Senior Loan Default” means any act, failure to act, event, condition, or occurrence which constitutes, or which with the giving of Notice or the passage of time, or both, would constitute, an “Event of Default” as defined in the Senior Loan Documents. (dd) “Senior Loan Documents” means the “Loan Documents” collectively as defined in the Senior Loan Agreement. (ee) “Subordinate Indebtedness” means collectively the City HRA AHFP Indebtedness, the City HRA TIHAP Indebtedness, the City MET Indebtedness, the County Indebtedness and the County HRA Indebtedness. (ff) “Subordinate Lender” means individually or collectively any of the City, City HRA, County and/or the County HRA and any other person or entity who becomes the legal holder of any of the Subordinate Notes, as applicable, after the date of this Agreement. (gg) “Subordinate Loan Default” means individually or collectively any City HRA AHFP Loan Default, City HRA TIHAP Loan Default, City MET Loan Default, County Loan Default and/or County HRA Loan Default. (hh) “Subordinate Loan Documents” means individually or collectively any City HRA AHFP Loan Documents, City HRA TIHAP Loan Documents, City MET Loan Documents, County Loan Documents and/or County HRA Loan Documents. (ii) “Subordinate Note” means individually or collectively any of the City HRA AHFP Note, City HRA TIHAP Note, City MET Note, County Note and/or County HRA Note. 2. Subordination of Subordinate Indebtedness. (a) The Subordinate Indebtedness is and will at all times continue to be subject and subordinate in right of payment to the prior payment in full of the Senior Indebtedness as provided in this Agreement. (b) Until the occurrence of a Senior Loan Default, each Subordinate Lender will be entitled to retain for its own account all payments made on account of the principal of and interest on such Subordinate Indebtedness in accordance with the requirements of such Subordinate Loan Documents. However, immediately upon each Subordinate Lender’s receipt of Notice or actual knowledge of a Senior Loan Default, each Subordinate Lender will not accept any payments on account of any Subordinate Indebtedness and the provisions of Section 2(c) of this Agreement will apply. Each Subordinate Lender acknowledges that any Subordinate Loan Default constitutes a Senior Loan Default. Accordingly, upon the occurrence of any Subordinate Loan Default, each Subordinate Lender will be deemed to have actual knowledge of a Senior Loan Default. (c) If (i) any Subordinate Lender receives any payment, property, or asset of any kind or in any form on account of any Subordinate Indebtedness (including any proceeds from any Enforcement Action) after a Senior Loan Default of which any Subordinate Lender has actual knowledge (or is deemed to have actual knowledge as provided in 2(b) above) or has been given Notice, or (ii) any Subordinate Lender receives, voluntarily or involuntarily, by operation of law or otherwise, any payment, property, or asset in or in connection with any Bankruptcy Proceeding, such payment, property, or asset will be received and held in trust for Senior Lender. Each Subordinate Lender will promptly remit, in kind and properly endorsed as necessary, all such payments, properties, and assets to Senior Lender. Senior Lender will apply any payment, asset, or property so received from any Subordinate Lender to the Senior Indebtedness in such order, amount (with respect to any asset or property other than immediately available funds), and manner as Senior Lender determines in its sole and absolute discretion. Each Subordinate Lender designates and appoints, irrevocably and coupled with an interest, Senior Lender (and all persons and entities designated by Senior Lender) as each Subordinate Lender’s true and lawful attorney-in-fact with power to endorse the name of such Subordinate Lender, as applicable, upon any check or other instrument and to take any action necessary to collect any payment, property, or asset referred to in, or otherwise effectuate the provisions of, this Section 2(c). (d) Without limiting the subordination of the Subordinate Indebtedness to the payment in full of the Senior Indebtedness as provided herein, in any Bankruptcy Proceeding, upon any payment or distribution (whether in cash, property, securities, or otherwise) to creditors (i) the Senior Indebtedness will first be paid in full in cash before any Subordinate Lender will be entitled to receive any payment or other distribution on account of or in respect of any of the Subordinate Indebtedness, and (ii) until all of the Senior Indebtedness is paid in full in cash, any payment or distribution to which any Subordinate Lender would be entitled but for this Agreement (whether in cash, property, or other assets) will be made to Senior Lender. (e) The subordination of all of the Subordinate Indebtedness as provided herein will continue if any payment under the Senior Loan Documents and/or the Subordinate Loan Documents (whether by or on behalf of Borrower, as proceeds of security or enforcement of any right of set-off or otherwise) is for any reason repaid or returned to Borrower or its insolvent estate, or avoided, set aside or required to be paid to Borrower, a trustee, receiver or other similar party under any bankruptcy, insolvency, receivership or similar law. In such event, any or all of the Senior Indebtedness and/or Subordinate Indebtedness originally intended to be satisfied will be deemed to be reinstated and outstanding to the extent of any repayment, return, or other action, as if such payment on account of such indebtedness had not been made. 3. Subordination of Subordinate Loan Documents. (a) Each of the Subordinate Loan Documents is, and will at all times remain, subject and subordinate in all respects to the liens, terms, covenants, conditions, operations, and effects of each of the Senior Loan Documents as and to the extent provided in this Agreement and the Senior Loan Documents. (b) Each Subordinate Lender acknowledges and agrees that it has no rights or claims under any of the Subordinate Loan Documents in or to any of the proceeds of the Senior Loan or any portion of the Mortgaged Property and Capital Contributions and any purported right or claim thereto is hereby disclaimed and made expressly subject and subordinate in all respects to the rights and claims of Senior Lender under the Senior Loan Documents in or to such Mortgaged Property and Capital Contributions. (c) If any Subordinate Lender, by indemnification, subrogation or otherwise, acquires any lien, estate, right or other interest in any of the Mortgaged Property and Capital Contributions, then such additional lien, estate, right or other interest will be fully subject and subordinate to the receipt by Senior Lender of payment in full of the Senior Indebtedness, and to the Senior Loan Documents, to the same extent as the Subordinate Indebtedness and the Subordinate Loan Documents are subordinate pursuant to this Agreement. 4. Additional Representations and Covenants. (a) Without the prior written consent of Senior Lender in each instance, each Subordinate Lender will not do any of the following: (i) Amend, modify, waive, extend, renew, or replace any provision of any of the Subordinate Loan Documents in any way which would have a material adverse effect on the Borrower or repayment of the Senior Loan. (ii) Pledge, assign, transfer, convey, or sell any interest in the Subordinate Indebtedness or any of the Subordinate Loan Documents unless the transferee expressly acknowledges this Agreement and agrees to be bound by its terms. (iii) Take any action which has the effect of increasing any of the Subordinate Indebtedness or materially alter the repayment terms of any of the Subordinate Indebtedness which would have a negative impact on the ability of the Borrower to repay the Senior Indebtedness. (b) Each Subordinate Lender will deliver to Senior Lender a copy of each Notice of any Subordinate Loan Default delivered by any such Subordinate Lender pursuant to the applicable Subordinate Loan Documents or in connection with the applicable Subordinate Indebtedness, simultaneously with such Subordinate Lender’s delivery of such Notice to Borrower. Senior Lender will deliver to each Subordinate Lender in the manner required in Section 5(b) a copy of each Notice of a Senior Loan Default delivered to Borrower by Senior Lender. Neither giving nor failing to give a Notice to Senior Lender or any Subordinate Lender pursuant to this Section 4(b) will affect the validity of any Notice given by Senior Lender or any Subordinate Lender to Borrower, as between Borrower and Senior Lender or any Subordinate Lender as the Notice is provided to Borrower. (c) Without the prior written consent of Senior Lender in each instance, each Subordinate Lender will not commence, or join with any other creditor in commencing, any Bankruptcy Proceeding. In the event of a Bankruptcy Proceeding, each Subordinate Lender will not vote affirmatively in favor of any plan of reorganization or liquidation unless Senior Lender has also voted affirmatively in favor of such plan. In the event of any Bankruptcy Proceeding, each Subordinate Lender will not contest the continued accrual of interest on the Senior Indebtedness, in accordance with and at the rates specified in the Senior Loan Documents, both for periods before and for periods after the commencement of such Bankruptcy Proceedings. (d) Whenever any of the Subordinate Loan Documents give any Subordinate Lender approval or consent rights with respect to any matter related to the Mortgaged Property (including, without limitation, with respect to the renovation, repair, replacement or operation thereof), and a right of approval or consent with regard to the same or substantially the same matter is also granted to Senior Lender pursuant to the Senior Loan Documents or otherwise, Senior Lender’s approval or consent or failure to approve or consent, as the case may be, will be binding on all Subordinate Lenders. None of the other provisions of this Section 4 are intended to be in any way in limitation of the provisions of this Section 4(d). (e) All requirements pertaining to insurance under all of the Subordinate Loan Documents (including requirements relating to amounts and types of coverages, deductibles and special endorsements) will be deemed satisfied if Borrower complies with the insurance requirements under the Senior Loan Documents of Senior Lender. All original policies of insurance required pursuant to the Senior Loan Documents and all proceeds thereof will be held by Senior Lender. (f) Each Subordinate Lender will not collect payments for the purpose of escrowing for any cost or expense related to the Mortgaged Property. (g) Within ten (10) days after request by Senior Lender, each Subordinate Lender will furnish Senior Lender with a statement, duly acknowledged and certified setting forth the then-current amount and terms of the applicable Subordinate Indebtedness, confirming that there exists no default under the applicable Subordinate Loan Documents (or describing any default that does exist), and certifying to such other information with respect to the applicable Subordinate Indebtedness as Senior Lender may request. (h) Except as provided in Section 5(d), Senior Lender may amend, waive, postpone, extend, renew, replace, reduce or otherwise modify any provision of any of the Senior Loan Documents without the necessity of obtaining the consent of or providing Notice to any Subordinate Lender, and without affecting any of the provisions of this Agreement. 5. Default Under Loan Documents. (a) Senior Lender will have the right, but not the obligation, to cure any Subordinate Loan Default, until such time, if ever, as Senior Lender delivers to each Subordinate Lender Senior Lender’s Notice of written consent to an Enforcement Action described in an Enforcement Action Notice given by any Subordinate Lender as a consequence of any Subordinate Loan Default. Each Subordinate Lender acknowledges that all amounts advanced or expended by Senior Lender to cure any Subordinate Loan Default will be added to and become a part of the Senior Indebtedness and will be secured by the lien of the respective Senior Mortgage(s). (b) Senior Lender will deliver to each Subordinate Lender a copy of any Notice sent by Senior Lender to Borrower of a Senior Loan Default within five (5) Business Days of sending such Notice to Borrower. Failure of Senior Lender to send Notice to any Subordinate Lender will not prevent the exercise of Senior Lender’s rights and remedies under the Senior Loan Documents. Any Subordinate Lender will have the right, but not the obligation, to cure any Senior Loan Default during such period of time, if any, as Borrower is permitted by the terms of the Senior Loan Documents to cure a Senior Loan Default. Any Subordinate Lender will not be subrogated to the rights of Senior Lender under the Senior Loan Documents by reason of any Subordinate Lender having cured any Senior Loan Default. (c) Except as permitted by this subsection (c), any Enforcement Action on the part of any Subordinate Lender will be subject to the prior written consent of Senior Lender. In the event of any Subordinate Loan Default, each Subordinate Lender will not commence any Enforcement Action until after (i) such Subordinate Lender has delivered to Senior Lender an Enforcement Action Notice with respect to such Enforcement Action, and (ii) Senior Lender has delivered to such Subordinate Lender Senior Lender’s written consent to such Enforcement Action by such Subordinate Lender. Senior Lender will advise such Subordinate Lender whether Senior Lender consents to the Enforcement Action by such Subordinate Lender within ninety (90) days following Senior Lender’s receipt of the Enforcement Action Notice (failure of Senior Lender to provide written consent to the Enforcement Action within such 90-day period constitutes Senior Lender’s refusal of such consent). Each Subordinate Lender acknowledges that Senior Lender may grant or refuse consent to any Subordinate Lender’s Enforcement Action in Senior Lender’s sole and absolute discretion. Each Subordinate Lender acknowledges that the provisions of this Section 5(c) are fair and reasonable under the circumstances, that each Subordinate Lender has received a substantial benefit from Senior Lender having granted its consent to each Subordinate Loan, and that Senior Lender would not have granted such consent without the inclusion of these provisions in this Agreement. 6. Miscellaneous Provisions. (a) If there is any conflict or inconsistency between the terms of any of the Subordinate Loan Documents and the terms of this Agreement, then the terms of this Agreement will control. (b) This Agreement will be binding upon and will inure to the benefit of the respective legal successors and permitted assigns of the parties hereto. No other party will be entitled to any benefits hereunder, whether as a third-party beneficiary or otherwise. (c) This Agreement does not constitute an approval by Senior Lender of the terms of any of the Subordinate Loan Documents. (d) Each Notice, request, demand, consent, approval or other communication (collectively, “Notices,” and singly, a “Notice”) which is required or permitted to be given pursuant to this Agreement will be in writing and will be deemed to have been duly and sufficiently given if (i) personally delivered with proof of delivery (any Notice so delivered will be deemed to have been received at the time so delivered), or (ii) sent by a national overnight courier service (such as FedEx) designating earliest available delivery (any Notice so delivered will be deemed to have been received on the next Business Day following receipt by the courier), or (iii) sent by United States registered or certified mail, return receipt requested, postage prepaid, at a post office regularly maintained by the United States Postal Service (any Notice so sent will be deemed to have been received on the date of delivery as confirmed by the return receipt), addressed to the respective parties as follows: (i) Notices intended for Senior Lender will be addressed to: Bridgewater Bank 7831 East Bush Lake Road, Suite 300 Bloomington, Minnesota 55439 Attn: Ross Wieser With a copy to: Messerli & Kramer, P.A. 1400 Fifth Street Towers 100 South Fifth Street Minneapolis, Minnesota 55402 Attn: Michelle R. Jester, Esq. (ii) Notices intended for Subordinate Lenders will be addressed to: City: City of Plymouth 3400 Plymouth Boulevard Plymouth, MN 55447 Attn: Community Development Director City HRA: Housing and Redevelopment Authority in and for the City of Plymouth 3400 Plymouth Boulevard Plymouth, MN 55447 Attn: Community Development Director County: County of Hennepin 701 Fourth Avenue South, Suite 400 Minneapolis, MN 55415 Attn: Director County HRA: Hennepin County Housing and Redevelopment Authority 701 Fourth Avenue South, Suite 400 Minneapolis, MN 55415-1843 Attn: Deputy Executive Director Any party, by Notice given pursuant to this Section, may change the person or persons and/or address or addresses, or designate an additional person or persons or an additional address or addresses, for its Notices, but Notice of a change of address will only be effective ten (10) days after receipt. Neither party will refuse or reject delivery of any Notice given in accordance with this Section. (e) Nothing in this Agreement or in any of the Senior Loan Documents or any Subordinate Loan Documents will be deemed to constitute Senior Lender as a joint venturer or partner of any Subordinate Lender. (f) Upon Notice from Senior Lender or any Subordinate Lender to the other, all will execute and deliver such additional instruments and documents, and will take such actions, as are required by the notifying party in order to further evidence or implement the provisions and intent of this Agreement. (g) This Agreement will be governed by the laws of the State in which the Mortgaged Property is located. (h) If any one or more of the provisions contained in this Agreement, or any application of any such provisions, is invalid, illegal, or unenforceable in any respect, the validity, legality, enforceability, and application of the remaining provisions contained in this Agreement will not in any way be affected or impaired. (i) The term of this Agreement will commence on the date of this Agreement and will continue until the earliest to occur of the following events: (i) the payment of all of the Senior Indebtedness; provided that this Agreement will be reinstated in the event any payment on account of the Senior Indebtedness is avoided, set aside, rescinded or repaid by Senior Lender as described in Section 2(e) of this Agreement, or (ii) the payment of all of the Subordinate Indebtedness other than by reason of payments which any Subordinate Lender is obligated to remit to Senior Lender pursuant to this Agreement, and the termination of all Subordinate Lenders’ obligations to advance proceeds of any Subordinate Loan; provided that this Agreement will be reinstated in the event any payment on account of any of the Subordinate Indebtedness is avoided, set aside, rescinded or repaid by any Subordinate Lender as described in Section 2(e) of this Agreement. (j) No failure or delay on the part of any party to this Agreement in exercising any right, power, or remedy under this Agreement will operate as a waiver of such right, power, or remedy, nor will any single or partial exercise of any such right, power or remedy preclude any other or further exercise of such right, power, or remedy or the exercise of any other right, power or remedy under this Agreement. (k) Each party to this Agreement acknowledges that if any party fails to comply with its obligations under this Agreement, the other parties will have all rights available at law and in equity, including the right to obtain specific performance of the obligations of such defaulting party and injunctive relief. (l) This Agreement shall inure to the benefit of any subsequent holder of the Senior Indebtedness. (m) This Agreement may be amended, changed, modified, altered or terminated only by a written instrument or written instruments signed by the parties to this Agreement. (n) This Agreement may be executed in two or more counterparts, each of which will be deemed an original but all of which together will constitute one and the same instrument. \[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS\] IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the day and year first above written. SENIOR LENDER: BRIDGEWATER BANK, a Minnesota banking corporation By: ________________________________ Ross Wieser Its: Vice President STATE OF MINNESOTA) ) ss. COUNTY OF HENNEPIN) The foregoing instrument was acknowledged before me this ___ day of _________, 2020, by Ross Wieser, the Vice President of Bridgewater Bank, a Minnesota banking corporation on behalf of the banking corporation. __________________________________________ Notary Public Master Subordination Agreement Page S-1 SUBORDINATE LENDER: CITY OF PLYMOUTH By: ________________________________ Printed Name: _______________________ Its: ________________________________ STATE OF MINNESOTA) ) ss. COUNTY OF HENNEPIN) The foregoing instrument was acknowledged before me this ___ day of _________, 2020, by_____________________, the _________________ of the City of Plymouth, a public body corporate and politic on behalf of the City. __________________________________________ Notary Public Master Subordination Agreement Page S-2 SUBORDINATE LENDER: HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF PLYMOUTH By: ________________________________ Printed Name: _______________________ Its: ________________________________ STATE OF MINNESOTA) ) ss. COUNTY OF HENNEPIN) The foregoing instrument was acknowledged before me this ___ day of _________, 2020, by_____________________, the _________________ of the Housing and Redevelopment Authority in and for the City of Plymouth, a public body corporate and politic on behalf of the Housing and Redevelopment Authority for the City of Plymouth. __________________________________________ Notary Public Master Subordination Agreement Page S-3 SUBORDINATE LENDER: APPROVED AS TO FORM COUNTY OF HENNEPIN, STATE OF MINNESOTA ON BEHALF OF THE HENNEPIN HOUSING CONSORTIUM _____________________________ Assistant County Attorney Date: ________________________ By: __________________________________ Chair of its County Board Attest: ________________________________ Deputy/Clerk of the County Board Date: _________________________________ By: __________________________________ County Administrator Date: _________________________________ STATE OF MINNESOTA) ) ss. COUNTY OF HENNEPIN) The foregoing instrument was acknowledged before me this ___ day of _________, 2020, by_________________________________, the Chair of the County Board, and _______________________________, the Deputy/Clerk of the County Board, and ___________________________ the County Administrator of the County of Hennepin, State of Minnesota on behalf of the Hennepin Housing Consortium. __________________________________________ Notary Public RECOMMENDED FOR APPROVAL: __________________________________________ Chief Housing and Economic Development Officer Date: ____________________________________ Master Subordination Agreement Page S-4 SUBORDINATE LENDER: HENNEPIN COUNTY HOUSING AND REDEVELOPMENT AUTHORITY a Minnesota public body corporate and politic APPROVED AS TO FORM _____________________________ By: Assistant County Attorney Chair of its Board Date: ________________________ Attest: Deputy/Clerk of the County Board By: ______________________________________ Executive Director STATE OF MINNESOTA ) ) ss. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this ___ day of ____________, 2020, by _________________________________, the Chair of the Board and ____________________ the Executive Director of the Hennepin County Housing and Redevelopment Authority, a public body corporate and politic, on behalf of the Authority. Notary Public RECOMMENDED FOR APPROVAL: Chief Housing and Economic Development Officer Date: Master Subordination Agreement Page S-5 CONSENT OF BORROWER Borrower acknowledges receipt of a copy of this Subordination Agreement, dated May ____, 2020, by and among Bridgewater Bank, the City of Plymouth Minnesota, the Housing and Redevelopment Authority for the City of Plymouth, the County of Hennepin, and Hennepin County Housing and Redevelopment Authority, State of Minnesota and consents to the terms and conditions of the parties set forth in this Agreement. PLYMOUTH LEASED HOUSING ASSOCIATES, LIMITED PARTNERSHIP, a Minnesota limited partnership By: Plymouth Leased Housing Associates, LLC, a Minnesota limited liability company Its: General Partner By: ____________________________ Paul R. Sween Its: Vice President STATE OF MINNESOTA) ) ss. COUNTY OF HENNEPIN) The foregoing instrument was acknowledged before me this ___ day of _________, 2020, by Paul R. Sween, the Vice President of Plymouth Leased Housing Associates, LLC, a Minnesota limited liability company, as General Partners of Plymouth Leased Housing Associates, Limited Partnership, a Minnesota limited partnership on behalf of the limited partnership. __________________________________________ Notary Public Master Subordination Agreement Page S-6 EXHIBIT A LEGAL DESCRIPTION Lot 1, Block 1, Stone Creek Village, Hennepin County, Minnesota. Hennepin County, Minnesota Torrens Property