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June 11, 2013
<br />Kurt Ulrich
<br />City of Ramsey HRA
<br />7550 Sunwood Dr NW
<br />Ramsey MN 55303
<br />Via Email: kulrich @ci.ramsey.mn.us
<br />Re: Proposal for Loan Agreement Restructuring,
<br />The Residence at The COR, Ramsey MN
<br />Dear Kurt,
<br />This letter is designed to serve as a proposal for restructuring of the initial Loan Agreement per the Development
<br />Agreement that was entered into by F & C Ramsey, LLC ( "Developer "), F & C Ramsey Member, LLC ( "Borrower "),
<br />The Housing and Redevelopment Authority in and for the City of Ramsey, Minnesota (the "HRA "), and the City of
<br />Ramsey, Minnesota (the "City "). The proposed restructuring of the Loan Agreement is specifically in regards to the
<br />prepayment plan on Loan No. 2 in the Loan Agreement and the forgiveness credit on principal amount of Loan No.
<br />1 outlined in the initial Loan Agreement.
<br />The initial Loan Agreement for Loan No. 2 states, in Section 8,1 of Article VIII of the Development Agreement, that
<br />to further assist Developer with the construction of the Housing Development Project, the HRA proposes to make
<br />a loan to Borrower in an original principal amount equal to the sum of (1) $6,825,000.00 (ii) the Costs of Issuance
<br />pursuant to the terms of the Loan Agreement and the Note No. 2. In Section 8,5 of Article VIII it goes on to outline
<br />the options of prepayment that are available to the Borrower. It states the Borrower may prepay Note No. 2, in
<br />whole or in part, at any time and, if In part, from time to time, during the term of Note No. 2. Specifically it states If
<br />Borrower prepays $2,000,000.00 or more on or before the date 12 months after the date of the first disbursement
<br />of proceeds of Loan No, 2 (July 16, 2013), the HRA shall forgive $250,000,00 of the principal amount of Loan No. 1,
<br />such forgiveness to be effective as of the date Borrower has prepaid at least $2,000,000.00.
<br />Our proposed restructuring of the Loan Agreement for Loan No. 2, would result In a reduction in prepay amount
<br />that Borrower is required to meet in order to receive forgiveness on the principal amount of Loan No, 1, In
<br />conjunction with the reduction in prepay amount that Borrower is required to meet, our proposal also would
<br />reduce the received forgiveness amount on the principal amount of Loan No, 1. We would like to restructure the
<br />Loan Agreement to state that if Borrower prepays $1,000,000,00 or more on or before the date 12 months after
<br />the date of the first disbursement of proceeds of Loan No, 2 (July 16, 2013), the HRA shall forgive $125,000,00 of
<br />the principal amount of Loan No. 1, such forgiveness to be effective as of the date Borrower has prepaid at least
<br />$1,000,000.00.
<br />The proposed restructuring of the Loan Agreement for Loan No. 2 would effectively reduce the amount of
<br />prepayment required for forgiveness on the principal amount of Loan No. 1 from $2,000,000,00 to $1,000,000,00
<br />as well as reduce the amount of forgiveness on the principal amount of Loan No. 1 from $250,000.00 to
<br />$125,000.00, Essentially our proposal would result in a 50% decrease in both the prepayment amount require for
<br />forgiveness on the principal amount of Loan No. 1 as well as the amount of forgiveness on the principal amount of
<br />Loan No, 1.
<br />Consideration to approve said proposal is very much appreciated.
<br />Very truly yours,
<br />Ryan 0, ronk
<br />Flaherty & Collins
<br />
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