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Resolution Approving and Authorizing Execution of a Loan Payoff In Full in the Amount of $25,000, by Hmong American Partnership of the Loan to D & N, Inc., dba Mai Village Restaurant Located at 394 University Avenue, and to Charge Off the HRA Loan and Add Borrowers to the Adverse Lending List
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WHEREAS, the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (the "HRA") is a public body corporate and politic established pursuant to the provisions of Minnesota Statutes, Section 469.001, et seq. (the "Act"); and
WHEREAS, the HRA has the power to engage in development or redevelopment activities under Minnesota law and the HRA is authorized to engage in activities relating to (a) housing projects and development, (b) removal and prevention of the spread of conditions of blight or deterioration, (c) bringing substandard buildings and improvements into compliance with public standards, (d) disposition of land for private redevelopment, and (e) improving the tax base and the financial stability of the community, and to engage in the aforementioned activities when these needs cannot be met through reliance solely upon private initiative and which can also be undertaken in targeted neighborhoods; and is authorized to create redevelopment projects as defined in Minn Stat Section 469.002, Subd. 14; and
WHEREAS, in April 2003 the HRA, the SBA and Western Bank provided financing to D & N, Inc., dba Mai Village Restaurant, My Dung T. Nguyen and Ngoan Van Dang ("Borrower") to acquire and construct the Mai Village Restaurant at 394 University Avenue (the "Project"); and
WHEREAS, the HRA's loan was in the amount of $400,000 ("Loan") and was evidenced by a promissory note, mortgage, assignment of rents and leases, fixture financing statement, security agreement and loan agreement executed by Borrower ("Loan Documents"); and
WHEREAS, the HRA Loan was subordinate to the first mortgage loan made by Western Bank and the SBA loan; and
WHEREAS, in 2008 the HRA approved a seven month deferral of Loan repayments from May to December, 2008 and a First Amendment to Loan Documents; and Loan payments were made by Borrower to the HRA from January 2009 through March 2010; and
WHEREAS, on March 24, 2010 the HRA approved a Second Amendment to Loan Documents which deferred, but did not forgive, repayment for the period from April 2010 through March 2011; and
WHEREAS, on December 14, 2011 the HRA approved a Third Amendment to Loan Documents which deferred, but did not forgive, repayment for the period from April 2011 through June 2015, and
WHEREAS, Western Bank, the first mortgage lender has initiated foreclosure of its mortgage and it is not financially feasible for the HRA to redeem the property from that first mortgage foreclosure; and
WHEREAS, the Hmong American Partnership has offered the HRA $25,000 as payment in full for the HRA Loan in consideration for full release of HRA Loan Documents; and
WHEREAS, HRA wishes to charge off the Loan to Borrower and add Borrower to the Adverse Lending List; and
WHEREAS, no budget amendment is needed for the HRA's actions in this Resolution.
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota, that:
1. The HRA Board hereby approves the acceptance of a $25,000 payment from Hmong American Partnership as payment in full for the HRA Loan and HRA agrees to release Borrower and all Loan Documents and collateral securing the HRA Loan and charging off the HRA Loan and adding the Borrower to the HRA Adverse Lending List. The HRA Executive Director is hereby authorized and directed to negotiate and execute the necessary documents on behalf of the HRA.
2. The HRA Executive Director, staff and legal counsel for the HRA are further directed and authorized to take all actions necessary to implement this Resolution, and the HRA's Executive Director is authorized to execute any documents and instruments in connection therewith.