6.3. EDSR 03-20-2017 - Laserfiche WebLink

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ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF ELK RIVER COUNTY OF SHERBURNE STATE OF MINNESOTA RESOLUTION NO. RESOLUTION APPROVING SUBORDINATION OF SECURITY INTEREST Section 1. Recitals 1.01 On May 5, 2016, the Economic Development Authority of the City of Elk River (the "EDA") provided a microloan (the "Loan") in the amount of $200,000 to Patriot Converting, Inc., a Minnesota corporation (referred to as "Debtor") pursuant to a Loan Agreement, dated as of May 5, 2016 (the "Loan Agreement") between the EDA and the Debtor. The Loan was secured by a personal guaranty of Michael Stillwell, Executive Vice President of the Borrower and by a security interest in certain equipment of the Debtor as evidenced by a Security Agreement, dated as of May 5, 2016 (the "Security Agreement") from the Debtor to the EDA. 1.02 On October 17, 2016, the Board of Commissioners (the `Board") of the EDA approved the First Amendment to the Loan Agreement and the First Amendment to the Security Agreement allowing the Debtor to amend the equipment provided as security for the Loan. 1.03. The Debtor has obtained additional financing for additional equipment at its facility in the City of Elk River from the Central Minnesota Development Company on behalf of the United States Small Business Administration (the "SBA"). As a requirement of the additional financing, the SBA has required that the Debtor obtain the EDA's consent to subordinate its security interest in equipment owned by the Debtor to the SBA and thereby have a 3`d lien (rather than 2nd lien) position in such equipment. 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 subordination A eement. 2.01. The subordination of the EDA's security interest in the Debtor's equipment to the SBA (the "Subordination") is hereby in all respects approved together with any related documents necessary in connection therewith, and the President and Executive Director are hereby authorized and directed to execute any documents necessary to effect the Subordination on behalf of the EDA and to cavy out, on behalf of the EDA, the FDA's obligations thereunder. 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. 496287v11SB ELI 85-39