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Owners-Managers RESIDENTIAL APARTMENTS •HEALTH CARE FACILITIES • RETIREMENT CENTERS •COMMERCIAL PROPERTIES SAGE SAGE COMPANY February 9, 1996 1712 HOPKINS CROSSROAD • MINNETONKA,MN 55305 PHONE(612)591-1200 • FAX(612)591-9848 Mr. Michael Morrison City Manager St. Anthony Village 3301 Silver Lake Road St. Anthony, MN 55418-699 RE: City of St. Anthony Multi-Family Housing Revenue Bonds - $5,960,000 (St. Anthony Nursing Home Project/Chandler Place) Dear Michael: As indicated in our January 26th letter, we intend to refund the above referenced Bond Issue and extend the term of the Bonds to December 1,2025. The purpose of this letter is to set forth the terms we have discussed with the City regarding the conditions under which the City will agree to cooperate with such a refunding transaction. We understand that the City staff will recommend that the City agree to the following terms and conditions. As you know,the City and St. Anthony Nursing Home Limited Partnership ("Partnership").are the parties to a Development Agreement dated December 1, 1995 ("Agreement"). One aspect of the Agreement deals with a $700,000 loan from the City's Housing and Redevelopment Authority to the Partnership (the "TIF Loan"). The terms we have discussed (which we would like the City to formally approve) are as follows: 1. The City will adopt appropriate resolutions to facilitate the refunding at the earliest possible time and fully cooperate throughout that process; 2. The Partnership will, at the closing of that refunding, pay the Obligee on the TIF Loan $500,000 plus either a Letter of Credit in the amount of$100,000 ("Letter of Credit")or an additional cash deposit of$100,000 ("Cash Deposit") in exchange for a full satisfaction of the TIF Loan together with accrued interest thereon. We further understand that all documentation relating to the TIF loan will be satisfied at closing. S:IHCAREICORRESPOV E7TERS1199617401MORNSON.WPD