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Ms. Lysandra Shaw
April 14, 2026
Page 2
Tradition’s management engaged NNRHA proactively regarding both the
impending balloon and delinquency, signaling a willingness to work
collaboratively. Per the current CFO, Tradition employs approximately 15
people and has contributed over $1,032,000 in cumulative taxes since
inception, fulfilling NNUDAG objectives. Budgets for 2026 and 2027 project
continued profitability, supporting repayment feasibility.
Tradition proposed the following plan in a request dated January 12, 2026 :
e Make three consecutive double payments of $5,288.48 in March, April,
and May 2026 to cure delinquency, with suspension of late fees during
this period.
e Beginning June 2026, resume regular monthly payments of $2,644.24
at the existing 3% interest rate until the loan is fully amortized, avoiding
a balloon at maturity.
e The borrower has also requested that personal guarantees for
individuals who have exited ownership be eliminated during the
extension period.
Regarding Tradition’s request for removal of some guarantors, staff does not
support this request. Ownership changes were made without prior notice or
consent, which constitutes a breach of the loan agreement. Given this breach
and the governance risk it creates, along with prior challenged regular
payments, staff recommends strengthening, not reducing, guarantor
coverage. Specifically, all owners with 10% or greater equity should be added
as personal guarantors, and no releases should be granted during the
extension period. These measures are necessary to protect the Authority's
position and mitigate risk.
Staff is recommending approval of the proposed extension, suspension of late
fees that were incurred during the catch-up period, a required guarantor
realignment to include all original guarantors and any new owners with 10%
or more, with the possible exception of the LLC now involved, and maintain
original collateral and covenants. In order to memorialize this approval, if
granted, we would ask that the NNRHA attorney prepare a modification
agreement that would reflect the terming out of the loan balance at the endJump to an indexed page (195 of 195)