7A Request from Presbyterian Homes for Conduit Financing

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(7) This Loan Agreement and the Note are issued by the City pursuaxzt to the City's governrnental pxogram of acquiring purpase investments for qualified 501(c){3) projects. The governmental program involves ihe origination or acquisition of purpose investments and (a) at least 95 percent af the cost of the purpase invest�ments acquired �nder the program represents one or more loans to 501(c)(3) arganizations, (b) at least 95 percent of the receipis from the purpose inves�znents are used to pay principal, inierest or redemption prices on issues ihat financed the program, to pay or reixnburse administrative costs af those issues or of the program, to pay or reimburse anticipated future losses directly related to the program, to �inance additional puzpose investments %r �he same general purposes of the program, or to redeem and retire governmental obligations at the nexi earliest possible date of redemption, (c) ihe program documents prohibit any obligar on a purpose invest�ieni financed by the program or any related party to that obligoz from purchasing bands of an issue that finance the program i� an amount related to the amount of the purpose investment acquired from thati obligor, and (d) th� City has not waived the right to treat the investment as a program invesi�nent. Section 2,2 Re�resentations by the Borrower. The Borrower rnakes the following representations as the basis for its covenants herein: {J.) The Borrow�r is a Mi�esota nonprofit corporatiox� duly incorparaied and in gaod standing under the laws of the State of Minnesota, is duly authorized to conduct its business in all staies where its activities require such authorization, has power to enter into this Agreement, the Disbursing Agree�zent, and ihe Mortgage and to use the Project for the purpose set forth in this Agreement and by proper corporate action has authorized the execution and deiivery of this A�re�ment and the Mortgage; (2) The Borrower is an organization described in Seciion 501(c}(3) of the Code and is exempt from t� under Section 501(a) of the Code. The Borrower is not a"private �oundation" as defined in Section 549(a) of the Code. Nat more than five percent (5%} of the proceec�s of the Note will be used, directly or indirectly, to fmance or refinance property used in an unrelated trade or business of th� Borrawer deterrnined by applying Section 513(a) oi the Code or in the t�rade or business of any person oiher than an organization described in Section 501(c}(3) of the Code. There is no action, proceeding ar investigation pending or threatened by the Internal Revenue Service or authoz�ties of the State of Minn.esota which, if adversely determined, might resu�t in a modif cation of the status oi the Borrower as an organization desc�bed in Section 501(c}(3) of the Code; (3) The issuance and sale of the Note by the City and loan of the praceeds of the Noteto ihe Borrower, has induced the Borrower to complete the Projeci within the Host Ciiy. {4) The e�ecution and delivery of this Agreement and the Mortgage, the consumrz�ation of the transactions contemplaied ihereby, and the fulfillment o#' the te�ns and conditioz�s thereof do noi and will not conflict with or result in a breach of any of the terms or condition.s of ihe Barrower's articles af incorporation, its bylaws, any r�striction or any agreement or inst�unent to r�hich the Borrower is novc� a party or by which it is baund or to which any property of the Boxxower is subject, and do nat and will not constitute a default ur�der a,xa.y of the faregoing or a violation of any order, decree, statute, rule or regulation of any court ar of any state ar federal regulatory body having jurisdiction over the Bo�ower or its properties, zzossasva 6