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• "Owner" shall mean the Pines of Hutchinson, LLC, a Minnesota limited liability company of which Maplewood is the sole member, and its affiliates and assigns. "Program" shall mean this program for the financing of the Project pursuant to the Act. "Project" shall mean the multifamily senior residential rental housing development consisting of fifty (50) total Housing Units, of which ten (1) are standard one-bedroom units, two (2) are handicapped accessible one-bedroom units, eight (8) are no patio/balcony one-bedroom units, eight (8) are balcony one-bedroom units, eight (8) are patio one-bedroom units, four (4) are den one-bedroom units, four (4) are no patio/balcony two- bedroom units, two (2) are patio two-bedroom units, two (2) are balcony two-bedroom units, and two (2) are standard two-bedroom units, to be designed, constructed and equipped by the Owner, together with functionally related facilities. Section B. Program For Financing the Project. It is proposed that the Issuer establish this Program to provide financing for the design, construction and equipping of the Project at a cost and upon such other terms and conditions as are set forth herein and as may be agreed upon in writing between The Issuer and the Owner. The Issuer expects to issue the Bonds as soon as the terms of the Bonds have been agreed upon by The Issuer, the Owner, and the initial purchaser(s) of the Bonds. The proceeds of the Bonds will be loaned by The Issuer to the Owner to finance the design, construction, and equipping of the Project, and such proceeds are also to be applied to any of the following purposes: (i) fund debt service reserve funds or other reserves for the Bonds; (ii) fund interest on the Bonds during construction of the Project; and (iii) pay a portion of the costs of issuance with respect to the Bonds. It is anticipated that the Bonds will be sold simultaneously in two separate series as follows: (1) Series 2005A - $5,300,000 Tax-Exempt; and (2) Series 2005B - $ 200,000 Taxable. The Bonds will be sold on a negotiated sale basis to the retail and institutional marketplace. The Series A Bonds shall have a 30 year stated final maturity and shall amortize over a 27 year period. The Series B Bonds shall have a 3 year final maturity, • amortize over a 2 year period, and shall have a fixed rate of interest for the term. While the final interest rate on the Bonds is subject to market conditions at the time of Bonds pricing, it is estimated that the interest rate on the Bonds in today's market would be as follows: Average,. Coupon Series A 5.89% -Fixed for 30 years Series B 6.00% -Fixed for 3 years The Issuer will not hire additional staff for the administration of the Program. No administrative costs will be paid from The Issuer's budget with respect to this Program. The Bonds will be special, limited revenue obligations of The Issuer and the Bonds and interest thereon will be payable solely from the revenues and assets pledged to the payment thereof. No Holder of any Bonds will ever have the right to compel any exercise of the taxing power of The Issuer to pay the Bonds or the interest thereon, nor to enforce payment against any property of The Issuer (except revenues of the Borrower) to be paid to The Issuer and pledged to the payment of the Bonds. Section C. Standards and Reuirements Relating to the Financing of the Project Pursuant to the Pro~~ram. The following standards and requirements shall apply with respect to the operation of the Project by the Owner pursuant to this Program: (1) Substantially all of .the proceeds of the sale of the Bonds will be applied to (i) the design, construction, and equipping of the Project, (ii) the payment of the costs of issuing the Bonds, (iii) the payment of interest on the Bonds during construction of the Project, and (iv) the funding of appropriate reserves. The proceeds will be made available to the Owner pursuant to the terms of a Loan • Agreement or other revenue agreement, which will include certain covenants to be made by the Owner to The Issuer regarding the use of proceeds and the character and use of the Project.