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449010v2 JAE MN475-38 2 outstanding Variable Rate Demand Multifamily Housing Revenue Bonds (St. Hedwig’s Assisted Living Project), Series 2002 (the “2002 Assisted Living Bonds”), issued by the City of Minneapolis on December 23, 2002, in the original aggregate principal amount of $7,570,000; (iv) refund the outstanding Variable Rate Demand Nursing Home Revenue Refunding Bonds (Catholic Eldercare Project), Series 2002 (the “2002 Nursing Home Bonds”), issued by the City of Minneapolis on December 23, 2002, in the original aggregate principal amount of $9,580,000; (v) refinance certain taxable indebtedness of the Borrower (the “Prior Loans”); (vi) fund required reserves for the Notes, if any; and (vii) pay the costs of issuing the Notes (collectively, the “Project”). 1.04. The City of Minneapolis loaned the proceeds of the 2002 Assisted Living Bonds to Catholic Eldercare Community Services Corporation II, a Minnesota nonprofit corporation and an affiliate of the Borrower to finance the acquisition, construction, and equipping of a 71-unit assisted living facility located at 2919 Randolph Street NE (commonly known as RiverVillage East) in the City of Minneapolis (the “Assisted Living Facility”). The 2002 Assisted Living Bonds were issued in accordance with the Industrial Development Act. The City of Minneapolis loaned the proceeds of the 2002 Nursing Home Bonds to the Borrower, to (i) refinance the acquisition, construction, and equipping of the 150-bed skilled nursing facility located at 900 2nd Street NE (commonly known as Catholic Eldercare on Main) in the City of Minneapolis (the “Skilled Nursing Facility”); and (ii) refinance the acquisition, construction, and equipping of a 51-unit assisted living multifamily rental housing facility located at 909 Main Street NE (commonly known as MainStreet Lodge) in the City of Minneapolis (the “Assisted Living Housing Facility”). The 2002 Nursing Home Bonds were issued in accordance with the Industrial Development Act and the Housing Act, and the City of Minneapolis adopted programs for the facilities financed in accordance with the Housing Act. 1.05. The facilities financed and refinanced with the proceeds of the Notes are referred to herein as the “Facilities” and will be owned and operated by the Borrower and individual affiliates of the Borrower. 1.06. The City, the City of Lauderdale, and the City of Minneapolis are proposing to enter into a Cooperative Agreement, to be dated on or after December 1, 2014 (the “Cooperative Agreement”), pursuant to which the City of Minneapolis will consent to the issuance by the City and the City of Lauderdale of the Mounds View Note and the Lauderdale Note and the financing of the Project by the City and the City of Lauderdale. 1.07. The Borrower has represented to the City that it is exempt from federal income taxation under Section 501(a) of the Internal Revenue Code of 1986, as amended (the “Code”), as a result of the application of Section 501(c)(3) of the Code. 1.08. On September 8, 2014, the City Council conducted a duly noticed public hearing at which a reasonable opportunity was provided for interested individuals to express their views, both orally and in writing, on the approval of the Project and the issuance of the Mounds View Note pursuant to the requirements of Section 147(f) of the Code and the regulations promulgated thereunder. 1.09. The Mounds View Note is to be issued under the terms of this resolution. Northeast Bank, a Minnesota banking and insurance corporation (the “Lender”), has agreed to purchase the Mounds View Note. The proceeds derived from the sale of the Mounds View Note to the Lender (the “Loan”) are to be loaned by the City to the Borrower pursuant to the terms of a Loan Agreement, to be dated on or after December 1, 2014 (the “Loan Agreement”), between the City and the Borrower. Proceeds of the Mounds View Note will be applied by the Borrower to (i) refund a portion of the outstanding principal amount of the 2002 Assisted Living Bonds and the 2002 Nursing Home Bonds; (ii) refinance a portion of