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In order to provide the source of repayment of the loan to be made
<br />pursuant to the Financing Agreement, the Developer will deliver to the Trustee
<br />a Mortgage Note in the principal amount of approximately $3,600,000.00 (the
<br />"Note "), and a Mortgage securing the Note constituting a first lien on the
<br />Project (the "Mortgage ") and as further security for such loan, the Developer
<br />will execute and deliver to the Trustee, an assignment of all the Developer's
<br />right, title and interest in and to the Lease (the "Assignment of Lease "), and
<br />a Security Agreement granting a first lien on all fixtures and equipment in the
<br />Project (the "Security Agreement "); and
<br />The Developer expects that, in accordance with the terms of a commit-
<br />ment to be issued to the Servicer, and a Regulatory Agreement with the Developer
<br />(the "Regulatory Agreement "), the United States Secretary of Housing and Urban
<br />Development, acting through the Federal Housing Commissioner ("FHA ") will agree
<br />to insure the advances of funds secured by the Mortgage, and that the Note will
<br />be endorsed for insurance by FHA pursuant to Section 232 of the National Housing
<br />Act, as amended, and the regulations thereunder; and
<br />Pursuant to a Servicing Agreement between the Servicer and the Trustee
<br />(the "Servicing Agreement "), the payments required to be made by the Developer
<br />pursuant to the Note, Mortgage and Regulatory Agreement are to be collected by
<br />the Servicer and the Servicer will forward to the Trustee the payments of princi-
<br />pal and interest on the Note, such payments to be applied to pay the principal
<br />of and interest on the Bonds; and
<br />Following a duly held public hearing, the South Bend Economic Develop-
<br />ment Commission has adopted a resolution finding that the proposed financing of
<br />the Project complies with the purposes and provisions of the Act, and approving
<br />the documents referred to above, and the St. Joseph County Council has adopted
<br />a resolution consenting to the issuance of the Bonds and the content of the
<br />Bonds and related documents;
<br />NOW, THEREFORE, BE IT ORDAINED by the Common Council of the City of
<br />South Bend, Indiana, as follows:
<br />Section 1. Findings; Public Benefits. The Common Council of the City
<br />hereby finds and determines that the Project to be acquired and constructed with
<br />the proceeds of the Bonds herein authorized are "economic development facilities"
<br />as that phrase is used in the Act; that acquisition and contruction of the Project
<br />by the Developer, and the operation of the Project by the User will increase
<br />employment opportunities and increase diversification of economic development
<br />facilities in and near the City, will improve and promote the health, economic
<br />stability, development and welfare in and near the City, will promote the ex-
<br />pansion of industry, trade and commerce in the area in and near the City; and
<br />that the public benefits to be accomplished by this Bond Ordinance, intending
<br />to overcome insufficient employment opportunities, are greater than the cost of
<br />public services (as that phrase is defined in the Act) which will be required by
<br />the Project; and will not have an adverse competitive effect on similar faci-
<br />lities already constructed or operating in the City and County.
<br />Section 2. In order to pay a portion of the costs of acquiring and
<br />constructing the Project, there are hereby authorized to be issued, sold and
<br />delivered the Bonds in an aggregate principal amount not exceeding $4,000,000.00.
<br />The Bonds will be sold at a price not less than the par amount thereof, plus
<br />accrued interest, to such purchasers as may be satisfactory to the City, as
<br />recommended by Blyth, Eastman, Paine Webber Health Care Funding, Inc. and Herbert
<br />J. Sims & Co., Inc., as placement agents for the City (the "Placement Agents ").
<br />The Bonds shall bear interest at a rate not in excess of twelve percent (12 %)
<br />per annum, and shall have a maturity date not later than 30 years from the date
<br />thereof. Any costs of the Project which cannot be paid from the proceeds of the
<br />Bonds will be paid for by the Developer, unless paid for from the proceeds of
<br />additional parity bonds, as authorized by the Indenture.
<br />Section 3. Approval of Indenture and Financing Agreement. The forms
<br />of Indenture and Financing Agreement presented to this meeting are hereby approved,
<br />and the Mayor is hereby authorized and directed to execute and deliver, and the
<br />clerk is hereby authorized to affix and attest the corporate seal of the City to
<br />an Indenture and Financing Agreement in substantially such form with such changes
<br />therein as counsel may advise and the officers executing the same may approve,
<br />such approval to be evidenced by their execution thereof.
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