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and the Borrower; the Issuer is not subject to any liability thereon; no owner of the Bonds
<br />shall ever have the right to compel the exercise of the taxing power of the Issuer to pay the
<br />Bonds or the interest thereon, nor to enforce payment thereof against any property of the
<br />Issuer; neither the Bonds nor any document executed or approved in connection with the
<br />issuance thereof shall constitute a pecuniary liability, general or moral obligation, charge,
<br />lien or encumbrance, legal or equitable, upon any property of the Issuer; and the Bonds shall
<br />not constitute or give rise to a charge against the general credit or taxing powers of the
<br />Issuer.
<br />4. Application to Dartment of Employment and Economic Development, Approval of
<br />Projects. Pursuant to the Act, an Application to the Department of Employment and Economic
<br />Development of the State of Minnesota ("DEED") for approval the Project, together with the
<br />various exhibits thereto required by DEED, was placed on file with the City at the time that
<br />-notice was published, in accordance with the Act, of the Public Hearing. The Mayor, the City
<br />Clerk, the City Finance Officer and other officers and employees of the City are authorized to
<br />take such actions as may be required to submit the Application to DEED and obtain the approval
<br />therof from DEED, all pursuant to and as required by the Act.
<br />5. Preliminary approval. Preliminary approval is hereby given to the Project and the
<br />issuance of the Bonds, in an aggregate principal amount not to exceed $4,000,000; subject,
<br />however, to approval by DEED of the Project as tending to further the purposes and policies of
<br />the Act, and subject to final approval by the City Council of the details of the Bonds, the
<br />provision for payment thereof, and the forms of the legal documents to be entered into by the
<br />City in connection therewith, The Bonds shall not constitute a charge, lien or encumbrance,
<br />legal or equitable, upon any property of the City, except the revenues to be received from the
<br />Borrower specifically pledged to the payment thereof, and each Bond, when, as and if issued,
<br />shall recite in substance that such Bond, including interest thereon, is payable solely from said
<br />revenues and funds specifically pledged to the payment thereof, and shall not constitute a debt or
<br />pecuniary liability of the City within the meaning of any constitutional or statutory limitation.
<br />All costs of the City relating to the issuance of the Bonds, whether or not successfully
<br />issued, shall be paid or reimbursed by the Borrower.
<br />The Borrower and other parties are hereby authorized to undertake preparation of such
<br />documents as may be necessary or desirable in connection with the issuance of the Bonds,
<br />including a loan agreement to be entered into between the Issuer and the Borrower, a trust
<br />indenture to be entered into between the Issuer and a corporate trustee to be identified by the
<br />Borrower, and such further legal and disclosure documents as the Borrower may determine.
<br />6. Qualified Tax -Exempt Obligations, Pursuant to Section 265(b)(3) of the Internal
<br />Revenue Code of 1986, as amended (the "Code"), the City hereby designates the Bonds, in an
<br />amount not to exceed $4,000,000, as "qualified tax-exempt obligations," within the meaning of
<br />Section 265(b)(3). The Bonds are to be issued on behalf of an organization described in Section
<br />501(c)(3) of the Code and are to be issued as "qualified 50 1 (c)(3) bonds" under Section 145 of
<br />the Code. The City, together with all subordinate entities thereof, does not reasonably expect to
<br />issue tax-exempt obligations, including the Bonds (other than private activity bonds not
<br />constituting "qualified 501(c)(3) bonds") which, when added together with all such obligations
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