11-8-01 12. BOND PURCHASE AGREEMENT

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acceptance hereof by the Issuer and the Borrower. 1. Purchase and Sale. Subject to the satisfaction by the Issuer and the Borrower of the terms and conditions set forth herein, subject also to the conditions precedent set forth herein, and in reliance upon the representations herein set forth or incorporated by reference,the Underwriter hereby agrees to purchase from the Issuer upon the terms and conditions set forth herein and the Issuer hereby agrees to sell to the Underwriter the Senior Housing Revenue Bonds (Orono Woods ApartmentsApartment Project) Series 2001A(the "2001A Bonds") of the Issuer in the aggregate original principal amount of$ , the Senior Housing Revenue Bonds (Orono Woods Apartment Project),TaxableSenior - • o.Woods Apartment Project) Series 2001B (the "2001B Bonds"and,together with the 2001A Bonds, the "Senior Bonds")of the Issuer in the aggregate original principal amount of$ , and the Senior Housing Revenue Bonds (Orono Woods Apartment Project) Subordinate Senior Housing Revenue • • :.. -• ' . - Series 2001 C (the "2001 C Bonds")of the Issuer in the aggregate original principal amount of$ (the 2001A Bonds, 2001B Bonds and 2001C Bonds are collectively referred to herein as the "Bonds") (the Bonds being more fully described in Schedule I hereto,the Indenture and the Official Statement hereinafter mentioned). The proceeds of the Bonds shall be loaned to the Borrower for the purpose of financing a portion of the costs of developing, acquiring, constructing and equipping a 62-unit senior housing facility located in the City of Orono, Minnesota and designed to provide housing for the elderly located in the City of Orono, Minnesota(the"Project"), funding a Debt Service Reserve Fund to secure the Senior Bonds, funding capitalized interest during the construction :- ':. . . - . - and lease-up of the Project, and paying certain costs of issuance of the Bonds. The expenses of selling the Bonds shall be paid as provided in Section 7 hereof. The Bonds shall be as described in the Official Statement hereinafter mentioned, and shall be issued pursuant to the resolution of the Issuer approving the Bonds adopted on October 23, 2001 (the "Resolution"), the Indenture hereinafter mentioned, the Loan Agreement hereinafter mentioned,this Bond Purchase Agreement and certain related instruments. The Bonds shall be issued pursuant to a certain Trust Indenture of Trust, dated as of November 1, 2001 (the "Indenture")1 between the Issuer and U.S. Bank Trust National Association, as trustee (the "Trustee"). In connection with the issuance of the Bonds, the Borrower will enter into a Loan Agreement)dated as of November 1, 20012001, with the Issuer(the"Loan Agreement"),pursuant to which the Issuer will loan the proceeds of the Bonds to the Borrower. Terms not defined herein shall have the meaning given thereto in the Indenture. The Senior Bonds will be secured by a Combination-Teaseheld Mortgage, Security Agreement, Fixture Financing Statement and Assignment of Leases and Rents) dated as of November 1, 2001, between the Issuer and the Borrower(the "Mortgage"), and assigned by the Issuer without recourse to the Trustee (the"Mortgage Assignment"). The 2001C Bonds will be secured by a Subordinate Combination Mortgage, Security Agreement, Fixture Financing Statement and Assignment of Leases and parts, due as of November 1, 2001, between the Issuer and the Borrower(the "Subordinate Mortgage"), and assigned by the Issuer without recourse to the Trustee (the "Subordinate Mortgage