PRILIMINARY OFFIC STATEMENT 11-15-2001 44.

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(whether by acceleration or otherwise)are nonrecourse against the Borrower and are secured only by the Collateral. (See "The Loan Agreement-Loan and Loan Repayments" in Appendix A to this Official Statement.) The Sponsor has no obligation under the Loan Agreement and has not guaranteed the Borrower's obligations thereunder. Attempts to foreclose under the Mortgage or the Subordinate Mortgage may be met with protracted litigation and/or bankruptcy proceedings, which proceedings cause delays. (See "ENFORCEABILITY OF OBLIGATIONS" herein.) Thus, there can be no assurance that upon the occurrence of a default under the Loan Agreement, the Trustee will be able to obtain possession of the Project and generate revenue therefrom in a timely fashion. Furthermore,there can be no assurance that the Project,if sold upon default under the Loan Agreement and foreclosure of the Mortgage and the Subordinate Mortgage, would realize an amount sufficient to pay all outstanding Series 2001 Bonds, any outstanding Additional Bonds and accrued interest. Foreclosure as a Remedy In the event of foreclosure under the Mortgage to pay the Senior Bonds,any proceeds thereof will be used to pay the Senior Bonds. The Mortgage and the Subordinate Mortgage constitute liens on the leasehold interest of the Borrower in the land on which the Project is located and is subject to the Ground Lease. The Mortgage and the Subordinate Mortgage also grant security interests in and assignments of all rents, revenues and profits of the Project and the Trustee, as leasehold mortgagee, could, in the event of default under the Series 2001 Bonds,pursue remedies under the Uniform Commercial Code. Foreclosure of a leasehold mortgage,such as the Mortgage and the Subordinate Mortgage,would only result in the ability of the Trustee or its assigns to occupy the land on which the Project is located in accordance with the terms of the Ground Lease. No fee title interest in such land could be received under foreclosure. Leasehold mortgage foreclosures in Minnesota are governed by statute and permit two alternative methods, "by action" or"by advertisement." The latter is normally utilized since it is slightly faster, less expensive and does not have the same tendency to invite contest as does foreclosure by action. The process is normally initiated by the publication,recordation and service of a notice of foreclosure. This notice must include all relevant information on the mortgage loan and the secured premises as well as a statement of the time and place of sale and the time allowed by law for redemption by the mortgagor. This notice must then be published in a legal newspaper each week for six consecutive weeks. Service of the notice on the mortgagor and any other affected party must be completed at least four weeks prior to the designated date of the foreclosure sale. Compliance with the above publication and service of notice requirements within the prescribed time limitations is essential to the validity of the mortgage foreclosure sale. Prior to the foreclosure sale,the mortgagor has the right to reinstate the mortgage and prevent foreclosure by curing all defaults on a current basis and by paying attorney's fees and out-of-pocket disbursements to the extent permitted by statute. If the mortgage is not reinstated, the foreclosure sale is held in the sheriff's office in the county in which the real