CERTIFICATE STATE OF NORTH DAKOTA ) ) CITY OF GRAND FORKS )

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3 CERTIFICATE STATE OF NORTH DAKOTA ) ) CITY OF GRAND FORKS ) The undersigned duly appointed, qualified, and acting Finance Director of the City of Grand Forks, North Dakota, hereby certifies that there is attached hereto a true and correct copy of the RESOLUTION RELATING TO A PROJECT UNDER THE MUNICIPAL INDUSTRIAL DEVELOPMENT ACT, GIVING THE PROJECT PRELIMINARY APPROVAL, SUBJECT TO A PUBLIC HEARING (VALLEY HOMES OBLIGATED GROUP), which was adopted by the City Council of the City of Grand Forks, North Dakota, on October 3, 2016, at a regular meeting of the Council which certified copy is an exact copy of the original on file in the office of the Finance Director. Dated this day of October, Finance Director

4 RESOLUTION RELATING TO A PROJECT UNDER THE MUNICIPAL INDUSTRIAL DEVELOPMENT ACT, GIVING THE PROJECT PRELIMINARY APPROVAL, SUBJECT TO A PUBLIC HEARING (VALLEY HOMES OBLIGATED GROUP) BE IT RESOLVED by the City Council of the City of Grand Forks, North Dakota (the City ), as follows: Section 1. Policy and Purpose For the purpose of promotion, attraction, encouragement, and development of economically sound commerce, preserving and developing a tax base adequate to finance necessary public services, and encouraging employment opportunities for the citizens of the City, the City is authorized by Chapter 40-57, North Dakota Century Code (the Act ), to issue revenue bonds of the City and loan the proceeds thereof to nonprofit corporations to provide senior housing and nursing facilities and to refund bonds previously issued under the Act to finance such facilities The City has previously issued its Senior Housing Refunding Revenue Bonds (4000 Valley Square Project) Series 2006, in the original principal amount of $23,700,000 (the 2006 Bonds ). Proceeds of the 2006 Bonds were loaned to 4000 Valley Square, a North Dakota nonprofit corporation ( 4000 Valley Square ) for the purpose of refunding bonds issued by the City in 1997 to finance the acquisition and construction of a 118-bed skilled care nursing home facility, a 60-unit apartment style assisted living facility and a 60-unit independent living facility with optional services located in the City Grand Forks County, North Dakota (the County ) has previously issued its Nursing Facility Revenue Bonds (Valley Homes and Services Project) Series 2009, in the original principal amount of $6,195,000 (the 2009 Bonds ). Proceeds of the 2009 Bonds were loaned to Valley Homes and Services, a North Dakota nonprofit corporation ( VHS ) for the purpose of constructing of a 36- bed transitional care unit located in the City The County has also previously issued its Nursing Facility Revenue Bonds (Valley Homes and Services Project) Series 2012, in the original principal amount of $7,700,000 (the 2012 Bonds ). Proceeds of the 2012 Bonds were loaned to VHS for the purposes of renovating a basic care facility located in the City (the 2012 Project ) and refunding bonds issued by the County in 2002, 2004 and 2006 to provide skilled nursing facilities Valley Square and VHS (together, the Obligated Group ) have jointly requested the City to issue its Senior Housing and Nursing Facility Revenue Bonds (Valley Homes Obligated Group) Series 2016A and Taxable Senior Housing and Nursing Facility Revenue Bonds (Valley Homes Obligated Group) Series 2016B (together, the Bonds ) for the purposes of (i) refunding the 2006 Bonds, (ii) refunding the 2009 Bonds (iii) refunding the 2012 Bonds, (iv) financing capital improvements to Valley Eldercare, a 212-bed skilled nursing facility owned by VHS, (v) funding a debt service reserve fund, and (vi) paying the costs of issuance of the Bonds

5 Section 2. Approval and Authorization Subject to the holding of a public hearing according to law and subject to the mutual agreement of the City, the Obligated Group, and the purchaser of the Bonds as to the details of the Bonds, the loan agreement, trust indenture and other necessary documents, the issuance of the Bonds of the City, in one or more series, in an amount not to exceed $38,500,000, is hereby approved Neither this preliminary commitment nor any actions, agreements, or legal matters related hereto or executed in pursuance hereof, shall in any manner or form create an indebtedness or liability of the City. The passage of this Resolution does not finally commit the City to issue and deliver the Bonds. Section 3. Public Hearing Because a public hearing, after notice according to law, is required for final approval of the Bonds, a public hearing on the issuance of the Bonds shall be held at the City Hall, Grand Forks, North Dakota at a regular meeting on November 7, 2016, beginning at 5:30 P.M. and the City Finance Director is hereby instructed to cause notice of such public hearing to be given according to law The form of public notice attached to this Resolution is hereby approved. Dated October 3, APPROVED: ATTEST: Mayor City Finance Director Motion for the adoption of the foregoing Resolution was made by Member, seconded by Member, and, upon a vote being taken thereon, the following voted in favor: ; the following voted against: ; and the following were absent: ; whereupon the Resolution was declared duly passed and adopted

6 NOTICE OF PUBLIC HEARING ON THE ISSUANCE OF SENIOR HOUSING AND NURSING FACILITY REVENUE BONDS UNDER THE MUNICIPAL INDUSTRIAL DEVELOPMENT ACT OF 1955 (VALLEY HOMES OBLIGATED GROUP) NOTICE IS HEREBY GIVEN that the City Council of the City of Grand Forks, North Dakota, will meet on November 7, 2016, beginning at 5:30 p.m. in the City Council Chambers, City Hall, Grand Forks, North Dakota, for the purpose of holding a public hearing on a proposal that the City issue one or more series of taxable or tax-exempt revenue bonds under the Municipal Industrial Development Act of 1955, Chapter 40-57, N.D.C.C., in order to refund certain outstanding bonds and to finance capital improvements to the facilities described below. The bonds to be refunded are (i) the City of Grand Forks, North Dakota, Senior Housing Refunding Revenue Bonds, Series 2006 (4000 Valley Square Project), (ii) the Grand Forks County, North Dakota Nursing Facility Revenue Bonds (Valley Homes and Services Project), Series 2009, and (iii) the Grand Forks County, North Dakota Nursing Facility Revenue Bonds (Valley Homes and Services Project), Series 2012 (together, the Prior Bonds ). Proceeds of the Prior Bonds were used to refinance certain prior bonds and to finance improvements to skilled nursing facilities, assisted living facilities and independent living facilities owned by 4000 Valley Square, a North Dakota nonprofit corporation ( 4000 Valley Square ) located at th Avenue South, Grand Forks, North Dakota and skilled nursing facilities and basic care facilities owned by Valley Homes and Services, a North Dakota nonprofit corporation ( VHS ) located at th Avenue South and 3300 Cherry Street, Grand Forks, North Dakota. The project consists of capital improvements to Valley Eldercare, a 212-bed skilled nursing facility located at th Avenue South, Grand Forks, North Dakota. Valley Eldercare is owned and operated by VHS. The amount of the proposed bond issue is not to exceed $38,500,000. The bonds shall be limited obligations of the City payable solely from the revenues of VHS and 4000 Valley Square pledged to the payment thereof, and may be secured by a mortgage or other encumbrances on the facilities of VHS and 4000 Valley Square. No holder of any such bonds shall ever have the right to compel any exercise of the taxing power of the City to pay the bonds, or the interest thereon, nor to enforce payment against any property of the City. VHS and 4000 Valley Square are engaged in the business of operating skilled nursing facilities, basic care facilities, elderly assisted living facilities and independent living facilities, and competitors are hereby notified of that fact pursuant to Chapter 40-57, N.D.C.C. All persons interested may appear and be heard at the time and place set forth above or may submit their views in writing before the time specified for the public hearing. BY THE ORDER OF THE CITY COUNCIL OF THE CITY OF GRAND FORKS, ND /s/ Maureen Storstad Finance Director - 3 -

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