RESOLUTION NO. R-11-06 OHIO CULTURAL FACILITIES COMMISSION FEBRUARY 8, 2011 A RESOLUTION CONFIRMING THAT THERE IS A NEED FOR THE PROJECT RELATED TO THE NATIONAL UNDERGROUND RAILROAD FREEDOM CENTER, CONFIRMING THAT THERE IS SUBSTANTIAL REGIONAL SUPPORT FOR THE PROJECT, CONFIRMING THE CONSTRUCTION ADMINISTRATOR, CONFIRMING PROVISION OF GENERAL BUILDING SERVICES, APPROVING THE PROJECT AND AUTHORIZING THE EXPENDITURE OF FUNDS, AUTHORIZING THE RETURN OF ESCROW FUNDS, AUTHORIZING THE EXECUTION OF A CAPITAL EXPENDITURE REIMBURSEMENT AGREEMENT AND CERTAIN OTHER DOCUMENTS AND THE TAKING OF CERTAIN OTHER ACTIONS. WHEREAS, the Ohio General Assembly (the “General Assembly’) established the Ohio Cultural Facilities Commission (the “Commission’) under Chapter 3383 of the Ohio Revised Code (the “Act") to engage in and provide for the development, performance, and presentation or making available of culture to the public, including the provision, operation and management of Ohio cultural facilities, as defined in the Act; WHEREAS, pursuant to Section 3383.07(D) of the Act, the General Assembly required that state funds, including the proceeds of state bonds, not be spent on the construction of any Ohio cultural facility until (i) the Commission has determined that there is a need for the cultural project and the Ohio cultural facility related to the project in the region of the state for which the Ohio cultural facility is proposed to be located, and (ii) provision has been made, by agreement or otherwise, satisfactory to the Commission, as an indication of substantial regional support for that Ohio cultural facility, for local contributions amounting to not less than fifty (50) percent of the total state funding for the cultural project and the Commission has established guidelines for such evaluation and determinations; WHEREAS, the General Assembly previously appropriated for the National Underground Railroad Freedom Center an aggregate amount of $14,650,000 and the Commission previously approved the project, executed the appropriate legal agreements and paid that amount; WHEREAS, prior project approvals authorized expenditure of appropriated funds on exhibits, furniture, fixtures and equipment located in the National Underground Railroad Freedom Center (the “Facility’); WHEREAS, the 127th General Assembly in Am. Sub. H.B. 562 appropriated bond funds in the amount of $850,000 in ALI C371H2 for National Underground Railroad Freedom Center, owned and operated by National Underground Railroad Freedom Center (the “Project Sponsor’). The Project Sponsor proposes to utlize the appropriation for exhibits, furniture, fixtures, equipment and construction “hard cost” expenses previously incurred during the Facility construction (the *Project"); WHEREAS, the Project Sponsor came before the Commission on February 11, 2010 and received approval for a Memorandum of Understanding (MOU) spelling out the conditions under which full approval could be granted to the Freedom Center for the most recent appropriation of $850,000;WHEREAS, the Project Sponsor has eliminated its debt, developed alternate plans for continuing its operations, including but not limited to its plans to pursue federalization of the Facility, and has provided a guaranty to secure the $850,000 appropriation; WHEREAS, in accordance with requirements of prior Commission approvals, the Project Sponsor previously provided to the Commission funds for an escrow account, and Project Sponsor has now requested retum of said escrow funds in exchange for Project, Sponsor providing a guaranty of an equal amount; WHEREAS, the Ohio General Assembly has authorized the Treasurer of State to issue bonds for the purpose of funding Ohio Cultural and Sports Facility projects, including the Project, which issuance the Treasurer of State has or will undertake; WHEREAS, the Project Sponsor, operating as a 501(c)(3) non-profit corporation, is the fee simple owner of the Facility; and WHEREAS, the Commission has reviewed the Project Sponsor's financial statements, revised business plans proposed guaranty, and the Commission staff recommendation, and has also heard and considered oral presentations made at the Commission meeting held on the date of this resolution NOW, THEREFORE, BE IT RESOLVED: Section 1. Confirmation of Need. In accordance with Section 3383.07(D\(1) of the Act, the Commission hereby confirms that there is a need for the Project in the region of the state where the Project is located, Section 2. Confirmation of Substantial Regional Support. In accordance with Section '3383.07(D)(2) of the Act, the Commission hereby confirms that, as an indication of substantial regional support for the Project, provision has been made and evidence presented to its satisfaction that local contributions will amount to not less than fifty (50) percent of the total state funding for the project and that such anticipated contributions, together with the state funds, will result in full funding for the Project. Section 3. Confirmation of the Construction Administrator. The Commission hereby accepts the recommendation of the Executive Director and independently confirms that the Project Sponsor be permitted to act as construction administrator on the Project in accordance with Section 3383.07(A) of the Act. Section 4. Confirmation of the Provision of General Building Services. The Commission hereby confirms that the Project Sponsor shall provide general building services, in accordance with Section 3383.07(C) of the Act. Section 5. Approval of the Project, Authorization of the Expenditure of Funds and Authorization to Retum Escrow Funds. In accordance with Section 3383.07 of the Act, the Commission hereby approves the Project, authorizes the expenditure of funds in an amount not to exceed $850,000 and authorizes the return of escrowed funds in the amount of $462,306.60 to the Project Sponsor, subject to the following conditions: (i) the Project Sponsor provides the Commission staff with evidence of its real property interest in the site (for a period of at least fifteen [15] years), free of any mortgages, liens or other encumbrances unacceptable to the Executive Director of the Commission in her sole discretion;(iy (iii) (iv) ™) (vi) (vi) willy (ix) (&) (xi) the Project Sponsor provides the Commission staff with a certification that information contained in documents submitted to Commission staff is true and accurate to the best of the Project Sponsor's knowledge and belief, that this certification extends to future submissions, and acknowledging the receipt of this resolution and the conditions set forth herein; the Project Sponsor provides the Commission with evidence satisfactory to the Executive Director of the Commission that it is an eligible 501(c)(3) corporation in good standing with the Internal Revenue Service; the Project Sponsor provides the Commission with evidence ‘satisfactory to the Executive Director of the Commission that it is in good standing with the Attorney General's Office, Charitable Law Section; the Project Sponsor provides the Commission with evidence satisfactory to the Executive Director of the Commission that it is in good standing with the Secretary of State's Office; a search of the Auditor of State database established pursuant to Section 9.24 of the Ohio Revised Code concludes that the Project ‘Sponsor has no unresolved findings for recovery; the Project Sponsor provides the Commission staff with copies of the construction bids, consultants’ contracts and construction contracts; the Project is Fully Funded. “Fully Funded” means that funds have been raised for the total costs of the Project including all hard costs, soft costs and start-up costs and any operating endowment for the Project. “Raised” means receipt of written pledges from creditworthy entities, written funding commitments from governmental entities, written guarantees from creditworthy entities (in a form approved by the Ohio Attorney General's Office), cash receipts or any combination of the foregoing, all as determined in the sole discretion of the Executive Director of the Commission; the Project Sponsor provides the Commission staff with complete, accurate and updated documentation of material changes in project costs, project scope or other relevant information affecting the organization or the Project; the Project Sponsor and the Commission execute a Capital Expenditure Reimbursement Agreement and amendments to the Cooperative Use Agreement, the Management Agreement and Base Lease, and any other required documents on or before the Commission's third quarter 2011 meeting; the Project Sponsor has provided the Commission staff with a copy of its resolution or ordinance authorizing its execution of a 3(xii) (xi) (xiv) Co) (xvi) (vil) (wii) (xix) (x) Capital Expenditure Reimbursement Agreement, amendments to the Cooperative Use Agreement, Management Agreement and Base Lease, and any other required documents; the Attomey General has reviewed and approved the document(s) as to form, as appropriate; the Controlling Board or the Director of the Office of Budget and Management, as required by law, approves and certifies the release and availability of funds; the Project Sponsor provides the Commission with a signed Declaration Regarding Material Assistance/Nonassistance to a Terrorist Organization (DMA) pursuant to Senate Bill 9 of the 126" General Assembly; the Project Sponsor provides the Commission with a signed Affirmation and Disclosure Form pursuant to Executive Order 2010-095 “Banning the Expenditures of Public Funds for Offshore Services; and the Project Sponsor provides any other documents requested by Commission staff; the Project Sponsor provides a guaranty by John and Frances Pepper, in conformance with the Commission's standard form guaranty document, guaranteeing the $850,000 appropriation; the Project Sponsor provides a guaranty by John and Frances Pepper, in conformance with the Commission's standard form. guaranty document, guaranteeing an amount equal to the $462,306.60 currently held in escrow plus 1) interest based on the monthly average one-year constant maturity Treasury yield (‘CMT") compounded annually; and 2) increases determined by the periodic review of estimated costs involved with a closed down facllty covering a period of six months; the Project sponsor provides a business plan and budget for FYE 2011 and FYE 2012, approved by the Freedom Center board of directors, addressing the necessary steps the Freedom Center will take in the event federalization legisiation does not take place; the legal agreements for the Project are amended to require that prior to federalization should federalization be pursued, an opinion of nationally recognized bond counsel, acceptable to the Ohio Public Facilities Commission (the “OPFC’), the Treasurer of State and the Commission, and addressed to the OPFC, the Treasurer of State and the Commission, stating that the financing structure, ‘ownership and/or operational/management structure will not a) adversely affect the validity of the state-issued tax-exempt bonds; and b) will not adversely affect the exclusion of the interest on the state-issued tax-exempt bonds from the gross income of the holders of the state-issued tax-exempt bonds for federal income tax purposes; 4(xx) the legal agreements for the Project are amended to require that prior to federalization, the new financing structure, ownership and/or operationalimanagement structure for the project and Sponsor organization is approved as acceptable to the Commission Secretary-Treasurer, in his/her sole discretion; (xxii) the Project Sponsor provides evidence that the bank lien on the Facility has been released; (xxiii) The Project Sponsor agrees to provide quarterly financial statements, including budget to actual schedules, no later than thirty days after the end of each calendar quarter until the state bonds used to pay costs of construction of the Facility are fully amortized; (xxiv) The Project Sponsor provides a security agreement defining as collateral all intangible and tangible assets including cash and receivables. Section 6. Authorization of Execution of a Capital Expenditure Reimbursement Agreement, and Amendments to the Cooperative Use Agreement, Management ‘Agreement and Base Lease. The Chairman or the Executive Director of this Commission be, and hereby is, authorized and directed to execute and deliver, or cause to be executed and delivered, a Capital Expenditure Reimbursement Agreement and ‘Amendments to the Cooperative Use Agreement, Management Agreement and Base Lease, with the Project Sponsor, in the name and on behalf of the Commission, as the Chairman or Executive Director deems necessary or appropriate to carry out the intent of the foregoing resolution. The execution of such agreements by the Chairman or the Executive Director shall be conclusive evidence of the exercise of the discretionary authority conferred herein. Section 7. Authorization of Execution of Guaranty Agreement for the $850,000 Appropriation, Execution of a Guaranty Agreement for the return of $462,306.60 of Escrow Funds and Taking Other Actions. The Chairman or the Executive Director of this ‘Commission be, and hereby is, authorized and directed to execute and deliver, or cause to be executed and delivered, Guaranties with the Guarantors, and all such other documents, agreements, instruments or certifications, or to do, or cause to be done, all such acts and things, in the name and on behalf of the Commission, as the Chairman or the Executive Director may deem necessary or appropriate to carry out the intent of the foregoing resolution. The taking of such action or the execution of any such agreements by the Chairman or the Executive Director shall be conclusive evidence of the exercise Of the discretionary authority conferred herein. Section 8. Other Matters. The Project Sponsor shall keep the Commission staff informed in writing and by presentation at a future Commission meeting, if requested by the Commission or its Executive Director, of any matters financial, organizational, or otherwise that will have any impact on the construction of the Project and/or operation of the cultural facility Section 9. Open Meeting. All formal actions of this Commission conceming and relating to the adoption of this resolution were taken and adopted in an open meeting of this, ‘Commission, and all deliberations of this Commission that resulted in those formalactions were in meetings open to the public, and in compliance with all legal requirements including Ohio Revised Code Section 121.22. IN WITNESS WHEREOF, the undersigned hereby certifies that the foregoing Resolution was duly adopted at a meeting held on February 8, 2011 by the members of the Ohio Cultural Facilities Commission. larshall, CPA, Secretary-Treasurer