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Special Board of Aldermen 11-24-2020 Page 10

Celia Leonard, Deputy Corporation Counsel

Ok thank you John and thank you President. Good evening everyone. So! am going to talk about action
items which are reflected in the Omnibus for consideration in front of you today. There’s a $21 million
dollar bond which has been authorization and we’ve gone through the flow of funds, how that’s going to
work. And so the City has action items to get there. | am going to do them in order, both looking at the
Omnibus Resolution and | keep looking to the left because my screen is up on the left and also Tim’s
awesome graph where he put the approvals with the lines, even with my reading glasses it is a little hard
for me to see so we will wing it here. But overall approval of the deal as John was saying, the New Market
Tax Credit deal has a lot of variables as the overall projects sponsor, the City has responsibilities for
various guarantees and documents. And approval of one is a general Omnibus Approval within an
Omnibus. Even if we don’t know the name of the document now, if it comes up in the next two weeks, if it
helps to effectuate and is necessary, which actually is pretty much more where we are at now. We are
doing the necessary — it will be approved and we can move forward with confidence that the Board
understands and approves the actions the City needs to take.

We don’t anticipate much unanticipated, but of course that’s in here, so that’s why that’s one is there, that’s
why it is up at the top. Approval One — this is the structure and you agree that the City can forward under
these known details. Approval Two — is authorizing the transfer of title from the City who purchased it from
Alec’s Shoe Store to the QALIGB, the Impact Corp. there. That is the sale, it will net or bring $2 million
back to the City. The next approval is the City and these aren’t necessarily sequential, honestly it’s how |
thought of them in my mind, so that’s how it came out on the approval list. So the City will — on the other
side you can see Approval Three is the City entering into the Master Tenancy that has been discussed.
And also entering into equipment leases to fit up the Performing Arts Center with the specialty equipment
and AV and everything that goes into that, two separate documents, but Approval Three covers both of
them.

Approval Four has 3 parts; one is the loan which was discussed in detail by Niel of the $7 million, the
number says “up to $8 million” because at the time of drafting, there were still questions as to how much
exactly would have to go in. This number is driven exactly by how much New Market Tax Credit equity is
available. So that number, depending on how much equity is going to be — would have changed but we are
very confident it is pretty much going to be this $7,108,850.00 or whatever Niel said. But it will not be more
than $8 million. The next 4B is the payment or the transfer of the not to exceed $14 million; it is around
$13,8 million | think from Niel’s presentation apparently. That transfer of money to 201 Main Street Real
Estate Corp. and then Niel explained how that comes back up in to Impact Corp. the QALICB borrower.
And | think, I’m not positive if John mentioned it, but I'll just say again that Impact Corp. is a taxable entity
and that does impact the lease in that the City will issue real estate tax to Impact Corp. for holding,
obviously the real estate at what we call 201 Main Street. That is factored into the lease payments and will
be a circular transaction back to the City.

The Third Approval 4C is that in addition to the loan and the transfer of those bond funds, there’s various
documents that need signing, closing statements, department certificates, settlement statements, etc., and
this authorizes the City to not only do those discreet transactions but all of the dozens, I’m trying to think,
we go through a closing agenda now twice a week of what over 100 documents that we are looking at,
different discreet. Approval 5 is authorizing the City as Master Tenant to enter into an agreement with
Spectacle. Now the Board has already approved an MOU as | recall, put it in the whereas is. And this is
further authorization that the final agreement can be entered into. The Reference Community Benefits
Agreement which | know is very important to the Board and to the City is also important to our investor and
to the overall New Market Tax Credit structure and portions of that — important portions about tracking the
community benefits are going to be incorporated via contract into that Spectacle Management Contract.
We have been in negotiations and discussions with Spectacle and they have been really open and excited
to participate with the City.

Special Board of Aldermen 11-24-2020 Page 11

The next approval is Approval 6 which authorizes the City to then sign all the contracts that you’ve and the
Finance Committee have already approved such as the construction contract and the architect contract.
Those are the two main ones that I’m thinking of, but if we find any other what | would call “smaller” but |
don’t mean to say that they are less important, PO’s or items that didn’t rise to the level of the City’s
purchasing threshold to come to Finance or the Board all those Performing Arts Center contracts that are
still viable and need action will be assigned to the QALICB, the Impact Corp. Next is Authorizing — there’s 7
and 8 are guarantees but they are different guarantees. Approval 7 relates back to the community, the
CDFA, the Community Development Finance Authority Tax Credits that came into the City and this Board
recently authorized their transfer to the fundraising arm, Nashua Community, not arm excuse me,
fundraising entity Nashua Community Arts. And the City’s guarantee there is that there’s going to be a
performance guarantee meaning that Performing Arts Center will, in fact, be run as a Performing Art
Center. So that is not a debt guarantee, that is an actual performance guarantee.

Approval 8 is a debt guarantee. What it allows the City to do is utilize future funds for current gain, the
Mascoma money goes away at the end of the year. If we were not able to close this deal, we would not be
able to avail ourselves the non-City money of almost $2.5 million dollars. So as part of that, there’s a
bridge fund because there are pledges that are going to come in over a little bit of time, they are not going
to come in directly on or before December 15" come in as cash. That amount is under $100,000.00, | think
at last tally that might be, | know Rich Lannan is on but it’s down lower. So the City will step into the shoes
of Nashua Community Arts there if for some reason Nashua Community Arts isn’t able to gather the
pledges, the City can take over and get those pledges and make sure that those private funds come into
the deal.

And lastly is Approval 9 which with the transfer of real estate to a for profit corporation, Impact, comes the
City’s fee structure. As other developers in the City face on a daily and weekly basis, but this is asking you
to waive for this project the permit and inspection fees which, although we don’t have any final numbers,
very ballpark figure, we are looking at around, that would be a cost to the project about 50, five-zero,
thousand dollars so that’s Approval 9. So those are the Action Items. A little more background information
about what this Resolution, if approved, would effectuate for the City and for the New Market Tax Credit
Deal.

Director Cummings

So if | may, Madam President, just lastly, | would ask Andy Prolman to talk about his involvement relative to
the real estate.

Andy Prolman, Attorney

Madam President and members of the Board, Good Evening, | am Andy Prolman with Prunier & Prolman.
My role in this transaction is relatively simple and straight-forward. | am the Title guy. My task is to make
sure that the Title of the real estate into Impact is good and it is, we’ve run our Title updates so we are in
good shape there. | am to help coordinate the transfer from the City of Nashua to Impact, do the actual
hands-on recording at the Registry of Deeds. | record the mortgage that Impact will be granting back to the
Mascoma subsidiary entity. We will be reviewing the lease and recording a Notice of Lease at the Registry
as John said for the 25 year lease with the 5-year option. And | can tell you that from my perspective,
everything looks good with respect to the title aspect. First American Title Insurance Company has issued
a title of commitment to ensure Title to both Impact and the Mascoma entity. And we look like we are teed
up to get this closed by the December 15" deadline. We've been working with Celia and Tim and the whole
team and we will be ready to go, ready to record to close this on the 15". That’s all | had. Thank you.

Director Cummings

And thank you Andy. So first | want to apologize, | didn’t realize, | wanted to double check to make sure
that the other piece of Legislation that is important to this deal structure was on the Agenda this evening
and itis. And it’s relative to creating a Board of Trustees as a standing Committee of the City of Nashua.

Special Board of Aldermen 11-24-2020 Page 12

That’s this blue, highlighted entity right here which is essentially the same language that was used to create
the Hunt Board for the Hunt Library. So that’s a separate piece of Legislation, though it goes part and
parcel with this. | just wanted to reference it because, of course, we are looking to try to get a favorable
recommendation on that piece of Legislation after this particular topic closes this evening. It is not as
imperative that that piece of Legislation get voted on at your following evening. But, of course, if you are of
interest and of mind to do it, we would certainly welcome it. But there is not as much time sensitivity for
that separate piece of Legislation so that could go through the normal course of business.

Anyway, so | wanted to just quickly clarify that and Madam President, | am going to stop sharing my screen
here as that is essentially our formal remarks that we had prepared to quickly highlight how this deal was
going to be effectuated and | would close my comments by reminding everyone that we have been working
on this for a really long time and it’s been a huge effort within the community. We have got some great
support from various volunteers, | can’t say enough about all of them who have been involved; | am not
going to name them out of fear that | might leave someone out. But they all know who they are and it’s
been a pleasure working on this project. | am excited to bring it to fruition. So thank you and | ask for your
favorable consideration.

President Wilshire

Thank you everyone, thank you Director Cummings and everyone who was here to present, Mr. Cannon,
Celia, everyone who was involved, thank you all very much. | am going to start with questions from the
Board, if anyone has questions? No questions? Alderwoman Lu?

Alderwoman Lu

Thank you Madam Chairman, Madam President. | have several questions, so | am sorry if | am the rare
person who needs some help here. So if | could just get some clarification on — | understand the dynamics
of the Call and the Put, but what | am confused about is whether the Put is to sell their part, Mascoma’s

Put, they may be willing to sell for $1,000.00 or is it $10,000.00 or something, their interest in the financing
corp. or their interest in the real estate or is it their interest in the Impact?

Attorney Kaminski

Madam Chair, may | answer that?

President Wilshire

Mr. Kaminski, please?

Attorney Kaminski

It is their interest in the investment fund. Tim, if you could put that diagram up please?

Alderwoman Lu

Maybe he’s not here.

Mr. Kaminski

No | see him staring at the screen intently, trying to make it happen but as he’s doing that, let me explain
further. All that Mascoma is going to own here is an interest in the investment fund. The investment fund
doesn’t own the real estate, all the investment fund is, is the pooling vehicle that pools the Mascoma money
and the City’s $7.something million dollar loan together and sends that money down through the structure.

So they don’t own the real estate, all they own is an interest in the investment fund and all the investment
fund owns are the rights to collect the loans that are being paid by Impact through the structure.

Special Board of Aldermen 11-24-2020 Page 13

As those loans are being paid up through the structure, remember that money to repay those loans goes
over to repay the City’s $7. something million dollar loan. So once they have finished taking the Tax
Credits over the 7 year period of time, they don’t own very much at all. They own just a few rights in the
investment fund, nothing to do really with the real estate, just with respect to that debt that is largely being
repaid back to the City. Does that answer your questions?

Alderwoman Lu

Yes, | am not sure | understand it completely. But does their interest, is it their interest in the fund reduced
over time?

Mr. Kaminski

Their benefit is reduced over time because they claim the New Market Tax Credits. They claim their credit
over a 7 year period of time; a slice in Year 1, a slice in Year 2 and so forth. By year 7, they claim them all
and that’s their primary economic benefit.

Alderwoman Lu

Ok, thank you that makes sense. So they don’t have anything to gain after the 7 years? OK. So could |
just ask three other questions?

President Wilshire
Yes.
Alderwoman Lu

Ok, how is it, | think Attorney Leonard mentioned that when we close on the sale of the building that the
purchase price will go back to the City. Now is that going to stay back at the City?

Mr. Kaminski

Yes the City is selling the real estate for $2 million dollars to Impact Corp. and that $2 million dollars that is
received from Impact Corp. is the sale proceeds to the City.

Alderwoman Lu
OK, | didn’t remember whether our bond amount included the purchase price for the building. | am
guessing it did. And how many municipalities, | understand this sounds like a process that is typically

geared toward businesses and we are kind of going some convoluted actions here to make it fit within a
municipality. Do many municipalities go through this rigmarole? Thank you?

Director Cummings
| can speak to it as well after Niel.
President Wilshire

Mr. Cannon.

Special Board of Aldermen 11-24-2020 Page 14
Mr. Cannon

Thank you, Madam Chairman. You are exactly right, Alderman Lu in it is a bit more complicated because
of the actions we have to go through to create, first of all, the City as a Master Tenant because the
municipality cannot be a borrower and then to get the City Bond Funds and to create the senior leverage
lender which is the 201 Main Street Corp. It’s not done often, | have been involved in two projects where it
has been done, both are in Keene where municipal bonds were used to build the Cheshire County
Courthouse and lease it to the county and to do an addition to the Library, a small project. But as |
understand it, it is little more frequently used in the mid-west and other areas, but New Hampshire and
probably Vermont and Maine, there’s only 3 or 4 incidents and this will be one of them.

Director Cummings

And then if | may Madam President to follow on to that. | am very familiar with the project in the City of
Boston where the City of Boston decided to move all of our their administrative offices and the School
Department to a lower income area called Dudley Square and they built a new Administrative Office for
their Department of Education and they used New Market Tax Credits to do that as well so it wouldn’t be a
much money on the property tax (inaudible).

Mr. Kaminski

And if | may add to that? | am familiar with a couple of transactions that were done in Maine, the Mid Coast
Regional Redevelopment Authority that’s redeveloping what used to be the Brunswick Naval Air Station. It
has participated in two New Markets Tax Credit transactions; it is a Governmental Entity chartered by the
State of Maine. So it does happen, not with a lot of frequency in this part of the country, but there is
precedent for it and you folks will not be pioneers in doing this.

President Wilshire

Are you all set Alderman Lu?

Alderwoman Lu

| have one other question that | wanted to ask about which is — the approval number 8 concerns me. |
would feel better if we had some — the pledges is it correct that the on or received we have all but
$100,000.00 in hand of that $1.553 million because | thought that was what | heard. | thought | heard that

under $100,000.00 needs to be guaranteed under Approval #8. So | am concerned about that, how much is
it exactly that is a pledge? | had hoped that it is a pledge and not cash in hand.

Director Cummings

So if | may Madam President?
President Wilshire

Director Cummings?

Director Cummings

Yes thank you and | am sorry my data might be a little slow so | might be a little delayed. But nonetheless
relative to the question at hand, | can speak to where the Nashua Community Arts is relative to fund raising
if you’d like. Before | do that, | want to preface my comments and remind you all that early on we had
always said that pledges and cash would be counted. Can everyone hear me?

Special Board of Aldermen 11-24-2020 Page 15

President Wilshire

Yes.

Director Cummings

Ok so we always had said from the very beginning that cash and pledges and would be always understood
to be part of the fund raising and not just solely cash. The cash is necessarily to effectuate the New Market
Tax Credit deal which is why we are pivoting in this direction. | can, if everyone can see my screen, | am
going to share my screen for a quick second here. | have a letter from Deb Novartny which outlines that
they have $780,000.00 in cash on hand, that’s of today. Pledges received, they had $760 so they'll have
more than the $1556 available and the guarantee, if you will, would be for, if I’m reading this correctly, for
approximately $760,000.00. So | just want to make sure you had that information as well.

Alderwoman Lu
Are you all set Alderwoman Lu?
Alderwoman Lu
Yes, |am. If Director Cummings has a chance to shoot that over, that’s something that would be, I’d love
to see that, have a chance to look at what years those are coming in. | am a little concerned about
guaranteeing, but thank you, |’m all set.
President Wilshire
Anyone else, questions? I’m not seeing anyone. OK, well the Motion before us is to recommend final
passage of Resolution 20-094. If there’s no one with questions, | am going to ask the Clerk to please call
the roll?
A viva voce roll call was taken which resulted as follows:
Yea: Alderman O’Brien, Alderman Klee, Alderwoman Kelly, Alderman Dowd,

Alderman Clemons, Alderman Lopez, Alderman Tencza,

Alderman Jette, Alderman Schmidt, Alderman Laws,

Alderman Cleaver, Alderman Harriott-Gathright, Alderman Wilshire

13

Nay: Alderman Caron, Alderwoman Lu

MOTION CARRIED

Special Board of Aldermen 11-24-2020 Page 16

NEW BUSINESS — ORDINANCES

O-20-036

Endorsers: Mayor Jim Donchess
Alderwoman-at-Large Shoshanna Kelly
Alderman Richard A. Dowd
Alderman Skip Cleaver
Alderman Linda Harriott-Gathright
Alderman Patricia Klee
Alderwoman Elizabeth Lu
Alderman-at-Large Michael B. O’Brien, Sr.
Alderman-at-Large Ben Clemons
Alderman-at-Large Lori Wilshire

ESTABLISHING PERFORMING ARTS CENTER BOARD OF TRUSTEES

MOTION BY ALDERMAN O’BRIEN TO RECOMMEND FINAL PASSAGE BY ROLL CALL
ON THE QUESTION

President Wilshire

Director Cummings, did you want to talk a little bit about this one as well?

Director Cummings

You know, Madam President, I'll just keep my comments very brief. | would like favorable passage of it this
evening if | could. This, again, would be the standing Committee that would be, if you will, the governance,
that would oversee the Performing Arts Center and would be very or substantially similar to the Hunt
Building in how we have that structured. Thank you.

President Wilshire

Thank you. Alderman Clemons?

Alderman Clemons

Thank you. | was reading that and | just have a question about that and my question is, in the Ordinance
as it is proposed and thinking about how the Hunt Building Trustee is as well, is there an Aldermanic

Liaison on this in the Legislation because | didn’t read that. And I’m wondering if that is something that we
should add to the Legislation?

President Wilshire
| could ask either Director Cummings or Attorney Bolton?

Director Cummings

| will pull up the Legislation right now to look at it more closely but what | can tell you is the template that we
used, is we created, using the Hunt and | can tell you the Hunt does have a Legislative Liaison to it. So, |
am going to double check that right now.

President Wilshire

Thank you. Alderman Clemons?

Special Board of Aldermen 11-24-2020 Page 17
Alderman Clemons

Yeah, is that a voting member on the Hunt Trustee or is just a Liaison do we know?

President Wilshire

| believe it is a non-voting member?

Director Cummings

No full voting.

President Wilshire

Oh full voting member.

Alderman Clemons

If | could if this Legislation doesn’t have that, | would recommend that we add that a voting member
appointed by the President of the Board. So | am going to make that motion tentative to amend.

MOTION BY ALDERMAN CLEMONS TO AMEND O-20-036 TO ADD A VOTING LIASIOIN FROM THE
BOARD OF ALDERMEN TO THE COMMITTEE BY ROLL CALL

ON THE QUESTION

President Wilshire

Alderman Clemons that’s your motion? OK discussion on that motion? Alderwoman Klee?

Alderman Klee

Thank you, Madam President. | agree with Alderman Clemons’ comments about it, as having been a
person that was on the Hunt Memorial, two years. | think it is important to have a voice from the Board of
Aldermen on it. You know, as important as this project is, just like the Hunt, | think we do need to have a
voice on the Board of Trustees.

President Wilshire

Further discussion on the motion to amend? Alderman O’Brien?

Alderman O’Brien

As making the original motion, | strongly support Alderman Clemons’ motion to amend. Thank you.
Alderman Dowd

Yes, | also support it. If for no other reason, it’s a conduit for information coming back to the Full Board.

President Wilshire

The Motion before us is to amend, further discussion on that? Director Cummings?

Special Board of Aldermen 11-24-2020 Page 18

Director Cummings

Madam President, | see Celia Leonard wants to speak and then | also just want to clarify, | think you want
to have two Aldermanic Members, | think it’s a 9 person Board, | would recommend it be 11. But with that
being said, | think Deputy Corporation Counsel has something to say.

President Wilshire

Attorney Leonard?

Attorney Leonard

Yes, thank you, if | may. | am scrolling through our Ordinances, it appears, | apologize, the Liaison portions
are in Section 5.9 of the Ordinances, not in the — so we would be amending a different section. We can
effectuate the Board’s wishes to have a Liaison it just wouldn’t — | suppose we could do it in either, but just
to let you know we did model this Legislation after the Hunt and the reason that it wasn’t in there is because
the Hunt Liaison is in Section 5.9 not in the establishing Legislation for the Hunt Committee. So we can put
it either place, but that’s a clarifying of why it didn’t show up.

President Wilshire

OK, thank you.

Director Cummings

And if | may just correct the record, | was just informed that it’s technically a non-voting member. The
Aldermanic Liaison is a non-voting member. So | think it’s the spirit in which that this be a voting member
so it would be two voting members of the Board of Aldermen.

Alderman Clemons

Can | ask why the need to have 11 is there a reason to avoid deadlocks or | don’t particularly seeing this
being a controversial?

Director Cummings

If | may, no it doesn’t need to be 11 per se, it could be less than that and we could reduce the 9 down to 7
and then add in two for 9 or we could reduce it down to 8 and add in the Aldermanic Liaison for a full
complement of 9. As you point out, it’s not going to be relatively controversial so happy to do whatever the
pleasure of the Board is.

Alderman Clemons

| guess my question is why the odd number as opposed to an even number?

President Wilshire

Well typically we do that so there’s not a deadlock.

Director Cummings

| would recommend it as good governance just so you can have an odd number in case votes are called.

Special Board of Aldermen 11-24-2020 Page 19
President Wilshire
Attorney Bolton?

Steve Bolton, Corporation Counsel

It’s sort of traditional to establish Boards and Committees with an odd number and ostensibly that’s to make
ties less likely. Frankly, you often have even numbers present and if you get a majority the motion passes,
if it’s tie, that’s not a majority. So it is not required anywhere that it be an odd number, but it is sort of
tradition.

President Wilshire

So speaking of tradition, it’s typically the liaison and the alternate. So | don’t think you add two people as
voting members, | think you add an alternate, | mean a liaison and if the liaison can’t make it to a meeting
the alternate goes and they have a vote. | think it should only be one vote from the Board, do you agree
with that Alderman Clemons?

Alderman Clemons

| do and | also don’t think that having 10 members is, in my opinion, problematic. So | would leave my
motion but amend it to add an alternate as well.

MOTION BY ALDERMAN CLEMONS TO AMEND O-20-036 TO ADD A VOTING LIASIOIN AND AN
ALTERNATE FROM THE BOARD OF ALDERMEN TO THE COMMITTEE BY ROLL CALL

ON THE QUESTION

President Wilshire

OK, Alderman Lu?

Alderwoman Lu

Thank you. | would like to know why you feel that it’s best not to have two to only have one? And it seems

to me because | don’t or am not very familiar with appointing boards. This is a Board of Trustees rather
than a Board of Directors. So if you could just clarify the difference for me?

Attorney Bolton

There’s no difference.

President Wilshire

I’m not sure there is a difference, right. Alderman Gathright?

Alderman Harriott-Gathright

Sorry, you mentioned, that there’s 11 or 9. Which one is it?

Director Cummings

So | am going to just say it’s 9 members as of right now, but | believe that there is a motion pending by
Alderman Clemons to make it one additional voting Aldermanic Liaison for a total of 10, if | summarize that
correctly.