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INDENTURE – Disbursements from the Project Fund” hereto and upon the written request of the Borrower
in a Disbursement Request in substantially the form attached to the Loan Agreement as an exhibit in
compliance with the provisions of the Loan Agreement and of the Disbursing Agreement. No disbursement
shall be made by the Trustee upon the basis of any such Disbursement Request except upon satisfaction of
the following conditions and pursuant to the following procedures:
(1) An executed certificate of the FHA Lender substantially in the form attached as an
exhibit to the Loan Agreement or an executed certificate of the Borrower substantially in the form
attached as an exhibit to the Loan Agreement, related to the deposit of Available Money into the
Collateral Fund for the applicable Disbursement Request.
(2) All Loan Payments that are then due shall have been paid.
Each Disbursement Request for a disbursement of funds from the Project Fund shall be made in
accordance with the Disbursing Agreement and shall be deemed a representation by the Borrower that:
(i) All items for which disbursement is requested thereunder either (A) are presently
due and payable, constitute Project Costs properly incurred by the Borrower in connection with the
Project being financed with the proceeds of the Loan, or are reimbursable Project Costs properly
chargeable against the Loan; or (B) are to be deposited to an escrow fund to be disbursed therefrom
solely for Project Costs properly incurred by the Borrower in connection with the Project; and in
each case none of the items for which disbursement is requested has formed the basis for any
disbursement previously made from the Project Fund.
(ii) Each such item is or was necessary in connection with the rehabilitation of the
Dwelling Units (as defined in the Regulatory Agreement) of the Project.
(iii) The costs specified in the Disbursement Request, when added to all previous
disbursements under the Loan, will result in at least 95% of the aggregate amount of all
disbursements having been used to pay costs properly chargeable to the capital account of a
qualified residential rental project within the meaning of Section 142(d) of the Code and
functionally related and subordinate property thereto.
(iv) The costs specified in the Disbursement Request, when added to all previous and
all proposed future disbursements under the Loan, will result in the rehabilitation expenditures,
within the meaning of Section 147(d) of the Code, with respect to the Project [equaling or exceeding
15% of the portion of the cost of acquiring the Project] financed with proceeds of the Bonds.
(v) To the knowledge of the Borrower, there is no current or existing event of default
pursuant to the terms of the Loan Agreement or the Regulatory Agreement and no event exists
which by notice or passage of time or both would constitute an event of default under any of the
foregoing documents.
(vi) No representation or warranty of the Borrower contained in the Loan Agreement
or the Regulatory Agreement is materially incorrect or inaccurate, except as the Borrower has set
forth in writing, and there has been no event of default under the terms of any of those documents
and which is continuing and no event shall exist which by notice, passage of time or both would
constitute an event of default under any of those documents.
(vii) Each expense for which disbursement is requested was or will be paid on or after
the date of issuance of the Bonds. Notwithstanding the foregoing, the Borrower may be reimbursed
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