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(b) The Borrower agrees that it will not request any disbursement under the Loan for:
(i) the acquisition and rehabilitation of a building (and any fixtures thereto), the "first
use" of which is not pursuant to such acquisition within the meaning of Section 147(d) of the Code,
unless the Borrower shall expend from Loan proceeds or other available sources, an amount at least
equal to fifteen percent (15%) of "the portion of the cost of rehabilitating such building (and
equipment) financed with the proceeds" of the Bonds for "rehabilitation expenditures" within the
meaning of Section 147(d) and of the Code with respect to such building and fixtures;
(ii) the acquisition of land (or an interest therein) in any amount which would cause
the aggregate amount therefore and thereupon disbursed for such costs to equal or exceed twenty-
five percent (25%) of the net proceeds of the sale of the Bonds; or
(iii) any portion of the Project which would cause the "average reasonably expected
economic life", as determined in the manner and as of the time provided by Section 147(b) of the
Code, of the portion of the Project that has been, or pursuant to such requested disbursement is to
be, financed with proceeds of the Loan to be less than one day more than eighty-three and one-third
percent (83 1/3%) of the "average maturity" of the Bonds within the meaning of Section 147(b) of
the Code.
If for any reason disbursements under this Section 5(b) in excess of the limits imposed by paragraphs (i),
(ii) or (iii) set forth above shall be made, or if, assuming after any disbursement that no further
disbursements were made under the Loan Agreement, such limits would be violated by measurement
against the amount of disbursements theretofore made, the Borrower agrees to reimburse the Trustee under
the Indenture for the portion of any such excess as would be necessary to assure the exclusion of the interest
payable on the Bonds of the holders thereof from gross income for federal income tax purposes.
(c) The Borrower agrees that it will not request any disbursement under the Loan for any costs
of:
(i) any portion of the Project constituting a "health club facility," a "facility primarily
used for gambling," or a "store the principal business of which is the sale of alcoholic beverages
for consumption off premises" within the meaning of Section 147(e) of the Code;
(ii) land, or an interest therein, to be used for "farming purposes" within the meaning
of Section 147(c)(2) of the Code; and
(iii) any property, other than a building (and fixtures located therein as of the date of
the building's acquisition), the "first use" of which is not pursuant to such acquisition within the
meaning of Section 147(c)(3) of the Code.
6. Commercial, Recreation and Parking Facilities. The Borrower represents, warrants,
covenants and agrees that:
(a) The Project has been designed and will be renovated, rehabilitated, improved, constructed
and equipped to include no Commercial Facilities.
(b) The Recreation Facilities are intended and shall be available for use solely by tenants of
the Project and their guests. Such use shall be included in the rent charged to each tenant, and no additional
fees or charges may be assessed.
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