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Regulatory Restrictions
Regulatory Agreement. The Regulatory Agreement imposes certain requirements with respect to
the tax-exempt status of the Bonds under the Code, which include, among other things, that the Project be
operated as a qualified residential rental project with at least 40% of the completed units in the Project
occupied by Low Income Tenants, i.e., tenants whose income does not exceed 60% of AMI, adjusted for
family size, during the Qualified Project Period (as such term is defined in the Regulatory Agreement) in
accordance with Section 142(d) of the Code. Failure to comply with these requirements could result in the
loss of the federal tax exemption of the Bonds retroactive to their date of issuance.
Tax Credit Extended Use Agreement. In addition, in connection with the Federal Tax Credits
allocated to the Borrower in connection with the Project, the Borrower will execute a Tax Credit Extended
Use Agreement in accordance with Section 42 of the Code. The Tax Credit Extended Use Agreement will,
among other things, require that the Borrower lease approximately 100% of the units as follows: (i) 24 of
the units in the Project to tenants whose household incomes do not exceed 40% of AMI; (ii) 103 of the units
in the Project to tenants whose household incomes do not exceed 50% of AMI; and (iii) 112 of the units in
the Project to tenants whose household incomes do not exceed 60% of AMI.
GRRP Use Agreement. In connection with the GRRP Loan awarded to the Borrower via the GRRP
Program through HUD, the Borrower will execute a GRRP Use Agreement further restricting the
affordability of the Project until August 28, 2049 *, requiring that 100% of units be reserved exclusively for
Low-Income Families (as defined therein), and restricting rents for such units to 30% of 80% of applicable
AMI.
THE BONDS
General
The Bonds will be dated, will be payable in the amounts and on the dates, will bear interest
(computed on the basis of a 360-day year) at the rate, and will mature as described on the cover page. The
Bonds will be issued as fully registered bonds in book-entry form and book-entry interests in the Bonds
will be available for purchase in principal amounts of $5,000 or any integral multiple of $1,000 in excess
thereof.
The Trustee, in its capacity as Registrar, will keep all books and records necessary for registration,
exchange and transfer of the Bonds.
Discussion of the Bonds being issued only under the Book-Entry System is provided below. Details
regarding the procedures for and manner of payment, issuance, exchange and transfer of the Bonds if ever
issued in certificated form as provided in the Bond proceedings are also stated below.
Book-Entry System
The information in this section concerning DTC and DTC’s book-entry system has been obtained
from sources that the Borrower believes to be reliable, but the Borrower takes no responsibility for the
accuracy thereof.
The Depository Trust Company, Brooklyn, New York (“DTC”), will act as securities depository
for the Bonds. The Bonds will be initially issued and issuable only as one fully registered Bond certificate
* Preliminary; subject to change.
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