West Orange Township_Fourth Round HEFSP_Final Draft

ate defined as hazardous, toxic. pollutant, infectious, flammable or radioactive by any of the Environmental Laws, and, whether or not included in such lists, shall be deemed to include ail products or substanves containmg petroleum, asbestos, lead, and polychlorinated biphenyls. "HUD" means the United States Department of Housing and Urban Development. “Improvements” means the building together with all fixtures and utility improvements, easements and rights of way that are owned by the Owner and located on the Land. “IRS Reguiations” means the regulations promulgated or proposed by the United States Department of the Treasury or the Internal Revenue Service pursuant to the Code, and to the extent applicable, pursuant to the intemal Revenue Code of 1954, as both may be amended from time to time, including all rules, rulings, policies, and official statements issued by the Unted States Department of the Treasury or the Internal Revenue Service. "Land" means the real property descnbed in Exhibit A attached hereto, on which the Project is located. “Loan Documents” nicans and includes this Agreement, the Mortgage Note, the Mortgage and Sccunty Agreement, the GCC-1 Financing Statement, and Assignment of Leases. “Loan” means the Mortgage Loan or Second Mortgage Loan *Low Income” means a gross annual houschold income equal to 50% or less of the median gross annual household income for the same size within the relevant housing region. S So. “Mortgage” or "Second Mortgage” means the mortgage of even date herewith that constitutes a second lien of a fee. simple interest in the Project and Jand, given by the Owner to the Agency to secure the Mortgage Loan. "Mortgage Loan" or "Second Mortgage Loan” means the loan made to the Owner by the Agency to finance a portion of the cost of the development and/or rehabilitation of the Project that will be located on the real property described in Exhibit A attached hereto, as evidenced by the Mortgage Note and secured by the Mortgage. “Mortgage Note" or "Note" or "Second Mortgage Note" means the interest bearing non- recourse promissory note that contains the promise of the Owner to pay the sum of money stated therein at the times stated therein and that evidences the obligation of the Owner to repay the Mortgage Loan. “Permitted Encembrances” means any q) Utihty, access and other easements and rights of way,

rein at the times stated therein and that evidences the obligation of the Owner to repay the Mortgage Loan. “Permitted Encembrances” means any q) Utihty, access and other easements and rights of way, restrictions and exceptions that do not, individually or in the aggregate, materially impair the utility or value of the Project or Land for the purposes for which it is intended:

(ii). Liens that are being contested in good faith and for which the Owner has provided security satisfactory to the Agency: (ti) Liens subordinate to the Mortgage Loan arising duc to any monies loaned in connection with the Project or other monies loaned to the Owner, provided such liens are disclosed to and approved by the Agency in writing; and (iv) Any other encumbrances approved by the Agency in writing. “Plans” means all construction, Architect's and design contracts and all Architect's design plans and specifications. “Program” means the Special Needs Housing Trust Fund pursuant to the Special Needs Housing Trast Fund Act. P.L. 2005, ¢.163. "Program Guidelines" means the guidclines promulgated by the Agency pursuant to the Program and any policies or procedures issued by the Agency with respect to the housing projects financed by the Agency, all of the foregoing as they may be amended from time to time. “Project™ means the Improvements located on the Land that together with the Land is financed, in part, with the proceeds of the Loan. “Project Construction Period” means the period of time required to substantially complete construction of the Project, The Project Construction Period is estimated to be three (3) months from the date of execution of this Agreement. “Regulations means the regulations promulgated or proposed by the United States Department of Housing and Urban Development. "Rehabilitation Period” means the pertod of time as required to substantially complete the rehabilitation of the Project, The Project Rehabilitation Period is estimated to be three (3) months from the date of execution of this Agreement, if applicable, "Repair and Replacement Reserve" means the cscrow account established pursuant to Scction 21 of this Agreement. "Servicing Fee" if applicable, means the servicing tee that is duc from the Owner to the Agency as set forth in the Mortgage Note. “Special Needs Project Escrow" means the escrow account established pursuant ta Section 21 of this Agreement. "State" means the State of New Jersey. "Tax Credits” means lew income housing tax credits that the Project may receive pursuant to the Code. aa

"Fhird Mortgage Loan" means the loan in the principal amount of $77.787 of even date herewith, made to the Owner by the Agency from the New Jerscy Community Housing Program that constitutes a valid third lien on the Project and Land. "UCC-1" means the UCC-1 Financing Statement(s} of even date herewith. Unless the context clearly requires otherwise, as used in this Agreement, words of the masculine, feminine or neuter gender shall be construed to include any other gender when appropriate and words of the smgular number shall be construed to include the plural number. and vice-versa, when appropriate. This Agreement and all the terms and provisions thercof shail be construed to effectuate the purposes sei forth herein and to sustain the validity hereof. The titles and headings of the sections of this Agreement have been inserted for convenience of reference only, and are not to be considered a part hereof and shal} not in any way modify or restrict any of the terms or provisions hereof or be considered or given any effect in construing this Agicement or any provisions hereof or in ascertaining intent, if any question of intent shall arisc. Section 2, Background and Purpose. The Owner proposes to acquire or owns the Land. construct. and opcrate a Project to be located on the Land. The Project will carry a construction and permanent loan of Two Hundred Thirty-Nine Thousand Nine Hundred Twenty-Two Doliars ($239,922) at an interest rate of zero percent per annum during the mortgage term of thirty (30) years. To obtain financing for the Project, the Owner has applied to the Agency for the Agency Financing pursuant to the provisions of the Program. The Agency will hold a second mortgage lien on the Project during the term of the Mortgage Loan. Financing tor the Project is derived in part irom the Agency's Program funds, and, in addition to the Second Mortgage Loan, the Owner has obtained and the Agency has approved funding for the Project as follows: (a} The Agency is providing a Third Mortgage Loan to the project in the principal amount of $77,787 of even datc herewith: and {b) The Owner received a loan from the County of Essex trom their HOME Program in the amount of $270,213. In connection with the Mortgage, the Owner and the Agency have cntered into this Agreement. in connection with its application for the Loan, the Owner has furnished to the

in the amount of $270,213. In connection with the Mortgage, the Owner and the Agency have cntered into this Agreement. in connection with its application for the Loan, the Owner has furnished to the Agency various details as to the Project. including the description of Land on which itis to be situated, plans and specifications for the construction/rehabilitation of the Project, the tenant population that shall be housed in the Project. the number of units of cach type to be included therein, the estimated costs of providing the Project. details as to the Project income and expenses of the Project once constructed and/or rehabilitated and placed in operation and arrangements for any tax abatement for the Project.

Section 3, -Residential Rental Property. The Owner hereby represents, covenants. warrants and agrees that: (a) The proposed project is located in the Township of West Orange in the County of Essex, in a residential neighborhood. The project invelves the acquisition and renovation of a three- bedroom condominium home. {b) The Project is to be utilized at all times in accordance with the types of use as permitted by the Act and the Program and as may be approved by the Agency. The Project shall be subject to use and occupancy and/or lease agreements between the Owner and the residents. Section 4, Low Income Tenants. The Owner hercby represents, warrants and covenants that ail of the units shall be occupied or available for occupancy by Low Income Tenants for a period of thirty (30) years from the date hereof. Section 5. Additional Representations, Covenants and Warranties of the Owner. The Owner represents. warranls and covenants that: (a) The Owner (1) is a non-profit corporation, duly organized. validiy existing and in good standing under the laws of the State and duly authorized to transact business in the State; (1) has filed with the Agency a true and complete copy of its Certificate of Incorporation with all amendments, if any, thereto; (iit) has the power and authority to own or lease its properties and assets, including the Project and the Land, and w carry on its business as now being conducted (and as now contemplated), and to borrow the proceeds of the Loans: and (iii) has the power to execute and perfonn all the undertakings of this Agreement and the other Loan Documents. (b) All necessary legal action has been taken te authorize the execution, delivery and performance of the Loan Documents by the Owner. (c) The Loan Documents have been duly executed and delivered by the Owner and constitute the valid and legally binding obligations of the Owner, enforceable against the Owner tn accordance with their respective terms, {d} To the best of the Owner's knowledge after due and diligent inquiry, the execution and performance of this Agreement, the Loan Documents and other instruments required pursuant to this Agreement by the Owner, (i) will not violate or, as applicable, have not violated, any provision of law, rule or regulations, any order of any court or other agency or government or any provision of any document to which the Owner is a

t violate or, as applicable, have not violated, any provision of law, rule or regulations, any order of any court or other agency or government or any provision of any document to which the Owner is a party, and (ii) will not violate or, as applicable, have not violated, any provision of any indenture, agreement or other instrument to which the Owner is a party, or resuit in the creation or imposition of any lien, charge or encumbrance of any nature other than the Permitted Encumbrances. {c) The Owner will, at the time of execution of this Agreement or at the time of the closing of the Loan and subject only to such exceptions as have been discloscd in waiting to the Agency and which will not materially interfere with or impact the beneticial use of the Project and Land for purposes of the Project: have good and marketable title to fee simple interest in the premises 7

constituting the Land and the Project tree and clear of any lien or encumbrance (subject to Permitted Encumbrances and encumbrances created or contemplated pursuant to this Agreement). {f) There is, after due and diligent inquiry, no action, suit or proceeding al law or in equity or by or before any governmental instrumentality or other agency now pending, or. threatened against or affecting it, or any of its properties or rights, which. if adversely determined. would materially impair its right to carry on business substantially as now conducted, or as contemplated to be conducted under this Agreement, or would materially adversely affect its financial condition. (g) To the best of the Owner's knowledge after due and diligent inquiry, the operation of the Project in the manner presently contemplated and as described in this Agreement will not conflict with any zoning, water or air pollution or other ordinance, order, law or regulation applicable thereto. The Owner has caused the Project to be designed in accordance with all applicable federal, state and local laws or ordinances (including rules. and regulations) relating to zoning, building, safety and environmental quality and will proceed with due diligence to rehabilitate the Project pursuant to the Architect's Contract. Further, the Owner has received or shall obtain all necessary governmental approvals and building permits for construction, rehabilitation and operation of the Project in accordance with the plans and specifications and the Architect's Contract, and shall obtain in a timely manner any and all required extensions of governmental approvals, iticluding. but not limited to, site plan approval. ‘The Owner will continue to retain ownership of the Project and Land during the term of the Mortgage, subject to the terms of this Agreement and the other Loan Documents, the Act, Agency Regulations, the Program, the Program Guidelines, and, if applicable, the Code. PN, {h) The Owner has tiled, caused to be filed by it, or shall file all federal, state and local tax retumis which are requived ta be filed by it, if any, and has paid ar caused to be paid all taxes as shown on said return or on any assessment received by tt, to the extent that such taxes have became dug. , 2 (1) To the best of the Owner's knowledge, atter due and diligent inquiry, the Owner is not in material default in the

any assessment received by tt, to the extent that such taxes have became dug. , 2 (1) To the best of the Owner's knowledge, atter due and diligent inquiry, the Owner is not in material default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained én any material agreement or instrument to which it is a party that may materially atfect this, Project. <.. (j) The itfommation contaimed in the Project description provided in the applications for the Loan is accurate in ail material respects and does not contain any untrue staternents of a material fact or omit to state a material fact necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading. {k) Except for Leases contemplated by the Project and Section i7 of this Agreement, the Owner shall not during the term of this Agreement sell, transfer or exchange, the Project or the Land (or any part thercof or any interest therein) at any time except in accordance with the terms of the Mortgage, this Agreement, the Act and the Agency Regulations promulgated pursuant to the Act, and the Program Guidelines and unless such sale, transfer or exchange shall have been approved by the Agency. The Owner shall notify in waiting and obtain the agreement in writing of any buyer or successor or other person acquiring the Project or Land or any interest therein, in a form acceptable g

to the Agency that such acquisition is subject to the requirements of this Agreement. This provision shal} not act to waive any other restriction on such sale, transfer or exchange. () The Owner has not and will not execute any other agreement with provisions contradictory to, or in opposition to, the provisions hercof and the Mortgage, and in any event, the requirements of this Agreement and the Mortgage are paramount and controlling as to the nights and obligations herein and in the Mortgage and such requirements shalt supersede any other requirements in conflict herewith and therewith, {m) All statements contained in all applications, correspondence or other materials delivered to the Agency by the Owner in connection with its consideration of the Loan to the Owner or relating to the Project are materially true and correct {n) The representations, covenants and warrantics of the Owner contained in this Agreement on the date of its execution are true and shail continue to be true at all times during the term of this Agreement. fo) No event has occurred and no condition exists which constitutes an Event of Default under this Agreement or the Mortgage or which, but for a requirement of notice or lapse of time, or both. would constitute such an Event of Default. (p) As of the date of this Agreement, the Architect's Contract is in full force and effect and no default has occurred thereunder, and a true copy of the entire Architect’s Contract with all modifications and addenda to date has been filed with the Agency. Section 6. Covenants to Rug With the Land. The covenants, reservations and restrictions set lorth herein shall be deemed covenants running with the Land and, except as provided in Section 5 hereof, shall pass to and be binding upon the Owner's assigns and successors in title to the Land or the Project; provided, however, that upon the termination of this Agreement in accordance with the terms hercof said covenants, reservations and restrictions shall expire. Each and every contract, deed or other instrument hereafter executed covering of conveying the Land or the Project or any portion thercof shall conclusively be held to have been executed, delivered and accepted subject to such covenants, reservations and testrictions regardless of whether such covenants, reservations and restrictions are set forth in such contract, decd or other