West Orange Township_Fourth Round HEFSP_Final Draft

Additionally, the Owner will deposit an amount as agreed upon between the Borrower and the Agency tor the Project as a reserve for repairs and replacement of items at the Project and initial project costs, excluding social service and/or operating costs. Additionally. the repair and replacement reserve will be funded quarterly by the Borrower with an amount cqual to three (3} months repair and replacement reserve as shown on the Project's Form 10. This reserve will be separate from the Special Needs Project fiscrow and will be known as the Repair and Replacement Reserve. All reserve and escrow payments required pursuant to this Section shall be held in accounts under the sole control of the Agency and shall be paid out for the benefit of the Project as needed on request of the Owner or on the Agency’s own initiative. Any mterest which may be eamed on such reserves shall remain in the escrow account and shal! be used for similar purposes unless the Owner and Agency motually agree to apply the funds to some other Project purpose. Ifthe Agency determines that the payments specified herein are msufficient to ensure prompt payment of taxes. payments in lieu of taxes, insurance premiums. or to properly fund painting, decorating. repair and replacement needs with respect to the Project, then the Agency may require an increase in the minimum required escrow amounts necessary to assure proper funding. Section 22. Inspection of Premises. The Owner covenants and agrees to permit the Agency, its agents or representatives, to inspcet the Project at any and al! reasonable times with or without notice, pursuant to the provisions of the Act and the Program, Section 23. Books and Records. The Owner covenants and agrees to maintain adequate bgoks and records of its transactions, ineluding the social services provided to the Project's residents, with respect to the Project in the Owner's standard form. Such backs and records shall be available for inspection and audit by the Agency or its agents at any time during business hours, with notice, pursuant fo the provisions of the Act and the Program. The Owner further covenants and agrees to cause the financial affairs with respect to the Project to be audited by independent certified public accountants and shall furnish the Agency with its audit report of such accountants as may from time to time be required by the

with respect to the Project to be audited by independent certified public accountants and shall furnish the Agency with its audit report of such accountants as may from time to time be required by the Agency. The Ownérshali ftrnish to the Agency such other information and reports respecting the Project as may from time to time be required by the Agency. \ N Section 24. Management Contract. The Owner may, and if the Agency sv clects, shall contract for the services of a firm experienced in real estate management to act as the managing agent for the Project. The selection of any such managing agent, the scope of the agent's duties and the basis of the agent's compensation shall be the subject of a consultation between the Agency and the Owner and any contract for the employment of any managing agent shall provide that such contract may be terminated by the Agency at any time by notice of such determination by the Agency given to the Owner and managing agent. Section 25. Prohibited Actions, Except with the express approval of the Agency, which approval shall not be unreasonably withheld, the Owner shall not with Project Revenues (as detined 1m Section 20 hereof), Loan disbursements or grant advances: ir)