BOSTON CAPITAL TAX CREDIT FUND IV L.P.
_______________________________________
CERTIFICATION AND AGREEMENT
for
ESCHER SRO PROJECT, L.P.
_______________________________________
CERTIFICATION AND AGREEMENT made as of September __, 1997 by
▇▇▇▇▇▇ ▇▇▇ PROJECT, L.P., a Massachusetts limited partnership
(the "Operating Partnership"); Balanced Housing Development
Corp., as General Partner (the "General Partner") for the benefit
of BOSTON CAPITAL TAX CREDIT FUND IV L.P. (Series 26), a Delaware
limited partnership (the "Investment Partner"), BCTC 94, INC., a
Delaware corporation (the "Special Limited Partner") and
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇ and certain other persons or entities
described herein. The Investment Partner and the Special Limited
Partner shall hereinafter be referred to as the "Limited
Partners."
WHEREAS, the Operating Partnership proposes to admit the
Limited Partners as members thereof pursuant to a Restated
Agreement and Certificate of Limited Partnership of the Operating
partnership and proposed to confirm the Limited Partners, the
withdrawal of the Initial Limited Partner and amend the terms of
the Operating Partnership pursuant to the Amended and Restated
Partnership Agreement of Limited Partnership of the Operating
Partnership dated as of September __, 1997 (the "Partnership
Agreement"), in accordance with which the Special Limited Partner
will make a capital contribution of $10 to the Operating
Partnership and the Investment Partner will make certain capital
contributions to the Operating Partnership.
WHEREAS, the Limited Partners have relied upon certain
information and representations described herein in evaluating
the merits of investment by the Limited Partners in the Operating
Partnership;
WHEREAS, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇, as counsel for the
Limited Partners will rely upon such information and
representations in connection with its delivery of certain
opinions with respect to this transaction; and
WHEREAS, ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ & Gladstone, A Professional Corporation , as counsel for
the Operating Partnership and the General Partner, will rely on
such information and representations in connection with its
delivery of certain opinions with respect to this transaction.
NOW, THEREFORE, to induce the Limited Partners to enter into
the Partnership Agreement and confirm their interest in the
Operating Partnership and for $1.00 and other good and valuable
consideration, the receipt and adequacy of which are hereby
acknowledged, the Operating Partnership and the General Partner
hereby agree as follows for the benefit of the Limited Partners
and ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇ and certain other persons
hereinafter described.
1. Representations, Warranties and Covenants of the Operating
Partnership and the General Partners.
The Operating Partnership and the General Partner jointly
and severally represent, warrant and certify to the Limited
Partners and ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇ that, with respect to the
Operating Partnership, as of the date hereof:
1.01 The Operating Partnership is duly organized and in good
standing as a limited partnership pursuant to the laws of the
state of its formation with full power and authority to own
Escher Street SRO (the "Project") and conduct its business; the
Operating Partnership and the General Partner have the power and
authority to enter into and perform this Certification and
Agreement; the execution and delivery of this Certification and
Agreement by the Operating Partnership or the General Partner has
been duly and validly authorized by all necessary action; the
execution and delivery of this Certification and Agreement, the
fulfillment of its terms and consummation of the transactions
contemplated hereunder do not and will not conflict with or
result in a violation, breach or termination of or constitute a
default under (or would not result in such a conflict, violation,
breach, termination or default with the giving of notice or
passage of time or both) any other agreement, indenture or
instrument by which the Operating Partnership or the General
Partner is bound or any law, regulation, judgment, decree or
order applicable to the Operating Partnership, the General
Partner any of their respective properties; this Certification
and Agreement constitutes the valid and binding agreement of the
Operating Partnership and the General Partner enforceable against
each of them in accordance with its terms.
1.02 All factual information, including without limitation
the information set forth in Exhibit A hereto, provided to the
Limited Partners or their affiliates either in writing or orally,
did not, at the time given, and does not, on the date hereof,
contain any untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the
circumstances under which they are made. The General Partner has
also delivered to the Limited Partners or their affiliates all
documents and other information which has been requested by such
parties. Since the date of the financial statements for the
General Partner previously delivered, there has been no material
adverse change in the financial position of said General Partner.
The estimates of occupancy rates, operating expenses and tax
credits set forth on Exhibit A are reasonable in light of the
knowledge and experience of the General Partner.
1.03 As of the date hereof, each of the representations
contained in Exhibit B attached hereto is true, accurate and
complete as to each of the Operating Partnership, the General
Partner and as to any of their affiliates, any of their
predecessors and their affiliates' predecessors, any of their
directors, officers, general partners and/or beneficial owners of
ten per cent (10%) or more of any class of their equity
securities (beneficial ownership meaning the power to vote or
direct the vote and/or the power to dispose or direct the
disposition of such securities), as the case may be, and any
promoters presently connected with them in any capacity.
1.04 Each of the representations and warranties contained in
the Partnership Agreement is true and correct as of the date
hereof.
1.05 Each of the covenants and agreements of the Operating
Partnership and the General Partner contained in the Partnership
Agreement has been duly performed to the extent that performance
of any covenant or agreement is required on or prior to the date
hereof.
1.06 All conditions to admission of the Limited Partners as
members of the Operating Partnership contained in the Partnership
Agreement have been satisfied.
1.07 No default has occurred and is continuing under the
Partnership Agreement or any of the Project Documents (as such
term is defined in the Partnership Agreement) for the Operating
Partnership.
1.08 The General Partner agrees to take all actions
necessary to claim the Projected Credit, including, without
limitation, satisfying the conditions to the Carryover Allocation
Agreement with the Agency dated as of December 5, 1995 (the
"Carryover Allocation Agreement"), placing the Project in service
no later than December 31, 1997, filing of Forms 8609 with the
Internal Revenue Service, incurring the requisite threshold
amount of rehabilitation expenses consisting of the greater of
(i) $3,000 per unit or (ii) 10% of the adjusted basis in the
project as of the first day of the twenty-four month period
ending or projected to end on December 31, 1997 and providing to
Boston Capital an accountant's certification as to items (i) and
(ii) herein.
1.09 No person or entity other than the Operating
Partnership holds any equity interest in the Project.
1.10 The Operating Partnership has the sole responsibility
to pay all maintenance and operating costs, including all taxes
levied and all insurance costs, attributable to the Project.
1.11 The Operating Partnership, except to the extent it is
protected by insurance and excluding any risk borne by lenders,
bears the sole risk of loss if the Project is destroyed or
condemned or there is a diminution in the value of the Project.
1.12 No person or entity except the Operating Partnership
has the right to any proceeds, after payment of all indebtedness,
from the sale, refinancing, or leasing of the Project.
1.13 The General Partner is not related in any manner to the
Limited Partners, nor is the General Partner acting as an agent
of the Limited Partners.
1.14 To the best of the undersigned's current knowledge
after due inquiry, and except as expressly disclosed to the
Limited Partners of which the Limited Partners have actual
knowledge, the Project does not contain in a level above that
deemed safe by all applicable governmental agencies, any
substance known to be hazardous, such as hazardous waste, lead-
based paint, asbestos, methane gas, urea formaldehyde insulation,
oil, toxic substances, underground storage tanks, polychlorinated
biphenals (PCBs), and radon; the Project is not affected by the
presence of oil, toxic substances, or other pollutants that could
be a detriment to the Project except for those conditions
expressly disclosed to the Limited Partners and of which the
Limited Partners have actual knowledge nor is the Operating
Partnership in violation of any local, state, or federal law or
regulation; and no violation of the Clean Air Act, Clean Water
Act, Resource Conservation and Recovery Act, Toxic Substance
Control Act, Safe Drinking Water Control Act, Comprehensive
Environmental Resource Compensation and Liability Act, or
Occupational Safety and Health Act has occurred or is continuing.
Neither the Operating Partnership nor the General Partner has
received any notice from any source whatsoever of the existence
of any such hazardous condition relating to the Project or of any
violation of any local, state or federal law or regulation with
respect to the Project except for those notices expressly
disclosed to the Limited Partners of which the Limited Partners
have actual knowledge.
1.15 At the time of completion of rehabilitation of the
Project, the Project will not contain in a level above that
deemed safe by all applicable governmental agencies, any
substance known to be hazardous, such as hazardous waste, lead-
based paint, asbestos, methane gas, urea formaldehyde insulation,
oil, toxic substances, underground storage tanks, polychlorinated
biphenals (PCBs), and radon; the Project is not affected by the
presence of oil, toxic substances, or other pollutants that could
be a detriment to the Project nor will the Operating Partnership
in violation of any local, state, or federal law or regulation;
and no violation of the Clean Air Act, Clean Water Act, Resource
Conservation and Recovery Act, Toxic Substance Control Act, Safe
Drinking Water Control Act, Comprehensive Environmental Resource
Compensation and Liability Act, or Occupational Safety and Health
Act shall be present or continuing. Neither the Operating
Partnership nor the General Partner shall be in receipt of any
notice from any source whatsoever of the existence of any such
hazardous condition relating to the Project or of any violation
of any local, state or federal law or regulation with respect to
the Project which such hazardous condition or violation has not
been cured.
1.16 To the best of the undersigned's belief, based on the
undersigned's current knowledge of property values in the area
where the Project is located, and based upon the level of
permanent debt financing for the Project reflect in Exhibit A,
and that certain Appraisal of the Project prepared by National
Westminster Bank, NJ dated as of February 27, 1996, the fair
market value of the Operating Partnership's building(s) as of the
closing date, taking into account value attributable to a
reservation of low income housing tax credits and/or below market
financing, as well as the use restrictions imposed on the
Project, will be greater than the total amount of the Operating
Partnership's liabilities, including accrued interest on such
liabilities as of the Closing Date.
1.17 The General Partner of the Operating Partnership is not
a tax-exempt entity.
1.18 If any shareholder or other affiliate of the General
Partner is a tax-exempt entity and the General Partner is a
"controlled entity" in relation to such tax-exempt entity, a
timely election will be made under Code Section 168(h)(6)(F) so
that no portion of the Project will be treated as "tax exempt use
property" as defined in Code Section 168(h).
1.19 All representations made by the General Partner in the
Partnership Agreement are incorporated herein by reference and
are confirmed.
1.20 There is a reasonable expectation that the Operating
Partnership will be able to repay, as due, the principal and
interest on the projected loans to the Operating Partnership
based on the projected value of the Operating Partnership's
property and building(s) and the projection of income and
expenses reflected in the pro-forma attached as Exhibit A-1.
1.21 An Extended Use Commitment (as defined in the
Partnership Agreement) within the meaning of Code Section
42(h)(6) will be in effect with respect to the building(s) not
later than the end of the taxable year in which any credit is
taken with respect to any building.
1.22 As of December 5, 1995, the date of the Carryover
Allocation Agreement, and as of the date hereof, the Project was
and is located in a qualified census tract which qualifies the
Project for the 130% basis boost pursuant to Code Section 42.
The Project meets all other requirements for satisfying the 130%
basis boost, and any HOME funding being loaned to the Partnership
bears interest at no less than the "applicable federal rate" so
that it does not meet the definition of a "below market federal
loan" under Code Section 42 and will therefore not prohibit the
Partnership from taking advantage of the 130% basis boost.
1.23 The amounts payable in development and property
management fees to Balanced Housing Development Corp. and Emet
Property Management Company, respectively, are fair in light of
the value and magnitude of the services rendered in consideration
for such fees, and the services performed in consideration for
the development fees relate solely to the acquisition or
construction of the Project.
1.24 For any building(s) not placed in service prior to
December 31, 1995, (i) the Operating Partnership's basis in such
building (including its respective lot) as of the close of 1995
was at least 10% of the Operating Partnership's reasonably
expected basis in such building as of the close of calendar year
1997 and (ii) the Operating Partnership entered into a Carryover
Allocation Agreement with the Agency dated as of December 5,
1995.
1.25 The Operating Partnership shall elect to defer the
start of the Credit Period pursuant to Code Section 42(f) until
1998 and include in eligible basis those additional
rehabilitation expenses incurred in the first year of the Credit
Period.
1.26 Each of the representations made by the General Partner
in the Conditional Reservation of Low Income Housing Tax Credits
between the Agency and the Operating Partnership dated as of June
26, 1995 (the "Credit Reservation Agreement") and the Carryover
Allocation Agreement is true and correct as of the date hereof.
1.27 Each of the covenants, agreements, and conditions
contained in the Credit Reservation Agreement and the Carryover
Allocation Agreement has been duly performed or satisfied by the
Operating Partnership or its General Partner, as applicable, to
the extent that performance of any such covenant or agreement or
satisfaction of any condition is required on or prior to the date
hereof, and the General Partner has no reason to believe that the
covenants, agreements, and conditions of such Credit Reservation
Agreement and the Carryover Agreement required to be performed or
satisfied after the date hereof will not be performed or
satisfied in a timely manner.
1.28 The General Partner has not received from the Agency
any notice of default or of withdrawal or cancellation of the Tax
Credit reservation or allocation to the Operating Partnership as
described in the Credit Reservation Agreement and the Carryover
Allocation Agreement.
1.29 The General Partner will undertake any and all actions
necessary under the Code and the regulations promulgated
thereunder, including any future amendments to such regulations,
to ensure that the Partnership will be classified as a
partnership for federal income tax purposes. The General Partner
will file or cause to be filed any elections that may be required
(but only if required) under the Code and the regulations
promulgated thereunder, including any future amendments to such
regulations, in order to ensure that the Partnership will be
classified as a partnership for federal income tax purposes. The
General Partner will not change its classification status or
election without the consent of BCTC 94, Inc.
1.30 The General Partner and any entity that is related to
such General Partner, or to the Operating Partnership and that
receives a fee from the Operating Partnership, directly or
indirectly, is on the cash-basis method of accounting for tax
purposes.
1.31 Balanced Housing Development Corp. is the developer of
the Project pursuant to the Development Agreement by and between
the Operating Partnership and Balanced Housing Development Corp.
dated as of September __, 1997 (the "Development Agreement"),
and is on a cash-basis method of accounting for tax purposes.
1.32 The General Partner will be actively involved in the
management and operation of the Operating Partnership, will
devote substantial and continuing attention to the activities of
the Operating Partnership, and will provide substantial services
to the Operating Partnership.
1.33 The development and leasing activity in which the
Operating Partnership will engage will not contain any material
personal or recreational benefit for the members of the Operating
Partnership.
1.34 The Operating Partnership will keep active records and
carry out the proposed activity in a manner consistent with
profitable businesses in the same activity.
1.35 The Operating Partnership will have an objective to
carry on business for profit and divide the gains therefrom.
1.36 The Operating Partnership may earn a profit, including
profit from appreciation in the value of the Project.
1.37 The Mortgage Loans and all other debt financing of the
Project requires the noncontingent repayment of principal on or
before a fixed maturity date, and will be considered and treated
as a loans by ▇▇▇▇▇▇▇.
1.38 None of the Operating Partnership's Lenders is a party
from whom the Operating Partnership acquired any portion of the
Project, and none of the financing was issued in exchange for any
portion of the Project. None of the Operating Partnership's
Lenders will receive a fee with respect to the Operating
Partnership's investment in the Apartment.
1.39 Following is a description of any and all existing or
proposed financing of the Project that involves any direct or
indirect grant or federal subsidy (including without limitation
federal grants, below-market interest rate loans, and tax-exempt
bonds):
a) $419,956.00 loan from Balanced Housing Development
Corp. at the applicable federal rate of interest.
Proceeds of this loan were received by Balanced
Housing as a grant from Sovereign Bank, F.S.B. under
the Federal Home Loan Bank Board AHP Program.
b) $1,590,000 loan from the City of Trenton accruing
interest at nine percent (9%) per annum with a pay
rate of 7.5% per annum. Loan made available under
Section 108 program.
1.40 The Project will not receive moderate rehabilitation
assistance under Section 8(e)(2) of the United States Housing Act
of 1937 other than that pursuant to the ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Homeless Assistance Act of 1988.
1.41 If the Project is a scattered site project within the
meaning of Code Section 42, 100% of the rental units in the
Project will be rent-restricted within the meaning of Code
Section 42.
1.42 The projects consists of 104 units, of which 100 are
SRO, or single room occupancy residential rental Units; the
remaining Units are for use by the Project superintendent, the
manager and the maintenance staff, and therefore considered a
facility reasonably required by the Project. All residential
rental Units in the Project are to be of equal quality and all
Project amenities are to be made available to all tenants on a
comparable basis without separate fees.
2. Indemnification
2.01 The General Partner (for purposes of this Section 2.01,
an "Indemnifying Party") agrees to indemnify and hold harmless
the Limited Partners (for purposes of this Section 2.01, the
"Indemnified Parties" or, individually, an "Indemnified Party")
and each officer, director, employee and person, if any, who
controls any Indemnified Party against and from any and all
claims, suits, actions, debts, damages, costs, charges, losses,
obligations, judgments, and expenses, of any nature whatsoever,
suffered or incurred by the Investment Partner, under or on
account of the Hazardous Waste Laws or any similar laws or
regulations, including the assertion of any lien thereunder,
except for claims, suits, actions, debts, damages, costs,
charges, losses, obligations, judgments, or expenses arising from
the Investment Partner's own negligence, misconduct or fraud.
For purposes of this Certification and Agreement, "Hazardous
Substances" means oil, petroleum or chemical liquids or solids,
liquid or gaseous products or any hazardous wastes or hazardous
substances, as those terms are used in the Hazardous Waste Laws;
and "Hazardous Waste Laws" means the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, and any other
federal, state or local law governing Hazardous Substances, as
such laws may be amended from time to time.
This indemnity agreement shall remain in full force and
effect notwithstanding any investigation made by any party
hereto, shall survive the termination of any agreement which
refers to this indemnity and shall be in addition to any
liability which the Indemnifying Party may otherwise have.
2.02 No Indemnifying Party shall be liable under the
indemnity agreements contained in Section 2.01 herein unless the
Indemnified Party shall have notified the Indemnifying Party in
writing within forty-five (45) business days after the summons or
other first legal process giving information of the nature of the
claim shall have been served upon the Indemnified Party or any
such of its officers, directors, employees or controlling
persons, but failure to notify an Indemnifying Party of any such
claim shall not relieve it from any liability which it may have
to the Indemnified Party or any such of its officers, directors,
employees or controlling persons against whom action is brought
otherwise than on account of its indemnity agreement contained in
Section 2.01 herein. In case any action is brought against any
Indemnified Party or any such of its officers, directors,
employees or controlling persons upon any such claim, and it
notifies the Indemnifying Party of the commencement thereof as
aforesaid, the Indemnifying Party shall be entitled to
participate at its own expense in the defense, or, if it so
elects, in accordance with arrangements satisfactory to any other
Indemnifying Party or parties similarly notified, to assume the
defense thereof, with counsel who shall be reasonably
satisfactory to such Indemnified Party or any such of its
officers, directors, employees or controlling persons and any
other Indemnified Parties who are defendants in such action; and
after notice from the Indemnifying Party to such Indemnified
Party or any such of its officers, directors, employees or
controlling persons of its election so to assume the defense
thereof and the retaining of such counsel by the Indemnifying
Party, the Indemnifying Party shall not be liable to such
Indemnified Party or any such of its officers, directors,
employees or controlling persons for any legal or other expenses
subsequently incurred by such Indemnified Party or any such of
its officers, directors, employees or controlling persons in
connection with the defense thereof.
3. Miscellaneous
3.01 This Certification and Agreement is made solely for the
benefit of the Operating Partnership, the General Partner,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇ and the Limited Partners (and, to the
extent provided in Section 2, the officers, directors, partners,
employees and controlling persons referred to therein), and their
respective successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement.
3.02 This Certification and Agreement may be executed in
several counterparts, each of which shall be deemed to be an
original, all of which together shall constitute one and the same
instrument.
3.03 Terms defined in the Partnership Agreement but not
otherwise defined herein shall have the meanings given them in
the Partnership Agreement.
IN WITNESS WHEREOF, the undersigned have set their hands and
seals as of the date first above written.
Operating Partnership:
ESCHER SRO PROJECT, L.P.
By: Balanced Housing Development
Corp.,
its general partner
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: President
EXHIBIT A
ESCHER SRO PROJECT, L.P.
FACT SHEET
1. Projected Sources and Uses of Funds
Sources of Funds
Perm. City Mort. Loan - BBOC 1,590,000.00
Balanced Housing Development Corp. 419,956.00
Boston Capital Loan 263,170.00
Boarding House Grant 399,791.00
Additional City Loan (conditional loan) 100,000.00
Deferred Development Fee Obligation 328,225.00
Capital Contributions:
General Partner 100.00
Investment Partner 3,748,125.00
$6,849,367.00
Application of Funds
Total Construction Cost 3,044,590.00
Architectural Fees 131,178.00
Survey & Permits/Engineering 83,410.00
Land Cost or Value 525,000.00
Interest During Construction 500,000.00
Loan Fees & Costs 32,875.00
Legal/Accounting 235,968.00
Marketing/Rent Up/Start Up 45,000.00
Construction and Soft Costs Contingency 100,000.00
Constr. Insurance 167,989.00
Tax Credit Fees 72,505.00
Environmental Consultant & Clearance 36,401.00
Operating Reserve 200,000.00
Development Fee 964,774.00
Boston Capital Loan 263,170.00
Title Insurance 20,933.00
Real Estate Taxes 94,671.00
Appraisal Fees 4,850.00
Site Security 11,696.00
$6,849,367.00
2. Construction/Permanent Financing
(i) First Mortgage
▇. ▇▇▇▇▇▇: The City of Trenton ("City")
B. Mortgage Amount: $1,590,000.00
C. Note Date: _______ ___, 1997
D. Interest Rate: 9%
E. Term: 198 months
(ii) Second Loan
▇. ▇▇▇▇▇▇: Balanced Housing Development Corp.
B. Loan Amount: $419,956.00
C. Note Date: May 31, 1995
D. Interest Rate: Applicable Federal Rule
E. Term: 360 months
3 Eligible Basis: $5,724,370.00
4. Qualified Basis: $7,441,681.00
5. General Partner Capital Contribution: $100
6. Type of Credit: Rehabilitation
7. Rent-up Schedule:
100% by April 30, 1998 100 units
8. Projected Credit to the Investment Partner (99.99%):
A. $446,160.00 for 1998
B. $594,880.00 per annum for each of the years 1999
through 2007
C. $148,720.00 for 2008
9. Tax Credit Approval:
A. Application:
1. Date: ___________, 1995
2. Credit Amount Requested: $595,000 (annual)
B. Credit Reservation (Conditional)
1. Date: June 26, 1995
2. Credit Amount Reserved: $594,940.00 (annual)
▇. ▇▇▇▇▇▇▇▇▇ Allocation:
1. Date: December 5, 1995
2. Credit Amount Allocated: $594,940.00
D. Credit Rate Lock-in Agreement
1. Date: Executed November 29, 1995, dated as of
December 5, 1995
2. Rate locked-in: 8.48%
E. Form 8609
1. Date: Post Construction
2. Credit Amount Allocated:
10. Project:
A. Name: Escher Street SRO
B. Address: ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇: ▇▇▇▇▇▇
D. Type of Project: One Hundred-Four (104) Units Total
with One Hundred (100) efficiency-type single-room-
occupancy (SRO) units
11. 199__ _____________ Metropolitan Area (▇▇▇▇▇▇ County) Median
Income: $__________
12. Type of Apartments: Singe Room Occupancy
Unit Utility Total
Number Square Ft. Basic Rent Allowance Monthly Rent
Single Room 100 Approx.___ $472.00 $0 $472.00
13. Difference between rents allowed by FMHA and rents allowed
under the Rent Restriction Test: ____________________
14. Rental Assistance: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Homeless Assistance
Act of 1988
15. Annual Operating Expenses: $361,262.00 (1999 first full
year)
16. Replacement Reserve Account: $150/unit = $15,000.00
17. Operating Reserve Account: $200,000.00
18. Amount of Annual Asset Management Fee to Boston Capital
Communications Limited Partnership: $7,500.00
19. Amount of Annual Incentive Partnership Management Fee:
$7,500.00
20. Amount of Total Depreciable Basis Allocated to Personal
Property: $4,527,066.00
21. Completion Date: December 31, 1997
22. Total Capital Contribution of Investment Partner:
$3,748,125.00
23. Schedule of Capital Contributions:
A. $1,992,618.00 on latest to occur of:
(i) Tax Credit Set Aside,
(ii) Initial Closing,
(iii) Receipt by Boston Capital of acceptable commitment
from City regarding City Loan restructure,
(iv) Admission Date, or
(v) Receipt by Boston Capital of acceptable commitment
for title insurance
B. $805,507.00 on the latest to occur of:
(i) 75% Completion Date,
(ii) Receipt of updated title insurance policy,
(v) Compliance with due diligence recommendations,
(vi) Receipt of payoff letter from contractor,
(vii) Receipt of estoppel letter from lender, or
(viii) Satisfaction of all prior conditions.
C. $400,000.00 on latest to occur of:
(i) Substantial Completion,
(ii) State Designation,
(iii) Cost Certificate,
(iv) Satisfaction of all prior conditions.
D. $220,000.00 on the latest to occur of:
(i) Initial 95% Occupancy Date,
(ii) Final Closing,
(iii) Rental Achievement,
(iv) Satisfaction of all prior conditions.
E. $320,000.00 on the latest to occur:
(i) Second Rental Achievement,
(ii) Satisfaction of all prior conditions.
F. $10,000.00 on the latest to occur of:
(i) Receipt of tax return and audited financial,
statements for the year in which rental
achievement occurs, and
(ii) Satisfaction of all prior conditions.
24. Fees, Special Distributions and Other Items to be paid from
Capital Contributions
A. Development Fee: $964,774.00 ($328,225.00 of which is
a Deferred Development Fee)
B. Special Return of General Partner Capital N/A
25. Consulting Fee to Boston Capital Partners, Inc. N/A
26. General Partner: Balanced Housing Development Corp.
Address: ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
27. Developer: Balanced Housing Development Corp.
Contact Person: ▇▇▇▇▇▇ ▇▇▇▇▇
Address: ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
28. Ownership Interests
Tax Credit Capital Operating
Allocations Transactions Cash Flow
General Partner: 00.01% 50.00% 80.00%
Investment Partner: 99.99% 50.00% 20.00%
Special Limited
Partner: 0.00% 0.00% 0.00%
29. Management Agent: Fela, Inc., d/b/a Emet Realty Management
and Development Company, Inc.
Contact Person: ▇▇▇▇▇▇ ▇▇▇▇▇
Address: c/o Emet Realty Management and Development
Company, Inc.
P.O. Box 23
Livingston, NJ 07039
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Amount of Fee: 8.5% of Total Operating Revenue with
potential increase to maximum 10% of Total Operating Revenue
30. Builder: Allied Construction Services, II, Inc.
Contact Person: ▇▇▇▇▇ ▇▇▇▇▇▇
Address: ▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Amount of Compensation: Outstanding Contract sum of
$1,925,000.00 subject to additions and deductions as
provided in the Contract Documents
31. Architect: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Architects
Contact Person: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Address: ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Amount of Fee: $124,273.00
32. Auditor: ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ & Co.
Contact Person: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Address: 280 Corporate Center
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-1785
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
33. Tax Return Preparer: ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ & Co.
Contact Person: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Address: 280 Corporate Center
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-1785
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
34. Federal Taxpayer ID Number for Escher SRO Project,
L.P.: 22- 320658
Federal Taxpayer ID Number for Balanced Housing Development
Corp.: ▇▇-▇▇▇▇▇▇▇
35. State Housing Credit Agency: New Jersey Housing and
Mortgage Finance Agency
36. State Housing Agency LIHTC Number: 304
37. Operating Deficit Guaranty The General Partner shall have
an unlimited operating deficit guarantee; additionally the
General Partner shall provide funds as necessary to pay
Operating Deficits; but in the event that such loans are not
made, the Operating Partnership shall utilize amounts
otherwise payable to the Developer as installments of the
Development Fee, as applicable.
38. Guarantor(s): ▇▇▇▇▇▇ ▇▇▇▇▇ guarantees all obligations and
duties of the General Partner as set forth on that certain
Guaranty dated as of the date hereof.
cc: Boston Capital Communications Limited Partnership Accounting
Department
Exhibit B
Certificate of Operating Partnership
and General Partner
Re: Lack of Disqualifications
The Operating Partnership and its General Partner (as identified
on the Amended and Restated Certification and Agreement to which
this Certificate is attached as Exhibit B) hereby represent to
you that none of (i) the Operating Partnership, (ii) any
predecessor of the Operating Partnership, (iii) any of the
Operating Partnership's affiliates ("affiliate" meaning a person
that controls or is controlled by, or is under common control
with, the Operating Partnership), (iv) any sponsor (meaning any
person who (1) is directly or indirectly instrumental in
organizing the Operating Partnership or (2) will directly or
indirectly manage or participate in the management of the
Operating Partnership or (3) will regularly perform, or select
the person or entity who will regularly perform, the primary
activities of the Operating Partnership), (v) any General
Partner, manager, officer, director, principal or general partner
of the Operating Partnership or of any sponsor, (vi) the officer,
director, principal, promoter or general partner of any General
Partner or Manager, (vii) any beneficial owner of ten percent or
more of any class of the equity securities of the Operating
Partnership or of any sponsor (beneficial ownership meaning the
power to vote or direct the vote and/or the power to dispose or
direct the disposition of such securities), (viii) any promoter
of the Operating Partnership(meaning any person who, acting alone
or in conjunction with one or more other persons, directly or
indirectly has taken, is taking or will take the initiative in
founding and organizing the business of the Operating Partnership
or any person who, in connection with the founding and organizing
of the business or enterprise of the Operating Partnership,
directly or indirectly receives in consideration of services or
property, or both services and property, ten percent or more of
any class of securities of the Operating Partnership or ten
percent or more of the proceeds from the sale of any class of
such securities; provided, however, a person who receives such
securities or proceeds either solely as underwriting commissions
or solely in consideration of property shall not be deemed a
promoter if such person does not otherwise take part in founding
and organizing the enterprise) presently connected with the
Operating Partnership in any capacity:
(1) Has filed a registration statement which is the subject of
any pending proceeding or examination under the securities laws
of any jurisdiction, or which is the subject of any refusal order
or stop order thereunder entered within five years prior to the
date hereof;
(2) Has been convicted of or pleaded nolo contendere to a
misdemeanor or felony or, within the last ten years, been held
liable in a civil action by final judgment of a court based upon
conduct showing moral turpitude in connection with the offer,
purchase or sale of any security, franchise or commodity (which
term, for the purposes of this Certificate shall hereinafter
include commodity futures contracts) or any other aspect of the
securities or commodities business, or involving racketeering,
the making of a false filing or a violation of Sections 1341,
1342 or 1343 of Title 18 of the United States Code or arising out
of the conduct of the business of an issuer, underwriter, broker,
dealer, municipal securities dealer, or investment adviser, or
involving theft, conversion, misappropriation, fraud, breach of
fiduciary duty, deceit or intentional wrongdoing including, but
not limited to, forgery, embezzlement, obtaining money under
false pretenses, larceny fraudulent conversion or
misappropriation of property or conspiracy to defraud, or which
is a crime involving moral turpitude, or within the last five
years of a misdemeanor or felony which is a criminal violation of
statutes designed to protect consumers against unlawful practices
involving insurance, securities, commodities, real estate,
franchises, business opportunities, consumer goods or other goods
and services;
(3) Is subject to (a) any administrative order, judgment or
decree entered within five years prior to the date hereof entered
or issued by or procured from a state securities commission or
administrator, the Securities and Exchange Commission ("SEC"),
the Commodities Futures Trading Commission or the U.S. Postal
Service, or to (b) any administrative order or judgment, arising
out of the conduct of the business of an underwriter, broker,
dealer, municipal securities dealer, or investment adviser, or
involving deceit, theft, fraud or fraudulent conduct, or breach
of fiduciary duty, or which is based upon a state banking,
insurance, real estate or securities law or (c) has been the
subject of any administrative order, judgment or decree in any
state in which fraud, deceit, or intentional wrongdoing,
including, but not limited to, making untrue statements of
material fact or omitting to state material facts, was found;
(4) Is subject to any pending proceeding in any jurisdiction
relating to the exemption from registration of any security or
offering, or to any order, judgment or decree in which
registration violations were found or which prohibits, denies or
revokes the use of any exemption from registration in connection
with the offer, purchase or sale of securities, or to an SEC
censure or other order based on a finding of false filing;
(5) Is subject to any order, judgment or decree of any court or
regulatory authority of competent jurisdiction entered within
five years prior to the date hereof, temporarily, preliminarily
or permanently restraining or enjoining such persons from
engaging in or continuing any conduct or practice in connection
with any aspect of the securities or commodities business or
involving the making of any false filing or arising out of the
conduct of the business of an underwriter, broker, dealer,
municipal securities dealer, or investment adviser, or which
restrains or en joins such person from activities subject to
federal or state statutes designed to protect consumers against
unlawful or deceptive practices involving insurance, banking,
commodities, real estate, franchises, business opportunities,
consumer goods and services, or is subject to a United States
Postal Service false representation order entered within five
years prior to the date hereof, or is subject to a temporary
restraining order or preliminary injunction with respect to
conduct alleged to have violated Section 3005 of Title 39, United
States Code;
(6) Is suspended or expelled from membership in, or suspended or
barred from association with a member of, an exchange registered
as a national securities exchange, an association registered as a
national securities association, or any self-regulatory
organization registered pursuant to the Securities Exchange Act
of 1934, or a Canadian securities exchange, or association or
self-regulatory organization operating under the authority of the
Commodity Futures Trading Commission, or is subject to any
currently effective order or order entered within the past five
years of the SEC, the Commodity Futures Trading Commission or any
state securities administrator denying registration to, or
revoking or suspending the registration of, such person as a
broker-dealer, agent, futures commission merchant, commodity pool
operator, commodity trading adviser or investment adviser or
associated person of any of the foregoing, or prohibiting the
transaction of business as a broker-dealer or agent;
(7) Has, in any application for registration or in any report
required to be filed with, or in any proceeding before the SEC or
any state securities commission or any regulatory authority
willfully made or caused to be made any statement which was at
the time and in the light of the circumstances under which it was
made false or misleading with respect to any material fact, or
has willfully omitted to state in any such application, report or
proceeding any material fact which is required to be stated
therein or necessary in order to make the statements made,
in the light of the circumstances under which they are made, not
misleading, or has willfully failed to make any required
amendment to or supplement to such an application, report or
statement in a timely manner;
(8) Has willfully violated any provision of the Securities Act
of 1933, the Securities Exchange Act of 1934, the Trust Indenture
Act of 1939, the Investment Advisers Act of 1940, the Investment
Operating Partnership Act of 1940, the Commodity Exchange Act of
1974 or the securities laws of any state, or any predecessor law,
or of any rule or regulation under any of such statutes;
(9) Has willfully aided, abetted, counseled, commanded, induced
or procured the violation by any other person of any of the
statutes or rules or regulations referred to in subsection (8)
hereof;
(10) Has failed reasonably to supervise his agents, if he is a
broker-dealer, or his employees, if he is an investment adviser,
but no person shall be deemed to have failed in such supervision
if there have been established procedures, and a system for
applying such procedures, which would reasonably be expected to
prevent and detect, insofar as practicable, any violation of
statutes, rules or orders described in subsection (8) and if such
person has reasonably discharged the duties and obligations
incumbent upon him by reason of such procedures and system
without reasonable cause to believe that such procedures and
system were not being complied with;
(11) Is subject to a currently effective state administrative
order or judgment procured by a state securities administrator
within five years prior to the date hereof or is subject to a
currently effective United States Postal Service fraud order or
has engaged in dishonest or unethical practices in the securities
business or has taken unfair advantage of a customer or is the
subject of sanctions imposed by any state or federal securities
agency or self-regulatory agency;
(12) Is insolvent, either in the sense that his liabilities
exceed his assets or in the sense that he cannot meet his
obligations as they mature, or is in such financial condition
that he cannot continue his business with safety to his
customers, or has not sufficient financial responsibility to
carry out the obligations incident to his operations or has been
adjudged a bankrupt or made a general assignment for the benefit
of creditors; or
(13) Is selling or has sold, or is offering or has offered for
sale, in any state securities through any unregistered agent
required to be registered under the New Jersey Securities Law, as
amended (the "New Jersey Act") or for any broker-dealer or issuer
with knowledge that such broker- dealer or issuer had not or has
not complied with the New Jersey Act. If the Operating
Partnership is subject to the requirements of Section 12, 14 or
15(d) of the Securities Exchange Act of 1934, then the Operating
Partnership has filed all reports required by those Sections to
be filed during the 12 calendar months preceding the date hereof
(or for such shorter period that the Operating Partnership was
required to file such reports).
