14-20 Cedar Glen Bond Ordinance Addendums

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liable to indemnify any person for any settlement of any aforementioned action effected without the consent of the indemnifying party. The indemnities contained herein shall survive the Closing under this Agreement and any investigation made by or on behalf of the Purchaser or any person who controls any of such parties of any matters described in or related to the transactions contemplated hereby and by the Bond Ordinance and any Loan Documents. ARTICLE III. APPLICATION OF BOND PROCEEDS Section 3.1 Deposit of Funds. In accordance with Article IV hereof, on the Issue Date, MBI shall deposit the initial Principal Advance of the purchase price for the Bonds with the , which shall be an amount in excess of$50,000. MBI shall deposit$0.00 of the initial Principal Advance into the Costs of Issuance Account of the Construction Fund and $ of the initial Principal Advance into the Construction Account of the Construction Fund for the Project. Thereafter, as the Borrower makes requests for disbursements to pay Costs of Construction from the Construction Account of the Construction Fund, upon approval of each request for disbursement from the Borrower, MBI shall, subject to the terms and conditions in this Agreement,make additional Principal Advances in amounts and at such times as are required to fully fund the Costs of Construction, up to the maximum total Principal Advance amount for the Project, and MBI shall deposit said funds into the Construction Account. MBI has no duty to confirm that the requirements for each Principal Advance have been satisfied. Upon receipt of each Principal Advance MBI shall make a notation on its books and records of such Principal Advance. The books and records of MBI shall be determinative of the amounts so advanced. Throughout the term of the Bonds, all Principal Advances of Bond proceeds shall be allocated for tracing purposes to the Cost of Issuance Account of the Construction Fund or the Construction Account of the Construction Fund. Notwithstanding anything else in this Agreement or the Loan Documents, the proceeds of the Bonds shall be used exclusively to pay costs that (i) are (A) capital expenditures (as defined in Section 1.150-1(a) of the Code's regulations) and (B) not made for the acquisition of existing property, to the extent prohibited in Section 147(d) of the Code, and(ii) are made exclusively with respect to a "qualified residential rental project" within the meaning of Section 142(d) of the Code and that for the greatest number of buildings the proceeds of the Bonds shall be deemed allocated on a pro rata basis to each building in the Project and the land on which it is located so that each building and the land on which it is located will have been financed fifty percent (50%) or more by the proceeds of the Bonds for the purpose of complying with Section 42(h)(4)(B) of the Code; provided, however, the foregoing representation, covenant and warranty is made for the benefit of the Borrower and its partners and neither MBI nor the Issuer shall have any obligation to enforce this covenant nor shall they incur any liability to any person, including without limitation, the Borrower, the partners of the Borrower, any other affiliate of the Borrower or the holders of the Bonds for any failure to meet the intent expressed in the foregoing representation, covenant and warranty; and provided further, failure to comply with this representation, covenant and warranty shall not constitute a default or Event of Default under this Agreement. Page 18