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FUNDING LOAN AGREEMENT
<br />This Funding Loan Agreement, dated as of December 1, 2012 (this "Funding Loan Agreement"),
<br />is entered into by CITIBANK, N.A., (together with any successor hereunder, the "Funding Lender"),
<br />Housing Authority of the City of Santa Ana, a public body corporate and politic, organized and existing
<br />under the laws of the State of California (together with its successors and assigns, the "Governmental
<br />Lender") and Wilmington Trust, National Association, a national banking association organized and
<br />existing under the laws of the United States of America, as fiscal agent (the "Fiscal Agent").
<br />RECITALS
<br />WHEREAS, pursuant to Chapter 1 of Part 2 of Division 24 of the California Health and Safety
<br />Code, as now in effect and as it may be supplemented from time to time (the "Act"), the Governmental
<br />Lender is authorized: (a} to make loans to any person to provide financing for rental residential
<br />developments located within the jurisdiction of the Governmental Lender and intended to be occupied in
<br />part by persons of low and very low income; (b) to incur indebtedness for the purpose of obtaining
<br />moneys to make such loans and provide such financing, to establish any required reserve funds and to pay
<br />administrative costs and other costs incurred in connection with the incurrence of such indebtedness of
<br />the Governmental Lender; and (c) to pledge all or any part of the revenues, receipts or resources of the
<br />Governmental Lender, including the revenues and receipts to be received by the Governmental Lender
<br />from or in connection with such loans, and to mortgage, pledge or grant security interests in such loans or
<br />other property of the Governmental Lender in order to secure the payment of the principal of, prepayment
<br />premium, if any, on and interest on such indebtedness of the Governmental Lender; and
<br />WHEREAS, Washington Place Partners, LP, a California limited partnership, (the "Borrower"),
<br />has requested the Governmental Lender to enter into this Funding Loan Agreement under which the
<br />Funding Lender (i) will advance funds (the "Funding Loan") to or for the account of the Governmental
<br />Lender, and (ii) apply the proceeds of the Funding Loan to make two loans (collectively, the "Borrower
<br />Loan") to the Borrower to finance the acquisition, rehabilitation, development and equipping of a 200-
<br />unitmultifamily rental housing development located in the City of Santa Ana, California, to be known as
<br />Flower Terrace (the "Project"); and
<br />WHEREAS, simultaneously with the delivery of this Funding Loan Agreement, the
<br />Governmental Lender and the Borrower will enter into a Borrower Loan Agreement of even date
<br />herewith (as it may be supplemented or amended, the "Borrower Loan Agreement"), whereby the
<br />Borrower agrees to make loan payments to the Governmental Lender in an amount which, when added to
<br />other funds available under this Funding Loan Agreement, will be sufficient to enable the Governmental
<br />Lender to repay the Funding Loan and to pay all costs and expenses related thereto when due; and
<br />WHEREAS, to evidence its payment obligations under the Borrower Loan Agreement, the
<br />Borrower will execute and deliver to the Governmental Lender its Borrower Real Estate Note and its
<br />Borrower IRP Note as defined in the Borrower Loan Agreement (each a "Borrower Note" and
<br />collectively; the "Borrower Notes"1 and the obligations of the Borrower l.~nder the Borrower Notes will he
<br />secured by a lien on and security interest in the Project pursuant to a Multifamily Deed of Trust,
<br />Assignment of Rents, Security Agreement and Fixture Filing of even date herewith (the "Security
<br />Instrument"), made by the Borrower in favor of the Governmental Lender, as assigned to the Funding
<br />Lender to secure the performance by the Governmental Lender of its obligations under the Funding Loan;
<br />and
<br />WHEREAS, the Governmental Lender has executed and delivered to the Funding Lender its
<br />1Vlultifamily Housing Revenue Real Estate Note (the "Governmental Lender Real Estate Note") and its
<br />C:\UsersltadlDesktoplSanta Ana HA Washington Place
<br />FLA.doc
<br />DRAFT 11/28/12 8:39AM
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