07 120312 SA HA WASHINGTON Pl BLA - Attach 3

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(c) Borrower shall remain a "limited dividend entity" and an "eligible owner" for the purposes of Section 236 of the National Housing Act. (d) Borrower shall provide to Lender copies of all notices received pursuant to the IRP Agreement and IRP Use Agreement immediately upon receipt. ARTICLE VI NEGATIVE COVENANTS Borrower hereby covenants and agrees as follows, which covenants shall remain in effect so long as any Payment Obligation or other obligation of Borrower under any of the other Borrower Loan Documents or the Funding Loan Documents remains outstanding or unperformed. Borrower covenants and agrees that it will not, directly or indirectly: Section 6.1. Management Agreement. Without first obtaining the Funding Lender's prior Written Consent, enter into the Management Agreement, and thereafter the Borrower shall not, without the Funding Lender's prior Written Consent (which consent shall not be unreasonably withheld) and subject to the Regulatory Agreement: (i) surrender, terminate or cancel the Management Agreement or otherwise replace the Manager or enter into any other management agreement; (ii) reduce or consent to the reduction of the term of the Management Agreement; (iii) increase or consent to the increase of the amount of any charges under the Management Agreement; (iv) otherwise modify, change, supplement, alter or amend in any material respect, or waive or release in any material respect any of its rights and remedies under, the Management Agreement; or (v) suffer or permit the occurrence and continuance of a default beyond any applicable cure period under the Management Agreement {or any successor management agreement) if such default permits the Manager to terminate the Management Agreement (or such successor management agreement); provided, however, that Funding Lender's prior Written Consent shall not be required for any extension or renewal of the Management Agreement on the same terms and conditions. Section 6.2. Dissolution. Dissolve or liquidate, in whole or in part, merge with or consolidate into another Person. Section 6.3. Change in Business or Operation of Property. Enter into any line of business other than the ownership and operation of the Project, or make any material change in the scope or nature of its business objectives, purposes or operations, or undertake or participate in activities other than the continuance ` of its present business and activities incidental or related thereto or otherwise cease to operate the Project as amulti-family property or terminate such business for any reason whatsoever (other than temporary cessation in connection with construction or rehabilitation, as appropriate, of the Project). Section 6.4. Debt Cancellation. Cancel or otherwise forgive or release any claim or debt owed to the Borrower by a Person, except for adequate consideration or in the ordinary course of the Borrower's business in its reasonable judgment. Section 6.5. Assets. Purchase or own any real property or personal property incidental thereto other than the Project. C:1Users\tadlDesktoplSanta Ana HA Washington Place $2 BLA.doc DRAFT 11/28112 8:41AM