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�01106264
<br />Scenario II
<br />Year 15 Year 21
<br />Event Initial Sale Subsequent Sale
<br />Qualified Tenant's Number 4 10
<br />of Years of Occupancy
<br />Initial Sale Fair Market Value $80,000 $80,000
<br />Initial Sale Price $50,000 $50,000
<br />Subsequent Sale Price N/A $95,000
<br />Crown Equity $80,000-$50,000 = $30,000 $30,000
<br />Appreciation Equity $0 $95,000-$80,000 = $15,000
<br />Amount of Crown Equity ($80,OOU-$50,000) _ $30,OOQ ($80,000-$50,000) _ $30,000
<br />Allocable to Qualified Tenant X 4/10 =$12,000 X 10/10 =$30,000
<br />Amount of Crown Equity $30,000-$12,000 = $18,000 $30,000-$3Q,000 = $0
<br />Allocable to Authority
<br />Total of Crown Equity and $12,000+$0 =$12,Q00 $30,000+$15,000 =$45,000
<br />Appreciation Equity
<br />Allocable to Qualified Tenant
<br />Section 8. Internal Revenue Service Notification. In the event the Authority discovers
<br />any noncompliance of any provisions hereof, the Authority will immediately give written notice
<br />to the Owner. The Owner shall have 60 da.ys from the date of such notice (the "Correction
<br />Period"} to correct such noncompliance. Following the Correction Period, the Authority will file
<br />with the IRS a copy of IRS Form 8823, explaining the nature of the noncompliance and whether
<br />or not such noncompliance has been corrected. Noncompliance includes, but is not limited to
<br />(a} failure to receive or failure to permit the Authority to inspect tenant income certifications,
<br />supporting dacumentation and rent records, (b) upon inspection, non-compliance with provisions
<br />of Section 42 of the Code, and (c) any change in the applicable fracrion or eligible basis that
<br />would result in a decrease in the Qualified Basis. The Authority is authorized and entitled to do
<br />all acts necessary to comply with the monitoring and notification responsibilities set forth in
<br />Section 42(m){1}(B)(iii) of the Code and any Regulations or other interpretations thereof by the
<br />IlZS or the courts.
<br />Section 9. Covenants Run With the Project Site. The Owner hereby declares its
<br />express intent that the covenants, restrictions, charges and easements set farth herein sha11 be
<br />deemed covenants running with the Project Site and shall pass to and be binding upon the
<br />Owner's successors in title including any purchaser, grantee, owner or lessee of any portion of
<br />the Project and any other person or entity having any right, ritle or interest therein and upon the
<br />respective heirs, executors, administrators, devisees, successors and assigns of any purchaser,
<br />grantee, owner or lessee of any portion af the Project and any other person or entity having any
<br />4840-0052-9929.t 14
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