Affordable Housing Regulatory Agreement

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consistent with the intent of and in accordance with this Section_ 7, and to provide such evidence thereof as City may reasonably request. Notwithstanding the foregoing, the City agrees that the City will not withhold consent to reasonable requests for subordination of this Agreement to deeds of trust provided for the benefit of lenders providing financing for the acquisition or rehabilitation, or permanent financing of the Project in accordance with a financing plan approved by City, provided that the instruments effecting such subordination include reasonable protections to the City in the event of default, including without limitation, extended notice and cure rights. 8. Transfer and Encumbrance. 8.1 Restrictions on Transfer and Encumbrance. During the term of this Agreement, Owner shall not directly or indirectly, voluntarily, involuntarily or by operation of law make or attempt any total or partial sale, transfer, conveyance, assignment or lease (collectively, "Transfer") of the whole or any part of the Property, the Project, or the improvements located on the Property, without the prior written consent of the City, which approval shall not be unreasonably withheld. In addition, prior to the expiration of the term of this Agreement, Owner shall not undergo any significant change of ownership without the prior written approval of City. For purposes of this Agreement, a "significant change of ownership" shall mean a transfer of the beneficial interest of more than twenty-five percent (25%) in aggregate of the present ownership and /or control of Owner, taking all transfers into account on a cumulative basis; provided however, neither the admission of an investor limited partner, nor the transfer by the investor limited partner to subsequent limited partners shall be restricted by this provision. 8.2 Transfers. Subject to Section 8.4 below, the prohibitions on Transfer set forth herein shall not be deemed to prevent: (i) the granting of easements or permits to facilitate operation of the Project; (ii) the lease of individual dwelling units to tenants for occupancy as their principal residence in accordance with this Agreement; (iii) assignments creating security interests for the purpose of financing the acquisition, rehabilitation, or permanent financing of the Project or the Property in accordance with a financing plan approved by City, or Transfers directly resulting from the foreclosure of, or granting of a deed in lieu of foreclosure of, such a security interest; (iv) a Transfer to a tax-exempt entity under the direct control of or under common control with HHDC; (v) a Transfer to a limited partnership in which HHDC or a wholly -controlled a tax-exempt affiliate of HHDC is the managing general partner ("Approved Partnership"); (vi) the admission of limited partners and any transfer of limited partnership interests in accordance with Owner's, or the Approved Partnership's, as applicable, agreement of limited partnership (the "Partnership Agreement"); (vii) the removal of the general partner by the investor limited partner for cause in accordance with the terms of the Partnership Agreement, provided that the replacement general partner is an entity reasonably satisfactory to City or is an affiliate of the investor limited partner that will serve as general partner for an interim period of no more than 180 days during which time a permanent replacement general partner satisfactory to the City shall be identified and admitted; or (viii) the transfer of the general partner's interest to a nonprofit entity that is tax-exempt under Section 501(c)(3) of the Internal Revenue Code of 1986 as amended (or to an entity wholly-owned thereby), provided such replacement general partner is reasonably satisfactory to City. REV: 02-25-2020 PR ATTY/AGR.2020.039/Premia 1180 Main Owner, LLC (Page 29 of 42)