Louisiana Local Government Environmental Facilities and Community Development Authority Multifamily Housing Revenue Bonds (The Cove at Nola Apartments) Series 2017A

This Preliminary Official Statement and information contained herein are subject to completion, amendment or other change without notice. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell or the solicitation of any offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, qualification or filing under the applicable securities laws of such jurisdiction. herein undertheheading“TaxMatters.” imposed bytheStateandanyparish,municipalityorotherpoliticalsubdivisionofLouisiana,allsubjecttoqualificationsdescribed alternative minimumtaximposedonindividualsandcorporations,(iii)interesttheSeries2017Bondsisexemptfromallpresenttaxes ontheTax-ExemptBondswillnotbeaspecificitemoftaxpreferenceforpurposesfederal purposes offederalincometaxationand(ii) interest 2017A BondsandtheSeries2017B(collectively,“Tax-exempt”)willbeexcludiblefromgrossincomeofholdersthereoffor * Preliminary, subjecttochange Date: ______, 2017 NEW ISSUE-BookEntryOnly Appendices, mustbereadtomakean informedinvestmentdecision. Louisiana. Itisexpectedthatdelivery oftheBondswillbemadeagainstpaymentthereforthroughfacilities ofDTConoraboutApril11,2017. local counselSherGardnerCahillRichter Klein&HilbertL.L.C.,NewOrleans,Louisiana;andfortheUnderwriter byFoley&Judell,L.L.P.,NewOrleans, Joseph Delafield,LakeCharles,Louisiana; fortheBorrowerandSoleMemberbyBrennan,Manna& Diamond, LLC,Jacksonville,Floridaandbytheir the approvaloflegalitybyButlerSnowLLP,BatonRouge,Louisiana,Bond Counsel.CertainlegalmatterswillbepasseduponfortheIssuerbyitscounsel Defaults andRemedies”inAppendixChereto. ARE OUTSTANDING.See“RISKFACTORSANDIN PRINCIPAL ORINTERESTONTHESUBORDINATEBONDSWILLNOT CONSTITUTEANEVENTOFDEFAULTASLONGTHESENIORBONDS AND TO THE EXTENT DESCRIBED HEREIN. SEE “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS” HEREIN. A FAILURE TO PAY of ProjectRevenues(asdefinedintheIndenture).THESUBORDINATE BONDSARESUBORDINATETOTHESENIORINMANNER Agreement”) betweentheAuthorityandBorrower.TheLoanissecured bytheMortgage(asdefinedherein),whichincludesapledge funds depositedundertheIndenture,includingpaymentsmadeby BorrowerpursuanttotheLoanAgreementdatedasofApril1,2017(the“ FINANCIAL CONDITIONANDTHERISKSIN ANY APPROPRIATIONFORTHEIRPAYMENT.THEAUTHORITYHASNOTAXINGPOWER. INDIRECTLY OR CONTINGENTLY OBLIGATE THE STATE OR ANY GO PRO OR LIABILITYOFTHESTATEANYGO FROM THETRUSTESTATE(OTHERTHANRESER Bonds andtheSubordinateinDebtServiceReserveFund(iii)paycertaincostsofissuanceBonds. existing 300-unitmultifamilyresidentialrentalhousingfacilitylocatedinNewOrleans,Louisiana(the“Project”),(ii)fundseparateaccountsfortheSenior Section 501(c)(3)oftheInternalRevenueCode1986,asamended,to(i)financeaportioncostacquisition,rehabilitationandequipping ofan is InvestinAmerica’sVeteransFoundation,Inc.(the“SoleMember”),aFloridanonprofitcorporationrecognizedasanexemptorganizationpursuantto Trustee. TheproceedsoftheBondswillbeloanedto2016AVHGCove,LLC,aLouisianalimitedliabilitycompany(the“Borrower”),whosesolemember of andinterestonsuchBond.TheBondsaresubjecttoredemptionpriormaturityasmorefullydescribedherein. beneficial ownerofaBondmustmaintainanaccountwithbrokerordealerwhois,actsthrough,DTCParticipanttoreceivepayment the principal System” herein.Principalof,andinterestontheBondswillbepaidbyTrusteedirectlytoDTC,asregisteredownerthereof.Anypurchaser as a be entitledtoreceivecertificatesrepresentingtheirBondsforsolongastheglobalbook-entrysystemisineffect.See“THEBONDS-BookEntry-Only book-entry formonlyunderaglobalsystemoperatedbyTheDepositoryTrustCompany,NewYork,York(“DTC”),andpurchaserswillnot The Bondsarebeingissuedonlyasfullyregisteredbondsinthedenominationsof$5,000eachandintegralmultiplesthereof.will be issuedin provisions ofChapter10-DTitle33theLouisianaRevisedStatutes1950,asamended(La.R.S.33:4548.1through4548.16,inclusive) (the “Act”). each year,commencingJune1,2017.TheAuthorityisapoliticalsubdivisionoftheStateLouisiana(the“”)andorganizedexistingunder of WilmingtonTrust,NationalAssociation,asTrustee(the“”),inDallas,Texas.InterestontheBondsispayableJune1andDecember the Series2017ABonds,“Bonds”). Theprincipalofandpremium,ifany,interestontheBondsarepayableatdesignatedcorporatetrustoffice Revenue Bonds(TheCoveatNOLAApartments),SubordinateSeries2017B(the“”ortheandtogetherwith Multifamily HousingRevenueBonds(TheCoveatNOLAApartments),Series2017A(the“”)andits$2,335,000* and “SUMMARIESOFCERTAINPRO FACTORS ANDIN V In theopinionofButlerSnowLLP,BondCounsel,underexistinglaws,regulations,rulingsandjudicialdecisions,(i)interestonSeries This coverpagecontainslimitedinformation forreferenceonly.Itisnotasummaryoftheissue. The entireOfficialStatement,including the The Bondsareofferedwhen,as,andifissuedbytheIssuer,subjecttoprior sale,withdrawalormodificationoftheofferwithoutnoticeandsubjectto The BondswillbesecuredbyapledgeandassignmentoftheTrust Estate (asdefinedherein),includingcertainrevenuesfromtheProjectand IN THE BONDSANDINTERESTTHEREONARESPECIAL,LIMITEDOBLIGATIONSOFAUTHORITYPAYABLESOLELY The BondsarebeingissuedpursuanttoandsecuredbyaTrustIndenturedatedasofApril1,2017(the“”)betweentheAuthority The LouisianaLocalGovernmentEnvironmentalFacilitiesandCommunityDevelopmentAuthority(the“”)isissuingits$16,750,000* IDED FORINTHEINDENTUREANDLOANAGREEMENT.ISSUANCEOFBONDSSHALLNOT,DIRECTLY, V ESTMENT INTHEBONDS Maturity Dates,PrincipalAmounts,InterestRates,YieldandCUSIPNumbersShownontheInsideCover L V ESTMENT CONSIDERATIONS”HEREIN. ouisiana PRELIMINARY OFFICIAL STATEMENT DATED THURSDAY, MARCH 30, 2017

and L V ISIONS OFTHEPRINCIPALDOCUMENTS–TheIndenture;Revenue Fund”and“—TheIndenture; ocal MULTIFAMILY HOUSINGRE C V Series 2017A $16,750,000* OL ommunity (THE CO V ES ADEGREEOFRISKANDEACHPROSPECTI V OL G V ERNMENTAL UNITTHEREOFBUTSHALLBEPAYABLESOLELYFROMTHEFUNDS V o V ED TODETERMINETHESUITABILITYOFIN ESTMENT CONSIDERATIONS–SubordinateStatusofSeries 2017BBonds”herein v V ED RIGHTS).THEBONDSSHALLNOTBEDEEMEDTOCONSTITUTEADEBT ernment V E ATNOLAAPARTMENTS) $19,085,000* SERIES 2017 D consisting of: e v elopment V E ERNMENTAL UNIT THEREOF TO LE n v V ironmental ENUE BONDS Series 2017B Subordinate $2,335,000* A RATINGS: S&P:Series2017A“A”(StableOutlook) uthority V E IN V ESTING INTHEBONDS.SEE“RISK Series 2017B“BBB”(StableOutlook) F V acilities ESTOR SHOULDCONSIDERITS V Y ANY TAXES OR TO MAKE See “RATINGS”herein

MATURITIES, PRINCIPAL AMOUNTS, INTEREST RATES, PRICES AND CUSIPS

$16,750,000* LOUISIANA LOCAL GOVERNMENT ENVIRONMENTAL FACILITIES AND COMMUNITY DEVELOPMENT AUTHORITY MULTIFAMILY HOUSING REVENUE BONDS (THE COVE AT NOLA APARTMENTS) SERIES 2017A

Maturity Date Principal Amount Interest Rate Yield CUSIP** 12/01/2027 $2,580,000 12/01/2042 $6,440,000 12/01/2052 $7,730,000

$2,335,000* LOUISIANA LOCAL GOVERNMENT ENVIRONMENTAL FACILITIES AND COMMUNITY DEVELOPMENT AUTHORITY MULTIFAMILY HOUSING REVENUE BONDS (THE COVE AT NOLA APARTMENTS) SUBORDINATE SERIES 2017B

Maturity Date Principal Amount Interest Rate Yield CUSIP** 12/01/2052 $2,335,000

* Preliminary, subject to change

** CUSIP® is a registered trademark of the American Bankers Association. CUSIP numbers have been assigned by an independent company not affiliated with the Authority, the Borrower or the Underwriter and are included solely for the convenience of the holders of the Bonds. None of the Authority, the Borrower or the Underwriter are responsible for the selection or uses of these CUSIP numbers, and no representation is made as to their correctness on the Bonds or as indicated above. The CUSIP number for a specific maturity is subject to being changed after the issuance of the Bonds as a result of various subsequent actions including, but not limited to, a refunding in whole or in part of the Bonds. * Preliminary, subject to change

No dealer, broker, salesman, or other person has been authorized by the Borrower or the Authority to give any information or to make any representation with respect to the Bonds, other than as contained in this Official Statement, and if given or made, such other information or representations must not be relied upon as having been authorized by the Borrower or the Authority. This Official Statement does not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of the Bonds by any person, in any jurisdiction in which it is unlawful for such person to make such offer, solicitation, or sale. The information set forth herein has been obtained from the Borrower and other sources which are believed to be reliable but is not guaranteed as to accuracy or completeness and is not to be construed as a representation by the Borrower or the Authority. The information regarding DTC has been obtained from DTC, but is not guaranteed as to accuracy or completeness by the Borrower. The Underwriter has provided the following sentence for inclusion in this Official Statement: The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale made hereunder shall under any circumstances create any implication that there has been no change in the information or opinions set forth herein after the date of this Official Statement. This Official Statement does not constitute a contract between the Authority, the Borrower or the Underwriter and any one or more of the purchasers or registered Holders of the Bonds.

The Authority has not reviewed or approved, and does not represent or warrant in any way, the accuracy or completeness of any of the information set forth in this Official Statement, including the appendices hereto other than the statements set forth under the captions “INTRODUCTION – The Authority,” “THE AUTHORITY” and “LITIGATION – The Authority.”

CUSIP is a registered trademark of the American Bankers Association. CUSIP data herein is provided by Standard & Poor’s CUSIP Service Bureau, a division of The McGraw-Hill Companies, Inc.

The Bonds have not been registered under the Securities Act of 1933, and the Indenture has not been qualified under the Trust Indenture Act of 1939, in reliance on exemptions contained in such Acts.

THE BONDS HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION. THE REGISTRATION, QUALIFICATION OR EXEMPTION OF THE BONDS IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAW PROVISIONS OF THE JURISDICTIONS IN WHICH THESE SECURITIES HAVE BEEN REGISTERED, QUALIFIED OR EXEMPTED SHOULD NOT BE REGARDED AS A RECOMMENDATION THEREOF. NEITHER THESE JURISDICTIONS NOR ANY OF THEIR AGENCIES HAVE GUARANTEED OR PASSED UPON THE SAFETY OF THE BONDS AS AN INVESTMENT, UPON THE PROBABILITY OF ANY EARNINGS THEREON OR UPON THE ACCURACY OR ADEQUACY OF THIS OFFICIAL STATEMENT.

IN CONNECTION WITH THE OFFERING OF THE BONDS, THE UNDERWRITER MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME, AND IF CONTINUED, MAY BE RECOMMENCED AT ANY TIME.

CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS

This Official Statement contains “forward-looking” information within the meaning of the federal securities laws. Certain statements in this Official Statement that relate to the Project and the Borrower including, but not limited to, statements under the captions “THE BORROWER AND THE PROJECT” and “ESTIMATED SOURCES AND USES OF FUNDS” and “PRO FORMA FINANCIAL PROJECTIONS” attached hereto as Appendix D, are forward-looking statements that are based on the beliefs of, and assumptions made by, the management of the Borrower. The forward-looking information includes statements concerning the Borrower’s outlook for the future, as well as other statements of beliefs, future plans and strategies or anticipated events, and similar expressions concerning matters that are not historical facts. Forward-looking information and statements are subject to many risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, the statements. Such forward-looking statements involve known and unknown risks,

uncertainties and other factors that may cause the actual results or performance of the Project and the Borrower to be materially different from any expected future results or performance. These risks and uncertainties include the availability and amount of governmental reimbursements, appropriations, the competitive environment and related market conditions, operating efficiencies, access to capital, the cost of compliance with environmental and health standards, litigation and other risks and uncertainties described herein under “RISK FACTORS AND INVESTMENT CONSIDERATIONS.” Readers are cautioned not to place undue reliance on forward-looking statements because actual results may differ materially from those expressed in, or implied by, the statements. Any forward-looking statement made in this Official Statement speaks only as of the date of such statement, and the Borrower and the Authority undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH FORWARD-LOOKING STATEMENTS INVOLVES KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. THE BORROWER DOES NOT EXPECT OR INTEND TO ISSUE ANY UPDATES OR REVISIONS TO THOSE FORWARD-LOOKING STATEMENTS IF OR WHEN ITS EXPECTATIONS, OR EVENTS, CONDITIONS OR CIRCUMSTANCES ON WHICH SUCH STATEMENTS ARE BASED OCCUR.

Readers are cautioned not to place undue reliance on forward-looking statements because actual results may differ materially from those expressed in, or implied by, the statements. Any forward-looking statement made in this Official Statement speaks only as of the date of such statement, and the Borrower and the Authority undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

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TABLE OF CONTENTS

Page INTRODUCTION ...... 1 Purpose of this Official Statement ...... 1 The Bonds ...... 1 Description of the Bonds ...... 2 Security and Sources of Payment the Bonds ...... 3 The Authority ...... 4 The Borrower and the Sole Member ...... 5 The Project ...... 5 Property Condition Assessment Report ...... 5 Certain Tax Matters ...... 6 Certain Bondholders’ Risks ...... 6 THE BONDS ...... 7 General Description ...... 7 Subordinate Bonds ...... 7 Transfer and Exchange of the Bonds ...... 8 Book-Entry-Only System ...... 8 Revision of Book-Entry-Only System ...... 10 Mandatory Redemption of Bonds ...... 10 Optional Redemption of Bonds ...... 11 Mandatory Sinking Fund Redemption ...... 11 Selection of Bonds to be Redeemed ...... 12 Notice of Redemption ...... 13 Payment of Redemption Price ...... 13 No Partial Redemption After Event of Default ...... 13 ANNUAL DEBT SERVICE REQUIREMENTS ...... 14 SOURCES AND USES OF FUNDS ...... 15 SECURITY AND SOURCES OF PAYMENT FOR THE BONDS ...... 15 Trust Estate ...... 15 Limited Obligations of Authority ...... 15 Repayment of Loan ...... 16 Mortgage ...... 16 Operation of the Project ...... 16 Rate Covenant ...... 16 Flow of Project Revenues ...... 17 Revenue Fund ...... 18 Debt Service Reserve Fund ...... 19 Repair and Replacement Fund...... 20 Surplus Fund ...... 20 Other Funds ...... 21 No Credit Enhancement Facility ...... 21 Other Covenants of the Borrower ...... 21 Relationship Among Series ...... 21 Issuance of Additional Bonds ...... 22 THE AUTHORITY ...... 22 Organization ...... 22 THE BORROWER AND THE PROJECT ...... 23 The Borrower ...... 23 The Sole Member ...... 23 The Project ...... 25 Surrounding Community ...... 25 Occupancy ...... 26 i

Project Regulation ...... 26 Insurance ...... 27 Prior Operating History ...... 27 The Property Manager ...... 27 The Asset Manager ...... 31 Environmental Assessment ...... 31 Property Condition Assessment Report ...... 32 Pro Forma Financial Projection ...... 32 Limitation on Obligations of the Borrower ...... 32 APPRAISAL ...... 33 RISK FACTORS AND INVESTMENT CONSIDERATIONS ...... 33 Limited Obligations of Authority ...... 34 Limited Repayment Obligations of Borrower; Security for Repayment ...... 34 The Borrower and Related Parties; Conflicts of Interest ...... 34 Future Project Revenues and Expenses ...... 34 Subordinate Status of Series 2017B Bonds ...... 35 Risks of Real Estate Investment ...... 35 Effect of Increases in Operating Expenses ...... 36 Project Risks ...... 37 Reliance on Property Manager ...... 38 Insurance Risks ...... 39 Appraisal ...... 39 Property Condition Assessment Report ...... 40 Financial Projections ...... 40 Acceleration of the Bonds; Limitation ...... 41 Risk of Early Redemption ...... 41 Risk of Loss Upon Redemption ...... 41 Incurrence of Additional Indebtedness ...... 41 Debt Service Reserve Fund ...... 41 Effect of Bankruptcy ...... 41 Enforceability of Remedies; Prior Claims ...... 42 Secondary Market and Prices ...... 43 Credit Ratings ...... 43 Specific Tax Covenants of Borrower and Rental Restrictions ...... 43 State and Local Taxation ...... 43 Taxation of the Bonds ...... 44 Federal Income Tax Matters; 501(c)(3) Status of Borrower ...... 44 Possible Consequence of Tax Compliance Audit ...... 44 Forward-Looking Statements ...... 45 Other Possible Risk Factors ...... 45 Summary ...... 45 LITIGATION ...... 45 The Authority ...... 45 The Borrower ...... 46 APPROVAL OF LEGAL MATTERS ...... 46 TAX MATTERS ...... 46 General Matters ...... 46 Backup Withholding ...... 47 Original Issue Premium ...... 47 Original Issue Discount ...... 48 Changes in Federal and State Tax Law ...... 48 RATINGS ...... 48 UNDERWRITING ...... 49 CONTINUING DISCLOSURE ...... 49 ii

RELATIONSHIPS AMONG PARTIES ...... 49 MISCELLANEOUS ...... 49

APPENDIX A – DEFINITIONS OF CERTAIN TERMS APPENDIX B – SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS APPENDIX C – FORM OF BOND COUNSEL OPINION APPENDIX D – PRO FORMA FINANCIAL PROJECTIONS APPENDIX E – HISTORICAL FINANCIAL STATEMENT APPENDIX F – FORM OF CONTINUING DISCLOSURE AGREEMENT APPENDIX G – APPRAISAL

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OFFICIAL STATEMENT

relating to the original issuance of

$19,085,000* LOUISIANA LOCAL GOVERNMENT ENVIRONMENTAL FACILITIES AND COMMUNITY DEVELOPMENT AUTHORITY MULTIFAMILY HOUSING REVENUE BONDS (THE COVE AT NOLA APARTMENTS) SERIES 2017

consisting of: $16,750,000* $2,335,000* Series 2017A Subordinate Series 2017B

INTRODUCTION

This introduction is not a summary of this Official Statement. It is only a brief description of and guide to, and is qualified by, more complete and detailed information contained in the entire Official Statement, including the cover page and Appendices hereto, and the documents summarized or described herein. A full review should be made of the entire Official Statement. The offering of Bonds to potential investors is made only by means of the entire Official Statement. For the definitions of certain other terms used in this Official Statement and not otherwise defined herein, see “DEFINITIONS OF CERTAIN TERMS” in Appendix A hereto.

Purpose of this Official Statement

This Official Statement, including the cover and inside cover pages and the Appendices hereto, is provided to furnish information in connection with the original issuance by the Louisiana Local Government Environmental Facilities and Community Development Authority (the “Authority”) of its $16,750,000* Multifamily Housing Revenue Bonds (The Cove at NOLA Apartments), Series 2017A (the “Series 2017A Bonds”) and its $2,335,000* Multifamily Housing Revenue Bonds (The Cove at NOLA Apartments), Subordinate Series 2017B (the “Series 2017B Bonds” or the “Subordinate Bonds” and together with the Series 2017A Bonds, the “Bonds”).

The Bonds

Purpose of the Bonds. The Bonds are being issued by the Authority to make a loan to 2016 AVHG Cove, LLC (the “Borrower”), a Louisiana limited liability company, whose sole member is Invest in America’s Veterans Foundation, Inc. (the “Sole Member”), a Florida nonprofit corporation which has been determined to be exempt from income taxation pursuant to Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the “Code”). The loan will be made pursuant to a Loan Agreement dated as of April 1, 2017 (the “Loan Agreement”), between the Authority and the Borrower, and will be used to (i) finance a portion of the cost of acquisition, rehabilitation and equipping of an existing 300-unit multifamily residential rental housing facility located in New Orleans, Louisiana, known as The Cove at NOLA Apartments (the “Project”), (ii) fund separate accounts for the Senior Bonds and the Subordinate Bonds in the Debt Service Reserve Fund and (iii) pay certain costs of issuance of the Bonds. See the caption “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS” and “ESTIMATED SOURCES AND USES OF FUNDS” herein.

______*Preliminary, subject to change

The Bonds. The Bonds are to be issued provisions of Chapter 10-D of Title 33 of the Louisiana Revised Statutes of 1950, as amended (La. R.S. 33:4548.1 through 4548.16, inclusive) (the “Act”), and a Trust Indenture, dated as of April 1, 2017 (the “Indenture”), between the Authority and Wilmington Trust, National Association, Dallas, Texas, as Trustee (the “Trustee”). The Bonds will be issued in the amounts, will be dated, will bear interest at the respective rates and will be payable on the dates and will mature on the respective dates set forth in the inside cover page of this Official Statement. The Bonds are subject to redemption as described herein under the caption “THE BONDS – Mandatory Redemption of Bonds; – Optional Redemption of Bonds; and – Mandatory Sinking Fund Redemption.” For a more complete description of the Bonds, see “THE BONDS” herein.

THE SERIES 2017B BONDS (ALSO REFERRED TO HEREIN AS THE “SUBORDINATE BONDS”) ARE SUBORDINATE IN RIGHT OF PAYMENT, SECURITY AND PRIORITY TO THE SERIES 2017A BONDS (ALSO REFERRED TO HEREIN AS THE “SENIOR BONDS”).

Description of the Bonds

Redemption. The Bonds are subject to redemption prior to their stated maturity. See “THE BONDS – Mandatory Redemption of Bonds; – Optional Redemption of Bonds; and – Mandatory Sinking Fund Redemption” herein.

Denominations. The Bonds will be dated their date of delivery. The Bonds will bear interest at the respective rates, and will mature on the respective dates and in the amounts, all as set forth on the inside cover page of this Official Statement. The Bonds are issuable as fully registered bonds without coupons in denominations of $5,000 each and integral multiples thereof. See “THE BONDS” herein.

Registration, Transfers and Exchanges. The Bonds will be issued in fully registered form. When in book- entry form, ownership of the Bonds held by The Depository Trust Company (“DTC”) or its nominee, Cede & Co., on behalf of the beneficial owners thereof (the “Beneficial Owners”). DTC has no knowledge of the actual Beneficial Owners of the Bonds; DTC’s records show only the identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. See “THE BONDS – Book- Entry-Only System” herein.

Subordination of Subordinate Bonds. The security for and payment of the principal of, premium, if any, and interest on the Subordinate Bonds is subordinated to the security for and payment of the principal of, premium, if any, and interest on the Senior Bonds. Principal and interest on the Subordinate Bonds is payable as described under “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Funds Held Under the Indenture – Revenue Fund.” Under the Indenture, amounts deposited in the Revenue Fund will be used to fund the Bond Fund for payment of the Senior Bonds prior to funding the Bond Funds for payment of the Subordinate Bonds.

While any Senior Bonds are outstanding, a failure to make any debt service payments on the Subordinate Bonds does not constitute a Default or an Event of Default under the Indenture. If no Senior Bonds are outstanding, a failure to make payment on the principal of or premium, if any, or an installment of interest on any of the Subordinate Bonds shall constitute a Default or an Event of Default under the Indenture. See “RISK FACTORS AND INVESTMENT CONSIDERATIONS – Subordination of Subordinate Bonds” herein.

For more information on the Subordinate Bonds, see “THE BONDS” and “RISK FACTORS AND INVESTMENT CONSIDERATIONS – Subordination of Subordinate Bonds” herein and “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Indenture; Revenue Fund,” “– The Indenture; Surplus Fund” and “– The Indenture; Defaults and Remedies” in Appendix B hereto.

Payments. Interest on the Bonds will be payable semiannually on June 1 and December 1 of each year (the “Interest Payment Dates”), commencing June 1, 2017. The Bonds will be payable as to principal on the dates and in the amounts as set forth in the Indenture. Interest shall be computed on the basis of a year of 360 days and twelve 30-day months. Each Bond shall bear interest payable on the Interest Payment Date from the Interest Payment Date

to which interest has been paid or duly provided for, or, if no interest has been paid or duly provided for, from the Dated Date. See “THE BONDS” herein.

Tax Exemption. Butler Snow LLP, Baton Rouge, Louisiana, as Bond Counsel, will provide an opinion, substantially in the form contained in Appendix C to this Official Statement, to the effect that interest on the Tax- Exempt Bonds is not includable in gross income for federal income tax purposes. See “TAX MATTERS” herein. For a more complete description of the Tax-Exempt Bonds, see “THE BONDS” herein.

Security and Sources of Payment the Bonds

Trust Estate. The Bonds are secured by the Trust Estate created in the Indenture which includes all right, title and interest of the Authority in and to (a) the Note, the Mortgage, the Land Use Restriction Agreement and the Loan Agreement (other than the Reserved Rights of the Authority), including the proceeds thereof or recovery thereon; (b) all funds, money and securities from time to time held by the Trustee under the terms of the Indenture (except with respect to money in the Rebate Fund) and any interest, profits and other income derived from the investment thereof, including the proceeds of the Bonds, subject to the application thereof in accordance with the Indenture, including Net Proceeds; (c) any and all other rights and interests in property conveyed, mortgaged, pledged, assigned or transferred as and for additional security for the Bonds by the Authority or by anyone on its behalf or with its written consent to the Trustee; and (d) to the extent not covered above, all proceeds of the foregoing. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS” herein.

The Note. The Borrower is obligated under the Loan Agreement to make payments (the “Loan Payments”) in such amounts and at such times as will be sufficient to pay, when due, the principal of, premium, if any, and interest on the Bonds as well as pay certain other fees and expenses in connection with the Bonds. As evidence of its obligations to make the Loan Payments with respect to the Bonds the Borrower will execute and deliver to the Trustee a Promissory Note (the “Note”).

Nonrecourse Obligations. The Borrower’s obligations under the Loan Agreement, the Note and the Mortgage are limited, nonrecourse obligations and the Borrower has no obligation to make payments of amounts due under the Loan Agreement except from Project Revenues and from amounts held in the Funds and Accounts created under the Indenture and the security provided by the Mortgage. No other revenues or assets of the Borrower or the Sole Member will be available for the payment of, or as security for, the Bonds. The right of the Authority to collect and receive payments under the Loan Agreement has been assigned to the Trustee under the Indenture for the benefit of the Holders of the Bonds. No assets or other revenues of the Authority are or will be available for the payment of, or as security for, the Bonds. The Sole Member will have no liability on account of financial obligations of the Borrower under the Loan Agreement and the Note or the other Bond Documents. The Sole Member will enter into certain other of the documents relating to the Bonds for the sole purpose of agreeing to comply with the tax covenants therein, but the Trustee’s recourse against the Sole Member for any violation of these covenants will be limited to the Sole Member’s interest in the Borrower.

Mortgage. As further security for the Bonds, and to secure the Borrower’s obligations under the Note and the Loan Agreement, the Borrower will grant to the Trustee a Multiple Indebtedness Mortgage, Security Agreement, and Pledge of Leases and Rents dated on or about the date of issuance of the Bonds (the “Mortgage”). See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Mortgage” herein.

Rate Covenant. The Borrower has agreed in the Loan Agreement to use its best efforts to fix, charge and collect, or cause to be fixed, charged and collected, rents, fees and charges in connection with the operation and maintenance of the Project, such that for each Fiscal Year, beginning with the Fiscal Year ending December 31, 2017, the Debt Service Coverage Ratio (as defined in the Indenture) will not be less than 1.25 to 1.00 on all Outstanding Senior Bonds and all Senior Parity Indebtedness and 1.15 to 1.00 on all Outstanding Senior Bonds and Subordinate Bonds and all Senior Parity Indebtedness and Subordinate Parity Indebtedness, determined as of the end of each such Fiscal Year. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Rate Covenant” herein.

The Authority

The Authority is a political subdivision of the State of Louisiana, organized under the provisions of Chapter 10-D of Title 33 of the Louisiana Revised Statutes of 1950, as amended (La R.S. 33:4548.1 through 33:4548.16) (the “Act”). The purpose of the Authority is, among others enumerated in the Act, to assist in financing programs or loans to political subdivisions (as defined in the Act) in the State of Louisiana. In furtherance of its authorized powers and functions, the Authority has the power, by virtue of the Act, to issue the Bonds, to loan the proceeds thereof to the Corporation and to secure the Bonds by a pledge of the amounts payable by the Corporation under the Loan Agreement. Any political subdivision of the State may become as a member of the Authority.

The Authority is governed by a Board of Directors whose membership is limited to those representatives of political subdivisions of the State maintaining membership in the Authority (each a “Participating Political Subdivision”) whose governing authorities have adopted a resolution indicating their intention to participate in the Authority. Each Participating Political Subdivision may appoint a Director in accordance with the Act. Directors are appointed for two (2) year terms and may be removed for just cause. Officers are elected by and from the ranks of the members of the Board of Directors and consist of a Chairman, Vice-Chairman and Secretary-Treasurer. Officers serve one (1) year terms and may not be re-elected for successive terms in any one office.

Pursuant to the Authority’s by-laws, the Board of Directors has established an Executive Committee (the “Executive Committee”) and, in accordance with the Act, delegated certain duties and authorities to the Executive Committee. The Executive Committee consists of seven members, three of whom are the officers of the Authority and serve as ex-officio members for as long as they remain officers of the Board of Directors. The remaining four (4) members are elected at an annual meeting of the Board of Directors and serve as at-large members with one member elected for a term of one (1) year, one member elected for a term of two (2) years, one member elected for a term of three (3) years and one member elected for a term of four (4) years. An at-large member may not be re- elected to the Executive Committee as an at-large member and his successor shall be elected for a four (4) year term. The Executive Committee is required to make an annual report to the Board of Directors at its annual meeting. Provision is made in the by-laws to make the minutes of all Executive Committee meetings available to members of the Board of Directors.

The current members of the Executive Committee, their positions, terms of office and respective Participating Political Subdivision are as follows:

Present Committee Term Participating Members Position Expires Political Subdivision

Mr. Julian Dufreche Chairman 12/31/18 Tangipahoa Parish Clerk of Court Mr. Mack Dellafosse Vice Chairman 12/31/18 Calcasieu Parish School Board Mr. David Camardelle Secretary-Treasurer 12/31/18 Town of Grand Isle Mayor David C. Butler, II Member 12/31/18 Town of Woodworth Mr. Lynn Austin Member 12/31/19 City of Bossier Mayor Billy D’Aquilla Member 12/31/20 Town of St. Francisville Mr. David Rabalais Member 12/31/21 Terrebonne Port Commission Ms. Mary S. Adams Advisory Committee - -

The address of the Authority is 5420 Corporate Boulevard, Ste. 205, Baton Rouge, LA 70802. The Bonds were authorized by resolutions adopted by the Executive Committee on October 13, 2016, February 14, 2017 and March 9, 2017 in an amount not to exceed $19,085,000.

EXCEPT FOR INFORMATION CONCERNING THE AUTHORITY IN THE SECTIONS HEREOF CAPTIONED “THE AUTHORITY” AND “ABSENCE OF LITIGATION - THE AUTHORITY,” NONE OF THE INFORMATION IN THIS OFFICIAL STATEMENT HAS BEEN SUPPLIED OR VERIFIED BY THE AUTHORITY, AND THE AUTHORITY MAKES NO REPRESENTATIONS OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION.

The Borrower and the Sole Member

The Borrower is a newly created single asset entity, of which Invest in America’s Veterans Foundation, Inc. (the “Sole Member”), a Florida nonprofit corporation recognized as an organization described under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the “Code”), is the Sole Member. The Borrower has no operating history and has no financial statements. See “THE BORROWER AND THE PROJECT – The Borrower” and “– The Sole Member” herein.

The Project

The Project. The Project is an existing multifamily residential rental housing facility known as The Cove at NOLA Apartments and is located at 10501 Curran Boulevard, New Orleans, Louisiana 70127. The Project was originally constructed in 1987 and renovated in 2014. The Project contains 20 three-story buildings and three one- story accessory buildings. Within the Project, there are a total of 300 dwelling units that contain approximately 280,200 square feet of rentable space. The dwelling units are divided into 120 one-bedroom and one-bathroom units, 132 two-bedroom and two-bathroom units, and 48 three-bedroom and three-bathroom units. Concrete-paved walkways provide access throughout the Project and from parking lots to building entrances. The table below sets forth the current unit mix and gross potential rental income for the Project.

Gross Potential Gross Potential Unit Mix # of Units Square Footage Contract Rent Rent (Month) Rent (Annual) 1x1 103 680 $661 $68,073 $816,872 1x1 17 680 $763 $12,972 $155,664 2x2 105 1,050 $825 $86,634 $1,039,613 2x2 27 1,050 $953 $25,744 $308,928 3x2 40 1,250 $941 $37,651 $451,814 3x2 8 1,250 $1,091 $8,728 $104,736 Total 300 934 $799 $239,802 $2,877,627 Reflects current rent roll as of February 24, 2017.

See “THE BORROWER AND THE PROJECT – The Project” herein.

The Asset Manager. Concurrently with the issuance of the Bonds, the Sole Member will enter into an asset management agreement (the “Asset Management Agreement”) with Strategic Realty Capital, LLC, a Delaware limited liability company (the “Asset Manager”). The Asset Manager is headquartered in Santa Monica, California. See “THE BORROWER AND THE PROJECT – The Asset Manager” herein.

Appraisal. Gill Group, Inc. (the “Appraiser”) was retained by the Borrower to prepare an appraisal to estimate the market value of the existing property known as The Cove at NOLA Apartments’ fee simple interest, for financing decisions and mortgage underwriting. The Appraiser derived the “As Is” market value of the subject property, subject to market rents, as of August 23, 2016 with a report date of September 14, 2016, with respect to the Project (the “Appraisal”). The Appraiser determined the estate (i) “as-is” “market value” via the sales comparison approach is $17,400,000, (ii) “as-is” “market value” via the income approach is $17,225,000, and (iii) final “as-is” “market value” is $17,225,000. Such values are based upon certain assumptions and limiting conditions set forth in the Appraisal. See “APPRAISAL” herein.

Property Condition Assessment Report

On August 23, 2016, Gill Group, Inc. prepared a Property Condition Assessment Report (“PCR”) for the Cove at NOLA Apartments. The purpose of the PCR is to provide information to evaluate the condition of the subject property in order to facilitate completion of due diligence by the addressee. The purpose is accomplished by describing the primary systems and components of the subject property, identifying conspicuous defects or material deferred maintenance, and presenting an opinion of costs to remedy the observed conditions. In addition, the PCR identifies systems or components that are anticipated to reach the end of their expected useful life during the specified evaluation period and includes an opinion for future capital replacements. The PCR identified $2,700 in

immediate and short-term repair needs. The PCR also noted that the Borrower needs to fund $300 per unit per year for capital replacement reserve items.

The Borrower expects to make the following renovations to the Cove at NOLA Apartments.

The Cove at NOLA Apartments – Scope of Rehabilitation Description of Work Cost Parking lot striping 2,700.00 Parking lot and concrete walkways - patchwork 27,300.00 Replace and (or) repair balconies and patios $50,000.00 Replace and (or) repair outdated HVAC systems $30,000.00 Replace and paint all exterior wood furnishings that have rot or other damages $44,000.00 Interior work – replace carpet and tile and community room upgrades 65,000.00 TOTAL $219,000.00

Certain Tax Matters

The Bonds will be issued as “qualified 501(c)(3) bonds” as defined in Section 145 of the Code. Although the Borrower is not an organization described in Section 501(c)(3) of the Code, in the opinion of Brennan, Manna & Diamond, LLC, counsel to the Borrower and the Sole Member, the Borrower should be disregarded as an entity separate from its owner, the Sole Member, for federal income tax purposes. Consequently, the Borrower should be treated as a part of the Sole Member, which is a 501(c)(3) entity, for federal income tax purposes.

Additionally, in order for the Bonds to be treated as “qualified 501(c)(3) bonds,” the Project must meet certain occupancy restrictions set forth in Section 142(d) and Section 145(d) of the Code. Therefore, the Borrower’s operation of the Project will be subject to the terms and restrictions of a Land Use Restriction Agreement dated on or about the date of issuance of the Bonds, entered into among the Authority, the Borrower and the Trustee (the “Land Use Restriction Agreement”), and the Tax Agreement and No Arbitrage Certificate, dated the date of Closing, executed by the Authority, the Sole Member and the Borrower (the “Tax Agreement”). The Land Use Restriction Agreement, among other things, will require that for the Qualified Project Period (as defined in the Regulatory Agreement), at least 40% of the dwelling units in each property site comprising the Project be occupied by Low Income Tenants, defined as families or individuals whose income does not exceed 60% (adjusted for family size) of the median gross income for the area in which the Project is located. See “THE BORROWER AND THE PROJECT – Project Regulation” and “RISK FACTORS AND INVESTMENT CONSIDERATIONS – Project Risks: Rental Housing Requirements” herein and “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Land Use Restriction Agreement” in Appendix B hereto.

Furthermore, the Borrower will be obligated to operate the Project in accordance with Revenue Procedure 96-32 issued by the Internal Revenue Service (the “IRS”) in order to maintain the Sole Member’s status as an entity described in Section 501(c)(3) of the Code. The terms of the Tax Agreement will therefore require that for so long as the Borrower is the owner of the Project, at least 75% of the dwelling units in the Project be occupied by families of low income (the “Low Income Tenants”), defined as families or individuals whose adjusted gross income does not exceed 80% of the median gross income for the New Orleans, Louisiana MSA, as adjusted for family size. The Land Use Restriction Agreement and the Tax Agreement will have the effect of reducing the potential universe of tenants eligible to reside in the Project. See “THE BORROWER AND THE PROJECT – Project Regulation,” and “RISK FACTORS AND INVESTMENT CONSIDERATIONS – Project Risks; Rental Housing Requirements” herein and “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Land Use Restriction Agreement” in Appendix B hereto.

Certain Bondholders’ Risks

Risk Factors. AN INVESTMENT IN THE BONDS INVOLVES A DEGREE OF RISK, INCLUDING, AMONG OTHERS, RISKS ASSOCIATED WITH THE LIMITED SOURCE OF PAYMENT FOR THE BONDS AND VARIOUS REAL ESTATE AND OPERATING RISKS. PROSPECTIVE PURCHASERS SHOULD

CAREFULLY CONSIDER ALL OF THE STATEMENTS AND INFORMATION CONTAINED IN THIS OFFICIAL STATEMENT, INCLUDING THE MATERIAL UNDER THE CAPTION “RISK FACTORS AND INVESTMENT CONSIDERATIONS.”

This Official Statement and the Appendices attached hereto contain descriptions of, among other matters, the Bonds, the Borrower, the Project, the Asset Manager, the Indenture, the Loan Agreement, the Mortgage, the Note, the Land Use Restriction Agreement, the Tax Agreement and the Continuing Disclosure Agreement. Such descriptions and information do not purport to be comprehensive or definitive. Definitions of certain terms and words used in this Official Statement and not otherwise defined are set forth in the Indenture. All references herein to any agreements are qualified in their entirety by reference to such agreements and documents, and all references herein to the Bonds are qualified in their entirety by reference to the forms thereof included in the Indenture. Copies of such agreements and all other documents referenced herein are available to the recipient of this Official Statement during the initial offering period by contacting the Underwriter.

THE BONDS

The Bonds are available in book-entry only form. See “Book-Entry-Only System” below. So long as Cede & Co., as nominee of The Depository Trust Company (“DTC”), is the registered owner of the Bonds, references herein to the Bondholders or holders or Holders or registered owners of the Bonds means Cede & Co. and not the Beneficial Owners of the Bonds.

General Description

The Bonds are issuable as fully registered bonds without coupons in denominations of $5,000 each and integral multiples thereof. The Bonds will be dated their date of delivery. The Bonds will bear interest at the rates, and will mature on the dates and in the amounts, all as set forth on the inside cover page of this Official Statement. Interest on the Bonds will be payable semiannually on each June 1 and December 1 of each year (the “Interest Payment Dates”) commencing June 1, 2017, and be payable as to principal on the dates and in the amounts as set forth in the Indenture. Interest shall be computed on the basis of a year of 360 days and twelve 30-day months.

Each Bond shall bear interest from the Interest Payment Date preceding the date of authentication thereof, unless the date of such authentication is after the fifteenth day (whether or not a Business Day) of the calendar month preceding the applicable Interest Payment Date (the “Record Date”), in which case it will bear interest from the next succeeding Interest Payment Date, or unless no interest has been paid on such Bond, in which case from their date of delivery; provided, however, that if at the time of registration of any Bond the interest thereon is in default, as shown by the records of the Trustee, such Bond shall bear interest from the date to which interest has been paid in full.

Subordinate Bonds

The Subordinate Bonds are subordinate to the Senior Bonds as described herein and as set forth in the Indenture. Under the Indenture, amounts deposited in the Revenue Fund will be used to fund the Bond Fund for payment of the Senior Bonds prior to funding the Bond Fund for the Subordinate Bonds. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – THE INDENTURE – Revenue Fund” and “– Surplus Fund” in Appendix B hereto.

Amounts on deposit in a Bond Fund for a particular Series of Bonds will be used solely to pay principal and interest on the related Series of Bonds, on the applicable payment dates. If there is a shortfall of revenues, deposits to the Bond Fund for the Senior Bonds must be made prior to any such deposits being made with respect to the Subordinate Bonds. Under such circumstances, principal and/or interest on the Subordinate Bonds may remain unpaid.

proceedings for redemption, by declaration or otherwise constitutes an Event of Default. While any Senior Bonds are outstanding, a failure to make any debt service payments on the Subordinate Bonds does not constitute a Default or an Event of Default under the Indenture. If no Senior Bonds are outstanding, failure to pay an installment of interest on any of the Subordinate Bonds when such interest becomes due and payable and failure to pay the principal of, or premium, if any, on any of the Subordinate Bonds when such becomes due and payable, whether at maturity, by proceedings for redemption, by declaration or otherwise constitutes an Event of Default.

An Event of Default with respect to the Subordinate Bonds will not, in and of itself, constitute an Event of Default with respect to the Senior Bonds. A FAILURE TO PAY PRINCIPAL OR INTEREST ON THE SUBORDINATE BONDS WILL NOT CONSTITUTE AN EVENT OF DEFAULT AS LONG AS THE SENIOR BONDS ARE OUTSTANDING.

Upon the occurrence and continuance of an Event of Default, the Trustee, subject to the provisions of the Indenture, may, and at the written request of the Controlling Holders (or in the case of an Event of Default under Section 8.01(c) of the Indenture, unanimous written request of the Holders of the Bond Obligation for the Senior Bonds, if any Senior Bonds remain Outstanding or unanimous written request of the Holders of the Bond Obligation for the Subordinate Bonds if no Senior Bonds remain Outstanding) shall, by written notice to the Authority and the Borrower, declare the Bonds to be immediately due and payable, whereupon such Bonds shall, without further action, become and be immediately due and payable, anything in the Indenture or in the Bonds to the contrary notwithstanding, and the Trustee shall give notice thereof to the Authority and the Rating Agency, and shall give notice thereof by Mail to Holders of the Bonds.

Notwithstanding any other provision of the Indenture to the contrary, (i) if an Event of Default with respect to the payment of the principal of or interest on the Subordinate Bonds occurs (but an Event of Default does not exist with regard to the Senior Bonds) while any Senior Bonds remain Outstanding, then the Trustee shall not accelerate the Bonds and shall not exercise any of the other remedies available pursuant to the Indenture or applicable law without the consent of the Holders of all of the Senior Bonds. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Indenture; Revenue Fund” and “—The Indenture; Defaults and Remedies” in Appendix B hereto.

Transfer and Exchange of the Bonds

So long as the Bonds are in book-entry only form, Cede & Co., as nominee of DTC, will be the sole registered owner of the Bonds. Transfers of beneficial interests in the Bonds will be made as described below under “Book-Entry-Only System.”

Book-Entry-Only System

The following has been provided by DTC for use herein. While the information is believed to be reliable, none of the Authority, the Trustee, the Borrower or the Underwriter, subject to the standard of review found on the inside cover hereof, nor any of their respective counsel, members, officers or employees, make any representations as to the accuracy or sufficiency of such information.

DTC will act as securities depository for the Bonds. The Bonds will be issued as fully registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully registered Bond will be issued for each maturity of the Bonds, each in the aggregate principal amount of such maturity, and will be deposited with DTC.

DTC is a limited purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non U.S. equity issues, corporate and municipal debt issues, and money market instruments from over 100 countries that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post trade settlement among Direct Participants of sales and other

securities transactions in deposited securities, through electronic computerized book entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non U.S securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC, in turn, is owned by a number of Direct Participants of DTC and members of the National Securities Clearing Corporation, Fixed Income Clearing Corporation and Emerging Markets Clearing Corporation (NSCC, FICC, and EMCC, also subsidiaries (DTCC), as well as by the New York Stock Exchange, Inc., the American Stock Exchange LLC. and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as both U.S. and non U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC is rated AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com and www.dtc.org.

Purchases of the Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the Bonds on DTC’s records. The ownership interest of each actual purchaser of each Bond (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in the Bonds, unless use of the Book-Entry System for the Bonds is discontinued.

To facilitate subsequent transfers, all Bonds deposited by Direct Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not affect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Bonds; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Bonds, such as redemptions, tenders, defaults, and proposed amendments to the Bond Documents. For example, Beneficial Owners of Bonds may wish to ascertain that the nominee holding the Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them.

Redemption notices will be sent to DTC. If less than all of the securities within an issue are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to securities unless authorized by a Direct Participant in accordance with DTC’s Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the Authority as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).

Payment of principal, premium, if any, and any interest on the Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the Authority or the Trustee, on each payment date in accordance with their respective holdings shown on DTC’s records. Payments by

Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such Participant and not of DTC, the Trustee, or the Authority, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, interest and principal payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Authority or the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

DTC may discontinue providing its services as depository with respect to the Bonds at any time by giving reasonable notice to the Authority or the Trustee. Under such circumstances, in the event that a successor depository is not obtained, Bond certificates are required to be printed and delivered.

The Authority may decide to discontinue use of the Book-Entry System transfers through DTC (or a successor securities depository); in that event, Bond certificates will be printed and delivered to DTC.

The information under this heading concerning DTC and DTC’s Book-Entry System has been obtained from sources that the Authority believes to be reliable, but the Authority takes no responsibility for the accuracy thereof.

NEITHER THE AUTHORITY NOR THE TRUSTEE WILL HAVE ANY RESPONSIBILITY OR OBLIGATION TO DTC PARTICIPANTS, OR THE PERSONS FOR WHOM THEY ACT AS NOMINEES, WITH RESPECT TO THE PAYMENTS TO OR THE PROVIDING OF NOTICE TO THE DIRECT PARTICIPANTS, THE INDIRECT PARTICIPANTS OR THE BENEFICIAL OWNERS OF THE BONDS. THE AUTHORITY AND THE TRUSTEE CANNOT AND DO NOT GIVE ANY ASSURANCES THAT DTC, DIRECT PARTICIPANTS OR OTHERS WILL DISTRIBUTE PAYMENTS OF PRINCIPAL OF OR INTEREST ON THE BONDS PAID TO DTC OR ITS NOMINEE, AS THE REGISTERED OWNER, OR ANY NOTICES TO THE BENEFICIAL OWNERS OR THAT THEY WILL DO SO ON A TIMELY BASIS, OR THAT DTC WILL ACT IN A MANNER DESCRIBED IN THIS OFFICIAL STATEMENT.

Revision of Book-Entry-Only System

In the event that either: (i) the Authority receives notice from DTC to the effect that DTC is unable or unwilling to discharge its responsibilities as a clearing agency for the Bonds or (ii) the Authority elects to discontinue its use of DTC as a clearing agency for the Bonds, then the Authority and the Trustee will do or perform or cause to be done or performed all acts or things, not adverse to the rights of the holders of the Bonds, as are necessary or appropriate to discontinue use of DTC as a clearing agency for the Bonds and to transfer the ownership of each of the Bonds to such person or persons, including any other clearing agency, as the holder of such Bonds may direct in accordance with the Indenture. Any expense of such a discontinuation and transfer, including any expenses of printing new certificates to evidence the Bonds, will be paid by the Borrower.

Mandatory Redemption of Bonds

The Bonds shall be called for redemption (1) in whole or in part in the event the Project or any portion thereof is damaged or destroyed or taken in a condemnation proceeding and Net Proceeds resulting therefrom are to be applied to the payment of the Note as provided in the Loan Agreement and the Borrower pursuant to the Loan Agreement has elected to use the Net Proceeds to redeem Bonds, (2) in whole in the event the Borrower exercises its option to terminate the Loan Agreement due to the events permitting termination listed therein, (3) in whole or in part from proceeds of the title insurance policy as provided in the Loan Agreement or (4) in whole in the event the Borrower is required to prepay the Loan following a Default under the Loan Agreement. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Loan Agreement” in Appendix B hereto.

If called for redemption at any time pursuant to (1) through (4) above, the Bonds to be redeemed shall be subject to redemption by the Authority prior to maturity, in whole at any time or (in the case of redemption pursuant to clause (1) above) in part on any Interest Payment Date (less than all of such Bonds to be selected in accordance with the provisions of the Indenture (as described under the caption “Selection of Bonds to be Redeemed” below)) at a redemption price equal to 100% of the principal amount thereof plus accrued interest to the redemption date; such redemption date to be a date determined by the Borrower, and in the case of redemption pursuant to clause (4) above, to be the earliest practicable date, as determined by the Trustee, following acceleration of amounts due under the Loan Agreement.

No Subordinate Bonds may be redeemed as described in this section if any Senior Bonds remain Outstanding except that the Subordinate Bonds may only be redeemed on any Interest Payment Date if the principal and interest due on the Senior Bonds at such time has been paid in full.

Optional Redemption of Bonds

Except as set forth below, the Series 2017A Bonds are subject to optional redemption by the Authority, at the direction of the Borrower, on or after December 1, 2022, in whole or in part at any time, at the following redemption prices as a percentage of the par amount set forth below, plus accrued interest to the redemption date:

Redemption Period Redemption Price December 1, 2022 through November 30, 2023 105% December 1, 2023 through November 30, 2024 104% December 1, 2024 through November 30, 2025 103% December 1, 2025 through November 30, 2026 102% December 1, 2026 through November 30, 2027 101% December 1, 2027 and thereafter 100%

Except as set forth below, the Subordinate Series 2017B Bonds are subject to optional redemption by the Authority, at the direction of the Borrower, on or after December 1, 2022, in whole or in part at any time, at the following redemption prices as a percentage of the par amount set forth below, plus accrued interest to the redemption date:

No Subordinate Bonds, or any portion thereof, may be redeemed pursuant to optional redemption if any Senior Bonds remain outstanding.

Mandatory Sinking Fund Redemption

The Series 2017A Bonds maturing on December 1, 2027 are subject to mandatory sinking fund redemption at a redemption price equal to 100% of the principal amount thereof plus accrued interest on June 1 and December 1 of each year and in the principal amounts shown below:

SERIES 2017A BONDS MATURING DECEMBER 1, 2027

Date Amount

The Series 2017A Bonds maturing on December 1, 2042 are subject to mandatory sinking fund redemption at a redemption price equal to 100% of the principal amount thereof plus accrued interest on June 1 and December 1 of each year and in the principal amounts shown below:

SERIES 2017A BONDS MATURING DECEMBER 1, 2042

Date Amount

The Series 2017A Bonds maturing on December 1, 2052 are subject to mandatory sinking fund redemption at a redemption price equal to 100% of the principal amount thereof plus accrued interest on June 1 and December 1 of each year and in the principal amounts shown below:

SERIES 2017A BONDS MATURING DECEMBER 1, 2052

Date Amount

The Series 2017B Bonds are subject to mandatory sinking fund redemption at a redemption price equal to 100% of the principal amount thereof plus accrued interest on June 1 and December 1 of each year in the principal amounts shown below:

SERIES 2017B BONDS MATURING DECEMBER 1, 2052

Date Amount

Selection of Bonds to be Redeemed

Bonds may be redeemed only in Authorized Denominations. If less than all of the Bonds are being redeemed: (a) the principal amount and Series of the Bonds to be redeemed shall be designated by a Borrower’s Representative in writing to the Trustee and (b) the particular Bonds of the Series or portions thereof to be redeemed shall be selected by DTC or any successor depository in accordance with its procedures, or, if the book-entry system is discontinued, by the Trustee by lot. If it is determined that less than all of the principal amount represented by any Bond is to be called for redemption, then, following notice of intention to redeem such principal amount, the Holder thereof shall surrender such Bond to the Trustee on or before the applicable redemption date for (i) payment on the redemption date to such Holder of the redemption price of the amount called for redemption and (ii) delivery to such Holder of a new Bond or Bonds of such Series in the aggregate principal amount of the unredeemed balance of the principal amount of such Bond, which shall be an Authorized Denomination. A new Bond of such Series representing the unredeemed balance of such Bond shall be issued to the Holder thereof, without charge therefor. Such provision shall not apply to scheduled mandatory sinking fund redemptions. If the Holder of any Bond or integral multiple of the Authorized Denomination selected for redemption shall fail to present such Bond to the Trustee for payment and exchange as aforesaid, such Bond shall, nevertheless, become due and payable on the date fixed for redemption to the extent of the amount called for redemption (and to that extent only), and interest shall cease to accrue from the date fixed for redemption.

Notice of Redemption

In the event any of the Bonds are called for redemption, the Trustee shall give notice, in the name of the Authority, of the redemption of such Bonds, which notice shall (i) specify the Bonds to be redeemed, the redemption date, the redemption price and the place or places where amounts due upon such redemption will be payable (which shall be the designated corporate trust office of the Trustee) and, if less than all of the Bonds are to be redeemed, the numbers of the Bonds, and the portions of the Bonds, to be so redeemed, (ii) state any condition to such redemption, including any redemption premium, and (iii) state that on the redemption date, and upon satisfaction of any such condition, the Bonds to be redeemed shall cease to bear interest. Such notice may set forth any additional information relating to such redemption. Such notice shall be given by Mail to the Holders of the Bonds to be redeemed, at least thirty (30) days but no more than sixty (60) days prior to the date fixed for redemption. If a notice of redemption shall be unconditional, or if the conditions of a conditional notice of redemption shall have been satisfied, then upon presentation and surrender of the Bonds so called for redemption at the place or places of payment, such Bonds shall be redeemed.

The Trustee may give any additional redemption notice as it deems necessary or desirable, but is not obligated to give or provide any additional notice or information.

Any Bonds which have been duly selected for redemption and which are deemed to be paid in accordance with the Indenture shall cease to bear interest on the specified redemption date.

Payment of Redemption Price

For the redemption of any of the Bonds of a Series, the Trustee shall cause to be deposited in the Special Redemption Account of the Bond Fund, whether out of Project Revenues or any other moneys constituting the Trust Estate, including Net Proceeds available for such purpose pursuant to the Loan Agreement, or otherwise, an amount sufficient to pay the principal of, premium, if any, and interest to become due on the date fixed for such redemption. Moneys used to pay premium, if any, on Bonds to be redeemed shall constitute Available Moneys. The obligation of the Authority to cause any such deposit to be made under the Indenture shall be reduced by the amount of moneys in such Special Redemption Account available for and used on such redemption date for payment of the principal of, premium, if any, and accrued interest on the Bonds to be redeemed.

No Partial Redemption After Event of Default

Anything in the Indenture to the contrary notwithstanding, if there has occurred and is continuing an Event of Default under the Indenture on account of a failure to pay the principal of or premium, if any, or any installment of interest on the Bonds when due and payable with respect to the Bonds, there shall be no redemption of less than all of the Bonds Outstanding. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Indenture” in Appendix B hereto.

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ANNUAL DEBT SERVICE REQUIREMENTS

The principal (including principal payable at maturity and by mandatory sinking fund redemption) and interest payment requirements with respect to the Bonds are as follows:

Calendar Year ending Series Series Total December 31 2017A Bonds 2017B Bonds Debt Service 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052

TOTALS $ $ $

SOURCES AND USES OF FUNDS

The Borrower expects the proceeds of the Bonds to be provided to be used and applied in the following manner.

Sources of Funds: Series 2017A Bonds $16,750,000 Series 2017B Bonds $2,335,000 Original Issue Discount/Premium ($460,451) Other Source of Funds $330,000 Total Sources of Funds $18,954,549

Uses of Funds: Acquisition of the Project1 $17,576,587 Project Fund2 $219,000 Debt Service Reserve Fund3 $575,447 Cost of Issuance4 $583,515 Total Uses of Funds $18,954,549 ______1 Includes the acquisition price and other real estate closing costs. 2 Project Fund deposit includes renovation moneys. 3An amount equal to maximum annual debt service on the Bonds shall be deposited with the Trustee in accounts within the Debt Service Reserve Fund. 4 Fees of Underwriter, Bond Counsel, Underwriter’s Counsel, Authority’s Counsel, Borrower’s Counsel, Trustee, Rating Agency and other costs of issuance of the Bonds.

SECURITY AND SOURCES OF PAYMENT FOR THE BONDS

Trust Estate

The Bonds are secured by a first lien on and pledge and assignment of a security interest in the Trust Estate. The Trust Estate includes (a) all right, title and interest of the Authority in and to the Note, the Mortgage, the Land Use Restriction Agreement and the Loan Agreement (other than the Reserved Rights of the Authority), including the proceeds thereof or recovery thereon; (b) all funds, money and securities from time to time held by the Trustee under the terms of the Indenture (except with respect to money in the Rebate Fund) and any interest, profits and other income derived from the investment thereof, including the proceeds of the Bonds, subject to the application thereof in accordance with the Indenture, including Net Proceeds; (c) any and all other rights and interests in property conveyed, mortgaged, pledged, assigned or transferred as and for additional security for the Bonds by the Authority or by anyone on its behalf or with its written consent to the Trustee; and (d) to the extent not covered above, all proceeds of the foregoing. The Subordinate Bonds are subordinate in all respects to the Senior Bonds.

Limited Obligations of Authority

THE BONDS AND THE INTEREST THEREON ARE SPECIAL, LIMITED OBLIGATIONS OF THE AUTHORITY PAYABLE SOLELY FROM THE TRUST ESTATE (OTHER THAN RESERVED RIGHTS). THE BONDS SHALL NOT BE DEEMED TO CONSTITUTE A DEBT OR LIABILITY OF THE STATE OR OF ANY GOVERNMENTAL UNIT THEREOF BUT SHALL BE PAYABLE SOLELY FROM THE FUNDS PROVIDED FOR IN THE INDENTURE AND IN THE LOAN AGREEMENT. THE ISSUANCE OF THE BONDS SHALL NOT, DIRECTLY, INDIRECTLY OR CONTINGENTLY OBLIGATE THE STATE OR ANY GOVERNMENTAL UNIT THEREOF TO LEVY ANY TAXES OR TO MAKE ANY APPROPRIATION FOR THEIR PAYMENT. THE AUTHORITY HAS NO TAXING POWER.

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Repayment of Loan

The Loan Agreement and the Note obligate the Borrower to pay to the Trustee, for the account of the Authority, monthly payments equal to the amounts required to pay the interest coming due on each Interest Payment Date with respect to the Bonds plus the principal amount of the Bonds maturing or required to be redeemed. The Borrower’s obligations to make Loan Payments are limited obligations of the Borrower, and holders of the Bonds will have recourse only to the Project, the moneys held in the Funds and Accounts created under the Indenture (except as specifically set forth therein) and the Project Revenues to satisfy the obligations of the Borrower with respect to the Bonds. No other revenues or assets of the Borrower or Sole Member will be available for the payment of, or as security for, the Bonds. Pursuant to the Indenture, the Authority will pledge and assign all its rights and interests (except for Reserved Rights) and all amounts payable (other than certain fees and expenses due to the Authority) under the Loan Agreement, the Note and the Mortgage to the Trustee, in trust, to be held and applied pursuant to the provisions of the Indenture, for the benefit of the Holders on a senior basis with respect to the Holders of the Senior Bonds relative to the Holders of the Subordinate Bonds.

Mortgage

To secure the payment of the Loan Payments payable under the Loan Agreement and the Note, the Borrower will grant to the Trustee under the Mortgage, a first priority lien on and a security interest in the Project and the right, title and interests of the Borrower in the Project Revenues and other property as described in the Mortgage. The Mortgaged Property includes generally all the buildings, fixtures and equipment comprising the Project. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Mortgage” in Appendix B hereto. See also “RISK FACTORS AND INVESTMENT CONSIDERATIONS – Project Risks – Risks of Real Estate Investment” herein.

Operation of the Project

Payments to be made by the Borrower pursuant to the Loan Agreement will be derived solely from Project Revenues. In addition, the liability of the Borrower under the Loan Agreement is limited to the Borrower’s interest in the Project and the monies held in the Funds and Accounts held under the Indenture (except as specifically set forth therein). NO REPRESENTATIONS OR ASSURANCES CAN BE MADE THAT REVENUES WILL BE REALIZED BY THE BORROWER IN AMOUNTS NECESSARY TO ENABLE THE BORROWER TO OPERATE THE PROJECT AND TO MAKE PAYMENTS PURSUANT TO THE LOAN AGREEMENT SUFFICIENT TO PAY THE PRINCIPAL OF AND PREMIUM, IF ANY, AND INTEREST ON THE BONDS.

Rate Covenant

The Borrower has agreed in the Loan Agreement to use its best efforts to fix, charge and collect, or cause to be fixed, charged and collected, rents, fees and charges in connection with the operation and maintenance of the Project, such that for each Fiscal Year, beginning with the Fiscal Year ending December 31, 2017, the Debt Service Coverage Ratio will not be less than the applicable Coverage Test (being 1.25 to 1.00 on all Outstanding Senior Bonds and all Senior Parity Indebtedness and 1.15 to 1.00 on all Outstanding Senior Bonds and Subordinate Bonds and all Senior Parity Indebtedness and all Subordinate Parity Indebtedness), determined as of the end of each such Fiscal Year. In the event that the Borrower should fail to meet such rate covenant, the Borrower is required to retain a consultant to make recommendations with respect to the operations of the Project and the sufficiency of the rates, fees and charges imposed by the Borrower to enable the Borrower to improve the Debt Service Coverage Ratio to at least the applicable Coverage Test. Failure by the Borrower to retain a consultant or implement the recommendations of that consultant in any calendar year in which the Debt Service Coverage Ratio is not met will constitute a Default as set forth in the Loan Agreement. Failure of the Borrower to meet the rate covenant does not constitute an Event of Default with respect to the Bonds. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Loan Agreement” in Appendix B hereto.

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Flow of Project Revenues

The following chart depicts the flow of Project Revenues described under “Revenue Fund” below:

Revenue Fund

Accounts Related to Senior Bonds Interest Account Principal Account Debt Service Reserve Account

Accounts Related to Subordinate Bonds

Interest Account Principal Account Debt Service Reserve Account

Funds for Operations* Insurance and Tax Escrow Fund Operating Fund Repair and Replacement Fund Administration Fund Rebate Fund Management Fee

Surplus Fund

______* Includes Rent Payments.

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Revenue Fund

The Trustee is to deposit into the Revenue Fund (i) all Loan Payments and other amounts paid to the Trustee under the Loan Agreement (other than prepayments required to redeem Bonds pursuant to the Indenture, which shall be deposited in the related Special Redemption Account), (ii) all other amounts required to be so deposited pursuant to the terms of the Indenture or of the Tax Agreement, including investment earnings to the extent provided in the Indenture, (iii) any amounts derived from the Loan Agreement or the Mortgage to be applied to payment of amounts intended to be paid from the Revenue Fund, (iv) all Project Revenues, and (v) such other moneys as are delivered to the Trustee by or on behalf of the Authority or the Borrower with directions for deposit of such moneys in the Revenue Fund.

Moneys on deposit in the Revenue Fund shall be disbursed on the 15th day of each month in the following order or priority:

(1) To the Interest Account for the Senior Bonds, the Interest Requirement for the Senior Bonds for that calendar month, together with an amount equal to any unfunded Interest Requirement for the Senior Bonds for any prior month and, at the written direction of a Borrower’s Representative, to the holder of any Senior Parity Indebtedness an amount, as certified by a Borrower’s Representative, equal to the interest due in such month, together with an amount, as certified by a Borrower’s Representative, equal to any unfunded interest for any prior month;

(2) To the Principal Account for the Senior Bonds, an amount equal to the Principal Requirement for the Senior Bonds for that calendar month, together with an amount equal to any unfunded Principal Requirement for the Senior Bonds from any prior month and, at the written direction of a Borrower’s Representative, to the holder of any Senior Parity Indebtedness an amount, as certified by a Borrower’s Representative, equal to the principal due in such month, together with an amount equal to any unfunded principal for any prior month;

(3) To the Debt Service Reserve Account for the Senior Bonds, the amount if any, required to be paid into the Debt Service Reserve Account for the Senior Bonds pursuant to the Loan Agreement to restore the amount on deposit therein to the Debt Service Reserve Requirement;

(4) To the Interest Account for the Subordinate Bonds, the Interest Requirement for the Subordinate Bonds for that calendar month, together with an amount equal to any unfunded Interest Requirement for the Subordinate Bonds for any prior month and, to the holder of any Subordinate Parity Indebtedness, an amount equal to the interest due in such month, together with an amount equal to any unfunded interest for any prior month;

(5) To the Principal Account for the Subordinate Bonds, an amount equal to the Principal Requirement for the Subordinate Bonds for that calendar month, together with an amount equal to any unfunded Principal Requirement for the Subordinate Bonds from any prior month and, to the holder of any Subordinate Parity Indebtedness, an amount equal to the principal due in such month, together with an amount equal to any unfunded principal for any prior month;

(6) To the Debt Service Reserve Account for the Subordinate Bonds, the amount if any, required to be paid into such account pursuant to the Loan Agreement to restore the amounts on deposit therein to the Debt Service Reserve Requirement for the Subordinate Bonds;

(7) Subject to the provisions under the heading “Insurance and Tax Escrow Fund,” for transfer to the Insurance and Tax Escrow Fund, an amount equal to one-twelfth of the amount set forth by the Borrower in the Budget for the current year for annual premiums for insurance required to be maintained pursuant to the Loan Agreement and for annual real estate taxes (if any), or other charges for governmental services for the current year, as provided in the Budget, provided that distribution by the Trustee to the Insurance and Tax Escrow Fund in respect of the first date or dates on which premiums for insurance and taxes or other payments described above are payable

will be made in amounts equal to the respective quotients obtained by dividing the sum of (i) the amount of such premiums and (ii) the amount of such taxes or other charges, by the respective number of months, including the month of computation, to and including the month prior to the month in which such premiums or taxes are payable;

(8) To the Operating Fund, an amount equal to such month’s Operating Requirement, as provided in the Budget, together with such additional Operating Expenses requested in writing by a Borrower’s Representative pursuant to and after satisfaction of the conditions specified in the Loan Agreement;

(9) Subject to the provisions under the heading “Repair and Replacement Fund,” for transfer to the Repair and Replacement Fund, commencing with the month of April 1, 2017, an amount equal to the one-twelfth of the Replacement Reserve Requirement;

(10) Subject to the provisions under the heading “Administration Fund,” for transfer to the Administration Fund, an amount equal to one-sixth (1/6) of the Administration Expenses scheduled to be due and payable on or before the next succeeding Interest Payment Date;

(11) To the Rebate Fund, to the extent of any deposit required to be made thereto pursuant to the Tax Agreement;

(12) To the Manager, the Management Fee; and

(13) To the Surplus Fund, all remaining amounts.

In the event that, for any month, there are insufficient funds in the Revenue Fund to fund any one or more of the uses set forth in clauses (1) through (12) above, the amount not funded in such month due to such insufficiency of revenues shall be added to the amount to be funded in subsequent months under the same clause until such amount has been in fact funded. Failure to deposit sufficient Project Revenues to make the deposits described above shall not, in itself, constitute an Event of Default under the Indenture.

Debt Service Reserve Fund

A Debt Service Reserve Fund with separate accounts for the Senior Bonds and the Subordinate Bonds will be established under the Indenture. The Debt Service Reserve Fund will be funded in the aggregate amount of one- half of the Maximum Annual Debt Service for the Bonds. Amounts on deposit in each account of the Debt Service Reserve Fund will be used solely to pay the principal of and interest on the applicable Series of Bonds secured thereby when due to the extent moneys on deposit in the related Principal Account or Interest Account are insufficient therefor after the transfer of any amounts from the Surplus Fund and the Repair and Replacement Fund pursuant to the Indenture.

Amounts on deposit in the applicable Debt Service Reserve Accounts will be transferred to the applicable Principal Accounts of the Bond Fund at the written direction of the Borrower’s Representative for the purpose of paying the last maturing principal of the Senior Bonds or Subordinate Bonds, as applicable, on a Principal Payment Date or, if all of a series of the Bonds are being redeemed, to the applicable Special Redemption Accounts of the Bond Fund for redemption of Bonds; provided, however, that amounts may be transferred from the Debt Service Reserve Account for the Senior Bonds only in connection with shortfalls on the Senior Bonds and amounts may be transferred from the Debt Service Reserve Account for the Subordinate Bonds only in connection with shortfalls on the Subordinate Bonds.

If the amount on deposit in an Account of the Debt Service Reserve Fund for any Series of Bonds is less than the applicable Debt Service Reserve Requirement, the Borrower is required to pay the Trustee the amount of such deficiency to the extent of available Project Revenues and in accordance with the operation of the Revenue Fund. In addition, if the amount on deposit in an account of the Debt Service Reserve Fund is less than the applicable Debt Service Reserve Requirement for the series of Bonds secured thereby, investment earnings thereon

will remain in such account. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Trust Indenture” in Appendix B hereto.

Repair and Replacement Fund

A Repair and Replacement Fund will be established under the Indenture. The Repair and Replacement Fund will be funded from monthly deposits from the Revenue Fund initially in the amount of $300 per unit per year, subject to revision as described in the Loan Agreement. The Trustee may disburse money on deposit in the Repair and Replacement Fund, upon request of a Borrower’s Representative, no more than once a month to pay to or to reimburse the Borrower for paying the cost of replacements or items of repairs which may be required to keep the Project in sound condition, including, but not limited to, replacement of equipment, repair or replacement of any roof or other structural component of the Projects, exterior painting and major repairs to or replacement of heating, air conditioning, plumbing and electrical systems not properly payable from the Revenue Fund, but in any case, only if there are no funds available in the Project Fund for such purpose. The Repair and Replacement Fund shall also be used to remedy any deficiency in the accounts of the Bond Fund, on any Interest Payment Date after exhaustion of the Surplus Fund, in the same order of priority as provided for regular transfers from the Revenue Fund. If total amounts on deposit in the Repair and Replacement Fund are not sufficient to pay all of such repair and replacement costs when due then the Borrower is required to pay the deficiency, to the extent moneys are available in the Revenue Fund, and may be reimbursed from funds which later become available in the Repair and Replacement Fund. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Trust Indenture” in Appendix B hereto.

Surplus Fund

The Trustee shall deposit, into the Surplus Fund, amounts provided under the section “Revenue Fund” and any other amounts delivered to it with written instructions to deposit the same in the Surplus Fund. Money in the Surplus Fund shall be applied each month, when needed, for the following purposes and in the following manner:

(1) transferred to the Interest Account for the Senior Bonds to pay interest on the Senior Bonds to the extent amounts on deposit in such Interest Account are insufficient therefor;

(2) transferred to a Principal Account for the Senior Bonds to pay principal on the Senior Bonds to the extent amounts on deposit in such Principal Account are insufficient therefor;

(3) transferred to the Interest Account for the Subordinate Bonds to pay interest on the Subordinate Bonds to the extent amounts on deposit in such Interest Account are insufficient therefor;

(4) transferred to the Principal Account for the Subordinate Bonds to pay principal on the Subordinate Bonds to the extent amounts on deposit in such Principal Account are insufficient therefor;

(5) transferred to the Revenue Fund to the extent of any deficiency in the amounts needed to fully make all transfers from the Revenue Fund pursuant to the section “Revenue Fund” (other than to the Surplus Fund);

(6) transferred to or upon the direction of the Borrower’s Representative for deposit into the Operating Account for the payment of Operating Expenses when the Borrower’s Representative certifies to the Trustee that there are not sufficient money in the Operating Fund or the Operating Account to pay Operating Expenses;

(7) paid to the Trustee an amount equal to Extraordinary Trustee’s Fees and Expenses then due; and

(8) pay any unpaid and due Administrative Expenses.

If on or after any Annual Evaluation Date, the Trustee receives a certificate signed by the Borrower’s Representative stating that the Borrower has satisfied the Coverage Test for the Fiscal Year ending on such Annual Evaluation Date, upon which the Trustee may conclusively rely, no Event of Default, or event which with the passage of time or the giving of notice or both would constitute an Event of Default, has occurred and is continuing, the Debt Service Reserve Requirement and the required Repair and Replacement Fund have been fully funded, and the Borrower is in compliance with the Liquidity Requirement (as defined in the Indenture) then within two Business Days after written request by the Borrower’s Representative to the Trustee, the Trustee shall disburse all remaining cash in the Surplus Fund to the Borrower in the amount to each Borrower as indicated in such request.

Other Funds

In addition to the Funds described above, the Indenture also provides for a Bond Fund, a Project Fund, an Operating Fund, a Rebate Fund and an Administration Fund. The purposes of such funds and the specific requirements related to each are described in “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Trust Indenture” in Appendix B hereto.

No Credit Enhancement Facility

THERE IS NO CREDIT ENHANCEMENT FACILITY SECURING ANY OF THE BONDS NOR IS THERE ANY PROVISION FOR A CREDIT ENHANCEMENT FACILITY EVER TO BE PROVIDED TO SECURE ANY OF THE BONDS.

Other Covenants of the Borrower

Under the Loan Agreement, the Mortgage and the Land Use Restriction Agreement, the Borrower is required to comply with certain other covenants and agreements. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Loan Agreement,” “—The Mortgage” and “— The Land Use Restriction Agreement” in Appendix B hereto.

Relationship Among Series

Under the Indenture, amounts deposited in the Revenue Fund (after all other required applications) will be applied to the payment of the Senior Bonds prior to the payment of the Subordinate Bonds. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Indenture; Revenue Fund” in Appendix B hereto. Consequently, revenues will not be deposited equally towards the payment of interest and principal on each Series of Bonds. Amounts on deposit in the accounts of the Bond Fund for a Series of Bonds will be used solely to pay principal and interest on that Series of Bonds, on the applicable payment dates. If there is a shortfall of revenues, interest and principal on the Senior Bonds must be paid prior to any such payments being made with respect to the Subordinate Bonds. Under such circumstances, principal and/or interest on the Subordinate Bonds may remain unpaid.

Pursuant to the Indenture, while any Senior Bonds are outstanding, failure to pay an installment of interest on any of the Senior Bonds when such interest becomes due and payable and failure to pay the principal of, or premium, if any, on any of the Senior Bonds when such becomes due and payable, whether at maturity, by proceedings for redemption, by declaration or otherwise constitutes an Event of Default. While any Senior Bonds are outstanding, a failure to make any debt service payments on the Subordinate Bonds does not constitute a Default or an Event of Default under the Indenture. If no Senior Bonds are outstanding, failure to pay an installment of interest on any of the Subordinate Bonds when such interest becomes due and payable and failure to pay the principal of, or premium, if any, on any of the Subordinate Bonds when such becomes due and payable, whether at maturity, by proceedings for redemption, by declaration or otherwise constitutes an Event of Default. A FAILURE TO PAY PRINCIPAL OR INTEREST ON THE SUBORDINATE BONDS WILL NOT CONSTITUTE AN EVENT OF DEFAULT AS LONG AS THE SENIOR BONDS ARE OUTSTANDING. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Indenture; Revenue Fund” and “— The Indenture; Defaults and Remedies” in Appendix B hereto.

THE SERIES 2017B BONDS ARE SUBORDINATE IN RIGHT OF PAYMENT, SECURITY AND PRIORITY TO THE SERIES 2017A BONDS.

Issuance of Additional Bonds

So long as no Event of Default has then occurred and is continuing, the Authority at the request of a Borrower’s Representative may, but shall not be required to, issue Additional Bonds for the purpose of (i) financing the costs of making such Modifications as the Borrower may deem necessary or desirable, (ii) financing the cost of completing any Modifications, (iii) refunding any Bonds, and (iv) in each such case, paying the costs of the issuance and sale of the Additional Bonds, paying capitalized or funded interest and such other costs reasonably related to the financing as shall be agreed upon by the Borrower and the Authority. As a condition for the issuance of Additional Bonds, (i) such Additional Bonds shall be rated in a rating category that is not lower than the underlying rating (i.e., the rating of the respective Outstanding Bonds without giving effect to any credit enhancement) of the Series of Bonds of the same parity as such Additional Bonds, and (ii) prior to the issuance of such Additional Bonds, the Rating Agency then rating the Outstanding Bonds shall deliver a Confirmation of Rating stating that the issuance of the Additional Bonds will not result in a qualification, downgrade or withdrawal of the then current ratings on the Bonds.

THE AUTHORITY

Organization

The Authority is a political subdivision of the State, organized under the provisions of the Act. The purpose of the Authority is to assist in financing authorized projects in the State as enumerated in the Act, which include facilities of organizations such as the Borrower operating under Section 501(c)(3) of the Internal Revenue Code. In furtherance of its authorized powers and functions, the Authority has the power, by virtue of the Act, to issue the Series 2017 Bonds, to loan the proceeds thereof to the Borrower and to secure the Series 2017 Bonds by a pledge of the amounts payable by the Borrower under the Loan Agreement. The Authority is governed by a Board of Directors, whose membership is limited to those representatives of those Participating Political Subdivisions whose governing authorities have adopted a resolution indicating their intention to participate in the Authority. Each Participating Subdivision may appoint a Director in accordance with the Act. Directors are appointed for two (2) year terms and may be removed for just cause by the Board of Directors. Officers of the Authority are elected by and from the ranks of the members of the Board of Directors and consist of a Chairman, Vice-Chairman and Secretary-Treasurer. Officers serve one (1) year terms and may not be re-elected for successive terms in any one office; however, officers may be elected to another office.

Pursuant to the Authority’s by-laws, the Board of Directors has established an Executive Committee and, in accordance with the Act, delegated certain duties and authorities to the Executive Committee. The Executive Committee consists of seven members, three of whom are the officers of the Authority who serve as ex-officio members for as long as they remain officers of the Board of Directors. The remaining four (4) at large members are elected at an annual meeting of the Board of Directors and serve as at-large members with one member elected for a term of one (1) year, one member elected for a term of two (2) years, one member elected for a term of three (3) years and one member elected for a term of four (4) years. An at-large member may not be re-elected to the Executive Committee as an at-large member and his successor shall be elected for a four (4) year term. The Executive Committee is required to make an annual report to the Board of Directors at its annual meeting. Provision is made in the by-laws to make the minutes of all Executive Committee meetings available to members of the Board of Directors.

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The current members of the Executive Committee, their positions, terms of office and respective Participating Political Subdivision are as follows:

Present Committee Term Participating Members Position Expires Political Subdivision

The address of the Authority is 5420 Corporate Blvd, Suite 205, Baton Rouge, LA 70808.

The Executive Director of the Authority is Ty E. Carlos. Mr. Carlos received his degree in finance from Louisiana State University. He previously worked as Vice President and Sales Executive for The Bank of New York Mellon Trust Company, N.A. He has service as Executive Director of the Authority since April, 2014.

THE BORROWER AND THE PROJECT

The following information has been provided by the Borrower. None of the Authority, the Trustee or the Underwriter have made any independent investigation regarding the information presented under this heading, nor have such parties verified the accuracy or completeness thereof, and none of the Authority, the Trustee or the Underwriter nor any of their respective counsel, members, officers, or employees assumes any responsibility or liability therefor.

The Borrower

2016 AVHG Cove, LLC, a Louisiana limited liability company (the “Borrower”), is a newly created single asset entity. The Borrower has no officers, directors or managers, and is governed by the hereinafter defined Sole Member. By operation of law, the Borrower is a disregarded entity for federal income tax purposes and, as such, it takes the tax status of its sole member, Invest in America’s Veterans Foundation, Inc. (the “Sole Member”), which is tax-exempt as an organization described in Section 501(c)(3) of the Code. The Borrower has no operating history and has no financial statements.

The Borrower does not intend to acquire any substantial assets or engage in any substantial business activities other than those related to the ownership and management of the Project and the Borrower is required to be a single asset/sole purpose entity by the Loan Agreement. However, the Sole Member and other affiliated entities may engage in the acquisition, development, ownership, leasing and management of similar types of housing projects.

None of the officers, members or employees of the Borrower or the Sole Member will be personally liable for payments on the Note. Furthermore, no representation is made that the Borrower will have substantial funds to meet operating deficits of the Project should they occur. Accordingly, neither the Borrower’s financial statements nor those of the Sole Member are included in this Official Statement.

The Sole Member

The Sole Member is a Florida nonprofit corporation formed on February 2, 2009 for the purpose of assisting veterans with housing, employment, career counseling, education and other services related to veteran’s affairs and to operate the Southwest Florida Military Museum & Library. The Sole Member has received a

determination letter from the IRS dated May, 2010 for its tax-exempt status as an organization described in Section 501(c)(3) of the Code. IRS correspondence dated July 15, 2014 (the “Determination Letter”) to the Sole Member confirmed that the Sole Member is described in section(s) 509(a)(1) and 170(b)(1)(A)(vi) to the effect that the Sole Member can reasonably be expected to be a publicly supported organization described in Section 509(a)(2) of the Code and not a private foundation.

The American Veterans Housing Group, LLC (“AVHG”) is the Foundation’s real estate operating group. Principles of AVHG have approximately 35 years of experience operating in the housing sector. AVHG currently has 2,261 units of multifamily housing under contract that will be closing over the coming months. AVHG manages one of the largest HUD-VASH housing initiatives in the country. AVHG is currently active in 12 states with a program portfolio in excess of 12,000 units of multifamily housing either direct ownership, joint venture or support services agreement.

Board of Directors. The Sole Member is governed by a Board of Directors, which currently consists of three members. The following are brief resumes of the directors of the Sole Member:

Ralph Santillo, Founder and President.

Mr. Santillo created the Foundation in 2009. In addition to providing services directly to, and working directly with, individual veterans, he and the Foundation are active in many veterans’ organizations, helping veterans of all ages to help themselves to better their lives and their families. Some of these organizations include:

• Veterans of Foreign Wars (VFW) • Disabled American Veterans (DAV) • American Veterans (AmVets) • American Legion

Mr. Santillo has been involved in a number of retail, wholesale and manufacturing businesses since the age of 18 and has frequently been active in more than one job or business at a time. Over the years he maintained an interest in real estate and/or construction businesses and has been involved in several real estate investment and development opportunities. Through these 50 years of experience, he has acquired extensive expertise in the areas of promotion and marketing, as well as extraordinary insight when evaluating current conditions, trends and needs, and translating that insight to workable solutions and services.

Mr. Santillo has produced and performed at hundreds of seminars and educational workshops delivered to thousands of people. A number of his educational seminars have recently been directed to veterans to address their unique housing, loan, educational and business opportunities.

Judy Petrulavage, Founder and Vice President.

Judy Petrulavage has had several roles in business, ranging from working in a candle shop to managing the electronics department in a photo lab. She was employed from 1978 - 1991 in the Missile Systems division at Raytheon. She worked her way up from entry level to Head Assembly Line Leader and served as Trainer for all line employees and for other countries who bought the systems.

Ms. Petrulavage has been affiliated with the Foundation as one of the early Founders in 2010. In her role as Vice President, she works 40 – 50 hours a week overseeing much of the Foundation’s operations.

In addition to providing services directly to, and working directly with, individual Veterans, she is active in many veterans’ organizations, helping veterans of all ages to help themselves to better their lives and their families. Some of these organizations include:

• Veterans of Foreign Wars (VFW) • Disabled American Veterans (DAV) • American Veterans (AmVets)

Nicholas A. Napolitano Jr., Secretary/Treasurer.

Mr. Napolitano has been affiliated with the Foundation since 2010 and became a current board member in January 2012. As the Foundation’s Secretary/Treasurer, Nick’s duties include - Collecting all donations, Accounting for all Foundation receivable/payable accounts and expenditures, coordinating the pick-up of furniture and various other items being donated to the foundation, and coordinating court ordered community service personnel with the Lee County Sheriff’s Department.

Mr. Napolitano is a fully certified Veteran Service Officer (VSO), and as such, has assisted hundreds of veterans and their families. Some of his areas of expertise include - assisting with filing paperwork with the Department of Veterans Administration (VA), supporting homeless veterans with applications to the HUD/VASH program, and researching and obtaining military records. He is also very well versed in job placement, and even assist the general community with applying for food stamps and social security benefits.

Mr. Napolitano currently serves as the Commander of AMVETS Post 65 (FL), Finance Officer of American Legion Post 90 (FL), and is the past President of the Korean War Veterans Chapter 155 (FL).

Mr. Napolitano has a successful business background, including a position in charge of finances with a textile business and A & R (Artist and Repertoire) Administrator with a major recording label. He also held the position of Director of Energy Programs for the city of New York. In that role he managed and directed the operation of Central Office Administrative Units, acted as personnel liaison, managed and accounted for program funds through the direct supervision of the grant payment process, coordinated the development and maintenance of agency relationships with utility companies and fuel vendors. He also oversaw the issuance of timely HEAP regular and emergency benefits to clients and/or vendors and directed the benefit fund recoupment process in case of duplicate inappropriate payments.

The Project

The Project is an existing 300-unit multifamily residential rental housing facility located on approximately 11.47 acres at 10501 Curran Boulevard, New Orleans, Louisiana 70127. The Project contains 20 three-story apartment buildings and three one-story accessory buildings and was originally constructed in 1987 and renovated in 2014. The net rentable area is approximately 280,200 square feet. The construction is wood frame with vinyl siding on a concrete slab. The Project is currently located within zone “S-RM2: Suburban Multi-Family Residential District”, which is a confirming land use and construction type within the designated municipal zone.

The table below sets forth the current unit mix and current gross potential rental income for the Project.

Total Unit Mix # of Units Square Footage Square Footage Contract Rent 1x1 103 680 70,040 $661 1x1 17 680 11,560 $763 2x2 105 1,050 110,250 $825 2x2 27 1,050 28,350 $953 3x2 40 1,250 50,000 $41 3x2 8 1,250 10,000 $1,091 Total 300 934 280,200 $799

Surrounding Community

The City of New Orleans is coterminous with Orleans Parish which is located in the southeast portion of Louisiana. The nearest city with a population over 1,000,000 is Houston, Texas, which is approximately 320 miles west. The nearest cities are Arabi, Louisiana; Gretna, Louisiana; Terrytown, Louisiana; Harvey, Louisiana; Jefferson, Louisiana; Chalmette, Louisiana; Timberlane, Louisiana; and Marrero, Louisiana.

The Project is immediately bordered by multifamily dwellings, commercial properties, single-family residences and vacant land. Several health care and medical facilities serve the residents of the City, Interstates 10, 49, 510, 610, and U.S. Highways 11, 61, and 90 bisect the City and New Orleans International Airport is approximately 22 miles or a 30 minute drive from the Project. The neighborhood in which the Project is located is comprised primarily of residential and commercial properties.

Additional information concerning the Project and the New Orleans, Louisiana, metropolitan area is contained in the Appraisal, a summary of which is included herein. The summary of the Appraisal does not purport to be complete or definitive and is qualified only in its entirety by reference to the full Appraisal attached as Appendix G. See “APPRAISAL” herein.

Occupancy

The Borrower expects physical occupancy to be at least 95% in each year. The physical occupancy rate is the proportion of units that are occupied by tenants. The economic occupancy rate is the proportion of the gross potential rent that is collected. As such, economic occupancy takes into consideration items such as model units, employee units, discounted units, rent incentives, loss to lease and bed debt expense. The table below sets forth the physical occupancy and economic occupancy of the Project for the fiscal years ending December 31 of each year.

The Cove at NOLA Apartments – Historical Occupancy 12/31/2016 12/31/2015 12/31/2014 12/31/2013 Physical Occupancy 95% 95% 95% 97% Economic Occupancy 92% 89% 90% 94%

As of February 24, 2017, the physical occupancy is 97%.

Project Regulation

General. The Project is required to be operated in accordance with the terms of the Land Use Restriction Agreement, which requires that the Project be maintained as a residential rental housing facility within the meaning of Section 142(d) of the Code and the Treasury Regulations thereunder, and that during the Qualified Project Period (as defined in the Regulatory Agreement) with respect to the Property at least 40% of the completed units in the Project be occupied by families or individuals whose income does not exceed 60% of the median income for the area in which the Project is located (with adjustments for family size). The Tax Agreement further imposes certain requirements relating to the 501(c)(3) tax-exempt status of the Sole Member, including the requirement that 75% of the dwelling units in the Project be occupied by persons whose adjusted gross income does not exceed 80% (adjusted for family size) of the area median gross income, which is the New Orleans, Louisiana MSA. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Land Use Restriction Agreement” in Appendix B hereto.

The Land Use Restriction Agreement further requires that the Project be offered for rental to the general public, prohibits rental of certain units to persons related to the Borrower and rentals on a transient basis, and imposes other restrictions on the operation of the Project (as defined in the Land Use Restriction Agreement, the “Rental Restrictions”). These conditions and restrictions may continue in effect upon a sale or foreclosure or a deed in lieu of foreclosure under the Mortgage and could adversely affect the value of the Project to a prospective purchaser in the event of a sale or foreclosure or a deed in lieu of foreclosure. In addition, failure by the Borrower to operate the Project in compliance with the provisions of the Land Use Restriction Agreement could cause interest on the Bonds to be subject to federal income taxation, possibly retroactive to the date of issuance of the Bonds. See “RISK FACTORS AND INVESTMENT CONSIDERATIONS – Project Risks – Rental Housing Requirements.” And “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Land Use Restriction Agreement” in Appendix B hereto.

Insurance

Under the Loan Agreement, the Borrower is required to keep and maintain the Project insured and paying, or causing to be paid, as the same become due and payable, all premiums with respect thereto. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Loan Agreement” in Appendix B hereto.

The Federal Flood Disaster Protection Act of 1973 requires flood insurance on improved real estate or a mobile/manufactured home and/or its contents if such property serves as collateral for a loan or line of credit and is located, or to be located, in a Special Flood Hazard Area (“SFHA”). Designating and publishing information about these SFHA areas is the responsibility of the Federal Emergency Management Agency (“FEMA”). As of October 2016, the most recent FEMA flood map revision shows that the Project is no longer in a SFHA and flood insurance is no longer required due to the FEMA map change. Nevertheless, the Borrower will procure flood insurance, but at a discounted rate.

Prior Operating History

The Seller has provided unaudited financial statements for the Project for the fiscal year ended December 31, 2016. See “Appendix E” herein. The Underwriter makes no representations as to the accuracy or completeness of such financial statements. No assurance can be given that the prior operating revenues from the Project or Operating Expenses of the Project as set for in these audited financial statements will be consistent with those historically experienced. Certain expenses incurred by the Seller may not be incurred by the Borrower, and the Borrower may incur expenses that were not incurred by the Seller.

The Property Manager

The Borrower will enter into a Property Management Agreement with The Lynd Company (the “Property Manager”). The Property Manager was founded in 1980 and currently manages 35,000 multifamily units in 16 different states. The Property Manager currently manages the Project. Pursuant to the Property Management Agreement, the Property Manager will be the exclusive agent for the management of the Project subject to such agreement, including marketing, rental activities, collection of rents, enforcement of leases, maintenance and repair of such Project, provision of utilities and services, and for obtaining and keeping in effect all insurance policies with respect to such Project. Under the Property Management Agreement, the Property Manager will be paid a monthly fee. The initial monthly fee will be equal to approximately four percent (4.00%) of effective gross income for the Project. According to the Loan Agreement, no Person shall be engaged by the Borrower as a replacement manager unless such Person or a principal officer (or in the case of a limited liability company, manager) thereof (a) shall have at least five years of demonstrated experience in the management and leasing of affordable residential rental housing facilities, including having (or in the case of such officer or manager, overseeing) not less than 500 units under management subject to restrictions similar to those contained in the Land Use Restriction Agreements and (b) have its employees bonded for not less than the $500,000.

The following table is a list of multifamily residential rental housing properties managed by the Property Manager:

The Lynd Company – Multifamily Housing Portfolio Property Name Location # of Units The Cove at NOLA Apartments New Orleans, Louisiana 300 2100 Memorial Houston, Texas 197 Autumn Oaks Apartments San Antonio, Texas 114 Avalon Apartments Los Angeles, California 15 Beauvoir Manor Apartments Biloxi, Mississippi 150 Bent Creek Apartments Atlanta, Georgia 324 Berkley Apartments Little Rock, Arkansas 252 Berrendo Square Apartments San Antonio, Texas 100 Beverly Oaks Apartments San Antonio, Texas 183 Briar Creek Apartments Houston, Texas 88

The Lynd Company – Multifamily Housing Portfolio Property Name Location # of Units Briarcrest Apartments Spring, Texas 376 Brightwaters Apartments Little Rock, Arkansas 256 Brookhollow Apartments Kerrville, Texas 48 Canlen West Apartments San Antonio, Texas 132 Caswyck Trail Apartments Marietta, Georgia 403 Cedars of Baymeadows Jacksonville, Florida 160 Celina Plaza El Paso, Texas 289 Center Park Apartments San Antonio, Texas 395 Marshall Meadows San Antonio, Texas 250 Mission Del Rio San Antonio, Texas 180 Port Royal San Antonio, Texas 252 Pecan Grove Dallas, Texas 250 Townhomes Green Houston, Texas 238 CR Claremore Claremore, Oklahoma 104 CR Gallatin Gallatin, Tennessee 208 CR Jackson Jackson, Mississippi 144 CR Jackson Jackson, Tennessee 124 CR North Little Rock Little Rock, Arkansas 172 CR of Tinker Oklahoma City, Oklahoma 152 CR of Yukon Yukon, Oklahoma 200 CR Richland Richland, Mississippi 184 CR Sherwood Sherwood, Arkansas 160 CR Springdale Bethel Heights, Arkansas 184 Chenal Lakes Apartments Little Rock, Arkansas 456 Cheyenne Village Apartments San Antonio, Texas 60 Chisolm Trace Apartments San Antonio, Texas 126 Cielo Vista Apartments El Paso, Texas 378 Cinnamon Creek Apartments San Antonio, Texas 278 City Parc II West Oaks Apartments Houston, Texas 192 Cleme Manor Houston, Texas 284 Clippers Cove Boynton Beach, Florida 384 Clover Hill Apartments Arlington, Texas 216 Cobb Park Townhomes Fort Worth, Texas 172 Colonial Villas Apartments Texarkana, Texas 196 Concord at Gulfgate Houston, Texas 288 Concord at LittleYork Houston, Texas 276 Concord at Williamcrest Houston, Texas 288 Continental Apartments San Antonio, Texas 251 Copper Creek Apartments Abilene, Texas 228 Creek Hollow Apartments Fort Worth, Texas 120 Crossroads at Cooks Meadow Fort Worth, Texas 292 Crown Ridge of Edmond Edmond, Oklahoma 160 Dublin Apartments San Antonio, Texas 156 Dymaxion Apartments San Antonio, Texas 190 Emerald Bay Houston, Texas 248 Encinal Apartments San Antonio, Texas 312 Fairfield Apartments Little Rock, Apartments 337 Forest Hills Apartments Garner, North Carolina 136 Forest River Apartments Gadsden, Alabama 248 Fowler Square Apartments Little Rock, Arkansas 88 Fredericksburg Place San Antonio, Texas 159 Fulton Village Houston, Texas 108 Golf Villas Gulf Breeze, Florida 136 Greenview Gardens Apartments Butler, Pennsylvania 137

The Lynd Company – Multifamily Housing Portfolio Property Name Location # of Units Greenview Manor St. Petersburg, Florida 52 Grove at Trinity Mills Dallas, Texas 320 Heatherbrook Apartments Houston, Texas 176 Heritage Square Apartments Dallas, Texas 112 Heritage Square Apartments Edinburg, Texas 204 Highland Ridge Overland Park, Kansas 370 Highlands Apartments Dallas, Texas 136 Hillcrest Apartments Grand Prairie, Texas 310 Historic at Allen Parkway Houston, Texas 500 Howell Bridge Apartments Duluth, Georgia 256 Huebner Oaks Apartments San Antonio, Texas 344 Ingram Ranch Apartments San Antonio, Texas 164 Ironwood Crossing Apartments Fort Worth, Texas 280 Jacob’s Crossing Magee, Mississippi 45 James Park St. Petersburg, Florida 82 Kingswood Manor Apartments San Antonio, Texas 129 Kitty Hawk Apartments Universal City, Texas 308 La Plaza Apartments El Paso, Texas 129 Lady Esther Apartments San Antonio, Texas 639 Lake Vista Warner Robbins, Georgia 234 Lakes at Indian Creek Clarkston, Georgia 603 Lakeside Villas Apartments Jackson, Mississippi 146 Las Colinas Apartments San Antonio, Texas 232 Las Villas de Merida San Antonio, Texas 160 Laurel Crossing Apartments San Antonio, Texas 112 Laurel Gardens Metairie, Louisiana 60 Le Chateau Lake Charles, Louisiana 200 Lodge of Overland Park Overland Park, Kansas 548 Long Beach Square Apartments Long Beach, Mississippi 100 Maple Ridge Apartments Overland Park, Kansas 156 Marbach Park Apartments San Antonio, Texas 304 Marianna Gardens Marianna, Florida 100 Meadow Creek Apartments Houston, Texas 192 Mill Creek Apartments Spring, Texas 174 Mitchell Village Apartments San Antonio, Texas 184 Mon Chateau Lafayette, Louisiana 80 Mountainside Apartments Jasper, Georgia 176 Nob Hill Apartments San Antonio, Texas 368 Oak Hills Apartments San Antonio, Texas 121 Oak Hollow Austin, Texas 409 Oak Park Village Lenexa, Kansas 511 Oaks at Brandlewood Savannah, Georgia 324 One Westfield Lake Spring, Texas 246 Palacio Del Sol San Antonio, Texas 222 Pan American Homes San Antonio, Texas 293 Park at Summerhill Texarkana, Texas 184 Park Victoria Apartments Kansas City, Kansas 144 Pebble Hills Apartments El Paso, Texas 104 Pepperidge Apartments San Antonio, Texas 144 Perrin Crest Apartments San Antonio, Texas 200 Perrin Square Apartments San Antonio, Texas 236 Pheasant Ridge Moline, Illinois 216 Pinhook South Apartments Lafayette, Louisiana 240 Pleasant Pointe Little Rock, Arkansas 239

The Lynd Company – Multifamily Housing Portfolio Property Name Location # of Units Portland Courtyard Los Angeles, California 46 Portofino Villas Melbourne, Florida 160 Raintree Senior Apartments St. Louis, Missouri 102 Rankin Square Pearl, Mississippi 120 Regents Center Apartments Overland Park, Kansas 424 Reserve at Pecan Valley San Antonio, Texas 412 River Mill Apartments Hudson, Florida 136 Riverview Apartments Tampa, Florida 296 Riverwalk II Apartments Homestead, Florida 112 Rush Creek Apartments Arlington, Texas 248 Sabine Park Orange, Texas 200 Shadow Ridge Apartments Houston, Texas 260 Shadowood Apartments Lake Charles, Louisiana 180 St. Luke’s Plaza St. Louis, Missouri 216 Stations at Richmond Hills Atlanta, Georgia 181 Stone Creek Apartments Tyler, Texas 248 Stone Ridge Apartments Arlington, Texas 204 Stonehouse Apartments San Antonio, Texas 248 Stratford Landing Tallahassee, Florida 192 Suffolk Manor Lake Charles, Louisiana 220 Summertree Valley View Apartments Little Rock, Arkansas 232 Sunset Bay Apartments Miami, Florida 308 Sweetwater Point Houston, Texas 260 Terraces and Highbury Apartments Atlanta, Georgia 172 The Forum at Grand Prairie Grand Prairie, Texas 304 The Preserve at Collier Ridge Atlanta, Georgia 419 The Regents Jacksonville, Florida 304 The Villages at Cable Ranch Apartments San Antonio, Texas 272 Thunderbird Apartments San Antonio, Texas 751 Timber Ridge Apartments San Antonio, Texas 168 Townhouse Apartments San Antonio, Texas 574 Trace Apartments Lake Charles, Louisiana 80 Travis Park Apartments Austin, Texas 199 Trinity Park Apartments St. Louis, Missouri 388 Tupelo Trace Tupelo, Mississippi 200 Valley Crossing Apartments Little Rock, Arkansas 211 Vantage at San Marcos San Marcos, Texas 240 Village Circle New Braunfels, Texas 50 Village Square Apartments Port Richey, Florida 92 Villages at Lost Creek San Antonio, Texas 260 Villas Winkler Houston, Texas 234 Vista Meadows San Antonio, Texas 574 Waterford Apartments San Antonio, Texas 133 Westchase Crossing Houston, Texas 366 Westgate Apartments Ocean Springs, Mississippi 90 Westridge Apartments Fort Worth, Texas 176 Willow Bend Apartments Lake Charles, Louisiana 105 Woodchase Apartments Gulfport, Mississippi 80 Woodland Heights Austin, Texas 288 Woodside Village Clarkston, Georgia 356 Wyncrest Clarkston Station Clarkston, Georgia 356 Wyndham Apartments Houston, Texas 448

The Asset Manager

Pursuant to an Asset Management Agreement dated as of February 1, 2017 (the “Asset Management Agreement”), Strategic Realty Capital, LLC (the “Asset Manager”) will be the exclusive agent for the operational oversight of the Project. The Asset Manager specializes in the acquisition and ownership of multifamily properties across the United States. The Asset Manager was established in 2008 and is based in Santa Monica, California. Pursuant to the Asset Management Agreement, the Asset Manager will provide the following services, among others: (a) work closely with third party property managers and leasing agents to provide direction for and oversight of business plans, budgets, forecasts, leases, analysis and approvals; (b) negotiate or review third party contracts; (c) manage cash flow, distribution analysis and investment projections; (d) develop and distribute periodic asset management reports to the Borrower and Sole Member; (e) provide insurance review for the Project specifically, assist the Borrower in surveying the insurable risks of the Project; (f) assist in retaining third party professionals to review existing assessed valuations for the Property for ad valorem taxes; (g) review proposed leases and coordinate with the Borrower and any third party property manager in the implementation of such leases; (g) assist the Borrower in evaluating the sufficiency and adequacy of any third party construction agreements and recommend proposed amendments to terms and conditions of such agreements; (h) review and procure from the third party management company on a monthly basis the Property’s financial performance and submit to the Borrower operating reports (which may be substantially the same as the reports generated by the property management company), including the preparation of an annual operating budget which is subject to final approval by the Borrower; (i) assist with the engagement of professional services including attorneys or other advisors in connection with the day to day operating of the Project; (j) assist the Borrower in evaluating the sufficiency and adequacy of the performance of the third party management company including the reserves, maintenance, staffing and make recommendations to the Borrower in such regard and (k) periodically assist the Borrower in performing an annual (or more frequent) inspection of the Property and make an evaluation and recommendation of required improvements or modifications to the Property.

Environmental Assessment

Gill Group, Inc. (“Gill Group”) prepared a Phase I Environmental Site Assessment Report for the Project (the “Environmental Assessment”). The Environmental Assessment for the Project is dated August 8, 2016. The Environmental Assessment was conducted utilizing the generally accepted Phase I industry standards using the American Society for Testing and Materials (ASTM) Standard Practice E 1527-13. During the initial offering period, the Environmental Assessment will be provided to any prospective purchaser upon request to the Underwriter. A summary of certain aspects of the Environmental Assessment follows. The following summary does not purport to be complete or definitive and is qualified in its entirety by reference to the full Environmental Assessment.

The Environmental Assessment revealed no evidence of recognized environmental conditions in connection with the Project, and Gill Group recommended no additional investigation at the time of the Environmental Assessment.

The Borrower is not aware of any enforcement actions currently in process with respect to any releases of pollutants or contaminants at the real property relating to the Project. However, there can be no assurance that an enforcement action or actions will not be instituted under such statutes at a future date. In the event such enforcement actions were initiated, the Borrower could be liable for the costs of removing or otherwise treating pollutants or contaminants located at the real property relating to the Project. In addition, under applicable environmental statutes, in the event an enforcement action were initiated, a lien superior to the Trustee’s lien on behalf of the registered Owners of the Bonds could attach to the Project that would adversely affect the Trustee’s ability to realize value from the disposition of the mortgaged property upon sale or foreclosure. Furthermore, in determining whether to exercise any foreclosure sale rights with respect to the Project under the Indenture, the Trustee would need to take into account the potential liability of any owner of the Project, including an owner by foreclosure, for clean-up costs with respect to such pollutants and contaminants. See “RISK FACTORS AND INVESTMENT CONSIDERATIONS – Project Risks – Environmental Risks” herein.

Property Condition Assessment Report

On April 23, 2016, Gill Group, Inc. prepared a Property Condition Assessment Report (“PCR”) for the Cove at NOLA Apartments. The purpose of the PCR is to provide information to evaluate the condition of the subject property in order to facilitate completion of due diligence by the addressee. The purpose is accomplished by describing the primary systems and components of the subject property, identifying conspicuous defects or material deferred maintenance, and presenting an opinion of costs to remedy the observed conditions. In addition, the PCR identifies systems or components that are anticipated to reach the end of their expected useful life during the specified evaluation period and includes an opinion for future capital replacements. The PCR identified $2,800 in immediate and short-term repair needs. The PCR also noted that the Borrower needs to fund $300 per unit per year for capital replacement reserve items.

The Borrower expects to make the following renovations to the Cove at NOLA Apartments.

The Cove at NOLA Apartments – Scope of Rehabilitation Description of Work Cost Parking lot striping $2,700.00 Parking lot and concrete walkways - patchwork $27,300.00 Replace and (or) repair balconies and patios $50,000.00 Replace and (or) repair outdated HVAC systems $30,000.00 Replace and paint all exterior wood furnishings that have rot or other damages $44,000.00 Interior work – replace carpet and tile and community room upgrades $65,000.00 TOTAL $219,000.00

The Borrower intends to use a portion of the proceeds of the Bonds in the amount of approximately $219,000.00 to address the immediate, short-term, and long-term repair needs of the Project. See “ESTIMATED SOURCES AND USES OF FUNDS.” Prospective purchasers of the Bonds may obtain a copy of the PCR upon request to the Underwriter during the initial offering period for the Bonds. The preceding summary does not purport to be complete or definitive and is qualified in its entirety by reference to the full PCR.

Pro Forma Financial Projection

Attached as Appendix D hereto is a pro forma financial projection prepared by the Borrower setting forth an estimate of revenues and expenses for the Project for the 12 month period after the issuance of the Bonds, based upon results from January 1, 2016 to December 31, 2016, with adjustments related to changes in management, administrative costs associated with the Bonds and required deposits into the Repair and Replacement Fund. The proforma financial projection has not been examined or reviewed by an accountant and is not intended to and does not meet the requirements of the American Institute of Certified Public Accountants for prospective financial forecasts or projections. The Underwriter makes no representation for the accuracy of the financial projections.

There are no assurances that operating revenues will not be less than, or that Operating Expenses will not be greater than those listed in the projection, and it is reasonably expected that such expenses will increase during the term of the Bonds. In the event of increases in the Operating Expenses of the Project, the Borrower will be primarily dependent upon increases in Contract Rents/Tenant Rents in order to adequately operate and maintain the Project. See “RISK FACTORS AND INVESTMENT CONSIDERATIONS – Future Project Revenues and Expenses” herein.

Limitation on Obligations of the Borrower

The obligations of the Borrower under the Loan Agreement, the Note and the Mortgage are payable solely from Project Revenues and the Funds and Accounts created under the Indenture (except as specifically set forth therein), without recourse to the assets of any other person or entity, including any member of the Borrower. The Borrower’s obligations to make Loan Payments with respect to the Bonds are limited recourse obligations of the Borrower; as a result, holders of the Bonds will have recourse only to the Funds and Accounts created under the

Indenture (except as specifically set forth therein), the Project and the other equipment and personal property secured under the Mortgage to satisfy the obligations of the Borrower with respect to the Bonds. No other revenues or assets of the Borrower will be available for the payment of, or as security for, the Bonds. No representation is made that the Borrower will have funds available sufficient to make payments due pursuant to the Loan Agreement. Accordingly, neither the Borrower’s financial statements nor those of the members of the Borrower are included in this Official Statement.

APPRAISAL

The Appraiser was retained by the Borrower to prepare the Appraisal. The full Appraisal is attached as Appendix G. A summary of certain aspects of the Appraisal follows and does not purport to be complete or definitive and is qualified in its entirety by reference to the full Appraisal.

The Appraisal includes information regarding the procedures utilized in preparing the Appraisal and the underlying general assumptions and limiting conditions. The conclusions and much of the other information included in the Appraisal are based on the assumptions and rationale stated therein. In some instances the currently available information may be incomplete, may not necessarily disclose all material facts that might affect the Project, and, in any case, may change after the date of the Appraisal. Accordingly, the assumptions and other information in the Appraisal should be carefully evaluated by a prospective investor in the light of the circumstances then prevailing.

Appraisals, by their nature, are based on the judgment of the respective appraisers, represent only estimates of value and should not be relied upon as a measure of realizable value. The Appraisal is dated as of its date. There can be no assurance that information set forth therein continues to be accurate in all respects as of the date hereof. In any event, the accuracy of the Appraisal is dependent upon the occurrence of specified assumptions and other future events which cannot be assured, and therefore, the actual results achieved will vary from the forecasts, and the variation may be material.

Information taken from the Appraisal prepared by the Appraiser should be evaluated within the context of the related full narrative report. Information presented out of the context of the full narrative report may be misleading. There is no assurance that the “market values” set forth in the Appraisal would be realized in the event of the foreclosure or forced sale or disposition of the Project.

The Appraiser determined the estate (i) “as-is” “market value” via the sales comparison approach is $17,400,000, (ii) “as-is” “market value” via the income approach is $17,225,000, and (iii) final “as-is” “market value” is $17,225,000. Certain assumptions used in the Appraisal by the Appraiser include: (i) 7.50% cap rate, (ii) 8% vacancy loss, (iii) property insurance of $630 per unit (please note the Borrower has procured property insurance of $402 per unit), and (iv) real estate taxes of $565 per unit (please note the Borrower is exempt from real estate taxes).

See “RISK FACTORS AND INVESTMENT CONSIDERATIONS – Appraisal” herein.

RISK FACTORS AND INVESTMENT CONSIDERATIONS

AN INVESTMENT IN THE BONDS INVOLVES A SUBSTANTIAL DEGREE OF RISK. PROSPECTIVE PURCHASERS OF THE BONDS SHOULD CAREFULLY CONSIDER ALL POSSIBLE FACTORS WHICH MAY AFFECT THEIR INVESTMENT IN THE BONDS. IN ADDITION TO THE OTHER INFORMATION SET FORTH HEREIN, THE FOLLOWING LIST, WHILE NOT SETTING FORTH ALL THE FACTORS, CONTAINS SOME OF THE FACTORS THAT SHOULD BE CONSIDERED PRIOR TO PURCHASING THE BONDS.

In order to identify risk factors and make an informed investment decision, prospective investors should be thoroughly familiar with this entire Official Statement (including the Appendices hereto, the documents describing the transactions, the third party reports with respect to the Project and the documents relating to the formation and organization of the Borrower and the Sole Member) and review the actual documents summarized herein to make a

judgment as to whether the Bonds are an appropriate investment for the investor. Moreover, the order of presentation of the risk factors does not necessarily reflect the order of their importance.

Limited Obligations of Authority

THE BONDS AND THE INTEREST THEREON ARE SPECIAL, LIMITED OBLIGATIONS OF THE AUTHORITY PAYABLE SOLELY FROM THE TRUST ESTATE (OTHER THAN RESERVED RIGHTS). THE BONDS SHALL NOT BE DEEMED TO CONSTITUTE A DEBT OR LIABILITY OF THE STATE, THE CITY OR OF ANY POLITICAL SUBDIVISION THEREOF, WITHIN THE MEANING OF ANY STATE CONSTITUTIONAL PROVISION OR STATUTORY LIMITATION AND SHALL NOT CONSTITUTE A PLEDGE OF THE FAITH AND CREDIT OF THE STATE, THE CITY OR OF ANY POLITICAL SUBDIVISION THEREOF, BUT SHALL BE PAYABLE SOLELY FROM THE FUNDS PROVIDED FOR IN THE INDENTURE AND IN THE LOAN AGREEMENT. THE ISSUANCE OF THE BONDS SHALL NOT, DIRECTLY, INDIRECTLY OR CONTINGENTLY OBLIGATE THE STATE, THE CITY OR ANY POLITICAL SUBDIVISION THEREOF TO LEVY ANY TAXES OR TO MAKE ANY APPROPRIATION FOR THEIR PAYMENT. THE AUTHORITY HAS NO TAXING POWER. Limited Repayment Obligations of Borrower; Security for Repayment

The Borrower’s obligation to make Loan Payments with respect to the Bonds is a limited, nonrecourse obligation of the Borrower, and holders of the Bonds will have recourse only to the Project and the Project Revenues to satisfy the obligation of the Borrower with respect to the Bonds. There can be no assurance that such amounts will be sufficient to repay the Borrower’s obligations with respect to the Bonds. No other revenues or assets of the Borrower will be available for the payment of, or as security for, the Bonds. The security for the Bonds (subject to Permitted Encumbrances) will consist entirely of the Trust Estate. Prospects for uninterrupted payment of principal and interest on the Bonds in accordance with their terms are dependent upon the success of the Borrower in renovating and operating the Project to generate adequate cash flow to meet its obligations under the Loan Agreement and the Note.

The Borrower and Related Parties; Conflicts of Interest

The Borrower was organized in Louisiana for the sole purpose of acquiring and operating the Project. It has no assets other than the Project and the rights and revenues incident thereto and no intention to acquire other assets. The ability of the Borrower to pay and perform its obligations under the Loan Agreement and the Note will depend primarily upon the ability of the Project to generate sufficient revenues. The Borrower has limited resources and is dependent on its successful operation of the Project to meet its obligations under the foregoing documents. Under the terms of the Loan Agreement and State of Louisiana law relating to limited liability companies, the Sole Member is not liable for the debts or losses of the Borrower, nor is it obligated to contribute any funds to or on behalf of the Borrower, irrespective of whether the revenues of the Project are sufficient to pay Operating Expenses and debt service requirements with respect to the Bonds. The Sole Member and the Asset Manager have engaged in, and may continue to engage in, business for its own account, independently or with others, and whether or not in the vicinity of or in competition with the Project. As a result of other interests and activities, the Sole Member and the Asset Manager may have conflicts of interest with their respective roles in the Project, including conflicts in allocating their respective time and resources between the Project and other activities in which they are involved.

Future Project Revenues and Expenses

As noted herein, and except to the extent payable from investment income or, under certain circumstances, proceeds of casualty insurance or condemnation awards, principal of and premium, if any, and interest on the Bonds is payable solely from Project Revenues, which include payments from tenants and from the security provided by or pursuant to the Indenture, the Loan Agreement and the Mortgage. No representation or assurance is given or can be made that Project Revenues, as presently estimated or otherwise, will be realized by the Borrower, the Trustee, or by any other person in amounts sufficient, together with such other moneys available under the Indenture and pledged to the Bonds, to pay debt service on the Bonds when due and to make other payments necessary to meet the obligations of the Borrower. Future revenues and expenses of the Project are subject to conditions which may change.

The realization of Project Revenues from the Project by the Borrower generally is subject to, among other factors, federal and state policies affecting rental housing and the housing market generally, demand for multifamily rental housing, the capability of management of the Project, the nature and condition of the housing stock in the neighborhood in which the Project is located, future economic conditions and other conditions which are impossible to predict. Such conditions may include an inability of the Project management to control expenses during periods of inflation, changes in government involvement in and regulation of rental housing, changes in local real estate taxes and zoning restrictions, and competition from other sources of assisted or market-rate multifamily housing.

The payment of debt service on the Bonds is, among other things, dependent upon the Borrower’s ability to maintain occupancy of the Project, debt service requirements with respect to the Bonds and to fund necessary reserves as required under the Indenture. See “THE BORROWER AND THE PROJECT” herein for a description of the Project. Occupancy levels may also be affected by a variety of future events, including but not limited to failure of the Project to attract such tenants because of competition from other rental housing, changes in zoning restrictions, or development activities near the Project.

Subordinate Status of Series 2017B Bonds

The Series 2017B Bonds (also referred to as the Subordinate Bonds) are subordinate to the Senior Bonds as described herein and as set forth in the Indenture. Under the Indenture, amounts deposited in the Revenue Fund (after all other required applications) will be used to fund the accounts in the Bond Fund for payment of the Senior Bonds and the account in the Debt Service Reserve Fund for the Senior Bonds prior to funding the accounts in the Bond Fund and the account in the Debt Service Reserve Fund for payment of the Subordinate Bonds. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Indenture; Revenue Fund” in Appendix B hereto. Amounts on deposit in the Bond Fund for a particular Series of Bonds will be used solely to pay principal and interest on the related Series of Bonds, on the applicable payment dates. If there is a shortfall of revenues, deposits to the Bond Fund and the Debt Service Reserve Fund for the Senior Bonds must be made prior to any such deposits being made with respect to the Subordinate Bonds. Under such circumstances, principal and/or interest on the Subordinate Bonds may remain unpaid.

Risks of Real Estate Investment

General. Development, leasing and operation of real estate, such as the Project, involves certain risks, including the risk of adverse changes in general economic and local conditions, including the possible future oversupply and lagging demand for housing; adverse use of adjacent or neighboring real estate; community acceptance of the Project; changes in the cost of operation of the Project; difficulties or restrictions in the Borrower’s ability to raise rents charged; adverse weather and delays in rehabilitation; population decreases; uninsured losses; failure of residents to pay rent; operating deficits and mortgage foreclosure; lack of attractiveness of the property to residents; adverse changes in neighborhood values; and adverse changes in zoning laws, federal and local rent controls, other laws and regulations and real property tax rates. Such losses also include the possibility of fire or other casualty or condemnation. If the Project, or any parts of the Project, were uninhabitable during restoration after damage or destruction, the residence units or common areas affected would not be available during the period of restoration, which could adversely affect the ability of the Project to generate sufficient revenues to pay

debt service on the Bonds. Changes in general or local economic conditions and changes in interest rates and the availability of mortgage funding may render the sale or refinancing of the Project difficult or unattractive. These conditions may have an adverse effect on the demand for the Project as well as the market price received for the Project in the event of a sale or foreclosure of the Project. Many other factors may adversely affect the operation of facilities like the Project and cannot be determined at this time.

Risks of Competition, the Rental Market and Occupancy and Rental Rates. The Project may compete with other current and future multifamily housing developments in its market area, some of which may offer lower rents. It is difficult to assess the current and future demand for units of the Project or future rental rates. Therefore, there can be no assurance that the Project will achieve the occupancy levels or the rental rates necessary to cover debt service requirements.

Failure to Maintain Occupancy. The economic feasibility of the Project and its ability to provide revenues to the Borrower to make payments on the Note depend in large part upon its being substantially occupied. Occupancy of the Project may be affected by competition from existing competing facilities or from competing facilities which may be constructed in the area served by the Project, including new facilities which the Sole Member, or its affiliates, may construct. None of the participants in the Project have agreed to a covenant not to compete with the Project. Circumstances may occur, including but not limited to, insufficient demand for low income multifamily housing in the Project’s location, decreases in the population, deterioration of the structure and living facilities of the Project, and construction of competing projects for low income individuals or other more attractive living accommodations, which could increase the rate of vacancy. Further, the sustained failure of tenants to meet their rental payment obligations would make it difficult for the Project to meet its Operating Expenses which could result in a curtailment of essential services and decrease the desirability of the Project to existing or prospective tenants.

Damage, Destruction or Condemnation. Although the Borrower will be required to obtain and maintain certain insurance against damage or destruction as set forth in the Loan Agreement and the Mortgage, there can be no assurance that the Project will not suffer losses for which insurance cannot be or has not been obtained or that the amount of any such loss, or the period during which the Project cannot generate Project Revenues, will not exceed the coverage of such insurance policies.

If the Project or any portion of the Project is damaged or destroyed, or is taken in a condemnation proceeding, funds derived from proceeds of insurance or any such condemnation award for the Project must be applied as provided in the Loan Agreement to restore or rebuild the Project or to redeem the Bonds. There can be no assurance that the amount of funds available to restore or rebuild the Project or to redeem the Bonds will be sufficient for that purpose, or that any remaining portion of the Project will generate Project Revenues sufficient to pay the expenses of the Project and the debt service on the Bonds remaining outstanding.

Effect of Increases in Operating Expenses

It is impossible to predict future increases in Operating Expenses. An extended period of inflation may cause the rate of increases in Operating Expenses to rise more rapidly than the Borrower’s ability to raise rents. Conversely, an extended period of deflation may cause the Project’s rents to decrease more rapidly than any decrease in the Project’s Operating Expenses. In addition, any underestimation by the Borrower of the Operating Expenses of the Project may materially adversely affect sufficiency of the operating income of the Project.

Property reserves are an important consideration for replacing such items as kitchen appliances, heating and air conditioning systems, roofs and other major capital items to maintain the quality of the Project over time. The adequacy of the Project’s reserve funds will depend in part on the quality of workmanship performed during construction or rehabilitation and the longevity of mechanical equipment that was installed in the units. The deterioration and replacement of capital items is not predictable with certainty, and real estate properties such as the Project may encounter a periodic need for capital for replacement or repair of capital items in excess of property reserves on hand. The Borrower has obtained a capital needs assessment for the Project and a portion of the proceeds of the Bonds will be used to pay the costs of the improvements recommended by the capital needs assessment. See “THE BORROWER AND THE PROJECT—Property Condition Assessment Report” herein.

In the event that additional capital is needed for the replacement of capital items, since the Borrower has no other source of income other than the Project, it is likely that the Borrower will either have to seek additional debt financing from third-party lenders or pay for such capital replacement or improvement out of residual cash flow from the Project. The Authority has no obligation with respect to any operating, reserve or capital expenses of the Project and no obligation to issue additional bonds with respect to the Project.

To the extent there are any expenditures required to maintain the Project that are not foreseen by the Borrower, any uninsured losses are experienced, the only source of money to pay such expenses would be additional resources, if any, available to the Borrower. The Borrower may be unable or unwilling to pay for such additional expenditures.

Substantial increases in Operating Expenses would affect future net operating income of the Project and the ability of the Project to generate rental revenue in amounts sufficient to satisfy the Borrower’s obligations under the Loan Agreement and the Note. Any failure by the Borrower to satisfy its payment obligations under the Loan Agreement and the Note will have an adverse impact on the ability of the Trustee to pay, from the Trust Estate, debt service payments on the Bonds.

Project Risks

Adequacy of the Project as Security. The security for the Bonds includes a lien on the Project, evidenced by the Mortgage which has been granted in favor of the Trustee. If the Borrower fails to make sufficient and timely payments required under the Loan Agreement, it may be necessary for the Authority and the Trustee to exercise their remedies under the Mortgage or the Indenture, including foreclosure on the estate.

There can be no assurance that if and when the Trustee forecloses or otherwise obtains possession of the Project or realizes amounts from the sale of the interests thereof, that resulting proceeds or Project Revenues (if the Project is retained and operated by the Trustee), would be sufficient to pay debt service on the Bonds in full when due and Operating Expenses of the Project. See the subheading “– Appraisal” below for a description of risks associated with the Appraisal. The Trustee is not in the business of operating facilities such as the Project and any amounts which might be realized from operation of the Project are uncertain. Further, attempts to foreclose under the Mortgage or to obtain other remedies under such document, the Indenture, the Loan Agreement or any other documents relating to the Bonds may be met with protracted litigation and/or bankruptcy proceedings, which could cause delays, and a court may decide not to order specific performance of covenants contained in such documents. Thus, there can be no assurance that upon the occurrence of an event of default on the Bonds the Trustee will be able to obtain possession of the Project or generate proceeds of sale or revenues from the Project, or obtain other relief, in a timely fashion.

The Project is a Special Purpose Facility. The Project was constructed for multifamily residential rental housing purposes and is subject to physical restrictions that limit the alternative uses that can be made of such property. The Land Use Restriction Agreement and the Tax Credit Agreement also imposes significant restrictions on the use of the Project which could remain in effect, even in the event of foreclosure of the Mortgage. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Land Use Restriction Agreement” in Appendix B hereto. If the Borrower is unable to operate the Project successfully as a multifamily residential rental housing facility, the number of entities that would be interested in purchasing or leasing the Project from the Borrower for other purposes could be limited, and the ability of the Trustee to sell the Project to third parties would be adversely affected. Therefore, there is no assurance that the Trustee could realize sufficient proceeds from the foreclosure of the Mortgage and the sale of the Project thereunder to pay the Bonds in their entirety.

Rental Housing Requirements. The Project is subject to significant regulation which, among other things, affects the eligibility of tenants who may reside in the Project and the rents that may be charged to tenants. The Land Use Restriction Agreement further requires that so long as the Borrower is the owner of the Project, at least 40% of the units in the a Property will be occupied by residents with low income (60% of the median income for the Project’s location). See “INTRODUCTION” and “THE BORROWER AND THE PROJECT – Project Regulation” herein.

Pursuant to safe harbor rules relative to the tax-exempt status of the Sole Member, the Borrower must maintain a rental policy with respect to the portions of the project that are leased to low and very low income tenants that follows government imposed rental restrictions or a rental policy that otherwise provides that the housing is affordable to those tenants. However, these restrictions may limit the ability of the Borrower to increase the rentals charged to the tenants of the Project to the extent required to compensate for increasing expenses. See “THE BORROWER AND THE PROJECT – Project Regulation” and “– Prior Operating History” herein and “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Land Use Restriction Agreement” in Appendix B hereto. The foregoing rental housing requirements may adversely affect the occupancy and revenues of the Project and may limit the Borrower’s ability to refinance the Project.

Other Government Regulation. The Project is and will continue to be subject to rules and regulations promulgated by various agencies and bodies of federal, state and local governments which have jurisdiction over such matters as employment, environment, safety, traffic and health. The impact of such rules and regulations on the Project is unknown and cannot be predicted. Future orders, pursuant to existing or subsequently enacted rules or regulations, may require the expenditure by the Borrower of substantial sums to effect compliance therewith.

Environmental Risks. Based on the results of the Environmental Assessment, Gill Group did not identify any environmental concerns with the Project site.

The Borrower represents that it is not aware of any releases of pollutants or contaminants at the Project other than as disclosed in the Environmental Assessment that would give rise to enforcement actions under applicable state or federal environmental statutes. However, there could be other such releases not known to the Borrower as of the date of the issuance of the Bonds. The Borrower is not aware of any enforcement actions currently in process with respect to any releases of pollutants or contaminants at the real property relating to the Project.

The Project will be subject to risks arising out of environmental law considerations generally associated with ownership and/or leasing of real estate. Such risks include, in general, a decline in property values in the Project resulting from possible violations of applicable federal or state environmental laws and regulations, including, but not limited to, the Comprehensive Environmental Compensation and Liability Act of 1980 (CERCLA), the Resource Conservation and Recovery Act of 1976 (RCRA). These risks may be associated with contamination of the Project from hazardous substances located in, on, around or in the vicinity of the Project. Please refer to “THE BORROWER AND THE PROJECT – Environmental Assessment” herein.

Reliance on Property Manager

The Borrower has limited experience marketing, and managing facilities such as the Project, and as a consequence, the on-going management of the Project will be heavily dependent on the efforts of the Property Manager. The Property Manager will supervise the marketing, operation and management of the Project and the Borrower will rely on the experience and expertise of the Property Manager to supervise such operation and management.

If the Borrower were to terminate its relationship with the Property Manager it would need to hire and train a successor management/consulting company for the Project. No assurance can be given that the Property Manager can continue to successfully manage or operate the Project, that the Borrower will not terminate the relationship with the Property Manager or that another experienced successor management/consulting company to undertake the management or operation of the Project under the terms required by the Indenture. A failure to maintain the Property Manager as the management/consulting company for the Project or to hire, train and retain a successor management/consulting company may have an adverse effect on the ability of the Project to operate and could negatively impact occupancy levels and revenues of the Borrower. See “THE BORROWER AND THE PROJECT – The Property Manager” herein.

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Insurance Risks

The Loan Agreement requires the Borrower to carry certain insurance; however, there are certain types of losses (generally of a catastrophic nature) that are either uninsurable or not economically insurable. Such risks include, but may not be limited to, earthquakes, terrorism, war, hurricanes and floods. Moreover, such insurance coverage is subject to certain upper limits, which may not be sufficient to pay the costs of remedying every event of casualty that may occur. In addition, the Borrower could mistakenly allow the insurance on the Project to lapse. If an uninsured loss occurs, a default in payment of the Bonds could result.

In recent years, the number of general liability suits and the dollar amounts of damage recoveries have increased nationwide, resulting in substantial increases in general liability insurance premiums and, at times, difficulty obtaining such insurance. Litigation may also arise from the corporate and business activities of the Borrower and from the status of the Borrower as an employer; many of these risks are covered by insurance, but some are not.

The Borrower has arranged for insurance coverage which is customary for apartment projects of a similar nature. In the event of damage or condemnation, the Borrower relies on insurance proceeds and condemnation awards to pay all or part of the costs of restoring the Project. Failure of an insurer to pay a claim could result in a default on the Loan. There are certain types of losses which are not insured or insurable, such as “force majeure.” Should such a catastrophic casualty occur, the Borrower would suffer a loss for which insurance benefits would not be available. Further, there is no assurance that insurance proceeds where available will be sufficient to repay the Bonds.

While the Borrower is required by the Loan Agreement to have in effect at all times comprehensive general liability insurance providing insurance against liability for personal and bodily injury including death resulting therefrom, if a claim or judgment against the Borrower for an amount in excess of the limits of such insurance were to arise, it would likely have a material adverse effect on the financial results of the Project and the Borrower. In the event of damage or condemnation, the Borrower relies on insurance proceeds and condemnation awards to pay all or part of the costs of restoring the Project. Failure of an insurer to pay a claim could result in a default on the Loan. There are certain types of losses which are not insured or insurable, such as “force majeure.” Should such a catastrophic casualty occur, the Borrower would suffer a loss for which insurance benefits would not be available. Further, there is no assurance that insurance proceeds where available will be sufficient to repay the Bonds.

Appraisal

The Borrower secured an Appraisal for the Project in connection with the issuance of the Bonds. See “APPRAISAL” herein. The Appraisal was signed by an appraiser who holds the designation Certified General Appraiser from the State of Missouri. The Appraisal is based on certain assumptions significant to the operation of the Project as described therein, and sets forth information as of the date thereof. Some assumed events and circumstances inevitably will not materialize, and unanticipated events and circumstances may occur subsequent to the date of the Appraisal. Accordingly, the assumptions and other information in the Appraisal should be carefully evaluated by a prospective investor in the light of the circumstances then prevailing. Appraisals, by their nature, are based on the judgment of the appraiser, represent only estimates of value, and should not be relied upon as a measure of realizable value. There can be no assurance that information set forth therein continues to be accurate in all respects as of the date hereof. In any event, the accuracy of the Appraisal is dependent upon the occurrence of specified assumptions and other future events which cannot be assured, and therefore, the actual results achieved will vary from the forecasts, and the variation may be material. Neither the Authority, the Underwriter, the Trustee nor any counsel rendering approving or other opinions with respect to the transactions described herein have examined or verified the assumptions and conclusions contained in the Appraisal.

An appraisal typically contains the following elements: (i) certification of value; (ii) description of location of site; (iii) description of building; (iv) description of neighborhood; (v) description of zoning; (vi) local government assessment of value for ad valorem or real estate tax purposes; (vii) statement of highest and best use; (viii) determination of value by (a) income approach and (b) sales comparison approach; (ix) a market analysis comparing the Project with comparable projects (comparables include a discussion of facilities, configurations and amenities, as well as occupancy rates and rental concessions); (x) location map for the Project and for the

comparables; (xi) photographs of the Project and the comparables; and (xii) qualifications of the appraiser. An appraisal typically contains the following elements: (i) certification of value; (ii) description of location of site; (iii) description of building; (iv) description of neighborhood; (v) description of zoning; (vi) local government assessment of value for ad valorem or real estate tax purposes; (vii) statement of highest and best use; (viii) determination of value by (a) income approach and (b) sales comparison approach; (ix) a market analysis comparing the Project with comparable projects (comparables include a discussion of facilities, configurations and amenities, as well as occupancy rates and rental concessions); (x) location map for the Project and for the comparables; (xi) photographs of the Project and the comparables; and (xii) qualifications of the appraiser. The Appraiser determined the estate (i) “as-is” “market value” via the sales comparison approach is $17,400,000, (ii) “as-is” “market value” via the income approach is $17,225,000, and (iii) final “as-is” “market value” is $17,225,000.

There can be no assurance that another party would not have arrived at different, and perhaps significantly different, results, especially if such party elected to employ a different approach. If the Project were foreclosed and sold after an Event of Default, there can also be no assurance that the sale price would equal the appraised value. The Authority and the Underwriter make no representations as to the fair market value of the Project.

As described above, a summary of the Appraisal is set forth in this Official Statement. The summary does not purport to be complete or definitive and is qualified in its entirety by reference to the full Appraisal attached as Appendix G. See “APPRAISAL” herein.

Property Condition Assessment Report

The Borrower has obtained a property condition report with respect to the Project. Neither the Authority nor the Underwriter makes any representation as to the physical condition of the Project. There exists the possibility that the Project will require repairs and improvements that were not disclosed in the property condition report. Prospective purchasers of the Bonds may obtain a copy of the capital needs assessment upon request to the Underwriter during the initial offering period for the Bonds See the subheading “– Effect of Increases in Operating Expenses” above and “THE BORROWER AND THE PROJECT – Property Condition Assessment Report” herein.

Financial Projections

The financial projections included in Appendix D present the Borrower’s present estimate of future results of operations of the Project and are subject to certain assumptions used in preparing them as discussed therein. The Underwriter makes no representation or warranty as to the financial projections asserted therein. The passage of time and current economic conditions should be considered by investors when considering such projections. The financial projections included as Appendix D to this Official Statement were prepared by the Borrower and have not been audited or examined by an independent certified public accountant and are not intended to and do not meet the requirements of the American Institute of Certified Public Accountants for prospective financial forecasts or projects.

SOME ASSUMPTIONS MAY NOT MATERIALIZE AND UNANTICIPATED EVENTS AND CIRCUMSTANCES ARE LIKELY TO OCCUR. THEREFORE, THE ACTUAL RESULTS ATTAINED WILL IN ALL LIKELIHOOD VARY FROM THE PROJECTIONS CONTAINED IN THE PRO FORMA FINANCIAL PROJECTIONS. ACCORDINGLY, NO PERSON CAN MAKE REPRESENTATIONS OR WARRANTIES AS TO THE FUTURE RESULTS OF OPERATIONS OF THE PROJECT. IN ADDITION, THE PROFORMA FINANCIAL PROJECTIONS INCLUDED IN APPENDIX D HERETO HAVE NOT BEEN REVIEWED, COMPILED OR EXAMINED BY AN ACCOUNTANT.

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Acceleration of the Bonds; Limitation

The Indenture provides that following an Event of Default thereunder, the maturity of the Bonds may be accelerated by the Trustee, subject to cure provisions of the Indenture, and upon written request of the holders of a majority of the principal amount of the Bonds, shall be accelerated. However, the acceleration rights of holders of the Subordinate Bonds are limited during the period while any Senior Bonds remain Outstanding. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS - The Trust Indenture” in Appendix B hereto.

Risk of Early Redemption

There are a number of circumstances under which all or a portion of the Bonds may be redeemed prior to their stated maturity and redemption of the Subordinate Bonds is limited during the period while any Senior Bonds remain Outstanding. For a description of the circumstances in which Bonds may be redeemed and the terms of redemption, see “THE BONDS” herein.

Risk of Loss Upon Redemption

The rights of Bondholders to receive interest will terminate on the date, if any, on which such Bonds are to be redeemed pursuant to a call for redemption, notice of which has been given under the terms of the Indenture and interest on such Bonds will no longer accrue on and after such date of redemption. There can be no assurance that the Borrower will be able or will be obligated to pay for any amounts not available under the Indenture. In addition, there can be no guarantee that present provisions of the Code or the rules and regulations thereunder will not be adversely amended or modified, thereby rendering the interest earned on the Bonds taxable for federal income tax purposes.

Incurrence of Additional Indebtedness

The Loan Agreement and the Indenture permit the Borrower to incur additional indebtedness, upon compliance with the provisions thereof. Such additional indebtedness, under certain circumstances, may be equally and ratably secured with the Bonds on a senior basis with respect to the Senior Bonds and on a subordinate basis with respect to the Subordinate Bonds, as applicable. See “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Loan Agreement, – The Indenture” in Appendix B hereto.

Debt Service Reserve Fund

The Indenture creates a Debt Service Reserve Fund. In the event that the Borrower does not make timely payment under the Note, funds in the Debt Service Reserve Fund will be used to make payments of principal of and interest on the Bonds as they become due. Although the Borrower believes such reserve to be reasonable, and anticipates that Project Revenues will be sufficient to cover the debt service on the Bonds, there is no assurance that funds reserved and future Project Revenues will be sufficient to cover debt service on the Bonds. In addition, the Debt Service Reserve Fund is only funded at one-half of Maximum Annual Debt Service of the Bonds. Although the Loan Agreement requires the Borrower to do so, there can be no assurance that the Borrower will repay into the Debt Service Reserve Fund money so advanced. Investments in the Debt Service Reserve Fund must be in Investment Securities (as described in the Indenture), but are subject to investment risks. There can be no assurance that if the Debt Service Reserve Fund has to be liquidated that sale of investments therein will not result in a loss.

Effect of Bankruptcy

Although the security given for the benefit of Owners of the Bonds is superior to the claims of others, bankruptcy and similar proceedings against the Borrower and usual equity principles may affect the enforcement of rights to such security. A court may invoke other equity principles to refuse to enforce specific rights to such security. If such security is inadequate for payment in full of the Bonds, bankruptcy proceedings and usual equity principles may also limit any attempt by the Trustee to seek payment from other property, if any, of the Borrower.

If the Borrower were to file a voluntary petition for bankruptcy under the United States Bankruptcy Code or have an involuntary petition in bankruptcy filed against it, the filing of such a petition, in either case, would operate as an automatic stay of the commencement or continuation of any judicial or other proceeding against the Borrower, and any interest it has in property. If the bankruptcy court so orders, after notice and opportunity for hearing, the Borrower’s property, including its accounts receivable and proceeds thereof, could be used, at least temporarily, for the benefit of the bankruptcy estate despite the claims of its creditors.

In a case under the current United States Bankruptcy Code, the debtor could file a plan of reorganization. The plan is the vehicle for satisfying, and provides for the comprehensive treatment of, all claims against such the debtor and could result in the modification of rights of any class of creditors, secured or unsecured. To confirm a plan of reorganization, with one exception discussed below, it must be approved by the vote of each class of impaired creditors. A class approves a plan if, of those who vote, those holding more than one-half in number and at least two-thirds in amount vote in favor of a plan. Approval by classes of interests requires a vote in favor of the plan by at least two-thirds in amount of the allowed interests that have voted. If these levels of votes are attained, those voting against the plan or not voting at all are nonetheless bound by the terms thereof if the plan is confirmed. Other than as provided in the confirmed plan, all claims and interests are discharged and extinguished. If fewer than all of the impaired classes accept the plan, the plan may nevertheless be confirmed by the bankruptcy court, and the dissenting claims and interests would be bound thereby. For this to occur, at least one of the impaired classes must vote to accept the plan and the bankruptcy court must determine that the plan does not “discriminate unfairly” and is “fair and equitable” with respect to the non-consenting class. A plan is fair and equitable if each class is treated in accordance with its credit priority and no class receives a distribution until senior classes are paid in full. The United States Bankruptcy Code establishes different fair and equitable tests for secured claims, unsecured claims and interest holders. To be confirmed, the bankruptcy court must also determine that a plan, among other requirements, provides creditors with at least what they would receive in the event of liquidation, is proposed in good faith, and that the debtor’s performance under the plan is feasible.

Bankruptcy proceedings by or against the Borrower could adversely affect Beneficial Owners of the Bonds by reducing or delaying payments on the Bonds and may impede enforcement by the Trustee and such Owners of their claims to the collateral assigned and pledged to secure the Bonds. Federal bankruptcy law also permits adoption of a reorganization plan without the approval of such Owners if they are provided with the benefit of their original security or the “indubitable equivalent.” In addition, if a bankruptcy court concludes that such registered Owners have “adequate protection,” the court may (1) substitute other security for the security of the registered Owners and (2) subordinate the security of the registered Owners to (a) claims by persons supplying goods, services or credit to the Borrower after bankruptcy and (b) the administrative expenses of the bankruptcy proceeding. In the event of such bankruptcy, the amount realized by the registered Owners of the Bonds may depend on the court’s interpretation of “indubitable equivalent” and “adequate protection” under then existing circumstances. The effect of these and other provisions of federal bankruptcy law cannot be predicted and may be significantly affected by judicial interpretation.

Furthermore, recent judicial decisions concerning the status of debt service reserve funds held by an indenture trustee have concluded that such reserves are “cash collateral” of a debtor in bankruptcy and have cast doubt on the ability of the Trustee to use moneys in the Debt Service Reserve Fund to make payments on the Bonds in the event of a bankruptcy by or against the Borrower absent the granting of relief from the automatic stay which may or may not be granted given the particular facts and circumstances of the case.

Enforceability of Remedies; Prior Claims

The Bonds are payable from the payments to be made under the Loan Agreement. Pursuant to the Indenture, the Bonds are secured by an assignment by the Authority to the Trustee of certain of its rights under the Loan Agreement (except as provided therein) and by the Mortgage on the Project and the security interest in the personal property and Project Revenues. The practical realization of the value from this property upon any default will depend upon the exercise of various remedies specified by the Loan Agreement, the Note, the Mortgage and the Indenture. These and other remedies may require judicial actions, which are often subject to discretion and delay. Under existing law (including, without limitation, the Federal Bankruptcy Code), the remedies specified by the Loan Agreement, the Mortgage or the Indenture may not be readily available or may be limited. A court may decide not to order the specific performance of the covenants contained in the Loan Agreement, the Mortgage or the Indenture.

The various opinions to be delivered concurrently with the delivery of the Bonds will be qualified as to the enforceability of the various legal instruments by limitations imposed by state and federal laws, rulings and decisions affecting remedies, and by bankruptcy, reorganization or other laws affecting the enforcement of creditors’ rights generally.

In addition, the various security interests established under the Indenture and the Mortgage will be subject to Permitted Encumbrances, and may be limited by or subject to other claims and interests. Examples of such claims and interests are (i) statutory liens and assessments for improvements; (ii) rights arising in favor of the United States of America or any agency thereof; (iii) constructive trusts, equitable liens or other rights impressed or conferred by any state or federal court in the exercise of its equitable jurisdiction; (iv) federal bankruptcy laws affecting amounts earned by the Borrower after institution of bankruptcy proceedings by or against the Borrower; and (v) the requirement that appropriate continuation statements be filed in accordance with the Uniform Commercial Code as from time to time in effect.

Secondary Market and Prices

The Underwriter will not be obligated to repurchase any of the Bonds and no representation is made concerning the existence of any secondary market therefor, nor can any assurance be given that any secondary market will develop following the completion of the offering of the Bonds, and no assurance can be given that initial offering prices for the Bonds will continue for any period of time. Any prospective purchaser of the Bonds, therefore, should undertake an independent investigation through its own advisors regarding the desirability and practicality of the investment in the Bonds. Any prospective purchaser should be fully aware of the long-term nature of an investment in the Bonds and should assume that it will have to bear the economic risk of its investment indefinitely. Any prospective purchaser of the Bonds that does not intend or that is not able to hold the Bonds for a substantial period of time is advised against investing in the Bonds.

Credit Ratings

There is no assurance that the credit ratings assigned to the Bonds at the time of issuance or at a subsequent time will not be lowered or withdrawn, the effect of which could adversely affect the market price and the market for such Bonds. The Rating Agency may revise the criteria under which it rates the Bonds at any time, which revisions could result in significant changes to or withdrawal of the credit ratings assigned to the Bonds. In addition, in determining the initial credit ratings for the Bonds, and in conducting its annual rating surveillance, the Rating Agency may use assumptions regarding occupancy, revenues, expenses and values related to the Project that differ materially from those used by the Borrower. Such differences could result in a lowering or withdrawal of the ratings on the Bonds, if, for example, the Rating Agency’s calculations resulted in a failure of the Project to meet the required Coverage Test for the Bonds. There is no covenant requiring the Borrower to maintain the credit rating assigned to the Bonds or to maintain any credit rating in the future.

Specific Tax Covenants of Borrower and Rental Restrictions

As referenced in the Sections of this Official Statement captioned “INTRODUCTION,” “THE BORROWER AND THE PROJECT – Project Regulation” and “—Prior Operating History,” the Borrower has covenanted to comply with certain income limits and certain rent restrictions with respect to the Project. These restrictions, by their very nature, limit the revenues which the Project can generate in order to repay the Bonds. See “Risk Factors and Investment Considerations – Project Risks - Rental Housing Requirements” herein and “SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS – The Land Use Restriction Agreement” in Appendix B hereto.

State and Local Taxation

Interest earned on the principal amount of the Bonds may or may not be subject to state or local income taxes under applicable state or local tax laws. Each purchaser of the Bonds should consult his or her own tax advisor regarding the taxable status of the Bonds in a particular state or local jurisdiction.

Taxation of the Bonds

The interest on the Tax-Exempt Bonds may be includable in gross income for purposes of federal income taxation retroactive to the date of issuance of the Tax-Exempt Bonds for a variety of reasons. The exclusion from gross income is dependent upon, among other things, compliance with certain restrictions regarding investment of Tax-Exempt Bond proceeds and continuing compliance by the Borrower with the Land Use Restriction Agreement under which enforcement remedies available to the Authority and the Trustee are severely limited. In addition, the Borrower must be and remain, an organization treated as part of the Sole Member and the Sole Member must remain a 501(c)(3) organization at all times while any Tax-Exempt Bonds remain Outstanding in order for the Tax-Exempt Bonds to retain their tax-exempt status. Failure of the Borrower to comply with the terms and conditions of the documents relating to the Tax-Exempt Bonds or the Loan Agreement, the Land Use Restriction Agreement and other documents as described herein may result in the loss of the tax-exempt status of the interest on the Tax- Exempt Bonds retroactive to the date of issuance of the Tax-Exempt Bonds. See “Project Risks; Rental Housing Requirements” under this heading and “TAX MATTERS” herein. Although a determination of taxability is not an express Event of Default, the Borrower has covenanted to take all action necessary to cause interest on the Tax- Exempt Bonds to remain tax-exempt; therefore, if interest on the Tax-Exempt Bonds become taxable, this could be an Event of Default. No assurance can be given that sufficient funds will be available in such a case to enable the Tax-Exempt Bonds to be redeemed at the applicable redemption price.

If interest on the Tax-Exempt Bonds should become included in gross income for federal income tax purposes, the market for and value of the Tax-Exempt Bonds could be adversely affected.

Moreover, there can be no assurance that the present advantageous provisions of the Code, or the rules and regulations thereunder, will not be retroactively adversely amended or modified, thereby resulting in the inclusion in gross income of the interest on the Tax-Exempt Bonds for Federal income tax purposes or otherwise eliminating or reducing the benefits of the present advantageous tax treatment of the Tax-Exempt Bonds. There can be no assurance that Congress will not adopt legislation applicable to the Tax-Exempt Bonds, the Borrower or the Project or that the Borrower would be able to comply with any such future legislation in a manner necessary to maintain the tax-exempt status of the Tax-Exempt Bonds. The Borrower is required under the Loan Agreement to use its best efforts to comply with any other future Federal income tax law requirements in order to maintain the tax-exempt status of the Tax-Exempt Bonds to the extent that any such other requirements are made applicable to the Borrower or the Project. There is no assurance, however, that the Borrower would be able to comply with any such other requirements.

Federal Income Tax Matters; 501(c)(3) Status of Borrower

Loss by the Borrower of the benefits of certain provisions of the federal income tax law could affect adversely its financial position as well as jeopardize the tax-exempt status of the Bonds. The IRS has determined in a determination that the Sole Member is an organization described in Section 501(c)(3) of the Code, and therefore is exempt from federal income taxation under Section 501(a) of the Code. Changes in the Code or Treasury Regulations or the judicial or administrative interpretation thereof or certain actions of the Sole Member or the Borrower could result in the revocation by the IRS of such determination and loss of the tax-exempt status of the Sole Member or the Borrower.

Any failure by the Sole Member or the Borrower to remain qualified as tax-exempt under Section 501(c)(3) of the Code could affect the amount of funds of the Borrower which would be available to pay debt service on the Bonds or could lead to a determination that the interest on the Bonds is taxable. The Borrower’s or the Authority’s failure to continuously comply with certain covenants contained in the Indenture, the Loan Agreement and the Land Use Restriction Agreement after delivery of the Bonds could result in the loss of the exclusion from gross income of interest on the Bonds by the owners thereof for federal income tax purposes.

Possible Consequence of Tax Compliance Audit

The IRS has established a general audit program to determine whether issuers of tax-exempt obligations, such as the Bonds, are in compliance with requirements of the Code that must be satisfied in order for the interest of those obligations to be, and continue to be, excluded from gross income for federal income tax purposes. It cannot

be predicted whether the IRS will commence an audit of the Bonds. Depending on all the facts and circumstances and the type of audit involved, it is possible that commencement of an audit of the Bonds could adversely affect the market value and liquidity of the Bonds until the audit is concluded, regardless of its ultimate outcome.

Forward-Looking Statements

Certain statements in this Official Statement that relate to the Project and the Borrower including, but not limited to, statements under the captions “THE BORROWER AND THE PROJECT” and “ESTIMATED SOURCES AND USES OF FUNDS” herein and “PRO FORMA FINANCIAL PROJECTIONS” attached as Appendix D hereto, are forward-looking statements that are based on the beliefs of, and assumptions made by, the management of the Borrower. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance of the Project and the Borrower to be materially different from any expected future results or performance. Such factors include, but are not limited to, items described in “RISK FACTORS AND INVESTMENT CONSIDERATIONS.”

Other Possible Risk Factors

The occurrence of any of the following events, or other unanticipated events, could adversely affect the operations of the Borrower and the Project:

1. Reinstatement of or establishment of mandatory governmental wage, rent or price controls.

2. Inability to control increases in operating costs, including salaries, wages and fringe benefits, supplies and other expenses, without being able to obtain corresponding increases in Project Revenues from residents of the Project.

3. Unionization, employee strikes and other adverse labor actions which could result in a substantial increase in expenditures without a corresponding increase in Project Revenues.

4. Adoption of other federal, state or local legislation or regulations having an adverse effect on the future operating or financial performance of the Borrower and the Project.

5. The occurrence of any natural disasters, including hurricanes or other disruptions that impact the operations of the Project.

Summary

The foregoing is intended only as a summary of certain risk factors attendant to an investment in the Bonds. In order for potential investors to identify risk factors and make an informed investment decision, potential investors should be thoroughly familiar with this entire Official Statement and the appendices hereto so as to make a judgment as to whether the Bonds are an appropriate investment, and obtain such additional information as they deem advisable in connection with their evaluation of the suitability of the Bonds for investments.

LITIGATION

The Authority

At the time of the issuance and delivery of the Bonds, the Authority will deliver a certificate to the effect that there is not pending or, to the knowledge of the Authority, threatened any litigation restraining or enjoining the issuance or delivery of the Bonds or questioning or affecting the validity of the Bonds or the proceedings or authority under which they are to be issued, and that there is no litigation pending or, to the Authority’s knowledge, threatened that in any manner questions the right of the Authority to enter into the Loan Agreement or the Indenture or to secure the Bonds in the manner provided in the Indenture and the Act.

The Borrower

At the time of the issuance and delivery of the Bonds, the Borrower will deliver a certificate to the effect that no litigation and no proceedings are pending or, to its knowledge, threatened against the Borrower, the Sole Member or otherwise with respect to the Project, or the acquisition and rehabilitation thereof, or the issuance of the Bonds or which would materially adversely affect the transactions contemplated by this Official Statement.

APPROVAL OF LEGAL MATTERS

Legal matters incident to the authorization, issuance, sale and delivery of the Bonds by the Authority are subject to the approving opinion of Butler Snow LLP, Baton Rouge, Louisiana, Bond Counsel. Copies of the approving opinion of Bond Counsel will be available at the time of delivery of the Bonds in substantially the form set forth in Appendix C.

Certain legal matters will be passed upon for the Issuer by its counsel, Joseph Delafield, Lake Charles, Louisiana; for the Borrower and the Sole Member by their counsel, Brennan, Manna & Diamond, LLC, Jacksonville, Florida and their local counsel, Sher Garner Cahill Richter Klein & Hilbert L.L.C., New Orleans, Louisiana; and for the Underwriter by its counsel, Foley & Judell, L.L.P, New Orleans, Louisiana.

The various legal opinions to be delivered concurrently with the delivery of the Bonds express the professional judgment of the attorneys rendering those opinions on the legal issues explicitly addressed therein. By rendering the legal opinion, the opinion giver does not become an insurer or guarantor of an expression of professional judgment of the transaction opined upon or of the future performance of parties to such transaction, nor does the rendering of an opinion guarantee the outcome of any legal dispute that may arise out of the transaction.

TAX MATTERS

General Matters

In the opinion of Bond Counsel, based upon an analysis of existing laws, regulations, rulings and judicial decisions, interest on the Tax-exempt Bonds will be excludible from gross income for federal income tax purposes. Bond Counsel is also of the opinion that interest on the Tax-exempt Bonds will not be a specific item of tax preference under Section 57 of the Internal Revenue Code of 1986, as amended (the “Code”) for purposes of the federal individual and corporate alternative minimum taxes. In the opinion of Bond Counsel, based upon an analysis of existing laws, regulations, rulings and judicial decisions, interest on the Series 2017 Bonds is exempt from all present taxes imposed by the State and any parish, municipality or other political subdivision of the State of Louisiana

A copy of the opinion of Bond Counsel is set forth in Appendix C attached hereto.

Notwithstanding Bond Counsel’s opinion that interest on the Tax-exempt Bonds is not a specific preference item for purposes of the federal alternative minimum tax, such interest will be included in adjusted current earnings of certain corporations, and such corporations are required to include in the calculation of alternative minimum taxable income 75% of the excess of such corporation’s adjusted current earnings over its alternative minimum taxable income (determined without regard to such adjustment and prior to deduction for certain net operating losses). The Code imposes various restrictions, conditions, and requirements relating to the qualification of Tax- exempt Bonds as so-called “tax-exempt” bonds. The Issuer, the Borrower and the Sole Member have covenanted to comply with certain restrictions designed to ensure that interest on the Tax-exempt Bonds will not be includable in gross income for federal income tax purposes. Failure to comply with these covenants could result in the Tax- exempt Bonds not qualifying as “tax-exempt bonds,” and thus interest on the Tax-exempt Bonds being includable in the gross income of the holders thereof for federal income tax purposes. Such failure to qualify and the resulting inclusion of interest could be required retroactively to the date of issuance of the Tax-exempt Bonds. The opinion of Bond Counsel assumes compliance with these covenants. However, Bond Counsel has not undertaken to determine (or to inform any person) whether any actions taken (or not taken) or events occurring (or not occurring) after the

date of issuance of the Tax-exempt Bonds may adversely affect the federal tax status of the Tax-exempt Bonds. The opinion of Bond Counsel also relies on the opinion of Brennan, Manna & Diamond, LLC, LLC, Jacksonville, Florida that the Sole Member is an organization described in Section 501(c)(3) of the Code and that the Project will not be used in an unrelated trade or business within the meaning of Section 513 of the Code. Bond Counsel has not undertaken to confirm the validity of such opinion.

Certain requirements and procedures contained, or referred to, in the Indenture, the Tax Agreement, the Land Use Restriction Agreement and other relevant documents may be changed and certain actions (including, without limitation, defeasance of the Tax-exempt Bonds) may be taken or omitted under the circumstances and subject to the terms and conditions set forth in such documents. Bond Counsel expresses no opinion as to the Tax- exempt Bonds or the interest thereon if any such change occurs or action is taken or omitted upon the advice or approval of bond counsel other than Butler Snow LLP.

Although Bond Counsel is of the opinion that interest on the Tax-exempt Bonds will be excludible from gross income for federal income tax purposes, as described above, the ownership or disposition of, or the accrual or receipt of interest on, the Tax-exempt Bonds may otherwise affect a holder’s federal, state or local tax liabilities. The nature and extent of these other tax consequences may depend upon the particular tax status of the holder or the holder’s other items of income or deduction. Bond Counsel expresses no opinions regarding any tax consequences other than what is set forth in its opinion and each holder of the Series 2017 Bonds or potential holder is urged to consult with its tax counsel or advisor with respect to the effects of purchasing, holding or disposing the Series 2017 Bonds on the tax liabilities of the individual or entity.

Receipt of tax-exempt interest, ownership or disposition of the Tax-exempt Bonds may result in other collateral federal, state or local tax consequence for certain taxpayers. Such effects may include, without limitation, increasing the federal tax liability of certain foreign corporations subject to the branch profits tax imposed by Section 884 of the Code, increasing the federal tax liability of certain insurance companies under Section 832 of the Code, increasing the federal tax liability and affecting the status of certain S Corporations subject to Sections 1362 and 1375 of the Code, increasing the federal tax liability of certain individual recipients of Social Security or the Railroad Retirement benefits under Section 86 of the Code and limiting the amount of the Earned Income Credit under Section 32 of the Code that might otherwise be available. Ownership of any of the Series 2017 Bonds may also result in the limitation of interest and certain other deductions for financial institutions and certain other taxpayers pursuant to Section 265 of the Code.

Backup Withholding

As a result of the enactment of the Tax Increase Prevention and Reconciliation Act of 2005, interest on tax- exempt obligations such as the Tax-exempt Bonds is subject to information reporting in a manner similar to interest paid on taxable obligations. Backup withholding may be imposed on payments made after March 31, 2007 to any bondholder who fails to provide certain required information including an accurate taxpayer identification number to any person required to collect such information pursuant to Section 6049 of the Code. This reporting requirement does not in and of itself affect or alter the excludability of interest on the Tax-exempt Bonds from gross income for federal income tax purposes or any other federal tax consequence of purchasing, holding or selling tax-exempt obligations. Original Issue Premium

“Acquisition Premium” is the excess of the cost of an obligation over the stated redemption price of such obligation at maturity or, for obligations that have one or more earlier call dates, the amount payable at the next earliest call date. The Tax-exempt Bonds that bear an interest rate that is higher than the yield (as shown on the maturity schedule on the inside cover page hereof), are being initially offered and sold to the public at an Acquisition Premium (the “Premium Bonds”). For federal income tax purposes, the amount of Acquisition Premium on each obligation the interest on which is excludable from gross income for federal income tax purposes (“tax-exempt obligations”) must be amortized and will reduce the holder’s adjusted basis in that obligation. However, no amount of amortized Acquisition Premium on tax-exempt obligations may be deducted in determining a holder’s taxable income for federal income tax purposes. The amount of any Acquisition Premium paid on the Premium Bonds, or on any of the Tax-exempt Bonds, that must be amortized during any period will be based on the

“constant yield” method, using the original holder’s basis in such obligations and compounding semiannually. This amount is amortized ratably over that semiannual period on a daily basis.

Holders of any Tax-exempt Bonds, including any Premium Bonds, purchased at an Acquisition Premium should consult their own tax advisors as to the actual effect of such Acquisition Premium with respect to their own tax situation and as to the treatment of Acquisition Premium for state tax purposes.

Original Issue Discount

The Tax-exempt Bonds having a yield that is higher than the interest rate (as shown as shown on the maturity schedule on the inside cover page hereof) are being offered and sold to the public at an original issue discount (“OID”) from the amounts payable at maturity thereon (the “Discount Bonds”). OID is the excess of the stated redemption price of an obligation at maturity (the face amount) over the “issue price” of such bond. The issue price is the initial offering price to the public (other than to bond houses, brokers or similar persons acting in the capacity of underwriters or wholesalers) at which a substantial amount of obligations of the same maturity are sold pursuant to that initial offering. For federal income tax purposes, OID on each obligation will accrue over the term of the obligation, and for the Discount Bonds, the amount of accretion will be based on a single rate of interest, compounded semiannually (the “yield to maturity”). The amount of OID that accrues during each semi-annual period will do so ratably over that period on a daily basis. With respect to an initial purchaser of a Discount Bond at its issue price, the portion of OID that accrues during the period that such purchaser owns the Discount Bond is added to such purchaser’s tax basis for purposes of determining gain or loss at the maturity, redemption, sale or other disposition of that Discount Bond and thus, in practical effect, is treated as stated interest, which is excludable from gross income for federal income tax purposes.

Holders of any Series 2017 Bonds, including any Discount Bonds should consult their own tax advisors as to the treatment of OID and the tax consequences of the purchase of such Discount Bonds other than at the issue price during the initial public offering and as to the treatment of OID for state tax purposes.

Changes in Federal and State Tax Law

From time to time, there are legislative proposals in the Congress and in the states that, if enacted, could alter or amend the federal and state tax matters referred to above or adversely affect the market value of the Series 2017 Bonds. It cannot be predicted whether or in what form any such proposal might be enacted or whether if enacted it would apply to bonds issued prior to enactment. In addition, regulatory actions are from time to time announced or proposed and litigation is threatened or commenced which, if implemented or concluded in a particular manner, could adversely affect the market value of the Series 2017 Bonds. It cannot be predicted whether any such regulatory action will be implemented, how any particular litigation or judicial action will be resolved, or whether the Series 2017 Bonds or the market value thereof would be impacted thereby. Purchasers of the Series 2017 Bonds should consult their tax advisors regarding any pending or proposed legislation, regulatory initiatives or litigation. The opinions expressed by Bond Counsel are based upon existing legislation and regulations as interpreted by relevant judicial and regulatory authorities as of the date of issuance and delivery of the Series 2017 Bonds and Bond Counsel has expressed no opinion as of any date subsequent thereto or with respect to any pending legislation, regulatory initiatives or litigation.

RATINGS

Standard & Poor’s Rating Services, a Standard & Poor’s Financial Services, LLC business (the “Rating Agency”) has assigned a rating of “A” to the Senior Bonds and “BBB” to the Subordinate Bonds. An explanation of the significance of such ratings may be obtained from the Rating Agency. The ratings of the Bonds reflect only the views of the Rating Agency at the time such ratings were given, and neither the Authority, the Borrower nor the Underwriter makes any representation as to the appropriateness of the ratings. There is no assurance that such ratings will continue for any given period of time or that it will not be revised downward or withdrawn entirely by the Rating Agency, if in its judgment, circumstances (including the financial status of any investment agreement provider) so warrant. Any such downward revision or withdrawal of the ratings (or either of them) may have an adverse effect on the market price of the Bonds.

UNDERWRITING

Pursuant to a Bond Purchase Agreement among the Authority, the Borrower, and Stifel, Nicolaus & Company, Incorporated (the “Underwriter”), the Underwriter has agreed to purchase the Bonds at the purchase prices set forth on the inside front cover hereof plus accrued interest to the date of purchase. For its services, the Underwriter shall be paid by the Borrower an Underwriter fee equal to $______plus expenses. The Bond Purchase Agreement provides that the Underwriter shall purchase all of the Bonds if any are purchased, and that such obligation to purchase the Bonds is subject to certain terms and conditions set forth in such Bond Purchase Agreement, the approval of certain legal matters by counsel and certain other conditions. The initial offering price set forth on the inside cover page hereof may be changed from time to time by the Underwriter, the Underwriter may join with dealers and other Underwriter in offering the Bonds, and the Underwriter may offer and sell Bonds to certain dealers (including dealer banks and dealers depositing Bonds in investment trusts) and others at prices lower than the public offering prices stated on the inside cover of this Official Statement. Such initial public offering prices may be changed from time to time by the Underwriter.

The Borrower has agreed, pursuant to the Bond Purchase Agreement, to indemnify the Underwriter and the Authority against certain liabilities relating to this Official Statement.

The Underwriter does not guarantee a secondary market for the Bonds and is not obligated to make any such market for the Bonds. No assurance can be made that such a market will develop or continue. Consequently, investors may not be able to resell Bonds should they need or wish to do so for emergency or other purposes.

CONTINUING DISCLOSURE

In accordance with the Securities and Exchange Commission Rule 15c2-12 (the “Rule”) the Borrower has agreed pursuant to a Continuing Disclosure Agreement dated as of April 1, 2017 with Disclosure Advisors LLC, as dissemination agent (the “Dissemination Agent”), to be delivered on the date of delivery of the Bonds, to cause certain financial and operating information to be provided through the Dissemination Agent to the Municipal Securities Rulemaking Board (the “MSRB”) via the Electronic Municipal Marketing Access (“EMMA”) System.

The Authority has determined that no financial or operating data concerning the Authority is material to an evaluation of the offering of the Bonds or to any decision to purchase, hold or sell the Bonds and the Authority will not provide any such information. The Borrower has undertaken all responsibilities for any continuing disclosure to holders of the Bonds as described in the Continuing Disclosure Agreement, and the Authority shall have no liability to the holders of the Bonds or any other person with respect to S.E.C. Rule 15c2-12. The Borrower has not previously been subject to the Rule.

See “FORM OF CONTINUING DISCLOSURE AGREEMENT” in Appendix F hereto.

RELATIONSHIPS AMONG PARTIES

Bond Counsel has previously represented, and is currently representing, the Underwriter with respect to other financings and has acted or is acting as bond counsel with respect to other bonds underwritten by the Underwriter and may do so in the future. Counsel to the Underwriter has previously acted as bond counsel with respect to other bonds underwritten by the Underwriter and other bonds issued by the Issuer.

MISCELLANEOUS

Any statements made in this Official Statement involving matters of opinion or estimates, whether or not so expressly stated, are set forth as such and not as representations of fact, and no representation is made that any of the estimates will be realized.

The references herein to the Act, the Indenture, the Loan Agreement, the Note, the Mortgage, the Land Use Restriction Agreement, the Tax Credit Agreement and other documents are brief outlines of certain provisions thereof. Such outlines do not purport to be complete or comprehensive and for a full and complete statement of the

provisions thereof, reference is made to the Act, and such documents, copies of which documents will be on file at the office of the Trustee following delivery of the Bonds.

The agreement of the Authority with the Holders of the Bonds is fully set forth in the Indenture, and this Official Statement is not to be construed as constituting any agreement with the purchasers of the Bonds. Insofar as any statements are made in this Official Statement involving matters of opinion, whether or not expressly so stated, they are intended merely as such, and not as representations of fact.

The attached Appendices are integral parts of this Official Statement and must be read together with all of the foregoing statements.

The Borrower has reviewed the information contained herein which relates to it and the Project and has approved all such information for use within this Official Statement.

The Authority has not participated in the preparation of this Official Statement and has not verified the accuracy of the information contained herein, other than the information respecting the Authority contained under “INTRODUCTION – The Authority,” “THE AUTHORITY” and “LITIGATION – The Authority.” The Authority’s approval of this Official Statement does not constitute approval of the information contained herein, other than that information relating to the Authority, or a representation of the Authority as to the completeness or accuracy of the information contained herein.

[Remainder of Page Intentionally Left Blank]

The execution, delivery and distribution of this Official Statement have been duly authorized by the Borrower.

2016 AVHG COVE, LLC, a Louisiana limited liability company

By: Invest in America’s Veterans Foundation, Inc., a Florida not-for-profit corporation Its: Sole Member

By: Name: Ralph A. Santillo Title: President

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APPENDIX A

DEFINITIONS OF CERTAIN TERMS

Capitalized items used in this Official Statement, and not otherwise defined, are used with the meanings assigned to such terms in the Indenture. The following definitions of such capitalized terms are summaries of the definitions applicable in the Indenture with such modifications as may be appropriate for use in this Official Statement.

The following are definitions set forth in the Indenture and used in this Official Statement:

“Account” or “Accounts” means any one or more, as the case may be, of the named and unnamed accounts established within any Fund.

“Act” means the LCDA Act and the Revenue Bond Act.

“Additional Bonds” means the additional parity Bonds authorized to be issued by the Authority pursuant to the terms and conditions of Section 2.13 of the Indenture.

“Additional Loan Payments” means that portion of the Loan Payments described in subsection (b)(ii) of Section 3.2 of the Loan Agreement.

“Administration Expenses” means (a) the Ordinary Trustee’s Fees and Expenses and the Additional Loan Payments described in Section 3.2(b)(ii)(1) of the Loan Agreement, (b) the Dissemination Agent Fee, (c) the Rebate Analyst Fee, and (d) the Rating Agency Fee.

“Administration Fund” means the trust fund by that name established pursuant to Section 5.01 of the Indenture.

“Advanced Funds” has the meaning provided in Section 8.04 of the Indenture.

“Affiliate” means any Person (a) directly or indirectly controlling, controlled by, or under common control with the Borrower; or (b) a majority of the members of the Governing Body of which are members of the Governing Body of the Borrower. For purposes of this definition, control means with respect to: (i) a corporation having stock, the ownership, directly or indirectly, of more than fifty percent (50%) of the securities (as defined in Section 2(1) of the Securities Act of 1933, as amended) of any class or classes, the holders of which are ordinarily, in the absence of contingencies, entitled to elect a majority of the directors of such corporation; (ii) a not for profit corporation not having stock, having the power to elect or appoint, directly or indirectly, a majority of the members of the Governing Body of such corporation; or (iii) any other entity, the power to direct the management of such entity through the ownership of at least a majority of its voting securities or the right to designate or elect at least a majority of the members of its Governing Body, by contract or otherwise. For the purposes of this definition, “Governing Body” means with respect to: (A) a corporation having stock, such corporation’s board of directors and owners, directly or indirectly, of more than fifty percent (50%) of the securities (as defined in Section 2(1) of the Securities Act of 1933, as amended) of any class or classes, the holders of which are ordinarily, in the absence of contingencies, entitled to elect a majority of the directors of such corporation (both of which groups will be considered a Governing Body); (B) a not for profit corporation not having stock, such corporation’s members if the members have complete discretion to elect the corporation’s directors, or the corporation’s directors if the corporation’s members do not have such discretion; or (C) any other entity, its governing body or board. For the purposes of this definition, all references to directors and members will be deemed to include all entities performing the function of directors or members however denominated.

“Amend” or “Amendment,” as used in Article XI of the Indenture, refer to any amendment, modification, alteration or supplement to any Bond Document, or any waiver of any provision thereof.

A-1

“Annual Debt Service” means, for any period of a calendar year, the amount of the scheduled principal and interest payment required with respect to all Outstanding Bonds, or all Outstanding Bonds of one or more Series, or Parity Indebtedness, as applicable, for such period.

“Annual Evaluation Date” means each December 31, beginning December 31, 2017.

“Audited Financial Statements” means the financial statements prepared for each Fiscal Year for the Project prepared in accordance with generally accepted accounting principles and examined by a Certified Public Accountant.

“Architect” means any architect, engineer or firm of architects or engineers which is Independent and which is appointed by the Borrower for the purpose of passing on questions relating to the design and construction of any particular facility, has all licenses and certifications necessary for the performance of such services, and has a favorable reputation for skill and experience in performing similar services in respect of a facility of a comparable size and nature of the Project.

“Asset Manager” means Strategic Realty Capital, LLC, a Delaware limited liability company, and any subsequent asset manager under any Asset Management Agreement which subsequent asset manager satisfies the requirements of Section 4.7 of the Loan Agreement.

“Asset Management Agreement” means the Asset Management Agreement, dated as of April 1, 2017, between the American Veteran Housing Group (as agent for the Borrower) and the Asset Manager, or any substitute agreement, in each case as it may be amended and supplemented from time to time.

“Authority” means the Louisiana Local Government Environmental Facilities and Community Development Authority, its successors and assigns.

“Authority Representative” means any person designated by resolution of the Authority (whether such resolution is adopted in connection with the issuance of the Bonds or otherwise) as an “Authorized Officer” empowered to, among other things, execute and deliver on behalf of the Authority the Indenture, the other Bond Documents and the Bonds.

“Authorized Denominations” means $5,000 principal amount and any integral multiple in excess thereof.

“Basic Loan Payments” means that portion of the Loan Payments described in Subsection 3.2(b)(i) of the Loan Agreement.

“Beneficial Owner” means with respect to the Bonds, the Person owning the Beneficial Ownership Interest therein, as evidenced to the satisfaction of the Trustee.

“Beneficial Ownership Interest” means the right to receive payments and notices with respect to the Bonds held in a Book-Entry System.

“Bond Counsel” means (a) Butler Snow LLP or (b) any Independent Counsel of nationally recognized standing in matters pertaining to the validity of, and exclusion from gross income for federal income tax purposes of interest on, obligations issued by states and political subdivisions, familiar with the transactions contemplated under the Indenture appointed by the Borrower and reasonably acceptable to the Authority.

“Bond Documents” means the Indenture and the Borrower’s Documents.

“Bond Fund” means each trust fund by that name created pursuant to Section 5.01 of the Indenture.

“Bond Obligation” means the then outstanding principal amount of the Bonds.

A-2

“Bond Payment Date” means any Interest Payment Date, any Principal Payment Date and any other date on which the principal of, premium, if any, or interest on the Bonds is to be paid to the Holders thereof, whether upon redemption, at maturity or upon acceleration of maturity of the Bonds.

“Bond Year” means the period from and including the date of issuance of the Series 2017 Bonds through [June 30, 2017], and thereafter each year beginning on [July 1] and ending on the earlier of the following [June 30], as applicable, or the maturity of the Series 2017 Bonds (whether by redemption, acceleration or otherwise).

“Bonds” means collectively the Series 2017 Bonds and any Additional Bonds.

“Book-Entry Form” or “Book-Entry System” means, with respect to the Bonds, a form or system, as applicable, under which (a) physical Bond certificates in fully registered form are issued only to a Depository or its nominee, with the physical Bond certificates “immobilized” in the custody of the Depository and (b) the ownership of book-entry interests in Bonds and Debt Service thereon may be transferred only through a book-entry made by others than the Authority or the Trustee. The records maintained by others than the Authority or the Trustee constitute the written record that identifies the owners, and records the transfer, of book-entry interests in those Bonds and Debt Service thereon.

“Borrower” means 2016 AVHG Cove, LLC, a Louisiana limited liability company, and its authorized successors and assigns.

“Borrower’s Documents” means, collectively, the Loan Agreement, the Mortgage, the Series 2017 Note, the Land Use Restriction Agreement, the Continuing Disclosure Agreement, the Tax Agreement, the Management Agreement, [the Development Services Agreement], the Asset Management Agreement and the Collateral Assignment of Documents together with all other documents or instruments executed by the Borrower evidencing or securing the Borrower’s obligations under the Loan Agreement, in each case as originally executed or as it may thereafter be amended or supplemented in accordance with its respective terms.

“Borrower’s Representative” means each person at the time designated to act on behalf of the Borrower, by written certificate furnished to the Authority and the Trustee on behalf of the Borrower, containing the specimen signature of such person and any designated alternates.

“Budget” means the budget described in Section 6.8 of the Loan Agreement.

“Business Day” means any day other than a (a) Saturday, (b) Sunday, (c) day on which banking institutions in (i) any city in which the designated corporate trust or principal operations offices of the Trustee (such city being initially Dallas, Texas) are located, (ii) the State or (iii) the City of New York, New York, are authorized or obligated by law or executive order to be closed, or (d) day on which the New York Stock Exchange is closed.

“Certified Public Accountant” means any Person who is Independent, appointed by the Borrower, actively engaged in the business of public accounting and duly licensed as a certified public accountant under the laws of the State.

“Closing Date” means the date of initial issuance and delivery of the Series 2017 Bonds.

“Code” means the Internal Revenue Code of 1986, the applicable regulations (whether proposed, temporary or final) under that Code or the statutory predecessor of that Code, and any amendments of, or successor provisions to, the foregoing and any official rulings, announcements, notices and procedures regarding any of the foregoing. Unless otherwise indicated, reference to a Section of the Code means that Section of the Code, including such applicable regulations, rulings, announcements, notices and procedures.

“Collateral Assignment of Documents” means, with respect to the Project, together the Collateral Assignment of Documents, dated as of April 1, 2017, between the Borrower and the Trustee, as in effect on the Closing Date and as it may thereafter to be amended or supplemented from time to time in accordance with its terms.

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“Compliance Certificate” means a certificate of a Borrower’s Representative stating that, as of the date of such certificate, the Borrower is in compliance with all requirements of the Borrower’s Documents.

“Condemnation Award” means the total condemnation proceeds paid by the condemner as a result of condemnation or eminent domain proceedings with respect to all or any part of the Project or of any settlement or compromise of such proceedings.

“Confirmation of Rating” means a written confirmation, obtained prior to the event or action under scrutiny, from the Rating Agency then rating any Outstanding Bonds to the effect that, following the proposed action or event under scrutiny at the time such confirmation is sought, the rating or ratings of the Rating Agency with respect to all Bonds then Outstanding and then rated by the Rating Agency will not be downgraded, suspended, qualified or withdrawn as a result of such action or event.

“Consultant” means a Person who is Independent, appointed by the Borrower, and who is nationally recognized as being expert as to matters for which its certificate or advice is required or contemplated.

“Continuing Disclosure Agreement” means the Continuing Disclosure Agreement dated as of April 1, 2017 between the Borrower and the Dissemination Agent, as in effect on the Closing Date and as it may thereafter be amended or supplemented from time to time in accordance with its terms.

“Controlled Group” means a group of entities directly or indirectly controlled by the same entity or group of entities. An entity or group of entities (the “controlling entity”) directly controls another entity (the “controlled entity”), in general, if it possesses either of the following rights or powers and the rights or powers are discretionary and non-ministerial: (a) the right or power both to approve and to remove without cause a controlling portion of the governing body of the controlled entity; or (b) the right or power to require the use of funds or assets of the controlled entity for any purpose of the controlling entity. A controlling entity indirectly controls all entities controlled, directly or indirectly, by an entity controlled by such controlling entity.

“Controlling Holders” means, as of any date, in the case of consent or direction to be given hereunder, the Holders of the majority in aggregate principal amount of the then Outstanding Senior Bonds, or, if not Senior Bonds are Outstanding, the Holders of the majority in aggregate principal amount of the then Outstanding Subordinate Bonds.

“Costs of Issuance” means all fees, costs and expenses payable or reimbursable directly or indirectly by the Authority or the Borrower and related to the authorization, issuance and sale of the Bonds.

“Costs of Issuance Account” means the account by that name in the Project Fund created pursuant to Section 5.01 of the Indenture.

“Costs of the Project” means those costs and expenses in connection with the acquisition, rehabilitation, furnishing, and equipping of the Project permitted by the Act to be paid or reimbursed from Bond proceeds including, but not limited to, the following:

(i) payment of (i) the cost of the preparation of plans and specifications (including any preliminary study or planning of the Project, the renovations to the Project or any aspect thereof), (ii) the cost of acquisition, construction and rehabilitation of the Project and all acquisition, construction, rehabilitation and installation expenses required to provide utility services or other facilities and all real or personal properties deemed necessary in connection with the Project (including development, architectural, engineering, and supervisory services with respect to any of the foregoing), (iii) interest on the Bonds during the construction or rehabilitation of the Project, and (iv) any other costs and expenses relating to the Project;

(ii) payment of the purchase price of the Project, improvements thereon, and the Equipment, and any fixtures to be incorporated into the Project, including all costs incident thereto, payment for labor, services, materials, and supplies used or furnished in site improvement and in the rehabilitation, furnishing

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and equipping of the Project, including all costs incident thereto, payment for the cost of the construction, rehabilitation, acquisition, and installation of utility services or other facilities, payment for all real and personal property deemed necessary in connection with the Project, payment of consulting and development fees payable to the Borrower or others, and payment for the miscellaneous expenses incidental to any of the foregoing items including the premium on any surety bond;

(iii) payment to the Trustee, as such payments become due, of the reasonable fees and expenses of the Trustee, including attorneys’ fees, other than its initial fee (as Trustee, bond registrar, dissemination agent and paying agent) and of any paying agent properly incurred under the Indenture that may become due during the rehabilitation and equipping of the Project;

(iv) to such extent as they are not paid by a contractor for construction or installation with respect to any part of the Project, payment of the premiums on all insurance required to be taken out and maintained during the period of rehabilitation and equipping of the Project;

(v) payment of the taxes, assessments, and other charges, if any, that may become payable during the period of construction or rehabilitation of the Project;

(vi) payment of expenses incurred in seeking to enforce any remedy against any contractor or subcontractor in respect of any default under a contract relating to the Project;

(vii) payment of the fees or out-of-pocket expenses of the Borrower, if any, including, but not limited to, architectural, engineering, and supervisory services with respect to the Project;

(viii) payment of the fees or out-of-pocket expenses, if any, of those providing services with respect to the Project, including, but not limited to, architectural, engineering, and supervisory services;

(ix) payment to the Borrower of such amounts, if any, as are necessary to reimburse the Borrower in full for all advances and payments made by it for any of the items set forth in (a) through (h) above; and

(x) payment of any other costs and expenses relating to the Project that would constitute a “cost” or “expense” permitted to be paid by the Authority under the Act.

“Counsel” means an attorney or firm of attorneys duly admitted to practice law before the highest court of any state and not unsatisfactory to the Trustee or the Authority.

“Coverage Test” means that the Debt Service Coverage Ratio for the relevant period was equal to or greater than 1.25 to 1 on all Outstanding Senior Bonds and all Senior Parity Indebtedness and 1.15 to 1 on all Outstanding Senior Bonds and Subordinate Bonds and all Senior Parity Indebtedness and Subordinate Parity Indebtedness.

“Dated Date” means the date of issuance and delivery of the Bonds.

“Debt Service” means the principal and redemption price of and interest due on the Bonds on any given Interest Payment Date.

“Debt Service Coverage Ratio” means, for any period, the ratio obtained by dividing Net Income Available for Debt Service for such period by the Annual Debt Service for such period, expressed as a percentage, in each case, as calculated by the Borrower and certified to the Trustee in writing and supported by the Audited Financial Statements described in the Loan Agreement.

“Debt Service Requirements” means for a specified period: (a) amounts needed to pay scheduled payments of principal of the Bonds during such period, including payments for mandatory sinking fund redemption pursuant to Section 3.03 of the Indenture; (b) amounts needed to pay interest on the Bonds payable during such

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period; and (c) to the extent not duplicative of (a) or (b) above, amounts paid during such period to restore the amounts on deposit in the Debt Service Reserve Fund to the Debt Service Reserve Requirement.

“Debt Service Reserve Account” means, as applicable, (i) the trust account by that name for the Senior Bonds in the Debt Service Reserve Fund created pursuant to Section 5.01 of the Indenture or (ii) the trust account for the Subordinate Bonds by that name in the Debt Service Reserve Fund created pursuant to Section 5.01 of the Indenture.

“Debt Service Reserve Fund” means the trust fund of that name created with respect to the Series 2017 Bonds pursuant to Section 5.01 of the Indenture.

“Debt Service Reserve Requirement” means, with respect the Series 2017A Bonds, the amount of $[_____], with respect the Series 2017B Bonds, the amount of $[_____], and with respect to the Subordinate Bonds, the amount of $[_____]; provided, however, that the foregoing amounts shall be reduced, at the written direction of the Borrower, on a pro-rata basis to the extent of any reduction in Annual Debt Service on the aggregate principal amount of the Series 2017A Bonds Outstanding, Series 2017B Bonds Outstanding and any Subordinate Bonds Outstanding, as applicable, if any Bonds are redeemed other than pursuant to mandatory sinking fund redemption.

“Default” or “Event of Default” under the Loan Agreement means any of the events described in Section 7.1 of the Loan Agreement.

“Default Rate” with respect to the Loan and Bonds, means the interest rate on the applicable Loan or the applicable Series of Bonds plus 2% per annum, and with respect to any other amounts due means 10% per annum, but in no case in excess of the maximum rate allowed under State law.

“Depository” means, with respect to the Bonds, DTC, until a successor Depository shall have become such pursuant to the applicable provisions of the Indenture, and thereafter, Depository shall mean the successor Depository. Any Depository shall be a securities depository that is a clearing agency under a federal law operating and maintaining, with its participants or otherwise, a Book-Entry System to record ownership of book-entry interests in Bonds or Debt Service thereon, and to effect transfers of book-entry interests in Bonds.

“Designated Office” means, when referring to the Trustee or any Paying Agent, means the office where the Trustee or Paying Agent, as applicable, maintains its designated corporate trust department, which as of the date of the Indenture, shall be the address provided in Section 12.07.

“Dissemination Agent” means Disclosure Advisors, LLC, or any successor thereto, acting as Dissemination Agent under the Continuing Disclosure Agreement.

“Dissemination Agent Fee” means a fee payable to the Dissemination Agent in an annual amount set forth in the then current Budget payable semi-annually in advance on the Closing Date (pro-rated to the initial Interest Payment Date) and on each Interest Payment Date thereafter; provided such fee shall not exceed $1,000 annually, as compensation for its services and expenses in performing its obligations under the Continuing Disclosure Agreement.

“DTC” means The Depository Trust Company (a limited purpose trust company), New York, New York, and its successors or assigns.

“DTC Participant” means any participant contracting with DTC under its Book-Entry system and includes securities brokers and dealers, banks and trust companies and clearing corporations.

“Environmental Laws” means Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”), Public Law No. 96-510, 94 Stat. 1613; the Resource Conservation and Recovery Act (“RCRA”), the National Environmental Policy Act of 1969, as amended (42 U.S.C. § 4321 et seq.); the Solid Waste Disposal Act (42 U.S.C. §§ 6901 et seq.); the Hazardous Material Transportation Act, as amended (49 U.S.C. §§ 1801 et seq.); the Federal Insecticide, Fungicide, and Rodenticide Act, as amended (7 U.S.C. §§ 136 et seq.);

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RCRA; the Toxic Substance Control Act, as amended (15 U.S.C. §§ 2601 et seq.); the Clean Water Act; the Clean Air Act, as amended (42 U.S.C. §§ 7401 et seq.); the Federal Water Pollution Control Act, as amended (33 U.S.C. §§ 1251 et seq.); the Federal Coastal Zone Management Act, as amended (16 U.S.C. §§ 1451 et seq.); the Occupational Safety and Health Act, as amended (29 U.S.C. §§ 651 et seq.); the Safe Drinking Water Act, as amended (42 U.S.C. §§ 300(f) et seq.); and any other federal, state, or local law, statute, ordinance, and regulation, now or hereafter in effect, and in each case as amended or supplemented from time to time, and any applicable judicial or administrative interpretation thereof, including, without limitation, any applicable judicial or administrative order, consent decree, or judgment applicable to the Project relating to the regulation and protection of human health and safety and/or the environment and natural resources (including, without limitation, ambient air, surface water, groundwater, wetlands, land surface or subsurface strata, wildlife, aquatic species, and/or vegetation), including all amendments to such Acts, and any and all regulations promulgated thereunder, and all analogous local or state counterparts or equivalents, and any transfer of ownership notification or approval statutes, and any federal, state or local statute, law, ordinance, code, rule, regulation, order or decree, regulating, relating to or imposing liability or standards of conduct concerning any petroleum, petroleum byproduct (including but not limited to, crude oil, diesel oil, fuel oil, gasoline, lubrication oil, oil refuse, oil mixed with other waste, oil sludge, and all other liquid hydrocarbons, regardless of specific gravity) natural or synthetic gas, products and/or hazardous substance or material, toxic or dangerous waste, substance or material, pollutant or contaminant, as may now or at any time hereafter be in effect.

“Equipment” means the equipment, machinery, furnishings and other personal property located on the Site and all replacements, substitutions, and additions thereto

“Event of Default” means any occurrence or event specified in Section 8.01 of the Indenture.

“Extraordinary Expenses” means all reasonable expenses properly incurred by the Trustee and any Co- Trustee under the Indenture, other than Ordinary Expenses.

“Extraordinary Services” means all reasonable services rendered by the Trustee and any Co-Trustee under the Indenture, other than Ordinary Services.

“Extraordinary Trustee’s Fees and Expenses” means the fees, expenses and disbursements payable to the Trustee and Paying Agent pursuant to Section 9.04 of the Indenture during any Fiscal Year in excess of Ordinary Trustee’s Fees and Expenses, including but not limited to, reasonable counsel fees and expenses, reasonable fees of other third party professionals, and any costs of sending notices pursuant to the terms and conditions of the Bond Documents, including but not limited to, Section 3.06 of the Indenture.

“Favorable Opinion of Bond Counsel” means, with respect to any action the taking of which requires such an opinion, an opinion of Bond Counsel addressed to the Authority and the Trustee to the effect that such action will not, in and of itself, cause interest on the Bonds to be includible in gross income for federal income tax purposes (subject to the inclusion of any exceptions contained in the opinion delivered upon the original issuance of the Bonds).

“Fiduciary” means the Trustee and any Paying Agent.

“Fiscal Year” means a period of 12 consecutive months ending on December 31, except that the first Fiscal Year shall begin on the Closing Date and end on December 31, 2017.

“Fitch” means Fitch Ratings, Inc., a corporation organized and existing under the laws of the State of New York, its successors and assigns.

“Force Majeure” means (a) the following: acts of nature; strikes or other industrial disturbances; acts of public enemies; orders or restraints of any kind of the government of the United States of America or of the State or of any of their subdivisions, departments, agencies or officials, or of any civil or military authority; insurrections; riots; landslides; earthquakes; fires; floods; explosions, but only to the extent that any such cause or event is not

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within the control of the Borrower; and (b) any other cause or event not reasonably within the control of the Borrower.

“Fund” or “Funds” means any one or more, as the case may be, of the separate trust funds created and established in Article V of the Indenture.

“GAAP” means generally accepted accounting principles consistently applied.

“Governing Body” means (a), with respect to the Authority, the Board of Directors of the Authority, or any governing body that succeeds to the functions of the Board of Directors of the Authority, and (b) with respect to a Borrower, the Board of Directors of the Sole Member.

“Government Obligations” means direct obligations of the United States of America or obligations the full and timely payment of the principal of and interest on which is unconditionally guaranteed by the United States of America.

“Hazardous Substances” means any petroleum or petroleum products and their by-products, flammable explosives, radioactive materials, toxic chemicals and substances, radon, asbestos in any form that is or could become friable, urea formaldehyde foam insulation and polychlorinated biphenyls (PCB), asbestos-containing materials (ACMs), lead-containing or lead-based paint (LBP), radon, medical waste and other bio-hazardous materials and any chemicals, pollutants, materials or substances defined as or included in the definition of “hazardous substances” as defined pursuant to the federal Comprehensive Environmental Response, Compensation and Liability Act, “regulated substances” within the meaning of subtitle I of the federal Resource Conservation and Recovery Act and words of similar import under applicable Environmental Laws.

“Holder” or “Bondholder” means the Person or Persons in whose name any Bond is registered on the registration records for the Bonds maintained by the Trustee as registrar.

“Indebtedness” means (a) all indebtedness, whether or not represented by bonds, debentures, notes or other securities, for the repayment of money borrowed, (b) all deferred indebtedness for the payment of the purchase price of properties or assets purchased, (c) all guaranties, endorsements (other than endorsements in the ordinary course of business), assumptions, and other contingent obligations in respect of, or to purchase or to otherwise acquire, indebtedness of others, (d) all indebtedness secured by a mortgage, or secured by a pledge, security interest, or lien existing on property owned which is subject to a mortgage, pledge, security interest, or lien, whether or not the indebtedness secured thereby has been assumed, (e) all capitalized lease obligations, (f) all unfunded amounts under a loan agreement, letter of credit, or other credit facility for which such Person would be liable, if such amounts were advanced under the credit facility, (g) all amounts required to be paid by the Borrower as a guaranteed payment to partners or members or a preferred or special dividend, including any mandatory redemption of shares or interests, (h) all unfunded pension funds, or welfare or pension benefit plans or liabilities, and (i) all obligations (calculated on a net basis) of the Borrower under derivatives in the form of interest rate swaps, credit default swaps, total rate of return swaps, caps, floors, collars and other interest hedge agreements, in each case whether the Borrower is liable contingently or otherwise, as obligor, guarantor or otherwise, or in respect of which obligations the Borrower otherwise assures a creditor against loss; provided, however, that for the purpose of computing Indebtedness, there will be excluded any particular Indebtedness if, upon or prior to the maturity thereof, there has been deposited with the proper depository in trust the necessary funds (or Government Obligations not callable or pre-payable by the Authority thereof) for the payment, redemption, or satisfaction of such Indebtedness, and thereafter such funds and such Government Obligations so deposited will not be included in any computation of the assets of the Borrower and the income derived from such funds and such direct obligations of the United States of America so deposited will not be included in any computation of the income of the Borrower.

“Indenture” means the Trust Indenture, as in effect on the Closing Date and as it may thereafter be amended or supplemented from time to time in accordance with Article XI of the Indenture.

“Independent” means, with respect to Counsel or any Consultant, a person who is not a member of the Governing Body of the Authority or the Borrower and is not an officer or employee of the Authority or the

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Borrower and which is not a partnership, corporation or association having a partner, director, officer, member or substantial stockholder who is a member of the Governing Body of the Authority or the Borrower or who is an officer or employee of the Authority or the Borrower; provided, however, that the fact that such person is retained regularly by or transacts business with the Authority shall not make such person an employee within the meaning of this definition.

“Insurance and Tax Escrow Fund” means the trust fund by that name established pursuant to Section 5.01 of the Indenture.

“Insurance Consultant” means a Consultant having the skill and expertise necessary to evaluate the insurance needs of multifamily rental housing and which may be a broker or agent with which the Borrower or the Authority transacts business.

“Insurance Proceeds” means the total proceeds of insurance paid by an insurance company under the policies of property insurance required to be procured by the Borrower pursuant to the Loan Agreement.

“Interest Account” means, as applicable, (i) the trust account by that name for the Senior Bonds in the Bond Fund created with respect to the Bonds pursuant to Section 5.01 of the Indenture or (ii) the trust account by that name for the Subordinate Bonds in the Bond Fund created pursuant to Section 5.01 of the Indenture.

“Interest Payment Date” means each June 1 and December 1, commencing June 1, 2017, until the final Principal Payment Date of the Bonds.

“Interest Period” for any Bonds means initially the period from the Dated Date to but not including the first Interest Payment Date and thereafter the period from and including each Interest Payment Date to but not including the next Interest Payment Date or other date on which interest is required to be paid on such Bonds.

“Interest Requirement” for any Bonds means an amount equal to the interest that would be due and payable on such Bonds on the Interest Payment Date next succeeding the date of determination (assuming that no principal of such Bonds is paid or redeemed between such date and the next succeeding Interest Payment Date) multiplied by a fraction the numerator of which is one and the denominator of which is the number of whole calendar months in the Interest Period in which such date occurs.

“Land” means the real property upon which the Project is located.

“Land Use Restriction Agreement” means the Tax Regulatory Agreement, dated the Closing Date, among the Authority, the Borrower, and the Trustee, as it may thereafter be amended and supplemented from time to time in accordance with its terms.

“LCDA Act” shall mean Chapter 10-D of Title 33 of the Louisiana Revised Statutes of 1950, as amended (La. R.S. 33:4548.1 through 4548.16, as amended).

“Liquidity Requirement” means an amount of monies in the Repair and Replacement Fund and Surplus Fund, collectively, equal to no less than thirty (30) days of Operating Expenses.

“Loan” means the loan evidenced by the Series 2017 Note from the Borrower to the Authority and assigned to the Trustee, financed by the Authority with proceeds of the Series 2017 Bonds in the aggregate principal amount of $[______].

“ Loan Agreement” means the Loan Agreement of even date herewith between the Authority and the Borrower, as in effect on the Closing Date and as it may thereafter be amended and supplemented from time to time in accordance with its terms.

“Loan Payments” means, collectively, the “Basic Loan Payments” and the “Additional Loan Payments.”

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“Long-Term Indebtedness” means any Indebtedness other than Short-Term Indebtedness.

“Mail” means either (a) first class mail by the United States Postal Service, postage prepaid, to the Holders at their respective addresses which appear on the registration books of the Paying Agent on the date of mailing, or (b) actual delivery to the Holders or their representatives evidenced by receipt signed by such Holders or their representatives.

“Management Agreement” means any agreement for the management, maintenance and operation of the Project, between the Manager and the Borrower, or any substitute agreement providing for the management, maintenance and operation of the Project, in each case as it may be amended and supplemented from time to time.

“Management Consultant” means a Consultant possessing significant management consulting experience in matters pertaining to owning and operating multifamily residential rental housing facilities similar to the Project.

“Management Fee” means any and all compensation payable to the Manager under and pursuant to the Management Agreement.

“Manager” means any property manager under any Management Agreement which subsequent manager satisfies the requirements of Section 4.7 of the Loan Agreement as manager of the Project.

“Mandatory Sinking Fund Requirements” means (i) with respect to Series 2017A Bonds, the amounts required to be deposited in the Bond Fund for the purpose of redeeming the Series 2017A Bonds pursuant to Section 3.03(a) of the Indenture and (ii) with respect to Series 2017B Bonds, the amounts required to be deposited in the Bond Fund for the purpose of redeeming the Series 2017B Bonds pursuant to Section 3.03(b) of the Indenture.

“Material Adverse Effect” means (a) a material adverse change in the financial condition of the Borrower or the Project; or (b) any event or occurrence of whatever nature which would materially and adversely change (i) the Borrower’s ability to perform its obligations under the Loan Agreement or any other Borrower’s Documents; or (ii) the Holders’ or the Trustee’s security interests in the security pledged hereunder or under any other Borrower Document.

“Maximum Annual Debt Service” means as of any date of calculation the highest principal and interest requirements with respect to all Outstanding Bonds of the applicable Series for any succeeding Fiscal Year, but excluding the period ending on the final Principal Payment Date of the Bonds.

“Modifications” means modifications, repairs, renewals, improvements, replacements, alterations, additions, enlargements, or expansions in, on, or to the Project (other than routine repair or maintenance), including any and all machinery, furnishings, and equipment therefor.

“Moody’s” means Moody’s Investors Service, a corporation organized and existing under the laws of the State of Delaware, its successors and their assigns.

“Mortgage” means, the Multiple Indebtedness Mortgage, Security Agreement and Assignment of Leases and Rents, dated the Closing Date, from the Borrower in favor of the Trustee, securing the repayment of the Loan and the Series 2017 Note and certain additional amounts due and owing under the Loan Agreement, as in effect on the Closing Date and as it may thereafter be amended and supplemented from time to time in accordance with its terms.

“Mortgaged Property” means the real property and all improvements thereon on which the Project is located which is subject to the lien of the Mortgage and the Indenture, as more specifically described in Exhibit A to the Mortgage.

“Needs Assessment Analysis” means the analysis and report required as set forth in Section 4.12 of the Loan Agreement.

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“Net Income Available for Debt Service” means, for any period of determination thereof, Project Revenues for such period, plus all interest earnings on money held in Funds and Accounts which are transferred to the Revenue Fund pursuant to Article VI of the Indenture, minus (a) total Operating Expenses incurred on a GAAP basis by the Borrower for such period, (b) all required deposits to the Insurance and Tax Escrow Fund and the Repair and Replacement Fund for such period, (c) any profits or losses which would be regarded as extraordinary items under generally accepted accounting principles, (d) gain or loss on the extinguishment of Indebtedness, (e) contributions, (f) proceeds of Additional Bonds and any other Permitted Indebtedness, (g) Net Proceeds of any Insurance Proceeds or Condemnation Award, (h) the proceeds of any sale, transfer or other disposition of all or any portion of the Project by the Borrower and (i) with respect to Net Income Available for Debt Service as it relates to the Subordinate Bonds, the Debt Service Reserve Requirement for the Senior Bonds and debt service due on any Senior Parity Indebtedness for such period.

“Net Proceeds,” when used with respect to any Insurance Proceeds or Condemnation Award, means the gross proceeds from such Insurance Proceeds or Condemnation Award, less all expenses (including reasonable attorneys’ fees of the Borrower or the Trustee and any extraordinary fees and expenses of the Trustee) incurred in the realization thereof.

“Notes” means the Series 2017 Note and any promissory note issued in connection with Additional Bonds.

“Operating Account” means, the demand deposit bank account maintained by the Borrower pursuant to Section 4.3 of the Loan Agreement on which the Borrower or its authorized agent writes checks to pay Operating Expenses.

“Operating Expenses” means, for any period, cash expenses paid or accrued in connection with the operation, maintenance and current repair of the Project (determined on a cash basis) during such period including without limitation, the costs of any utilities necessary to operate the Project, advertising and promotion costs, payroll expenses, insurance premiums, lease payments, deposits to the Insurance and Tax Escrow Fund and to the Repair and Replacement Fund in the amount of the Repair and Replacement Reserve Requirement, any Rebate Amount to the extent that it is not paid from the Rebate Fund, the Management Fee, administrative and legal expenses of the Borrower relating to the Project, labor, executive compensation, the Management Fee, the cost of materials and supplies used for current operations of the Project, taxes and charges for accumulation of appropriate reserves for current expenses not annually recurrent but which are such as may reasonably be expected to be incurred in connection with the Project and in accordance with sound accounting practice. “Operating Expenses” does not include (a) Debt Service Requirements, (b) any loss or expense resulting from or related to any extraordinary and nonrecurring items, (c) any losses or expenses related to the sale of assets, the proceeds of which sale are not included in Project Revenues pursuant to clause (b) of the definition thereof, (d) [omitted], (e) expenses paid from the Repair and Replacement Fund, (f) any Rebate Amount to the extent that it is paid from the Rebate Fund, (g) deposits in the Repair and Replacement Fund in excess of the Repair and Replacement Reserve Requirement, (h) any allowance for depreciation or replacements of capital assets of the Project or amortization of financing costs, or (i) disbursements from the Surplus Fund.

“Operating Fund” means the trust fund by that name created pursuant to Section 5.01 of the Indenture.

“Operating Requirement” means all Operating Expenses, exclusive of amounts to be deposited to or payable from the Administration Fund, Insurance and Tax Escrow Fund, or Repair and Replacement Fund, projected to be payable in such month in accordance with the Budget.

“Ordinary Expenses” means those reasonable expenses incurred in the ordinary course of business, by a trustee, a registrar, an authenticating agent and a paying agent under instruments similar to the Indenture, but excluding Extraordinary Expenses.

“Ordinary Services” means those services normally rendered by a trustee, a registrar, an authenticating agent and a paying agent under instruments similar to the Indenture, excluding Extraordinary Services.

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“Ordinary Trustee’s Fees and Expenses” means those fees, expenses and disbursements for the services normally rendered by, and the expenses incurred in the ordinary course of business of, the Trustee and Paying Agent incurred in connection with their duties under the Indenture and the other Borrower’s Documents payable annually in advance on the Closing Date and on each June 1.

“Organizational Documents” means the documents under which the Borrower or the Sole Member is organized and governed, including its Articles of Organization or Code of Regulations, respectively, as such documents are in effect on the Closing Date and as they may be thereafter amended or supplemented from time to time in accordance with their terms.

“Outstanding” or “outstanding” with respect to Bonds means, as of any given date, all Bonds which have been authenticated and delivered by the Trustee under the Indenture, except: (a) Bonds cancelled at or prior to such date or delivered to or acquired by the Trustee or Paying Agent on or prior to such date for cancellation; (b) Bonds deemed to be paid in accordance with Article VII of the Indenture; and (c) Bonds in lieu of which other Bonds have been authenticated under Section 2.08 or 2.09 of the Indenture.

“Parity Indebtedness” means the Indebtedness permitted to be secured by the Borrower pursuant to Section 6.11 of the Loan Agreement.

“Paying Agent” means the Trustee or any successor or additional Paying Agent appointed hereunder that satisfies the requirements of Section 9.18 of the Indenture.

“Permitted Encumbrances” means, with respect to the Project, the Mortgage and (a) the lien of current real property taxes (if any), ground rents, water charges, sewer rents and assessments not yet due and payable, (b) covenants, conditions and restrictions, rights of way, easements and other matters of public record, none of which, individually or in the aggregate, materially interferes with the current use of the Project or the security intended to be provided by the Mortgage, (c) the Land Use Restriction Agreement, (d) the exceptions (general and specific) set forth in the Title Policy or appearing of record, none of which, individually or in the aggregate, materially interferes with the current use of the Project or the security intended to be provided by the Mortgage, and (e) those permitted encumbrances set forth on Exhibit B to the Mortgage.

“Permitted Indebtedness” means (a) payment and other liabilities payable under the Loan Agreement or the Series 2017 Note, (b) liabilities of the Borrower under the Mortgage, and (c) Indebtedness of the Borrower allowed pursuant to Section 6.11 of the Loan Agreement.

“Permitted Investments” means dollar denominated investments, to the extent permitted by law, in any of the following:

(i) Government Obligations;

(ii) Debt obligations which are (i) issued by any state or political subdivision thereof or any agency or instrumentality of such state or political subdivision, and (ii) at the time of purchase, rated by any Rating Agency in one of the two highest categories assigned by such Rating Agency (without regard to any refinement or gradation of rating category by numerical modifier or otherwise);

(iii) any bond, debenture, note, participation certificate or other similar obligation which is either (i) issued or guaranteed by the Federal National Mortgage Association, the Federal Home Loan Bank System, the Federal Home Loan Mortgage Corporation, the Federal Farm Credit Bank, or (ii) backed by the full faith and credit of the United States of America;

(iv) U.S. denominated deposit account, certificates of deposit and banker’s acceptances with domestic commercial banks, including the Trustee or its affiliates, which have a rating on their short-term certificates of deposit on the date of purchase of “A 1” by Standard & Poor’s, “F 1+” by Fitch or “P 1” by Moody’s, without regard to gradation, and which matures not more than 360 days after the date of purchase;

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(v) commercial paper which is rated at the time of purchase within the classification or higher, “A 1” by Standard & Poor’s, “F 1+” by Fitch or “P 1” by Moody’s, without regard to gradation, and which matures not more than 270 days after the date of purchase;

(vi) bonds, notes, debentures or other evidences of indebtedness issued or guaranteed by a corporation which are, at the time of purchase, rated by any Rating Agency in any of the three highest rating categories (without regard to any refinement or gradation of rating category by numerical modifier or otherwise);

(vii) investment agreements with banks that at the time such agreement is executed are rated by any Rating Agency in one of the two highest rating categories assigned by such Rating Agency (without regard to any refinement or gradation of rating category by numerical modifier or otherwise) or investment agreements with non-bank financial institutions which, (1) all of the unsecured, direct long-term debt of either the non-banking financial institution or the related guarantor of such non-bank financial institution is rated by any Rating Agency at the time such agreement is executed in one of the two highest rating categories (without regard to any refinement or gradation of rating category by numerical modifier or otherwise) for obligations of that nature; or (2) if such non-bank financial institutions have no outstanding long-term debt that is rated, all of the short-term debt of either the non-banking financial institution or the related guarantor of such non-bank financial institution is rated by any Rating Agency in the highest rating category (without regard to any refinement or gradation of the rating category by numerical modifier or otherwise) assigned to short term indebtedness by such Rating Agency; provided that if at any time after purchase the provider of the investment agreement drops below the two highest rating categories assigned by such Rating Agency, the investment agreement must, within 30 days, either (1) be assigned to a provider rated in one of the two highest rating categories or (2) be secured by the provider with collateral securities the fair market value of which, in relation to the amount of the investment agreement including principal and interest, is equal to at least 102%; investment agreements with banks or non-bank financial institutions shall not be permitted if no rating is available with respect to debt of the investment agreement provider or the related guarantor of such provider;

(viii) repurchase agreements with respect to and secured by Government Obligations or by obligations described in clause (b) and (c) above, which agreements may be entered into with a bank (including without limitation the Trustee), a trust company, financial services firm or a broker dealer which is a member of the Securities Investors Protection Corporation, provided that (i) the Trustee or a custodial agent of the Trustee has possession of the collateral and that the collateral is, to the knowledge of the Trustee, free and clear of third-party claims, (ii) a master repurchase agreement or specific written repurchase agreement governs the transaction, (iii) the collateral securities are valued no less frequently than monthly, and (iv) the fair market value of the collateral securities in relation to the amount of the repurchase obligation, including principal and interest, is equal to at least 103%, and (v) such obligations must be held in the custody of the Trustee’s agent; and

(ix) shares of a money market mutual fund or other collective investment fund registered under the federal Investment Company Act of 1940, whose shares are registered under the Securities Act of 1933, having assets of at least $100,000,000 and having a rating AAAm or AAAm-G by a Rating Agency, including money market mutual funds from which the Trustee or its affiliates derive a fee for investment advisory or other services to the fund.

“Person” or “person” means an individual, a corporation, a partnership, an association, a joint stock company, a trust, any unincorporated organization, a governmental body, any other political subdivision, municipality or authority or any other group or entity.

“Potential Default” means any event which with the passage of time or the giving of notice, or both, would constitute an Event of Default under the Indenture or a Default under the Loan Agreement.

“Principal Account” means, as applicable, (i) the trust account by that name for the Senior Bonds within the Bond Fund created with respect to the Senior Bonds pursuant to Section 5.01 of the Indenture or (ii) the trust

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account by that name for the Subordinate Bonds within the Bond Fund for the Subordinate Bonds pursuant to Section 5.01 of the Indenture.

“Principal Payment Date” means each maturity date of the Bonds and any date for mandatory sinking fund redemption of the Bonds pursuant to Section 3.03 of the Indenture.

“Principal Requirement” for any Bonds means an amount equal to the regularly scheduled principal that is due and payable on such Bonds on the Bond Payment Date next succeeding the date of determination, whether by maturity or by mandatory sinking fund redemption pursuant to Section 3.03 of the Indenture, multiplied by a fraction the numerator of which is one and the denominator of which is the number of whole calendar months in the period commencing on the last date of payment of regularly scheduled principal (or the date of issuance of such Bonds, if no principal has been paid) and ending on the next Bond Payment Date for payment of regularly scheduled principal.

“Project” means the Site, together with the improvements constructed thereon, consisting of three residential rental facilities and related support facilities, including all buildings, structures and improvements now or hereafter constructed thereon, and all fixtures, machinery, equipment, furniture, furnishings and other personal property hereafter attached to, located in, or used in connection with any such structures, buildings or improvements, and all additions, substitutions and replacements thereto, whether now owned or hereafter acquired. The term “Project” does not include property owned by Persons other than the Borrower, including the Asset Manager, the Manager, the Sole Member or residents of the Project.

“Project Fund” means the trust fund by that name created pursuant to Section 5.01.

“Project Revenues” means for any period, all cash operating and non-operating revenues of the Project, including rental payments and Unrestricted Contributions, less (a) any extraordinary and nonrecurring items (including any real property tax refunds), (b) income derived from the sale of assets not in the ordinary course of business which is permitted under the Bond Documents, (c) security, cleaning or similar deposits of tenants until applied or forfeited, (d) Net Proceeds of Insurance Proceeds or Condemnation Awards and (e) any amount disbursed to the Borrower from the Surplus Fund, but including as Project Revenues (i) any such Net Proceeds resulting from business interruption insurance or other insurance or condemnation proceeds retained by the Borrower and (ii) amounts received by the Borrower or the Trustee pursuant to any payment guaranty, operating guaranty or similar agreement with respect to the Project.

“Qualified Insurer” has the meaning provided in Section 5.2 of the Loan Agreement.

“Rating Agency” means S&P, Moody’s or Fitch, or any other nationally recognized rating agency if such agency currently has a rating in effect with respect to any Series of the Bonds. The initial Rating Agency shall be S&P.

“Rating Agency Fee” means any fee required to be paid to a Rating Agency to maintain a rating on the Bonds, and initially means the annual surveillance fee of $1,500 payable by the Borrower to the initial Rating Agency.

“Rebate Analyst” means a Certified Public Accountant, financial analyst, law firm or Bond Counsel, or any firm of the foregoing, or a financial institution (which may include the Trustee) experienced in making the arbitrage and rebate calculations required pursuant to Section 148 of the Code and retained by the Borrower to make the computations and give the directions required pursuant to the Tax Agreement.

“Rebate Analyst Fee” means a fee paid for each rebate calculation (which are to be made every fifth year, if required).

“Rebate Fund” means the trust fund by that name created pursuant to Section 5.01 of the Indenture.

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“Record Date” means the fifteenth day (whether or not a Business Day) of the calendar month preceding any applicable Interest Payment Date.

“Related Person” means any member of the same Controlled Group as the Authority or the Borrower.

“Repair and Replacement Fund” means the trust fund by that name established pursuant to Section 5.01 of the Indenture.

“Replacement Reserve Requirement” means an amount equal to the greater of (a) $300 per unit per year, as increased pursuant to any Needs Assessment Analysis required by Section 4.12 of the Loan Agreement.

“Reserved Rights” of the Authority means (a) the right of the Authority to amounts payable to it pursuant to Section 3.2(b)(ii)(3) of the Loan Agreement, (b) all rights which the Authority or its officers, officials, agents, attorneys or employees may have under the Indenture and the Borrower Documents to indemnification by the Borrower and by any other persons and to payments and reimbursements for fees or expenses incurred by the Authority itself, or its officers, officials, agents, attorneys or employees; (c) the right of the Authority to receive notices, reports or other information, make determinations and grant approvals hereunder and under the other Bond Documents, including rights to notice and reporting requirements and restrictions on transfer of ownership of the Project or the Bonds, and its right to inspect and audit the books, records and premises of the Borrower and the Project; (d) all rights of the Authority to enforce the representations, warranties, covenants and agreements of the Borrower pertaining in any manner or way, directly or indirectly, to the requirements of the Act or of the Authority, and set forth in any of the Bond Documents, in the Tax Agreement or in any other certificate or agreement executed by the Borrower; (e) all rights of the Authority in connection with the approval, execution and delivery of any amendment to or modification of the Bond Documents; (f) all enforcement remedies of the Authority with respect to the foregoing; and (g) the right of the Authority to inspect the project.

“Responsible Officer,” when used with respect to the Trustee, means any corporate trust officer or assistant corporate trust officer or any other officer of the Trustee within its corporate trust department customarily performing functions similar to those performed by any of the above designated officers, and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of such person’s knowledge of and familiarity with the particular subject.

“Restoration” means the restoration, replacement, repair or rebuilding of the Project as a result of an event for which Condemnation Awards or Insurance Proceeds are received with respect to the Project, as provided in Section 5.3 of the Loan Agreement.

“Restoration Plans” has the meaning provided in Section 5.3 of the Loan Agreement.

“Revenue Bond Act” means Chapter 13 of Title 39 the Louisiana Revised Statutes of 1950, as amended.

“Revenue Fund” means the trust fund by that name created pursuant to Section 5.01 of the Indenture.

“S&P” means Standard & Poor’s Rating Services, a Standard & Poor’s Financial Services, LLC business, its successors and assigns.

“Senior Bonds” means the Series 2017A Bonds, the Series 2017B Bonds and any Additional Bonds issued on a parity therewith.

“Senior Parity Indebtedness” means any Parity Indebtedness properly incurred on parity with the Senior Bonds as provided for in the Loan Agreement.

“Series” means any series of Bonds issued pursuant to the Indenture.

“Series 2017 Bonds” means the Series 2017A Bonds and the Series 2017B Bonds.

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“Series 2017A Bonds” means $[_____] aggregate principal amount of the Authority’s Multifamily Housing Revenue Bonds (The Cove at NOLA Apartments), Series 2017A, which Bonds are senior in lien and priority to the Series 2017B Bonds.

“Series 2017B Bonds” means $[_____] aggregate principal amount of the Authority’s Multifamily Housing Revenue Bonds (The Cove at NOLA Apartments), Subordinate Series 2017B, which Bonds are subordinate in lien and priority to the Senior Bonds.

“Series 2017 Note” means the note executed by the Borrower in favor of the Authority on behalf of the Holders evidencing the Loan of the proceeds of the Series 2017 Bonds and endorsed to the Trustee.

“Short-Term Indebtedness” means any Indebtedness maturing not more than 365 days after it is incurred or which is payable on demand, except for any such Indebtedness which is renewable or extendable at the sole option of the debtor to a date more than 365 days after it is incurred, or any such Indebtedness which, although payable within 365 days, constitutes payments required to be made on account of Indebtedness expressed to mature more than 365 days after it was incurred.

“Site” means the real property on which the Project is located.

“Sole Member” means Invest in America’s Veterans Foundation, Inc., a Florida not-for-profit corporation described in Section 501(c)(3) of the Code and exempt from federal income taxation under Section 501(a) of the Code, as Sole Member of the Borrower, and its successors and assigns.

“Special Redemption Account” means each trust account by that name within the Bond Fund created with respect to a Series of Bonds pursuant to Section 5.01 of the Indenture.

“State” means the State of Louisiana.

“Subordinate Bonds” means the Series 2017B Bonds and any Additional Bonds issued on parity therewith.

“Subordinate Parity Indebtedness” means any Parity Indebtedness properly incurred on parity with the Subordinate Bonds as provided in Section 6.11 of the Loan Agreement.

“Supplemental Indenture” means any Amendment to the Indenture entered into in accordance with Article XI of the Indenture.

“Surplus Cash” means the amount on deposit in the Surplus Fund that may be distributed to the Borrower pursuant to Section 5.13(b) of the Indenture.

“Surplus Fund” means the trust fund by that name created pursuant to Section 5.01 of the Indenture.

“Tax Agreement” means together, the Tax Regulatory Agreement and No-Arbitrage Certificate, dated the Closing Date, executed by the Authority, the Trustee, the Borrower and the Sole Member, as in effect on the Closing Date, as the same may be supplemented or amended from time to time in accordance with its terms.

“Test Period” means the Fiscal Year ending on an Annual Evaluation Date.

“Title Policy” means title insurance in the form of an ALTA mortgagee’s Title Policy issued by a title insurance company acceptable to the Underwriter in the face amount of at least the principal amount of Series 2017 Bonds insuring that the Trustee has a first priority valid lien in the Mortgaged Property subject only to Permitted Encumbrances.

“Trust Estate” means the property conveyed to the Trustee hereunder, including all of the Authority’s right, title and interest in and to the property described in the Granting Clauses of the Indenture.

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“Trustee” means Wilmington Trust, National Association, or any successors or assigns hereunder.

“Underwriter” means Stifel Nicolaus & Company, Incorporated, and its successors and assigns.

“Unrestricted Contributions” means contributions that are not restricted in any way that would prevent their application to the payment of Debt Service on Indebtedness of the Borrower.

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APPENDIX B

SUMMARIES OF CERTAIN PROVISIONS OF THE PRINCIPAL DOCUMENTS

The following are summaries of certain provisions of the Indenture, the Loan Agreement, the Mortgage and the Land Use Restriction Agreement. These summaries do not purport to be complete and are subject in all respects to the provisions of, and are qualified in their entirety by reference to, the complete text of such documents. Copies of the foregoing documents are available from the Trustee.

Table of Contents THE INDENTURE THE LOAN AGREEMENT THE MORTGAGE THE LAND USE RESTRICTION AGREEMENT

THE INDENTURE

The following is a brief summary of certain provisions of the Indenture. The summary does not purport to be complete or definitive and is qualified in its entirety by reference to the Indenture, a copy of which is on file with the Trustee.

Funds and Accounts

The following Funds and accounts are created by the Authority to be held by the Trustee:

(x) A Bond Fund and therein (i) a Principal Account with respect to the Senior Bonds, and within such Principal Account (A) a Tax-Exempt Bond Fund Principal Subaccount and (B) a Taxable Bond Fund Principal Subaccount, (ii) an Interest Account with respect to the Senior Bonds, and within such Interest Account (A) a Tax-Exempt Bond Fund Interest Subaccount and (B) a Taxable Bond Fund Interest Subaccount, (iii) a Special Redemption Account with respect to the Senior Bonds, and within such Special Redemption Account (A) a Tax-Exempt Bond Fund Special Redemption Subaccount and (B) a Taxable Bond Fund Special Redemption Subaccount, (iv) a Principal Account with respect to the Subordinate Bonds, (v) an Interest Account with respect to the Subordinate Bonds and (vi) a Special Redemption Account with respect to the Subordinate Bonds;

(xi) A Debt Service Reserve Fund, and therein (i) a Debt Service Reserve Account with respect to the Senior Bonds, and within such Debt Service Reserve Account (A) a Tax-Exempt Debt Service Reserve Subaccount, and (B) a Taxable Debt Service Reserve Subaccount, and (ii) a Debt Service Reserve Account with respect to the Subordinate Bonds;

(xii) A Project Fund and therein a Costs of Issuance Account;

(xiii) A Revenue Fund;

(xiv) A Rebate Fund;

(xv) An Operating Fund;

(xvi) [omitted];

(xvii) An Insurance and Tax Escrow Fund;

(xviii) A Repair and Replacement Fund;

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(xix) An Administration Fund; and

(xx) A Surplus Fund.

Disbursements from the Project Fund. The Trustee will disburse money in the Costs of Issuance Account in the Project Fund to pay the Costs of Issuance upon receipt of a written requisition of the Borrower or a closing memorandum prepared by the Underwriter and signed by the Borrower or a closing statement to the Trustee which states (i) that such amount is to be paid to persons, firms or corporations identified therein, and (ii) that such amount is properly payable as a Cost of Issuance under the Indenture. On the six month anniversary of the Closing Date, the Trustee will pay any remaining balance in the Costs of Issuance Account to the Project Fund.

Amounts on deposit in the Project Fund will be applied to payment of the Costs the Project and paying the costs of issuing the Bonds by disbursement thereof in accordance with one or more requisitions of the Borrower to the Trustee within 30 days of receipt of such requisition substantially in the form set forth as Exhibit B-1 to the Loan Agreement.

The Trustee may conclusively rely and will be protected in acting or refraining upon the form of requisition of the Borrower, which may be submitted by facsimile or email (pdf format). The Trustee will not be bound to make an investigation into the facts or matters stated in any form of requisition of the Borrower. The Trustee will not be responsible for determining whether the funds on hand in the Project Fund are sufficient to complete the Costs of the Project. The Trustee will not be responsible for collecting lien waivers.

Net Proceeds of any Insurance Proceeds or Condemnation Awards deposited in the Project Fund pursuant to the Loan Agreement will be applied as provided in the Loan Agreement.

Any amounts remaining in the Project Fund on the date that is three years from the Closing Date (in the case of original and investment proceeds of the Bonds, or the date of deposit of such amounts into the Project Fund, in the case of other amounts) will be deposited in the Interest Account of the Bond Fund with respect to the Senior Bonds unless otherwise required by the Tax Agreement.

Revenue Fund. There will be deposited in the Revenue Fund (i) all Loan Payments and other amounts paid to the Trustee under the Loan Agreement (other than prepayments required to redeem Bonds pursuant to the Indenture, which will be deposited in the related Special Redemption Account), (ii) all other amounts required to be so deposited pursuant to the terms of the Indenture or of the Tax Agreement, including investment earnings to the extent provided in the Indenture, (iii) any amounts derived from the Loan Agreement or the Mortgage to be applied to payment of amounts intended to be paid from the Revenue Fund, (iv) all Project Revenues, and (v) such other money as is delivered to the Trustee by or on behalf of the Authority or the Borrower with directions for deposit of such money in the Revenue Fund.

Moneys on deposit in the Revenue Fund will be disbursed on the 15th day of each month as described in the front part of this Official Statement under “SECURITY AND SOURCES OF PAYMENT OF THE BONDS – Revenue Fund.”

Deposits into the Bond Fund; Use of Moneys in the Bond Fund. There will be deposited into the respective Principal Accounts of the Bond Fund (i) money transferred to such Principal Account from the Revenue Fund pursuant to the Indenture, (ii) money transferred from the Surplus Fund, the Repair and Replacement Fund, the Debt Service Reserve Fund and the Operating Fund pursuant to the Indenture in respect of principal payable on the Bonds and (iii) any other amounts deposited with the Trustee with directions from the Borrower Representative to deposit the same in applicable Principal Account of the Bond Fund.

There will be deposited into the respective Interest Accounts of the Bond Fund (i) all accrued interest, if any, on the sale and delivery of the Bonds, (ii) money transferred to such Interest Account from the Revenue Fund pursuant to the Indenture, (iii) money transferred from the Surplus Fund, the Repair and Replacement Fund, the applicable Debt Service Reserve Account of the Debt Service Reserve Fund and the Operating Fund pursuant to the Indenture in respect of interest payable on the Bonds and (iv) any other amounts deposited with the Trustee with

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directions from the Borrower Representative to deposit the same in the applicable Interest Account of the Bond Fund (or the applicable Subaccount within the Interest Account as so directed).

There will be deposited in the applicable Special Redemption Account of the Bond Fund (i) any Net Proceeds of Insurance Proceeds or Condemnation Award to be transferred to a Special Redemption Account pursuant to the Indenture and (ii) all other payments made by or on behalf of the Authority with respect to the redemption of Bonds pursuant to the Indenture. Amounts on deposit in each Special Redemption Account will be used to pay the redemption price of Bonds of the related Series being redeemed.

Except as otherwise provided in the Indenture, money in the Principal Accounts will be used for the payment of principal of the Bonds of the applicable Series as the same will become due and payable on any Principal Payment Date, including a Principal Payment Date resulting from the redemption of the Bonds pursuant to the Indenture.

Except as otherwise provided in the Indenture, money in the Interest Accounts will be used for the payment of interest on the Bonds as the same becomes due and payable on any Bond Payment Date.

If on any Interest Payment Date, the amount on deposit in the Interest Account or a Principal Account of the Bond Fund is insufficient to make the payments or deposits above, the Trustee will make up any such shortfall by transferring amounts from the following Funds in the following order:

(xxi) the Surplus Fund;

(xxii) the Repair and Replacement Fund;

(xxiii) the respective Debt Service Reserve Account; provided, however, that amounts may be transferred from the Debt Service Reserve Account for the Senior Bonds only in connection with shortfalls on the Senior Bonds and amounts may be transferred from the Debt Service Reserve Account for the Subordinate Bonds only in connection with shortfalls on the Subordinate Bonds; and

(xxiv) the Operating Fund.

Any balance in the Principal Accounts and the Interest Accounts of the Bond Fund on each Interest Payment Date after making the transfers described above will be transferred to the Revenue Fund.

Debt Service Reserve Fund. There will be deposited in the Debt Service Reserve Fund (i) all money transferred to such Debt Service Reserve Fund pursuant to the Indenture, (ii) money transferred from the Revenue Fund pursuant to the Indenture and (iii) any other money received by the Trustee with directions from such party to deposit the same in the Debt Service Reserve Fund.

Amounts on deposit in the Debt Service Reserve Fund will be used to make the payments required pursuant to (1) the Tax-Exempt Bond Fund Interest Subaccount and the Taxable Bond Fund Interest Subaccount or (2) the Tax-Exempt Bond Fund Principal Subaccount and the Taxable Bond Fund Principal Subaccount after the transfer of any amounts from the Surplus Fund and the Repair and Replacement Fund pursuant to the Indenture, if the amounts on deposit in the Revenue Fund are insufficient therefor.

Amounts on deposit in the applicable Debt Service Reserve Accounts or Subaccounts will be transferred to the applicable Principal Accounts or Subaccounts of the Bond Fund at the written direction of a Borrower’s Representative for the purpose of paying the last maturing principal of the Senior Bonds or Subordinate Bonds, as applicable, on a Principal Payment Date or, if all of a series of the Bonds are being redeemed, to the applicable Special Redemption Accounts of the Bond Fund for redemption of Bonds; provided, however, that amounts may be transferred from the Debt Service Reserve Account for the Senior Bonds only in connection with shortfalls on the Senior Bonds and amounts may be transferred from the Debt Service Reserve Account for the Subordinate Bonds only in connection with shortfalls on the Subordinate Bonds; provided further, that amounts in the Tax-Exempt Debt Service Reserve Subaccount may not be used to pay principal nor interest on the Series 2017B Bonds, and amounts

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in the Taxable Debt Service Reserve Subaccount may not be used to pay principal nor interest on the Series 2017A Bonds.

If the Debt Service Reserve Requirement for the Senior Bonds or the Subordinate Bonds is reduced or eliminated in accordance with the definition thereof, the amounts on deposit in the applicable Debt Service Reserve Account or Subaccount in excess of the applicable Debt Service Reserve Requirement will, at the written direction of a Borrower’s Representative delivered to the Trustee, be either (i) transferred to the applicable Special Redemption Account or Subaccount to be used to redeem Bonds pursuant to the Indenture, (ii) transferred to the related Principal or Interest Account or Subaccount to pay the principal of and/or interest on the Bonds as it becomes due, or (iii) if no Bonds remain outstanding, either transferred to the Revenue Fund and applied as provided in the Indenture, or used for any other purpose directed in writing by a Borrower’s Representative, which, in the opinion of a Favorable Opinion of Bond Counsel delivered to the Authority and the Trustee, complies with the Act and will not adversely affect the exclusion from gross income of the recipients thereof of the interest on the Tax-Exempt Bonds for federal income tax purposes.

All interest income derived from the investment of amounts on deposit in the applicable Debt Service Reserve Accounts and Subaccounts will be retained in the applicable Debt Service Reserve Accounts and Subaccounts until the amount on deposit therein will be equal to the Debt Service Reserve Fund Requirement for the Senior Bonds or the Subordinate Bonds, respectively, and thereafter will be deposited into the Revenue Fund.

Rebate Fund. Amounts will be deposited in the Rebate Fund and will be applied as provided in the Tax Agreement.

Operating Fund. The Trustee will deposit in the Operating Fund (i) money transferred from the Revenue Fund in the amounts and on the dates described in the Indenture, (ii) any transfers from the Operating Account received by the Trustee for deposit in the Operating Fund, and (iii) any other amounts required to be deposited into the Operating Fund under the Indenture, the Loan Agreement or the Mortgage and delivered to the Trustee with written instructions to deposit the same therein. Except when an Event of Default under the Indenture or a Default under the Loan Agreement has occurred and is continuing, the Trustee will transfer amounts deposited in the Operating Fund to the Operating Account promptly following such deposits in accordance. If an Event of Default under the Indenture has occurred and is continuing, the Trustee may in its sole discretion and will, if so directed by the Controlling Holders in accordance with the Indenture, not make such transfers to the Operating Account, in which case (i) the Borrower will not be entitled to request withdrawals from funds on deposit in the Operating Fund, and (ii) the Trustee may determine to pay Operating Expenses of the Project directly, without receipt of direction from a Borrower’s Representative and in such event is to rely on the annual Budget prepared by the Borrower in connection with the Project.

Insurance and Tax Escrow Fund. The Trustee will deposit in the Insurance and Tax Escrow Fund (i) money transferred from the Revenue Fund in the amounts and on the dates described under the heading “SECURITY AND SOURCES OF PAYMENT OF THE BONDS – Revenue Fund” herein and (ii) any other amounts required to be deposited into the Insurance and Tax Escrow Fund under the Indenture, the Loan Agreement or the Mortgage and delivered to the Trustee with instructions to deposit the same therein. Amounts in the Insurance and Tax Escrow Fund will be disbursed by the Trustee as provided in the Indenture, upon delivery by a Borrower’s Representative to the Trustee of a requisition, substantially in the form attached as Exhibit B-2 to the Loan Agreement. Money on deposit in the Insurance and Tax Escrow Fund will be disbursed by the Trustee to the Borrower to pay, or as reimbursement for the payment of, taxes, assessments, and insurance premiums with respect to the Project, as provided in the Indenture. Excess amounts may be disbursed to the Revenue Fund upon written direction of the Borrower if actual costs are below budgeted amounts.

Upon presentation to the Trustee by the Borrower Representative of a requisition accompanied by copies of bills or statements for the payment of such taxes, assessments, and premiums, when due, the Trustee will, not more frequently than once a month, pay to the Borrower to provide for the payment of, or as reimbursement for the payment of, such taxes, assessments and premium with respect to the applicable Project, from money then on deposit in the respective accounts in the Insurance and Tax Escrow Fund. If the total amount on deposit in the Insurance and Tax Escrow Fund will not be sufficient to pay to or to pay or reimburse the Borrower in full for the

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payment of such taxes, assessments and premiums, then the Borrower will pay the excess amount of such taxes, assessments and premiums directly.

Repair and Replacement Fund. The Trustee will deposit into the Repair and Replacement Fund (i) money transferred from the Revenue Fund in the amounts and on the dates described in the Indenture and (ii) any other amounts required to be deposited into the Repair and Replacement Fund under the Indenture, the Loan Agreement or the Mortgage and delivered to the Trustee with instructions to deposit the same therein. The Trustee will apply money on deposit in the Repair and Replacement Fund upon request of a Borrower’s Representative as evidenced by a requisition substantially in the form attached as Exhibit B-2 to the Loan Agreement, but no more frequently than once a month, to pay to or to reimburse the Borrower for paying the cost of replacements or items of extraordinary maintenance or repair which may be required to keep the Project in sound condition, including but not limited to, replacement of appliances, major floor covering replacement, replacement or repair of any roof or other structural component of the Project, maintenance (including painting) to exterior surfaces and major repairs to or replacements of heating, air conditioning, plumbing and electrical systems, landscaping, storm water drainage, repairs to common area amenities and any other extraordinary costs required for the repair or replacement of the Project not properly payable from the Revenue Fund but in any case only if there are no funds available in the Project Fund for such purpose.

Upon presentation to the Trustee by a Borrower’s Representative of a requisition accompanied by a summary of the amount for which payment or reimbursement is sought and, for requests for a particular line item of disbursement in excess of $25,000, copies of bills or statements for the payment of the costs of such repair and replacement (provided that the Trustee will have no duty or obligation to review or approve such bills or statements), the Trustee will pay to the Borrower the amount of such repair and replacement costs from money then on deposit in the Repair and Replacement Fund, provided no Event of Default will then exist under the Indenture. If the total amount on deposit in the Repair and Replacement Fund will not be sufficient to pay all of such repair and replacement costs when they become due then the Borrower will pay the excess amount of such costs directly (which Borrower’s monies may be reimbursed from monies available in the Repair and Replacement Fund at a later date when they become available) or from monies available for such purpose in the Surplus Fund.

The Repair and Replacement Fund will also be used to remedy any deficiency in the Bond Fund on any Interest Payment Date after exhaustion of the Surplus Fund, without any prior consents, and may also be used to pay Operating Expenses as needed.

Administration Fund. The Trustee will deposit in the Administration Fund (i) money transferred from the Revenue Fund pursuant to the Indenture, and (ii) any other amounts required to be deposited in the Administration Fund under the Indenture or under the Loan Agreement or the Mortgage with instructions to deposit the same therein. The Trustee will disburse amounts in the Administration Fund necessary for payment of Administration Expenses then due automatically to the parties due such payment upon presentation of an invoice from such requesting party without any approval from the Borrower. The Trustee will disburse amounts in the Administration Fund necessary for payment of Extraordinary Trustee’s Fees and Expenses upon presentation of an invoice for payment from the Trustee approved by the Borrower, which approval will not be unreasonably withheld and which will not be required in the event an Event of Default under the Indenture has occurred and is then continuing.

Surplus Fund. The Trustee will deposit into the Surplus Fund, amounts transferred from the Revenue Fund pursuant to the Indenture and any other amounts delivered to it with instructions to deposit the same in the Surplus Fund. Money in the Surplus Fund will be applied each month, when needed, for the following purposes in the order stated and in the following manner:

(i) transferred to the Interest Account for the Senior Bonds to pay interest on the Senior Bonds to the extent amounts on deposit in such Interest Account are insufficient therefor;

(ii) transferred to a Principal Account for the Senior Bonds to pay principal on the Senior Bonds to the extent amounts on deposit in such Principal Account are insufficient therefor;

(iii) transferred to the Interest Account for the Subordinate Bonds to pay interest on the Subordinate Bonds to the extent amounts on deposit in such Interest Account are insufficient therefor;

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(iv) transferred to the Principal Account for the Subordinate Bonds to pay principal on the Subordinate Bonds to the extent amounts on deposit in such Principal Account are insufficient therefor;

(v) transferred to the Revenue Fund to the extent of any deficiency in the amounts needed to fully make all transfers from the Revenue Fund pursuant to the Indenture (other than to the Surplus Fund);

(vi) transferred to or upon the direction of a Borrower’s Representative for deposit into the Operating Account for the payment of Operating Expenses when the Borrower Representative certifies to the Trustee that there are not sufficient money in the Operating Fund or a Property Operating Account to pay Operating Expenses;

(vii) paid to the Trustee an amount equal to Extraordinary Trustee’s Fees and Expenses then due; and

(viii) pay any unpaid and due Administrative Expenses.

If on or after the Annual Evaluation Date, the Trustee receives a certificate signed by the Borrower’s Representative stating that the Borrower has satisfied the Coverage Test (as shown in a report by a Certified Public Accountant delivered by the Borrower to the Trustee pursuant to the Loan Agreement) for the Fiscal Year ending on such Annual Evaluation Date, upon which the Trustee may conclusively rely, no Event of Default, or event which with the passage of time or the giving of notice or both would constitute an Event of Default, has occurred and is continuing, the Debt Service Reserve Requirement and the required Repair and Replacement Fund deposits have been fully funded, and the Borrower is in compliance with the Liquidity Requirement, then within two Business Days after written request by the Borrower’s Representative to the Trustee, the Trustee will disburse from the Surplus Fund to the Borrower an amount equal to the lesser of (i) Surplus Cash as of such Annual Evaluation Date or (ii) Surplus Cash available on the date of disbursement.

Notwithstanding anything to the contrary herein, the Trustee will not make disbursements to the Borrower pursuant to the Indenture unless the Trustee has received the financial reports and certificates then due as set forth in the Loan Agreement.

Bonds Not Presented for Payment. In the event any Bonds are not presented for payment when the principal thereof becomes due on any Bond Payment Date, if money sufficient to pay such Bonds are held by the Trustee, the Trustee will segregate and hold such money in trust, without liability for interest thereon, for the benefit of Holders of such Bonds who will, except as provided in the following paragraph, thereafter be restricted exclusively to such funds for the satisfaction of any claim of whatever nature on their part under the Indenture or relating to said Bonds. All money deposited with the Trustee for the payment of principal of, premium, if any, or interest on the Bonds and not claimed for the earlier of (a) two years after they become payable or distributable or (b) one day less than the applicable escheat laws will be paid by the Trustee to the Authority. In such event, the Trustee and the Borrower will be relieved of all liability with respect to such money and payment for such Bonds and the Holder of such Bonds will look solely to the Authority for such payment.

Money Held In Trust. All money required to be deposited with or paid to the Trustee for deposit into any Fund or Account (other than the Rebate Fund) and all moneys withdrawn from a Bond Fund and held by the Trustee will be held by the Trustee, in trust, and such moneys (other than moneys held in the Rebate Fund) will, while so held, constitute part of the Trust Estate and be subject to the lien of the Indenture. Money held in an Account in the Bond Fund will constitute a separate trust fund for the Holders of the related Series of Bonds and will not constitute property of the Authority or the Borrower.

Payment to the Borrower. After the right, title and interest of the Trustee in and to the Trust Estate and all covenants, agreements and other obligations of the Authority to the Holders will have ceased, terminated and become void and will have been satisfied and discharged in accordance with the Indenture, and after payment in full of all Administration Expenses and all fees, expenses and other amounts payable to the Trustee and the Authority pursuant to any provision hereof will have been paid in full, any money remaining in the Funds and Accounts under the Indenture will be paid or transferred to the Borrower upon the written request of the Borrower Representative;

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provided that amounts on deposit in the Rebate Fund will be retained therein to the extent required by the Tax Agreement.

Deposit of Extraordinary Revenues. Any money representing Net Proceeds of Insurance Proceeds or Condemnation Awards upon damage to, destruction of or governmental taking of the Project and deposited with the Trustee pursuant to the Loan Agreement will be deposited by the Trustee in the Project Fund.

At the direction of the Borrower Representative, the Trustee will disburse such money in the Project Fund as provided in the Loan Agreement to enable the Borrower to undertake a restoration of a Project if such restoration is permitted by law; provided that, if the Borrower exercises or is deemed to have exercised its option to apply such money to the payment of the Note or the conditions of the Loan Agreement are not satisfied, or an excess of such money exists after restoration of a Project, such money will be transferred by the Trustee to the applicable Special Redemption Account of the Bond Fund and applied to redeem or prepay the Bonds pursuant to the Indenture, in a principal amount equal to the amount so transferred or the next lowest Authorized Denomination of the Bonds.

Title insurance proceeds will be used to remedy any title defect resulting in the payment thereof or deposited in the Bond Fund for use in redeeming Bonds pursuant to the Indenture.

The proceeds of any rental loss, use and occupancy or business interruption insurance will be deposited in the Revenue Fund.

Subordination of Subordinate Bonds. For all purposes of Article V of the Indenture and other articles, deposits made to the Accounts in the Bond Fund for the Subordinate Bonds and payment of Debt Service on the Subordinate Bonds will be subordinate to the deposits to be made to the Accounts in the Bond Fund for the Senior Bonds under the Indenture and to the payment when due of Debt Service on the Senior Bonds. The Accounts in the Bond Fund for any Bonds have been specifically pledged and set aside to secure or provide for the payment of principal of and interest on such Series of Bonds.

Investments

Money in all Funds and Accounts established under the Indenture will, at the written direction of the Borrower Representative at least two Business Days before the making of such investment (any oral direction to be promptly confirmed in writing), be invested and reinvested by the Trustee in Permitted Investments. Subject to the further provisions of the Indenture, such investments will be made by the Trustee as directed and designated by a Borrower’s Representative in a certificate of, or telephonic advice promptly confirmed by a certificate of a Borrower’s Representative. As long as no Event of Default shall have occurred and be continuing, a Borrower’s Representative will have the right to designate the investments to be sold and otherwise to direct the Trustee in the sale or conversion to cash of the investments made with the money in any Fund or Account. The Borrower will not direct that any investment be made of any funds which would violate the covenants set forth in the Indenture. Unless otherwise confirmed in writing, an account statement delivered by the Trustee to a Borrower’s Representative will be deemed written confirmation by the Borrower that the investment transactions identified therein accurately reflect the investment directions given to the Trustee by the Borrower, unless a Borrower’s Representative notifies the Trustee in writing to the contrary within 30 days after the date of such statement. Moneys held as part of any fund or account for which no written direction for investment has been given to the Trustee will remain uninvested.

Money in any Fund or Account will be invested in Permitted Investments with respect to which payments of principal thereof and interest thereon are scheduled to be paid or are otherwise payable (including Permitted Investments payable at the option of the holder) not later than the earlier of (a) the date on which it is estimated that such money will be required by the Trustee, or (b) six months after the date of acquisition thereof by the Trustee.

The Trustee may make any and all such investments through its own banking, trust or investment department or through any affiliate. All income attributable to money deposited in any Fund or Account created under the Indenture will be credited to the Revenue Fund, except that income on money (a) in the Project Fund will be credited to the Project Fund, (b) in the Rebate Fund will be credited to the Rebate Fund, and (c) in the Debt Service Reserve Fund will be credited to the Debt Service Reserve Fund to the extent provided in the Indenture. Any

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net loss realized and resulting from any such investment will be charged to the particular fund or account for whose account such investment was made. The Trustee is authorized and directed to sell and reduce to cash funds a sufficient amount of such investments whenever the cash balance in any fund or account is insufficient to make any withdrawal therefrom as required under the Indenture. The Trustee will not be liable for any depreciation of the value of any investment made pursuant to the Indenture or for any loss resulting from any such investment on the redemption, sale and maturity thereof.

Permitted Investments held in the Debt Service Reserve Fund will be valued at cost on each Interest Payment Date.

The Trustee will at all times maintain accurate records of deposits into each Fund and Account and the sources of such deposits and such records will be made available to the Borrower upon reasonable written request.

Defeasance

If the Authority pays or causes to be paid to the Holder of any Bond the principal of, premium, if any, and interest due and payable, and thereafter to become due and payable, upon such Bond, or any portion of such Bond in any Authorized Denomination thereof, such Bond or portion thereof will cease to be entitled to any lien, benefit or security under the Indenture. If the Authority pays or causes to be paid the principal of, premium, if any, and interest due and payable on all Outstanding Bonds, and thereafter to become due and payable thereon, and will pay or cause to be paid all other sums payable under the Indenture by the Authority, including all fees, compensation and expenses of the Trustee and receipt by the Trustee of an opinion of Counsel that all conditions precedent have been complied with, then the right, title and interest of the Trustee in and to the Trust Estate will thereupon cease, terminate and become void and the Trustee will release or cause to be released the Trust Estate, the Mortgage and any other documents securing the Bonds or execute such documents so as to permit the Trust Estate, the Mortgage and such other documents to be released.

Any Bond will be deemed to be paid within the meaning of the Indenture and for all purposes of the Indenture when (a) payment of the principal of and premium, if any, on such Bond, plus interest thereon to the due date thereof (whether such due date is by reason of maturity or upon redemption as provided in the Indenture) either (i) will have been made or caused to be made in accordance with the terms thereof or (ii) will have been provided for by any irrevocable deposit with the Trustee in trust and irrevocably set aside exclusively for such payment, (A) funds sufficient to make such payment and/or (B) Government Obligations maturing as to principal and interest in such amounts and at such times as will insure the availability of sufficient moneys to make such payment, and (b) all fees, compensation and expenses of the Trustee pertaining to the Bond with respect to which such deposit is made accrued and to accrue until final payment of the Bonds, whether at maturity or upon redemption, will have been paid or the payment thereof provided for to the satisfaction of the Trustee. At such times as a Bond will be deemed to be paid under the Indenture, as aforesaid, such Bond will no longer be secured by or entitled to the benefits of the Indenture, except for the purposes of any such payment from such funds or Government Obligations.

Notwithstanding the foregoing paragraph, no deposit under clause (a)(ii) of the immediately preceding paragraph will be deemed a payment of such Bond as aforesaid until the Authority or a Borrower’s Representative, on behalf of the Authority, will have given the Trustee, in form satisfactory to the Trustee, irrevocable written instructions to notify, as soon as practicable, the Holders in accordance with the Indenture, that the deposit required by (a)(ii) above has been made with the Trustee and that said Bond is deemed to have been paid in accordance with the Indenture and stating the maturity or redemption date upon which money is to be available for the payment of the redemption price of said Bond, plus interest thereon to the due date thereof; or (b) the maturity of such Bond. In addition to the foregoing, no deposit described in clause (a)(ii) of the immediately preceding paragraph will be deemed a payment of said Bond until the Borrower has delivered to the Trustee (i) a report of an Independent Certified Public Accountant verifying the sufficiency of the amounts, if any, described in (a)(ii) above to insure payment of such Bond, and (ii) a Favorable Opinion of Bond Counsel addressed to the Authority and the Trustee to the effect that such deposit will not adversely affect the exclusion of interest on the Tax-Exempt Bonds from the gross income of the recipients thereof for federal income tax purposes.

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Defaults and Remedies

Events of Default. Each of the following events will constitute a “Default” or an “Event of Default” under the Indenture with respect to the Bonds:

(a) While any Senior Bonds are Outstanding:

(1) a failure to pay the principal of or premium, if any, on any of the Senior Bonds when the same becomes due and payable at maturity or upon redemption;

(2) a failure to pay an installment of interest on any of the Senior Bonds when the same becomes due and payable;

(b) If no Senior Bonds are Outstanding:

(1) a failure to pay the principal of or premium, if any, on any of the Subordinate Bonds when the same becomes due and payable at maturity or upon redemption;

(2) a failure to pay an installment of interest on any of the Subordinate Bonds when the same becomes due and payable;

(c) a failure by the Authority to observe and perform any other covenant, condition, agreement or provision (other than as specified in subparagraphs (a) and (b) above) contained in the Bonds or in the Indenture on the part of the Authority to be observed or performed with respect to the Bonds, which failure will continue for a period of 30 days after written notice is provided by the Trustee, specifying such failure and requesting that it be remedied, will have been given to the Authority by the Trustee, which may give such notice in its discretion and will give such notice at the written request of the Controlling Holders, unless the Trustee, or the Trustee and Holders which requested such notice, as the case may be, will agree in writing to an extension of such period prior to its expiration; provided, however, that the Trustee, or the Trustee and the Holders of such Bonds, as the case may be, will be deemed to have agreed to an extension of such period if corrective action is initiated by the Authority within such period and is being diligently pursued; provided, further that in no event will such period be extended for more than 180 days after the date of giving of notice of such failure without the consent of the Controlling Holders; and

(d) the occurrence of a “Default” under the Loan Agreement or an “Event of Default” under the Mortgage.

Acceleration; Other Remedies. Upon the occurrence and continuance of an Event of Default, the Trustee, subject to the provisions of the Indenture, may, and at the written request of the Controlling Holders (or in the case of an Event of Default under the Indenture, unanimous written request of the Holders of the Bond Obligation for the Senior Bonds if any Senior Bonds remain Outstanding, or unanimous written request of the Holders of the Bond Obligation for the Subordinate Bonds if no Senior Bonds remain Outstanding), will by written notice to the Authority and the Borrower, declare the Bonds to be immediately due and payable, whereupon such Bonds will, without further action, become and be immediately due and payable, anything in the Indenture or in the Bonds to the contrary notwithstanding, and the Trustee will give notice thereof to the Authority and the Rating Agency, and will give notice thereof by Mail to Holders of the Bonds.

Notwithstanding any other provision of the Indenture to the contrary, (i) if an Event of Default with respect to the payment of the principal of or interest on the Subordinate Bonds occurs (but an Event of Default does not exist with regard to the Senior Bonds) while any Senior Bonds remain Outstanding, then the Trustee will not accelerate the Bonds and will not exercise any of the other remedies available pursuant to the Indenture or applicable law without the consent of the Holders of all of the Senior Bonds.

The provisions of the preceding paragraph are subject to the condition that if, after the principal of the Bonds shall have been so declared to be due and payable, and before any judgment or decree for the payment of the money due shall have been obtained or entered as provided in the Indenture, (i) the Authority will, from any

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payment received from the Borrower for such purpose, deposit with the Trustee a sum sufficient to pay all matured installments of interest on all Bonds and the principal of any and all Bonds which shall have become due otherwise than by reason of such declaration (with interest on such principal and, to the extent permissible by law, on overdue installments of interest at the Default Rate) and such amount as shall be sufficient to pay Extraordinary Trustee’s Fees and Expenses, and (ii) all Events of Default under the Indenture with respect to the Bonds other than nonpayment of the principal of such Bonds which shall have become due by said declaration shall have been remedied, then, in every such case, upon the written consent of the Controlling Holders provided to the Trustee, such Event of Default will be deemed waived and such declaration and its consequences rescinded and annulled, and the Trustee will promptly give written notice of such waiver, rescission or annulment to the Authority and the Rating Agency, and will give notice thereof by Mail to all Holders of Bonds; but no such waiver, rescission and annulment will extend to or affect any subsequent Event of Default or impair any right or remedy consequent thereon.

Upon the occurrence and continuance of any Event of Default, then and in every such case the Trustee in its discretion may, and upon the written direction of the Controlling Holders and receipt of indemnity to its satisfaction will, in its own name and as the Trustee of an express trust perform any or all of the following:

(a) by mandamus, or other suit, action or proceeding at law or in equity, enforce all rights of the Holders under the Indenture or the applicable Bonds, including without limitation requiring the Authority or the Borrower to carry out any agreements with or for the benefit of the Holders and to perform its or their duties under the Act, the Loan Agreement, the Mortgage, the Land Use Restriction Agreement, the Tax Agreement and the Indenture, provided that any such remedy may be taken only to the extent permitted under the applicable provisions of the Loan Agreement, the Mortgage, the Land Use Restriction Agreement, the Tax Agreement or the Indenture, as the case may be;

(b) bring suit upon the Bonds;

(c) by action or suit in equity enjoin any acts or things which may be unlawful or in violation of the rights of the Holders of Bonds;

(d) foreclose the Mortgage;

(e) file proofs of claim in any bankruptcy or insolvency proceedings related to the Authority, the Borrower or the Project, necessary or appropriate to protect the interests of the Trustee or the Holders of the Bonds; or

(f) exercise any rights and remedies with respect to the Trust Estate as may be available to a secured party under the Uniform Commercial Code in effect in the applicable state.

Notwithstanding anything in the Indenture to the contrary, neither the Holders of the Bonds nor the Trustee acting on behalf of the Holders of the Bonds will have any right, and hereby waive any right, to institute a proceeding under the Bankruptcy Code seeking to adjudge the Authority or the Borrower insolvent or a bankrupt or seeking a reorganization of the Authority or the Borrower.

Upon instituting any such proceeding, the Trustee will be entitled, as a matter of right, to the appointment of a receiver of the Project and other assets pledged under the Indenture or the Mortgage, pending resolution of such proceeding. The Trustee will have the right to decline to follow any direction of any Bondholder that in the sole discretion of the Trustee would be unjustly prejudicial to the Trustee, that would expose the Trustee to unreasonable liability or financial exposure or that is not in accordance with law or the provisions of the Indenture. The Trustee will be entitled to rely without further investigation or inquiry upon any written direction given by the Holders of the majority of the Bonds Outstanding, and will not be responsible for the propriety of or be liable for the consequences of following any such direction. Notwithstanding anything to the contrary contained in the Indenture, the Trustee will not be required to foreclose the Mortgage or bid on behalf of the Holders at any foreclosure sale (a) if, in the Trustee’s sole discretion, such action would subject the Trustee to personal liability for the cost of investigation, removal and/or remedial activity with respect to Hazardous Substances, (b) if the presence of any Hazardous Substances on the property subject to the Mortgage results in such property having no or nominal value or (c) if as a

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result of any such action, the Trustee would be considered to hold title to or to be a “mortgagee-in-possession,” “owner” or “operator” of the Project within the meaning of the Comprehensive Environmental Responsibility Cleanup and Liability Act of 1980, as amended, unless the Trustee has previously determined, based on a report prepared by an environmental audit consultant acceptable to the Trustee, that (i) the Project is in compliance with applicable environment laws and (ii) there are not circumstances present at the Project relating to the use, management or disposal of any Hazardous Substances for which investigation, testing, monitoring, containment, clean-up or remediation could be required under any federal, state or local law or regulation. It is acknowledged and agreed that the Trustee has no authority to manage, own or operate the Project, or any portion thereof, except as necessary to exercise remedies upon an Event of Default.

Restoration to Former Position. In the event that any proceeding taken by the Trustee to enforce any rights under the Indenture have been discontinued or abandoned for any reason, or have been determined adversely to the Trustee, then the Authority, the Trustee and the Holders will be restored to their former positions and rights under the Indenture, respectively, and all rights, remedies and powers of the Trustee will continue as though no such proceeding had been taken.

Cure by Holders. Any Holder of Bonds may, but will not be obligated to, cure an Event of Default under the Indenture, including the advancing of funds (“Advanced Funds”) to the Trustee for payments required under the Indenture, or to indemnify the Trustee under the Indenture. Any Advanced Funds are to be applied by the Trustee in accordance with the instructions of the Holder providing the same; provided, however, that such Holder will not have a right or interest in the Advanced Funds that is superior to any right or interest any other party has under the Indenture.

Controlling Holders’ Right to Direct Proceedings. Anything in the Indenture to the contrary notwithstanding, the Controlling Holders will have the right, by an instrument in writing executed and delivered to the Trustee, to direct the time, method and place of conducting all remedial proceedings available to the Trustee under the Indenture or exercising any trust or power conferred on the Trustee by the Indenture.

Limitation on Holders’ Right to Direct Proceedings. Subject to the provisions under the heading “Acceleration; Other Remedies” and unless otherwise provided for in the Indenture, no Holder will have any right to institute any suit, action or proceeding in equity or at law for the execution of any trust or power under the Indenture, or any other remedy under the Indenture or on said Bonds, unless such Holder previously will have given to the Trustee written notice of an Event of Default and unless also the Holders of not less than a majority of the Bonds Outstanding will have made written request of the Trustee to do so after the right to institute said suit, action or proceeding under the heading “Acceleration; Other Remedies” will have accrued, and will have afforded the Trustee a reasonable opportunity to proceed to institute the same in either its or their name, and the Trustee will not have complied with such request within a reasonable time. No one or more of the Holders of the Bonds will have any right in any manner whatever by its or their action to affect, disturb or prejudice the security of the Indenture, or to enforce any right under the Indenture or under the Bonds, except in the manner provided in the Indenture, and all suits, actions and proceedings at law or in equity will be instituted, had and maintained in the manner provided in the Indenture and for the equal benefit of all Holders of Bonds. Notwithstanding anything to the contrary, the furnishing of indemnity to the Trustee as provided in the Indenture is declared in every such case, at the option of the Trustee, to be a condition precedent to the institution of said suit, action or proceeding by the Trustee.

No Impairment of Right To Enforce Payment. Notwithstanding any other provision in the Indenture, the right of any Holder of a Bond to receive payment of the principal of and interest on such Bond, on or after the respective due dates expressed therein, or to institute suit for the enforcement of any such payment on or after such respective date, will not be impaired or affected without the consent of such Holder.

Proceedings by Trustee Without Possession of Bonds. All rights of action under the Indenture or under any of the Bonds secured hereby which are enforceable by the Trustee may be enforced by it without the possession of any of the Bonds, or the production thereof at the trial or other proceedings relative thereto, and any such suit, action or proceeding instituted by the Trustee will be brought in its name for the equal and ratable benefit of the Holders of Bonds, subject to the provisions of the Indenture.

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No Remedy Exclusive. No remedy conferred upon or reserved to the Trustee or to Holders is intended to be exclusive of any other remedy or remedies, and each and every such remedy will be cumulative, and will be in addition to every other remedy given under the Indenture, or now or hereafter existing at law or in equity or by statute; provided, however, that any conditions set forth to the taking of any remedy to enforce the provisions of the Indenture or the Bonds will also be conditions to seeking any remedies under any of the foregoing remedies provided in this summary.

No Waiver of Remedies. No delay or omission of the Trustee or of any Holder to exercise any right or power accruing upon any default will impair any such right or power or will be construed to be a waiver of any such default, or an acquiescence therein; and every power and remedy given by the Indenture to the Trustee and to the Holders, respectively, may be exercised from time to time and as often as may be deemed expedient.

Application of Money. If an Event of Default occurs with respect to the Bonds, any money held in any Fund or Account under the Indenture (excluding the Rebate Fund) or received by any receiver or by the Trustee, by any receiver or by any Holder pursuant to any right given or action taken under the provisions of the Indenture, after payment of (i) the fees, expenses, liabilities or advances payable to or incurred or made by the Trustee, the Authority or any Holder, (ii) the costs and expenses of the proceedings resulting in the collection of such money, and (iii) Operating Expenses of the Project as determined to be appropriate by the Trustee (and the Trustee may, in its discretion, rely on the Budget to make such determination), will be deposited in the Revenue Fund; and all money so deposited in the Revenue Fund during the continuance of an Event of Default (other than money for the payment of Bonds which have matured or otherwise become payable prior to such Event of Default or for the payment of interest due prior to such Event of Default) will be applied (except as otherwise provided in the Indenture with respect to money deposited in a Bond Fund Account for the benefit of the Holders of the Bonds) as follows:

(a) Unless the principal of all the Bonds shall have been declared due and payable, all such money will be applied (A) first, together with any amounts on deposit in the Debt Service Reserve Account relating to the Senior Bonds, to the payment to the persons entitled thereto of all installments of interest then due on the Senior Bonds and any Senior Parity Indebtedness, with interest on overdue installments, if lawful, at the Default Rate, in the order of maturity of the installments of such interest and, if the amount available will not be sufficient to pay in full any particular installment of interest, then to the payment ratably, according to the amounts due on such installment of interest on the Senior Bonds and any Senior Parity Indebtedness on a parity and pro rata basis, (B) second, together with any amounts on deposit in the Debt Service Reserve Accounts relating to the Senior Bonds, to the payment to the persons entitled thereto of the unpaid principal of any of the Senior Bonds and any Senior Parity Indebtedness which shall have become due (other than Senior Bonds called for redemption for the payment of which money is held pursuant to the provisions of the Indenture) with interest on such Senior Bonds and any Senior Parity Indebtedness at the Default Rate from the respective dates upon which they became due and, if the amount available will not be sufficient to pay in full Senior Bonds and any Senior Parity Indebtedness due on any particular date, together with such interest, then to the payment ratably, according to the amount of principal and interest due on such date, in each case to the persons entitled thereto, without any discrimination or privilege, (C) third, together with any amounts on deposit in the Debt Service Reserve Account relating to the Subordinate Bonds and any Subordinate Parity Indebtedness, to the payment to the persons entitled thereto of all installments of interest then due on the Subordinate Bonds with interest on overdue installments, if lawful, at the Default Rate, in the order of maturity of the installments of such interest and, if the amount available will not be sufficient to pay in full any particular installment of interest, then to the payment ratably, according to the amounts due on such installment of interest on the Subordinate Bonds and any Subordinate Parity Indebtedness on a parity and pro rata basis; and (D) fourth, together with any amounts on deposit in the Debt Service Reserve Account relating to the Subordinate Bonds, to the payment to the persons entitled thereto of the unpaid principal of any of the Subordinate Bonds and any Subordinate Parity Indebtedness which shall have become due (other than the Subordinate Bonds called for redemption the payment of which money is held pursuant to the provisions of the Indenture) with interest on such Subordinate Bonds and any Subordinate Parity Indebtedness at the Default Rate from the respective dates upon which they became due and, if the amount available will not be sufficient to pay in full the Subordinate Bonds and any Subordinate Parity Indebtedness due on any particular date, together with such interest, then to the payment ratably, according to the amount of principal and interest due on such date, in each case to the persons entitled thereto, without any discrimination or privilege.

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(b) If the principal of all the Bonds shall have been declared due and payable, all such moneys shall be applied: (A) first, to the payment of the principal and interest then due and unpaid upon the Senior Bonds and any Senior Parity Indebtedness, with interest on overdue interest and principal, as aforesaid at the Default Rate, if lawful, without preference or priority of principal over interest or interest over principal, or of any installment of interest over any other installment of interest, or of any Senior Bond and any Senior Parity Indebtedness over any other Senior Bond or any Senior Parity Indebtedness ratably, according to the amounts due respectively for principal and interest, to the persons entitled thereto without any discrimination or privilege and (B) second, to the payment of the principal and interest then due and unpaid upon the Subordinate Bonds and any Subordinate Parity Indebtedness, with interest on overdue interest and principal, as aforesaid at the Default Rate, if lawful, without preference or priority of principal over interest or interest over principal, or of any installment of interest over any other installment of interest, or of any Subordinate Bond and any Subordinate Parity Indebtedness over any other Subordinate Bond or any Subordinate Parity Indebtedness, ratably, according to the amounts due respectively for principal and interest, to the persons entitled thereto without any discrimination or privilege.

(c) If the principal of all the Bonds will have been declared due and payable, and if such declaration will thereafter have been rescinded and annulled under the provisions of the Indenture, then, subject to the provisions of clause (b) of this section which will be applicable in the event that the principal of all the Bonds will later become due and payable, the moneys will be applied in accordance with the provisions of clause (a) of this section.

Whenever money is to be applied pursuant to the provisions of this section, such money will be applied at such times, and from time to time, as the Trustee will determine, having due regard to the amount of such moneys available for application and the likelihood of additional money becoming available for such application in the future. Whenever the Trustee will apply such funds, it will fix the date (which will be an Interest Payment Date unless it will deem another date more suitable) upon which such application is to be made and upon such date interest on the amounts of principal and interest to be paid on such date will cease to accrue. The Trustee will give notice of the deposit with it of any such money and of the fixing of any such date by Mail to all Holders of Bonds and will not be required to make payment to any Holder of a Bond until such Bond will be presented to the Trustee for appropriate endorsement or for cancellation if fully paid.

Severability of Remedies. It is the purpose and intention of the Indenture to provide rights and remedies to the Trustee and the Holders which may be lawfully granted under the provisions of the Act, but should any right or remedy granted by the Indenture be held to be unlawful, the Trustee and the Holders will be entitled, as above set forth, to every other right and remedy provided in the Indenture and by law.

Notice of Event of Default. If an Event of Default occurs and continues for five Business Days after the Trustee has received written notice of the same as provided in the Indenture, then the Trustee will give notice thereof by Mail to the Holders, the Borrower, the Authority and the Rating Agency.

Costs and Expenses. When the Trustee or the Authority incurs costs or expenses (including legal fees, costs and expenses) or renders services after the occurrence of an Event of Default, such costs and expenses and the compensation for such services are intended to constitute expenses of administration under any federal or state bankruptcy, insolvency, arrangement, moratorium, reorganization or other debtor relief law.

Trustee

Limitations on Liability. The Trustee may execute any of the trusts or powers and perform the duties required of them by or through attorneys, agents, receivers or employees selected by them, and will be entitled to advice of counsel concerning all matters of trust and its duty and to obtain the opinion of Counsel acceptable to the Trustee prior to taking action, and may in all cases pay such reasonable compensation to all such attorneys, agents, receivers or employees as is deemed necessary in connection with the performance of the Trustee’s duties under the Indenture, and the Trustee will not be answerable for the default or misconduct of any such attorney, agent or employee selected by it. The may act upon the advice of any attorney and the Trustee will not be responsible for any loss or damage from any action or non-action in good faith reliance upon such opinion or advice. Without limitation, the Trustee will be entitled to the benefit of the foregoing sentence with respect to the delegation to the Trustee’s duties under the Indenture with respect to payment of principal, premium, if any, or interest on, or redemption of,

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the Bonds, the authentication and delivery thereof, and exchange and transfer thereof. The Trustee will not be answerable for the exercise of any discretion or power under the Indenture or for anything whatsoever in connection with the trust created by the Indenture, except only for its own negligence or willful misconduct.

Notice of Events of Default. The Trustee will not be required to take notice, or be deemed to have notice, of any default or Event of Default under the Indenture, other than an Event of Default relating to a failure to pay the principal of or premium, if any, on any of the Bonds when the same become due and payable at maturity or upon redemption or a failure to pay an installment of interest on any of the Bonds when the same will become due and payable, unless a Responsible Officer of the Trustee will have received actual knowledge or will have been specifically notified in writing of such default or Event of Default by the Authority, the Borrower or by the Holders of at least 25% of the Bond Obligation. The Trustee may, however, at any time, in its discretion, and will, upon the request of at least 25% of the Bond Obligation, require of the Borrower full information and advice as to the performance of any of the covenants, conditions and agreements contained in the Indenture.

Resignation of Trustee. The Trustee may resign and be discharged of the trusts created by the Indenture by executing an instrument in writing resigning such trust and specifying the date when such resignation will take effect, and filing the same with the Authority and the Borrower, and by giving notice of such resignation by Mail, not less than 15 days prior to such resignation date, to all Holders. Such resignation will only take effect on the day a successor Trustee shall have been appointed as provided in the Indenture.

Removal of Trustee. The Trustee may be removed at any time by the Borrower or by the Holders of not less than a majority of the Bond Obligation with the consent of the Borrower (not to be unreasonably withheld), by filing with the Trustee so removed, and with the Authority an instrument or instruments in writing appointing a successor, executed by a Borrower’s Representative if the Trustee has been removed by the Borrower (and notice thereof given by Mail to the Holders and the Authority), or executed by said Holders of Bonds if the Trustee was removed by said Holders; provided that the Borrower may not remove the Trustee, and the consent of the Borrower will not be required (in the case of removal by the Holders), if an Event of Default has occurred and is continuing under the Indenture or a Default has occurred and is continuing under the Loan Agreement.

Appointment of Successor Trustee. If at any time the Trustee gives notice of resignation, is removed, or is dissolved, or if its property or affairs are taken under the control of any state or federal court or administrative body because of insolvency or bankruptcy, or for any other reason become incapable of acting, then a vacancy will forthwith and ipso facto exist in the office of Trustee and the Borrower, with written notice to the Authority, will promptly appoint a successor Trustee. Any such appointment will be made by a written instrument executed by a Borrower’s Representative. Copies of such instrument will be promptly delivered by the Borrower to the predecessor Trustee and to the Trustee so appointed. The successor Trustee will give notice of such appointment by Mail, at least once within 30 days of such appointment, to all Holders.

If, in a proper case, no appointment of a successor Trustee is made pursuant to the preceding paragraph within 60 days after the receipt by the Authority and the Borrower of the Trustee’s notice of resignation has been removed, has been dissolved has otherwise becoming incapable of acting under the Indenture or has been taken under control by a public officer or receive, the retiring Trustee, at the expense of the Borrower, or any Holder may apply to any court of competent jurisdiction to appoint a successor Trustee. The court may thereupon, after such notice, if any, as such court may deem proper and prescribe, appoint a successor Trustee.

Any new Trustee so appointed as presented in this section will immediately and without further act be superseded by a Trustee appointed in the manner above provided.

If at any time the Trustee resigns and no appointment of a successor Trustee is made pursuant to the foregoing provisions of this section prior to the date specified in the notice of resignation as the date when such resignation is to take effect, the resigning Trustee may forthwith apply to a court of competent jurisdiction for the appointment of a successor Trustee. If no appointment of a successor Trustee is made pursuant to the foregoing provisions of the Indenture within six months after a vacancy occurred in the office of Trustee, any Holder may apply to any court of competent jurisdiction to appoint a successor Trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, appoint a successor Trustee.

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Any entity into which any Trustee under the Indenture may be merged or converted or with which it may be consolidated, or any entity resulting from any merger, conversion or consolidation to which any Trustee under the Indenture is a party, or any entity succeeding to the business of the Trustee, or any company to which the Trustee may sell or transfer all or substantially all of its corporate trust business, provided such entity meets the qualifications contained in the Indenture, as appropriate, will be a successor Trustee under the Indenture, without the execution or filing of any paper or any further act on the part of the parties to the Indenture, anything in the Indenture to the contrary notwithstanding.

Qualifications of Trustee. The Trustee and every successor Trustee, if any, (a) will be a bank or trust company duly organized under the laws of the United States or any state thereof authorized by law to perform all the duties imposed upon it by the Indenture, (b) will at the time of appointment have trust assets under management of at least $500,000,000, (c) will be permitted under applicable law to perform the duties of Trustee and (d) will be acceptable to the Authority.

Paying Agent. The Trustee is also acting as the paying agent for the Bonds.

Modification of Bond Documents

Limitations. Neither the Indenture nor any of the Borrower’s Documents will be amended in any respect subsequent to the Closing Date except as provided in and in accordance with and subject to the provisions of the Indenture under the heading “Modification of Bond Documents.” Notwithstanding any provisions thereof, the Tax Agreement and Land Use Restriction Agreement may be Amended pursuant to the provisions thereof, and the Tax Agreement and the Land Use Restriction Agreement will be amended to the extent required by such documents.

Supplemental Indentures Without Holder Consent. The Authority and the Trustee may, from time to time and at any time, without the consent of but with prompt notice to the Holders and the Rating Agency, enter into Supplemental Indentures as follows:

(a) to cure any formal defect, omission, inconsistency or ambiguity in the Indenture;

(b) to add to the covenants and agreements of the Authority in the Indenture other covenants and agreements, or to surrender any right or power reserved or conferred upon the Authority if such surrender will not, in the judgment of the Trustee, materially adversely affect the interests of the Holders, the Trustee being authorized to rely on an opinion of Counsel with respect thereto;

(c) to confirm, as further assurance, any pledge of or lien on the Loan Agreement or of any other moneys, securities or funds subject to the lien of the Indenture;

(d) to comply with the requirements of the Trust Indenture Act of 1939, as from time to time amended;

(e) to preserve the exclusion of interest on the Tax-Exempt Bonds from gross income for federal income tax purposes, as set forth in an opinion of Bond Counsel;

(f) to make changes to obtain, maintain or restore the rating on the Bonds from the Rating Agency;

(g) to provide for any amendment specifically authorized or required by any provision of the Indenture;

(h) in connection with any Additional Bonds or Parity Indebtedness; or

(i) with respect to any other Amendment which does not have a Material Adverse Effect on the Holders of the Bonds.

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Supplemental Indentures Requiring Holders’ Consent. Except for any Supplemental Indenture entered into and not requiring the consent of the Holders, subject to the terms and provisions contained in this section and not otherwise, Holders of not less than a majority of the Bond Obligation affected thereby will have the right from time to time to consent to and approve the execution and delivery by the Authority and the Trustee of any Supplemental Indenture deemed necessary or desirable by the Authority for the purposes of modifying, altering, amending, supplementing or rescinding, in any particular, any of the terms or provisions contained in the Indenture; provided, however, that, unless approved in writing by all Holders of Bonds affected thereby, nothing contained in the Indenture will permit, or be construed as permitting, (i) a change in the times, amounts or currency of payment of the principal of or interest on any Outstanding Bond or a reduction in the principal amount or redemption price of any Outstanding Bond or the rate of interest borne thereon, (ii) the creation of a claim or lien upon, or a pledge of, the Trust Estate ranking prior to or on a parity with the claim, lien or pledge created by the Indenture, (iii) a reduction in the aggregate Bond Obligation the consent of the Holders of which is required for any such Supplemental Indenture or which is required, under the heading “Amendment of Borrower’s Documents Requiring Holder Consent,” for any modification, alteration, amendment or supplement to any Borrower’s Documents and provided further that if the Supplemental Indenture subjects additional property to the lien of the Indenture the Trustee will have been provided with an opinion of Counsel that such Supplemental Indenture is duly authorized in accordance with the terms of the Indenture, or (iv) any change to the Indenture relating to the subordination of the Subordinate Bonds.

Unless approved in writing by a majority of the Holders of the Outstanding Subordinate Bonds, nothing in the Indenture will permit, or be construed as permitting a Supplemental Indenture which further subordinates the priority of the Holders of the Subordinate Bonds to the payment of the Senior Bonds.

Amendment of Borrower’s Documents Without Holder Consent. Without the consent of but with notice to the Holders, the Trustee may consent to any Amendment of the Borrower’s Documents from time to time as follows:

(a) to cure any formal defect, omission, inconsistency or ambiguity in such Borrower’s Document;

(b) to add to the covenants and agreements of the Authority or the Borrower in such document other covenants and agreements, or to surrender any right or power reserved or conferred upon the Authority or the Borrower, if such surrender will not, in the judgment of the Trustee, materially adversely affect the interests of the Holders, the Trustee being authorized to rely on an opinion of Counsel with respect thereto;

(c) to confirm, as further assurance, any lien on or pledge of the Project or the revenues therefrom or of any other property, moneys, securities or funds subject to the Mortgage or any other security for the Loan Agreement;

(d) to preserve the exclusion of interest on the Tax-Exempt Bonds from gross income for federal income tax purposes, as set forth in an opinion of Bond Counsel;

(e) subject to the provisions of the Indenture, to make changes required in order to obtain or maintain the ratings on the Bonds from the Rating Agency;

(f) to provide for any Amendment specifically authorized or required by any provision of any Borrower’s Document;

(g) in connection with any Additional Bonds or Parity Indebtedness; or

(h) with respect to any other Amendment which does not have a Material Adverse Effect on the Holders of the Bonds.

Amendment of Borrower’s Documents Requiring Holder Consent. Except in the case of Amendments referred to under the heading “Amendment of Borrower’s Documents Without Holder Consent,” the Authority and the Trustee will not enter into, and will not consent to, any Amendment of any Borrower Document without the

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written approval or consent of the Holders of the Bonds then Outstanding, given and procured as provided under the heading “Procedures for Amendments;” provided, that the foregoing will not permit or be construed as permitting any change referred to in clause (i) under the heading “Supplemental Indentures Requiring Holders’ Consent” (substituting for such purpose the term “Note” for the word “Bond”) without the consent of all Holders given and obtained in the manner set forth under such heading. If at any time the Authority requests the consent of the Trustee to any such proposed modification, alteration, amendment or supplement, the Trustee will cause notice thereof to be given in the same manner as provided under the heading “Procedures for Amendment” with respect to Supplemental Indentures. Such notice will briefly set forth the nature of such proposed modification, alteration, amendment or supplement and will state that copies of the instrument embodying the same are on file at the Designated Office of the Trustee for inspection by all Holders. The Authority and the Trustee may enter into, or may consent to, any such proposed modification, alteration, amendment or supplement subject to the same conditions and with the same effect as provided under the heading “Supplemental Indentures Requiring Holders’ Consent.”

Procedures for Amendments. If at any time the Trustee will be requested to enter into any Supplemental Indenture requiring the consent of the Holders or to consent to any Amendment to the Borrower’s Documents requiring the consent of the Holders, the Trustee will cause notice of the proposed Supplemental Indenture or other Amendment to be given by Mail to all Holders. Such notice will set forth the nature of the proposed Supplemental Indenture or other Amendment and will state that a copy thereof is on file at the office of the Trustee for inspection by all Holders. Within two months after the date of the first giving of such notice, the Authority and the Trustee may enter into such Supplemental Indenture or the Trustee may consent to such Amendment in substantially the form described in such notice, but only if there will have first been delivered to the Trustee (i) the required consents, in writing, of Holders and (ii) the opinion of Bond Counsel required by the Indenture.

If Holders of not less than the amount of Bond Obligation required for a Supplemental Indenture or Amendment, as applicable, will have consented to and approved the execution and delivery thereof as provided in the Indenture, no Holder will have any right to object to the execution and delivery of such Supplemental Indenture, or other Amendment, or to object to any of the terms and provisions contained therein or the operation thereof, or in any manner to question the propriety of the execution and delivery thereof, or to enjoin or restrain the Authority or the Trustee from executing and delivering or consenting to the same or from taking or permitting any action pursuant to the provisions thereof.

Opinions; Certificate. The Trustee will not enter into or consent to any Amendment of any provision of any Bond Document unless there will have been delivered to the Authority and the Trustee an opinion of Bond Counsel stating that such Amendment is authorized or permitted by the Act and the applicable Bond Documents and such Amendment will not adversely affect the exclusion of interest on the Tax-Exempt Bonds from the gross income of the recipients thereof for federal income tax purposes. In addition, the Trustee (i) may obtain, and will be protected in relying on, an opinion of Counsel to the effect that such Amendment is authorized or permitted by the Indenture and complies with the terms thereof; and (ii) may require, as a condition to entering into or consenting to any such Amendment, a Compliance Certificate from the Borrower.

Effect of Amendments; Other Consents. Upon the execution and delivery of any Supplemental Indenture or any Amendment to a Borrower Document pursuant to the provisions of the Indenture, the Indenture or such Borrower Document will be, and be deemed to be, modified and amended in accordance therewith, and the respective rights, duties and obligations under the Bond Documents of the Authority, the Trustee, the Borrower and all Holders will thereafter be determined, exercised and enforced under the Bond Documents subject in all respects to such modifications and amendments.

Notwithstanding anything in the Indenture to the contrary, (i) the Trustee will not be required to enter into or consent to any Amendment of any Bond Document which, in the sole judgment of the Trustee, might adversely affect the rights, obligations, powers, privileges, indemnities, immunities or other security provided the Trustee under the Indenture or any Bond Document; and (ii) except as otherwise required by the Indenture, the Trustee will not enter into or consent to any Amendment of any Bond Document which affects the rights or obligations of the Borrower or the Authority unless the Borrower or the Authority enters into or consents to such Amendment.

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THE LOAN AGREEMENT

The following is a brief summary of certain provisions of the Loan Agreement. The summary does not purport to be complete or definitive and is qualified in its entirety by reference to the Loan Agreement, a copy of which is on file with the Trustee.

Issuance of Bonds; Loan to Borrower; Related Obligations

Under the Loan Agreement, to provide funds to assist the Borrower in financing the acquisition, rehabilitation and equipping of the Project, the Authority, concurrently with the execution and delivery of the Loan Agreement, and upon satisfaction of the conditions to the delivery of the Bonds set forth the Indenture, will issue, sell and deliver the Bonds and will deposit the proceeds of the Bonds with the Trustee in accordance with the Indenture.

The Borrower will cause all Project Revenues to be deposited with the Trustee upon receipt by the Borrower or the Manager. The Project Revenues will be used to pay the Basic Loan Payments and the Additional Loan Payments, as provided in subparagraph (ii) below.

(i) Basic Loan Payments. The Project Revenues will be used to pay, as Basic Loan Payments, the following amounts:

(1) on or before the 12th day of each month, commencing May 12, 2017, until such time as the principal of and the premium, if any, and interest on, the Bonds shall have been paid in full, or provisions made for such full payment in accordance with the provisions of the Indenture, to the Trustee for deposit in the Interest Account in the Bond Fund provided for in the Indenture, a sum equal to the Interest Requirement on then Outstanding Bonds for such month; and

(2) on or before the 12th day of each month, commencing May 12, 2017, to the Trustee for deposit in the Principal Account in the Bond Fund, a sum equal to the Principal Requirement on then Outstanding Bonds for such month.

The monthly installments of Basic Loan Payments described in (1) and (2) above payable by the Borrower under the Loan Agreement will in any event be equal in the aggregate to an amount that, with other funds in the respective Accounts in the Bond Fund then available for the payment of principal and interest on the Bonds, will be sufficient to provide for the payment in full of the interest on, premium, if any, and principal on the Bonds as they become due and payable.

Except as otherwise provided in the Indenture, the Project Revenues will also be used to pay, as Basic Loan Payments, to the Trustee for deposit in the Bond Fund, such amounts as will, together with any other money available, therefor be sufficient to pay all amounts, if any, required to redeem each Series of Bonds pursuant to the provisions of Article III of the Indenture as and when they become subject to redemption pursuant thereto, together with any related redemption premium associated therewith, with all such payments to be made by the Borrower to the Trustee, for deposit into the Bond Fund Accounts on or before the date such money is required by said provisions of the Indenture.

(ii) Additional Loan Payments. The Borrower will cause the Project Revenues to be remitted to the Trustee from time to time in amounts fully sufficient to timely pay, in addition to the Basic Loan Payments, the following costs and expenses (to the extent such costs and expenses are not paid from the proceeds of the sale of the Bonds), which are the Additional Loan Payments:

(1) the Ordinary Trustee’s Fees and Expenses and Extraordinary Trustee’s Fees and Expenses, and all other fees and other costs of the Trustee, including without limitation, reasonable fees and expenses of counsel to the Trustee, payable to the Trustee for services or indemnity under the Indenture and the Borrower’s Documents (including

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services in connection with the administration and enforcement thereof and compliance therewith);

(2) all fees and other costs incurred for services of such agents, attorneys and independent accountants as are employed by the Authority, the Borrower, the Sole Member or the Trustee to perform services required pursuant to the Loan Agreement, the other Borrower’s Documents or the Indenture;

(3) the Authority’s Fees and Expenses and all other fees and costs of the Authority, including without limitation reasonable fees and expenses of counsel to the Authority, not otherwise paid under the Loan Agreement, the Land Use Restriction Agreement or the Indenture, related to the issuance of the Bonds or in connection with its administration and enforcement of, and compliance with or interpretation of, the Indenture or any of the Borrower’s Documents, or otherwise in connection with the Project and the Bonds;

(4) all amounts advanced by the Authority or the Trustee under authority of the Indenture or any of the Borrower’s Documents that the Borrower is obligated to repay;

(5) any amounts required to be deposited in the respective Debt Service Reserve Accounts and Subaccounts in order to satisfy the applicable Debt Service Reserve Requirement pursuant to the Indenture; and should funds be withdrawn from a Debt Service Reserve Account or Subaccount, the Borrower will restore the difference between the amount on deposit in the applicable Debt Service Reserve Account or Subaccount and the related Debt Service Reserve Requirement from the next available deposits of Project Revenues and other deposits to the Revenue Fund made in accordance with the Indenture;

(6) amounts sufficient to maintain balances in the Repair and Replacement Fund and the Insurance and Tax Escrow Fund equal to the amounts required pursuant to the Indenture;

(7) all fees and expenses of the Rebate Analyst to provide the rebate calculations required under the Tax Agreement, and if a deposit is required to be made to the Rebate Fund as a result of any calculation made pursuant to the Tax Agreement, the Borrower will cause to be paid from Project Revenues the amount of such deposit in accordance with the terms of the Indenture;

(8) amounts required to be deposited in the Operating Fund sufficient to pay the Operating Expenses of the Project, as provided for in the Budget and in the Indenture;

(9) the Dissemination Agent Fee payable in accordance with and as provided under the Indenture and Continuing Disclosure Agreement;

(10) the Rating Agency Fee; and

(11) the costs and expenses associated with any audit of the Tax-Exempt Bonds by the Internal Revenue Service.

(iii) As security for its obligations to make the payments required in subsections (1) and (2) above, the Borrower will pay (or cause the Manager to pay) all Project Revenues from the Project, upon receipt, to the Trustee for deposit in the Revenue Fund.

(iv) In the event the Borrower fails to pay, or fails to cause to be paid, any Loan Payments (except to the extent certain amounts due in connection with the Loan and the Bonds are paid from amounts on deposit in the Debt Service Reserve Fund, the Repair and Replacement Fund or the Surplus Fund), the payment not paid will continue as an obligation of the Borrower until the unpaid amount has been fully paid, and the Borrower will pay, or

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cause to be paid, the same with interest thereon from the date of non-payment until the date so paid at the Default Rate.

Obligations Unconditional; Limited Recourse

The obligations of the Borrower to make the payments required under the Loan Agreement and to perform and observe the other agreements contained in the Loan Agreement will be absolute and unconditional and will not be subject to any defense or any right of setoff, counterclaim or recoupment arising out of any breach by the Authority or the Trustee of any obligation to the Borrower whether under the Loan Agreement or otherwise, or out of any Indebtedness or liability at any time owing to the Borrower by the Authority or the Trustee. Until such time as the principal of, premium, if any, and interest on the Bonds, and any costs incidental thereto is fully paid or provision for the payment thereof has been made in accordance with the Indenture, the Borrower (a) will not suspend or discontinue any payments described under the heading “Issuance of Bonds; Deposit of Proceeds; Amounts Payable,” (b) will perform and observe all other agreements contained in the Loan Agreement, and (c) except as provided in the Loan Agreement, will not terminate the Loan Agreement for any cause, including, without limiting the generality of the foregoing, failure of the Borrower to complete the acquisition, rehabilitation and equipping of the Project, the occurrence of any acts or circumstances that may constitute failure of consideration, destruction of or damage to the Project, the taking by eminent domain of title to or temporary use of any or all of the Project, commercial frustration of purpose, any change in the tax or other laws of the United States of America or of the State or any political subdivision of either or any failure of the Authority or the Trustee to perform and observe any agreement, whether express or implied, or any duty, liability or obligation arising out of or connected with the Loan Agreement or otherwise.

Nothing contained in this section “Obligations Unconditional; Limited Recourse” will be construed to release the Authority from the performance of any of the agreements on its part, and in the event the Authority or the Trustee fails to perform any such agreement on its part, the Borrower may institute such action against the Authority or the Trustee as the Borrower may deem necessary to compel performance so long as such action does not abrogate the obligations of the Borrower contained in the first sentence of the paragraph above. The Borrower may, at its own cost and expense and in its name or in the name of the Authority and with proper notice to the Authority, prosecute or defend any action or proceeding or take any other action involving third persons which the Borrower deems reasonably necessary in order to secure or protect the Borrower’s right of possession, occupancy and use of the Project, and in such event the Authority hereby agrees to cooperate fully with the Borrower, at the Borrower’s sole cost and expense and to take all action necessary to effect the substitution of the Borrower for the Authority in any such action or proceeding if the Borrower shall so request.

Notwithstanding the foregoing or any other provision or obligation to the contrary contained in the Loan Agreement or any other Bond Document, with the exception of any and all indemnities provided in the Bond Documents, which such indemnities will be a general obligation of the Borrower, (i) the liability of the Borrower under the Loan Agreement and the other Bond Documents to any person or entity, including, but not limited to, the Trustee or the Authority and their successors and assigns, is limited to the Borrower’s interest in the Project, the Project Revenues and the amounts held in the Funds and Accounts created under the Indenture or other Bond Documents or any rights of the Borrower under any guarantees relating to the Project, and such persons and entities will look exclusively thereto, to such other security as may from time to time be given for the payment of obligations arising out of the Loan Agreement or any other agreement securing the obligations of the Borrower under the Loan Agreement; and (ii) from and after the date of the Loan Agreement, no deficiency or other personal judgment, nor any order or decree of specific performance (other than pertaining to the Loan Agreement, any agreement pertaining to the Project or any other agreement securing the Borrower’s obligations under the Loan Agreement), will be rendered against the Borrower, the assets of the Borrower (other than the Borrower’s interest in the Project, the Loan Agreement, amounts held in the Funds and Accounts created under the Indenture, any rights of the Borrower under the Bond Documents), their officers, directors or members (including specifically the Sole Member) or its heirs, personal representatives, successors, transferees assigns, as the case may be, in any action or proceeding arising out of the Loan Agreement and the Indenture or any agreement securing the obligations of the Borrower under the Loan Agreement, or any judgment, order or decree rendered pursuant to any such action or proceeding.

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Assignment of Authority’s Rights

As security for the payment of the Bonds, the Authority in the Indenture assigns to the Trustee certain of the Authority’s rights under the Loan Agreement, including the right to receive payments under the Loan Agreement (except for any deposits to the Rebate Fund and the Reserved Rights), and the Borrower hereby assents to such assignment and agrees to make payments directly to the Trustee, without defense or set off by reason of any dispute between the Borrower and the Authority or the Trustee. By virtue of such assignment and certain obligations of the Borrower to the Trustee, the Authority will have no obligation to, and instead the Trustee will have the right without further direction from the Authority, to enforce the obligations of the Borrower under the Loan Agreement (except for the Unassigned Rights), subject to the limitations set forth in the Loan Agreement.

The Project

Disbursement of Project Fund. Amounts in the Project Fund will be disbursed by the Trustee as provided in the Indenture, upon delivery by the Borrower to the Trustee of a requisition executed by the Borrower Representative setting forth the nature of the amounts to be paid and the name of the payee and certifying that the amounts being paid are Costs of the Project. The execution of each requisition submitted for disbursements by the Borrower will constitute the certification, warranty, and agreement of the Borrower as follows:

(a) the Project is free and clear of all liens and encumbrances except Permitted Encumbrances;

(b) all evidence, statements, and other writings required to be furnished under the terms of the Loan Agreement and the Indenture are true and omit no material fact, the omission of which may make them misleading;

(c) all monies previously disbursed from the Project Fund have been used solely to pay for Costs of the Project, and the Borrower has written evidence to support this item of warranty;

(d) none of the items for which payment is requested have formed the basis for any payment previously made from the Project Fund; and

(e) all bills for labor, materials, and fixtures used, or on hand and to be used, in the rehabilitation or equipping of the Project have been paid.

Rate Covenant; Coverage. The Borrower will fix, charge and collect, or cause to be fixed, charged and collected rents, fees and charges in connection with the operation and maintenance of the Project such that for each Fiscal Year beginning with the Fiscal Year ending on or after December 31, 2017, the Debt Service Coverage Ratio will not be less than the applicable Coverage Test, determined as of the end of each such Fiscal Year based on and supported by Audited Financial Statements.

Failure to Meet Rate Covenant; Retention of Management Consultant. If the Coverage Test in any Fiscal Year ending on or after December 31, 2017, as set forth in the certificate delivered pursuant to the Loan Agreement, is not satisfied, the Borrower will retain a Management Consultant. Payment of the fees of the Management Consultant will be deemed an Operating Expense. The Management Consultant will prepare recommendations with respect to the operations of the Project and the sufficiency of the rates, fees and charges imposed by the Borrower.

The Management Consultant’s report will (a) include the projection of the Project Revenues, Operating Expenses and Net Income Available for Debt Service on a quarterly basis for not less than the next two Fiscal Years, and (b) make such recommendations to the Borrower as the Management Consultant believes are appropriate to enable the Borrower to increase the Debt Service Coverage Ratio to satisfy the Coverage Test for the current calendar year. If, in the judgment of the Management Consultant, it is not possible for the Borrower to meet such requirements, the report of the Management Consultant will so indicate and will project the Debt Service Coverage Ratio which could be achieved if the recommendations of the Management Consultant are followed. Continuous retention of a Management Consultant during the years that are the subject of the Management Consultant’s report will not be required, however, if the Borrower Representative delivers a certificate to the Trustee within 45 days after the end of each calendar quarter, setting forth the actual results for such quarter (which may be based on

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unaudited financial statements) and such results show that the Debt Service Coverage Ratio is projected by the Management Consultant is being met. The Borrower will, to the extent lawful and feasible and consistent with the preservation of the Sole Member’s 501(c)(3) status and compliance with the Land Use Restriction Agreement, follow the recommendations of the Management Consultant.

Failure of the Borrower to satisfy the Coverage Test covenant constitutes a Default under the Loan Agreement only if (a) the Borrower fails to engage the Management Consultant or, (b) to the extent that the Rating Agency agrees with such recommendations, the Borrower fails to implement its reasonable recommendations, to the extent possible and to the extent consistent with the charitable mission of the Sole Member, as required by the Loan Agreement.

Maintenance and Modification of Project. The Borrower agrees that during the term of the Loan Agreement it will at its own expense (i) keep the Project in a safe condition, (ii) keep the buildings and all other improvements forming a part of the Project in good repair and in good operating condition, making from time to time all necessary and proper repairs thereto and renewals and replacements thereof, including external and structural repairs, renewals, and replacements, and (iii) use the Equipment in the regular course of its business only, within the normal capacity of the Equipment, without abuse, and in a manner contemplated by the manufacturer thereof. The Borrower may, also at its own expense, from time to time make any Modifications to the Project it may deem desirable for its business purposes that do not, in the opinion of an Independent Architect filed with the Trustee, adversely affect the operation or value of the Project, and provided further, that such Modifications (other than any modifications made to the Project with the proceeds of the Bonds) will not cause the Debt Service Coverage Ratio to fall below the required Coverage Test for any Series of Bonds. Modifications to the Project so made by the Borrower will be on the Mortgaged Property, will become a part of the Project, and will become subject to the lien of the Mortgage. Any contract for such Modifications which is in an amount in excess of $500,000 will be made only by a contractor who furnishes performance and labor and material payment bonds in the full amount of such contract, made by the contractor thereunder as the principal and a surety company or companies rated “A” or higher by A. M. Best & Company, Inc. Such bonds must name the Borrower, the Authority, and the Trustee as obligees, and all Net Proceeds received under such bonds will be paid over to the Trustee and deposited in the Project Fund to be applied to the completion of the Modifications. Such money held by the Trustee in the Project Fund will be invested from time to time, as provided in the Indenture.

Forbearance and Subordination of Fees. The Borrower agrees that it, the Sole Member, and any Manager which is an Affiliate of the Borrower or Sole Member, will forbear from taking any management, administration, development or other fees, or any portions thereof, in the event and to the extent that money in the Revenue Fund are insufficient in any month to make all current and deferred deposits (other than deposits to the Surplus Fund) provided in the Indenture, and that the payment of such fees be made and in accordance with the Indenture. The Borrower agrees that any Management Agreement or Asset Management Agreement entered into with respect to the Project during the term of the Loan Agreement will be subject to this section.

Taxes and Impositions. Subject to the Loan Agreement, the Borrower agrees to pay, prior to delinquency, all real property taxes and assessments, general and special, and all other taxes and assessments of any kind or nature whatsoever, which are assessed or imposed upon the Project, or become due and payable, and which create, may create or appear to create a lien upon the Project, or any part thereof, or upon any personal property, equipment or other facility used in the operation or maintenance thereof (all of which taxes, assessments and other governmental and non-governmental charges of like nature are hereinafter referred to as “Impositions”); provided, however, that if, by law, any such Imposition is payable, or may at the option of the taxpayer be paid, in installments, the Borrower may pay the same together with any accrued interest on the unpaid balance of such Imposition in installments as the same become due and before any fine, penalty, interest or cost may be added thereto for the nonpayment of any such installment and interest. Payments made by the Trustee on behalf of the Borrower from funds held under the Indenture in the Insurance and Tax Escrow Fund will, to the extent of such payments, discharge the Borrower’s obligations under the Loan Agreement.

Subject to the applicable state law provisions, the Borrower will have the right before any delinquency occurs to contest or object to the amount or validity of any Imposition by appropriate legal proceedings.

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The Borrower will deposit with the Trustee amounts sufficient to pay the annual Impositions as set forth in the Budget to be next due on the Project, in accordance with the provisions of the Indenture.

Utilities. The Borrower will pay, or cause to be paid, when due, all utility charges which are incurred for the benefit of the Project or which may become a charge or lien against the Project for sanitation, gas, electricity, water or sewer services furnished to the Project and all other taxes, assessments or charges of a similar nature, whether public or private, affecting the Project or any portion thereof, whether or not such taxes, assessments or charges are liens thereon.

Insurance; Damage, Destruction and Condemnation; Use of Net Proceeds

Required Insurance. The Borrower will procure and maintain continuously in effect during the term of the Loan Agreement policies of insurance with respect to the Project insuring against such hazards and risks and in such amounts as are customary for a prudent owner of properties comparable to those comprising the Project, which will include the insurance set forth in the Loan Agreement.

Insurance Proceeds, Casualty and Condemnation Awards. After the occurrence of any casualty to the Project, or any part thereof, the Borrower will give prompt written notice thereof to the Trustee and each insurer and promptly submit a claim to insurer for payment of insurance proceeds; the Borrower will provide the Trustee with a copy of such claim.

All Insurance Proceeds with respect to the Project will be paid to the Trustee, and each insurer is authorized and directed under the Loan Agreement to make payment for any such loss directly to the Trustee instead of payment to the Borrower. Any Insurance Proceeds will be applied as provided in the Loan Agreement and in the Indenture. Damage or destruction of the Project will not affect the lien of the Mortgage or the obligations of the Borrower under the Loan Agreement, and the Trustee is authorized, at the Trustee’s option, to compromise and settle all loss claims on said policies if not adjusted promptly by the Borrower.

All Net Proceeds of Insurance Proceeds will be applied at the option of the Borrower either (i) to the payment of the Bonds in accordance with the Indenture and the Loan Agreement, or (ii) to the Restoration of the Project (if permitted by law, and to the extent not permitted by law, such Insurance Proceeds will be applied to the payment of the Bonds), except that (A) the proceeds of any loss of rents insurance will be deposited in the Revenue Fund under the Indenture and applied as therein provided and (B) any surplus proceeds will be applied to the payment of the Bonds as provided in the Loan Agreement and in the Indenture.

Unless the Borrower exercises its option to apply the Insurance Proceeds to the payment of the Bonds in accordance with the provisions of the Loan Agreement and of the Indenture, and so long as any Bonds will be Outstanding and unpaid, and whether or not Insurance Proceeds are sufficient or available therefor, the Borrower will promptly commence and complete with all reasonable diligence that Restoration of the Project as nearly as possible to the same value and revenue producing capacity which existed immediately prior to such loss or damage in accordance with plans and specifications prepared by an Independent Architect (“Restoration Plans”), and in compliance with all legal requirements. Any Restoration will be effected in accordance with procedures to be first submitted to and approved by the Trustee as provided in the Loan Agreement. The Borrower will pay all costs of such Restoration to the extent not paid from net proceeds of Insurance Proceeds available therefor pursuant to the Loan Agreement. If such Restoration is not permitted by law, the Insurance Proceeds will be applied to the payment of the Bonds.

To exercise the restoration option provided above, within 30 days following the deposit of Insurance Proceeds in accordance with the provisions of the Indenture, the Borrower will give written notice of the option they have selected to the Trustee. If such notice is to exercise the option of prepaying the Bonds, the Trustee will apply the Net Proceeds of such Insurance Proceeds in the manner provided in the Indenture. If such notice is to exercise the option of Restoration or if no such notice is received, the provisions of the paragraph above will control.

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Other Agreements

Assignment, Selling and Leasing. Except as otherwise provided in the Mortgage, or permitted under the provisions of the Land Use Restriction Agreement, after the completion of the acquisition, rehabilitation and equipping of the Project as described in the Loan Agreement, the Loan Agreement may be assigned and the Project sold or leased (other than by reason of foreclosure or deed in lieu of foreclosure), as a whole, by the Borrower only as permitted by the Loan Agreement or subject to conditions contained in the Loan Agreement.

Continued Existence. The Borrower agrees that during the term of the Loan Agreement it will maintain its existence, will continue to be a limited liability company in good standing in the State of Louisiana, will not dissolve or otherwise dispose of all or substantially all of its assets and will not consolidate with or merge into another legal entity or permit one or more other legal entities to consolidate with or merge into it; provided that the Borrower may, without violating the agreement contained in the Loan Agreement, consolidate with or merge into another legal entity, or permit one or more legal entities to consolidate with or merge into it, or sell or otherwise transfer to another legal entity all or substantially all of its assets as an entirety and thereafter dissolve; provided (a) that a Favorable Opinion of Bond Counsel is provided regarding such acquisition, consolidation, merger or transfer; (b) that if the surviving, resulting or transferee legal entity, as the case may be, is not the Borrower, then such legal entity will be a legal entity organized and existing under the laws of one of the states of the United States of America, will be a 501(c)(3) organization or a limited liability company whose sole member is a 501(c)(3) organization will be qualified to do business in the state where the Borrower’s Project is located, will be a single purpose entity whose only business operations will be operation of the Project and whose only assets and liabilities will be the Project (and assets and liabilities related thereto) and the Borrower’s Documents and permitted debt under the Loan Agreement, and will assume in writing in form and substance satisfactory to the Authority all of the obligations of the Borrower under the Loan Agreement and the other Borrower’s Documents; (c) that in the opinion of Independent Counsel, the Loan Agreement will be a valid and enforceable obligation of such surviving, resulting or transferee entity; (d) that no Event of Default has occurred and is continuing under the Loan Agreement; (e) that prior to such acquisition, consolidation, merger or transfer, the Borrower will furnish a Compliance Certificate to the Authority and the Trustee; and (f) that the Trustee will have consented to such transfer pursuant to the Land Use Restriction Agreement, unless such consent is not required pursuant to the Loan Agreement.

Other Indebtedness

The Borrower will not incur any Indebtedness with respect to the Project, other than the Loan and other debts permitted or anticipated in the Loan Agreement, or incurred in the ordinary course of business which do not give rise to a lien or encumbrance on the Project except for Permitted Encumbrances. In addition, the Borrower is permitted to incur the following:

(1) Indebtedness incurred as a result of the issuance of Additional Bonds;

(2) such Short-Term Indebtedness as the Borrower, in its judgment, deems expedient; provided that the aggregate amount of Short-Term Indebtedness outstanding at any time does not exceed 10% of the total Operating Expenses of the Borrower for the preceding Fiscal Year; and

(3) such Long-Term Indebtedness as the Borrower, in its judgment, deems expedient; provided that prior to incurring, assuming, or guaranteeing any Long-Term Indebtedness the Borrower must furnish to the Authority and the Trustee (i) a Certificate setting forth the terms of such Long-Term Indebtedness and stating that the incurrence of such Long- Term Indebtedness will not cause the Debt Service Coverage Ratio to fall below the required Coverage Test for any series of Bonds and (ii) the Confirmation of Rating stating that the incurrence of such Long-Term Indebtedness will not result in a qualification, downgrade or withdrawal of the then current ratings on the Bonds.

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The Borrower may secure Indebtedness incurred or assumed pursuant to (3) above by a lien on and security interests in all or any portion of the Project and the Project Revenues, secured on an equal and ratable basis with then Outstanding Senior Bonds or Subordinate Bonds, as applicable; provided, however, the following conditions are satisfied:

(A) The Indebtedness is being incurred or assumed for any of the same purposes for which Additional Bonds may be issued under the Indenture, or for the purpose of refunding or refinancing any Outstanding Bonds or other Indebtedness permitted under the Loan Agreement;

(B) The Indebtedness (other than Additional Bonds) will not be secured by the moneys and investments held in any fund established under the Indenture;

(D) Any agreement for the repayment of such Indebtedness and instruments evidencing or securing the same must provide:

(i) that any Default will be an Event of Default under the Indenture;

(ii) that, if any event of default has occurred in respect of such Indebtedness, the holder thereof will be entitled only to such rights to exercise, consent to or direct the exercise of remedies (other than remedies relating to any funds established under the Indenture) as are available to the Trustee, and that all such remedies are, except as otherwise provided in the Loan Agreement, to be exercised solely by the Trustee for the equal and ratable benefit of all Bondholders and all holders of Indebtedness so secured, but subject to the priorities provided in the Indenture with respect to Senior Bonds and Senior Parity Indebtedness and the Subordinate Bonds and Subordinate Parity Indebtedness;

(E) If the proposed Indebtedness is further secured by liens on properties and revenues other than the Project and/or Project Revenues, a lien of equal rank and priority will be granted upon the same properties and revenues to secure the Bonds; and

(F) For the purpose only of being entitled to remedies under the Loan Agreement and of consenting to or directing actions to be taken in respect to such remedies, the holders of any such Indebtedness will be treated as Bondholders and the Indebtedness held by such persons will be treated as Additional Bonds.

Any Short-Term Indebtedness or any Long-Term Indebtedness which is incurred for the purpose of providing working capital may be secured by a security interest on the Project Revenues on a parity with the security interest created under the Mortgage with respect to the Bonds, and if so secured, the agreement for the repayment of such Short-Term Indebtedness or Long-Term Indebtedness and instruments evidencing or securing the same will provide that: (i) any Default will be an Event of Default under the Indenture; and (ii) if any event of default shall have occurred with respect to such Short-Term Indebtedness or Long-Term Indebtedness, the holder thereof will be entitled only to such rights to exercise, consent to or direct the exercise of remedies as are available to the Trustee, and that all such remedies are, except as otherwise provided in the Loan Agreement, to be exercised solely by the Trustee for the equal and ratable benefit of all holders of Bonds and all holders of Short-Term Indebtedness or Long- Term Indebtedness so secured. Any agreement for the repayment of such Indebtedness and instruments evidencing or securing the same will provide for notices to be given to the Trustee regarding defaults by the Borrower, and will specify the rights of the Trustee to pursue remedies upon the receipt of such notice, and the sharing of the rights of the Trustee to control the exercise of remedies with the holder of such Indebtedness. Short-Term Indebtedness or Long-Term Indebtedness which is incurred for the purpose of providing working capital may also be secured by a security interest in Project Revenues which is subordinate to the security interest therein created under the Mortgage.

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Defaults and Remedies

Defaults. Each of the following constitutes a “Default” or “Event of Default” under the Loan Agreement:

(a) Failure by the Borrower to pay any Basic Loan Payments, subject to any applicable cure periods; provided that failure to make a Basic Loan Payment will not constitute a Default to the extent that the amounts on deposit in the Surplus Fund, the Bond Fund, the Repair and Replacement Fund and the Debt Service Reserve Fund are sufficient and available to pay principal, premium (if any) and interest due on the related Series of Bonds on the next Bond Payment Date; and provided further that failure to pay the portion of the Loan related to the Subordinate Bonds will not constitute a Default under the Loan Agreement while any Senior Bonds are Outstanding.

(b) Failure by the Borrower to make, or cause to be made, any Additional Loan Payment or other amounts required to be paid under the Loan Agreement on or before the date due.

(c) Failure by the Borrower to meet the Coverage Test covenant if (a) the Borrower fails to engage a Management Consultant or (b) to the extent that the Rating Agency, if any, agrees with such recommendations, the Borrower fails to implement any of the Management Consultant’s reasonable recommendations to the extent possible, and to the extent consistent with the charitable mission of the Sole Member, as provided in the Loan Agreement.

(d) Failure by the Borrower or the Sole Member to perform or observe any of its covenants or agreements contained in the Loan Agreement, the Tax Agreement or the Land Use Restriction Agreement other than as specified in the Loan Agreement, and such failure will continue for the period and after the notice specified in the Loan Agreement.

(e) The dissolution or liquidation of the Borrower or the filing by the Borrower of a voluntary petition in bankruptcy, or adjudication of the Borrower as a bankrupt, or assignment by the Borrower for the benefit of its creditors or the entry by the Borrower into an agreement of composition with its creditors, or the approval by a court of competent jurisdiction of a petition applicable to the Borrower in any proceeding instituted under the provisions of State law or the federal bankruptcy statute, as amended, or under any similar act which may hereafter be enacted. The term “dissolution or liquidation of the Borrower,” as used in this paragraph, will not be construed to include the cessation of the existence of the Borrower resulting either from a merger or consolidation of the Borrower into or with another entity or a dissolution or liquidation of the Borrower following a transfer of all or substantially all of its assets as an entirety, under the conditions permitting such actions contained in the Loan Agreement.

(f) The occurrence or continuance of a “default,” a “Default,” an “event of Default” or “Event of Default” under the Mortgage, the Land Use Restriction Agreement or the Indenture.

The provisions of (d) of this section are subject to the following limitation: if by reason of Force Majeure the Borrower is unable in whole or in part to carry out any of its agreements contained in the Loan Agreement (other than its obligations to pay certain amounts under the Loan Agreement), the Borrower will not be deemed in Default during the continuance of such inability, if, but only if, such default is cured as provided in the Loan Agreement. The Borrower agrees, however, to remedy with all reasonable dispatch the cause or causes preventing the Borrower from carrying out its agreements, provided that, subject to the preceding sentence, the settlement of strikes and other industrial disturbances will be entirely within the discretion of the Borrower and the Borrower will not be required to make settlement of strikes, lockouts and other industrial disturbances by acceding to the demands of the opposing party or parties when such course is in the judgment of the Borrower unfavorable to the Borrower.

The Trustee will not be deemed to have knowledge of any Default under the Loan Agreement other than a Default under paragraph (a) or (b) of this section, unless a Responsible Officer of the Trustee is specifically notified in writing of such Default by the Authority, the Borrower or by the Holders of at least 25% of the Bonds Outstanding.

Notice of Default; Opportunity to Cure. Except as provided below, no default under subsection (d) of the section entitled “Defaults” above will constitute a Default until:

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(a) The Trustee or the Authority, by Mail, will give notice to the Borrower of such default specifying the same; and

(b) The Borrower will have had 30 days after receipt of such notice to correct the default and will not have corrected it or, if such default cannot be corrected within 30 days, will have failed to initiate and diligently pursue appropriate corrective action, provided, that in any event such default must be remedied within 120 days after the date of occurrence thereof.

Remedies. Whenever any Default under the Loan Agreement has happened and is continuing, any or all of the following remedial steps will be available:

(a) The Trustee may, and at the written request of the Controlling Holders of the Bonds will, declare the outstanding principal balance and interest accrued on the Loan and all payments required to be made by the Borrower under the Loan Agreement with respect to the Bonds for the remainder of the term of the Loan Agreement to be immediately due and payable, whereupon the same will become immediately due and payable. Upon any such acceleration of the Loan, the Bonds will be subject to mandatory redemption as provided in the Indenture.

(b) The Trustee, for and on behalf of the Authority, may, and with the consent of the Controlling Holders of the Bonds will, take whatever action at law or in equity may appear necessary or desirable to collect the payments required to be made by the Borrower under the heading “Issuance of Bonds; Loan to Borrower; Related Obligations” then due and thereafter to become due, including, without limitation, pursuing remedies under the appropriate Mortgage and the remedies under the Indenture.

(c) The Authority or the Trustee may take whatever action at law or in equity as may be necessary or desirable to enforce performance and observance of any obligation, agreement or covenant of the Borrower under the Loan Agreement.

The provisions of clause (a), however, are subject to the condition that if, at any time after the Loan shall have been so declared due and payable, and before any judgment or decree for the payment of the money due shall have been obtained or entered, there shall have been deposited with the Trustee a sum sufficient to pay all the principal of the Bonds matured prior to such declaration and all matured installments of interest (if any) upon all the Bonds, with interest on such overdue installments of principal as provided in the Loan Agreement, and the reasonable expenses of the Trustee, and any and all other Defaults known to the Trustee (other than in the payment of principal of and interest on the Loan due and payable solely by reason of such declaration) shall have been made good or cured to the satisfaction of the Trustee or provision deemed by the Trustee to be adequate shall have been made therefor, then, and in every such case, the Controlling Holders of the Bonds by written notice to the Authority and to the Trustee, may, on behalf of the Holders of all the Bonds, rescind and annul such declaration and its consequences and waive such default; provided that no such rescission and annulment will extend to or will affect any subsequent default, or will impair or exhaust any right or power consequent thereon.

Options to Terminate Agreement

Grant of Option to Terminate. The Borrower has the option to terminate the Loan Agreement as a whole at any time the Borrower declares it will cease to use the Project by reason of:

(i) the damage or destruction of all or a significant portion of the Project (with property damage equal to at least $100,000) to such extent that, in the reasonable opinion of the Borrower, the Restoration thereof would not be economical;

(ii) the condemnation of all or part of the Project or the taking by condemnation of such part, use or control of the Project (with the value of the property so taken or condemned equaling at least $100,000) as to render it unsatisfactory to the Borrower for its intended use, provided that any temporary taking by condemnation will not give rise to the option unless, in the

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Borrower’s reasonable opinion, such temporary taking will render the Project unsatisfactory to the Borrower for their intended use for a period of at least six months;

(iii) any changes in the Constitution of the State of Louisiana or the Constitution of the United States or of legislative or administrative action (whether State, federal, or local), by which the Loan Agreement will become void or unenforceable or impossible of performance in accordance with the intent and purposes of the Loan Agreement; or

(iv) the Borrower may also prepay the Loan in whole and terminate the Loan Agreement if the Loan is prepaid in whole and in amounts necessary to redeem the Bonds pursuant to the Indenture upon delivery of written notice by the Borrower’s Representative to the Trustee delivered not less than 45 days prior to the prepayment date.

Exercise of Option to Terminate. To exercise such options, the Borrower will, within 90 days following the event authorizing such termination, if any, give written notice to the Authority and the Trustee, and will specify therein the date of termination, which date will be not less than 50 days nor more than 90 days from the date such notice is mailed, and will make arrangements satisfactory to the Trustee for the giving of the required notice of redemption of all of the Bonds. In order to exercise such option, the Borrower will pay, or cause to be paid, on or prior to the applicable redemption date, to the Trustee, an amount equal to the sum of the following:

(i) An amount of money which, when added to the amounts then on deposit under the Indenture and available for such purpose will be sufficient to retire and redeem all the Outstanding Bonds on the earliest possible redemption date after notice as provided in the Indenture, including, without limitation, the principal amount thereof, all interest to accrue to said redemption date; plus

(ii) An amount of money equal to the Ordinary Trustee’s Fees and Expenses and Extraordinary Trustee’s Fees and Expenses under the Indenture accrued and to accrue until such final payment and redemption of the Bonds, including fees and expenses related to such redemption; plus

(iii) An amount of money equal to the Authority’s Fees and Expenses under the Loan Agreement accrued and to accrue until such final payment and redemption of the Bonds.

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MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT

The following is a brief summary of certain provisions of the Mortgage for the Project. The Mortgage is in a form substantially similar to this summary. The summary does not purport to be complete or definitive and is qualified in its entirety by reference to the Mortgage, a copy of which is on file with the Trustee.

Granting Clauses

Pursuant to the Mortgage, the Borrower mortgages, pledges, affects, hypothecates and grants a continuing security interest in, to inure to the use and benefit of the Trustee, the Borrower’s right, title and interest in the facilities owned by the Borrower and located in New Orleans, Louisiana, including any apartment units, all necessary and useful furnishings, equipment and machinery, and such interests in land as may be necessary or suitable for the foregoing, including roads and rights of access, utilities and other necessary site preparation facilities, including the real (immovable) property situated in the Parish of Orleans, Louisiana described in Exhibit “A” attached to the Mortgage and made a part of the Mortgage, together with all buildings, structures, fixtures, additions, enlargements, extensions, improvements, modifications or repairs now or hereafter located thereon or therein, together with any and all Property, as defined in the Mortgage, that may, from time to time after execution of the Mortgage, by delivery or by writing of any kind, be subjected to the security interest created under the Mortgage by the Borrower or by anyone on its behalf (and the Trustee is authorized to receive the same at any time as additional security under the Mortgage by the Borrower), which subject to the security interest hereof of any such property as additional security may be made subject to any reservations, limitations, or conditions which will be set forth in a written instrument executed by the grantor or the person so acting on its behalf or by the Trustee respecting the use and disposition of such property or the proceeds thereof, and further together with the right to receive proceeds attributable to the insurance loss of the Property (as defined in the Mortgage) as provided in Louisiana Revised Statutes 9:5386.

All of the foregoing immovable and movable property and incorporeal rights covered by and subject to the Mortgage are collectively referred to as the “Property” in the Mortgage. Except as expressly provided in the Mortgage or in the Indenture, the Property is to remain so specially mortgaged, affected and hypothecated unto and in favor of Trustee until the full and final payment or discharge of the Indebtedness, and the Borrower is bound and obligated not to sell or alienate the Property to the prejudice of the Mortgage. Assignment of Leases and Rents.

In order to secure the full and punctual payment and performance of all present and future Indebtedness, up to the Maximum Amount (as defined in the Mortgage), the Borrower assigns and pledges to the Trustee, and grants a continuing security interest in all of the Borrower’s right, title and interest in and to (i) all leases or subleases affecting the Property or any part thereof, whether now existing or hereafter arising, together with any and all renewals, extensions or modifications thereof (the “Leases”) and (ii) all revenues, rentals, incomes, profits, security deposits and other sums due or becoming due under the Leases (the “Rents”). The pledge of Leases and Rents in the Mortgage is granted in accordance with and subject to the provisions of La. R.S. § 9:4401 et seq and Louisiana Civil Code Articles 3168 et seq.

Security Interests

In order to secure the full and punctual payment and performance of all present and future Indebtedness, the Borrower will grant to the Trustee a continuing security interest in and to all right, title and interest of the Borrower in, to or under (i) all Property constituting movable property, (ii) all Fixtures in, on, or attached to the Property, and (iii) all Proceeds and products of all or any of the preceding.

Events of Default

There will be an Event of Default under the Mortgage if there is an Event of Default under the Indenture. See “INDENTURE – Defaults and Remedies.”

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Remedies

Upon the occurrence of any Event of Default, the Trustee may take such action, without notice or demand, as it deems advisable to protect and enforce its rights against the Borrower and in and to the Mortgaged Property, all in accordance with the Indenture, including, but not limited to, the following actions, each of which may be pursued concurrently or otherwise, at such time and in such order as the Trustee may determine, in its sole discretion, without impairing or otherwise affecting the other rights and remedies of the Trustee: (i) institute proceedings for the complete foreclosure of the Mortgage in which case the Mortgaged Property may be sold for cash or upon credit in one or more parcels under ordinary or executory process, at the Trustee’s sole option, and with or without appraisement, appraisement being expressly waived; or (ii) institute an action, suit or proceeding in equity for the specific performance of any covenant, condition or agreement contained in the Mortgage; or (iii) recover judgment on the Indenture either before, during or after any proceedings for the enforcement of the Mortgage; or (iv) apply for the appointment of a trustee, receiver, liquidator or conservator of the Mortgaged Property, without regard for the adequacy of the security for the Indebtedness and without regard for the solvency of the Borrower or of any person, firm or other entity liable for the payment of the Indebtedness; or (v) sell the Collateral constituting movable property or any part thereof at public or private sale, for cash, upon credit or for future delivery, at such price or prices as the Trustee may deem satisfactory, and in connection with any such sale, the Borrower specifically waives all rights of redemption, stay or appraisal which it has or may have under any law now existing or hereafter adopted and agrees that 30 days prior written notice of the time and place of any such sale or other intended disposition of any of the Collateral constitutes “reasonable notification” within the meaning of Section 9-611 of the UCC, except that shorter or no notice will be reasonable as to any Collateral which is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market; or (viii) pursue such other remedies as the Trustee may have under applicable law, including, without limitation, as a secured party under the UCC.

The proceeds or avails of any sale made under or by virtue of this section, together with any other sums which then may be held by the Trustee under the Mortgage, whether under the provisions of this section or otherwise, will be applied in such manner as provided in the Indenture.

Upon any sale made under or by virtue of this section, the Trustee may bid for and acquire the Mortgaged Property or any part thereof and in lieu of paying cash therefor may make settlement for the purchase price by crediting upon the Indebtedness the net sales price after deducting therefrom the expenses of the sale and the costs of the action and any other sums which the Trustee is authorized to deduct under the Mortgage.

The Trustee may proceed under the Mortgage solely as to the immovable property interests, or solely as to the movable property interests, or as to both the immovable and movable property interests in accordance with its rights and remedies in respect of the immovable property interests.

The Trustee, in the Trustee’s sole discretion, may require, as a prerequisite to the commencement of any proceeding with respect to the Mortgaged Property that it be provided evidence reasonably satisfactory to the Trustee that the Mortgaged Property is not contaminated by hazardous substances or, if it is, that the Trustee will not incur any liability as a result of such proceeding. The Trustee will have the authority to use and expend the Mortgaged Property to (i) conduct environmental assessments, audits, and site monitoring to determine compliance with any environmental laws thereunder, (ii) take all appropriate remedial action to contain, clean up or remove any environmental hazard including a spill, release, discharge or contamination, either on its own accord or in response to an actual or threatened violation of any environmental laws thereunder, (iii) institute legal proceedings concerning environmental damage or contest or settle proceedings brought by any local, state or federal agency litigant; (iv) comply with any local, state or federal agency order or court order directing an assessment, abatement or cleanup of any hazardous substances; (v) employ agents, consultants and legal counsel to assist to perform the above undertakings or actions; or (vi) exercise any other right or remedy provided in the Mortgage.

The Trustee will not be personally liable to the Borrower or any other person for any decrease in value of the Mortgaged Property by reason of Trustee’s compliance with any environmental laws, specifically including any reporting requirement under any such requirements. Neither the acceptance by the Trustee of the Mortgaged Property nor failure by the Trustee to inspect the Mortgaged Property will be deemed to create any inference as to whether or not there is or may be liability under any environmental laws with respect to such Mortgaged Property.

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The Trustee will be under no obligation to institute any suit, or take any remedial proceeding under the Mortgage, or to enter any appearance in or in any way defend against any suit, in which it may be a defendant, or to take any steps in the enforcement of any rights and powers under the Mortgage until it shall be indemnified to its satisfaction against any and all costs and expenses, outlays and counsel fees and other reasonable disbursements, or against all liability.

Notwithstanding anything contained in the Mortgage to the contrary, upon the occurrence and continuance of an Event of Default, before taking any foreclosure action or any action which may subject the Trustee to liability under any environmental law, statute, regulation or similar requirement relating to the environment, the Trustee may require that a satisfactory indemnity bond, indemnity or environmental impairment insurance be furnished for the payment or reimbursement of all expenses to which it may be put and to protect it against all liability resulting from any claims, judgments, damages, losses, penalties, fines, liabilities (including strict liability) and expenses which may result from such foreclosure or other action.

Foreclosure/Confession of Judgment

For purposes of foreclosure under Louisiana executory process procedures, the Borrower acknowledges and confesses judgment in favor of Trustee for the full amount of the Indebtedness within the Mortgage.

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THE LAND USE RESTRICTION AGREEMENT

The following is a brief summary of certain provisions of the Land Use Restriction Agreement among the Authority, the Borrower and the Trustee. The Land Use Restriction Agreement is in a form substantially similar to this summary. The summary does not purport to be complete or definitive and is qualified by reference to the Land Use Restriction Agreement, copies of which are on file with the Trustee.

The Borrower, the Authority and the Trustee have entered into the Land Use Restriction Agreement (“Land Use Restriction Agreement”) that will restrict the Borrower’s use of the Project so as to satisfy the requirements of Sections 102 and 142(d) of the Internal Revenue Code of 1986, as amended (the “Code”).

Covenant with Respect to Tax Status of the Bonds

The Authority and the Borrower each covenants that it will not knowingly take, or permit to be taken, or fail to take, any action that would adversely affect the excludability from gross income for federal income tax purposes of interest on the Tax-Exempt Bonds throughout the Qualified Project Period and the Trustee covenants that it will not invest or use any of the proceeds of the Bonds except as otherwise directed by the Borrower in writing.

Qualified Residential Rental Project Requirements

The Project will, throughout the Qualified Project Period, unless the Land Use Restriction Agreement is earlier terminated, satisfy the following terms and conditions, limitations and restrictions:

(a) Satisfaction of Applicable Legal Requirements. The Project is being acquired, rehabilitated, equipped and installed for the purpose of providing multifamily Residential Rental Units, and the Project will be owned, managed and operated as multifamily Residential Rental Units, all in accordance with the qualified residential rental project requirements of Section 142(d) of the Code and the applicable residential rental project provisions of Treas. Reg. § 1.103-8(b) and the administrative guidance issued thereunder;

(b) Similarly Constructed Residential Rental Units. All of the Residential Rental Units in the Project will be similarly constructed;

(c) Transient Use. During the term of the respective Land Use Restriction Agreement, (i) none of the Residential Rental Units in the Project will at any time be utilized on a transient basis, (ii) none of the Residential Rental Units in the Project will ever be leased or rented for a period of less than 30 days and (iii) neither the Project nor any portion thereof will ever be used as a hotel, motel, dormitory, fraternity house, sorority house, rooming house, hospital, sanitarium, nursing home, rest home, trailer court or park or for any other use on a transient basis;

(d) General Public Availability. During the term of the Land Use Restriction Agreement, (i) the Residential Rental Units in the Project will be leased and rented or made available for rental on a continuous basis to members of the general public except as otherwise permitted by federal, state or local law, and (ii) the Borrower will not give preference in renting Residential Rental Units in the Project to any particular class or group of persons, other than Qualified Tenants as provided in the Land Use Restriction Agreement; provided, however, that Residential Rental Units in the Project may be occupied by maintenance, security or managerial employees of the Borrower or its property manager who are reasonably required to maintain residences in the Project, but only to the extent such occupation does not cause the Project to cease to be a qualified residential rental project under Section 142(d) of the Code;

(e) Use of Related Facilities by Tenants. Any functionally related and subordinate facilities (e.g., parking areas, laundry facilities, tenant offices, physical therapy rooms, dining rooms, meeting rooms, common areas, swimming pools, tennis courts, etc.) (the “Related Facilities”) for the Project will be made available to all tenants of the Project on an equal basis. Fees charged to residential tenants for use of the Related Facilities will be commensurate with fees charged for similar facilities at similar residential rental properties in the surrounding area and, in no event will any such fees charged to tenants of the Project be discriminatory or exclusionary as to the Low

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and Moderate Income tenants of the Project. No Related Facilities will be made available to persons other than tenants or their guests. Parking, if available, will be made available to all tenants on a first come, first served basis;

(f) No Continual or Frequent Nursing, Medical or Psychiatric Services. No continual or frequent nursing, medical or psychiatric services will be provided to the residents of the Project at any time or in any manner;

(g) Ownership, Structure and Financing. The Project will consist of one or more buildings or structures, all of which will be (i) owned by the same person for federal tax purposes, (ii) located on a single tract of land, consisting of any parcel of land or two or more parcels of land that are contiguous except for being separated only by a road, street, stream or similar property (parcels are contiguous if their boundaries meet at one or more points) and (iii) financed with proceeds of the Tax-Exempt Bonds or otherwise pursuant to a common plan of financing. Each such building or structure is a discrete edifice or other man-made construction consisting of an independent foundation, outer walls and roof and containing five or more similarly constructed units;

(h) Condominium Ownership. During the term of the Land Use Restriction Agreement, the Borrower will not convert the Project to condominium ownership;

(i) Borrower Rentals. During the term of the Land Use Restriction Agreement, no Residential Rental Unit in the Project will be occupied by the Borrower (or a Related Person) at any time unless the Borrower (or a Related Person) resides in a Residential Rental Unit in a building or structure that contains at least five Residential Rental Units and unless the resident of such Residential Rental Unit is a resident manager or other necessary employee (e.g., maintenance and security personnel);

(j) [Certificate of Project Commencement and 50% Occupancy. Within 30 days after the later of the issue date of the Bonds or the date on which 10% of the Residential Rental Units in the Project are first occupied following the construction thereof, the Borrower will file with the Authority a certificate identifying such date. Within 30 days after the later of the issue date of the Bonds or the date on which 50% of the Residential Rental Units in the Project are occupied, the Borrower will file with the Authority and the Trustee a certificate identifying such date and the beginning date and earliest ending date of the Qualified Project Period];

(k) No Discrimination. During the term of the Land Use Restriction Agreement, the Borrower will not discriminate on the basis of age, race, color, creed, national origin, religion, sex or marital status in the lease, use or occupancy of the Project except as otherwise permitted by federal, state or local law or in connection with the employment or application for employment of persons for the operation and management of the Project; and the Borrower specifically agrees that the Borrower will not refuse to lease units or deny occupancy in the Project to persons whose family includes minor dependents who will occupy such unit, unless such refusal is based upon factors not related to the presence of such minors in the family;

(l) Payment of Expenses. During the term of the Land Use Restriction Agreement, the Borrower will make timely payment of the fees and expenses, if any, of the Trustee in accordance with the provisions of the Land Use Restriction Agreement, the Indenture and the Loan Agreement, including any expenses incurred by the Trustee in the performance of its duties and obligations under the Land Use Restriction Agreement;

(m) Certification of Income. As a condition of occupancy, each Qualified Tenant will be required to sign and deliver to the Borrower a Certification of Income, in a form designed to establish compliance with the applicable provisions of the Code and the Treasury Regulations, or as otherwise required by the Internal Revenue Service. Such Qualified Tenant will also be required to provide whatever other information, documents or certifications are deemed necessary by the Borrower or the Authority to substantiate the Certification. All Certifications of Income with respect to each Qualified Tenant who resides in a Residential Rental Unit in the Project or resided in a Residential Rental Unit during the immediately preceding calendar year will be maintained on file at the main business office of the Project and will be available for inspection by the Authority and the Trustee;

(n) Annual Determinations. The determination of whether a resident of the Project is a Qualified Tenant will be made at least annually on the basis of the current income of all the residents of the Residential Rental Unit. Each lease to a Qualified Tenant entered into after the date of the Land Use Restriction Agreement will

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require the tenant to sign the Certification of Income annually, attesting to the combined income of all the occupants of each Residential Rental Unit and at any other time as the Borrower may reasonably request;

(o) Subsequent Changes to Income. If a tenant is a Qualified Tenant upon commencement of occupancy of a Residential Rental Unit, the income of such tenant will be treated as Low or Moderate Income. The preceding sentence will not apply to any tenant whose income as of the most recent annual determination under paragraph (n) of this section exceeds 140% of Low and Moderate Income if, after such determination, but before the next annual determination, any Residential Rental Unit of comparable or smaller size in (i) the same building (within the meaning of Section 42 of the Code), provided that the Project is eligible for low-income housing tax credits under Section 42 of the Code or (ii) the Project, if the Project is not eligible for low-income housing tax credits under Section 42 of the Code, is occupied by a new tenant who does not qualify as a Qualified Tenant;

(p) Form of Lease. Any lease used in renting any Residential Rental Unit in the Project to a Qualified Tenant will provide for termination of the lease and consent by such tenant to immediate eviction, subject to applicable provisions of laws of Louisiana law, for failure to qualify as a Qualified Tenant as a result of any material misrepresentation made by such person with respect to any Certification of Income. Each Qualified Tenant occupying a Residential Rental Unit will be required to execute a written lease that will be effective for a term of at least six months. No meals or other services will be provided to tenants of the Project;

(q) Borrower’s Certification. On the first day of each month after any Residential Unit in the Project is available for occupancy, the Borrower will prepare a record of the percentage of Residential Rental Units of the Project occupied (and treated as occupied) by Qualified Tenants during the preceding month. Such record will be maintained on file at the main business office of the Project, will be available for inspection by the Authority and the Trustee and will contain such other information and be in the form required by the Authority and/or Trustee, as applicable;

(r) Occupancy Standards. The Project will satisfy the Occupancy Standards; and

(s) Records Maintenance and Inspection. During the term of the Land Use Restriction Agreement, the Borrower will (i) maintain complete and accurate records pertaining to the Residential Rental Units occupied or to be occupied by Qualified Tenants, and (ii) permit any duly authorized representative of the Trustee, the Authority, the Department of the Treasury or the Internal Revenue Service to inspect the books and records of the Borrower upon reasonable notice and at reasonable times.

Transfer Restrictions

For the Qualified Project Period, except with respect to events such as foreclosure or deed in lieu of foreclosure or other, involuntary loss or other events described in Treas. Reg. § 1.103-8(b)(6)(iii)(a) and not otherwise described in paragraph (b) thereof, provided that proceeds received as a consequence of such events are used as provided in Treas. Reg. § 1.103-8(b)(6)(iii)(a), the Borrower will not Transfer the Project or any interest therein, in whole or in part, except in accordance with the terms of the Indenture and Loan Agreement (or either of them) and under the Land Use Restriction Agreement. Any Transfer of the Project or any interest therein, in whole or in part, will only be permitted if: (1) the Borrower will not be in default of the Land Use Restriction Agreement; (2) the purchaser or assignee will assume in writing in a form acceptable to the Authority, all duties and obligations of the Borrower under the Land Use Restriction Agreement and execute any necessary or appropriate document with respect to assuming its obligations under the Land Use Restriction Agreement and the Financing Agreements in the form of an Assumption Agreement, which document will be recorded in the Clerk’s office of the Orleans Parish, Louisiana; (3) the Trustee will have received an opinion of Bond Counsel to the effect that such transfer will not adversely affect the exclusion of the interest on the Bonds from gross income of the owners thereof for federal income tax purposes; (4) [omitted]; (5) the Borrower will deliver to the Trustee an opinion of counsel to the transferee that the transferee has duly assumed the obligations of the Borrower under the Land Use Restriction Agreement and that such obligations and the Agreement are binding on the transferee; and (6) such other conditions are met as are set forth in or referred to in the Financing Agreements (i) to protect the exclusion of the interest on the Tax-Exempt Bonds from gross income of the owners thereof for federal income tax purposes, (ii) to ensure that the Project is not acquired by a person that has pending against it, or that has a history of, building code violations, as identified by municipal, county, state or federal regulatory agencies, and (iii) to provide that indemnification of the

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Authority and the Trustee under the Land Use Restriction Agreement is assumed by the purchaser or assignee. The Borrower will deliver the Assumption Agreement and the items specified in Clauses (3), (4) and (5) above to the Trustee, with copies to the Authority, at least 10 business days prior to a proposed Transfer.

Enforcement

The Borrower further represents, warrants and covenants that:

(a) Examination of Records. The Borrower will permit, after two business days' prior notice, any duly authorized representative of the Authority and the Trustee to inspect any books and records of the Borrower regarding the Project, particularly with respect to the incomes of Qualifying Tenants that pertain to compliance with the provisions of the Agreement and Section 142(d) of the Code. Any certification, records or other documents deemed necessary by the Authority or the Trustee to show the Project’s compliance with Section 142(d) of the Code will be maintained on file at the Project site until the later of (i) the date that the Bonds (and any tax-exempt obligations used to refund any of the Bonds) remain outstanding and for four years thereafter or (ii) the end of the Qualified Project Period;

(b) Other Information. The Borrower will provide such other information, documents or certifications requested by the Authority or the Trustee that the Authority or the Trustee, as applicable, deems reasonably necessary, to substantiate the Borrower’s continuing compliance with the provisions of the Agreement and Section 142(d) of the Code; and

(c) Reliance on Borrower or Tenant Certification. In the enforcement of the Land Use Restriction Agreement, the Authority or the Trustee may rely on any certificate delivered by or on behalf of the Borrower or any tenant concerning the Project.

Violations

(a) Notice. The Borrower will inform the Authority and the Trustee by written notice of any violation of the Borrower’s obligations under the Land Use Restriction Agreement or the occurrence or existence of any situation or event (an “Adverse Development”) that would cause the interest on the Tax-Exempt Bonds to become includable in the gross income of their holders for federal income tax purposes within five days after discovering any such adverse development, and the Trustee covenants and agrees to inform the Borrower by written notice of any Adverse Development that, in the opinion of Bond Counsel, would cause the interest on the Bonds to become includable in the gross income of their holders for federal income tax purposes within 30 days after discovering such Adverse Development;

(b) Time to Correct. The Borrower will correct or rectify any adverse development no later than 30 days after such Adverse Development is first discovered or should have been discovered by the Borrower’s exercise of reasonable diligence. The Authority and the Trustee covenant and agree to provide the Borrower a period of time, which will be at least 30 days after the date such Adverse Development is first discovered or should have been discovered by the Borrower’s exercise of reasonable diligence, or if later, within such further time which may be approved in an opinion of Bond Counsel, in which to correct any Adverse Development. If any such Adverse Development is not corrected to the satisfaction of the Authority (relying solely upon the advice of Bond Counsel) within the period of time specified by the Authority or the Trustee, without further notice, the Authority or the Trustee, as applicable, may declare a default under the Land Use Restriction Agreement, effective on the date of such declaration of default, and upon such default, the Borrower will pay to the Trustee an amount equal to any rents or other amounts received by the Borrower for any Residential Rental Units in the Project that were occupied in violation of the Land Use Restriction Agreement during the period such violation continued and the Trustee will deliver such amounts to the Authority within 10 business days;

(c) Specific Performance. The Authority and/or the Trustee and/or, to the extent permitted in the Indenture, to the extent permitted in the Financing Agreements (as defined in the Land Use Restriction Agreement), any owner of any of the Bonds, may also apply, individually or collectively, to any court, state or federal, for specific performance of the Land Use Restriction Agreement, or for an injunction against any violation of the

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Agreement, or for any other remedies at law or in equity or for any such other actions as will be necessary or desirable so as to correct non-compliance with the Land Use Restriction Agreement.

Amendment

The Land Use Restriction Agreement may be amended to reflect changes in Section 142(d) of the Code, the applicable Regulations and administrative guidance promulgated thereunder. The Authority and the Borrower each will take any lawful action (including amendment of the Agreement) (in the case of the Trustee, upon payment of its fees and expenses related to such action) if, in the opinion of Bond Counsel, such action is necessary to comply fully with all applicable rules, rulings, policies, procedures, regulations or other official statements promulgated or proposed by the Department of the Treasury or the Internal Revenue Service from time to time pertaining to obligations issued under Section 142(d) of the Code and affecting the Project. No amendment of the Land Use Restriction Agreement will be made without the prior written approval of the Authority, the Trustee and the Company and an approving opinion of Bond Counsel that such amendment will not adversely affect the tax-exempt status of the Bonds.

Termination

The Land Use Restriction Agreement will terminate:

(a) Completion. Upon the termination of the Qualified Project Period;

(b) Involuntary Non-Compliance. In the event of an involuntary non-compliance caused by unforeseen events, such as fire, seizure, requisition, change in a federal law or an action of a federal agency after the date of issuance of the Tax-Exempt Bonds that prevents the Authority or the Trustee from enforcing the provisions of the Agreement or condemnation or similar event, provided that: (i) the Tax-Exempt Bonds are retired at their first applicable available call date, or (ii) any insurance proceeds or condemnation award or other amounts received as a result of such loss or destruction are used to provide a project that meets the requirements of Section 142(d) of the Code and Treas. Reg. § 1.103-8(b) as amended, or any successor law or regulation; or

(c) Certain Transfers. In the event of foreclosure, transfer of title by deed in lieu of foreclosure, or similar event, following which and within a reasonable period of time the Tax-Exempt Bonds are redeemed or the amounts received as a consequence of such event are used to provide a qualified residential rental project meeting the applicable requirements of the Code and the Regulations, unless, at any time subsequent to such event and during the Qualified Project Period, the Borrower or any direct successor in interest, or any transferee from the Borrower or its successor subject to an Assumption Agreement, or any Related Person to such persons, or any other person who was, prior to the event of foreclosure or other such event, an obligor on any Purpose Investment issued in connection with any financing for the Project, obtains an ownership interest in the Project for tax purposes;

(d) Opinion of Bond Counsel. Upon the delivery of an opinion of Bond Counsel acceptable to the Authority and the Trustee that continued compliance with the requirements of the Land Use Restriction Agreement is not required in order for interest on the Tax-Exempt Bonds to be and continue to be excludible from gross income of the holders of the Tax-Exempt Bonds for federal income tax purposes;

(e) Redemption of Bonds. Upon defeasance or redemption of the Bonds, the Trustee will have no further obligation under the Land Use Restriction Agreement.

Post-Defeasance

If the Tax-Exempt Bonds are defeased but the Land Use Restriction Agreement remains in full force and effect, the Borrower will contract, at Borrower’s expense, with a compliance monitoring agent reasonably satisfactory to the Authority, to review compliance by the Borrower with the requirements of the Land Use Restriction Agreement.

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Covenants Run with the Land; Successors Bound

The Borrower subjects the Real Estate to the covenants, reservations and restrictions set forth in the Land Use Restriction Agreement. The Authority, the Trustee and the Borrower declare their express intent that the covenants, reservations and restrictions set forth in the Land Use Restriction Agreement will be deemed covenants, reservations and restrictions running with the land to the extent permitted by law and will pass to and be binding upon the Borrower’s successors in title to the Real Estate throughout the term of the Land Use Restriction Agreement. Each and every contract, deed, mortgage, or other instrument hereafter executed covering or conveying the Real Estate or any portion thereof or interest therein will conclusively be held to have been executed, delivered and accepted subject to such covenants, reservations and restrictions, regardless of whether such covenants, reservations and restrictions are set forth in such contract, deed, mortgage or other instrument.

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APPENDIX C

FORM OF BOND COUNSEL OPINION

The form of the approving legal opinion of Butler Snow LLP, bond counsel, is set forth below. The actual opinion will be delivered on the date of delivery of the Bonds referred to therein and may vary from the form set forth to reflect circumstances both factual and legal at the time of such delivery. Recirculation of the Official Statement shall create no implication that Butler Snow LLP has reviewed any of the matters set forth in such opinion subsequent to the date of such opinion.

[Closing Date]

Louisiana Local Government Environmental Facilities and Community Development Authority Baton Rouge, Louisiana

RE: $______Louisiana Local Government Environmental Facilities and Community Development Authority Multifamily Housing Revenue Bonds (The Cove at NOLA Apartments) Series 2017A (the “Series 2017A Bonds”)

$______Louisiana Local Government Environmental Facilities and Community Development Authority Multifamily Housing Revenue Bonds (The Cove at NOLA Apartments) Subordinate Series 2017B (the “Series 2017B Bonds” and collectively with the Series 2017A Bonds, the “Bonds”)

Ladies and Gentlemen:

We are acting as bond counsel to the Louisiana Local Government Environmental Facilities and Community Development Authority (the “Issuer”) in connection with the issuance of the above captioned Bonds. In such capacity, we have examined such law, certified proceedings, and other documents as we have deemed necessary to render this opinion.

The Bonds are issued pursuant to the Chapter 10-D of Title 33 of the Louisiana Revised Statutes of 1950, as amended (La. R.S. 33:4548.1 through 4548.16, as amended (the “Act”) and resolutions of the Executive Committee of the Board of Directors of the Issuer (the “Bond Resolution”). The Bonds are being issued under a Trust Indenture, dated as of April 1, 2017 (the “Indenture”) between the Issuer and Wilmington Trust, N.A., as trustee (the “Trustee”). The Issuer and 2016 AVHG Cove, LLC (the “Borrower”), have entered into a Loan Agreement, dated as of April 1, 2017 (the “Loan Agreement”), pursuant to which the Borrower has agreed to pay to the Issuer such loan payments as will always be sufficient to pay the principal of, premium, if any, and interest on the Bonds as the same become due. As security for the payment of the Bonds, the Issuer has assigned to the Trustee under the Indenture and pledged to the payment of the Bonds, all right, title and interest of the Issuer in and to the Trust Estate (as such term is defined in the Indenture).

Reference is hereby made to an opinion of Brennan, Manna & Diamond, LLC, Jacksonville, Florida, dated the date hereof, relating, among other matters, to the status of the Borrower as an exempt organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the “Code”) and exempt from federal taxation under Section 501(a) of the Code.

As to questions of fact material to our opinion, we have relied upon (a) representations of the Issuer and the Borrower, (b) certified proceedings and other certifications of public officials furnished to us, and (c) certifications furnished to us by or on behalf of the Borrower (including certifications made in (i) the Tax Regulatory Agreement and No-Arbitrage Certificate (the “Tax Agreement”), dated the date of issuance of the Bonds, among the Issuer, the Borrower and the Trustee and (ii) the Land Use Restriction Agreement, dated the date of issuance of the Bonds (the “Land Use Restriction Agreement”), among the Issuer, the Borrower and the Trustee, which are material to Paragraph 4 below), without undertaking to verify the same by independent investigation. In all such examinations,

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we have assumed the genuineness of all signatures, the authenticity of all documents presented to us as originals, and the conformity to original documents of all copies submitted to us as certified, conformed, or photographic copies. As to certificates, we have assumed the same to be properly given and to be accurate. With respect to matters of fact relevant to this opinion, we have relied, without independent verification of the accuracy or completeness of the matters set forth therein, on the representations and warranties of the parties thereto set forth in the documents and instruments pursuant to which the Bonds are being issued and secured, as well as in certificates of officers of the Issuer and the Borrower delivered in connection with the issuance of the Bonds.

In our capacity as Bond Counsel, we have not been engaged or undertaken to express and we do not express any opinion (other than as may be expressly set forth herein) with respect to (a) the legal existence or the due authorization, execution, or delivery by or enforcement against the Borrower of any instrument or agreement in connection with the project financed with the proceeds of the Bonds (the “Project”) or the Bonds, (b) title to the Project or compliance with zoning, land use, and related laws, (c) the status of any lien or matter of record or security interest purported to be created in connection with the foregoing, (d) the accuracy, completeness, or sufficiency of the official statement relating to the Bonds dated April __, 2017 (the “Official Statement”) (except to the extent stated in our supplemental opinion addressed solely to Stifel Nicolaus & Company, Inc. dated the date hereof) or any other offering material relating to the Bonds or (e) the financial condition or capabilities of the Issuer or the Borrower.

Based upon the foregoing, and subject to the qualifications stated below, we are of the opinion, as of the date hereof and under existing statutes, regulations, rulings, and court decisions, that:

1. The Issuer has the power and authority to (a) adopt the Bond Resolution and perform the agreements on its part contained therein, (b) issue, sell, and deliver the Bonds and use the proceeds thereof upon the terms and conditions and for the purposes set forth in the Loan Agreement and in the Indenture, (c) enter into and perform its obligations under the Loan Agreement and the Indenture, and (d) create the assignment, pledge, and security interest under the Indenture in favor of the owners of the Bonds.

2. The Bond Resolution has been duly adopted by the Issuer, and the Loan Agreement and the Indenture have been duly authorized, executed, and delivered by the Issuer and constitute valid and binding obligations of the Issuer enforceable upon the Issuer. The Indenture creates a valid lien on the Trust Estate.

3. The Bonds (a) have been duly authorized, executed, and issued by the Issuer and delivered to the Trustee for authentication and (b) are valid and binding special or limited obligations of the Issuer payable solely from the Trust Estate.

4. Under the laws, regulations, rulings and judicial decisions in effect as of the date hereof, interest on the Bonds is excludable from gross income for federal income tax purposes. Furthermore, interest on the Bonds will not be treated as a specific item of tax preference, under Section 57(a)(5) of the Code, in computing the alternative minimum tax for individuals and corporations. In rendering the opinions in this paragraph, we have assumed continuing compliance with certain covenants made by the Issuer and the Borrower in the Tax Agreement and the Land Use Restriction Agreement designed to meet the requirements of Section 103 of the Code. Failure to comply with such covenants may cause interest on the Bonds to be includable in gross income retroactive to the date of the issuance of the Bonds. In rendering the foregoing opinion, we have relied upon the opinion of Brennan, Manna & Diamond, LLC, Jacksonville, Florida, regarding the status of the Sole Member as an organization described in Section 501(c)(3) of the Code and the characterization of the Borrower as disregarded entities for federal income tax purposes.

5. Under the laws, regulations, rulings and judicial decisions in effect as of the date hereof, interest on the Bonds is exempt from all present taxes imposed by the State of Louisiana and any parish, municipality or other political subdivision of the State of Louisiana.

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With respect to matters in (1) and (2) above, we are relying on the legal opinion of counsel to the Issuer, as to the due authorization, execution and delivery by and enforceability against the Issuer of the Bonds, the Indenture and the Loan Agreement.

Except as expressly stated above, we express no opinion as to any other federal or any other state income tax consequences of acquiring, carrying, owning, or disposing of the Bonds. Owners of the Bonds should consult their tax advisors as to the applicability of any collateral tax consequences of ownership of the Bonds, which may include purchase at a market discount or at a premium, taxation upon sale, redemption, or other disposition, and various withholding requirements.

It is to be understood that the rights of the owners of the Bonds and the enforceability of the Bonds, the Indenture, and the Loan Agreement may be limited by bankruptcy, insolvency, reorganization, moratorium, and other similar laws affecting creditors’ rights generally and by equitable principles, whether considered at law or in equity.

This opinion is given as of the date hereof and we assume no obligation to update, revise, or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention or any changes in law that may hereafter occur. This opinion is given solely for the use and benefit of the addressee hereof, and only in connection with the issuance and delivery of the Bonds and may not be used or relied upon by any other person or in connection with any other transaction, except with express consent of this firm.

Very truly yours,

BUTLER SNOW LLP

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APPENDIX D

PRO FORMA FINANCIAL PROJECTIONS

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D-1 [THIS PAGE INTENTIONALLY LEFT BLANK]

APPENDIX E

HISTORICAL FINANCIAL STATEMENT

attached [THIS PAGE INTENTIONALLY LEFT BLANK] Cove at NOLA LLC Budget Comparison December 31, 2016

Annual Month Ending 12/31/2016 Year to Date 12/31/2016 12/31/2016 Actual Budget Variance % Actual Budget Variance % Budget Physical Occupancy % 96.4 % 94.0 % 2.4 % 2.55 94.8 % 95.2 % (0.4) % (0.45) 95.2 % Total Income

Rental Income 411105 - Market Rent 234,960.00 234,960.00 0.00 0.00 2,819,520.00 2,819,520.00 0.00 0.00 2,819,520.00 411110 - Gain (Loss) To Lease 4,357.35 (2,000.00) 6,357.35 317.86 10,058.47 (53,861.00) 63,919.47 118.67 (53,861.00) 411210 - Bad Debt - Skips and Evicts (3,718.98) (3,623.00) (95.98) (2.64) (40,052.80) (43,573.00) 3,520.20 8.07 (43,573.00) 411215 - Bad Debt Collected 770.49 580.00 190.49 32.84 7,447.45 6,995.00 452.45 6.46 6,995.00 411220 - Month To Month Fees 32.26 330.00 (297.74) (90.22) 6,395.80 4,773.00 1,622.80 33.99 4,773.00 Total Rental Income 236,401.12 230,247.00 6,154.12 2.67 2,803,368.92 2,733,854.00 69,514.92 2.54 2,733,854.00

Vacancy, Losses & Concessions 411225 - Non Revenue Units - Models (3,955.00) (3,060.00) (895.00) (29.24) (47,113.23) (36,720.00) (10,393.23) (28.30) (36,720.00) 411230 - Concessions (1,770.00) (1,774.00) 4.00 0.22 (28,187.99) (20,867.00) (7,320.99) (35.08) (20,867.00) 411240 - Physical Vacancy Loss (8,482.96) (14,098.00) 5,615.04 39.82 (147,936.65) (134,513.00) (13,423.65) (9.97) (134,513.00) Total Vacancy, Losses & Concessions (14,207.96) (18,932.00) 4,724.04 24.95 (223,237.87) (192,100.00) (31,137.87) (16.20) (192,100.00)

Net Rental Income 222,193.16 211,315.00 10,878.16 5.14 2,580,131.05 2,541,754.00 38,377.05 1.50 2,541,754.00 E-1 Other Income 421105 - Application Fees 1,785.00 897.00 888.00 98.99 11,190.00 11,034.00 156.00 1.41 11,034.00 421106 - Qualifying Fee 2,525.00 150.00 2,375.00 1,583.33 15,475.00 600.00 14,875.00 2,479.16 600.00 421107 - Cleaning Fees 50.00 200.00 (150.00) (75.00) 2,673.38 3,674.00 (1,000.62) (27.23) 3,674.00 421112 - Damages 625.00 377.00 248.00 65.78 8,249.14 8,080.00 169.14 2.09 8,080.00 421115 - Forfeited Deposits 0.00 850.00 (850.00) (100.00) 0.00 10,600.00 (10,600.00) (100.00) 10,600.00 421117 - Key/Lock Change 100.00 95.00 5.00 5.26 1,210.00 1,140.00 70.00 6.14 1,140.00 421120 - Late Fees 5,426.23 2,250.00 3,176.23 141.16 47,776.31 28,025.00 19,751.31 70.47 28,025.00 421125 - NSF Charges 75.00 95.00 (20.00) (21.05) 800.00 1,140.00 (340.00) (29.82) 1,140.00 421126 - Convenience Fee Income 22.00 180.00 (158.00) (87.77) 1,110.00 2,085.00 (975.00) (46.76) 2,085.00 421135 - Notice/Term Fees 384.35 1,475.00 (1,090.65) (73.94) 18,619.07 13,275.00 5,344.07 40.25 13,275.00 421140 - Admin/Legal Fees 555.00 310.00 245.00 79.03 4,285.00 3,790.00 495.00 13.06 3,790.00 421150 - Pet Fees/Rent 309.68 275.00 34.68 12.61 4,209.68 3,375.00 834.68 24.73 3,375.00 421250 - Miscellaneous Income 0.00 0.00 0.00 0.00 370.00 0.00 370.00 0.00 0.00 421305 - Util Reimb - Electric 234.32 0.00 234.32 0.00 2,421.54 0.00 2,421.54 0.00 0.00 421315 - Util Reimb - Trash 353.90 321.00 32.90 10.24 3,647.57 2,114.00 1,533.57 72.54 2,114.00 421320 - Util Reimb - Water 2,584.84 2,455.00 129.84 5.28 31,263.12 28,634.00 2,629.12 9.18 28,634.00 Total Other Income 15,030.32 9,930.00 5,100.32 51.36 153,299.81 117,566.00 35,733.81 30.39 117,566.00

Financial Income 421210 - Interest Income 0.00 0.00 0.00 0.00 76.99 0.00 76.99 0.00 0.00 Total Financial Income 0.00 0.00 0.00 0.00 76.99 0.00 76.99 0.00 0.00

Service Related Income 421205 - Cable Income 5,065.15 1,400.00 3,665.15 261.79 36,614.46 16,800.00 19,814.46 117.94 16,800.00 421225 - Laundry Income 569.50 470.00 99.50 21.17 6,048.37 6,940.00 (891.63) (12.84) 6,940.00 421245 - Vending Income 71.00 0.00 71.00 0.00 1,071.08 0.00 1,071.08 0.00 0.00

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Annual Month Ending 12/31/2016 Year to Date 12/31/2016 12/31/2016 Actual Budget Variance % Actual Budget Variance % Budget Total Service Related Income 5,705.65 1,870.00 3,835.65 205.11 43,733.91 23,740.00 19,993.91 84.22 23,740.00

Total Income 242,929.13 223,115.00 19,814.13 8.88 2,777,241.76 2,683,060.00 94,181.76 3.51 2,683,060.00

Total Expenses

Management Fees 511105 - Management Fee 7,069.40 6,693.00 (376.40) (5.62) 82,383.55 80,489.00 (1,894.55) (2.35) 80,489.00 Total Management Fees 7,069.40 6,693.00 (376.40) (5.62) 82,383.55 80,489.00 (1,894.55) (2.35) 80,489.00

Marketing Expenses 512105 - Advertising - Internet 854.97 1,875.00 1,020.03 54.40 12,680.08 22,500.00 9,819.92 43.64 22,500.00 512120 - Marketing Supplies 336.40 321.00 (15.40) (4.79) 3,395.66 3,852.00 456.34 11.84 3,852.00 512125 - Resident Referrals 0.00 300.00 300.00 100.00 1,300.00 2,700.00 1,400.00 51.85 2,700.00 Total Marketing Expenses 1,191.37 2,496.00 1,304.63 52.26 17,375.74 29,052.00 11,676.26 40.19 29,052.00

Administrative Expenses 512205 - Model/Corporate Unit Costs 0.00 0.00 0.00 0.00 41.96 500.00 458.04 91.60 500.00 E-2 512210 - Credit Reports-Leasing Desk 436.59 427.00 (9.59) (2.24) 5,031.18 5,124.00 92.82 1.81 5,124.00 512220 - Legal - Evictions 2,280.00 700.00 (1,580.00) (225.71) 13,420.00 8,956.00 (4,464.00) (49.84) 8,956.00 512225 - Professional Fees - Legal/Acctg 0.00 0.00 0.00 0.00 688.00 0.00 (688.00) 0.00 0.00 512230 - Resident Relations/Functions 283.04 320.00 36.96 11.55 1,333.70 3,840.00 2,506.30 65.26 3,840.00 512315 - Bank Fees 208.52 130.00 (78.52) (60.40) 2,340.32 1,560.00 (780.32) (50.02) 1,560.00 512316 - Convenience Fee Expense 181.62 325.00 143.38 44.11 2,700.59 3,592.00 891.41 24.81 3,592.00 512320 - Computer-Leasing and Rents 414.79 415.00 0.21 0.05 5,164.02 4,980.00 (184.02) (3.69) 4,980.00 512321 - Computer-Call Center 55.00 705.00 650.00 92.19 1,175.00 8,460.00 7,285.00 86.11 8,460.00 512330 - Contract Printing-Brochures 0.00 0.00 0.00 0.00 602.30 750.00 147.70 19.69 750.00 512350 - Employee Recognition 325.39 0.00 (325.39) 0.00 325.39 0.00 (325.39) 0.00 0.00 512355 - Office Equip Expense 204.25 300.00 95.75 31.91 3,170.59 3,600.00 429.41 11.92 3,600.00 512365 - Hospitality-Office Refreshments 253.83 155.00 (98.83) (63.76) 2,683.81 1,860.00 (823.81) (44.29) 1,860.00 512375 - Leasing Forms 70.00 0.00 (70.00) 0.00 734.00 0.00 (734.00) 0.00 0.00 512415 - Office Supplies 363.05 270.00 (93.05) (34.46) 3,535.16 3,240.00 (295.16) (9.10) 3,240.00 512430 - Postage 138.17 70.00 (68.17) (97.38) 1,140.37 840.00 (300.37) (35.75) 840.00 512440 - Security Monitoring Contract 25.00 0.00 (25.00) 0.00 385.00 300.00 (85.00) (28.33) 300.00 512445 - Technology Support 404.08 540.00 135.92 25.17 6,365.79 6,480.00 114.21 1.76 6,480.00 512450 - Telephone/Internet 1,059.67 710.00 (349.67) (49.24) 10,121.48 8,520.00 (1,601.48) (18.79) 8,520.00 512525 - Mileage 60.08 50.00 (10.08) (20.16) 743.00 600.00 (143.00) (23.83) 600.00 512530 - Parking 11.05 10.00 (1.05) (10.50) 173.35 120.00 (53.35) (44.45) 120.00 512605 - Dues/Memberships 0.00 0.00 0.00 0.00 1,051.50 960.00 (91.50) (9.53) 960.00 512615 - Permits & Licenses 0.00 0.00 0.00 0.00 380.00 1,394.00 1,014.00 72.74 1,394.00 Total Administrative Expenses 6,774.13 5,127.00 (1,647.13) (32.12) 63,306.51 65,676.00 2,369.49 3.60 65,676.00

Payroll & Related 513110 - Salary-Manager 5,538.48 5,426.00 (112.48) (2.07) 48,401.31 48,287.00 (114.31) (0.23) 48,287.00 513111 - Salary-Asst Manager 3,566.68 3,840.00 273.32 7.11 28,188.81 34,140.00 5,951.19 17.43 34,140.00 513112 - Salary-Leasing 3,396.67 2,820.00 (576.67) (20.44) 25,849.82 25,156.00 (693.82) (2.75) 25,156.00

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Annual Month Ending 12/31/2016 Year to Date 12/31/2016 12/31/2016 Actual Budget Variance % Actual Budget Variance % Budget 513120 - Bonus-Management 344.50 1,578.00 1,233.50 78.16 13,618.61 14,106.00 487.39 3.45 14,106.00 513135 - Salary-Maint Supervisor 5,297.40 5,040.00 (257.40) (5.10) 55,315.31 44,800.00 (10,515.31) (23.47) 44,800.00 513137 - Salary-Maintenance 11,492.27 9,480.00 (2,012.27) (21.22) 90,389.54 85,040.00 (5,349.54) (6.29) 85,040.00 513145 - Bonus-Maintenance 67.50 1,400.00 1,332.50 95.17 3,100.68 1,400.00 (1,700.68) (121.47) 1,400.00 513155 - Contract Staff-Maintenance 0.00 0.00 0.00 0.00 615.73 0.00 (615.73) 0.00 0.00 513210 - Employee Recruitment 0.00 0.00 0.00 0.00 582.83 0.00 (582.83) 0.00 0.00 513215 - Group Insurance 2,085.19 2,215.00 129.81 5.86 17,680.51 19,938.00 2,257.49 11.32 19,938.00 513225 - Payroll Processing 1,050.00 1,050.00 0.00 0.00 12,450.00 12,600.00 150.00 1.19 12,600.00 513235 - State Payroll Taxes 2,289.30 3,146.00 856.70 27.23 22,440.01 28,072.00 5,631.99 20.06 28,072.00 513240 - Worker's Comp Insurance 1,435.80 1,129.00 (306.80) (27.17) 14,997.08 11,495.00 (3,502.08) (30.46) 11,495.00 Total Payroll & Related 36,563.79 37,124.00 560.21 1.50 333,630.24 325,034.00 (8,596.24) (2.64) 325,034.00

Utilities 514505 - Cable 95.04 90.00 (5.04) (5.60) 1,263.16 1,080.00 (183.16) (16.95) 1,080.00 514550 - Trash Removal 2,050.00 1,575.00 (475.00) (30.15) 20,760.00 18,900.00 (1,860.00) (9.84) 18,900.00 515105 - Electric - Common Area 2,680.12 2,510.00 (170.12) (6.77) 28,698.75 28,245.00 (453.75) (1.60) 28,245.00 515125 - Electric - Vacants 1,165.37 1,130.00 (35.37) (3.13) 14,275.83 10,805.00 (3,470.83) (32.12) 10,805.00 515150 - Water 11,000.00 9,820.00 (1,180.00) (12.01) 153,807.59 114,525.00 (39,282.59) (34.30) 114,525.00 E-3 515155 - Sewer 15,000.00 13,750.00 (1,250.00) (9.09) 208,550.62 156,670.00 (51,880.62) (33.11) 156,670.00 Total Utilities 31,990.53 28,875.00 (3,115.53) (10.78) 427,355.95 330,225.00 (97,130.95) (29.41) 330,225.00

Maintenance & Repairs 514105 - Apt/Interior Supplies 366.49 150.00 (216.49) (144.32) 3,249.27 1,830.00 (1,419.27) (77.55) 1,830.00 514115 - Carpet Cleaning 1,250.00 1,210.00 (40.00) (3.30) 14,759.85 14,900.00 140.15 0.94 14,900.00 514120 - Electrical Supplies-Apts 136.63 125.00 (11.63) (9.30) 2,898.27 2,400.00 (498.27) (20.76) 2,400.00 514130 - Interior Painting-Contract 125.00 530.00 405.00 76.41 8,000.00 6,530.00 (1,470.00) (22.51) 6,530.00 514135 - Interior Resurfacing 270.00 400.00 130.00 32.50 4,110.00 4,915.00 805.00 16.37 4,915.00 514140 - Maid Service-Contract 0.00 0.00 0.00 0.00 875.00 0.00 (875.00) 0.00 0.00 514145 - Paint Supplies-Apts 901.06 490.00 (411.06) (83.88) 8,968.26 6,050.00 (2,918.26) (48.23) 6,050.00 514150 - Plumbing/Electrical Repairs 1,259.00 755.00 (504.00) (66.75) 9,254.22 9,200.00 (54.22) (0.58) 9,200.00 514155 - Plumbing Supplies-Apts 279.45 700.00 420.55 60.07 5,590.65 7,496.00 1,905.35 25.41 7,496.00 514160 - Window Coverings 0.00 281.00 281.00 100.00 303.94 3,410.00 3,106.06 91.08 3,410.00 514220 - Entry Access/Gates 0.00 200.00 200.00 100.00 3,445.66 4,100.00 654.34 15.95 4,100.00 514230 - Fire Safety 80.00 300.00 220.00 73.33 896.43 6,860.00 5,963.57 86.93 6,860.00 514240 - Interior Common Area 0.00 0.00 0.00 0.00 67.41 0.00 (67.41) 0.00 0.00 514247 - Pool Contract 160.00 0.00 (160.00) 0.00 3,003.83 0.00 (3,003.83) 0.00 0.00 514248 - Pool Supplies/Repairs 0.00 150.00 150.00 100.00 3,635.32 3,500.00 (135.32) (3.86) 3,500.00 514260 - Signage 100.00 0.00 (100.00) 0.00 1,239.37 1,200.00 (39.37) (3.28) 1,200.00 514305 - Appliance Parts 170.74 95.00 (75.74) (79.72) 2,422.10 1,370.00 (1,052.10) (76.79) 1,370.00 514310 - Auto/Golf Cart Expense 0.00 0.00 0.00 0.00 907.40 0.00 (907.40) 0.00 0.00 514320 - Building Exteriors 0.00 0.00 0.00 0.00 0.00 400.00 400.00 100.00 400.00 514322 - Carpet - Water Extraction 0.00 195.00 195.00 100.00 781.88 2,340.00 1,558.12 66.58 2,340.00 514325 - Ceiling Fans 0.00 0.00 0.00 0.00 88.61 0.00 (88.61) 0.00 0.00 514335 - Contract Labor 0.00 1,875.00 1,875.00 100.00 1,745.68 11,500.00 9,754.32 84.82 11,500.00 514345 - Equipment Repairs 0.00 0.00 0.00 0.00 497.73 0.00 (497.73) 0.00 0.00 514352 - Doors Keys Locks 194.16 415.00 220.84 53.21 1,825.02 4,980.00 3,154.98 63.35 4,980.00

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Annual Month Ending 12/31/2016 Year to Date 12/31/2016 12/31/2016 Actual Budget Variance % Actual Budget Variance % Budget 514355 - Glass And Mirror 0.00 0.00 0.00 0.00 84.54 0.00 (84.54) 0.00 0.00 514360 - HVAC Supplies/Repairs 633.93 325.00 (308.93) (95.05) 8,467.73 13,850.00 5,382.27 38.86 13,850.00 514365 - Janitorial Supplies 128.54 315.00 186.46 59.19 4,078.77 3,880.00 (198.77) (5.12) 3,880.00 514390 - Tools 0.00 0.00 0.00 0.00 119.45 0.00 (119.45) 0.00 0.00 514395 - Window Screen Replacement 0.00 0.00 0.00 0.00 136.99 0.00 (136.99) 0.00 0.00 514405 - Grounds Supplies 0.00 0.00 0.00 0.00 1,362.98 300.00 (1,062.98) (354.32) 300.00 514410 - Seasonal Landscaping 0.00 0.00 0.00 0.00 410.15 4,500.00 4,089.85 90.88 4,500.00 514525 - Lawn Maintenance 2,332.08 2,300.00 (32.08) (1.39) 27,952.08 27,600.00 (352.08) (1.27) 27,600.00 514530 - Pest Control 645.71 855.00 209.29 24.47 9,077.36 11,960.00 2,882.64 24.10 11,960.00 514535 - Security Service 0.00 2,100.00 2,100.00 100.00 4,322.63 25,200.00 20,877.37 82.84 25,200.00 514545 - Termite Bonds 240.67 0.00 (240.67) 0.00 3,092.01 2,625.00 (467.01) (17.79) 2,625.00 Total Maintenance & Repairs 9,273.46 13,766.00 4,492.54 32.63 137,670.59 182,896.00 45,225.41 24.72 182,896.00

Taxes & Insurance 621120 - Real Estate Taxes 14,608.83 14,608.83 0.00 0.00 175,305.96 175,305.96 0.00 0.00 175,305.96 711100 - Insurance Expense 10,494.35 12,022.00 1,527.65 12.70 133,720.63 144,264.00 10,543.37 7.30 144,264.00 711135 - Flood Insurance 514.77 4,124.00 3,609.23 87.51 39,938.35 49,488.00 9,549.65 19.29 49,488.00 TotalTaxes&Insurance 25,617.95 30,754.83 5,136.88 16.70 348,964.94 369,057.96 20,093.02 5.44 369,057.96 E-4

TotalOperatingExpenses 118,480.63 124,835.83 6,355.20 5.09 1,410,687.52 1,382,429.96 (28,257.56) (2.04) 1,382,429.96

NOI(Loss) 124,448.50 98,279.17 26,169.33 26.62 1,366,554.24 1,300,630.04 65,924.20 5.06 1,300,630.04

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Annual Month Ending 12/31/2016 Year to Date 12/31/2016 12/31/2016 Actual Budget Variance % Actual Budget Variance % Budget Total Depreciation & Amortization 2,983.33 342,234.00 339,250.67 99.12 35,799.96 375,058.00 339,258.04 90.45 375,058.00

Debt Service 811105 - Mortgage Interest - Note A 43,764.51 44,600.00 835.49 1.87 520,041.63 535,200.00 15,158.37 2.83 535,200.00 Total Debt Service 43,764.51 44,600.00 835.49 1.87 520,041.63 535,200.00 15,158.37 2.83 535,200.00

Other Non-Operating Expenses 912145 - Legal Fees 125.00 0.00 (125.00) 0.00 258.00 500.00 242.00 48.40 500.00 913105 - Insurance Claims 0.00 0.00 0.00 0.00 5,463.50 0.00 (5,463.50) 0.00 0.00 921140 - Asset Management Fee 2,945.58 2,231.00 (714.58) (32.02) 34,326.48 26,831.00 (7,495.48) (27.93) 26,831.00 921145 - Partnership Legal Fees 0.00 0.00 0.00 0.00 1,500.00 0.00 (1,500.00) 0.00 0.00 921155 - Misc Partnership Expense 635.00 635.00 0.00 0.00 7,802.20 7,620.00 (182.20) (2.39) 7,620.00 921160 - Other Professional Fees 480.00 480.00 0.00 0.00 21,145.00 5,760.00 (15,385.00) (267.10) 5,760.00 921165 - Tax Return Preparation 0.00 225.00 225.00 100.00 1,800.00 2,700.00 900.00 33.33 2,700.00 Total Other Non-Operating Expenses 4,185.58 3,571.00 (614.58) (17.21) 72,295.18 43,411.00 (28,884.18) (66.53) 43,411.00

Total Non-Operating Expenses 63,931.90 393,530.00 329,598.10 83.75 857,160.18 1,133,744.00 276,583.82 24.39 1,133,744.00 E-5 Net Income (Loss) 60,516.60 (295,250.83) 355,767.43 120.49 509,394.06 166,886.04 342,508.02 205.23 166,886.04

Renovation 141160 - REN-Plumbing 0.00 0.00 0.00 0.00 333.91 0.00 333.91 0.00 0.00 141185 - REN-Retaining Walls 0.00 0.00 0.00 0.00 350.00 0.00 350.00 0.00 0.00 141195 - REN-Flatwork/Concrete Repairs 0.00 0.00 0.00 0.00 877.00 0.00 877.00 0.00 0.00 141250 - REN-Carpet & Tile 0.00 0.00 0.00 0.00 25,277.54 0.00 25,277.54 0.00 0.00 141255 - REN-Light Fixtures 69.34 0.00 69.34 0.00 891.31 0.00 891.31 0.00 0.00 141260 - REN-Refrigerators 0.00 0.00 0.00 0.00 3,794.28 0.00 3,794.28 0.00 0.00 141265 - REN-Dishwashers 0.00 0.00 0.00 0.00 1,812.82 0.00 1,812.82 0.00 0.00 141275 - REN-Stoves\Hoods 0.00 0.00 0.00 0.00 2,346.55 0.00 2,346.55 0.00 0.00 141290 - REN-Ceiling Fans 0.00 0.00 0.00 0.00 1,327.29 0.00 1,327.29 0.00 0.00 141310 - REN-Interior Upgrades 0.00 0.00 0.00 0.00 9,544.75 0.00 9,544.75 0.00 0.00 141340 - REN-Resurface Counters\Tubs 270.00 0.00 270.00 0.00 8,045.00 0.00 8,045.00 0.00 0.00 141425 - REN-Construction Mgmt Fee 0.00 0.00 0.00 0.00 3,246.23 0.00 3,246.23 0.00 0.00 141430 - REN-Miscellaneous 4,185.90 0.00 4,185.90 0.00 4,185.90 0.00 4,185.90 0.00 0.00

Renovation 4,525.24 0.00 4,525.24 0.00 62,032.58 0.00 62,032.58 0.00 0.00

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APPENDIX F

FORM OF CONTINUING DISCLOSURE AGREEMENT

THIS CONTINUING DISCLOSURE AGREEMENT, dated April ____, 2017 (this “Disclosure Agreement”), is executed and delivered by AVHG Cove, LLC and Invest in America’s Veterans Foundation, Inc. (collectively, the “Obligated Party”) and Disclosure Advisors LLC, as Dissemination Agent (the “Dissemination Agent”), in connection with the issuance by the Louisiana Local Government Environmental Facilities and Community Development Authority (the “Authority”) of its $______Multifamily Housing Revenue Bonds (The Cove at NOLA Apartments), Series 2017A (the “Series 2017A Bonds”) and its $______Multifamily Housing Revenue Bonds (The Cove at NOLA Apartments), Taxable Series 2017B (the “Series 2017B Bonds” or the “Subordinate Bonds” and together with the Series 2017A Bonds, the “Bonds”).

W I T N E S S E T H :

WHEREAS, in connection with the issuance of the Bonds, the Obligated Party has agreed to enter into this Disclosure Agreement to provide certain financial and operating information, as well as notice of the occurrence of certain events, during the life of the Bonds, all in accordance with section (b)(5) of the Rule (as hereinafter defined); and

WHEREAS, the Obligated Party desires to appoint Disclosure Advisors LLC as Dissemination Agent to assist the Obligated Party with carrying out its obligations under this Disclosure Agreement, and Disclosure Advisors LLC is willing to accept such appointment in accordance with the terms hereof.

NOW, THEREFORE, IN CONSIDERATION OF THE COVENANTS AND PROMISES HEREIN CONTAINED, the Obligated Party and the Dissemination Agent agree as follows:

SECTION 1. Purpose of this Disclosure Agreement. This Disclosure Agreement is being executed and delivered by the Obligated Party and the Dissemination Agent for the benefit of the Beneficial Owners of the Bonds and to assist the Participating Underwriter (as defined herein) in complying with the Rule. The Obligated Party represents that it is the only Obligated Person (as defined in the Rule) with respect to the Bonds and that no other person is expected to become an Obligated Person at any time after the issuance of the Bonds.

SECTION 2. Definitions. In addition to the definitions set forth in the Authorizing Instrument (as defined herein), which apply to any capitalized term used in this Disclosure Agreement unless otherwise defined herein, the following capitalized terms shall have the following meanings:

“Annual Financial Information” means the financial information and operating data described in Section 4 and in Exhibit A hereto.

“Annual Report” means the Annual Financial Information and the Audited Financial Statements for any Fiscal Year, as more fully described in Section 4 hereof.

“Annual Reporting Certificate” means the certificate of the Obligated Party with respect to its Annual Report, the form of which is attached hereto as Exhibit B.

“Annual Report Date” means, June 30 of each year.

“Annual Report Disclosure” means the dissemination of the Annual Report as set forth in Section 4 hereof.

“Audited Financial Statements” means the audited financial statements of the Project, prepared pursuant to the standards and as described in Section 4 hereof.

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“Authorizing Instrument” means the Trust Indenture dated as of April 1, 2017 by and between Wilmington Trust, National Association, and Authority, which sets forth the terms of the Bonds.

“Beneficial Owner” means any person who has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, the Bonds (including persons holding such Bonds through nominees, depositories or other such intermediaries).

“Business Day” means any day other than a Saturday, Sunday, legal holiday or a day on which the Dissemination Agent or banking institutions in New York, New York are authorized or required by law to close.

“Commission” means the Securities and Exchange Commission.

“EMMA” means the MSRB’s Electronic Municipal Market Access system for municipal securities disclosure, currently located at http://emma.msrb.org. Until otherwise designated by the MSRB or the Commission, filings with the MSRB are to be made through the EMMA website.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Listed Events” means any of the events with respect to the Bonds described in Section 5(a) hereof.

“Listed Events Disclosure” means dissemination of a notice of the occurrence of a Listed Event as set forth in Section 5 hereof.

“Material” with respect to information, means information as to which a substantial likelihood exists that a reasonably prudent investor would attach importance thereto in deciding to buy or sell a Bond or, if not disclosed, would significantly alter the total information otherwise available to an investor from the offering document related to the Bonds, information disclosed hereunder, or information generally available to the public. Notwithstanding the foregoing, “Material” information includes information that would be deemed “material” for purposes of the purchase or sale of a Bond within the meaning of applicable federal securities laws, as interpreted at the time of discovery of the information.

“MSRB” means the Municipal Securities Rulemaking Board or any other entity designated or authorized by the Commission to receive reports pursuant to the Rule.

“Participating Underwriter” means Stifel, Nicolaus & Company, Inc. and each other broker, dealer or municipal securities dealer acting as an underwriter in any primary offering of the Bonds.

“Prescribed Form” means, with regard to the filing of the Annual Report, each notice of the occurrence of a Listed Event and other notices described herein with the MSRB, such electronic format, accompanied by such identifying information, as shall have been prescribed by the MSRB and which shall be in effect on the date of filing of such information.

“Project” means collectively, The Cove at NOLA Apartments, the acquisition of which was financed with the issuance of the Bonds.

“Rule” means Rule 15c2-12 adopted by the Commission under the Exchange Act, as the same may be amended from time to time.

“State” means the State of Louisiana.

SECTION 3. CUSIP Number/Final Official Statement. The CUSIP Number of the final maturity of the Bonds is ______. The final Official Statement relating to the Bonds is dated ______, 2017 (the “Final Official Statement”).

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SECTION 4. Annual Report Disclosure.

(a) Provision of Annual Report.

(i) On or before each Annual Report Date, the Obligated Party shall provide, or shall cause the Dissemination Agent to provide, to the MSRB, the Annual Report. The Annual Report shall be submitted in Prescribed Form, and it may cross-reference other information as provided in Section 4(b) below. The Audited Financial Statements may be submitted separately from the balance of the Annual Report if not available by the Annual Report Date. The Annual Financial Information need not be separately provided if included in the Audited Financial Statements. The Annual Report shall identify the Bonds by name and CUSIP number.

(ii) Not later than forty-five (45) days prior to each Annual Report Date, the Dissemination Agent shall submit to the Obligated Party the form of Annual Reporting Certificate attached hereto as Exhibit B and shall request that the Obligated Party return the completed certificate along with the Annual Report prior to the date set forth in subsection 4(a)(iii) below.

(iii) Not later than fifteen (15) days prior to the Annual Report Date, the Obligated Party shall provide the Annual Report and the completed Annual Reporting Certificate to the Dissemination Agent. Promptly upon its receipt of the Annual Report, but no later than the Annual Report Date, the Dissemination Agent shall send the Annual Report to the MSRB in Prescribed Form. The Dissemination Agent shall notify the Obligated Party in writing of the date the Dissemination Agent provided the Annual Report to the MSRB.

(iv) If the Dissemination Agent has not received a copy of the Annual Report by the date set forth in subsection (a)(iii) above, the Dissemination Agent shall contact the Obligated Party to determine if the Obligated Party has submitted the Annual Report as required by subsection (a)(i) above. If the Dissemination Agent is unable to verify that the Annual Report has been provided to the MSRB by the Annual Report Date, the Dissemination Agent shall send a notice in a timely manner to the MSRB and the Obligated Party in substantially the form attached as Exhibit C not later than ten (10) days after the Annual Report Date.

(b) Contents of Annual Report.

(i) The Annual Report prepared at the direction of the Obligated Party shall contain (or incorporate by reference as described below) the following: (A) the Audited Financial Statements of the Project for the previous Fiscal Year, prepared in accordance with generally accepted accounting principles; provided that if the Audited Financial Statements of the Project are not available prior to the Annual Report Date, then (I) the Obligated Party shall file, or shall cause the Dissemination Agent to file, unaudited financial statements, if prepared, and (II) the Audited Financial Statements shall be provided to the MSRB when they become available, and (B) the Annual Financial Information specified on Exhibit A hereto for the previous Fiscal Year; provided, however, that to the extent all or portions of the Annual Financial Information are included in the Audited Financial Statements, such information need not be separately provided, but the Obligated Person shall file, or shall cause the Dissemination Agent to file, a notice to such effect to accompany the Audited Financial Statements.

(ii) Any or all of the items listed above may be included by specific reference to other documents, including official statements or prospectuses of debt issues of the Obligated Party or related public entities, which have been previously provided to the MSRB or the Commission. If the document included by reference is a final official statement, it must be available from the MSRB. The Obligated Party shall clearly identify in the Annual Report each such other document so included by reference.

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(iii) If any part of the Annual Report can no longer be generated because the operations to which they are related have been materially changed or discontinued, the Obligated Party will provide notice of the same to the MSRB in Prescribed Form for the year in which such event first occurs.

SECTION 5. Disclosure of Listed Events.

(a) Upon the occurrence of any of the following Listed Events, the Obligated Party (or the Dissemination Agent on behalf of the Obligated Party) shall give notice of the occurrence of such event to the MSRB in accordance with this Section 5:

(i) principal and interest payment delinquencies;

(ii) nonpayment related defaults, if Material;

(iii) unscheduled draws on debt service reserves reflecting financial difficulties;

(iv) unscheduled draws on credit enhancements reflecting financial difficulties;

(v) substitution of credit or liquidity providers, or their failure to perform;

(vi) adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701 TEB) or other material notices or determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds;

(vii) modifications to rights of Bondholders, if Material;

(viii) Bond calls, if Material, and tender offers;

(ix) defeasances;

(x) release, substitution, or sale of property securing repayment of the Bonds, if Material;

(xi) rating changes;

(xii) bankruptcy, insolvency, receivership or similar event of the Obligated Party*;

(xiii) the consummation of a merger, consolidation, or acquisition involving the Obligated Party or the sale of all or substantially all of the assets of the Obligated Party, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if Material; and

(xiv) appointment of a successor or additional Trustee/Paying Agent or the change of name of a Trustee/Paying Agent, if Material.

* For the purposes of the event identified in clause (xii) above, the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for the Obligated Party in a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in which a court or government authority has assumed jurisdiction over substantially all of the assets or business of the Obligated Party, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the Obligated Party.

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Notwithstanding the foregoing: notice of the occurrence of any Listed Event described in (viii) or (ix) above need not be given under this Section 5 any earlier than when notice (if any) of the underlying event is given to the registered owners of the affected Bonds pursuant to the Authorizing Instrument; and notice of any scheduled sinking fund redemption in accordance with the schedule set forth in the Authorizing Instrument or the Final Official Statement need not be given under this Disclosure Agreement.

(b) Within one (1) Business Day of obtaining actual knowledge of the occurrence of a Listed Event, the Dissemination Agent shall contact the Obligated Party, inform such person of the occurrence of such event, and request that the Obligated Party promptly notify the Dissemination Agent in writing whether to report the occurrence of the Listed Event pursuant to subsection 5(f).

(c) When the Obligated Party obtains knowledge of the occurrence of a Listed Event, whether because of a notice from the Dissemination Agent pursuant to subsection 5(b) or otherwise, the Obligated Party shall promptly determine whether notice of such occurrence is required to be disclosed pursuant to the Rule.

(d) If the Obligated Party determines that the occurrence of a Listed Event is required to be disclosed pursuant to the Rule, the Obligated Party shall promptly instruct the Dissemination Agent in writing to report the occurrence pursuant to subsection 5(f).

(e) If, in response to a request from the Dissemination Agent pursuant to subsection 5(b), the Obligated Party determines that the occurrence of a Listed Event is not required to be disclosed pursuant to the Rule, the Obligated Party shall promptly direct the Dissemination Agent in writing not to report the occurrence pursuant to subsection (f).

(f) If the Obligated Party has instructed the Dissemination Agent to report the occurrence of a Listed Event, the Dissemination Agent shall promptly file a notice of such occurrence with the MSRB in Prescribed Form not later than ten (10) Business Days after the occurrence of the Listed Event; provided, however, that the Dissemination Agent shall be allowed a minimum of one (1) Business Day to prepare and file a notice of a Listed Event, which time frame shall be in addition to any time that the Dissemination Agent is waiting on the Obligated Party to provide the Dissemination Agent with the information necessary to fully prepare and complete such notice of a Listed Event.

(g) If the Obligated Party provides the Dissemination Agent with additional information in accordance with Section 9 hereof and directs the Dissemination Agent to deliver such information to the MSRB, the Dissemination Agent shall deliver such information in a timely manner to the MSRB in Prescribed Form.

SECTION 6. Termination of Reporting Obligation. The Obligated Party’s obligations under this Disclosure Agreement shall terminate when the Obligated Party shall have no legal liability for any obligation on or relating to the repayment of the Bonds, including a legal defeasance of the Bonds.

SECTION 7. Dissemination Agent. The Obligated Party has appointed Disclosure Advisors LLC as Dissemination Agent to assist the Obligated Party with carrying out its obligations under this Disclosure Agreement and Disclosure Advisors LLC has accepted its appointment as Dissemination Agent. The Obligated Party may discharge the Dissemination Agent upon 30 days’ written notice to the Dissemination Agent, with or without appointing a successor. The Obligated Party may appoint additional Dissemination Agents without the consent of any existing Dissemination Agent. The Dissemination Agent may resign hereunder upon 30 days’ written notice to the Obligated Party. If at any time during the term of this Disclosure Agreement the Obligated Party has not appointed a Dissemination Agent, then the Obligated Party shall be deemed to be the Dissemination Agent and shall be solely responsible for all obligations hereunder.

The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Agreement. The Dissemination Agent shall not be responsible in any manner for the content of any notice or report

F-5

prepared by the Obligated Party pursuant to this Disclosure Agreement. The Obligated Party agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys’ fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent’s negligence or willful misconduct. The obligations of the Obligated Party under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.

SECTION 8. Amendment or Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Obligated Party and the Dissemination Agent may amend this Disclosure Agreement (and, to the extent that any such amendment does not materially change or increase its obligations hereunder, the Dissemination Agent shall agree to any amendment so requested by the Obligated Party), and any provision of this Disclosure Agreement may be waived, if (a) permitted by the Rule or (b):

(i) The amendment or waiver is made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature or status of the Obligated Party or the type of business conducted;

(ii) This Disclosure Agreement, as amended, or the provision, as waived, would have complied with the requirements of the Rule at the time of the primary offering of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and

(iii) The amendment or waiver either (A) is approved by the Bondholders in the same manner as provided in the Authorizing Instrument for amendments thereto with the consent of Bondholders, or (B) does not, in the opinion of the Dissemination Agent or nationally recognized bond counsel, materially impair the interests of the Bondholders.

Following any amendment or waiver of a provision of this Disclosure Agreement, the Obligated Party shall give notice in the same manner as for the occurrence of a Listed Event under subsection 5(f) and shall include, as applicable, an explanation of the reason for the amendment or waiver and its impact on the type (or in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the Obligated Party in the Annual Report.

SECTION 9. Dissemination of Additional Information. The Obligated Party may disseminate, or may cause the Dissemination Agent to disseminate, additional information with the Annual Report, notice of the occurrence of an event other than a Listed Event, or any other information in addition to that which is required by this Disclosure Agreement by means of dissemination set forth in this Disclosure Agreement or any other means of communication. Such information shall be provided in Prescribed Form. The Obligated Party shall have no obligation under this Disclosure Agreement or the Rule to update such additional information, to include it with any future Annual Report or to provide notice of any future occurrence of such event.

SECTION 10. Default. If the Obligated Party or the Dissemination Agent fails to comply with any provision of this Disclosure Agreement, any Bondholder may seek specific performance by court order to cause the Obligated Party or the Dissemination Agent, as applicable, to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Authorizing Instrument, and the sole remedy under this Disclosure Agreement upon any failure of the Obligated Party or the Dissemination Agent to comply with this Disclosure Agreement shall be an action to compel performance.

SECTION 11. Transmission of Information and Notices. Notwithstanding anything in this Disclosure Agreement to the contrary, unless otherwise required by law, all notices, documents and information provided to the MSRB shall be provided in Prescribed Form. The Dissemination Agent shall determine each year prior to the Annual Report Date whether a change has occurred in the MSRB’s email address or filing procedures and requirements under the Rule or with respect to EMMA.

F-6

SECTION 12. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the Obligated Party, the Dissemination Agent, each Participating Underwriter and the Beneficial Owners of the Bonds, and shall create no rights in any other person or entity.

SECTION 13. Recordkeeping. The Obligated Party and the Dissemination Agent shall maintain records of all Annual Report Disclosures and Listed Event Disclosures, including the content of such disclosures, the names of the entities with whom such disclosure was filed and the date of filing such disclosure. Such records shall be kept for at least five years after the respective dates of such filings.

SECTION 14. Assignment. The Obligated Party shall not transfer its obligations under this Disclosure Agreement unless the transferee agrees to assume all obligations of the Obligated Party under this Disclosure Agreement or to execute a continuing disclosure undertaking under the Rule. Any corporation or association (a) into which the Dissemination Agent is merged or with which it is consolidated, (b) resulting from any merger or consolidation to which the Dissemination Agent is a party, or (c) succeeding to all or substantially all of the corporate trust business of the Dissemination Agent shall be the successor Dissemination Agent without the execution or filing of any document or the taking of any further action.

SECTION 15. Compensation. The Dissemination Agent shall receive the annual Dissemination Agent Fee (as defined and set forth in the Authorizing Instrument); provided, however, that if the Obligated Party has the Dissemination Agent file more than one notice of a Listed Event under Section 5 hereof within a given calendar year or if the Obligated Party has the Dissemination Agent file any additional information under Section 9 hereof in filings that are filed separately from the scheduled filing of the Annual Report or from the notice of a Listed Event, then the Dissemination Agent shall be separately compensated for such additional filings in such amount(s) as the Obligated Party and the Dissemination Agent shall agree.

SECTION 16. Notices. All notices, requests, demands or other communications to or upon the respective parties hereto shall be deemed to have been duly given or made when delivered personally or by mail (including electronic mail) to the party to which such notice, request, demand or other communication is required or permitted to be given or made under this Disclosure Agreement and addressed as set forth below or telecopied to the telecopier number of the recipient, with confirmation of transmission, indicated below:

If to the Obligated Party, at:

2016 AVHG Cove, LLC c/o Invest in America’s Veterans Foundation, Inc. 4820 Leonard Street Cape Coral, FL 33904 Attention: Charles (“Chip”) Cabot Telephone: (203) 939-8679

Invest in America’s Veterans Foundation, Inc. 4820 Leonard Street Cape Coral, FL 33904 Attention: Charles (“Chip”) Cabot Telephone: (203) 939-8679

If to Dissemination Agent, at:

Disclosure Advisors LLC Attention: Benjamin J. Allen 2602 Oakstone Drive Columbus, Ohio 43231 Phone: (614) 423-8155, ext. 100 Fax: (614) 423-8155 email: [email protected]

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SECTION 17. Governing Law. The provisions of this Disclosure Agreement shall be governed by the laws of the State.

SECTION 18. Counterparts. This Disclosure Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

[Remainder of Page Intentionally Left Blank]

F-8

EXECUTED AND DATED on behalf of the Obligated Party and the Dissemination Agent by their duly authorized representatives as of the date first written above.

2016 AVHG COVE, LLC, a Louisiana limited liability company

By: Invest in America’s Veterans Foundation, Inc., a Florida not-for-profit corporation, its Sole Member

By: Name: Ralph A. Santillo Title: President

INVEST IN AMERICA’S VETERANS FOUNDATION, INC., a Florida not-for-profit corporation, its Sole Member

By: Name: Ralph A. Santillo Title: President

[Signature Page to Obligated Party Continuing Disclosure Agreement]

F-9

DISCLOSURE ADVISORS LLC, as Dissemination Agent

By: Name: Benjamin Allen Title: Managing Director

[Signature Page to Obligated Party Continuing Disclosure Agreement]

F-10

EXHIBIT A

CONTENTS OF ANNUAL FINANCIAL INFORMATION

“Annual Financial Information” means updates of the following tabular information contained in the body of the Official Statement, to the extent not otherwise included in the Audited Financial Statements:

To the extent all or portions of the Annual Financial Information are included in the Audited Financial Statements, such information need not be separately provided, but the Obligated Party shall file, or shall cause the Dissemination Agent to file, a notice to such effect to accompany the Audited Financial Statements.

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EXHIBIT B

FORM OF ANNUAL REPORTING CERTIFICATE

DATE:

[Dissemination Agent] ______[Attention: ______]

Re: Louisiana Local Government Environmental Facilities and Community Development Authority Multifamily Housing Revenue Bonds (The Cove at NOLA Apartments Project)

Pursuant to the Continuing Disclosure Agreement, dated , 2017 (the “Disclosure Agreement”), between AVHG Cove, LLC and Invest in America’s Veterans Foundation, Inc. (collectively, the “Obligated Party”) and Disclosure Advisors LLC (the “Dissemination Agent”), the Obligated Party has agreed to provide the Annual Report.

Attached hereto is the Annual Report for the fiscal year ended ______, 20 which includes the Audited Financial Statements of the Project and the financial information and operating data set forth in Appendix A to the Disclosure Agreement.

2016 AVHG COVE, LLC, a Louisiana limited liability company

By: Invest in America’s Veterans Foundation, Inc., a Florida not-for-profit corporation, its Sole Member

By: Name: Ralph A. Santillo Title: President

INVEST IN AMERICA’S VETERANS FOUNDATION, INC., a Florida not-for-profit corporation, its Sole Member

By: Name: Ralph A. Santillo Title: President

F-12

EXHIBIT C

NOTICE OF FAILURE TO FILE ANNUAL REPORT

Name of Obligated Party: [Obligated Party]

Name of Bond Issue: ______Bonds, Series ______

Date of Issuance: , 20___

BASE CUSIP:

NOTICE IS HEREBY GIVEN that the Obligated Party has not provided the Annual Report with respect to the above-named Bonds as required by the Continuing Disclosure Agreement relating to such Bonds, between the Obligated Party and the Dissemination Agent, and Rule 15c2-12(b)(5) promulgated by the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended. The Obligated Party anticipates that the Annual Report will be filed by .

Dated:

[Dissemination Agent], on behalf of the Obligated Party

By: Its:

cc: [Obligated Party]

F-13 [THIS PAGE INTENTIONALLY LEFT BLANK]

APPENDIX G

APPRAISAL

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[THIS PAGE INTENTIONALLY LEFT BLANK]

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EXHIBIT~A"

(Legal Description of the ULand")

PARCELNO.!

One (I) Certain Grove or Portion of Ground, situated in Secrion 7 of the New Orleans Lakeshore Land Company Subdivision, Third District, City of New Orleans, State of Louisiana. being known as Grove I and described in accordance with Sheriff's Deed dated December II, 1978, recorded in Book 756, Page 511 of the Conveyance Records of Orleans Parish, Louisiana, and also described in accordance with a survey of Harris and Varisco dated March 24, 1981, according to which srud property is designated as Parcel No. 1 in which survey said property is more fully described as follows, to wit:

Commencing at the intersection of Lacombe Road and Curran Boulevard (formerly Curran Road) proceed along Lacombe Road N 31 degrees 28' 47" W, a distance of 642.91 ' the point of beginning; thence S 58 degrees 59' 57" W, a distance of 625.02 feet to a point and corner, thence N 28 degrees 58' 01" W, adi stance of 224.25 feet to a point and comer; thence N 61 degrees 01' 53" E a distance of 615.77 feet to a point on Lacombe Slreet (fonnerly Farrar Road); thence S 3 1degre es 28' 47" E, adi stance of 202,28 feet to the aforesaid point of beginning.

PARCEL NO. 2

All that Piece or Portion of Ground, situated in Section 7 of the New Orleans Lakeshore Land Company Subdivision, Third District, City of New Orleans, State of Louisiana, being known as a portion of Grove Six (6), and being more funy described in accordanct: with a survey of J.J. Krebs and Sons, Inc., dated February 5, 1974, and revised May 16, 1975, and also described ill accordance with a survey by Harris and Varisco dated March24, 1981, according 10 which said property is designated as Parcel No.2, in which sWYey said property is more full y described as foll ows, to-wit:

Commencing at the interseclion of Lacombe Street (formerly Farrar Road) and Curran Boulevard ([omlerly Curran Road), tbe point and place of beginning; thence measure along Curran Boulevard, S 59 degrees 00' 41" W, a distance of 601.32 feet (601.92 feet per title) to a point and corner; thence proceed N 28 degrees 58' 01" W, a distance of 432.29 feet to a point and corner; lhence proceed N 61 degrees 01' 53" E, a distance of582.92 feet to a point and corner on Lacombe Street (fonnerly Farrar Road); thence proceed along Lacombe Street (formerly Farrar Road) S 31 degrees 28' 47" E, adi slance of 411.49 feet to the poinl of beginning.

PARCEL NO. 3

All thai Pi ece or Portion of Ground, situated in Section 7 of the New Orleans Lakeshore Land Company Subdivision, Third District, City of New Orleans, State of Louisiana, being a portion of Groves 6 and 1, and being more fully described in accordance with a survey by 1.J.Krebs and Sons, Inc., dated February 5, 1974, and revised May 16, 1975, a copy of which is annexed to a sale subject to a mortgage recorded in Book 729.fol10 388, of the conveyance records of Orleans Parish, Louisiana, and also described in accordance with a survey by Harris and Varisco dated March 24, 1981, according to whicb said property is designated as Parcel No.3, in which survey sald property is more fully described as follows, to-wit:

Commencing at the intersection of Farrar and C urran Roads (now Lacombe Street and Curran Boulevard, re.spectively). proceed along Lacombe Street, N 31 degrees 28' 47" W, a distance of 411.49 feet to the point of beginning; thence proceed S 61 degrees 01' 53" W, a distance of 582.92 feet to a point and comer; thence proceed N 28 degrees 58' OT' W, tl distance of 192.86 feel to a point and corner; tbence proceed N 58 degrees 59' 57" E (N 58 degrees 59' 53" E per title), a distance of 573.93 feet (635.02 feet per title) to a point and comer; thence proceed S 3 1 degrees 28' 47" E, a di stance of231.42 feet to the point of beginning.

Improvements thereon bear Municipal No. 10501 Curran Boulevard, New Orleans.. Louisiana.

This sale is made subj ect to the following:

I. Taxes and assessments for the year 2014 and subsequent years, oat yet due and payable. 2. COB 699, folio 122 - Restrictive Covenants contained in Act of Sale by LaKratt Corp. to Michael Gabriel, Jr., dated and recorded December 30. 1965, including but not necessarily limited to a prohibition again.st the use of the land for a shopping center or its sale to any major department store or any national drug, variety or food chain. 3. COB 776, folio 49 - Right of Way Easement from Pirogue Cove Apartments, a Partnership in Commendam, to South Ceotral Bell Telephone Company, dated August 20, 1981, recorded on August 21, 198 1. 4. COB 778-G, folio 130 - Servitude Agreement for underground electric service in favor of New Orleans Public Service, Inc., dated June 15, 1982, recorded on June 18, 1982. 5. CIN 4893318, NA 2011-04110 - Grant of Easement by Pirogue Cove at Curran Boulevard, LLC and Cox Communications Louisiana, LLC, dated March 24, 2010, recorded January 27, 2011 in the Conveyance OtIice in the Parish of Orleans. 6. The following matters disclosed by an ALTAlACSM survey made by Dading, Marques and Associates, LLC on November 7, 2013, last revised December _ , 2013, designated Job No. 50335: a. Chain liuk fence runs parallel to the westerly record boundary line. b. Chain link fence a t northwesterly record line encroaches on abutter to the north up to 0. 70 feet.

c. Chain link fence at northwesterly record line encroaches on abuuer to the north up to 0.30 feet. 7. Mongage, Assignment of Leases and Rents and Security Agreement and Fixture Filing made by Strategic Realty Capital, LLC to Grey$tone Servicing Corporation, Inc., a Georgia corporation. in the original principal amount of 59,900,000.00, dated December -' 20 13, recorded December _ , 2013 in the Mortgage Office for Orleans Parish under NA • MIN,..,.-----,-c-" 8. Assignment of Leases and Rents made by Strategic Realty Capital, LLC to OreystoDe Servicing Corporation.lnc., a Georgia corporation, dated December _ _ ,2013, recorded December ~ 2013 in the Mortgage Office for Orleans Parish under NA ~~~_~.MIN_~~_ 9. UCC Financing Statement from Strategic Realty Capital, LLC, as debtor, in favor of Greystone Servicing CoIporatioD, Inc., a Georgia cozporation, as Secured party, fil ed on December _, 2013 under Instrument Number _ _ _ _ _

An according to the survey by Dading, Marques & Associates, LLC, dated November?, 2013 and last revised on December 17, 2013, attached hereto and made a part hereof.

ADDENDUM B

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA Page 1 0125 0612712016 9:32:10AM RENT ROLL DETAIL

As 01 0612512016

Parameter!! : Property - ALL: SubJoumal - ALL: Formers excluded - Yes : Unrt Designation ALL;

~tai l s

Unit Other UniULease Move-In Lease Lease Market Trans Lease Total Oep Balance ~signalion Charges! Unit Floorplan 11 npnly) SQFT Status ,.~ Move.Qut '"rt '"' + Addl. ''''''' Rom Credits Billing On Hand

~".., 0310 112016 0212612017

~".., Davis.Artisha 0210112016

~".., Pral.... Cryslat)'n 0211712016

~".., Ford. Khalifah 0211712016 ,,"00 (9_71)

~".., ~-, 0410112016

~".., 02/0512016 OccupOld.NTV -.. 0310512016 08131/2016 (640.00) 73.38 '" ~".., Salete. Simone 0512112016

~".., Bu!ler, Doran 0711112015

P""dingreoowal Bll!ler,Doran 07111/2014 07111/2016 07/1012017 TRASHREIMB

Occupied ArlIhon ~ Sr. 04/0112016 03131/2017

Occupied Williams. Paula 0612712015 0410 112016 03/31/2017 79500

TRASHREIMB 0.00

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA Page 2 0125 0612712016 9:32:10AM RENT ROLL DETAIL

As 01 0612512016

Parameter!!: Property - ALL: SubJoumal - ALL: Formers e xcluded -Yes: Unrt Designation ALL;

~tai l s

Oc:cupied.NTVl. G;';ens. Felicia 0210112016 0713112016 (0.69)

Ajlpticant Cha

Reese. Brian 1110112015 1013112016 ~"""

Devlin. Keith O!ilO 112016 ","00 ~"""

Ajlpt>cant Williams 0710812016

Eure. Stephanie 1210112015 11 13012016 ~"""

Matthews. 0dee<1 1210112015 ~"""

Kellup . Chery1 0710112015 ~""" TRASHREIMB

Pending renewal Kellup . Chery! 0511512010 0710112016 06l30I2017

0.00 -

Pending Traylor. Denisha 0710112016 0.00 -

Schmidt. Corey 081 1512015 ~"""

0211512016 ",00 ~""" Slaten.Shanel'" 000

Roberts. Crystal 0810112015 ~"""

Ster1ing. Rosenell 0311112016 (675.00) ~""" TRASHREIMB

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA Page J 0125 0612712016 9:32:10AM RENT ROLL DETAIL mgt-521-OO3

As 01 0612512016

Parameter!! : Property - ALL: SubJoumal - ALL: Formers excluded - Yes: Unrt Designation ALL;

~tai l s

Unit Other UniULease Move-In Lease Lease Market Trans Lease Total Oep Balance ~s i gnalion Charges! Unit Floorplan 11 npnly) SQFT Status ,.~ Move.Qut '"rt '"' + Add!. ''''''' Rom Credits Billing On Hand

~".., 051 1312016

~".., Johnson. Victoria 0410112016

~".., Lewis, Debbie 011 1612016 1213112016

~".., Clifton. Chelsea 1211112015 1213112016 ","00

~".., Colin • • Kerona 1m1l2015

Applicant Boiton. C... ra 0710212016 70600 •

~".., Hingle. Nathan 0810112015

~".., Shields, Katrina 1210112015

~".., Stone,W"''''Y 0410112016 09l30I2016 TRASHREtMB OJIO

~".., Datto,,, Cynthia ()4/17I2014 0411712016 03/3112017

~".., (lamer.Michaet 0810112015

Occupied-NTV Randolph. Dnae 1110112014

TRASHREtMB

761_64 ~".., Lewis. Kyle ()4/1212016 041 1212016 0313112017

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA Page 4 of25 0612712016 9:32:10AM RENT ROLL DETAIL

As of 0612512016

Parameter!!: Property - ALL: SubJoumal - ALL: Formers e xcluded -Yes: Unrt Designation ALL;

~tai l s

000

Occupied Holmes. V.c:totia TRASHREIMB

0" Occupied Fowter. Jooatr.an 1212212015 0" Occupied Jones. Rynell 0310112016 (5.00)

Occupied Mi ley. Nikki 0610 112015 0713112016

'" TRASHREIMB

Pooding renewal Miley. Nikki TRASHREIMB

Occupied Ross. l)eOUlnne 000

Celestine

Occupied Alben, Troy 05A1812015 05I08I2016 ll,u712016 TRASHREIMB 0.00

Occupied Wise. Robel! 05.11812015 0510812016 ll,u712016

Occupied Mercadel.Arieile 0511812015 051 1812015 0511412016 10000 600.00 1.030.26

0'" WATERREIMB 0.00 '''' Occupjed Marshall. Joosr.a OOJ2712014 0612712015 0612612016

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA PageS of 25 0612712016 9:32:10AM RENT ROLL DETAIL

As of 0612512016 Parameter!!: Property - ALL: SubJoumal - ALL: Formers excluded - Yes: Unrt Designation ALL;

~tai l s

Unit Other UniULease Move-In Lease Lease Market Trans Lease Total Oep Balance ~s i gnalion Charges! Unit Floorplan 11 npnly) SQFT Status Move.Qut '"rt '"' + Addl. ''''''' Rom Credits Billing On Hand TRASHREIMB 0.00

Pending reoowal Marshatl. Joosha OOJ2712014 0612712016 0612612017

TRASHREIMB

~.., DoIis. Gerard 0112612016 0113112017 9900 (15.39)

~.., Brack. B...... oon 051 1612016 (5.29)

~.., Smilh. Lola 1210812015 12/3112016 ,,"00

~.., l.aren.AIlhea 0211112016

~.., 0alis.Tr...... 0611112016

~.., Parga. Zachary 01l(l412016 01JU3I2017

~.., Harris. Leron 011 1512016

~.., Hampton 1111012015 (25.00) Way""

~.., lorizo. Tyisha 0312112015 031 1512016 0813112016

0.00

Oocupied Garr.O·Avooni 0110612016 01JU5I2017

Oocupied Copetin.Joseph

Oocupied WUliams. Isabel 0610112015 0713112016

Pendingreoowal Williams. Isabel 0810112014 0610112016 0713112017

TRASHREIMB

." Oocupied Brock, Sa""I"" 10/1212012 1110112015 1013112016

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA Page 7 0125 0612712016 9:32:10AM RENT ROLL DETAIL

As 01 0612512016 Parameter!!: Property - ALL: SubJoumal - ALL: Formers excluded - Yes : Unrt Designation ALL;

~tai l s

~".., Handy ()9J1912014 ()9J 1912015 EdmoniQoo

~.., WUllams. Shir\e~ 051 1312016 (0.97)

~".., Mosley. wanda G411112016 (1.67)

TRASHREIMB

l\Wicanl RiIe ~ . Erica 0710112016 Oocupied Roobleau. Jamar 0612012016

TRASHREIMB

~".., Clarl<. MOc:heal 0511012013 0610112016 0513112017 64000 (50.00) TRASHREIMB

OocupOed.NTVI.. 12126J2015

""- ~,~ 0711412016 ~.., Hunter. Willie 0210112016

~".., Fl"llzier.M>chae1 01126J2016

~.., Parker. Giboney 081 1912015

TRASHREIMB

Occup;oo·NTV Sleve<1SM 0711512015 0711412016

~".., Abram. Lamonica 0910112015 0.00

~".., Hughe •. Joshua 041 1012016

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA Page 8 0125 0612712016 9:32:10AM RENT ROLL DETAIL

As 01 0612512016

Parameter!! : Property - ALL: SubJoumal - ALL: Formers excluded - Yes: Unrt Designation ALL;

~tai l s

Unit Other UniULease Move-In Lease Lease Market Trans Lease Total Oep Balance ~s i gnalion Charges! Unit Floorplan 11 npnly) SQFT Status ,.~ Move.Qut '"rt '"' + Addl. ''''''' Rom Credits Billing On Hand TRASHREIMB 0.00

~.., Lee. Eath 0410112016 0)13112017

~.., Granier. Elijah 0512412016

~.., James. Russell 0310 112016 000

~.., Galloway 041 151"2016 78600

~.., Rose.AIIooeisha 1110112015

~.., 0910112015 0813112016 Samalha

Pooding reoowal Thomas 0910112016 0813112017

0.00 -

Oocupied Ho

TRASHREIMB

Pending reoowal Honon. Sharlolte ()M) 112014 0810112016 0713112017

TRASHREIMB

Oocupied Isidore. Ann

Oocupied Holmes. Mel

Oocupied Frank. DeYonsha 011 1812016 0113112017 (0.50)

Oocupied Killough-N,...,ls 0410 112016 09l30I2016

Oocupied.NTV Parms. KlWin

0.00

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA Page 9 0125 0612712016 9:32:10AM RENT ROLL DETAIL mgt-521-OO3

As 01 0612512016

Parameter!!: Property - ALL: SubJoumal - ALL: Formers excluded - Yes : Unrt Designation ALL;

~tai l s

Unit Other UniULease Move-In Lease Lease Market Trans Lease Total Oep Balance ~signalion Charges! Unit Floorplan 11 npnly) SQFT Status ,.~ Move.Qut '"rt '"' + Add!. ''''''' Rom Credits Billing On Hand casey. Selena 031 1512016 0212612017 ~""" 0.00

McMo

Ross. Constance 0510112016 ~"""

JohrlSOl"l.l1lrany 0310112016 ~"""

Smilh. MicMeI 1211712015 (790.00) (10.00) ~"""

Earl)'. Debra 1110112015 1013112016 ~"""

Veal. Michael 0410112016 09l30I2016 ~"""

Dorsey. Jeremy 0910812015 ~"""

Cobb. Dania 0610112016 (660.00) ~"""

Simpson 0410112016 ~""" Kenyalta ~.., -- 1111012015 OccupieO.NTV Beard. Jam... 0810112015 0713112016

0610112016 0513112017 ~""" JorOan.J"""ika

Wheeler. Joseph 0810112015 (610.00) ~""" TRASHR EIM B 000 ,.00

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA Page 10 0125 0612712016 9:32:10AM RENT ROLL DETAIL mgt-521-OO3

As of 0612512016 Parameter!!: Property - ALL: SubJoumal - ALL: Formers excluded - Yes: Unrt Designation ALL;

~ta il s

Unit Other UniULease Move-In Lease Lease Market Trans Lease Total Oep Balance ~signalion Charges! Unit Floorplan nnQnlyl SQFT Status Move.Qut '"rt '"' + Addl. ''''''' Rom Credits Billing On Hand P""ding renewal Wheeler. Joseph 0810112016 0713112017 TRASHREIMB 0.00 -

OoctJpied Christopher

~.., Scolt.Tomolhy ()411812014 041 1812016 1013112016

~".., Barley. Ta>s<.M 0110112016

~".., Marshall.Fortica 0610112016 (50.00)

~".., Duplessie. Beryl 0910112015 0813112016

~".., Cole. Reg,,,,, 0210112016 1.258.00

~".., Brown. Tymne 0512512016 (10.64)

Kathmann, Marie 0612512016 (2.00) ~'"" ~".., Elliott. Det>bie 0512212016 000

~".., Williams. Angel 1212112015 12/3112016

~".., Washlr>gtM. 0512712016 ~.., -""""'" 1112412015

0313112017 ~".., '00_ ~'"

~".., ()412212016 0412212016 0313112017 -.. ,

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove a t N OLA Paoge 11 0125 0612712016 9:32:10AM RENT ROLL DETAIL mgt-521..()(J3

As of 0612512016

Parameter!!: Property - ALL: SubJoumal - ALL: Formers excluded - Yes: Unrt Designation ALL;

~ta il s

Unit Other UniULease Move-In Lease Lease Market Trans Lease Total Oep Balance ~s i gnalion Charges! Un it Floorplan SQFT Status ,.~ Move.Qut + Addl. Rom Billing On Hand nnQnlyl '"rt '"' ''''''' Credits ~.., -"" 0910 112015 65200 0'"

Oocupied While. Selica

Oocupied Benooll. Ira TRASHREtMB 0.00 ""'"

Pooding re.....wal Benoo~ . 1m ()9,ul/2013 0910112016 0813112017

Oocupied Crall. Bmnd)' OW1/2015 0510112016 1013112016

0,'"

Oocupied Gameau. Brad

Oocupied Boykin. Gabriele (0.1 0)

Oocupied oatis. Nicole (0.67) 0'"

Oocupied Ridle~ . Mitton

Oocupied Ange l el ~. Gat>riet 65000 0'" 0'"

Oocupied Mason. N;oole

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA Page 12 0125 0612712016 9:32:10AM RENT ROLL DETAIL mgt-521-OO3

As of 0612512016

Parameter!!: Property - ALL: SubJoumal - ALL: Formers e xcluded - Yes: Unrt Designation ALL;

~ta il s

Unit UniULease Move-In Lease Lease Market Trans ~signaliDn Unit Floorplan SQFT Status ,.~ Move.Qut + Addl. nnQnlyl '"rt '"' ''''''' Butler. Sarah 0711512011 0810112015 0713112016 ~"""

varma •. Miohele 1010112015 ~"""

Pieey 0610112016 ~""" 0513112017

James. Clara 0212312016 0713112016 ~"""

OorupOed Dotsey. Patricia

OorupOed Topps. lIactle

Ross. Bennett ()9J1512009 1010112015 ~""" 09l30I2016

Awlialnt Mccoy. Ladariu. 0710112016 CUm •. Geor9" 1010112015 ~"""

Basketl Carmen 051 1312016 1.00000 1.W9.90 ~"""

~.., Roo"""",·Ross. 0410112016

Stewal1 0210112016 ~""" Chri.topher

Joo!an.Wash 0210112016 0113112017 61500 62500 0" ~""" 000

Boudreaw<. Cm. 1210112015 ow ~"""

Legeaux 0310112016 ~""" "''''''''

Or.eSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA Page 130f 25 0612712016 9:32:1 0AM RENT ROLL DETAIL mgt-521-OO3

As of 0612512016

Parameter!!: Property - ALL: SubJoumal - ALL : Formers excluded - Yes: Unrt Designation ALL;

~ta il s

Unit Other UniULease Move-In Lease Lease Market Trans Lease Total Do, Balance ~signalion Charges! Unit Floorplan SQFT Status Move.Qut + Addl. Rom Billing On Hand nnQnlyl '"rt '"' ''''''' Credits

Pendi"9 Gnffin. Jessica 1.000.00 •

TRASHREIMB

OoctJpied Amison , Apri l OMlll2015 0310112016 0212812017 61000

000 12 00

OoctJpied Sims, Michele O!ilO5I2016

OoctJpied Hay ...... calvin O!ilO1I2016

OoctJpied Allen, Au," 1 0610112015 07131/2016

0.00

Pending renewal Allen, Au,",1 0613012012 0610 112016 01/31/2017

TRASHREIMB

~.., Williams. Alicia 0212412016

10.00

~.., Massey. Phi~p 0310112016

~.., S~rguS . K,,"Mwn 021 1012016

Occupied.NTV Lewis. Krishon 081 1512015

~.., Butler, Dwayne O!ilO1I2016 0413012017

~.., Thomas. Matthew 061 1912015

Pending renewal Thomas. Matthew 0710 112016

~.., Smilh, Wanda 121 1212015 12131/2016 (5.00) '" ''''' 000

OneSite Rents v3.0 Strategic Realty Capital -The Cove at NOLA Page 14 0125 0612712016 9:32:10AM RENT ROLL DETAIL

As of 0612512016

Parameter!!: Property - ALL: SubJoumal - ALL: Formers excluded - Yes: Unrt Designation ALL;

~tai l s

Unit Other UniULease Move-In Lease Lease Market Trans Le ase Total Oep Balance ~signalion Charges! Unit Floorplan 11 npnly) SQFT Status Move.Qut '"rt '"' + Addl. ''''''' Rom Credits Billing On Hand P""ding renewal Smith. War>da 0.00 -

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0312712015 0312912016 0312812017 Christophe,

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~..., RatUer. Cyn!hia 0810 112015 ow

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Oocupied.NlVl. GnTlln. Jes$ic8 0710112015

TRASHREIMB 0.00

Appt;ca"t Yoo"ll.AngeI 0711212016 ow

~.., Jones. Marilyn 10/0112015

~..., G.....,ning.Karen 03/0112016 10.00

Appt;ca"t 06I30J2016 87000 - Leonard

~..., Sims. Samuel 1110112015 ow