working together to build strong communitiesedinburgh house lp -p.43 c. mhp edh, inc. – acceptance...

12200 Tech Road, Suite 250, Silver Spring, MD 20904 Phone: 301-622-2400 Fax: 301-622-2800

BOARD MEETING NOTICE Date: Wednesday, April 27, 2011

Time: 6:30 p.m. Board Meeting Place: Pembridge Community Center **

2315 Blueridge Avenue Wheaton, MD

RSVP: Please call Michael Scheidt at 301-622-2400, ext. 10

FINAL AGENDA 6:30 I. INFORMATION EXCHANGE

A. Chair’s Report B. President’s Report - p.2C. Report from Committees

II. PRESENTATION

A. Board Member – Steve Holmquist

III. CONSENT ITEMS A. Approval of Minutes of February 22, 2011 - p.4

IV. DISCUSSION AND ACTION ITEMS A. Resolution 11-10 – MHP Authority to loan funds to MHP Edinburgh House LP - p.25

B. Resolution 11-11 – MHP Authority to sign for MHP Edinburgh House, Inc. - p.27C. Resolution 11-14 – MHP as guarantor for MHP EDH, Inc. Letters of Credit - p.30D. Resolution 11-15 - Authority to receive Calvert Pre-development Loan - p.33E. Resolution 11-16 – Addition of Vicki Davis to Executive Committee - p.36

V. REPORT FROM SUBSIDIARIES A. Cash Flow Payments – MHP DRHC, Inc-p.37 MHP Pembridge, Inc.-p.39 and MHP Town

Centre, Inc. -p.41B. MHP Edinburgh House, Inc. – Authorization of sale of Edinburgh House to MHP

Edinburgh House LP -p.43C. MHP EDH, Inc. – Acceptance of equity investment, purchase of property, obtain letter

of credit, and issue stock and amend bylaws on behalf of MHP Edinburgh LP -p.46

VI. INFORMATION ITEMS A. Financial Report - p.61 B. Fundraising Report - p.63

C. Board Calendar - p.65

8:30 VII. ADJOURNMENT

** Directions: Take Georgia Avenue north from the Capital Beltway. Turn right on University Boulevard, then left on Amherst Avenue. Turn left on Elkin Street and then immediately left again into the Amherst Square Apartments parking lot. The Pembridge Square Community Center is at the far end of the parking lot.

M:\Board\Board Packets\2011.04.27 Board Packet\Apr 11.doc

MHP Board PacketApril 27, 2011 of 65


PRESIDENT'S REPORT 1. Parkview Towers (125 units) – MHP selected an architect (Weincek) and contractor (RKR) for the

proposed renovation. The team will submit a bond application to the State of Maryland by the end of April. MHP plans to close on the $200,000 pre-development loan from Capital One in April.

2. Bowie Mill (114 units) – Park and Planning is processing our Preliminary/Final Site Plan application

package that we submitted in January. 3. Maple Towers (36 units) – Construction (substantial) completion is expected by early May and

residents will begin occupying the building by June. 4. Edinburgh House Refinance/Rehab Work (45 units) – MHP is scheduled to close on the project

financing (bonds, tax credits and county loans) the week of May 2nd and begin construction in June. 5. Halpine Refinance/Rehab Work (67 units) – MHP will submit its financing viability package

(including draft construction documents) to the State of Maryland by April 18th. Closing on the financing is planned for November with construction starting in January 2012.

6. 8807 Glenville Road (4 units) – In April, MHP will begin Phase II work at the property that will

include upgrading the electric service, new front steps, and renovated bathrooms. 7. Silver Spring Library Residential Project (up to 140 units) – Our team (MHP and Donohoe) is

currently working with the County to develop a preferred preliminary development scheme that is economically feasible and meets the goals of the county and the development team. After the development scheme is set, our team will negotiate a development agreement with the County. We plan to submit a tax credit application to the State of Maryland in the fall round.

8. 8801 Glenville Road (4 units) – MHP is considering purchasing this abandoned property that will

soon go on the market. 9. Neighborhoods – MHP held a successful foreclosure loan scam prevention neighborhood outreach

event in Gaithersburg on March 26; volunteers canvassed over 600 households. MHP will kick off the Capital Reserve Study of Cinnamon Woods HOA neighborhood in April. MHP sponsored a very successful Long Branch Creek Earth Day clean-up on April 9th and is sponsoring a 1) a tree planting / median landscaping project for Glenville Rd. on April 23rd and 2) a collaborative foreclosure prevention event with a Gaithersburg non-profit HomeFree USA on April 30. The team is applying in conjunction with Park & Planning and DHCA for a $30,000 grant to conduct a public input workshop and Transit Oriented Development study of the Glenmont community for implementation of the Glenmont Sector Plan.


10. MPDU’s – MHP currently has four properties in its pipeline. However, MHP will purchase one for

its rental portfolio (the Winged Elm Property) in April/May after we close on the new line of credit with BB&T. We are also considering renting the other units in the pipeline (say for up to two years) until the for-sale market rebounds.

11. Calvert Foundation Pre-Development Loan – In February, the Calvert Foundation approved

MHP’s application for $500,000 in predevelopment loan funds. We expect to close on the loan by early May.

12. Fundraising –Gail Scott-Parizer hosted a MHP reception at her home on March 20th with about 17

people in attendance. The 23rd Annual Norman Christeller Golf Classic will be held on Monday, May 2nd at Hampshire Greens Golf Course. Tee-off is at Noon and dinner will be served at 6:00 pm. All board members are encouraged to attend the dinner; cost is $50 per person. For more information, contact Lesia Bullock at 301-622-2400 x38 or [email protected].

13. Community Life – Iyahbo Obasi, a homework club participant, won HAND’s Art Contest. Iyahbo’s

artwork will appear on the cover of HAND’S Annual Meeting Program and Membership Directory. Iyahbo will receive a $50 gift certificate, a $250 savings bond and an invitation to attend the HAND Annual Meeting luncheon on May 26, 2011. The staff held several parent meetings last month. Due to the large number of preschoolers graduating (92), we are no longer having 1 graduation ceremony. There will be four: two at Amherst, one at Gilbert, and one at Great Hope. Beginning this month, ESOL, Citizenship, and Computer classes will be held at Pembridge and Greenwood. These classes are part of a new partnership between MHP and Sant and Voit, Inc., a small nonprofit dedicated to helping Latinos increase their employment opportunities and technical skills. Classes will be offered in the mornings, afternoons, evenings, and Saturdays.

14. Personnel – Patty Reed has resigned as Director of Fundraising after 4 years with MHP. We are

currently advertising and recruiting candidates for the position.



MHP Board Meeting February 22, 2011 Meeting called to order at 6:47 p.m.

I. Committee Meetings a. The Finance and Fundraising committees met

II. Presentation

a. Stacy Silber gave a presentation on her background, education, and career

III. Information Exchange a. Report from Committees

i. Fundraising – Stacy Silber reported on behalf of the committee that MHP raised $568,000 over what we had budgeted in 2010; this creates a large goal for 2011 as strategic plan calls for 15% increase; there is a concern about government grants being realized; expecting about $35,000 from Fannie Mae; looking at County Council and County Executive grants which we have not applied for before; golf tournament scheduled for May 2nd; Benavon Model training April 6th and 7th and still looking for some community volunteers who would be willing to participate in training and a 2-year commitment to program (could be spouse, former board member, etc.)

ii. Finance – Chip Bay presented the various issues discussed as they came up on the board agenda

IV. Consent Items – Minutes of January 25, 2011 were unanimously approved

V. Discussion and Action Items

a. Calvert Foundation Loan – Chip Bay reported that this is a $500,000 loan that can be used for pursuit of deals; Board has asked Artie Harris to see if it can be turned into a line of credit; the staff will present a formal request to the board next month for approval

b. Resolution 11-07 – MAHT Application for Halpine Hamlet – Chip Bay reported that this is an application for $150,000 to fill financing gap for Halpine Hamlet and MAHT requires a board resolution in order to apply for the grant; resolution was unanimously approved

c. Resolution 11-08 – CDBG Loan for TPP Weatherization – Chip Bay reported that this money has to be loaned to MHP who in turn will loan to


the properties of TPP to address moisture issues; resolution was unanimously approved

d. Edinburgh House Financing – Chip Bay reported that Edinburgh is closing in April to pay off existing loan and rehab the property; 12 different sources of financing; Artie Harris will do a deal memo in March to go to Finance Committee for approval by the Executive Committee

e. Beall’s Grant – Chip Bay reported that the staff is looking at options; Artie Harris will bring recommendations to Finance Committee next month; County wants the 14-unit building back on-line

VI. Report from Subsidiaries

a. Audit Acceptance – Subsidiary corporations of MHP Blair Park, MHP Greenwood, MHP Great Hope Homes and MHP Takoma will meet to discuss and vote on audit acceptance; all were reviewed by Audit Committee as reported by Gina Williams

b. CDBG Weatherization Loan – MHP Takoma will meet to discuss and vote on weatherization loan

VII. Information Items

a. Financial Report for January b. Fundraising Report for January

VIII. Adjournment at 8:05

Board Members Present: Linda Kelly, Faten Alajmi, Bob Mitchell, Vicki Davis, Rhonda Cunningham Holmes, Chip Bay, Gina Williams, Stacy Silber, Stephen Holmquist, Gail Scott-Parizer Board Members Absent: Ali Solis, Sheila Maith, Richard Perlmutter, Rob Fossi, Vicky Carrasco, Juan Holcomb Staff Present: Jill Goodrich, Artie Harris, Patty Reed, Robert Goldman


MEMORANDUM

TO: Montgomery Housing Partnership’s Board FROM: MHP’s Real Estate Department DATE: April 27, 2011 RE: Approval for construction/permanent financing for Edinburgh House located at

7513 Maple Avenue, Takoma Park, MD, currently owned by MHP Edinburgh House, Inc.

Name and Address: Edinburgh House, 7513 Maple Avenue, Takoma Park, MD Strategic Importance: Update systems and units of MHP-owned high rise Project Type: Rehabilitation of a 45-unit building Total Development Cost: $9,668,299 ($214,851/unit); Hard construction cost, including

construction contingency, of $3,295,358 ($73,230/unit)

Page - 1 -of –10 MHP Board PacketApril 27, 2011 of 65

Location Edinburgh House: 7513 Maple Avenue, Takoma Park, MD 20912

Background

Edinburgh House is a 9-story, 45-unit masonry building with two elevators, built in 1964. MHP purchased the building in 1995 and performed minimal rehabilitation at that time. We are proposing to refinance the property in order to do a moderate rehab of the property and to pay back a Sandy Spring (recourse) loan that is expiring. The owner, not the residents, pays the utilities. Therefore, it is important for MHP to upgrade the current utility structure to a more energy efficient one.

MHP had applied for New Issue Bond Program (NIBP), administered by the State of Maryland, under which bond financing is available at lower, fixed interest rate (4.55%) and was granted the funding. We are required to close on the financing by the week of May 2nd, 2011. The purpose of this memorandum is to obtain the Board’s approval to close on the refinancing of the project. MHP staff reviewed the proposed financing with the Finance Committee on April 11, 2011. The committee agreed to recommend to the full MHP Board that staff move forward with the refinancing.


Rehabilitation Scope: The building will undergo a moderate renovation. We received the building permit for

the work in February 2011. The scope of work includes the following:

EDINBURGH HOUSE REHABILITATION SCOPE

APARTMENT INTERIORS

Kitchens New cabinets and countertops, install pass-thru in kitchen, new energy star appliances, new green flooring (bio-vct), new energy efficient lighting, clean exhaust system, range hoods, update electrical panels

Bathrooms New bathroom vanity cabinet and counter, new lavatory and tub, new ceramic tile floors/surrounds, clean exhaust, new lighting, new accessories, new low flow showerhead, grab bars

Convert 3dwelling units to accommodate residents with physical impairments Other Interior Upgrades

New green carpet, unit entry door replacement, interior door replacement, bi-fold doors, new door hardware, new smoke detectors, new cable/phone wiring, new energy efficient lighting, painting all walls, ceilings, doors and trim, sprinklers, fireproofing, window treatments

BUILDING INTERIORS

Replace chiller/cooling tower, replace boiler, replace water heater, replace corridor HVAC, new generator, new sprinkler system, new fire alarm system, new fire pump, upgrade elevator cab, new fire pump, new fire control center

CORRIDORS/STAIRWELLS

New corridor flooring, paint, lighting, new doors, new fire extinguishers, new acoustical ceilings

BUILDING EXTERIOR

Roof replacement, window and balcony sliding door replacement, new balcony divider screens, vestibule entrance system replacement, new front entrance canopy, exterior paint at ground level

OTHER SITE WORK

Site lighting improvements, parking lot sealing and striping, landscaping, site concrete repairs, jet sewer lines

AMENITIES Laundry room upgrades, reconfigure leasing office, new leasing office toilet room and community room finish upgrades


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Proposed Rents and Unit Mix: The project has a total of 45 units.

UNIT DESCRIPTION

Income Restriction (% of AMI)

Number of Units

Gross** Rent

Unit Sq. Footage

one bedroom 60% 22 $934 670 two bedroom 60% 17 $1,074 927 one bedroom Market 5 $1,104 670 two bedroom Market 1 $1,042 927

45

** Rent include utilities; two-bedroom market rent lower than the average one-bedroom market rent due to one high-income resident that has lived in the building for several years.

These rents are well below the affordability limits as well as market rents. We are restricted to how much rent we can increase rents the first year after the rehab and beyond because we are using County HOME funds. In our analysis, we have assumed, for the first year, no rent increase for tenants who are paying more than 30% of their income in rent and 5% rent increase for other tenants occupying the affordable units. We are assuming a 10% rent increase for market rate units. In subsequent years we are assuming a 2% rent increase per year for all units.

Proposed Expenses: Item Expense/Unit Administration & Professional $2,555 Utilities $2,453 Repair & Maintenance $1,372 Marketing & Leasing $45 Real Estate Taxes $208 Insurance $178 Property Management $584 CDA Monitoring $25Total $7,419 We are installing energy efficient central heating and cooling systems as existing tenants don’t pay for utilities. We are projecting at least 10% savings in the current utility expense. (We considered separately metering the gas and electric, but ultimately decided not to do so due to the cost.) Financing: In order to receive 4% tax credits with the bond financing, we will be transferring the property from the current owner (MHP Edinburgh House, Inc) to a limited partnership (MHP Edinburgh House, LP) with a MHP controlled entity as a general partner (MHP EDH, Inc).


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The project was originally acquired with a $1,350,000 loan (current balance of $1,190,974) from Montgomery County’s Acquisition and Rehab fund and $400,000 loan from Sandy Spring Bank. We will pay back the remaining balance of the Sandy Spring Loan and Montgomery County will transfer their remaining balance to the new ownership entity. MHP will contribute its remaining balance of the appraised price as a seller’s note. Construction and permanent financing is being provided as follows:

SOURCES Total State NIBP $2,620,000

State MHRP $ 500,000

State Better Buildings $ 312,500

MC-HIF $1,159,105

MC-HOME $ 685,000

MHP Sellers Note $2,201,489

NeighborWorks $ 100,000

TD Bank Grant $ 50,000

Interim Income $ 60,000

4% Tax Credit Equity $1,834,107

MHP Loan (20% of Developer fee) $ 146,098

TOTAL $9,668,299

$214,851/unit

USES Total Acquisition Costs $3,777,000

Rehab Costs $3,295,358

Professional Fees & Soft Costs $ 518,068

Financing and Syndication Costs $ 703,813

Reserves $ 379,000

Developer Fee $ 995,060

TOTAL $9,668,299

* Also see attached proforma ** In addition, MHP will put in approximately $480,000 ($250,000 collateral for ST bonds LOC and $230,000 collateral for Neg Arb LOC) of funding during the construction to provide cash collateral for the Letters of Credit. *** Based on the current numbers, MHP will earn around 65%-75% in developer fee State NIBP Bond Financing Terms:

• Term: 40 year term/ 40 year amortization • Rate: 4.55% • DSC: 1.20 • Guarantees: None except for guarantees against bankruptcy, fraud, misrepresentation,

and environmental issues. • Recourse: Only to the property • Status: Received State commitment letter, subject to final underwriting

State MHRP Terms:

• Term: 12 months of construction plus 40 years • Rate: 4% during the permanent period paid out of cash flow (0% during construction);

cash flow only loan • Guarantees: MHP shall execute a guarantee of completion


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• Recourse: Only to the property • Status: Received State commitment letter, subject to final underwriting

State BeSmart Loan (Energy Efficiency program):

• The State is introducing a new energy efficiency loan program called BeSmart to fund green renovations. They plan to allocate $312,500 from that fund to Edinburgh House. The final terms of this cash-flow only loan is still being decided upon but we believe will have 40 year term and 0% interest during construction and 4% interest afterwards

• Status: Received verbal commitment; the State is working on the final terms Sellers Note:

• Term: 40 years • Rate: 4.25% interest paid from available cash flow • MHP is loaning in its equity in the property, defined as the difference between the

current appraisal and the outstanding loans. This process of selling the property for the appraised value to the new entity and loaning in the equity allows us to maximize the tax credits for the deal

County HIF Loan Terms*:

• Term: 40 years • Rate: 0% interest paid from available cash flow • Recourse: Only to the property • Status: The County’s loan committee approved our loan transfer request and issued a

draft commitment letter * This is the current county loan on the property that will be transferred to the new ownership entity (MHP Edinburgh House LP) County HOME Loan Terms:

• Term: 40 years • Rate: 0% interest paid from available cash flow • Recourse: Only to the property • Status: The County’s loan committee approved our loan request for $685,000 and

issued a draft commitment letter

County PILOT Terms: • 100% of County real estate taxes abated for as long as the property complies with the

County’s restrictive covenants • Status: Approved

City PILOT Terms:

• 10-year PILOT; Ten years of 50% abatement of City real estate taxes for as long as the property complies with the City’s restrictive covenants

• Status: Approved

TD Bank Grant: • $50,000; no restrictions • Status: Received funds


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NeighborWorks Capital Loan:• $100,000; no restrictions • Status: Received funds

MHP Loan:

• MHP will earn a total developer fee of approximately $994,000. MHP will receive 25% of the developer fee at closing, 25% at substantial completions, 35% at cost certifications from the State and 15% at submission of 2012 tax returns. MHP will put back approximately $146,098 of that fee in the deal as a loan in order to fill a gap in the sources. We are currently negotiating with the State to be able to use any savings in the development budget to reduce the amount of this loan.

4% Tax credit Equity:

• Enterprise is acting as a syndicator for the 4% tax credits • Tax credit rate: 85 cents (since the finance committee call on April 11, 2011 staff was

able to negotiate an additional 5 cents in credit rate that increase the equity by an additional $100,000)

• Status: Enterprise is finalizing underwriting • Approximate Pay-in Equity Schedule: The project will receive approximately $1.8

Million in tax credit equity; The entire amount will be received at the approval of cost certifications from the State and will be used to pay back the short term bonds.

MHP, Inc. Guarantees

State NIBP Bond Financing

• guaranty of completion State MHRP

• guaranty of completion State BeSMART Loan

• repayment guaranty ($1.75 Million) 4% Tax credit Equity

• guaranty of completion • recapture guaranty • operating deficit guaranty ($250,000 for 5 years)

Letters of Credit (Bank of America)

• repayment guaranty MHP Board Packet

April 27, 2011 of 65

Page - 8 -of –10

Cash Flow Distribution After the must-pay NIBP bond payment, the remainder of the cash is split as follows: 75% to the State of Maryland to pay the MHRP loan and BeSmart loan. The remaining 25% will pay other loans/obligations. The cash flow priority is listed below. Loan 1 - NIBP Bonds

Loan 2 – MHRP Loan

Loan 3-BeSmart Loan

Investor Fee

MHP Asset Management Fee

Loan 4-- Montgomery Co. HIF Loan

Loan 5- Montgomery Co. HOME Loan

Loan 6 - MHP Loan

Loan 7- Seller’s note

Schedule:

(i) Construction Financing Closing – May, 2011 (ii) Construction begins – May 31st, 2011 (iii) Construction completion – July, 2012 (12 month construction period )

Risks:

(i) Construction risk: We have selected a quality contractor (RKR Construction Company) with significant experience in tenant in place multifamily rehab. He recently worked on MHP’s Browning rehabilitation project (16 units) which was also a tenant in place rehab. RKR has the overall bonding capacity of $15 -$20 million and currently they have around $10-$12 million dollars of active bonds. In a month around $6million worth of bonding capacity will be released and they will be able to take on the bonds for Edinburgh House, worth $3million. They have around 10 active projects right now; around 9 of them are scheduled to finish in 2011. The contractor has also been involved with the predevelopment. He also bid out the job to get hard numbers for the scope of work. We believe that the budget plus 10% construction contingency will be sufficient to complete the project.

(ii) Schedule risk: We are currently projecting 12 months of construction.

However, this is a partial tenant in place rehab and factors like tenant behavior can affect the timeline negatively. Also, currently we have three vacant units and we need at least five so that the contractor can work on a full floor at a time. We believe that some of the tenants will take advantage of the opportunity to move to the newly rehabbed Maple Towers located one block away from Edinburgh House, which will be ready to occupy in June 2011. Six residents have already applied to move to Maple Towers


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(iii) Financing:

a. State: CDA wants to include Edinburgh House in the end of May bond escrow break which requires us to close during the week of May 2nd. This is an aggressive timeline and we are working diligently towards meeting that. However, there is also another escrow break in the fall (likely November 2011), which we can go in just in case things don’t work out the way we want them to. That being said the transaction costs would increase considerably if the project closed in the fall round.

CDA is requiring us to procure a letter of credit for the short term bonds and Negative Arbitrage (Neg Arb). We contacted several banks and have chosen to work with Bank of America (BOA). BOA requires 100% cash collateral for the amount of LOC they are providing. Therefore, we need $2,000,000 in cash collateral for short term bonds and $230,000 in cash collateral for Neg Arb. (LOC’s would be out for up to about 24 months-the term of the short term bonds.) CDA has offered to loan MHP $1.75 million from their BeSmart funds to collateralize the bonds as long as MHP brings in the remaining balance. Therefore, MHP would also need to put in (for about 24 months) approximately $480,000 - $250,000 to collateralize the short-term bond LOC and about $230,000 to collateralize the Neg Arb LOC. (MHP has $480,000 in readily available cash to collateralize the LOC’s. In this case we are recommending using the cash for this purpose as 1) we have exhausted other options, 2) we believe this is not a high risk use of the funds and 3) the money is currently earning minimal interest in the bank.) MHP submitted a formal application for the BeSmart financing and the State is reviewing our application, although we were given verbal approval of the loan, which will likely have a 2% interest rate and a 1% origination fee. These loan costs are expected to be nearly $87,500 and will reduce our overall profit (developer fee) as CDA is not allowing these costs as project costs. That being said, having a low interest rate on the BeSmart funds and negotiating an additional 5 cents increase in equity rate discussed above has resulted in an out-of-pocket cost of collateralizing the short-term bonds similar to Guaranteed Investment Contracts.

b. Syndicator—Credit Reallocation Issue: The seller’s note in the deal is creating a tax credit reallocation issue due to related party debt. One option suggested by Enterprise and our tax credit attorney is to put the seller’s note higher on the lien priority--above the BeSmart loan. The State has denied our request to change the seller note priority. Therefore, we will need to bring in a non-related party (profit or non-profit) into the GP and allocate them 21% of the GP ownership interest to avoid reallocation. We would bring in an organization like Victory Housing or CPDC. While MHP has not done this in the past, our tax credit attorney assures us that bringing in a partner to avoid the related party issue is not unusual. Once the syndicator is out of the deal (in 15 years), we can terminate the relationship with the GP partner.


(iv) Tenant Right To Purchase: To receive 4% tax credit financing we are required to transfer the property from the current ownership entity to a new limited partnership. This transaction is triggering City of Takoma Park’s Tenant Right To Purchase requirement. (We originally thought we would be exempt from this law, but recently learned that we were not.) Under the law we had to send out notices to tenants informing them of the purchase price and of the transfer. We also sent out a letter with the official notice that explains to the tenants the purpose of the notice. The tenants have 45 days (until April 25th) to organize and express an interest in purchasing the property. If they express such interest, they have an additional 120 days to submit their contract to purchase the property. We strongly believe the tenants will not organize to purchase the property as we have developed a reasonable amount of goodwill with them and that they are eagerly looking forward to getting the building rehabbed.

While we are still finalizing the loan documents, staff believes that all the major terms have essentially been negotiated. Also, in cases where we have not negotiated the final terms (for example the LOC terms), we have included conservative assumptions. Staff is recommending that the MHP Board approve the proposed financing for the project. What MHP gains is a totally renovated, energy efficient building at a time when long-term financing (permanent and soft) is very hard to obtain. We would not expect any major repairs to the building for 15 to 20 years after the renovation.

Attachment: Proforma


Edinburg House 4% model CDA SOURCES AND USES OF FUNDSExpanded scopeRUN DATE: 4/20/2011

would need bond issue of 4,620,000 to meet 52% test Must Pay (M) orSOURCES OF FUNDS Rate Amortization Term Amount % Per Unit Loan Type Contingent (C) Start DateCDA - Permanent Loan - NIBP 4.55% 40 38 2,620,000 27% 58,222 1 MCDA - MHRP 4.00% 40 40 500,000 5% 11,111 4 CCounty - Loan 0.00% 40 40 1,159,105 12% 25,758 4 C

685,000MHP - Soft Purchase Money Note 0.00% 40 40 2,201,489 23% 48,922 4 CCDA - Better Building 0.00% 40 40 312,500 3% 6,944 4 CMHP Loan 0.00% 40 40 $246,098 3% 5,469 TD Bank Grant 0.00% 40 40 50,000 1% 1,111 Interim Income 60,000 3% 1,333

1=Amortizing M=Must-PayLP Capital Contribution $1,834,107 19% 40,758 2=Interest-only C=Cash Flow

3=Accruing Contingent TOTAL SOURCES OF FUNDS 9,668,299 100% 199,629 4=Cash Flow

Funding Surplus<Gap>: 0

3.00% Credit 3.33% Credit NonAPPLICATION OF FUNDS Per Unit Total Depreciable Rehab Acquisition DepreciableACQUISITION COSTSPurchase Price: Land % of Total = 34.1% 28,000 1,260,000 - Purchase Price: Buildings % of Total = 65.9% 54,222 2,440,000 2,440,000 2,440,000 Title Insurance, Recording, Closing Costs 556 25,000 16,475 25,000 Acquisition Legal Fees 333 15,000 9,885 15,000 Transfer Taxes 822 37,000 24,383 29,600 12,617 Other Acquisition (Specify:) - - - -

Subtotal 83,933 3,777,000 2,490,743 - 2,509,600 12,617

CONSTRUCTION/REHABILITATION COSTSRehabilitation: Residential 58,037 2,611,669 2,611,669 2,611,669General Requirements 3,912 176,061 176,061 176,061Contractor Overhead 1,239 55,755 55,755 55,755Contractor Profit 1,858 83,632 83,632 83,632Payment & Performance Bond 778 35,001 35,001 35,001GL Insurance 748 33,662 33,662 33,662Construction Contingency 10.00% 6,657 299,578 299,578

Subtotal 73,230 3,295,358 3,295,358 2,995,780 - -

PROFESSIONAL FEES & OTHER SOFT COSTSArchitect Design 3,009 135,400 135,400 135,400Architect Supervision 667 30,000 30,000 30,000Engineering 111 5,000 5,000 5,000Environmental Site Assessment/Bldg report 756 34,000 34,000 34,000Survey (Boundary/Topo/As-Built) 356 16,000 16,000 16,000Building Permits 1,444 65,000 65,000 65,000Impact Fees/County Fees - - Hazard & Liability Insurance (Construction Period) 222 10,000 10,000 10,000Closing Costs/Title Insurance 889 40,000 40,000 40,000Real Estate Taxes/ Fees - - Market Study 141 6,350 6,350 6,350Appraisal 171 7,680 7,680 7,680Accounting/Audit 178 8,000 8,000 8,000Cost Certification 222 10,000 10,000 10,000Legal Fees: Real Estate (Developer) 889 40,000 40,000 40,000Consultant Fees 111 5,000Construction Management Fees 1,333 60,000Developer Fees 22,112 995,060 922,835 593,157 388,950 Soft Cost Contingency 1,014 45,638 45,638

Subtotal 33,625 1,513,128 1,375,903 1,000,587 388,950 -

FINANCING COSTSConstruction Loan Interest - CDA % Expensed = 4.55% 6,333 285,000 85,500 285,000MHF Closing fee 1,000CDA - Bond costs (issuance, legal, underwriter, etc.) 2,053 92,400 28,644CDA - Risk Share Application Fee 58 2,620 1,432CDA - Origination Fees 1,540 69,300 2,079 21,483CDA - Initial MIP - Construction Period 1,456 65,500 1,965 115,500CDA - Legal 778 35,000 35,000 10,850Negative ArbitrageLOC costs 104,700 48,000

- - Subtotal 12,218 655,520 124,544 510,909 - -

TAX CREDIT & SYNDICATION COSTSTax Credit Application Fees Eligible?(Y/N) Y 22 1,000Tax Credit Allocation Fee 8,630Legal/Organizational Fees (Developer) 387 17,412 10,000 Tax Credit Consultant Eligible?(Y/N) Y 472 21,250

- 0 - Subtotal 881 48,293 - 10,000 - -

START-UP COSTS, RESERVES & ESCROWS

Tenant Relocation (Basis Eligible) 2,500 112,500 112,500 112,500Operating Reserves (Capitalized) 0.79 months Expense/Hard Debt 735 33,089 33,089 Existing Resrve 134,911Replacement Reserve (Capitalized) 757 34,048 34,048 Existing Resrve 55,952Rental reserve 189 8,500 8,500

- - Subtotal 4,181 379,000 112,500 - 112,500 75,637

TOTAL APPLICATION OF FUNDS 214,851 9,668,299 7,399,048 4,517,276 3,011,050 88,254

CODE

RESIDENTIAL


Edinburg House 4% model RENT, EXPENSE AND TIMING ASSUMPTIONS

Run Date:RESIDENTIAL RENTAL INCOME ASSUMPTIONS

Income Percent Monthly Monthly Annual Required MaximumRestriction Number of Number Utility Unit Sq. Market Below Rent per Rental Rental Rental Tenant Restricted Percent of

UNIT DESCRIPTION (% of AMI) Bedrooms of Units Allowance Gross Rent Footage Rents Market Sq. Foot Allowance Income Income Income Rent (Gross) Median

one bedroom - affordable 60% 1 22 $934 670 1,131 17.44% 1.394 934 20,541 246,496 37,348 1,131 48.11%two bedroom - affordable 60% 2 17 $1,074 927 1,288 16.62% 1.158 1,074 18,256 219,077 42,956 1,288 46.11%one bedroom - market mkt 1 5 $1,104 670 1,131 2.39% 1.648 1,104 5,520 66,240 44,160 1,131 56.89%two bedroom - market mkt 2 1 $1,042 927 1,288 19.10% 1.124 1,042 1,042 12,504 41,680 1,288 44.75%

- - - TOTAL 45 $1,008 34,776 53,721 45,360 544,317 $40,320 48.26%

0

RENTAL ASSUMPTIONS: Residential Commercial 2011 expenses Total Per UnitAccounting 6,763 -

No. Months of Rent in Year 1 12 12 Legal 1,687 - No. Months of Expenses in Year 1 12 12 Total Professional Fees 8,450 188 No. Months Depreciation in Year 1 12 12 Overheard 14,885 - Annual Rent Increase 2.0% 2.0% Payroll and Payroll Taxes 66,612 - Annual Rent Increase (Year 1 - 2 only) 2.0% 2.0% Workmen's Comp & Emp Benefits 4,404 - Annual Expense Increase 3.0% 3.0% Misc. Administrative Expenses 20,628 - Annual Expense Increase (Year 1 - 2 only) 3.0% 3.0% Total Administrative 106,529 2,367 Vacancy Loss, Year 1 7.0% 5.0% Gas/Oil 51,049 - Vacancy Loss Years 2-16 5.0% 5.0% Electricity 36,401 - Property Management Fee 5.0% Water/Sewer 22,915 - Replacement Reserve 325 Other -Other Income 22,000 Total Utilities 110,365 2,453 204$ PUPMInterest on Reserve Accounts 2.0% Extermination 5,024 - Median Income--Year--County/MSA $103,500 2010 Trash Removal 7,680 - HUD Statistical Area (MSA, PSA, County): DC Security 2,996 -

Janitorial Supplies & Salaries 1,730 - Repair Contracts/Labor 10,654 -

TAX CREDIT ASSUMPTIONS Painting/Decorating/Supplies 8,281 - Grounds Maintenance 9,394 - RE Taxes

Year of Credits Allocation: 2010 5% Elevator 8,751 No PILOT PILOT 50%PILOTTax Credit Rate Lock Date: Other 7,213 15,590 3,140 9,356

RATE Total Repairs and Maintenance 61,723 1,372 Acquisition Credit Rate: 3.33% Total Marketing and Leasing 2,022 2,022 45 New Construction/Rehab Rate: 3.00% Total Real Estate Taxes 9,356 208

Total Insurance 8,000 178 DDA/QCT Basis Boost 100.00% Total Property Management Fee 26,306 26,306 585 5.0%Applicable Fraction (% TC Units) 86.67% Partnership Management Fee (Must Pay) -

Acquition Basis - 4% 2,609,577 Investor Services Fee (Must Pay) - Rehab Basis - 4% 3,914,973 Other Fees (Must Pay) CDA MIP 13,100 291

Max. Proposed Credits $215,777 Total Other Fees 13,100 291 Tax Credit Allocation Misc. Expense - CDA Monitoring Fee 1,350 30 Equity Price 0.85$ Misc. Expense MHP Asst. Admin Fee 4%Tax Credit Equity $1,834,107 Total Miscellaneous Expenses 1,350 30

Total Operating Expenses/Unit 347,202 7,671


Edinburg House 4% model CASH FLOW (PAGE 1) DATE:

RUN DATE:1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

RENTAL INCOME Year: 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 TOTALYr. 1 Vacancy Inflator

Gross Rental Income - Residential 102% 543,728 554,602 565,694 577,008 588,548 600,319 612,326 624,572 637,064 649,805 662,801 676,057 689,578 703,370 717,437 731,786 10,134,698Other Income - Residential 102% 22,000 22,440 22,889 23,347 23,814 24,290 24,776 25,271 25,777 26,292 26,818 27,354 27,901 28,459 29,029 29,609 410,064 Less Vacancy (Year 1/Years 2-16) 7.0% 5.0% 39,601 28,852 29,429 30,018 30,618 31,230 31,855 32,492 33,142 33,805 34,481 35,171 35,874 36,591 37,323 38,070 538,552

103% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 # 0Other Income - Commercial 102% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Less Vacancy (Year 1/Years 2-16) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

NET RENTAL INCOME 526,127 548,190 559,154 570,337 581,744 593,379 605,246 617,351 629,698 642,292 655,138 668,240 681,606 695,238 709,143 723,325 10,006,210

EXPENSESInflator

Total Professional Fees 103% 8,450 8,704 8,965 9,234 9,511 9,796 10,090 10,393 10,705 11,026 11,357 11,698 12,049 12,410 12,782 13,165 170,335Total Administrative 103% 106,529 109,725 113,017 116,408 119,900 123,497 127,202 131,018 134,949 138,997 143,167 147,462 151,886 156,443 161,136 165,970 2,147,306Total Utilities 103% 110,365 113,676 117,086 120,599 124,217 127,944 131,782 135,735 139,807 144,001 148,321 152,771 157,354 162,075 166,937 171,945 2,224,615Total Repairs and Maintenance 103% 61,723 63,575 65,482 67,446 69,469 71,553 73,700 75,911 78,188 80,534 82,950 85,439 88,002 90,642 93,361 96,162 1,244,137Total Marketing and Leasing 103% 2,022 2,083 2,145 2,209 2,275 2,343 2,413 2,485 2,560 2,637 2,716 2,797 2,881 2,967 3,056 3,148 40,737Total Real Estate Taxes 103% 9,356 9,637 9,926 10,224 10,531 10,847 11,172 11,507 11,852 12,208 12,574 12,951 13,340 13,740 14,152 14,577 188,594Total Insurance 103% 8,000 8,240 8,487 8,742 9,004 9,274 9,552 9,839 10,134 10,438 10,751 11,074 11,406 11,748 12,100 12,463 161,252Total Property Management Fee 103% 26,306 27,410 27,958 28,517 29,087 29,669 30,262 30,868 31,485 32,115 32,757 33,412 34,080 34,762 35,457 36,166 500,310Total Other Fees 100% 13,100 13,493 13,493 13,493 13,493 13,493 13,493 13,493 13,493 13,493 13,493 13,493 13,493 13,493 13,493 13,493 215,495Total Miscellaneous Expenses 103% 1,350 1,391 1,433 1,476 1,520 1,566 1,613 1,661 1,711 1,762 1,815 1,869 1,925 1,983 2,042 2,103 27,220

TOTAL EXPENSES: 347,201 357,933 367,992 378,348 389,007 399,982 411,279 422,910 434,884 447,211 459,901 472,966 486,416 500,263 514,516 529,192 6,920,001

NET OPERATING INCOME 178,926 190,257 191,162 191,989 192,737 193,397 193,967 194,442 194,814 195,081 195,237 195,274 195,189 194,975 194,627 194,133 3,086,209Operating Reserve 103% 0Replacement Reserve 102% 14,625 14,918 15,216 15,520 15,831 16,147 16,470 16,800 17,136 17,478 17,828 18,184 18,548 18,919 19,297 19,683 272,600Rent Up reserve 8,500NOI ADJUSTED FOR RESERVES 172,801 175,339 175,947 176,469 176,906 177,250 177,497 177,642 177,679 177,603 177,409 177,090 176,641 176,056 175,329 174,450 2,813,609Available for D/S

DEBT SERVICE 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 TOTAL

CDA - Permanent Loan - NIBP 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 Loan Balance 2,620,000 2,596,367 2,571,635 2,545,755 2,518,672 2,490,330 2,460,672 2,429,636 2,397,158 2,363,171 2,327,606 2,290,387 2,251,440 2,210,682 2,168,032 2,123,399 2,076,693 Principal Paid 23,633 24,731 25,881 27,083 28,341 29,658 31,036 32,478 33,987 35,566 37,218 38,948 40,757 42,651 44,632 46,706 543,307 Interest Accrued 0 Interest-Paid 4.55% 118,721 117,623 116,474 115,272 114,013 112,697 111,319 109,877 108,368 106,789 105,136 103,407 101,598 99,704 97,722 95,649 1,734,368Total 142,355 142,355 142,355 142,355 142,355 142,355 142,355 142,355 142,355 142,355 142,355 142,355 142,355 142,355 142,355 142,355 2,277,674

DSC Ratio-1st Mortgage 1.21 1.23 1.24 1.24 1.24 1.25 1.25 1.25 1.25 1.25 1.25 1.24 1.24 1.24 1.23 1.2330,446.16 32,984.83 33,592.01 34,114.22 34,551.56 34,895.42 35,142.31 35,287.68 35,324.21 35,248.62 35,054.70 34,735.40 34,286.68 33,701.69 32,974.66 32,094.92

75% to CDA MHRP/B&B 22,834.62 24,738.62 25,194.00 25,585.66 25,913.67 26,171.57 26,356.73 26,465.76 26,493.16 26,436.46 26,291.02 26,051.55 25,715.01 25,276.27 24,731.00 24,071.1925% remaining 7,611.54 8,246.21 8,398.00 8,528.55 8,637.89 8,723.86 8,785.58 8,821.92 8,831.05 8,812.15 8,763.67 8,683.85 8,571.67 8,425.42 8,243.67 8,023.73

CDA - MHRP 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 192 Loan Balance 500,000 500,000 497,165 492,313 487,006 481,307 475,280 468,995 462,525 455,946 449,339 442,789 436,385 430,220 424,392 419,002 414,157 Principal Paid Interest Accrued 4.00% 20,000 19,887 19,693 19,480 19,252 19,011 18,760 18,501 18,238 17,974 17,712 17,455 17,209 16,976 16,760 16,566 Interest-Paid #Total Paid 22,835 24,739 25,194 25,586 25,914 26,172 26,357 26,466 26,493 26,436 26,291 26,052 25,715 25,276 24,731 24,071 # 408,326

DSC Ratio-1st, 2nd Mortgage 1.05 1.05 1.05 1.05 1.05 1.05 1.05 1.05 1.05 1.05 1.05 1.05 1.05 1.05 1.05 1.05

CDA-Better Buildings 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 Loan Balance 212,500 212,500 232,488 252,476 272,464 292,452 312,440 332,428 352,416 372,404 392,392 412,380 432,368 452,356 472,344 492,332 512,320 Principal Paid Interest Accrued Interest-Paid 4.00% 8,500 9,300 10,099 10,899 11,698 12,498 13,297 14,097 14,896 15,696 16,495 17,295 18,094 18,894 19,693 20,493Total 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

DSC Ratio-1st Mortgage 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Cash Flow 30,446 32,985 33,592 34,114 34,552 34,895 35,142 35,288 35,324 35,249 35,055 34,735 34,287 33,702 32,975 32,09575% to CDA - MHRP 22,835 24,739 25,194 25,586 25,914 26,172 26,357 26,466 26,493 26,436 26,291 26,052 25,715 25,276 24,731 24,071Remaining 7,612 8,246 8,398 8,529 8,638 8,724 8,786 8,822 8,831 8,812 8,764 8,684 8,572 8,425 8,244 8,024

Investor fee 5,000 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524 6,720 6,921 7,129 7,343 7,563 7,7901

MHP Asset Mgmt FeeFee Earned by MHP 21,045 21,928 22,366 22,813 23,270 23,735 24,210 24,694 25,188 25,692 26,206 26,730 27,264 27,810 28,366 28,933 192Cash Flow Payment Available 2,612 3,096 3,094 3,065 3,010 2,927 2,815 2,673 2,497 2,288 2,044 1,763 1,443 1,083 681 234Total Remaining to Be Paid 18,434 18,831 19,273 19,749 20,259 20,808 21,395 22,022 22,691 23,403 24,161 24,967 25,821 26,727 27,685 28,699 0

00

County HIF and HOME 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 0 Loan Balance 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 1,159,105 Principal Paid 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Interest Accrued 0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Interest PaidTotal Paid 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

DSC Ratio-1st, 2nd, 3rd Mortgage 1.03 1.03 1.03 1.03 1.03 1.03 1.03 1.04 1.04 1.04 1.04 1.04 1.04 1.04 1.05 1.05 192

0MHP - Soft Purchase Money Note 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 0 Loan Balance 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 2,201,489 # Principal Paid 0 0 0 0 0 0 0 0 0 0 Interest Accrued 0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Interest Paid 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Total Paid 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

DSC Ratio-1st, 2nd, 3rd, 4th Mortgage

TOTAL

4/20/11 10:57 AM

\\mhpserv01\data\Properties\Edinburgh House\Real Estate Development\Bond Financing\Financial models\Edinburgh APRIL 2011 NIBP.xlsCF 4/20/201110:59 AM


50% Test

Rule:Bond proceeds must finance at least 50% of depreciable basis plus land. The test must be met at construction completion.

Sources tab:Bond amount 2,620,000Additions/Subtractions to Bond amount for purposes of 50% test 1,749,519 4,369,519Additions/Subtractions to Bond amount for purposes of 50% test 174,781 4,544,300Additions/Subtractions to Bond amount for purposes of 50% testTotal Bond financing: 4,544,300

Uses tab:Land and Related Non-Depreciable Costs 1,339,990Depreciable assets 7,399,048Total: 8,739,038 4,520,000

52% 52%


Edinburgh House-Rent structure as on 12/20104/20/2011JANUARY BR Current Annual % of Allowable rent Increase Affordable/ Hshld 2010

Bldg. # Unit # Resident Name Size Rent Rent income Income Rent % Market Size Recert Income1 7513 102 Fasika Gebrhana 1 $1,051.00 $12,612.00 24% $15,926.24 $1,327.19 $1,103.55 5% A 3 $53,087.45

2 7513 202 Mulu Ghebremedhim 1 $690.00 $8,280.00 33% $690.00 A 1 $25,194.00 690

3 7513 203 Kristina McNeeley 1 $761.00 $9,132.00 31% $761.00 A 2 $29,700.004 7513 204 Eileen Glew 1 $922.00 $11,064.00 $922.00 A 15 7513 302 Elisha Stanley 1 $689.00 $8,268.00 21% $11,577.38 $964.78 $723.45 5% A 2 $38,591.286 7513 303 Marie Manneh 1 $848.00 $10,176.00 25% $12,419.10 $1,034.93 $890.40 5% A 2 $41,397.007 7513 304 1 VACANT VACANT VACANT $1,000.00 A VACANT8 7513 403 Halimata Diallo 1 $867.00 $10,404.00 72% $867.00 A 2 $14,400.00 8679 7513 502 1 VACANT VACANT VACANT $1,000.00 A VACANT

10 7513 503 Akberet Woldegebriel 1 $698.00 $8,376.00 47% $698.00 A 1 $18,006.56 69811 7513 504 Sally Clayton 1 $1,022.00 $12,264.00 33% $1,022.00 A 2 $37,264.5012 7513 602 Abiyu Geleta 1 $861.00 $10,332.00 41% $861.00 A 2 $24,968.3213 7513 603 Mariana Vischnewsky 1 $855.00 $10,260.00 Section 8 $897.75 5% A 1 $8,088.0014 7513 604 Nicole Cambosos 1 $990.00 $11,880.00 30% $990.00 A 1 $40,000.0015 7513 702 Rose Lonon 1 $785.00 $9,420.00 46% $785.00 A 1 $20,354 78516 7513 703 Damion Wise 1 $1,022.00 $12,264.00 26% $13,923.78 $1,160.32 $1,073.10 5% A 1 $46,412.6017 7513 704 1 VACANT VACANT VACANT $1,000.00 A VACANT18 7513 904 Eloy Barragan 1 $754.00 $9,048.00 45% $754.00 A 2 $20,160.00 75419 7513 402 Adane Zegeye 1bd $1,019.00 $12,228.00 29% $12,803.36 $1,066.95 $1,066.00 5% A 2 $42,677.8620 7513 404 Erminia Quinn 1bd $1,018.00 $12,216.00 Section 8 $1,068.90 5% A 1 $8,088.0021 7513 803 Betelhem Kiflu 1bd $1,050.00 $12,600.00 Section 8 $1,102.50 5% A 1 $17,522.1222 7513 902 Maria Fuentes 1bd $1,022.00 $12,264.00 30% $1,022.00 A 1 $41,100.80

$19,607.65 759$933.70

23 7513 105 Doneme Destine 2/1b $914.00 $10,968.00 36% $914.00 A 3 $30,169.8824 7513 205 Michael Kidanemariam 2/1b $1,160.00 $13,920.00 38% $1,160.00 A 4 $37,052.7025 7513 305 Yohannes Tecle 2/1b $1,153.00 $13,836.00 38% $1,153.00 A 4 $36,200.0026 7513 405 Habenzghi Gherezghiher 2/1b $958.00 $11,496.00 22% $15,654.89 $1,304.57 $1,005.90 5% A 3 $52,182.9627 7513 605 Sied Ahmed 2/1b $1,192.00 $14,304.00 76% $1,192.00 A 3 $18,700.0028 7513 705 Kifleysus Desta 2/1b $1,157.00 $13,884.00 75% $1,157.00 A 3 $18,408.0029 7513 805 Adriane Starch 2/1b $1,155.00 $13,860.00 40% $1,155.00 A 1 $34,548.8030 7513 905 Asefash Whemnot 2/1b $999.00 $11,988.00 25% $14,250.00 $1,187.50 $1,048.95 5% A 2 $47,500.00

$8,785.85$1,098.23

31 7513 101 Almaz Berhane 2/2b $959.00 $11,508.00 43% $959.00 A 3 $26,603.2032 7513 201 Rosalie Clinton 2/2b $909.00 $10,908.00 23% $14,272.44 $1,189.37 $954.45 5% A 2 $47,574.8033 7513 301 Genet Amanuel 2/2b $1,007.00 $12,084.00 Section 8 $1,057.35 5% A 2 $8,088.0034 7513 401 Edward Wiggins 2/2b $1,000.00 $12,000.00 36% $1,000.00 A 4 $33,280.0035 7513 501 Eli Tituana 2/2b $1,177.00 $14,124.00 43% $1,177.00 A 4 $33,003.3636 7513 601 Diane McClure 2/2b $1,218.00 $14,616.00 41% $1,186.00 A 2 $35,343.3637 7513 701 Michelle Diagne 2/2b $1,241.00 $14,892.00 31% $1,241.00 A 2 $48,180.0038 7513 801 Mebrat Negusse 2/2b $1,033.00 $12,396.00 88% $1,033.00 A 2 $14,088.0039 7513 901 Hirut Mammo 2/2b $1,007.00 $12,084.00 23% $15,581.28 $1,298.44 $1,057.35 5% A 3 $51,937.60

$9,665.15$1,073.91

40 7513 103 Rahel Bahiru 1 $1,021.00 $12,252.00 18% $20,906.40 $1,742.20 $1,123.00 10% M 2 $69,688.0041 7513 104 Matthew Jackson 1 $1,031.00 $12,372.00 14% $26,205.60 $2,183.80 $1,134.00 10% M 2 $87,352.0042 7513 802 Ashenafi Teghegne 1 $1,018.00 $12,216.00 19% $19,071.23 $1,589.27 $1,120.00 10% M 2 $63,570.7843 7513 903 Elston Johnson 1 $930.00 $11,160.00 22% $15,484.98 $1,290.42 $1,023.00 10% M 1 $51,616.6144 7513 804 Dale Jackson 1bd $1,019.00 $12,228.00 25% $14,458.11 $1,204.84 $1,120.00 10% M 1 $48,193.70

$5,520.00$1,104.00

45 7513 505 Margaret Musamba 2/1b $948.00 $11,376.00 13% $26,290.20 $2,190.85 $1,042.00 10% M 2 $87,634.00

$543,728

HOME LIHTC1BR 970 1,1642BR 1,165 1,398

30% income


Developer Fee earned 995,060$

Costs to MHPMHP Loan (from the developer fee) 99,018$ BeSmart Financing Fees for 1,750,000$ Origination fee (1%) 17,500$ Interest (2%) 70,000$

87,500

Net Balance 808,542

% developer fee retained 81%

LOC GIC EQUITY COLLATERALB of A 1% up front plus 200 bps per year $20,000 plus $30,000 x 2yrs 80,000 30,000 80,000

Legal 13,500 13,000 13,500

Borrower $1.75 mil from State for 100% cash collateral BESMART 87,500 52,000 45,000

Interest for 2 yrs at 1.5% est coupon (none as the bonds are not privately placed) Construction Interest 60,000 39,000 60,000Additional Equity (107,889)

TOTAL 133,112 134,000 198,500

NEG ARB COSTS 106,000 106,000 106,00063,000 63,000 63,000

TOTAL WITH NEG ARB 239,112 240,000 304,500196,112 197,000 261,500

COLLATERAL REQUIRED 250,000 1,040,000 900,000


MEMORANDUM To: MHP Board From: Real Estate Department Date: April 2011 Board Meeting RE: Edinburgh House Apartments: Resolutions for property transfer and refinancing–

MHP, EDH Inc. Resolutions 11-03, 11-04, 11-05 & 11-06; MHP, Inc. Resolutions 11-10, 11-11, & 11-14; and MHP Edinburgh House, Inc. 11-01; First Amendment to Bylaws of MHP EDH, Inc.; Unanimous Written Consent of the Board of Directors in Lieu of an Organizational Meeting of MHP EDH, Inc.

MHP Edinburgh House, Inc. (current owner) The attached MHP Edinburgh House, Inc. Resolution 11-01 authorizes MHP Edinburgh House, Inc. to sell Edinburgh House Apartments to MHP Edinburgh House LP and to provide a Purchase Money loan to the LP (that is, MHP is loaning in its equity from the sale of the property). MHP EDH, Inc. (General Partner of future owner, MHP Edinburgh House, LP.) The attached MHP EDH, Inc. Resolution 11-03 authorizes MHP EDH, Inc (general partner of MHP Edinburgh House LP) to accept an equity investment from an affiliate of Enterprise Community Investment, on behalf of MHP Edinburgh House LP. The attached MHP EDH, Inc. Resolution 11-04 authorizes MHP EDH, Inc. to 1) acquire the property, 2) accept loans from CDA, MD DHCD, the County, the Seller, and MHP, Inc. (including a $50,000 grant from TD Bank to MHP, Inc. that MHP, Inc. will loan to MHP Edinburgh House LP), and 3) enter into a property management agreement, on behalf of MHP Edinburgh House LP. The attached MHP EDH, Inc. Resolution 11-05 authorizes MHP EDH, Inc. to obtain a direct pay letter of credit and a standby letter of credit from Bank of America, N.A., on behalf of MHP Edinburgh House LP. The attached MHP EDH, Inc. Resolution 11-06 authorizes MHP EDH, Inc. to: 1) issue 100 shares of common stock and to sell 79 shares to MHP, Inc. and 21 shares to an unrelated private or non-profit company to be determined, and 2) modify the Bylaws and adopt the First Amendment to the Bylaws of MHP EDH, Inc. Montgomery Housing Partnership, Inc. (Guarantor & Developer) The attached MHP, Inc. Resolution 11-10 authorizes MHP to: 1) loan up to $400,000 to MHP Edinburgh House LP, 2) accept a $50,000 grant from TD Bank, and 3) loan the grant funds to MHP Edinburgh House LP. The attached MHP, Inc. Resolution 11-11 authorizes MHP to act as guarantor for MHP Edinburgh House LP on the CDA loans, including the approval of a confession of judgment clause, and on the Equity Investment. It also authorizes MHP to enter into an asset


management, a development services, and a social services agreement(s) with MHP Edinburgh House LP. Resolution 11-11 also allows MHP to accept 79 shares of MHP EDH, Inc. and approves the transfer of remaining stocks (21) to different entity, in order to avoid a reallocation of tax credits (see attachment for list of guarantees). The attached MHP, Inc. Resolution 11-14 authorizes MHP to:

1. Act as guarantor for MHP EDH, Inc. with respect to the Letters of Credit and put in approximately $480,000 ($250,000 collateral for ST bonds LOC and $230,000 collateral for Neg Arb LOC) of funding during the construction to provide cash collateral for the Letters of Credit.

2. Obtain a BeSMART Loan of approximately $1.75 million from MD DHCD, which will also be used as cash collateral for the Letters of Credit.

3. Execute any further documents required in relation to the Letters of Credit, including the approval of a confession of judgment clause.

Attached is a break out of all the MHP guarantees for the project.


MHP, INC. GUARANTEES FOR EDINBURGH HOUSE

New Issue Bond Program (CDA)

- guaranty of completion Multifamily Housing Rehabilitation Program (DHCD)

- guaranty of completion BeSMART Multifamily Loan to MHP EDH, Inc. (DHCD)

- repayment guaranty Equity Investment (Enterprise affiliate)

- guaranty of completion - recapture guaranty - operating deficit guaranty

Letters of Credit (Bank of America)

- repayment guaranty



RESOLUTION 11-10

RESOLUTION OF THE BOARD OF DIRECTORS OF Montgomery Housing Partnership, Inc.

The Board of Directors of Montgomery Housing Partnership, Inc. (“MHP” or the “Corporation”), a Maryland not-for-profit corporation, hereby adopts by majority vote of the Board of Directors of said corporation on the _____ day of April, 2011, the following resolution: WHEREAS, the Corporation was established exclusively for the purposes of providing for the development or preservation of affordable housing in Montgomery County, Maryland for needy persons as generally determined by reference to criteria and guidelines established by federal, state, and local government agencies; and WHEREAS, the Corporation established MHP Edinburgh House LP (the “Partnership”), whose sole general partner is MHP EDH, Inc., which is wholly owned by the Corporation, to acquire, own, renovate and operate the property located at 7513 Maple Avenue, Takoma Park, MD and known as Edinburgh House Apartments (the “Project”), in order to preserve the Project as affordable housing; and

WHEREAS, the Corporation will provide a loan to the Partnership in an amount not to exceed $250,000.00 without interest to be due in full in 40 years and an additional loan of up to $150,000.00 with an interest rate of 4.25% to be due in full in 40 years (collectively, the “MHP Loans”).

WHEREAS, the Corporation desires to accept a grant from TD Bank (the “TD Bank

Grant”) and to loan the funds received to the Partnership in the approximate amount of $50,000.00 without interest to be due in full in 40 years (the “TD Bank Loan”). NOW, THEREFORE, BE IT RESOLVED that the President or Assistant Secretary of the Corporation acting together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation to negotiate and consummate the MHP Loans and to execute, seal, acknowledge, and deliver all documents, instruments, and affidavits of every kind and description in connection with the MHP Loans.

BE IT FURTHER RESOLVED, that the Vice President or Assistant Secretary acting together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation, and under the Corporation seal to execute, seal, acknowledge, and deliver to TD Bank all documents, instruments, and affidavits of every kind and description in connection with the TD Bank Grant including, but not limited to a Grant Agreement, as may be required by TD Bank. BE IT FURTHER RESOLVED that the President or Assistant Secretary of the Corporation acting together or either one acting alone, are authorized and directed on behalf of


2

and in the name of the Corporation to negotiate and consummate the Loan and execute, seal, acknowledge, and deliver all documents, instruments, and affidavits of every kind and description in connection with the TD Bank Loan.

I HEREBY CERTIFY, that the foregoing resolution was duly adopted by the Executive Committee of the Board of Directors of the Corporation and that I am Jill Goodrich, Assistant Secretary of the Corporation. ___________________________________ Jill Goodrich, Assistant Secretary



RESOLUTION 11-11


The Board of Directors of Montgomery Housing Partnership, Inc. (“MHP” or the “Corporation”), a Maryland not-for-profit corporation, hereby adopts by majority vote of the Board of Directors of said corporation on the _____ day of April, 2011, the following resolution: WHEREAS, MHP was organized for the purpose, among others, of developing and operating low-income housing; WHEREAS, MHP EDINBURGH HOUSE LP (the “Partnership”), whose sole general partner is MHP EDH, Inc., (the “General Partner”) was organized to own, renovate, operate, manage and lease a rental apartment facility located in Takoma Park, Maryland known as 7513 Maple Avenue (the “Property”) and has 100 shares of common stock; WHEREAS, to avoid reallocation of the tax credits, the General Partner wishes to sell 79 shares of common stock to MHP and 21 shares of common stock to an unrelated private or non-profit company to be determined at the value of $1.00 per share; WHEREAS, MHP desires to acquire 79 shares of common stock of the General Partner for $1.00 per share; WHEREAS, MHP Edinburgh House, Inc., an entity wholly controlled by MHP currently owns the Property; WHEREAS, MHP Edinburgh House, Inc. has been authorized to enter into an agreement to sell the Property to the Partnership;

WHEREAS, the Partnership will obtain a loan from the Community Development Administration, a unit of the Maryland Department of Housing and Community Development in an amount not to exceed $4,620,000.00 (the “CDA Loan”) to provide funding for the acquisition and renovation of the Property;

WHEREAS, the Partnership desires to accept a Maryland Housing Rehabilitation

Program loan from Maryland Department of Housing and Community Development (DHCD) in the approximate amount of $500,000.00 (the “DHCD Loan”), the proceeds of which are to be used by the Partnership to provide acquisition and renovation financing on the Project;

MONTGOMERY HOUSING PARTNERSHIP, INC. 11-11 1 MHP Board PacketApril 27, 2011 of 65

MONTGOMERY HOUSING PARTNERSHIP, INC. 11-11 2

WHEREAS, the Partnership desires to accept a BeSmart energy loan from DHCD with final terms to be approved by the President or Vice President of the Corporation on behalf of the Partnership, in the approximate amount of $312,500.00 (the “DHCD Energy Loan”), the proceeds of which are to be used by the Partnership to provide energy efficient renovations to the Project;

WHEREAS, the Partnership wishes to obtain an equity investment from an affiliate of

Enterprise Community Investment, Inc. (“Enterprise”), in the approximate amount of $1,800,000.00 (the “Investment”);

WHEREAS, in connection with the CDA Loan, the DHCD Loan, and the DHCD Energy

Loan (collectively, the “Loans”), certain commitments and obligations of MHP are required; WHEREAS, in connection with the Investment, certain commitments and obligations of

MHP are required; WHEREAS, the Board of Directors of MHP deems it to be in the best interests of MHP to take all actions to facilitate the financing to be provided to the Partnership by entering into any and all agreements and guarantees, including but not limited to a Guaranty of Completion and Operating Deficit Guarantee to consummate the Loans and Investment and to take any and all further actions to facilitate them; and WHEREAS, the Partnership has requested that the Corporation provide certain social services, development services, and management services to the Project, which services are consistent with the Corporation’s charitable purposes. NOW, THEREFORE, BE IT RESOLVED, that MHP is hereby authorized to enter into, execute and deliver all guarantees in connection with the Loans and the Investment. BE IT FURTHER RESOLVED, that MHP acknowledges and accepts the inclusion of a confession of judgment provision in the loan documents evidencing the CDA Loan in favor of CDA, including any promissory note, deed of trust, security agreement, financing statement, regulatory agreement, guaranty of completion, and any and all other related certificates or agreements required in connection with the making of the CDA Loan. BE IT FURTHER RESOLVED, that MHP acknowledges and accepts the inclusion of a confession of judgment provision in the loan documents evidencing the DHCD Loan in favor of DHCD, including any promissory note, deed of trust, security agreement, financing statement, regulatory agreement, guaranty of completion, and any and all other related certificates or agreements required in connection with the making of the DHCD Loan. BE IT FURTHER RESOLVED, that MHP acknowledges and accepts the inclusion of a confession of judgment provision in the loan documents evidencing the DHCD Energy Loan in favor of DHCD, including any promissory note, deed of trust, security agreement, financing statement, regulatory agreement, repayment guaranty, and any and all other related certificates or agreements required in connection with the making of the DHCD Energy Loan.


MONTGOMERY HOUSING PARTNERSHIP, INC. 11-11 3

BE IT FURTHER RESOLVED, that MHP is hereby authorized to enter into, execute and deliver all guarantees in connection with the Investment including, but not limited to, the following listed documents and instruments: guaranty of completion, recapture guaranty, operating deficit guaranty, and right of first refusal.

BE IT FURTHER RESOLVED, that MHP is hereby authorized to acquire 79 shares of

common stock in the General Partner. BE IT FURTHER RESOLVED, that the President and Assistant Secretary of MHP be and hereby is authorized, empowered and directed, on behalf of MHP for its own account, to take such actions set forth above and take such further actions, and to execute such additional documents and instruments, as the person taking such actions, or executing such documents or instruments, may deem necessary or appropriate in connection with the matters authorized in the foregoing resolutions, and the signature of such President and Assistant Secretary on any documents or instrument or the performance of any such actions shall be conclusive evidence of such President and Assistant Secretary’s authority to take such actions or execute such documents or instruments on behalf of MHP. BE IT FURTHER RESOLVED, that that the President or Assistant Secretary is authorized to enter into a Development Services Agreement or other contracts with the Partnership to provide development services and in return for these development services, MHP will receive a development fee in the approximate amount of $995,000.00 to be invested back into the development of the Property.

BE IT FURTHER RESOLVED, that the President or Assistant Secretary is authorized to enter into a Management Agreement or other contracts with the Partnership to provide social services and management services, with final terms to be determined and approved by the President, on behalf of MHP. I HEREBY CERTIFY, that the foregoing Resolution was duly adopted by the Board of Directors of the Corporation and that I am Jill Goodrich, Assistant Secretary of the Corporation. By: ______________________________________ Jill Goodrich, Assistant Secretary



RESOLUTION 11-14


The Board of Directors of Montgomery Housing Partnership, Inc. (“MHP” or the “Corporation”), a Maryland not-for-profit corporation, hereby adopts by majority vote of the Board of Directors of said corporation on the _____ day of April, 2011, the following resolution: WHEREAS, MHP was organized for the purpose, among others, of developing and operating low-income housing; WHEREAS, the Corporation wishes to renovate Edinburgh House, a 45-unit multifamily apartment building located at 7513 Maple Avenue in Takoma Park, Maryland, for use as housing for low-income persons (the “Project”); WHEREAS, the Corporation has formed a limited partnership known as MHP Edinburgh House LP, (the “Company”), in which MHP EDH, Inc., a corporation controlled by MHP, is the general partner, for the purpose of carrying out the Project; WHEREAS, the Company has sought various sources of financing for the Project; WHEREAS, in addition to other financing, the Company proposes to obtain a loan to assist with the purchase and renovations from the Community Development Administration, a unit of the Maryland Department of Housing and Community Development in the approximate amount of $4,620,000.00 (the “CDA Loan”); WHEREAS, the Company further proposes to obtain a loan to assist with the purchase of the Property and the Project from the Maryland Department of Housing and Community Development (“DHCD”) from its Maryland Housing Rehabilitation Program in the amount of $500,000.00 (the “MHRP Loan”);

WHEREAS, in connection with the CDA Loan, certain additional security (the “Security”) is required to be provided to CDA and the Company has negotiated with Bank of America to provide a letter of credit to secure repayment of short term bonds providing a portion of the funds for the CDA Loan in the approximate amount of $2,000,000.00 and a negative

MONTGOMERY HOUSING PARTNERSHIP, INC 11-14 1 MHP Board PacketApril 27, 2011 of 65

arbitrage letter of credit in the approximate amount of $230,000.00 from Bank of America, N.A. (collectively, the “Letters of Credit”); WHEREAS, Bank of America requires that the Company’s obligations with respect to the Letters of Credit be secured by cash collateral in the approximate amount of $230,000.00 for the negative arbitrage letter of credit and in the approximate amount of $2,000,000 for the short term bonds to be pledged to and held by Bank of America as security for the Letters of Credit obligations (the “Security”);

WHEREAS, the Corporation has negotiated the use of additional financing provided by the BeSMART Program administered by the Maryland Department of Housing and Community Development to provide approximately $1,750,000.00 of the cash collateral required in connection with the short term bonds (the “DHCD Bridge Funding”) to be pledged to and held by Bank of America as security for the Company’s Letters of Credit obligations;

WHEREAS, the Company and the Corporation desire to deliver the Security to CDA to

enable CDA to make the CDA Loan for the Project;

WHEREAS, the issuer of the Security requires a guaranty from the Corporation to assure repayment of any funds advanced on behalf of the Company should the Company be unable to reimburse such advance;

WHEREAS, the Corporation deems it to be in the best interests of the Company to take all actions to facilitate the aforesaid loans by entering into any and all agreements with the Security, the issuer of the Letters of Credit and/or the DHCD Bridge Funding and by pledging cash collateral in an amount not to exceed $250,000.00 of MHP funds and $1,750,000.00 of the DHCD Bridge Funding as security for the Letters of Credit. NOW, THEREFORE, BE IT RESOLVED, that the Corporation is hereby authorized to enter into, execute and deliver any and all guaranty agreements, security agreements and documents, certifications, agreements and statements which may be necessary to obtain the Security for the Project. BE IT FURTHER RESOLVED, that the Corporation is hereby authorized to pledge the aforesaid cash collateral to Bank of America as security for the Letters of Credit and to deposit the same cash collateral into an account to be controlled by Bank of America. BE IT FURTHER RESOLVED, that the Corporation acknowledges and accepts the inclusion in the documents evidencing the Security of a confession of judgment clause in favor of the issuer of the Security. BE IT FURTHER RESOLVED, that the President or Assistant Secretary of the Corporation be and hereby is authorized, empowered and directed, on behalf of the Corporation for its own account, to take such actions set forth above and take such further actions, and to execute such additional documents and instruments, as the person taking such actions, or executing such documents or instruments, may deem necessary or appropriate in connection with


the matters authorized in the foregoing resolutions, and the signature of such President or Assistant Secretary on any documents or instrument or the performance of any such actions shall be conclusive evidence of such President or Assistant Secretary’s authority to take such actions or execute such documents or instrument on behalf of the Corporation. RESOLVED FURTHER, that any and all acts heretofore taken by the President or Assistant Secretary of the Corporation in connection with the matters authorized by the foregoing resolutions are hereby ratified, confirmed, adopted and approved by the Board of Directors of the Corporation.

CERTIFICATION I, Jill Goodrich, Assistant Secretary of Montgomery Housing Partnership, Inc., a Maryland non-profit organization, do hereby certify and declare that the foregoing is a full, true and correct copy of the resolution duly passed and adopted by the Board of Directors of said corporation, by written consent of all Directors of said corporation or at a meeting of said Board duly and regularly called, noticed and held on April ____, 2011, at which meeting a quorum of the Board of Directors was present and voted in favor of said resolutions; that said resolutions are now in full force and effect; that there is no provision in the Articles of Incorporation or Bylaws of said corporation, or any shareholder agreement, limiting the power of the Board of Directors of said corporation to pass the foregoing resolutions and that such resolutions are in conformity with the provisions of such Articles of Incorporation and Bylaws; and that no approval by the shareholders of, or of the outstanding shares of said Corporation is required with respect to the matters which are the subject of the foregoing resolutions. IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed the corporate seal of said corporation as of April ____, 2011.

____________________________________ Jill Goodrich, Assistant Secretary Montgomery Housing Partnership, Inc. A Maryland non-profit corporation



RESOLUTION 11-15 RESOLUTION OF THE BOARD OF DIRECTORS OF

MONTGOMERY HOUSING PARTNERSHIP, INC. The Board of Directors of Montgomery Housing Partnership, Inc. (the “Corporation”), a Maryland not-for-profit corporation, hereby adopts by majority vote of the Board of Directors of said Corporation on _______________, 2011, the following resolution: WHEREAS, the Corporation was established for the purposes of providing for the development or preservation of affordable housing in Montgomery County, Maryland; and

WHEREAS, in order for the Corporation to carry out its mission, the Corporation applied for a predevelopment loan from the Calvert Social Investment Foundation (“Calvert”) in the amount of $500,000, for a term of three years and at simple interest rate of approximately 4.5% per year (“the Loan”); and

WHEREAS, Calvert approved the Corporation’s request for the Loan; and

WHEREAS, the Board of Directors of the Corporation deems it to be in the best interests of the Corporation to take all actions to accept the Loan by entering into any and all agreements with Calvert. NOW, THEREFORE, BE IT RESOLVED, that the Corporation is hereby authorized to enter into, execute and deliver all loan documents and instruments related to receiving the Loan including, but not limited to, a note and a loan agreement;

BE IT FURTHER RESOLVED, that the President or Assistant Secretary of the Corporation is hereby authorized, on behalf of and in the name of the Corporation, to take such actions set forth above and to execute such additional documents and instruments, as the person taking such actions, or executing such documents or instruments, may deem necessary or appropriate in connection with the matters authorized in the foregoing resolution;

RESOLVED FURTHER, that any and all acts heretofore taken by the President or

Assistant Secretary of the Corporation in connection with the matters authorized by the foregoing resolution are hereby ratified, confirmed, adopted and approved by the Board of Directors of the Corporation.


Borrower Resolution (final)

2

IN WITNESS WHEREOF, this certification has been signed on behalf of the Corporation by its Assistant Secretary this ___ day of ______ 2011. _________________________________ Jill Goodrich, Assistant Secretary

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MEMORANDUM

To: MHP Board From: Real Estate Department Date: April 2011 Board Meeting RE: Calvert Predevelopment Loan & MHP Resolution 11-15 In the fall of 2010 MHP applied for a $500,000 predevelopment loan from the Calvert Foundation (Calvert). In late February 2011 Calvert’s loan committee approved the loan request. MHP staff is currently finalizing the promissory note with Calvert and anticipates closing on the loan in early May. The basic terms of the promissory note are as follows:

• Loan amount: $500,000 • Term: three years • Interest Rate: first year fixed at 4.5%; years 2 & 3: lender has right to reset the interest

rate at the end of each year (staff is negotiating to either first fix the rate for all years at 4.5% per year or have an objective standard for any change in years 2 & 3)

• Timing of Payments: paid semi-annually • Lender Origination Fee: $2,500 (50 basis points)

The funds will not be project specific. Therefore, staff will be able to loan them into any project. If feasible, we would plan to charge the project a higher rate than the Calvert loan rate in order to cover our interest costs when the money is not being deployed and in a bank earning only nominal interest. The attached MHP Resolution #11-15 gives MHP, Inc. the authority to execute the promissory note. MHP staff requests that the Board approves this resolution.



RESOLUTION 11-16 RESOLUTION OF THE BOARD OF DIRECTORS OF

MONTGOMERY HOUSING PARTNERSHIP, INC.

The Board of Directors of Montgomery Housing Partnership, Inc. (The "Corporation"), a Maryland non-profit corporation, hereby adopts by majority vote of the Board of Directors of said Corporation on April 27, 2011, the following resolution: WHEREAS, the Corporation is a nonprofit housing organization doing business in Montgomery County, Maryland; and WHEREAS, the Bylaws call for the Chair, Vice Chair, Treasurer and Secretary of the Board to serve as the Executive Committee of the Board. The Chair of the Board is also required to appoint up to two additional persons to the Executive Committee of the Board. NOW THEREFORE, BE IT RESOLVED, effective April 27, 2011, the Chair appoints Vicki Davis to serve on the Executive Committee of the Board until the next annual meeting. IN WITNESS WHEREOF, this certification has been signed on behalf of the Corporation by its Assistant Secretary this 27th day of April, 2011. _________________________________ Jill Goodrich, Assistant Secretary


BOARD MEETING NOTICE

MHP DRHC INC.

Date: Wednesday, April 27, 2011 Time: 8:00 p.m. Board Meeting Place: Pembridge Square Apartments Community Center 2315 Blueridge Avenue Wheaton, MD 20902 RSVP: Please call Michael Scheidt at 301-622-2400, extension 10 AGENDA

1. Resolution 11-02 – Distribution of Surplus Cash


RESOLUTION 11-02

RESOLUTION OF THE BOARD OF DIRECTORS OF

MHP DRHC, INC. The Board of Directors of MHP DRHC, Inc. (the "Corporation"), a Maryland non-profit corporation, hereby adopts by majority vote of the Board of Directors of said Corporation on April 27, 2011, the following resolution: WHEREAS, the Corporation is the owner of Dring’s Reach Apartments located at 3407 Robey Terrace, Silver Spring, Maryland (the “Property”); and WHEREAS, the Corporation’s fiscal year 2010 audit outlines surplus cash totaling $177,883, after payments of expenses, debt, asset management fees, deposits to the operating reserve, and payments of cash flow notes. NOW THEREFORE, BE IT RESOLVED, that the Corporation approves the distribution of $177,883 in surplus cash to Montgomery Housing Partnership for managing and overseeing the operations of the Property. IN WITNESS WHEREOF, this certification has been signed on behalf of the Corporation by its Assistant Secretary this 27th day of April 2011. _________________________________ Jill Goodrich, Assistant Secretary

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MHP PEMBRIDGE, INC.

Date: Wednesday, April 27, 2011 Time: 8:00 p.m. Board Meeting Place: Pembridge Square Community Center Pembridge Square Apartments 2315 Blueridge Avenue Wheaton, MD 20902 RSVP: Please call Michael Scheidt at 301-622-2400, extension 10

AGENDA

1. Resolution #11-02 – Surplus Cash Distribution


RESOLUTION 11-02

RESOLUTION OF THE BOARD OF DIRECTORS OF MHP PEMBRIDGE, INC.

The Board of Directors of MHP Pembridge, Inc. (the "Corporation"), a Maryland corporation, hereby adopts by majority vote of the Board of Directors of said Corporation on April 27, 2011, the following resolution: WHEREAS, the Corporation is the general partner of Pembridge Square Apartments L.P. (the “Owner”) which owns Pembridge Square Apartments located at 2315 Blueridge Avenue, Wheaton, Maryland (the “Property”); WHEREAS, the Property’s cash surplus as of December 31, 2010, has been disbursed in accordance with the Owner’s governing Partnership Agreement and cash in the amount of $103,778 still remains with the Owner. NOW THEREFORE, BE IT RESOLVED, that the Corporation, in its capacity as general partner of the Owner, approves the payment of an incentive asset management fee of $103,778 to Montgomery Housing Partnership, Inc. which has managed and overseen operations of this Property. IN WITNESS WHEREOF, this certification has been signed on behalf of the Corporation by its Assistant Secretary this 27th day of April, 2011. _________________________________ Jill Goodrich, Assistant Secretary

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MHP TOWN CENTRE, INC.

Date: Wednesday, April 27, 2011 Time: 8:00 p.m. Board Meeting Place: Pembridge Square Community Center 2315 Blueridge Avenue Wheaton, MD 20902 RSVP: Please call Michael Scheidt at 301-622-2400, extension 10 AGENDA

1. Resolution 11-02 – Surplus Cash Distribution


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RESOLUTION 11-02

RESOLUTION OF THE BOARD OF DIRECTORS OF MHP Town Centre, Inc.

The Board of Directors of MHP Town Centre, Inc. (the "Corporation"), a Maryland non-profit corporation, hereby adopts by majority vote of the Board of Directors of said Corporation on April 27, 2011, the following resolution: WHEREAS, the Corporation is the owner of Beall’s Grant Apartments located at 254 North Washington Street in Rockville, Maryland (the “Property”) ; and WHEREAS, the Corporation’s fiscal year 2010, audit outlines surplus cash totaling $86,802, after payments of expenses, debt, asset management fees, deposits to the operating reserve, and payments of cash flow notes. NOW THEREFORE, BE IT RESOLVED, that the Corporation approves the distribution of $86,802 in surplus cash to Montgomery Housing Partnership, Inc. for managing and overseeing the operations of the Property. IN WITNESS WHEREOF, this certification has been signed on behalf of the Corporation by its Assistant Secretary this 27th day of April 2011. _________________________________ Jill Goodrich, Assistant Secretary



MHP EDINBURGH HOUSE, INC.


1. Resolution 11-01 – Authorization of sale of Edinburgh House to MHP Edinburgh House LP


MHP Edinburgh House, Inc. 12200 Tech Road, Suite 250, Silver Spring, MD 20904 Phone: 301-622-2400 Fax: 301-622-2800

RESOLUTION 11-01

RESOLUTION OF THE BOARD OF DIRECTORS OF

MHP EDINBURGH HOUSE, INC. The Board of Directors of MHP Edinburgh House, Inc. (the “Corporation”), a Maryland corporation, in accordance with the Articles of Incorporation and Bylaws of the Corporation, hereby adopts by majority vote of the Board of Directors of said Corporation on the _____ day of April, 2011, the following resolution: WHEREAS, the Corporation was established exclusively for the purposes of owning and managing a 45-unit apartment facility located at 7513 Maple Avenue, Takoma Park, MD known as Edinburgh House Apartments (the “Project”) to preserve it for occupancy by income qualified persons as generally determined by reference to criteria and guidelines established by federal, state, and local government agencies; and WHEREAS, the Corporation proposes to enter into a Contract of Sale (the “Contract”) to sell the Project to MHP Edinburgh House LP (the “Limited Partnership”), whose sole general partner is MHP EDH, Inc. (the “GP”); and WHEREAS, the transfer will enhance the opportunity to maintain the Project for long term use as affordable housing; and WHEREAS, the Corporation wishes to loan the Limited Partnership approximately Two Million Two Hundred and Two Thousand and no/100 ($2,202,000.00) at 4.25% interest to be repaid from available cash flow (the “Seller Loan”) for the purchase of the Project; and WHEREAS, the Corporation and the GP are both affiliates of Montgomery Housing Partnership, Inc. whose purpose is to provide housing for persons of low and moderate income in Montgomery County, MD. NOW, THEREFORE, BE IT RESOLVED that the Corporation accepts the terms and conditions of the Contract to sell the Project to the Limited Partnership; and

BE IT FURTHER RESOLVED, that the Assistant Secretary or Vice President of the Corporation acting together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation to: 1) execute, seal, acknowledge, and deliver

MHP EDINBURGH HOUSE, INC. 11-01 1 MHP Board PacketApril 27, 2011 of 65

on behalf of the Corporation the Contract and thereafter a deed and all other documents, instruments, and affidavits in connection with the sale of the Project to the Limited Partnership and 2) execute all documents, instruments, and affidavits of every kind and description in connection with the Seller Loan.

I HEREBY CERTIFY, that the foregoing Resolution was duly adopted by the Board of Directors of the Corporation and that I am Jill Goodrich, Assistant Secretary of the Corporation. __________________________________ Jill Goodrich, Assistant Secretary

MHP EDINBURGH HOUSE, INC. 11-01 2 MHP Board PacketApril 27, 2011 of 65


MHP EDH, INC.


1. Resolution 11-03 – Enterprise Equity Investment 2. Resolution 11-04 – Purchase of Edinburgh House 3. Resolution 11-05 – Bank of America Letter of Credit 4. Resolution 11-06 – Issue Stock and Amend By-Laws


MHP EDH, Inc. 12200 Tech Road, Suite 250, Silver Spring, MD 20904 Phone: 301-622-2400 Fax: 301-622-2800

RESOLUTION 11-03

RESOLUTIONS OF THE BOARD OF DIRECTORS OF MHP EDH, INC.

The Board of Directors of MHP EDH, Inc. (the “Corporation”), a Maryland corporation, hereby adopts by majority vote of the Board of Directors of said corporation on the ____ day of April, 2011, the following resolution: WHEREAS, MHP Edinburgh House LP (the “Partnership”), was organized for the purpose, among others, of developing and operating low-income housing; WHEREAS, the Partnership wishes to own and operate a project known as the Edinburgh House Apartments, consisting of 45 units of rental housing in one building located at 7513 Maple Avenue, Takoma Park, MD, constructed as housing for low-income persons (the “Project”); WHEREAS, the Corporation is the general partner of the Partnership and was also organized for the purpose, among others, of developing and operating low-income housing; WHEREAS, the Partnership wishes to obtain an equity investment from an affiliate of Enterprise Community Investment, Inc. (“Enterprise”), in the approximate amount of $1,800, 000.00 (the “Investment”); WHEREAS, as part of the Investment, Enterprise shall require that the Partnership Agreement for the Partnership be amended and restated in its entirety to reflect the terms of the Investment (the “Amended Agreement”); WHEREAS, as part of the Investment, Enterprise requires that the Partnership enter into various documents relating to the development and/or operation of the Project (the “Syndication Documents”); WHEREAS, the Board of Directors of the Corporation deems it to be in the best interests of the Corporation to take all actions necessary to facilitate the Investment in the Partnership by Enterprise by entering into any and all agreements with Enterprise and/or the Partnership, on its own account, and as general partner of the Partnership, and to take any and all further actions to facilitate the Investment in the Partnership by Enterprise; WHEREAS, the Corporation has 100 shares of common stock;

MHP EDH, INC. 11-03 1 MHP Board PacketApril 27, 2011 of 65

WHEREAS, to avoid reallocation of the tax credits, the Corporation wishes to sell 79 shares of common stock to Montgomery Housing Partnership, Inc. (“MHP”) and 21 shares of stock to an unrelated private or non-profit company to be determined at the value of $1.00 per share. NOW, THEREFORE, BE IT RESOLVED, that the Corporation is hereby authorized to enter into, execute and deliver the following listed Syndication Documents and instruments; 1. Amended and Restated Agreement of Limited Partnership of MHP Edinburgh House LP 2. Unconditional Construction Completion Guaranty Agreement; 3. Right of First Refusal; 4. Partnership Management Services Agreement; 5. Guaranty Agreement; 6. Development Services Agreement; and 7. Such other documents as required in connection with the closing of the Investment by

Enterprise

BE IT FURTHER RESOLVED, that the Vice President or Assistant Secretary of the Corporation be and hereby is authorized, empowered and directed, to take such actions set forth above and take such further actions, and to execute such additional documents and instruments, as the person taking such actions, or executing such documents or instruments, may deem necessary or appropriate in connection with the matters authorized in the foregoing resolutions, and the signature of such Vice President or Assistant Secretary on any documents or instrument or the performance of any such actions shall be conclusive evidence of such Vice President or Assistant Secretary’s authority to take such actions or execute such documents or instrument on behalf of the Corporation for its own account and/or as a general partner of the Partnership; and RESOLVED FURTHER, that any and all acts heretofore taken by the Vice President or Assistant Secretary of the Corporation in connection with the matters authorized by the foregoing resolutions are hereby ratified, confirmed, adopted and approved by the Board of Directors of the Corporation; and RESOLVED FURTHER, that the Corporation is hereby authorized to sell 79 shares of common stock to MHP and 21 shares of common stock to an unrelated private or non-profit to be determined.

CERTIFICATION I, Jill Goodrich, Assistant Secretary of MHP EDH, Inc., a Maryland corporation, do hereby certify and declare that the foregoing is a full, true and correct copy of the resolution duly passed and adopted by the Board of Directors of said corporation, by written consent of all Directors of said corporation or at a meeting of said Board duly and regularly called, noticed and held on April ____, 2011, at which meeting a quorum of the Board of Directors was present and voted in favor of said resolutions; that said resolutions are now in full force and effect; that there is no provision in the Articles of Incorporation or Bylaws of said corporation, or any shareholder agreement, limiting the power of the Board of Directors of said corporation to pass the foregoing resolutions and that such resolutions are in conformity with the provisions of such Articles of


Incorporation and Bylaws; and that no approval by the shareholders of, or of the outstanding shares of said Corporation is required with respect to the matters which are the subject of the foregoing resolutions. IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed the corporate seal of said corporation as of April ____, 2011.

______________________________________ Jill Goodrich, Assistant Secretary MHP EDH, Inc., a Maryland corporation



RESOLUTION 11-04

RESOLUTION OF THE BOARD OF DIRECTORS OF MHP EDH, INC.

The Board of Directors of MHP EDH, Inc. (the "Corporation"), a Maryland corporation, hereby adopts by majority vote of the Board of Directors of said Corporation on April ____, 2011, the following resolution: WHEREAS, MHP Edinburgh House LP (the “Partnership”), was organized for the purpose, among others, of developing and operating low-income housing; WHEREAS, the Partnership wishes to own and operate a project known as the Edinburgh House Apartments, consisting of 45 units of rental housing in one building located at 7513 Maple Avenue, Takoma Park, MD, constructed as housing for low-income persons (the “Project”); WHEREAS, the Corporation is the general partner of the Partnership and was also organized for the purpose, among others, of developing and operating low-income housing;

WHEREAS, the Partnership proposes to enter into a Contract of Sale with the seller, MHP Edinburgh House, Inc. (the “Seller”) to purchase the Property (the “Contract”), for use as housing for low-income persons (the “Project”); WHEREAS, the Partnership has secured various sources of financing for the Project;

WHEREAS, the Partnership desires to accept the following two loans from the Community Development Administration (CDA) of Maryland Department of Housing and Community Development’s New Issue Bond Program to acquire and renovate the Project: a permanent loan in the approximate amount of $2,620,000.00 and a short-term loan in the approximate amount of $2,000,000.00 (the “CDA Loans”);

WHEREAS, the Partnership desires to execute a note to the Seller, in the approximate

amount of $2,202,000.00 (the “Seller Loan”), the proceeds of which are to be used by the Partnership to provide acquisition financing on the Project;

WHEREAS, the Partnership desires to accept a Maryland Housing Rehabilitation

Program loan from the Maryland Department of Housing and Community Development

MHP EDH, INC 11-04 1 MHP Board PacketApril 27, 2011 of 65

(“DHCD”) in the approximate amount of $500,000.00 (the “MHRP Loan”), the proceeds of which are to be used by the Partnership to provide acquisition and renovation financing on the Project; WHEREAS, the Partnership desires to accept a BeSmart energy loan through DHCD with final terms to be approved by the President or Vice President of the Corporation on behalf of the Corporation, in the approximate amount of $312,500.00 (the “DHCD Energy Loan”), the proceeds of which are to be used by the Partnership to provide energy efficient renovations to the Project;

WHEREAS, the Partnership desires to accept a HOME Program loan from Montgomery

County Department of Housing and Community Affairs (“DHCA”) in the approximate amount of $685,000.00 (the “County HOME Loan”), the proceeds of which are to be used by the Partnership to provide acquisition and renovation financing on the Project;

WHEREAS, the Partnership desires to accept a Housing Initiative Fund loan from DHCA

in the approximate amount of $1,159,105.00 (the “County HIF Loan”), the proceeds of which are to be used by the Partnership to provide acquisition and renovation financing on the Project;

WHEREAS, the Partnership desires to accept a bridge loan from DHCA in the

approximate amount of $500,000.00 (the “County Bridge Loan”), the proceeds of which are to be used by the Partnership to provide acquisition and renovation financing on the Project;

WHEREAS, the Partnership desires to assume a loan from Montgomery Housing

Partnership, Inc. (“MHP”) in an amount not to exceed $400,000.00 (the “MHP Loan”), the proceeds of which are to be used by the Partnership to provide acquisition and renovation financing on the Project;

WHEREAS, the Partnership desires to accept a loan from MHP in the approximate

amount of $50,000 from a TD Bank grant award to MHP (the “TD Bank Loan”), the proceeds of which are to be used by the Partnership to provide acquisition and renovation financing on the Project;

WHEREAS, the Corporation, on behalf of the Partnership desires to accept the CDA Loans, the Seller Loan, the MHRP Loan, the DHCD Energy Loan, the County HOME Loan, the County HIF Loan, the County Bridge Loan, the MHP Loan, and the TD Bank Loan (collectively, the “Loans”) and utilize the funds received to provide assistance to the Partnership for the Project;

WHEREAS, the Board of Directors of the Corporation deems it to be in the best interests of the Corporation to take all actions to facilitate the aforesaid Loans by entering into any and all agreements with the lenders on behalf of the Partnership;

WHEREAS, the Company has requested that Equity Management II, LLC provide

certain property management services to the Project;


WHEREAS, a management agreement with Equity Management II, LLC, needs to be executed before closing on the acquisition of the Property.

NOW, THEREFORE, BE IT RESOLVED that the Corporation, acting on behalf of the

Partnership, accepts the Contract and the terms and conditions of the Loans; and BE IT FURTHER RESOLVED, that the Corporation, on behalf of the Partnership, is

hereby authorized to execute any and all documents, settlement statements, deeds, certificates and statements necessary to consummate the Contract and acquire the Property; and

BE IT FURTHER RESOLVED, that the Vice President or Assistant Secretary acting

together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation, and under the Corporation seal to execute, seal, acknowledge, and deliver to CDA all documents, instruments, and affidavits of every kind and description on behalf of the Partnership in connection with the CDA Loans including, but not limited to a Promissory Note, a Loan Agreement, a Regulatory Agreement, a Deed of Trust and a Financing Statement encumbering the Project as security for repayment of the loan, and such other documents evidencing and securing the CDA Loans as may be required by CDA; and


together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation, and under the Corporation seal to execute, seal, acknowledge, and deliver to the Seller all documents, instruments, and affidavits of every kind and description on behalf of the Partnership in connection with the Seller Loan including, but not limited to a Promissory Note, a Loan Agreement, a Deed of Trust and a Financing Statement encumbering the Project as security for repayment of the loan, and such other documents evidencing and securing the Seller Loan as may be required by the Seller.


together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation, and under the Corporation seal to execute, seal, acknowledge, and deliver to DHCD all documents, instruments, and affidavits of every kind and description on behalf of the Partnership in connection with the MHRP Loan including, but not limited to a Promissory Note, a Regulatory Agreement, a Loan Agreement, a Deed of Trust and a Financing Statement encumbering the Project as security for repayment of the loan, and such other documents evidencing and securing the MHRP Loan as may be required by DHCD.


together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation, and under the Corporation seal to execute, seal, acknowledge, and deliver to DHCD all documents, instruments, and affidavits of every kind and description on behalf of the Partnership in connection with the DHCD Energy Loan including, but not limited to a Promissory Note, a Regulatory Agreement, a Loan Agreement, a Deed of Trust and a Financing Statement encumbering the Project as security for repayment of the loan, and such other documents evidencing and securing the DHCD Energy Loan as may be required by DHCD or any affiliated entity.


BE IT FURTHER RESOLVED, that the Corporation acknowledges and accepts the

inclusion of a confession of judgment provision in the loan documents evidencing the CDA Loans or MHRP Loan in favor of DHCD or CDA, as the case may be, included in any promissory note, deed of trust, security agreement, financing statement, regulatory agreement, and any and all other related certificates or agreements required in connection with the making of such loans.


together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation, and under the Corporation seal to execute, seal, acknowledge, and deliver to DHCA all documents, instruments, and affidavits of every kind and description on behalf of the Partnership in connection with the DHCA HOME Loan including, but not limited to a Promissory Note, a Loan Agreement, a Deed of Trust and a Financing Statement encumbering the Project as security for repayment of the loan, and such other documents evidencing and securing the DHCA HOME Loan as may be required by DHCA.


together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation, and under the Corporation seal to execute, seal, acknowledge, and deliver to DHCA all documents, instruments, and affidavits of every kind and description on behalf of the Partnership in connection with the DHCA HIF Loan including, but not limited to a Promissory Note, a Loan Agreement, a Deed of Trust and a Financing Statement encumbering the Project as security for repayment of the loan, and such other documents evidencing and securing the DHCA HIF Loan as may be required by DHCA.


together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation, and under the Corporation seal to execute, seal, acknowledge, and deliver to DHCA all documents, instruments, and affidavits of every kind and description on behalf of the Partnership in connection with the County Bridge Loan including, but not limited to a Promissory Note, a Loan Agreement, a Deed of Trust and a Financing Statement encumbering the Project as security for repayment of the loan, and such other documents evidencing and securing the County Bridge Loan as may be required by DHCA.


together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation, and under the Corporation seal to execute, seal, acknowledge, and deliver to MHP all documents, instruments, and affidavits of every kind and description on behalf of the Partnership in connection with the MHP Loan including, but not limited to a Promissory Note, and such other documents evidencing and securing the MHP Loan as may be required by MHP.


together or either one acting alone, are authorized and directed on behalf of and in the name of the Corporation, and under the Corporation seal to execute, seal, acknowledge, and deliver to MHP all documents, instruments, and affidavits of every kind and description on behalf of the


Partnership in connection with the TD Bank Loan including, but not limited to a Promissory Note, and such other documents evidencing and securing the TD Bank Loan as may be required by MHP.

BE IT FURTHER RESOLVED, that the Vice President and Assistant Secretary of the Corporation are hereby further authorized and directed to perform all such acts, sign all such agreements and other papers, executed all such transfers, certificates and conveyances and do such other matters and things which seem proper which may be required in connection with the Loans. BE IT FURTHER RESOLVED, that the President or Vice President are authorized to enter into a contract with Equity Management II, LLC to provide such services and in return for these services, the Corporation will provide a property management fee, as to be determined.

BE IT FURTHER RESOLVED, that the Corporation ratifies any and all actions taken previously by the Partnership, in connection with the acquisition of the Project, pursuing the Loans to finance acquisition and rehabilitation of the Project, and other agreements necessary to ensure operation of the Project and all other actions taken incident thereto.

I hereby certify that the foregoing resolutions were approved by majority vote of Board of Directors of MHP EDH, Inc. on the _____ day of April, 2011. By:______________________________________ Jill Goodrich, Assistant Secretary



RESOLUTION 11-05


The Board of Directors of MHP EDH, Inc. (the "Corporation"), a Maryland corporation, hereby adopts by majority vote of the Board of Directors of said Corporation at a meeting held on April _____, 2011, the following resolution:

WHEREAS, the Corporation was established exclusively for the purposes of serving as general partner of MHP EDINBURGH HOUSE LP (The “Company”) which will provide for the development or preservation of affordable housing in Montgomery County, Maryland for needy persons as generally determined by reference to criteria and guidelines established by federal, state, and local government agencies; and WHEREAS, the Company was organized by MHP to own, renovate, operate, manage and lease a rental apartment facility located at 7513 Maple Avenue in Takoma Park, Maryland and known as Edinburgh House Apartments (the “Property”); and

WHEREAS, the Company proposes to enter into a Contract of Sale (the “Contract”) with MHP Edinburgh House, Inc., to purchase and operate the Property for use as housing for low-income persons (the “Project”); and

WHEREAS, the Company has sought various sources of financing for the Project; and

WHEREAS, the Company proposes to obtain a loan to assist with the purchase and renovations from the Community Development Administration, a unit of the Maryland Department of Housing and Community Development in the approximate amount of $4,620,000.00 (the “CDA Loan”); and

WHEREAS, the Company further proposes to obtain a loan to assist with the purchase from the Maryland Department of Housing and Community


Development from its Maryland Housing Rehabilitation Program in the amount of $500,000.00 (the MHRP Loan”); and

WHEREAS, in connection with the CDA Loan, certain additional security (the “Security”) is required to be provided to CDA and the Company has negotiated with Bank of America to provide a letter of credit for short term bonds which provided the funds for a portion of the CDA Loan in the approximate amount of $2,000,000.00 and a negative arbitrage letter of credit in the approximate amount of $230,000.00 from Bank of America, N.A. (collectively, the “Letters of Credit”); and

WHEREAS, the Board of Directors of the Company deem it to be in the

best interest of the Company to take all actions to facilitate the aforesaid loans by entering into any and all agreements with the lenders and the issuer of the Letters of Credit. NOW, THEREFORE, BE IT RESOLVED that the Corporation is and shall be authorized to execute the documents necessary to obtain the Letters of Credit on behalf of the Company. BE IT FURTHER RESOLVED, that MHP EDH, Inc. as general partner of the Company acting through its Vice President or Assistant Secretary is authorized and directed on behalf of and in the name of the Company to execute the request for the Letters of Credit and execute any reimbursement agreements, pledge agreements, security agreements or other documents necessary to obtain the Letters of Credit. BE IT FURTHER RESOLVED, that the Corporation acknowledges and accepts the inclusion in the documents evidencing the Security of a confession of judgment clause in favor of the issuer of the Security.

BE IT FURTHER RESOLVED, that the Vice President or Assistant Secretary of MHP EDH, Inc., as general partner of the Company, be and hereby is authorized, empowered and directed, on behalf of the Company for its own account, to take such actions set forth above and take such further actions, and to execute such additional documents and instruments, as the person taking such actions, or executing such documents or instruments, may deem necessary or appropriate in connection with the matters authorized in the foregoing resolutions, and the signature of such Vice President or Assistant Secretary on any documents or instrument or the performance of any such actions shall be conclusive evidence of such Vice President or Assistant Secretary’s authority to take such actions or execute such documents or instrument on behalf of the Corporation for the Company.


BE IT FURTHER RESOLVED that the Vice President and Assistant Secretary of the Corporation are hereby further authorized and directed to perform all such acts, sign all such agreements and other papers, execute all such transfers, certificates and conveyances and do such other matters and things which seem proper which may be required in connection with the Loans and/or the Letters of Credit.

BE IT FURTHER RESOLVED that all previous actions taken or documents executed and delivered by the Vice President and the Assistant Secretary on behalf of the Corporation in connection with authorizing or operating or pursuing the Loans and/or the Letters of Credit by the Company in any capacity are hereby ratified and approved. I hereby certify that the foregoing resolutions were approved at a duly conducted meeting of MHP EDH, Inc. on the ___ day of April, 2011. By: ______________________________________

Jill Goodrich, Assistant Secretary


MHP EDH, INC. 12200 Tech Road, Suite 250, Silver Spring, MD 20904 Phone: 301-622-2400 Fax: 301-622-2800

RESOLUTION 11-06


The Board of Directors of MHP EDH, Inc. (the “Corporation”), a Maryland corporation, hereby adopts by two-thirds vote of the Board of Directors of said corporation on the ____ day of April, 2011, the following resolution: WHEREAS, MHP Edinburgh House LP (the “Partnership”), was organized for the purpose, among others, of developing and operating low-income housing; WHEREAS, the Partnership wishes to own and operate a project known as the Edinburgh House Apartments, consisting of 45 units of rental housing in one building located at 7513 Maple Avenue, Takoma Park, MD, constructed as housing for low-income persons (the “Project”); WHEREAS, the Corporation is the general partner of the Partnership and was also organized for the purpose, among others, of developing and operating low-income housing; WHERAS, it is in order for the Corporation to issue shares in the Corporation; WHEREAS, to avoid reallocation of the tax credits, the Corporation wishes to sell 79 shares of common stock to Montgomery Housing Partnership, Inc. (“MHP”) and 21 shares of stock to an unrelated private or non-profit company to be determined at the value of $1.00 per share; WHEREAS, the Board of Directors of the Corporation adopted corporate bylaws by a unanimous vote on January 25, 2011 (“Original Bylaws”); and WHEREAS, the Corporation seeks to amend the Original Bylaws and adopt the First Amendment to the Bylaws of the Corporation, attached hereto as Exhibit A, prepared by counsel and exhibited at the meeting of the Board of Directors of the Corporation (“First Amendment to the Bylaws”). NOW, THEREFORE, BE IT RESOLVED, that the Corporation is authorized and directed to issue one hundred (100) shares of stock with a value of $1.00 per share, and the Corporation is further authorized and directed to sell 79 of such shares to MHP and the remaining 21 shares to an unrelated private or non-profit company to be determined.

MHP EDH, INC. 11-06 1


BE IT FURTHER RESOLVED, that the First Amendment to the Bylaws is hereby adopted and shall be filed in the minute book. IN WITNESS WHEREOF, this certification has been signed on behalf of the Corporation by its Assistant Secretary this ___ day of April, 2011




EXHIBIT A

FIRST AMENDMENT TO BYLAWS

This First Amendment to Bylaws of MHP EDH, Inc. amends those certain Bylaws adopted by MHP EDH, Inc. as of January 25, 2011 (the "Bylaws"). The Bylaws are hereby amended as follows:

Section 3.04 (Election) is hereby deleted in its entirety and replaced with the following:

"The initial Board of Directors shall consist of the individuals named in the Articles of Incorporation who shall serve until their successors are designated as provided herein. After the organizational meeting, and continuing annually thereafter, the Directors of the Corporation shall be elected or appointed by a majority vote of the shareholders. Directors shall hold office until the next annual meeting and until their successors are elected and qualify."

Section 3.06 (Removal) is hereby deleted in its entirety and replaced with the following:

"Any Director may be removed from office at any time, with or without cause, by a majority vote of the shareholders."

Section 3.07 (Vacancies) is hereby deleted in its entirety and replaced with the following:

"In the event of the death, removal from office, or resignation of a Director, a successor to fill such vacancy shall be designated by a majority vote of the shareholders. A Director elected to fill a vacancy shall serve for the unexpired portion of the term. In the case of an increase in the number of Directors, a Director shall hold office until the next election of Directors."

The foregoing was adopted as the First Amendment to Bylaws of MHP EDH, Inc., the _____ day of April, 2011.




UNAUDITEDINTERNAL USE ONLY

Prior Year 2010 Total 2011

ACTUALS BUDGET 03-11 VARIANCE ACTUALS BUDGET REVENUES (Unrestricted)

Development fees 97,997$ 94,000$ 3,997$ 47,657$ 1,409,000$ Government Contract Income 56,000 55,000 1,000 52,330 219,600 Donations and Grants 157,274 47,100 110,174 157,843 395,500 Fees from Affiliated Entities 135,126 137,470 (2,344) 114,859 1,373,340 Special events 4,125 7,000 (2,875) 132,855 35,000 Gain from debt forgiveness 1,900 2,400 (500) 51,650 Interest and investment income 8,301 10,591 (2,290) 738 67,000 Other income 115 400 (285) - 5,200 TOTAL REVENUES 460,838$ 353,961$ 106,877$ 557,932 3,504,640

EXPENSESSalaries and Benefits 527,377$ 495,059 (32,318) 507,311 2,084,015 Community (non-salaried staff included) 29,314 42,573 13,259 32,582 170,300 Program services 54,134 30,825 (23,309) 36,258 102,800 Fundraising 377 4,800 4,423 82,738 22,000 Overhead / Facility costs 78,818 83,253 4,435 48,584 384,320 TOTAL EXPENSES 690,020 656,510 (33,510) 707,473 2,763,435

Increase in Unrestricted Net Assets Acc (229,182)$ (302,549)$ 73,367$ ($149,541) 741,205$

Statement of Revenues and ExpensesFor the 1 Month Ending Mar. 31, 2011

Year 2011 To Date

Montgomery Housing Partnership, Inc.


UNAUDITED UNAUDITEDINTERNAL

U S E

ASSETS:Cash and cash equivalents (see attached detail) 4,473,179$ Cash (Restricted) 0Accounts receivable 316,750.00Prepaid expenses and deposits 17,818Furniture, equipment, improvements 114,596 Less: Accumulated depreciation 92,698 Net fixed assets 21,898Loans to affiliates - NRC revolving funds 518,672Notes receivable - Affiliates NRC funds 2,340,168Deferred Development fees receivable 703,049Notes receivable and subsidiary advances 1,373,014 TOTAL ASSETS 9,764,548$

LIABILITIES and NET ASSETSAccounts payable 23,104$ Accrued payroll and payroll costs/benefits 42,021Deferral of rents payable 42,372Notes payable 75,000Notes payable - Forgivable 12,214 Total liabilities 194,711

Unrestricted Net assets 6,477,704$ NeighborWorks Unrestricted Net Assets 848,547NeighborWorks Permanent Restricted Net Assets 2,177,420Temporary Restricted Net Assets 66,166 Total net assets 9,569,837

TOTAL LIABILITIES and NET ASSETS 9,764,548$

Montgomery Housing Partnership, Inc.Summary Balance Sheet

March 31, 2011


2011 Grant Proposals

Name Funding Priority

Previous Support Ask Amount Due Date Status Award Amount

Date Received Reports

Bank of America NEI Capacity Applications 200,000.00$ JuneEnterprise Capacity 100,000.00$ by invitationNeighborWorks Organizational Underwriting General $112,800 in 10 150,000.00$ OctoberBank of America Foundation General $30,000 in '09 40,000.00$ rollingCapital One General $20,000 in '10 25,000.00$ July

Total Possible 515,000.00$

Community Foundation for Montgomery County CL $5,000 in 10 5,000.00$ August LOIMead Family Foundation CL New 5,000.00$ by invitationMeyer Foundation CL $20,000 in 10 25,000.00$ Feb-June

Cafritz Foundation CL Applications 20,000.00$ March July November

Saint Mark's Presbyterian Church CL $5,000 in '10 5,000.00$ DecemberCDBG CL Applications 45,000.00$ Wachovia Foundation CL $20,000 in 09 20,000.00$ rolling

Fannie Mae Help the Homeless CL $40,000 in '10 5,000.00$ AprilFreddie Mac Foundation CL Applications 50,000.00$ September

United Way Community Impact CL Applications 10,000.00$ AprilWeinberg Foundation CL 20,000.00$ rollingExcel Beyond the Bell CL--teen $23,250 in 10 20,000.00$ April submitted 20,000.00$ County Council Grant Homework 50,000.00$ January 28, 2011 submittedCounty Exec Grant Homework 50,000.00$ January 28, 2011 submitted 25,000.00$ recommendationTotal Possible 280,000.00$

TD Bank RED Applications 20,000.00$ SeptemberMAHT RED $25,000 in 10 150,000.00$ March submittedCiti Foundation RED $25,000 in '10 25,000.00$ MarchHome Depot Foundation RED Applications March-July-SeptNeighborWorks Line of Business RED Oct-11 650,000.00$

Total Possible 845,000.00$ MHP Board PacketApril 27, 2011 of 65

Fundraising Goals & Achievements 2011 For month ending March 31, 2011

2009 Goal 2009 Actual 2010 Goal 2010 Actual 2011 Goal 2011 ActualIndividual Giving Major Gifts ($1,000+) 37,000 27,150 30,000 35,700 60,000 13,027 Individual Gifts (< $1,000) 13,000 14,145 20,000 13,151 24,500 2,523.82 Workplace Giving 5,700 8,136 7,000 3,551 3,500 1,246.32Subtotal $55,700 $49,431 $57,000 $52,402 $88,000 $16,797.14

Corporate Giving Corporate Sponsor 55,000 10,000 35,000 66,500 Corporate gifts – non-sponsor 2,000 9,800 5,000 26,500 500 163.20 Corporate gifts – tax credits 8,500 11,000 11,000 6,000 3,000 In Kind Gifts 31,338 34,262Subtotal $65,500 $62,138 $51,000 $66,762 $70,000 $163.20

Organizations Faith-based Organizations 8,000 6,240 5,000 5,560 6,500 Civic Organizations 1,000 400 500 1,191 1,000 1,050Subtotal $9,000 $6,640 $5,500 $6,751 $7,500 $1,050

Foundations Fannie Mae 50,000 38,508 35,000 39,431 5,000 33,514 Foundation grants-programs 180,000 227,900 250,000 489,600 520,000 105,750Subtotal $230,000 $266,408 $285,000 $529,031 $525,000 $139,264

Government Government contracts 250,000 311,164 250,000 154,997 220,000 Government grants - Debt Draw 180,000 241,190 180,000 195,585 160,000Subtotal $430,000 $552,354 $430,000 $350,582 $380,000 $0

Events Community Life 1,635 2,000 Golf Tournament 22,000 35,151 15,000 26,720 40,000 4,125 Gala 60,000 99,325 123,175 152,655Subtotal $82,000 $134,476 $138,175 $181,010 $42,000 $4,125

TOTAL $872,200 $1,071,448 $966,675 $1,186,538 $1,112,500 $161,399.38

NW Capital Funding 2009 Actual 2010 Goal 2010 Actual70,000 $300,000 $639,500


BOARD CALENDAR OF EVENTS April 2011

April 27th MHP Board Meeting 6:30pm at Pembridge Square Apts. Community Center, 2315 Blueridge Avenue, Wheaton. RSVP to Michael (301) 622-2400 x10. [email protected].

May 2nd MHP Annual Norman Christeller Classic, Hampshire

Greens Golf Course, 10:00am registration, 12:00 tee-off Contact Lesia Bullock 301-622-2400 x38

[email protected] May 24th MHP Board and Committee Meetings 6:30pm at

Pembridge Square Apts. Community Center, 2315 Blu-eridge Avenue, Wheaton. RSVP to Michael (301) 622-2400 x10. [email protected]

June 1st Amherst Square Play and Learn Circle Graduation,

10:30 and 1:30, contact Cleydi Pacheco, 301-622-2400 x21, [email protected]

June 2nd Great Hope Homes Play and Learn Circle Gradua-

tion, 10:30 to 11:30, contact Gloria Castro, 301-622-2400 x18, [email protected]

June 3rd Gilbert Highlands Play and Learn Circle Gradua-

tion, 10:30 to 12:00, contact Nora Ortiz, 301-622-2400 x37, [email protected]

June 28th MHP Executive Committee Meeting, time and loca-

tion TBA. July 26th MHP Board Meeting 6:30pm at Pembridge Square

Apts. Community Center, 2315 Blueridge Avenue, Wheaton. RSVP to Michael (301) 622-2400 x10. [email protected].
