Agmt 2006 Mercy Housing California XXXIII (4)

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(50%) or more of the ownership interests in an entity, or in the case of a not-for-profit entity, the right to appoint fifty percent (50%) or more of such entity's board of directors. 7.4 Requirements for Proposed Transfers. The Agency may, in the exercise of its sole discretion, approve a transfer of this Agreement, the leasehold estate in the Property or portion thereof only if all of the following requirements are met (provided however, the requirements of this Section 7.4 shall not apply to Transfers described in clauses (i) through (iv) of Section 7.3): a. The proposed transferee demonstrates to the Agency's satisfaction that it has the qualifications, experience and financial resources necessary and adequate as may be reasonably determined by the Agency to competently complete rehabilitation of the Project and to otherwise fulfill the obligations undertaken by the Developer under this Agreement. b. The Developer and the proposed transferee shall submit for Agency review and approval all instruments and other legal documents proposed to effect any Transfer of this Agreement, the Property or interest therein together with such documentation of the proposed transferee's qualifications and development capacity as the Agency may reasonably request. c. The Developer and the proposed transferee shall submit for Agency review and approval copies of the proposed transferee's corporate formation and governance documents (transferee's articles incorporation and bylaws; LP-1 and partnership agreement; or articles of organization and operating agreement, as applicable). d. Pursuant to an assignment and assumption agreement acceptable to the Agency, the proposed transferee shall expressly assume all of the rights and obligations of the Developer under the Agency Documents arising after the effective date of the Transfer and all obligations of Developer arising prior to the effective date of the Transfer (unless Developer expressly remains responsible for such obligations). e. The Transfer shall be effectuated pursuant to a written instrument satisfactory to the Agency in form recordable in the Official Records of Alameda County. Consent to any proposed Transfer may be given by the Agency's Executive Director unless the Executive Director, in his or her discretion, refers the matter of approval to the Agency's governing board. 7.5 Effect of Transfer without Agency Consent. 7.5.1 In the absence of specific written agreement by the Agency, no Transfer by Developer shall be deemed to relieve the Developer or any other party from any obligation under this Agreement. 7.5.2 If, in violation of this Agreement, the Developer Transfers all or any part of Developer's leasehold interest in the Property or the improvements thereon prior to the later of the recordation of the Certificate of Completion for the Project or the expiration of the term of the Regulatory Agreement, the Agency shall be entitled to receive from Developer the amount by which the consideration payable for such Transfer exceeds the sum of the costs incurred by Developer in connection with the improvement and development of the Property, including 803698-6 24