92476-A Escrow Agreement Additional Contribution by Sponsors

Escrow Agreement
Additional Contribution
by Sponsors

U.S. Department of Housing
and Urban Development
Office of Housing
Federal Housing Commissioner

OMB No. 2502-0470 (exp. 11/30/2006)

Public reporting burden for this collection of information is estimated to average 30 minutes per response, including the time for reviewing instructions, searching
existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Send comments regarding this burden
estimate or any other aspect of this collection of information, including suggestions for reducing this burden, to the Reports Management Officer, Paperwork
Reduction Project (2502-0470), Office of Information Technology, U.S. Department of Housing and Urban Development, Washington, D.C. 20410-3600. This agency
may not collect this information, and you are not required to complete this form, unless it displays a currently valid OMB control number.
Do not send this form to the above address.
This information collection is necessary to ensure that viable projects are developed. It is important to obtain information from applicants to assist HUD in determining
if nonprofit organizations initially funded continue to have the financial and administrative capacity needed to develop a project and that the project design meets the
needs of the residents. The Department will use this information to determine if the projects meet statutory requirements, ensuring the continued marketability of the
projects. This information is required in order to obtain benefits. This information is considered non-sensitive and no assurance of confidentiality is provided.

Whereas, _____________________________________________________________________________________________________________________
and __________________________________________________________________________________________________________________________
are sponsors of a project located in ____________________________________________________________________________, identified as FHA Project
No. _______________________________, which project has been, is being, or will be, constructed from the proceeds of a mortgage (or deed of trust) from

to ____________________________________________________________________________________________________________________________ ,
with respect to which mortgage Federal Housing Commissioner has issued a commitment to insure, and without which insurance financing of the construction
of the project as proposed by the sponsors could not be obtained, and
Whereas, said commitment is conditioned upon assurance that additional funds be made available for project purposes, primarily for the absorption of any deficit
resulting from the operation of the project during the initial period of occupancy;
Now, therefore this agreement witnesseth:
1. That the sponsors have deposited with ________________________________________________________________________, Depository,
(a) in cash,
(b) by an unconditional irrevocable letter of credit issued to Depository by a banking institution,,
(c) in United States Treasury securities or securities issued by a Federal agency with a market value equal to 115 percent of the required amount.
$ ___________________, receipt of which is acknowledged by the Depository, to be held and disbursed by the Depository as hereinafter set out.
2. Said deposit shall be held subject to disbursement at the direction of the Commissioner for a period of ___________ months following final endorsement
of the mortgage loan for insurance plus any additional period by which the beginning of amortization of the loan may be deferred. Disbursements from the escrow
may be authorized monthly by the Commissioner to meet any cash deficit in the operation of the project for the period immediately following final completion
of construction. In determining the amount of such cash deficit, effect will be given to the mortagor's payments for amortization and deposits in the Reserve
for Replacements, but no effect will be given to depreciation, officers' salaries, and management fees paid to the owners or sponsors of the project or their
nominees.
3. The deposit will be subject to immediate application to the mortgage debt in the event of default under the mortgage at any time prior to the expiration of
the escrow period.
4. It is understood and agreed that at the expiration of the escrow period, or at such earlier date as the Commissioner determines that the project has achieved
sustaining occupancy and income, any balance remaining on deposit will be returned to the sponsors, without interest.
5. It is further understood and agreed that the Depository will hold and disburse this escrow at the sole direction of the Commissioner; and the sponsors hereby
authorize the Depository, in the event the deposit hereunder is other than in cash, to draw against the letter of credit or to sell the bonds to the extent necessary
to provide the cash necessary to make the disbursements directed by the Commissioner.
6. Whenever used herein, the singular number shall include the plural, the plural the singular, and the use of any gender, shall be applicable to all genders.
Dated: __________________________

_____________________________________________________________________________ (Seal)
(Sponsor)
_____________________________________________________________________________ (Seal)
(Sponsor)
_____________________________________________________________________________ (Seal)
(Sponsor)
_____________________________________________________________________________ (Seal)
(Sponsor)
_____________________________________________________________________________ (Seal)
(Depository)
ref. Handbook 4430.1

form HUD-92476-A (01/2003)