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77060900v2
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<br />operate and construct the Project Facilities in accordance with the provisions of the Funding Loan
<br />Documents. Except as set forth on Schedule 5 hereto, the Borrower has obtained all Governmental Actions
<br />from such Governmental Authorities which are a necessary precondition to construct, own and operate the
<br />Project Facilities and all such Governmental Actions were duly issued, are in full force and effect and are
<br />not subject to any pending judicial or administrative proceedings, the period for judicial or administrative
<br />appeal or review having expired and no petition for administrative or judicial appeal or review having been
<br />filed. The Project Facilities (upon completion of construction of the Project Facilities as contemplated in
<br />the Plans and Specifications) will comply with all Governmental Actions and Legal Requirements,
<br />including all zoning restrictions (including without limitation, use density, setbacks, parking and other
<br />similar requirements) or the Borrower has a valid variance for or exemption from such requirements. All
<br />Governmental Actions obtained by the Borrower have been validly issued and are in full force and effect.
<br />With respect to any Government Actions not yet obtained, the Borrower knows of no reason such
<br />Governmental Actions will not be timely obtained in the ordinary course of business and as needed in
<br />connection with the construction or operation of the Project Facilities. No such Governmental Action will
<br />terminate, or become void or voidable or terminable, upon any sale, transfer or other disposition of the
<br />Project Facilities including any transfer pursuant to foreclosure sale under the Mortgage.
<br />Section 5.4 Validity and Binding Effect. This Agreement and the other Funding Loan
<br />Documents and the Subordinate Debt Documents to which the Borrower is a party are the legal, valid and
<br />binding obligations of the Borrower, enforceable against it in accordance with their respective terms,
<br />subject to the application by a court of general principles of equity and to the effect of any applicable
<br />bankruptcy, insolvency, reorganization, moratorium or similar Legal Requirement affecting creditors’
<br />rights generally.
<br />Section 5.5 No Litigation. Except as disclosed on Schedule 1 attached hereto, there is no
<br />pending action or proceeding, including eminent domain proceedings, before any Governmental Authority
<br />or arbitrator against or involving the Borrower, the General Partner or to the Borrower ’s knowledge after
<br />due inquiry, the Project Facilities and, to the best knowledge of the Borrower and the General Partner, there
<br />is no threatened action or proceeding, including eminent domain proceedings, affecting the Borrower or the
<br />General Partner before any Governmental Authority or arbitrator which, in any case, might materially and
<br />adversely affect the business, operations, assets, condition (financial or otherwise) or prospects of the
<br />Borrower or the General Partner, or the validity or enforceability of this Agreement, t he Governmental
<br />Note, the Subordinate Debt Documents or the Funding Loan Documents or the construction, operation or
<br />ownership of the Project Facilities, or the exclusion from gross income of interest on the Governmental
<br />Note for purposes of federal income taxation or, if specified on the Schedule of Financial Terms as
<br />applicable, the exemption of the Project Facilities from ad valorem real estate taxation under the laws of
<br />the State.
<br />Section 5.6 No Violations. The Borrower and the General Partner are in compliance with, and
<br />not in breach of or default under (a) any applicable Governmental Actions or Legal Requirements with
<br />respect to the Project Facilities of any Governmental Authority having jurisdiction, or (b) the Funding Loan
<br />Documents, the Subordinate Debt Documents or any other credit agreement, indenture, mortgage,
<br />agreement or other instrument to which it is a party or otherwise subject. No event has occurred and is
<br />continuing which, with the passage of time or the giving of notice or both, would constitute an event of
<br />default under any such instrument. The Borrower is not in violation, nor is there any notice or other record
<br />of any violation of any Legal Requirements, restrictive covenants or other restrictions applicable to any of
<br />the Project Facilities.
<br />Section 5.7 Compliance. The ownership of the Project Facilities, the construction of the
<br />Project Facilities, and the use and operation of the Project Facilities as contemplated hereby do and shall,
<br />in all material respects, comply with, and are lawful and permitted uses under, the Tax Certificate and the
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