Agency HAP Commitment Clause Samples

Agency HAP Commitment. Subject to applicable federal laws and regulations, Authority and Borrower will be entering into and will execute a HAP Contract for the Manchester Project providing for Housing Assistance Payments for the thirty-nine (39) HAP Units in the Manchester Project. In the event (a) (i) the HAP Contract is terminated by HUD pursuant thereto or pursuant to action by HUD at any time during the anticipated fifteen (15)-year term of the HAP Contract for a reason other than Borrower’s default under the HAP Contract and (ii) such termination or refusal by HUD to renew the HAP Contract results in the termination of Housing Assistance Payments for the Manchester Project, or (b) HUD fails to fund all or any portion of the Housing Assistance Payments under the HAP Contract (including as a result of the loss of HUD’s appropriation for the HAP Contract) for a reason other than Borrower’s default under the HAP Contract or (c) the HAP Contact is never executed by HUD, for a reason other than Borrower’s default under the AHAP (collectively, the occurrences described in (a) through (c) are referred to herein as a “HAP Contract Failure”), then Agency shall provide a comparable direct subsidy to Borrower on a monthly basis with respect to the HAP Units for which no Housing Assistance Payments (or only a partial Housing Assistance Payment) will be made in a given month, in an amount which shall not exceed the “gap” amount or difference between Fair Market Rent (defined in Section 1.3 below) for the applicable Housing Unit and Affordable Rent payable by the Tenant calculated pursuant to and in compliance with the Tax Credit Rules or with other applicable recorded rent restrictions for the applicable Housing Unit, as described in Section 1.2, below. Agency and Borrower acknowledge and agree that, subject to (A) all applicable federal laws and regulations and