Item 16 - Affordable Housing Project at 801, 807, 809 and 809 ½ E. Santa Ana Blvd

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equipment; insurance; advertising and marketing; accounting and legal fees; brokerage commissions and other leasing expenses; reasonable reserves for all anticipated expenses as approved by the Agency; and other such items constituting operation, maintenance and repair costs actually paid by the Borrower, subject to the following conditions: (a) Depreciation and amortization expenses shall not be considered Operating Expenses, except as otherwise provided herein; and, (b) Any expenses, compensation or fees paid to any affiliate of Borrower, excluding those payable under (iii), shall only be included as Operating Expenses to the extent they are not in excess of the reasonable expenses, compensation or fees that would be payable to unrelated third parties in arms-length transactions for similar services in the Orange County, California area; “Annual Project Revenue” means all annual revenue generated by the Project from any source, including, but not limited to, rent payments, governmental assistance housing payments, laundry and other vending machine and pay telephone income. Notwithstanding the foregoing, Annual Project Revenue shall not include the following items: (a) security deposits from subtenants (except when applied by Borrower to rent or other amounts owing by subtenants); (b) capital contributions to Borrower by its members, partners or shareholders (including capital contributions required to pay deferred developer fee); (c) condemnation or insurance proceeds; (d) there shall be no line item, expense, or revenue shown allocable to vacant unit(s) at the Project; or (e) receipt by an Affiliate of management fees or other bona fide arms-length payments for reasonable and necessary Operating Expenses associated with the Project. For purposes of this Lease, “Annual Project Revenue” shall expressly exclude any and all cash or in-kind donations and contributions made to the Borrower. “Borrower” means Shelter Providers of Orange County, Inc. DBA HomeAid Orange County. “Calendar Year” means each consecutive twelve (12) month period from January 1 to December 31. "Closing Costs" shall mean: (i) In the case of a Transfer, reasonable brokerage commissions payable to a broker as a result of the Transfer, which shall not in any event exceed the customary amount charged for similar transactions in the immediate market place, costs of title insurance premiums, escrow fees, recording charges, loan repayment charges and other costs reasonably incurred with respect to the Property, in each case actually paid by Borrower as a condition of the Transfer. EXHIBIT 4