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II, ACCOUNTING,AUDIT,AND RECORDS REQUIREMENTS
<br /> 2.01 Separate Account. The Recipient agrees to establish and maintain a separate account
<br /> for the loan and to maintain accurate and complete records and accounts relating to the receipt and
<br /> expenditure of all loan funds. Such accounts and records shall be kept and maintained for a period of
<br /> at least three (3)years following discharge of the loan..
<br /> 2.02 Audit. The above accounts and records of the Recipient shall be audited in the same
<br /> manner as all other accounts and records of the Recipient are audited, and may be audited and/or
<br /> inspected on the Recipient's premises or otherwise by individuals or organizations designated and
<br /> authorized by the Council at any time, following reasonable notification, during the loan period, and
<br /> for a period of six(6)years following discharge of the loan.
<br /> 2.03 Acquisition Report. The Recipient agrees that upon completion of any acquisition,the
<br /> Recipient will submit to the Council an acquisition report,in a format to be determined by the Council,
<br /> summarizing the acquisition costs of the property,including all eligible expenses and moving costs,
<br /> 2.04 Annual Reports The Recipient agrees to submit, on or before June 30 of each year
<br /> during which this,agreement is in effect, an annual report on-the status of the loan, in a form to be
<br /> determined by the Council,
<br /> III. INCOME FROM PURCHASED PROPERTY
<br /> 3.01 Net Rents Defined. For purposes of this agreement, "net rents" means the total gross
<br /> rent received'by the Recipient from any and all tenants or users of the property,less the Recipient's
<br /> actual costs for necessary maintenance, repairs, taxes, insurance, and operating expenses, and
<br /> attorneys'fees associated with preparing or terminating any lease with respect to the property.
<br /> 3.02 Transfer of Net Rents. The Recipient agrees to transfer to the Council,within forty-five
<br /> (45) days of receipt,all net rents or other money received as a result of the Recipient's ownership of
<br /> the property. For any given payment to the Council,the Recipient may estimate the actual costs to be
<br /> deducted from gross rent. -
<br /> 3.03 Adjustment for Actual Costs. Twelve (12)months from the commencement of receipt
<br /> of any rent by the Recipient from any property acquired with loan proceeds, the Recipient shall
<br /> provide, in a form acceptable to the Council, documentation for all actual costs for necessary
<br /> maintenance, repairs, taxes, insurance, and operating expenses, and attorneys' fees with respect to
<br /> the property. Upon verification and acceptance of the documentation by the Council, the Recipient
<br /> shall pay to the Council the amount, if any, determined by the Council to be necessary to adjust the
<br /> estimated deduction from gross rent to reflect the actual costs,
<br /> Iv. LOAN DISCHARGE
<br /> 4.01 Discharge Due to Conveyance to Highway Authority. If any parcel purchased with
<br /> the loan funds is conveyed to a highway authority for construction of a highway,the Recipient shall
<br /> repay.to the Council, within thirty (30) days of receipt, the amount received from the highway
<br /> authority for the parcel, acquisition costs and relocation expenses. If any parcel purchased with the
<br /> loan funds is utilized by the Recipient, rather than the highway authority, for construction of a
<br /> highway project, the Recipient shall repair the loan to the Council prior to commencing any road
<br /> construction on said parcel. Upon payment of the specified amount, the Council will discharge the
<br /> loan.
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