Debt Financing

At March 31, 2013 and December 31, 2012, the Company reported outstanding debt financing of approximately $194.3 million and approximately $177.9 million, respectively, under separate credit facilities.

Other Financings

In March 2013, the Partnership obtained a $10.0 million unsecured revolving line of credit. This revolving line of credit carries a variable interest rate which was approximately3.5% at date of closing. On March 31, 2013, the Partnership reported an approximate $2.0 million balance at an approximate 3.5% interest rate. This line of credit will be utilized to help with short-term working capital needs and to fund new investments during the periods of time that Company is working with its lender to finalize new TOB financings of assets.

In February 2013, the Partnership obtained a line of credit secured by the Iona Lakes tax-exempt mortgage revenue bond with total available borrowings of up to $6.0 million. Any borrowed amount carries a fixed interest rate of 5.0% and matures on January 25, 2014. On March 31, 2013, the Partnership owed approximately $66,000 on this debt facility. This loan will also be used for temporary working capital needs of the Partnership.

Tender Option Bond Financings



Description of the Tender Option Bond Financings	Outstanding Debt Financing at March 31, 2013		Stated Maturity

PHC Trust Certificates	$	48,995,000	July 2013
Autumn Pines	9,850,000		July 2013
MBS - Trust 1	2,585,000		October 2013
MBS - Trust 2	4,090,000		October 2013
MBS - Trust 3	3,540,000		October 2013
MBS - Trust 4	5,960,000		October 2013
MBS - Trust 5	10,545,000		October 2013
Greens of Pine Glen	5,745,000		December 2013
Arbors of Hickory Ridge	7,000,000		February 2013
Total TOB Debt Financing	$	98,310,000

Description of the Tender Option Bond Financings	Outstanding Debt Financing at December 31, 2012		Stated Maturity

PHC Trust Certificates	$	48,995,000	July 2013
Autumn Pines	9,850,000		July 2013
MBS - Trust 1	2,585,000		October 2013
MBS - Trust 2	4,090,000		October 2013
MBS - Trust 3	3,890,000		October 2013
MBS - Trust 4	5,960,000		October 2013
MBS - Trust 5	8,590,000		October 2013
Total TOB Debt Financing	$	83,960,000

In July 2011, the Company executed a Master Trust Agreement with DB which allows the Company to execute multiple Tender Option Bond ("TOB") structures upon the approval and agreement of terms by DB. Under each TOB structure issued through the Master Trust Agreement, the TOB trustee issues SPEARS and LIFERS. Theses SPEARS and LIFERS represent beneficial interests in the securitized asset held by the TOB trustee. The Company will purchase the LIFERS from each of these TOB Trusts which will grant them certain rights to the securitized assets. The Master Trust Agreement with DB has covenants that the Company is required to maintain compliance, the most restrictive of which at March 31, 2013 is that cash available to distribute for the trailing twelve months must be at least two times trailing twelve month interest expense. The Company was in compliance with all of these covenants as of March 31, 2013. If the Company were to be out of compliance with any of these covenants, it would trigger a termination event of the financing facilities. The Company expects to renew each of the TOB financing facilities for another one year term at its discretion per the terms of the agreement with DB.

In March 2013, the Company executed a new TOB under its credit facility with DB securitizing the Arbors at Hickory Ridge tax-exempt mortgage revenue bond. The amount borrowed was $7.0 million with a variable interest rate tied to SIFMA. The facility matures in February 2014. On the date of closing and on March 31, 2013, the total fixed TOB trust fee was approximately 2.1% per annum and the rate paid on the TOB trust on the SPEARS was .5% per annum resulting in a total cost of borrowing of approximately 2.6%. The outstanding balance remains at $7.0 million on March 31, 2013.

In February 2013, the Company executed a new TOB under its credit facility with DB securitizing the Greens Property tax-exempt mortgage revenue bond. The amount borrowed was approximately $5.8 million with a variable interest rate tied to SIFMA. The facility matures in December 2013. On the date of closing and on March 31, 2013, the total fixed TOB trust fee was approximately 2.1% per annum and the rate paid on the TOB trust on the SPEARS was .5% per annum resulting in a total cost of borrowing of approximately 2.6%. The outstanding balance remains at $5.8 million on March 31, 2013.

In July 2011, the Company closed a $10.0 million financing utilizing the TOB structure with the DB securitizing the Company's $13.4 million Autumn Pines Apartments tax-exempt mortgage revenue bond. At March 31, 2013, the Company owed approximately $9.9 million on this TOB facility.

In November and December 2012, the Company purchased the LIFERS issued by the trustee over five different TOB Trusts for approximately $6.5 million which are securitizations of mortgage-backed securities ("MBS TOB Trusts") with a par value of approximately $31.6 million. The LIFERS entitle the Company to all principal and interest payments received by these MBS TOB Trusts on the mortgage-backed securities after payments due to the holders of the SPEARS and trust costs. The Company reports the MBS TOB Trusts on a consolidated basis as it has determined it is the primary beneficiary of these variable interest entities (Note 6). The MBS TOB Trusts also issued SPEARS of approximately $24.7 million to unaffiliated investors which is the outstanding amount at March 31, 2013. The SPEARS represent senior interests in the MBS TOB Trusts and some have been credit enhanced by DB. In January 2013, the Company purchased an additional $540,000 of LIFERS from one of the five MBS TOB Trusts which is a securitization of MBS with a par value of $2.5 million. SPEARS of approximately $2.0 million were issued by the MBS TOB Trust which increased the Company's outstanding borrowings.

In July 2012, the Company purchased the PHC Certificate LIFERS issued by the PHC TOB Trusts for approximately $16.0 million and pledged the LIFERS to the trustee to secure certain reimbursement obligations of the Company as the holder of LIFERS. The Company is consolidating the PHC TOB Trust as it has determined it is the primary beneficiary of these variable interest entities. The PHC TOB Trusts issued SPEARS of approximately $49.0 million to unaffiliated investors. The SPEARS represent senior interests in the PHC TOB Trusts and have been credit enhanced by DB. The LIFERS entitle the Company to all principal and interest payments received by the PHC TOB Trusts on the $65.3 million of PHC Certificates held by it after payments due to the holders of the SPEARS and trust costs. The amount owed to the SPEARS owners is approximately $49.0 million at March 31, 2013.

The Company is accounting for these financing transactions as secured financing arrangements. As of March 31, 2013, the total cost of borrowing is approximately 2.3% and 1.2%, on the PHC TOB Trusts and MBS TOB Trusts, respectively.

TEBS Financing

As of September 1, 2010, the Partnership and its Consolidated Subsidiary ATAX TEBS I, LLC, entered into a number of agreements relating to a new long-term debt financing facility provided through the securitization of thirteen tax-exempt mortgage revenue bonds owned by the ATAX TEBS I, LLC (the “Sponsor”) pursuant to the TEBS Financing. The TEBS Financing essentially provides the Partnership with a long-term variable-rate debt facility at interest rates reflecting prevailing short-term tax-exempt rates.

Effective September 1, 2010, the Partnership transferred the following bonds to ATAX TEBS I, LLC, a special purpose entity controlled by the Partnership pursuant to the TEBS Financing. The par value of the bonds included in this financing facility as of March 31, 2013 and December 31, 2012 are as follows:



Description of Tax-Exempt	Outstanding Bond Par Amounts
Mortgage Revenue Bonds	March 31, 2013		December 31, 2012		Financial Statement Presentation
Ashley Square	$	5,248,000	$	5,260,000	Tax-exempt mortgage revenue bond
Bella Vista	6,600,000		6,600,000		Tax-exempt mortgage revenue bond
Bent Tree	7,596,000		7,614,000		Consolidated VIE
Bridle Ridge	7,740,000		7,765,000		Tax-exempt mortgage revenue bond
Brookstone	9,397,647		9,416,794		Tax-exempt mortgage revenue bond
Cross Creek	8,551,193		8,568,409		Tax-exempt mortgage revenue bond
Fairmont Oaks	7,418,000		7,439,000		Consolidated VIE
Lake Forest	9,078,000		9,105,000		Consolidated VIE
Runnymede	10,605,000		10,605,000		Tax-exempt mortgage revenue bond
Southpark	13,900,000		13,900,000		Tax-exempt mortgage revenue bond
Woodlynn Village	4,460,000		4,460,000		Tax-exempt mortgage revenue bond
Ohio Series A Bond ⁽¹⁾	14,561,000		14,582,000		Consolidated MF Property
Villages at Lost Creek	18,315,000		18,315,000		Tax-exempt mortgage revenue bond
Total	$	123,469,840	$	124,648,502

(1) Collateralized by Crescent Village, Postwoods, and Willow Bend (Note 2 and Note 9)

The securitization of these assets occurred through two classes of certificates. The Class A TEBS Certificates were issued in an initial principal amount of $95.8 million and were sold through a placement agent to unaffiliated investors. The Class B TEBS Certificates were issued in an initial principal amount of $20.3 million and were retained by the Sponsor. The holders of the Class A TEBS Certificates are entitled to receive regular payments of interest from Freddie Mac at a variable rate which resets periodically based on the weekly Securities Industry and Financial Markets Association (“SIFMA”) floating index rate plus certain credit, facility, remarketing and servicing fees (the “Facility Fees”). The total Facility Fees are 1.9%, and as of March 31, 2013, the SIFMA rate was equal to approximately 0.1% resulting in a total cost of borrowing of approximately 2.0% on the outstanding balance on the TEBS Financing facility of $93.8 million. The TEBS Financing and the associated TEBS Trust are presented as secured financings within the consolidated financial statements.

The term of the TEBS Financing coincides with the terms of the assets securing the TEBS Certificates, except that the Partnership may terminate the TEBS Financing at its option on either September 15, 2017 or September 15, 2020. Should the Partnership not elect to terminate the TEBS Financing on these dates, the full term of the TEBS Financing runs through the final principal payment date associated with the securitized bonds, or July 15, 2050.

The Company’s debt financing as of March 31, 2013 contractually matures over the next five years and thereafter as follows:



2013	$	92,173,000
2014	10,198,900
2015	1,139,000
2016	1,192,000
2017	89,565,000
Thereafter	—
Total	$	194,267,900

The Company expects to renew each of the TOB financing facilities for another one year term as they mature throughout 2013 as it has the discretion to renew for another one year period per the terms of the agreement with DB.