Debt Financing

The Company currently has outstanding debt financing of $257.3 million under separate credit facilities. As of December 31, 2012, the Company's outstanding debt financing totaled approximately $177.9 million 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 approximately 3.5% per annum at the date of closing and matures in March 2014. On December 31, 2013, the Partnership had nothing borrowed under this facility. This line of credit is available to 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 debt facility secured by the Iona Lakes mortgage revenue bond with total available borrowings of up to $6.0 million. Any borrowed amount carried a fixed interest rate of 5.0% per annum and matured on January 25, 2014. On June 29, 2013 the Partnership retired this debt facility.

Tender Option Bond Financings



Description of the Tender Option Bond Financings	Outstanding Debt Financing at December 31, 2013		Year Acquired	Stated Maturity	Year End Rates
PHC Certificates-TOB Trust	$	48,995,000	2012	June 2014	2.32	%
Autumn Pines-TOB Trust	9,770,000		2011	July 2014	1.96	%
MBS - TOB Trust 1	2,585,000		2012	April 2014	1.21	%
MBS - TOB Trust 2	4,090,000		2012	April 2014	1.29	%
MBS - TOB Trust 3	2,865,000		2012	April 2014	1.22	%
MBS - TOB Trust 4	5,960,000		2012	April 2014	1.23	%
MBS - TOB Trust 5	10,545,000		2012	April 2014	1.27	%
Greens of Pine Glen - TOB Trust	5,700,000		2013	June 2014	2.40	%
Arbors of Hickory Ridge - TOB Trust	7,000,000		2013	August 2014	2.40	%
MBS - TOB Trust 6	7,825,000		2013	August 2014	1.02	%
Avistar (February 2013 portfolio) - TOB Trust ⁽¹⁾	20,000,000		2013	June 2014	2.21	%
Avistar (June 2013 portfolio) - TOB Trust ⁽²⁾	13,210,000		2013	October 2014	2.21	%
The Suites on Paseo - TOB Trust	25,750,000		2013	December 2014	1.96	%
Total Debt Financing	$	164,295,000

Description of the Tender Option Bond Financings	Outstanding Debt Financing at December 31, 2012		Year Acquired	Stated Maturity	Year End Rates
PHC Certificates-TOB Trust	$	48,995,000	2012	July 2013	2.30	%
Autumn Pines-TOB Trust	9,850,000		2011	July 2013	2.05	%
MBS - TOB Trust 1	2,585,000		2012	October 2013	1.31	%
MBS - TOB Trust 2	4,090,000		2012	October 2013	1.29	%
MBS - TOB Trust 3	3,890,000		2012	October 2013	1.32	%
MBS - TOB Trust 4	5,960,000		2012	October 2013	1.29	%
MBS - TOB Trust 5	8,590,000		2012	October 2013	1.28	%
Total Debt Financing	$	83,960,000

⁽¹⁾ Avistar at the Oaks Apartments, Avistar on the Hills Apartments, and Avistar in 09 Apartments is the collateral for the $20.0 million TOB Trust.

⁽²⁾ Avistar at Chase Hill, Avistar at the Crest, and Avistar on the Boulevard is the collateral for the approximate $13.2 million TOB Trust.

In July 2011, the Company executed a Master Trust Agreement with DB which allows the Company to execute multiple Tender Option Bond ("TOB Trust") structures upon the approval and agreement of terms by DB. Under each TOB Trust 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 with which the Company is required to maintain compliance. At December 31, 2013, the most restrictive covenant was 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 December 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 agreements. DB can require the posting of cash collateral under the terms of the Master Trust Agreement.

In December 2013, the Company executed a new TOB Trust under its credit facility with DB securitizing The Suites on Paseo Series A mortgage revenue bond. The amount borrowed was approximately $25.8 million with a variable interest rate tied to SIFMA. The facility matures in December 2014. On the date of the closing the total fixed TOB Trust fee was approximately 1.6% per annum and the variable rate paid on the TOB Trust on the SPEARS was approximately 0.4% per annum resulting in a total cost of borrowing of approximately 2.0% per annum. The outstanding balance remains at approximately $25.8 million on December 31, 2013.

In October 2013, the Company executed a new TOB Trust under its credit facility with DB securitizing the Avistar at the Oaks Apartments, the Avistar on the Hills Apartments, and the Avistar in 09 Apartments Series A mortgage revenue bonds. The amount borrowed was approximately $13.2 million with a variable interest rate tied to SIFMA. The facility matures in October 2014. On the date of the closing the total fixed TOB Trust fee was approximately 1.8% per annum and the variable rate paid on the TOB Trust on the SPEARS was approximately 0.4% per annum resulting in a total cost of borrowing of approximately 2.2% per annum. The outstanding balance remains at $13.2 million on December 31, 2013.

In June 2013, the Company executed a new TOB Trust under its credit facility with DB securitizing the Avistar on the Boulevard, Avistar at Chase Hill, and Avistar at the Crest Series A mortgage revenue bonds. The amount borrowed was $20.0 million with a variable interest rate tied to SIFMA. The facility matures in June 2014. On the date of closing the total fixed TOB Trust fee was approximately 2.1% per annum and the variable rate paid on the TOB Trust on the SPEARS was approximately 0.4% per annum resulting in a total cost of borrowing of approximately 2.5% per annum. During the fourth quarter 2013 the total fixed TOB Trust fee was reduced to approximately 1.8% per annum and the variable rate paid on the TOB Trust on the SPEARS was approximately 0.4% per annum resulting in a total cost of borrowing of approximately 2.2% per annum. The outstanding balance remains at $20.0 million on December 31, 2013.

In March 2013, the Company executed a new TOB Trust under its credit facility with DB securitizing the Arbors at Hickory Ridge mortgage revenue bond. The amount borrowed was $7.0 million with a variable interest rate tied to SIFMA maturing in February 2014. On the date of closing the total fixed TOB Trust fee was approximately 2.1% per annum and the variable rate paid on the TOB Trust on the SPEARS was approximately 0.5% per annum resulting in a total cost of borrowing of approximately 2.6% per annum. During the fourth quarter 2013 the total fixed TOB Trust fee was reduced to approximately 1.8% per annum and the variable rate paid on the TOB Trust on the SPEARS was approximately 0.6% per annum resulting in a total cost of borrowing of approximately 2.4% per annum. The outstanding balance remains at $7.0 million on December 31, 2013.

In February 2013, the Company executed a new TOB Trust under its credit facility with DB securitizing the Greens Property mortgage revenue bond. The amount borrowed was approximately $5.8 million with a variable interest rate tied to SIFMA maturing in December 2013. On the date of closing the total fixed TOB trust fee was approximately 2.1% per annum and the variable rate paid on the TOB Trust on the SPEARS was approximately 0.5% per annum resulting in a total cost of borrowing of approximately 2.6% per annum. During the fourth quarter 2013 the total fixed TOB Trust fee was reduced to approximately 1.8% per annum and the variable rate paid on the TOB Trust on the SPEARS was approximately 0.6% per annum resulting in a total cost of borrowing of approximately 2.4% per annum. The outstanding balance was $5.7 million on December 31, 2013.

In the fourth quarter of 2012 through the second quarter of 2013, the Company purchased the LIFERS issued by the trustee over six additional TOB Trusts. The LIFERS entitle the Company to all principal and interest payments received by these TOB Trusts on the mortgage-backed securities after payments due to the holders of the SPEARS and trust costs ("MBS TOB Trusts"). The SPEARS represent senior interests in the MBS TOB Trusts and some have been credit enhanced by DB. 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). A summary of the six MBS TOB Trusts are as follows:

•

During fourth quarter of 2012, the Company purchased approximately $6.5 million of LIFERS from securitized MBS TOB Trusts with a par value of approximately $31.6 million of MBS. The MBS TOB Trusts also issued SPEARS of approximately $25.1 million to unaffiliated investors. The approximate outstanding amount at December 31, 2013 is $24.1 million which mature in April 2014. On the date of closing the total fixed TOB Trust fee was approximately 0.9% per annum and the variable rate paid on the SPEARS of approximately 0.3% per annum is tied to SIFMA which results in the total cost of borrowing of approximately 1.2% per annum.

•

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 is currently outstanding at December 31, 2013. This MBS TOB Trust matures in April 2014. On the date of closing the total fixed TOB Trust fee was approximately 0.9% per annum and the variable rate paid on the SPEARS of approximately 0.3% per annum is tied to SIFMA which results in the total cost of borrowing of approximately 1.2% per annum.

•

In April 2013, the Company purchased approximately $2.2 million of LIFERS issued by a new MBS TOB Trust which is the securitization of MBS with a par value of approximately $10.0 million. The MBS TOB Trusts issued SPEARS of approximately $7.8 million to unaffiliated investors which is the outstanding amount at December 31, 2013. This facility matures in February 2014. On the date of closing the total fixed TOB Trust fee was approximately 0.9% per annum and the variable rate paid on the SPEARS of approximately 0.1% per annum is tied to SIFMA which results in the total cost of borrowing of approximately 1.0% per annum.

As of December 31, 2013, the Company has posted approximately $4.1 million of cash collateral in connection with the six MBS TOB Trusts. This collateral is recorded as restricted cash in the consolidated financial statements.

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 December 31, 2013. As of December 31, 2013, the Company has posted approximately $400,000 of cash collateral in connection with one of the PHC TOB Trusts which is recorded as restricted cash.

As of December 31, 2013 and 2012, the total cost of borrowing for the PHC Certificates TOB financing facilities was approximately 2.3% and 2.3% per annum, respectively, and the weighted average cost of borrowing on the TOB financing facilities securitizing mortgage-backed securities was approximately 1.3% and 1.3% per annum, respectively. The Company's total cost of borrowing under the TOB financing facilities collateralized by the mortgage revenue bonds is approximately 2.7% and 1.9% per annum as of December 31, 2013 and 2012, respectively. The Company is accounting for these TOB transactions as secured financing arrangements.

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 mortgage revenue bonds owned by the ATAX TEBS I, LLC (the “Sponsor”) pursuant to the TEBS Financing. The TEBS financing facility 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 mortgage revenue bonds to ATAX TEBS I, LLC, a special purpose entity controlled by the Partnership pursuant to the TEBS Financing. The par value of the mortgage revenue bonds included in this financing facility as of December 31, 2013 and 2012 are as follows:



	Outstanding Bond Par Amounts
Description of Mortgage
Revenue Bonds	December 31, 2013		December 31, 2012		Financial Statement Presentation
Ashley Square	$	5,212,000	$	5,260,000	Mortgage revenue bond
Bella Vista	6,545,000		6,600,000		Mortgage revenue bond
Bent Tree	7,542,000		7,614,000		Consolidated VIE
Bridle Ridge	7,715,000		7,765,000		Mortgage revenue bond
Brookstone	9,338,603		9,416,794		Mortgage revenue bond
Cross Creek	8,497,933		8,568,409		Mortgage revenue bond
Fairmont Oaks	7,355,000		7,439,000		Consolidated VIE
Lake Forest	8,997,000		9,105,000		Mortgage revenue bond-2013/Consolidated VIE-2012
Runnymede	10,525,000		10,605,000		Mortgage revenue bond
South Park	13,795,000		13,900,000		Mortgage revenue bond
Woodlynn Village	4,426,000		4,460,000		Mortgage revenue bond
Ohio Series A Bond ⁽¹⁾	14,498,000		14,582,000		Mortgage revenue bond
Villages at Lost Creek	18,090,000		18,315,000		Mortgage revenue bond
Total	$	122,536,536	$	123,630,203

⁽¹⁾ Collateralized by Crescent Village, Post Woods and Willow Bend which are eliminated upon consolidation (Note 3)

The securitization of these mortgage revenue bonds 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”). As of December 31, 2013, the SIFMA rate was equal to 0.10% per annum resulting in a total cost of borrowing of 2.00% per annum on the outstanding balance on the TEBS financing facility of $93.0 million. As of December 31, 2012, the SIFMA rate was equal to 0.13% per annum resulting in a total cost of borrowing of 2.03% per annum on the outstanding balance on the TEBS financing facility of $94.0 million.

Payment of interest on the Class A TEBS Certificates will be made from the interest payments received by Freddie Mac from the Bonds and Senior Custody Receipts held by Freddie Mac on designated interest payment dates prior to any payments of interest on the Class B TEBS Certificates held by the Sponsor. As the holder of the Class B TEBS Certificates, the Sponsor is not entitled to receive interest payments on the Class B TEBS Certificates at any particular rate, but will be entitled to all payments of principal and interest on the Bonds and Senior Custody Receipts held by Freddie Mac after payment of principal and interest due on the Class A TEBS Certificates and payment of all Facility Fees and associated expenses. Accordingly, the amount of interest paid to the Sponsor on the Class B TEBS Certificates is expected to vary over time, and could be eliminated altogether, due to fluctuations in the interest rate payable on the Class A TEBS Certificates, Facility Fees, expenses and other factors.

The term of the TEBS financing facility coincides with the terms of the assets securing the TEBS Certificates, except that the Partnership may terminate the TEBS financing facility at its option on either September 15, 2017 or September 15, 2020. Should the Partnership not elect to terminate the TEBS financing facility on these dates, the full term of the TEBS financing facility runs through the final principal payment date associated with the securitized bonds, or July 15, 2050. The TOB Financing facilities mature between August 15, 2014 and December 15, 2014 with options available for the Company to extend another year.

The Company's aggregate borrowings as of December 31, 2013 contractually mature over the next five years and thereafter as follows:



2014	$	165,378,000
2015	1,139,000
2016	1,192,000
2017	89,565,000
2018	—
Thereafter	—
Total	$	257,274,000