Agmt 2006 Allied Housing Program (2)

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extremely low-income households for a term of not less than 55 years. This Agreement, the City Note, and the City Deed of Trust are collectively hereinafter referred to as the "City Loan Documents." The City Loan Documents and the Regulatory Agreement are collectively referred to herein as the "City Documents." NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows. ARTICLE I LOAN TERMS 1.1 LOAN AND NOTE. City agrees to loan to Borrower, and Borrower agrees to borrow from and repay to City One Million One Hundred Thousand Dollars and Sixty-Seven Cents ($1,100,000.67) subject to this Section 1.1. upon the terms and conditions and for the purposes set forth in this Agreement. The Loan shall be evidenced by the City Note which shall be dated as of the Effective Date and executed by Borrower substantially in the form attached hereto as Exhibit B. Provided that Borrower has complied with all conditions precedent to disbursement of the Loan set forth in Section 2.3, the proceeds ofthe Loan ("Loan Proceeds") shall be disbursed in accordance with Section 2.2 hereof. Without limiting the generality of the foregoing, it is expressly understood by the Parties that City's obligation to fund the Loan is contingent upon Borrower's provision to the City of evidence reasonably satisfactory to the City that all sources of funds necessary for the acquisition and permanent financing of the Project are available. City shall have the option to terminate this Agreement, and shall have no obligation to fund the Loan if concurrently with the closing of the Loan Borrower does not close on the other financing for the Project in an aggregate amount which, together with other sources of funding committed to Borrower is sufficient to fully finance the acquisition of the Project. The Parties agree that City shall disburse Loan Proceeds only for and to the extent necessary for the purposes set forth in Section 2.1. 1.2. INTEREST RATE. Loan interest shall accrue at a rate equal to three percent (3%) simple interest per annum on the unpaid principal outstanding from time to time commencing on the date of initial disbursement of such Loan Proceeds and continuing through the date that all indebtedness and other amounts payable under the Note and other City Loan Documents are paid in full. 1.3. MATURITY DATE. The entire outstanding principal balance of the Loan together with interest accrued thereon and any other sums due under the City Loan Documents shall be payable in full on the fifty-fifth (55th) anniversary of the Effective Date ("Maturity Date"). 1.4. ANNUAL PAYMENTS FROM SURPLUS CASH. Commencing on [June 1, 2011] and on the first day of each [June] thereafter during the term hereof, Borrower shall pay to City all Surplus Cash generated by the Project during the previous calendar year to reduce the indebtedness owed under the Note. Repayment under this section shall be applied first to any unpaid late charges, then to accrued but unpaid interest and then to outstanding principal. 818012-3 2