Agmt 2006 Mercy Housing California XXXIII (2)

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become subject to any rights of offset, deduction or counterclaim on the part of Borrower. 1.3 MANNER OF PAYMENT. All payments of principal and interest on this Note shall be made by certified or bank cashier's check to Agency at 835 East 14th Street, San Leandro, California 94577 or such other place as Agency shall designate to Borrower in writing, or by wire transfer of immediately available funds to an account designated by Agency in writing. 2. DEFAULTS 2.1 EVENTS OF DEFAULT. The occurrence of anyone or more of the following events shall constitute an event of default hereunder ("Event of Default"): (a) Borrower fails to pay when due the principal and interest payable hereunder and such failure continues for ten (10) days after Agency notifies Borrower thereof in writing. (b) Borrower fails to use Loan Proceeds in accordance with this Agreement or fails to use Loan Proceeds in accordance with Borrower's request for disbursement. (c) Pursuant to or within the meaning of the United States Bankruptcy Code or any other federal or state law relating to insolvency or relief of debtors ("Bankruptcy Law"), Borrower shall (i) commence a voluntary case or proceeding; (ii) consent to the entry of an order for relief against it in an involuntary case; (iii) consent to the appointment of a trustee, receiver, assignee, liquidator or similar official; (iv) make an assignment for the benefit of its creditors; or (v) admit in writing its inability to pay its debts as they become due. (d) A court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (i) is for relief against Borrower in an involuntary case, (ii) appoints a trustee, receiver, assignee, liquidator or similar official for Borrower or substantially all of Borrower's assets, or (iii) orders the liquidation of Borrower, and in each case the order or decree is not dismissed within 60 days. (e) An Event of Default is declared under the DDA, the Predevelopment Loan Agreement, or the Assignment Agreement. 2.2 REMEDIES. Upon the occurrence of an Event of Default hereunder, subject to the limitations in Section 1.3(b) of the Loan Agreement, Agency may, at its option (i) by written notice to Borrower, declare the entire unpaid principal balance of this Note, together with all accrued interest thereon, immediately due and payable regardless of any prior forbearance, (ii) exercise any and all rights and remedies available to it under applicable law, and (iii) exercise any and all rights and remedies available to Agency pursuant to the Loan Agreement or the Assignment Agreement. Borrower shall pay all reasonable costs and expenses incurred by or on behalf of Agency including, without limitation, reasonable attorneys' fees, incurred in