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Senior Lienholder's reasonable determination: (1) Subordinate Lienholder has executed <br /> the form of Assumption Agreement provided by Senior Lienholder; (2) Subordinate <br /> Lienholder cures any existing defaults under the Senior Lienholder Documents through <br /> escrow, and there exists no other event, which, with the giving of notice or the passage of <br /> time or both, would constitute an event of default under any of the Senior Lienholder <br /> Documents; and (3) Senior Lienholder receives a new Senior Lienholder's policy of title <br /> insurance or endorsement insuring the continued existing lien status of the Senior <br /> Lienholder Loan. In the event the above conditions are met, all existing terms of the <br /> Senior Lienholder Documents will remain in effect. The obligations of Senior Lienholder <br /> stated herein are expressly conditioned upon the assumption transaction being in <br /> compliance with the applicable law and regulations of all government agencies having <br /> jurisdiction over Senior Lienholder at the time of the transfer. The provisions of this <br /> Paragraph shall apply to the transfer of the Property to Subordinate Lienholder only and it <br /> shall not apply to any other or subsequent transfer to any other party. <br /> (vi) As required pursuant to Section 33334.14(a)(4) of the California, Health <br /> and Safety Code, Subordinate Lienholder has determined that an economically feasible <br /> alternative method of financing, refinancing or assisting the project situated or to be <br /> situated on the Property, on substantially comparable terms and conditions to the Senior <br /> Lienholder Documents, without subordination, is not reasonably available. <br /> 6. The Agency declares, agrees and acknowledges that: <br /> a. It consents to and approves of all provisions of the Senior Lienholder Loan <br /> Documents and any and all loan or escrow agreements between the Borrower and Senior <br /> Lienholder for the disbursement of the proceeds of Senior Lienholder's loan; <br /> b. Senior Lienholder in making disbursements pursuant to any such <br /> agreement is under no obligation or duty to, nor has Senior Lienholder represented that it will see <br /> to the application of such proceeds by the person or persons to whom Senior Lienholder <br /> disburses such proceeds and any application or use of such proceeds for purposes other than <br /> those provided for in such agreement or agreements shall not defeat the subordination herein <br /> made in whole or in part; and <br /> c. It intentionally and unconditionally subordinates the lien or charge of the <br /> Subordinate Lienholder Documents in favor of the lien or charge upon the Property of the Senior <br /> Lienholder Deed of Trust and understands that in reliance upon, and in consideration of this <br /> subordination, specific loan and advances are being and will be made, and as part and parcel <br /> thereof, specific monetary and other obligations are being entered into which would not be made <br /> or entered into but for said reliance upon this subordination. <br /> 7. This Subordination Agreement may be executed in counterparts, but all <br /> counterparts shall constitute but one and the same document. This Subordination Agreement <br /> shall inure to the benefit of the Senior Lienholder and its successors and assigns, and shall be <br /> binding upon the Agency and its successors and assigns. <br /> • <br /> C: \Documents and Settings \tliao\Local Settings\Temporary Internet Files \OLK49\SLO - Mission Bell Final Subordination Agreement Fremont <br /> Bank.DOC <br />