Agmt 2012 Eden Surf Associates LP

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Government Code Section 1 1 135, et seq., and the Unruh Civil Rights Act, Civil Code Section 51, et seq.. Borrower shall indemnify. defend (with counsel reasonably approved by City) and hold harmless the Indemnitees from and against any and all Claims arising in connection with the breach of Borrower's obligations set forth in this Section whether or not any insurance policies shall have been determined to be applicable to any such Claims. It is further agreed that City does not and shall not waive any rights against Borrower which they may have by reason of this indemnity and hold harmless agreement because of the acceptance by City, or Borrower's deposit with City of any of the insurance policies described in this Agreement. Borrower's indemnification obligations set forth in this Section shall not apply to Claims arising from the gross negligence or willful misconduct of the lndemnitees. Borrower's defense and indemnification obligations set forth in this Section 3.16 shall survive the expiration or earlier termination of this Agreement. 3.17 Liens and Stop Notices. Until the expiration of the term of the Regulatory Agreement and full repayment of the Loan, Borrower shall not allow to be placed on the Property or any part thereof any lien or stop notice on account of materials supplied to or labor performed on behalf of Borrower. I f a claim of a lien or stop notice is given or recorded affecting the Project, Borrower shall within thirty (30) days of such recording or service: (a) pay and discharge (or cause to be paid and discharged) the same; or (b) effect the release thereof by recording and delivering (or causing to be recorded and delivered) to the party entitled thereto a surety bond in sufficient form and amount; or (c) provide other assurance satisfactory to City that the claim of lien or stop notice will be paid or discharged. Nothing contained herein shall impair Borrower's or any Project lenders' right to contest, in accordance with all applicable laws, any lien or stop notice that Borrower reasonably believes to have been inappropriately filed against the Property. 3.18 Right of City to Satisfy Liens on the Property. If Borrower fails to satisfy or discharge any lien or stop notice on the Property pursuant to and within the time period set forth in Section 3.17 above, the City shall have the right, but not the obligation, to satisfy any such liens or stop notices at Borrower's expense and without further notice to Borrower and all sums advanced by City for such purpose shall be part of the indebtedness secured by the Deed of Trust. In such event Borrower shall be liable for and shall immediately reimburse City for such paid lien or stop notice. Alternatively, the City may require Borrower to immediately deposit with City the amount necessary to satisfy such lien or claim pending resolution thereof. The City may use such deposit to satisfy any claim or lien that is adversely determined against Borrower. Borrower shall file a valid notice of cessation or notice of completion upon cessation of work on the Improvements for a continuous period of thirty (30) days or more, and shall take all other reasonable steps to forestall the assertion of claims or liens against the Property or the Improvements. The City may (but has no obligation to) record any notices of completion or cessation of labor, or any other notice that the City deems necessary or desirable to protect its interest in the Property and the Improvements. 3.19 Performance and Payment Bonds. Prior to commencement of rehabilitation of the Improvements, Borrower shall cause its general contractor to deliver to the City copies of payment bond(s) and performance bond(s) issued by a reputable insurance company licensed to do business in California, each in a penal sum of not less than one hundred percent (100 %) of the scheduled cost of rehabilitation of the improvements. The bonds shall name the City as co- 1755895.3 10