Agmt 2013 San Leandro Unified School District SLUSD

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Loan Agreement between City and SLUSD 1.2 PREPAYMENT. District may, without premium or penalty, at any time and from time to time, prepay all or any portion of the outstanding principal balance due under this Note provided that each such prepayment is accompanied by accrued interest on the amount of principal prepaid calculated to the date of such prepayment. Prepayments shall be applied first to accrued but unpaid interest, and then to principal. 1.3 MANNER OF PAYMENT. All payments of principal and interest on this Note shall be made payable to "City of San Leandro" in lawful money of the United States at 835 East 14th Street, San Leandro, California 94577 or such other place as City shall designate to District in writing, or by wire transfer of immediately available funds to an account designated by City in writing. 1.4 SUBORDINATION. Notwithstanding any contrary provision hereof, District's obligation to repay the Loan shall not be subordinate to any encumbrance, instrument or other indebtedness incurred by the District, whether or not such encumbrance, instrument or other indebtedness is related to this Note. 1.5 The Parties acknowledge that they are both public entities and, as such, are precluded by the California State Constitution and other laws from entering into obligations which financially bind future governing bodies without a vote of the electorate, and that, therefore, except to the extent permitted by law, nothing in this Loan Agreement shall constitute an obligation of future legislative bodies of the City and District to appropriate funds for the purposes of this Note. The Parties covenant that each will take all diligent steps necessary to seek appropriations each year. If the District ceases appropriating funds for the purposes of this Note, the District shall be required to issue a payment of one hundred thousand dollars ($100,000) to the City. 2. DEFAULTS AND REMEDIES. 2.1 EVENTS OF DEFAULT. The occurrence of any one or more of the following events shall constitute an event of default hereunder ("Event of Default"): (a) District fails to pay upon demand any payment due of principal and interest payable hereunder and such failure continues for ten (10) days after City notifies District thereof in writing. (b) District breaches any other provision of this Note or the Loan Agreement and does not cure such breach within thirty (30) days following written notice from City. 2.2 The District's failure to appropriate sufficient funds to pay when due any payment of principal and interest payable hereunder shall not constitute an event of default pursuant to this Section. 7