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(g) No material adverse change as determined by City in its reasonable <br />judgment shall have occurred in the condition of the Property or in the financial or other <br />condition of Developer since the Effective Date that will materially impair the Developer's <br />ability to develop the Project pursuant to this Agreement. <br />4.6 No Obligation to Disburse Proceeds Upon Default. Notwithstanding any other <br />provision of this Agreement, the City shall have no obligation to disburse or authorize the <br />disbursement of any portion of the HOME Loan Proceeds following: <br />(a) the failure of any of Developer’s representations and warranties made in <br />this Agreement or in connection with the HOME Loan to be true and correct in all material <br />respects, subject to the notice and cure periods set forth in Section 10(g) below; <br />(b) the termination of this Agreement by mutual agreement of the Parties; <br />(c) the occurrence of an Event of Default under this Agreement, the <br />Regulatory Agreement or any of the City Documents which remains uncured beyond any <br />applicable cure period. <br />4.7 Prepayment; Acceleration <br />(a) Prepayment. Developer shall have the right to prepay the HOME Loan at <br />any time and from time to time, without penalty or premium, provided that any prepayment of <br />principal must be accompanied by interest accrued but unpaid to the date of prepayment. <br />Prepayments shall be applied first to accrued but unpaid interest and then to principal. Any such <br />prepayment shall have no effect upon Developer’s obligations under the Regulatory Agreement <br />which shall survive for the full term of the Regulatory Agreement. <br />(b) Due On Sale or Encumbrance. Unless City agrees otherwise in writing, <br />the entire unpaid principal balance and all interest and other sums accrued under the HOME <br />Note shall be due and payable upon the Transfer (as defined in Section 7.2) absent the prior <br />written consent of City of all or any part of or interest in the Property except as otherwise <br />permitted pursuant to this Agreement. <br />4.8 Nonrecourse. Except as expressly provided in this Section 4.8, Developer shall <br />have no personal liability for payment of the principal of, or interest on the HOME Note, and the <br />sole recourse of City with respect to the payment of the principal of, and interest on the HOME <br />Note shall be to the Project and any other collateral held by City as security for the HOME Note <br />under the Security Agreement or Leasehold Deed of Trust, as applicable; provided however, <br />nothing contained in the foregoing limitation of liability shall: <br />(a) impair the enforcement against all such security for the HOME Loan of all <br />the rights and remedies of the City under the Leasehold Deed of Trust and any financing <br />statements City files in connection with the HOME Loan, as each of the foregoing may be <br />amended, modified, or restated from time to time; <br />144\259\1892880.4 <br />13