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ARTICLE 1. LOAN PROVISIONS <br /> <br /> 1.1 The Loan <br />(a) Loan Terms. <br /> <br />(1) Loan Amount. City agrees to lend the Loan to Borrower in the <br />amount of Eight Hundred Thousand Dollars ($800,000), of which up to Fifty Thousand Dollars ($50,000) may be used for pre-development costs (the “Predevelopment Component”). The Loan is evidenced by the Note, which shall be dated as of the Agreement Date and executed by <br />Borrower substantially in the form attached hereto as Exhibit B. <br /> <br />(2) Loan Interest. Commencing on the date of initial disbursement of the proceeds of the Loan and continuing through the date that all indebtedness and other amounts <br />payable under this Agreement and the Note are paid in full, interest on the Loan shall accrue at <br />the rate of one percent (1%) per annum on the unpaid principal outstanding from time to time. <br />Provided that Borrower is not in default under this Agreement, interest will be forgiven in <br />accordance with Section 1.1(d) below <br /> (b) Term. Subject to Section 1.1(d) below, all principal outstanding under the <br />Note, together with interest accrued thereon, is due and payable on the twentieth anniversary of <br />the Agreement Date (the “Maturity Date”). <br /> <br /> (c) Repayment. The Loan principal and interest, if any, is due and payable upon an Event of Default under Article 6 hereof, following the expiration of any applicable <br />notice and cure periods. <br /> <br />(d) Forgiveness. Provided that no Event of Default is uncured and <br />continuing, commencing on the first anniversary of the Agreement Date, and continuing on each anniversary thereafter through the Maturity Date (each, an “Anniversary Date”) (1) the outstanding principal amount of the Loan shall be reduced by Forty-Thousand Dollars ($40,000) <br />and forgiven by the City; and (2) all interest accrued to such Anniversary Date shall be forgiven <br />by the City. Provided that no Event of Default is uncured and continuing, all remaining Loan <br />principal and interest accrued thereon shall be forgiven by the City at the Maturity Date and this Agreement shall terminate. The City shall also forgive any funds disbursed to Borrower pursuant to Section 1.2 below in the event that this Agreement is terminated by Borrower pursuant to <br />Section 4.5. <br />(e) Prepayment. The Note or any portion of the outstanding principal balance <br />due under the Note may be prepaid at any time, and from time to time, without penalty or premium. <br /> (f) Security. The Loan and Note shall be unsecured. <br /> <br /> 1.2 Conditions Precedent to City’s Obligation to Disburse Predevelopment <br />Component. The obligation of City to disburse the proceeds of the Loan, in an amount not to <br />128