3 - LOAN AGREEMENT FOR AMCAL_2018-01-16 (2)

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EXHIBIT 3 (k) Representations and Warranties. The representations and warranties of Developer contained in this Agreement and the other Loan Documents shall be correct in all material respects as of the Close of Escrow as though made on and as of that date and Agency shall have received a certificate to that effect signed by Developer's Representative. (1) No Default. No Event of Default by Developer shall have occurred, and no event shall have occurred which, with the giving of notice or the passage of time or both, would constitute an Event of Default by Developer under this Agreement, and if requested by the City Project Manager, Agency shall have received a certificate to that effect signed by Developer's Representative. (m) The Agency's obligation to provide the Agency Loan is and shall remain subject to all covenants, conditions, and restrictions set forth in this Loan Agreement, and in particular Agency's analysis of the available funding sources and development and operating costs of the Project and the overall economic feasibility of the Project. 6.2 Disbursement Procedures for Loan. The Agency Loan proceeds shall be disbursed through Escrow to finance the acquisition, development and construction of the Project (as evidenced in Exhibit E). The Agency Loan proceeds shall not be used for any purpose other than for acquisition and predevelopment and construction related costs, including Developer fee and soft costs related to the development of the Project (costs all subject to Agency's prior review). 6.3 First Disbursement. Agency's obligation to make the first disbursement of the Loan is subject to satisfaction of the following conditions precedent: (a) All grading permits shall have been issued or the City shall have issued a letter stating that building permits are ready to issue, subject only to payment of fees and the completion of grading of the Project site. (b) Developer shall have secured all necessary financing and funding for the construction and operation of the Project. Such financing and funding shall be sufficient to pay all Project development costs, through lease -up, as set forth in the final budget consistent with the approved Proforma (or as otherwise approved by the Agency). (c) Developer shall have provided evidence to the Agency that the Developer has obtained insurance policies and certificates or endorsements acceptable to the Agency, as described in this Loan Agreement. (d) Developer shall have provided construction security in favor of the Agency, which may include a completion guarantee from AMCAL Multi -Housing, Inc. and/or a letter of credit and/or performance and payment bonds from the general contractor for the Project (or some combination of these), in an amount sufficient to ensure the Project will be completed and placed in service within the time set forth in the Project schedule approved by the Agency. 11 3-21