Item 16 - Affordable Housing Project at 801, 807, 809 and 809 ½ E. Santa Ana Blvd

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Agency Loan proceeds shall not be used for any purpose other than for the purposes stated above, including Developer fee and soft costs related to the lease, development construction, ownership, occupancy and operation of the Project (as set forth in the Project Budget or otherwise subject to Agency’s prior review). 4.3 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 Agreement. (d) Developer shall have provided construction security in favor of the Agency, which may include a completion guarantee from Developer 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. (e) Developer shall submit and obtain the City Project Manager’s approval of the construction contract, the identity and qualifications of the General Contractor and management, marketing and tenant selection plans for the Project. 4.4 Termination for Failure of Condition. If (a) any of the conditions set forth herein are not timely satisfied pursuant to the Schedule of Performance (subject to extension for Force Majeure Events and the expiration of applicable notice and cure rights), and (b) Agency is not in default under this Agreement, Agency may terminate this Agreement without any further liability on its part by giving written notice of termination to Developer. Upon the giving of such notice, all principal, interest and other amounts owing under the Agreement shall be due and payable. 4.5 Any Disbursement. Agency's obligation to make any disbursement of the Loan, including the first and final disbursements, is subject to the satisfaction of the following conditions precedent: (a) Satisfactory Progress. The City Project Manager shall be satisfied that, based on his/her own inspections or other reliable information, the construction is progressing satisfactorily in conformance with all applicable laws. EXHIBIT 4