25F - AGMT - 605-611 EAST WASHINGTON ST LOAN

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trust has not exercised its option to construct, the Agency shall have the right but no obligation to cure the default. In such event, the Agency shall be entitled to reimbursement from Developer of all proper costs and expenses incurred by the Agency in curing such default. The Agency shall also be entitled to a lien upon the Property to the extent of such costs and disbursements. Any such lien shall be junior and subordinate to the mortgages or deeds of trust pursuant to this Section 311. 311.6 Changes Requested by Holder. In the event that a lender or Holder which has been approved pursuant to this Section 311, et seq., requires one or more amendments to this Agreement, or any of the attachments hereto, the Agency agrees to reasonably consider approving such proposed amendment, and if such proposed amendment(s) does not materially affect the Agency's interests hereunder, the Agency Executive Director or his or her designee is hereby authorized to make such amendment(s) without further authorization from the Agency. 311.7 Subordination of Affordability Restrictions. In the event the Executive Director finds that an economically feasible method of financing for the construction and operation of the Project without the subordination of the Affordability Restrictions is not reasonably available, Executive Director may agree to subordinate the covenants contained in the Regulatory Agreement and the lien of the Loans to the Senior Loan, the Bond Regulatory Agreement and/or the Tax Credit Regulatory Agreement, subject to the terms of this Section 311.7. Each and any subordination agreement evidencing or affirming Agency's and City's subordination of the Affordability Restrictions entered into by Agency and/or City shall contain written commitments which the Executive Director finds are reasonably designed to protect Agency's and City's investment in the Project in the event of default; any such subordination agreement(s) shall contain contractual obligation of such Senior Lender to include, without limitation, the following: (a) concurrent delivery to Agency and City of a true copy of each and any notice provided by the Senior Lender for the Project to Developer (as its borrower) during the term of the Senior Loan for the Project; (b) a reasonably extended cure period and right to Agency and City to cure and assume the Senior Loan, and/or other senior lien(s) for the Project upon the same terms applicable to the approved financing to Developer pursuant to the loan documents applicable thereto with such right, but with no obligation, to the Agency and City being available both from the date of issuance of any notice of default through and after the recordation of a formal Notice of Default by the Senior Lender for the Project pursuant to applicable California Code of Civil Procedure foreclosure requirements, and (c) a right of Agency and City to cure a default on each of the senior loan(s) for the Project prior to foreclosure and after recordation of a Notice of Default pursuant to applicable California Code of Civil Procedure requirements; and such cure rights may also include: (d) a right of Agency and City to negotiate with the Senior Lender(s) for the Project after notice of default from the Senior Lender(s) and prior to foreclosure, (e) an agreement that if prior to foreclosure of the Senior Loan for the Project, Agency or City takes title to the Property and cures the default on the senior loan(s) for the Project, the Senior Lender(s) will not exercise any right it may have to accelerate the Senior Loan by reason of the transfer of title to Agency or City, and (f) a right of Agency and City to acquire Developer's interest in the Property from Developer at any time after a material default on the Senior Loan for the Project. 18 25F-24