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a. Any payments received by the City pursuant to the terns hereof shall be <br />applied first to sums, other than principal and interest, due the City pursuant to this Note, next to <br />the payment of all interest accrued to the date of such payment, and the balance, if any, to the <br />payment of principal. <br />b. If any payment is not received by the City within ten (10) days following the <br />due date thereof, then in addition to the remedies conferred upon the City pursuant to this Note <br />and the other Loan Documents, (i) a late charge of four percent (4%) of the amount due and <br />unpaid will be added to the delinquent amount to compensate the City for the expense of <br />handling the delinquency and (ii) the amount due and unpaid, excluding the late charge, shall <br />bear interest at the highest annual rate which may lawfully be charged and collected under <br />applicable law on the obligation evidenced by this Note, computed from the date on which the <br />amount was due and payable until paid. Without prejudice to the rights of the City hereunder or <br />under any of the other Loan Documents, Borrower shall indemnify the City against, and shall <br />pay the City on demand, any expense or loss which it may sustain or incur as a result of the <br />failure by Borrower to pay when due any installment of interest and/or principal, fees, or other <br />amounts payable to the City under this Note or any other Loan Document, to the extent that any <br />such expense or loss is not recovered pursuant to such foregoing provisions. A certificate of the <br />City setting forth the basis for the determination of the amounts necessary to indemnify the City <br />in respect of such expenses or direct loss, submitted to Borrower by the City, shall be conclusive <br />and binding for all purposes except as immediately corrected by Borrower notice to City. <br />14. Security <br />This Note is secured by the City Deed of Trust. <br />15. Acceleration by Reason of Transfer or Financing. <br />a. In order to induce City to make the loan evidenced hereby, Borrower <br />agrees that in the event of any transfer of the Property without the prior written consent of City <br />(other than a transfer resulting from a foreclosure, or conveyance by deed in lieu of foreclosure, <br />by the holder of the Senior Loan Deed of Trust), City shall have the absolute right at its option, <br />without prior demand or notice, to declare all sums secured hereby immediately due and payable. <br />Consent to one such transaction shall not be deemed to be a waiver of the right to require consent <br />to future or successive transactions. City may grant or deny such consent in its sole discretion <br />and, if consent should be given, any such transfer shall be subject to this Section 15, and any <br />such transferee shall assume all obligations hereunder and agree to be bound by all provisions <br />contained herein. Such assumption shall not, however, release Borrower from any liability <br />thereunder without the prior written consent of City. <br />b. As used herein, "transfer" includes the Sale, agreement to sell, transfer or <br />conveyance of the Property, or any portion thereof or interest therein, whether voluntary, <br />involuntary, by operation of law or otherwise, the execution of any installment land sale contract <br />or similar instrument affecting all or a portion of the Property, or the lease of all or substantially <br />all of the Property. 'Transfer' shall not include the leasing of individual residential units on the <br />7 <br />25B-57 <br />