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(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, City shall have received a certificate to that effect signed by Developer's Representative. (in) The City's obligation to provide the Inclusionary Loan is and shall remain subject to all covenants, conditions, and restrictions set forth in this Loan Agreement, and in particular City'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 hiclusionary Loan proceeds shall be disbursed through Escrow to finance the acquisition, development and construction of the Project (as evidenced in Exhibit E). The Inclusionary 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 City's prior review). 6.3 First Disbursement. City'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 City). (c) Developer shall have provided evidence to the City that the Developer has obtained insurance policies and certificates or endorsements acceptable to the City, as described in this Loan Agreement. (d) Developer shall have provided construction security in favor of the City, which may include a completion guarantee from AMCAL Multi -Housing, hie. 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 City. (e) Developer shall submit and obtain the Executive Director of the Community Development Agency's approval of the construction contract, the identity and qualifications of the General Contractor, Developer's limited partnership agreement for the limited partnership entity to be formed to own and operate the Project, and management, marketing and tenant selection plans for the Project. I I 80A-1 7