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May 1, 2019 (the "A&R City Note"). The A&R City Note is secured by an Amended and <br />Restated Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing dated as of <br />May 1, 2019 (the "A&R City Deed of Trust") which will be recorded in the Official Records <br />substantially concurrently with the recordation of this Subordination Agreement. <br />E. To assist in financing the rehabilitation of the Project, City has made or will make a loan to <br />Borrower in the principal amount of Five Hundred Thousand Dollars ($500,000) (the "New City <br />Loan"). The New City Loan is evidenced by an Affordable Housing Loan Agreement dated as of <br />May 1, 2019 and executed by the City and the Borrower (the "New City Loan Agreement"), and <br />a Secured Promissory Note executed by Borrower for the benefit of City and dated as of May 1, <br />2019 (the "New City Note"). Repayment of the New City Loan is secured by a Deed of Trust, <br />Assignment of Rents, Security Agreement and Fixture Filing dated as of May 1, 2019 (the "New <br />City Deed of Trust") which will be recorded in the Official Records substantially concurrently with <br />the recordation of this Subordination Agreement. In connection with the New City Loan, <br />Borrower and City entered into an Affordable Housing Regulatory Agreement and Declaration of <br />Restrictive Covenants dated as of May 1, 2019 (the "City Regulatory Agreement") which will be <br />recorded in the Official Records substantially concurrently herewith. <br />F. The Loan Modification Agreement, the A&R City Note, the A&R City Deed of Trust, the New City <br />Loan Agreement, the New City Note, the New City Deed of Trust, the City Regulatory <br />Agreement, and all other documents that evidence the Original City Loan or the New City Loan <br />are collectively referred to herein as the "City Loan Documents." <br />G. HIP has agreed to subordinate the lien of the Redwood Deed of Trust to the City Regulatory <br />Agreement, the Amended City Deed of Trust, and the New City Deed of Trust (collectively, the <br />"Senior Loan Documents"). <br />AGREEMENT <br />1. Subordination. The Senior Loan Documents and any and all renewals, modifications, <br />extensions, or advances thereunder or secured thereby (including interest thereon), are unconditionally <br />and will remain at all times, a lien, claim, or charge on the Property prior and superior to the Redwood <br />Deed of Trust. HIP acknowledges that it has had an opportunity to review the City Loan Documents, and <br />HIP intentionally subordinates the lien of the Redwood Deed of Trust to the Senior Loan Documents. <br />2. Amendments Require Consent. City agrees that it will not amend or modify the City <br />Loan Documents to shorten the maturity date, increase the principal amount, or increase the interest rate <br />payable under the City Loan Documents without HIP's prior written consent. HIP agrees that it will not <br />amend or modify the Redwood Loan Documents to shorten the maturity date, increase the principal <br />amount, or increase the interest rate payable under the Redwood Loan Documents without City's prior <br />written consent. <br />3. Notice and Cure Rights. <br />3.1 Definitions: For purposes of this Section 3, the following capitalized words and <br />terms shall have the following meanings. <br />"Defaulted Lender" means the party giving a Default Notice. <br />"Default Notice" means written notice of the default(s) or Event(s) of Default giving rise to a <br />party's right to complete a Foreclosure Remedy. <br />"Foreclosure Remedy" means the completion of a foreclosure sale of the Property or the <br />recording of a deed -in -lieu of foreclosure with respect to the Property. <br />Page 2 of 8 <br />REV: 05-29-19 VR <br />ATTY/AGR.2019.159/Redwood Oaks Associates 11 LP - HIP—City-Seller Subordination <br />