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. . __1 .._.... . _......'_" ... . . ..-..K«�.�...�..�.�s.._ . . :�.. encumbrance associated with financing of the Project that is approved by the City under this Agreement shall be deemed a Permitted Encumbrance. In the event the City disapproves of Developer's evidence of Equity Investment and Loan or Developer is unable to obtain and deliver such evidence of fmancing commitments to the City as provided above, then either party may terminate this Agreement as provided herein by giving written notice to the other party, and thereafter neither party shall have any further rights or obligations hereunder. 6.2 No Prohibited Encumbrances. The Developer shall not record or allow to be recorded against all or any portion of the Site or the Project any mortgage, deed of trust, encumbrance or lien that is a Prohibited Encumbrance. The Developer shall remove or cause to be removed any Prohibited Encumbrance made or recorded against all or any portion of the Site or the Project or shall assure the complete satisfaction of any such Prohibited Encumbrance to the satisfaction of the City. The covenants of the Developer set forth in this Section 6.2 ' regarding the placement of encumbrances against the Project or the Site shall run with the land and bind successive owners of the Site, until issuance of a Certificate of Completion for the ' Project, whereupon such abligations shall terminate. Any encumbrance not spec�cally approved by the City prior to the issuance of a Certificate of Completion shall be deemed a Prohibited Encumbrance. 6.3 City Right to Discharge Prohibited Encumbrances. After sixty (60) calendar days prior written Notice to the Developer, and provided that the Developer has not satisfied or removed the subject Prohibited Encumbrance (or is the subject Prohibited Encumbrance is not susceptible of satisfaction or removal within such sixty-day period, the Developer fails to commence the satisfaction or removal of the subject Prohibited Encumbrance within such period and thereafter to prosecute diligently to completion), the City shall have the right, but not the obligation, to satisfy or remove any Prohibited Encumbrance against the Site or the Project and receive reimbursement from the Developer for any amounts paid or incurred in satisfying or ' removing any such Prohibited Encumbrance, upon demand. Any amount expended by the City ' to satisfy or remove any Prohibited Encumbrance that is not reimbursed to the City by the Developer within thirty (30) calendar days after written demand to�the Developer for such ' reimbursement, shall accrue interest from the date such expense was incurred by the City at the lesser of: (i)the rate of ten percent(10%)per annum; or(ii) the Usury Limit,wntil paid in full. 6.4 Developer Right to Contest Validity of Encumbrance. Developer may contest the validity of any Prohibited Encumbrance, and nothing in this Agreement shall require the ' Developer to pay or make provision for the payment of any t�, assessment, lien or charge associated with such Prohibited Encumbrance so long as Developer in good faith shall contest the validity or amount therein and so long as such delay in payment shall not subject the Site or the Project(or any portion thereofl to forfeiture or sale. 6.5 Rights of Lenders and City Regarding Permitted Encumbrances. � 6.5.1 No Effect on Rights or Remedies. Any Permitted Encumbrance shall not affect, limit or restrict the City's rights or remedies under this Agreement, except as expressly provided in this Agreement. Nothing contained in any Permitted Encumbrance shall 43 2013.118/BLOCK 2 HUNTER STORM REV:07-26-13 PT