Agmt21 ROEM Project at 353 Main - Laserfiche WebLink

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ARTICLE 3. LOAN PROVISIONS Section 3.1 Loan Amount. Subject to the terms and conditions set forth in the City Documents, the City hereby agrees to make a loan to the Developer of up to Three Million Five Hundred Thousand Dollars ($3,500,000). The Developer's obligation to pay the Loan shall be evidenced by the Promissory Note. Section 3.2 Interest. Simple interest at three percent (3%) per annum shall accrue on the principal amount of the Loan except in a Developer Event of Default, whereupon and during the continuation of which interest shall accrue from and after the date of the Promissory Note until paid at the rate of ten percent (10%) compounded annually, or the highest rate permitted by law. Section 3.3 Use of Loan. The Loan shall be used solely for the construction and permanent financing in accordance with the Financing Plan approved by the City (which includes among other costs, reimbursements for construction costs previously paid with County Loan funds). The Developer may not use any proceeds of the Loan for any other purpose without the prior written consent of the City. Section 3.4 Securit • Subordination of Regulatory Agreement. (a) The City agrees to subordinate the Deed of Trust to other Approved Financing (in each case, a "Senior Lien"), but only on condition that all of the following conditions are satisfied: (1) All the proceeds of the proposed Senior Lien, less any transaction costs, must be used to provide acquisition, construction or permanent financing for the Development, or any combination thereof. (2) The proposed lender (each, a "Senior Lender") must be a state or federally chartered financial institution, a nonprofit corporation or a public entity that is not affiliated with the Developer or any of DeveIoper's affiliates, other than as a depositor or a lender. (3) Developer must demonstrate to the City's reasonable satisfaction that subordination of the Deed of Trust is necessary to secure adequate construction, rehabilitation and/or permanent financing to ensure the viability of the Development, including the operation of the Development as affordable housing, as required by this Agreement. To satisfy this requirement, Developer must provide to the City, in addition to any other information reasonably required by the City, evidence demonstrating that the proposed amount of the Senior Loan is necessary to provide adequate construction, rehabilitation and/or permanent financing to ensure the viability of the Development, and adequate financing for the Development would not be available without the proposed subordination. REV: 06-17-2020 PR 1199\09\2727850.8 ATTY/AGR.2020.100/353 Main Street Apartments LP (Page 23 of 143)