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(4) The subordination agreement(s) must be structured to minimize the risk that the Deed of Trust would be extinguished as a result of a foreclosure by the Senior Lender or other holder of the Senior Lien. To satisfy this requirement, the subordination agreement must provide the City with adequate rights to cure any defaults by Developer, including: (i) providing the City or its successor with copies of any notices of default at the same time and in the same manner as provided to Developer; and (ii) providing the City with a cure period of at least sixty (60) days to cure any default. (5) The subordination(s) described in this Section may be effective only during the original term of the Senior Loan and any extension of its term or refinancing approved in writing by the City, and to any refinancing of the Senior Loan as approved by the City subject to the City's ability to make the findings required under Health and Safety Code Section 33334.14(a). (6) No subordination may limit the effect of the Deed of Trust before a foreclosure, nor require consent of the holder of the Senior Loan to exercise any remedies by the City under the City Documents. (7) Upon a determination by the City Manager that the conditions in this Section have been satisfied, the City Manager or his/her designee will be authorized to execute the approved subordination agreement without the necessity of any further action or approval. (b) In no event shall the City subordinate the Regulatory Agreement. Section 3.5 Repayment Schedule. The Loan shall be repaid as follows: (a) Term. The Loan shall have a term that expires on the date fifty-seven (57) years from the Close of Escrow (the date on which the Regulatory Agreement is recorded against the Property). (b) Payments. Commencing on the May 1 first occurring after the Fiscal Year in which the Improvements are completed pursuant to this Agreement, and on each May 1 thereafter throughout the term of the Loan, the Developer shall make repayments of the Loan equal to its pro -rata share of the Lender's Share of Residual Receipts (based upon the principal balance of all residual receipt loans), if any. The Developer shall provide the City in a form to be provided by the City, within sixty (60) days following the end of each of the Developer's Fiscal Year, a report showing the actual income and expenditures with respect to the Development for the immediately preceding Fiscal Year, the calculation of Annual Operating Expenses, Gross Revenue, and Residual Receipts and the status of all reserve funds, including without limitation, an annual audited financial statement for the Development prepared by a certified public accountant reasonably approved by the City. Payments made shall be credited first against accrued interest and then against outstanding principal. REV: 06-17-2020 PR 1199\09\2727850.8 ATTY/AGR.2020.100/353 Main Street Apartments LP (Page 24 of 143)