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ARTICLE 7. DEFAULT AND REMEDIES Section 7.1 General Applicability. The provisions of this Article shall govern the parties' remedies for breach or failure of this Agreement. Section 7.2 Fault of City. (a) The following events each constitute a "City Event of Default" and a basis for the Developer to take action against the City: (1) The City breaches any material provision of this Agreement (including failure to timely respond to performance time frames set forth in this Agreement). (b) Upon the happening of any of the above-described events, the Developer shall first notify the City in writing of its purported breach or failure, giving the City forty-five (45) days from receipt of such notice to cure or, if cure cannot be accomplished within forty-five (45) days, to commence to cure such breach, failure, or act. In the event the City does not then so cure within said forty-five (45) days, or if the breach or failure is of such a nature that it cannot be cured within forty-five (45) days, the City fails to commence to cure within such forty- five (45) days and thereafter diligently complete such cure within a reasonable time thereafter but in no event later than one hundred twenty (120) days, then the Developer shall be afforded all of its rights at law or in equity, by taking all or any of the following remedies: (1) terminating in writing this Agreement (provided, however, that the indemnification provisions of this Agreement shall survive such termination and remain in full force and effect); and (2) prosecuting an action for damages or specific performance. Section 7.3 Fault of Developer. (a) The following events each constitute a "Developer Event of Default" and a basis for the City to take action against the Developer: (1) The Developer fails to exercise good faith and diligent efforts to satisfy, within the time set forth in the Development Schedule and in the manner set forth in Article 2, one or more of the conditions precedent to the City's obligation to make the Loan to the Developer; (2) The Developer constructs or attempts to construct the Improvements in violation of Article 4; (3) The Developer has not satisfied all preconditions set forth in this Agreement to commencement of construction of the Improvements by the Close of Escrow, or fails to commence or complete construction of the Improvements within the times set forth in Article 4, or abandons or suspends construction of the Improvements prior to completion of all construction for a period of sixty (60) days after written notice by the City of such abandonment or suspension; REV: 06-17-2020 PR 1199\09\2727850.8 ATTY/AGR.2020.100/353 Main Street Apartments LP (Page 48 of 143)