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requirement related to the Levee Improvements work (collectively, a "Deficiency") and (ii) fails to cure a Deficiency within forty-five (45) days following written notice from City of such Deficiency; or, if such Deficiency is not curable within such forty-five (45) day period, then within such period as is reasonably necessary to accomplish such cure provided that within the forty-five (45) day period, SCOA presents City with a written plan acceptable to City to cure the Deficiency (which acceptance will not be unreasonably withheld) and thereafter cures the Deficiency according to such plan (a "Default"). The remedies available to City for a Default will depend on whether the event of Default occurs prior to or following commencement of the Levee Improvements construction work. (a) Default Prior to Commencement of Work. In the event SCOA Defaults prior to commencement of the Levee Improvements construction work, City may, in its discretion, with or without abandoning the Levee Improvements project, declare that SCOA and Owners have no further rights under the Agreement (or any related Encroachment Permit) to implement the Levee Improvements project. If the City elects to continue the Levee Improvements project, City may use any available funds to perform the Levee Improvements construction work by contract or other method City considers advisable including, without limitation in its sole election, by succeeding to SCOA's position under any or all of SCOA's Design and Construction Agreements, including without limitation all bid bonds, the Construction Contract, and General Contractor bonds. If City opts to succeed to SCOA's position under any or all of SCOA's Design and Construction Agreements and/or bonds then City, as SCOA's successor, may exercise all rights and seek all recourse reasonably available to City under any such assumed Design and Construction Agreements and/or bonds. SCOA, within 10 days following City's demand, will assign any such Design and Construction Agreements and/or bonds to City at no cost to City except as hereinafter specified in this subdivision (a). If City opts to continue the Levee Improvements project and perform the work of constructing the Levee Improvements, then no Acquisition Price shall be paid but City, from the proceeds of Special Taxes collected by City, shall pay to SCOA, in the manner and within the time specified in the Purchase Contract, SCOA's actual out-of-pocket costs incurred in connection with preparation of Final Construction Documents, which have been delivered to City, if any, less any costs City has accrued that have not already been reimbursed, and Owners and their successors in interest shall remain obligated to pay all Special Taxes and Assessments imposed in connection with the construction and maintenance of the Levee Improvements. City may take all necessary steps to preserve City's rights, as SCOA's successor, under any such assumed Design and Construction Agreements and /or bonds. (b) Default Following Commencement of Work. In the event SCOA Defaults following commencement of the Levee Improvements construction work, City shall have the right to pursue one or more of the following remedies: i. Declare that SCOA and Owners have no further rights under this Agreement (or any related Encroachment Permit) to proceed with construction of the Levee Improvements; ii. Exercise its rights under the improvement security issued by SCOA's surety and SCOA will pay any sums owed to SCOA's surety for performance of SCOA's OAK #4819-4834-1908 v20 27