BLP PARTNERSHIP LAND DISPOSITION

The Developer shall have obtained a commitment for a construction loan in an amount sufficient to construct the Improvements on terms which take into consideration the Affordable Rents. Section 2.5 Financing Plan. The Developer shall have submitted for City review a Financing Plan containing the following: (1) a"sources and uses" breakdown of the costs of constructing the Improvements, and(2) an operating proforma for the Development. Such sources and uses breakdown and operating proforma shall reflect the Developer's then current expectations for funding sources, development costs, and operating expenses. The purpose of the City review shall be to determine whether the developer's estimates of costs and net operating income indicate that the construction and operation of the Improvements will be in done accordance with this Agreement and the proposed City Ground Lease. Section 2.6 Failure to Obtain Financing. In the event after making a good faith effort, Developer is unable to obtain financing acceptable to the Developer and the City by December 31, 2002, either Party may terminate this Agreement by providing written notice to the other Party and thereafter neither Party shall have any rights against or liability to the other under this Agreement ARTICLE 3 DISPOSITION OF PROPERTY Section 3.1 Lease. Provided the pre-disposition requirements set forth in Article 2 have been satisfied,the City shall lease to the Developer, and the Developer shall lease from the City, the Property pursuant to the terms, covenants, and conditions of this Agreement and the City Ground Lease. The Parties intend to negotiate a City Ground Lease and a Regulatory Agreement. The form of the negotiated City Ground Lease will be attached to this Agreement as Exhibit B. The form of Regulatory Agreement will be attached to this Agreement as Exhibit C. If the Parties are unable to negotiate the terms of a City Ground Lease and a Regulatory Agreement, this Agreement may be terminated as set forth in Section 8.2. Section 3.2 Lease Payments. The Lease payments for the Property shall be One Dollar ($1)per year. Section 3.3 Opening Escrow. To accomplish the lease and transfer of a leasehold interest in the Property from the City to the Developer, the Parties shall establish the Escrow with the Title Company. The Parties shall execute and deliver all written instructions to the Title Company to accomplish the terms of this Agreement and the City Ground Lease, which instructions shall be consistent with this Agreement. Section 3.4 Close of Escrow. Escrow for the conveyance of a leasehold interest in the Property pursuant to the City Ground Lease shall close on a date mutually acceptable to the Parties within thirty(30) days following the date on which all conditions precedent to conveyance set forth in Article 2 have been satisfied or such later date agree upon by the Parties. In addition to the 144\105\105296.4 5