GROUND LEASE - RIDGE VIEW COMMONS II

of actual uses as shown on the final cost certificate for the Project. Notwithstanding the foregoing, with City's prior written approval, Borrower may use Excess Proceeds to fund Project reserves or to reduce the principal balance of the Project's permanent loan. For the purpose of calculating Excess Proceeds, Project sources of funding shall take into consideration any reduction or increase in equity contributions by the Investor Limited Partner, including any additional contribution due to an upward credit adjustor. In the event that any "upward credit adjuster" is paid to Borrower that has not been included in the calculation of Excess Proceeds pursuant to this Section, one-half of any such amount shall be paid to City as a reduction of the outstanding principal balance of this Note within thirty (30) days after Borrower's receipt of such funds. If other public agency lenders require payment of Excess Proceeds, then Excess Proceeds shall be allocated among the City and such lenders pro rata in proportion to each lender's financial contribution to the Project. 1.5 DUE ON SALE. The entire unpaid principal balance and all interest and other sums accrued hereunder shall be due and payable upon the Transfer absent City consent, of all or any part of the Project or the Property or any interest therein other than a Transfer permitted without City consent pursuant to the Ground Lease or the Regulatory Agreement. Without limiting the generality of the foregoing, this Note shall not be assumable without City's prior written consent, which consent may be granted or denied in City's sole discretion. 1.6 RESYNDICATION/REFINANCING. Borrower shall pay to City as a reduction of the outstanding balance of this Note, the amount equal to fifty percent (50%) of the Net Proceeds of Project refinancing or resyndication in accordance with this Section. For purposes of this Section "Net Proceeds" means all proceeds of refinancing or resyndication less: (a) the amount used to repay the refinanced debt, (b) reasonable out-of-pocket expenses Borrower is required to pay to third parties in connection with the refinancing or resyndication, including fees and closing costs reasonably incurred by Borrower, (c) the reasonable costs paid by Borrower to rehabilitate, construct and install capital improvements to the Project as approved by City in writing (including without limitation reasonable architects' and engineers' fees incurred in connection with such capital improvements), (d) any reasonable increase in Project reserves that Borrower is required to fund as a condition to such refinancing or resyndication, provided that Borrower actually funds such reserves and such reserves are held for Borrower's benefit by a third -party financial institution, (e) if applicable, the amount required to be paid to purchase the Investor Limited Partner's interest in the Partnership (plus any taxes, fees, and amounts due to the Investor Limited Partner) provided that the Investor Limited Partner that is being replaced is not affiliated with Eden, and provided further that such amount does not exceed the fair market value of such interest as reasonably and customarily determined for such interests in partnerships that own and operate affordable housing developments financed with low-income housing tax credits and located in the greater San Francisco Bay Area, and (f) other uses of proceeds approved by City in the exercise of City's sole discretion. All Net Proceeds shall be used to pay down the outstanding balance of this Note and such other purposes as City may approve in writing in the exercise of City's discretion. If other public agency lenders require payment of Net Proceeds, then Net Proceeds shall be allocated among the City and such lenders pro rata in proportion to each lender's financial contribution to the Project. 1.7 PREPAYMENT. Borrower may, without premium or penalty, at any time and from time to time, prepay all or any portion of the outstanding principal balance due under this Note, provided that each such prepayment is accompanied by accrued interest on the amount of principal prepaid calculated to the date of such prepayment. Prepayments shall be applied first to any unpaid late charges and other costs and fees then due, then to accrued but unpaid interest, and then to D-1 4859-3312-3005v5