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<br />Section 2.7 PredeveloDment Loan Cancellation. <br /> <br />Upon execution of this Agreement and pursuant to Section 1.6(a) of the Predevelopment <br />Loan Agreement, the Predevelopment Loan Agreement shall terminate. The City shall cancel <br />the promissory note evidencing the Predevelopment Loan and return such promissory note to <br />Borrower. Any advances under the Predevelopment Loan shall be considered as advances of <br />funds under the Loan. <br /> <br />Section 2.8 Conditions Precedent to Disbursement. <br /> <br />Upon satisfaction of the following conditions, the City shall disburse any remaining Loan <br />proceeds to the Bond Trustee for Borrower's use: <br /> <br />(a) The Borrower has acquired the Leasehold Estate; <br /> <br />(b) There exists no Default nor any act, failure, omission or condition that would <br />constitute an event of be fault under this Agreement. <br /> <br />(c) Borrower has executed and delivered to the City this Agreement, the Note, the <br />Regulatory Agreement and the Deed of Trust; <br /> <br />(d) The Borrower has furnished the City with evidence of the insurance coverage <br />meeting the requirements of Section 4.8 below. <br /> <br />(e) A title insurer reasonably acceptable to the City is unconditionally and <br />irrevocably committed to issuing an ALTA Lender's Policy of title insurance insuring the priority <br />of the Deed of Trust in the amount ofthe Loan, subject only to the Lease, deeds of trust securing <br />Approved Financing and the regulatory agreements associated with the Approved Financing and <br />such other exceptions and exclusions as may be reasonably acceptable to the City, and <br />containing such endorsements as the City may reasonably require. <br /> <br />(f) The Deed of Trust and the Regulatory Agreement have been recorded against the <br />Leasehold Estate in the Office of the Recorder of Alameda. <br /> <br />(g) The City has received and approved the general contractor's construction contract <br />that the Borrower has entered or proposed to enter for construction of the Project as required <br />pursuant to Section 3.2 below. <br /> <br />(h) The City has received copies oflabor and material (payment) bonds and <br />performance bonds as required pursuant to Section 3.3 below. <br />, <br /> <br />Section 2.9 Non-Recourse. <br /> <br />City's sole recourse in the event of a default by Borrower shall be to the Leasehold Estate, <br />and the Borrower shall not have any personal liability for the Loan. <br /> <br />ARTICLE 3 CONSTRUCTION OF THE PROJECT <br /> <br />8 <br /> <br />144\105\217525.14 <br />