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(d) The Borrower shall have the right to prepay the Loan at any time and no prepayment penalty will be charged to the Borrower for payment of all or any portion of the Loan amount prior to the end of the Term. Section 2.4 Use of Loan Funds. The Borrower shall use the Loan to assist with the development of the HELP- Assisted Units in the Project. The Borrower shall not use the Loan funds for any other purposes without the prior written consent of the City. Section 2.5 Securi.. (a) Borrower shall secure its obligation to repay the Loan, as evidenced by the Note, by executing the Deed of Trust, and, upon acquisition of the Leasehold Estate, recording it as a lien against the Leasehold Estate. (b) The City agrees to subordinate the Deed of Trust and the Regulatory Agreement to the liens of the deeds of trust securing the Approved Financing and to any regulatory agreement associated with the Approved Financing. The City further agrees that such subordination shall, if required by the lender of any Approved Financing, include an agreement by the City to exercise the remedies under the Loan Documents only upon consent from such lender of Approved Financing. Section 2.6 Conditions Precedent to Disbursement. Upon satisfaction of the following conditions, the City shall disburse any remaining Loan proceeds to the Bond Trustee for Borrower's use: (a) The Borrower has acquired the Leasehold Estate; (b) There exists no Default nor any act, failure, omission or condition that would constitute an event of Default under this Agreement. (c) Borrower has executed and delivered to the City this Agreement, the Note, the Regulatory Agreement and the Deed of Trust; (d) A title insurer reasonably acceptable to the City is unconditionally and irrevocably committed to issuing an ALTA Lender's Policy of title insurance insuring the priority of the Deed of Trust in the amount of the Loan, subject only to the Lease, documents related to and securing the Bond Loan, the deed of trust and regulatory agreement recorded in connection with the Other City Loan, the Regulatory Agreement and such other exceptions and exclusions as may be reasonably acceptable to the City, and containing such endorsements as the City may reasonably require. (e) The Deed of Trust and the Regulatory Agreement have been recorded against the Leasehold Estate in the Office of the Recorder of Alameda. HELP Loan 6 144 \105\272256.4