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• • D. The HUD Loan will be evidenced by that certain Mortgage Note (the "HUD Note ") executed by Developer in favor of Lender in the original principal amount of the Loan and will be secured in part by (i) that certain Mortgage dated July 1, 2010 (the "HUD Mortgage ") executed by Developer in favor of Lender, and by (ii) the Regulatory Agreement for Multifamily Housing Projects dated July 1, 2010 (the "HUD Regulatory Agreement ") executed by and between Landlord and the Secretary of Housing and Urban Development. The HUD Note, the HUD Mortgage, the HUD Regulatory Agreement and all other loan and security documents executed in connection with the Loan are collectively referred to herein as the "HUD Loan Documents." E. As a condition to the making of the Loan to Developer, Lender and HUD require that the Development Contract be amended to include certain HUD provisions and that the Development Contract be subordinated to the Loan and the HUD Loan Documents. F. In connection with the assignment of the Development Contract from the Prior Developer to Developer, the parties have further agreed to modify the Development Contract in certain respects as described herein. G. In addition, the parties have determined to replace certain restrictive covenants (referred to in the Development Contract as the "Covenants ") with a new Declaration of Covenant and Restriction of even date herewith, in the form attached as Exhibit B to this Agreement (the "Replacement Covenant "). NOW, THEREFORE, in consideration of foregoing recitals and of the mutual covenants and agreements hereinafter set forth, it is agreed by and between Developer and the Authority as follows: 1. Status of Development Contract. This Development Agreement remains in full force and effect, and is not modified except as expressly provided in this Agreement. Should there be any conflict or inconsistency between this Agreement and the Development Contract, the terms and conditions of this Agreement shall prevail. 2. Amendment to Development Contract. The Development Contract is hereby amended to add following Section 8.7 of the Development Contract entitled "Subordination" the following Article 9: ARTICLE IX HUD REQUIREMENTS Section 9.1. Notwithstanding anything in this Agreement to the contrary, except the requirements in 26 U.S.C. 42(h)(6)(E)(ii), this Agreement is expressly subordinate to (i) the Mortgage Note dated as of dated July 1, 2010 (the "HUD Note ") executed by the Developer in favor of Dougherty Mortgage LLC, a Delaware limited liability company ( "Lender "), (ii) the Mortgage dated July 1, 2010 (the "HUD Mortgage ") executed by the Developer in favor of Lender, (iii) the Regulatory Agreement for Multifamily Projects dated July 1, 2010 (the "HUD 368750v2 SJB LN140 -25