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Service Charges on the Bonds shall be due and payable, whether at maturity, upon redemption, mandatory
tender, acceleration or otherwise, in an amount equal to those Bond Debt Service Charges.
If payment or provision for payment in accordance with the Indenture is made in respect of the
Bond Debt Service Charges on the Bonds from money other than Loan Payments, this Promissory Note
shall be deemed paid to the extent such payments or provision for payment of Bonds has been made.
Consistent with the provisions of the immediately preceding sentence, the Borrower shall have credited
against its obligation to make Loan Payments any amounts transferred from the Project Fund or the
Collateral Fund to the Bond Fund. Subject to the foregoing, all Loan Payments shall be in the full amount
required hereunder.
All Loan Payments shall be made to the Trustee at its designated corporate trust office for the
account of the Issuer and deposited in the Bond Fund created by the Indenture. Except as otherwise
provided in the Indenture, the Loan Payments shall be used by the Trustee to pay the Bond Debt Service
Charges on the Bonds as and when due.
The obligation of the Borrower to make the payments required hereunder shall be absolute and
unconditional and the Borrower shall make such payments without abatement, diminution or deduction
regardless of any cause or circumstances whatsoever including, without limitation, any defense, set-off,
recoupment or counterclaim which the Borrower may have or assert against the Issuer, the Trustee or any
other person.
This Promissory Note is subject to optional prepayment by the Borrower on the terms stated in the
Loan Agreement.
Whenever an Event of Default under Section 7.01 of the Indenture shall have occurred and, as a
result thereof, the principal of and any premium on all Bonds then Outstanding, and interest accrued
thereon, shall have been declared to be immediately due and payable pursuant to Section 7.03 of the
Indenture, the unpaid principal amount of and any premium and accrued interest on this Promissory Note
shall also be due and payable in Federal Reserve funds on the date on which the principal of and premium
and interest on the Bonds shall have been declared due and payable; provided that the annulment of a
declaration of acceleration with respect to the Bonds shall also constitute an annulment of any
corresponding declaration with respect to this Promissory Note.
The payment obligations of this Promissory Note are non-recourse to the Borrower to the extent
set forth in Sections 8.10 and 8.11 of the Loan Agreement.
The Borrower, Trustee and Issuer acknowledge that, after closing of the FHA Insured Mortgage
Loan, this Promissory Note, and all Borrower’s obligations hereunder, will be subject and subordinate to
the FHA Loan Documents: (i) Note (Multistate), dated as of July 1, 2026, from Borrower to FHA Lender,
initially endorsed for mortgage insurance by the United States Department of Housing and Urban
Development (“HUD”) pursuant to Section 221(d)(4) of the National Housing Act, as amended (the “FHA
Note”); (ii) Multifamily Mortgage, Security Agreement, Assignment of Rents, Fixture Filing (Virginia),
dated as of the date of the FHA Note, from Borrower for the benefit of FHA Lender to secure the FHA
Note (the “FHA Mortgage”); (iii) Regulatory Agreement for Multifamily Projects, dated as of the date of
the FHA Note, between Borrower and HUD (the “HUD Regulatory Agreement”); and (iv) any and all other
documents, agreements, or instruments which evidence or secure the indebtedness evidenced by the FHA
Note. Notwithstanding any provision in this Promissory Note to the contrary, this Promissory Note shall
not be due and payable prior to the maturity date of the FHA Note, provided that it may be prepaid at any
time from (A) Surplus Cash (as defined in the HUD Regulatory Agreement), (B) funds that are not derived
from revenues of the Project (as defined in the FHA Mortgage), the proceeds of the FHA Note, or any
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