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Bond Purchase Agreement to the contrary, no obligations of the Borrower hereunder shall be payable except
from (A) Surplus Cash (as defined in the HUD Regulatory Agreement), (B) funds that are not derived from
(i) revenues of the Project (as defined in the FHA Mortgage), (ii) the proceeds of the FHA Note, or (iii) any
reserve or deposit made with the FHA Lender or any other party as required by HUD in connection with
the FHA Loan Documents, or (C) FHA Lender Funds which have been deposited into the Collateral Fund
by or at the direction of the FHA Lender (collectively, “Non-Project Sources”). No claims or actions shall
be made (or payable) under this Bond Purchase Agreement against the Project, the FHA Lender, the
proceeds of the FHA Note, or the assets of the Borrower, except from Non-Project Sources. In addition, the
rights and obligations of the parties under this Bond Purchase Agreement and all other documents
evidencing, implementing, or securing this Bond Purchase Agreement (collectively, the “Subordinate Bond
Documents”) are and shall be subordinated in all respects to the rights and obligations of the parties to and
under the FHA Loan Documents. In the event of any conflict between the provisions of (i) this Bond
Purchase Agreement or the Subordinate Bond Documents and (ii) the provisions of the FHA Loan
Documents or the Program Obligations, the provisions of the FHA Loan Documents or the Program
Obligations shall control. The provisions of this Section shall control over any inconsistent provisions in
this Bond Purchase Agreement or the Subordinate Bond Documents.
SECTION 20. Establishment of Issue Price for the Bonds
(a) The Underwriter agrees to assist the Issuer in establishing the issue price of the Bonds and
shall execute and deliver to the Issuer at Closing an “issue price” or similar certificate, together with the
supporting pricing wires or equivalent communications, substantially in the form attached hereto as Exhibit
C, with such modifications as may be appropriate or necessary, in the reasonable judgment of the
Underwriter, the Issuer and Bond Counsel, to accurately reflect, as applicable, the sales price or prices or
the initial offering price or prices to the public of the Bonds.
(b) Except as otherwise set forth in Schedule I attached hereto, the Issuer will treat the first
price at which 10% of each maturity of the Bonds (the “10% test”) is sold to the public as the issue price of
that maturity (if different interest rates apply within a maturity, each separate CUSIP number within that
maturity will be subject to the 10% test). At or promptly after the execution of this Bond Purchase
Agreement, the Underwriter shall report to the Issuer the price or prices at which it has sold to the public
each maturity of Bonds (excluding any Bonds which remain unsold).With respect to the Bonds for which
the 10% test has not been satisfied as set forth in Schedule I, the Underwriter will neither offer nor sell
unsold Bonds of that maturity to any person at a price that is higher than the initial offering price to the
public during the period starting on the sale date and ending on the earlier of the following:
(1) the close of the fifth (5th) business day after the sale date; or
(2) the date on which the Underwriter has sold at least 10% of that maturity of the
Bonds to the public at a price that is no higher than the initial offering price to the public.
The Underwriter shall promptly advise the Issuer when it has sold 10% of that maturity of the
Bonds to the public at a price that is no higher than the initial offering price to the public, if that occurs
prior to the close of the fifth (5th) business day after the sale date.
(c) The Underwriter confirms that any selling group agreement and any retail distribution
agreement relating to the initial sale of the Bonds to the public, together with the related pricing wires,
contains or will contain language obligating each dealer who is a member of the selling group and each
broker-dealer that is a party to such retail distribution agreement, as applicable, to (A) report the prices at
which it sells to the public the unsold Bonds of each maturity allotted to it until it is notified by the
Underwriter that either the 10% test has been satisfied as to the Bonds of that maturity or all Bonds of that
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