4 - AMEND / RESTATE REGULATORY AMENDMENT_2018-12-18 (2)

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EXHIBIT 1 on any Bond to become includable in the gross income of the recipients thereof for federal income tax purposes. Notwithstanding the above, the Issuer hereby acknowledges and consents to the transfer of the Project to the General Partner pursuant to that certain Option Agreement dated as of December 18, 1996 between the General Partner and the Borrower. It is hereby expressly stipulated and agreed that any sale, transfer or other disposition of the Project in violation of this Section 10 shall be null, void and without effect, shall cause a reversion of title to the Borrower, and shall be ineffective to relieve the Borrower of its obligations under this Regulatory Agreement. Nothing in this Section 10 shall affect any provision of any other document or instrument between the Borrower and any other party which requires the Borrower to obtain the prior written consent of such other party in order to sell, transfer or otherwise dispose of the Project. Not less than 30 days prior to consummating any sale, transfer or disposition of any interest in the Project, the Borrower shall deliver to the Issuer and the Trustee a notice in writing explaining the nature of the proposed transfer. Upon the written assumption of the Borrower's obligations hereunder, the Borrower shall no longer remain liable for its obligations hereunder to the extent of any interest so assigned. Any syndication by the Borrower of the Project shall be in compliance with any applicable requirements of the Act, and (i) the terms and conditions of the syndication shall not reduce or limit any of the requirements of the Act or regulations adopted or documents executed pursuant to the Act, (10 no requirements of the Issuer shall be subordinated to the syndication agreement, and (iii) the syndication shall not result in the provision of fewer assisted units, or the reduction of any benefits or services, than were in existence prior to the syndication agreement. Section 11. Term. Subject to the following paragraph of this Section 11, this Regulatory Agreement and all and several of the terms hereof shall become effective upon its execution and delivery and shall remain in full force and effect during the Qualified Project Period, it being expressly agreed and understood that the provisions hereof are intended to survive the retirement of the Bonds and expiration, termination or cancellation of the Indenture, the Mortgage Note or the Financing Agreement. Notwithstanding any other provisions of this Regulatory Agreement to the contrary, this entire Regulatory Agreement, or any of the provisions or sections hereof, may be terminated upon agreement by the Issuer, the Trustee and the Borrower subject to compliance with any of the provisions contained in this Regulatory Agreement only if there shall have been received an opinion of Bond Counsel that such termination will not adversely affect the exclusion from gross income for federal income tax purposes or the exemption from State personal income taxation of the interest on the Bonds. The Borrower shall provide notice of any termination of this Regulatory Agreement to the Trustee and the Lender. The terms of this Regulatory Agreement to the contrary notwithstanding, this Regulatory Agreement, and all and several of the terms hereof, shall terminate and be of no further force and effect in the event of (i)(a) involuntary noncompliance with the provisions of this Regulatory Agreement caused by a foreclosure of the lien of a deed of trust on the Project or delivery of a deed in lieu of foreclosure whereby a third party shall take possession of the Project or (i)(b) involuntary non-compliance with the provisions of this Regulatory Agreement caused by fire, seizure, requisition, change in a federal law or an action of a federal agency after the date hereof which prevents the Issuer and the Trustee from enforcing the provisions hereof or condemnation or a similar event, and (ii) either (A) in each case, the payment in full and retirement of the (or extinguishment in accordance with the terms of the Indenture) of the Bonds, each theretofore or within a reasonable period thereafter or (B) in each case, an opinion of Bond Counsel is delivered to the Issuer to the effect that such termination will not adversely affect the exclusion from gross income for federal income tax purposes of interest on the Bonds; provided, however, that the preceding provisions of this sentence shall cease to apply and the restrictions contained herein shall be reinstated if, at any time 15 4-19