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SUBORDINATION AGREEMENT <br />(Amended and Restated Development Assistance Agreement) <br />THIS SUBORDINATION AGREEMENT (Amended and Restated Development <br />Assistance Agreement) (this “Agreement”) is made as of this ____ day of August, 2024, by the <br />between and the CITY OF ELK RIVER, MINNESOTA, a statutory city organized and existing <br />under the laws of the State of Minnesota (the “City”), in favor of FIRST BANK ELK RIVER, a <br />Minnesota state banking corporation (together with its successors and assigns, “FBER”). <br />RECITALS <br />A. Pursuant to a certain Construction Loan Agreement dated of even date herewith by <br />and among Jade Elk Properties LLC, a Minnesota limited liability company (“HoldCo”) and <br />Heritage Millwork, Inc., a Minnesota corporation (“OpCo” and together with HoldCo, <br />collectively, the “Borrowers”) and FBER, FBER has agreed to make construction loans available <br />to Borrowers in the aggregate maximum principal amount of up to $17,554,000.00 (collectively, <br />the “FBER Loans”) to finance a portion of the costs of constructing and equipping an <br />approximately 113,000 square foot industrial warehouse facility (the “Improvements”) on certain <br />real property located in Elk River, Minnesota and legally described on Exhibit A attached hereto <br />(the “Property”) (the Property and the Improvements are collectively, the “Project”). The FBER <br />Loans are evidenced by (i) that certain Promissory Note No. 1 dated of even date herewith, <br />executed and delivered by Borrowers and payable to the order of FBER in the original principal <br />amount of $12,730,000.00 (“FBER Note No. 1”), and by that certain Promissory Note No. 2 dated <br />of even date herewith, executed and delivered by Borrowers and payable to the order of FBER in <br />the original principal amount of $4,824,000.00 (“FBER Note No. 2” and together with Note No. <br />1, collectively, the “FBER Notes”). <br />B. FBER Note No. 1 is secured by, among other things, a certain Mortgage, Security <br />Agreement and Fixture Financing Statement dated of even date herewith, executed by HoldCo in <br />favor of FBER, encumbering the Property (as such mortgage may be amended, modified or <br />supplemented, “FBER Mortgage No. 1”). <br />C. FBER Note No. 2 is secured by, among other things, a certain Mortgage, Security <br />Agreement and Fixture Financing Statement dated of even date herewith, executed by HoldCo in <br />favor of FBER, encumbering the Property (as such mortgage may be amended, modified or <br />Page 219 of 327