Two subnets can not exist on the same VPC with the same CIDR. Because CloudFormation creates new resources then deletes old ones, if you change AvailabilityZones you will need to choose a new CIDR for that AZ for the update.
For example, if you update the third AZ in your AvailabilityZones parameter you will need to choose new, non-conflicting value(s) for Subnet2CIDR (and SubnetPrivate2CIDR if you are in Private=Yes mode)
Once the update completes, you will need to re-deploy any Generation 1 applications on your Rack. Please be very careful with this update because if it rolls back it can leave your app in a broken state (the old subnets will not be there for it to roll back to)