When Recorded Mail To:
Preferred Bank
9350 Flair Avenue, Suite 425
El Monte, California 91731
Attention: Note Department
(Space Above For Recorder’s Use)
CONFIRMATION OF SUBORDINATION AND INTERCREDITOR AGREEMENT THIS CONFIRMATION OF SUBORDINATION AND INTERCREDITOR AGREEMENT is entered into as of October 1, 2022 by EAGLE HESPERIA 55 LP, a California limited partnership ("Borrower"); PREFERRED BANK, a California banking corporation ("Bank"); and HESPERIA HOUSING AUTHORITY, a public body, corporate and politic ("Authority").
RECITALS
A. On July 13, 2016 Borrower issued $8,160,000 of its Taxable Variable Rate Demand Multifamily Housing Revenue Bonds (The Villas Hesperia Project) 2016 Series A (as increased as described in Recital B below, the "Bonds"). The Bank issued its Irrevocable Letter of Credit dated July 13, 2016 to the trustee for the holders of the Bonds for the account of Borrower to support payments with respect to the portion of the Bonds then issued (as amended, the "Letter of Credit"). The Letter of Credit was issued and maintained by the Bank pursuant to the Reimbursement Agreement dated as of July 1, 2016 between the Issuer and the Bank (the "Original Reimbursement Agreement"). Borrower's obligations are secured by the Construction Deed of Trust, Security Agreement, Assignment of Rents and Fixture Filing dated as of July 1, 2016 executed by Borrower for the benefit of Bank, which was recorded on July 15, 2016 as Instrument No. 2016-0281596 in the real property records of San Bernardino County (as modified, the "Deed of Trust").
B. Concurrently with Borrower's issuance of the Bonds, Authority made a loan to Borrower in the amount of $3,831,975. Borrower's obligations with respect to such loan are secured by the Deed of Trust, Assignment of Leases and Rents, Fixture Filing and Security Agreement; Request for Notice dated as of July 13, 2016 executed by Borrower for the benefit of Authority, which was recorded on July 15, 2016 as Instrument No. 2016-0281597 in the real property records of San Bernardino County (the "Subordinate Deed of Trust").
C. Concurrently with entering into this Confirmation, (1) Borrower is issuing $2,000,000 of additional Bonds (such that the amount of the Bonds will equal $10,160,000), (2) Bank is increasing the amount of the Letter of Credit to $10,290,271, (3) Borrower and Bank are amending, restating and replacing the Original Reimbursement Agreement by entering into the Amended and Restated Reimbursement Agreement (the "Amended and Restated Reimbursement Agreement"), and (4) Borrower and Bank are modifying the Deed of Trust.
D. In connection with Borrower and Bank entering into the Deed of Trust and Borrower and Authority entering into the Subordinate Deed of Trust, the Borrower, Bank and Authority also entered into the Subordination and Intercreditor Agreement dated as of July 1, 2016, which was recorded on July 15, 2016 as Instrument No. 2016-0281599 in the real property records of San Bernardino County (the "Subordination Agreement").
E. The parties wish to enter into this Confirmation to consent to and confirm the transactions referred to in Recital C above.
AGREEMENT
1. Defined Terms. Capitalized terms used without definition in this Confirmation have the meanings given them in the Subordination Agreement.
2. Consent.
(a) Authority consents to: (i) Borrower's issuance of additional Bonds in the amount of $2,000,000; (ii) Bank's amending the Letter of Credit to increase its amount to $10,290,271; (iii) Bank and Authority's entering into the Amended and Restated Reimbursement Agreement; (iv) the "Guarantors" executing and delivering the "Guaranty" (as both terms are defined in the Amended and Restated Reimbursement Agreement); (v) Borrower and Bank entering into a Modification of Deed of Trust concurrently with this Confirmation; and (vi) all of the other transactions and arrangements referred to in and contemplated by the Amended and Restated Reimbursement Agreement. (b) Authority confirms to Bank that Authority has received and reviewed complete, final copies of the Amended and Restated Reimbursement Agreement and all of the documents and matters contemplated by it.
3. Confirmation of Subordination.
(a) Authority confirms the Subordination Agreement to Bank and agrees that the subordination provided for in Section 1 of the Subordination Agreement remains in full force and effect. (b) Bank confirms the Subordination Agreement to Authority and agrees that the subordination provided for in Section 4 of the Subordination Agreement remains in full force and effect.
4. Remaking Representations and Warranties. Borrower, Bank and Authority remake to each other as of the date of this Confirmation the representations and warranties set out in Section 9 of the Subordination Agreement.
5. Counterparts. This Confirmation may be executed in any number of original counterparts, each of which shall be deemed an original, but all of which when taken together shall constitute one instrument. The original signature page of any counterpart may be detached from such counterpart and attached to any other counterpart identical to such counterpart (except having additional signature pages executed by other parties to this Agreement) without impairing the legal effect of any such signature(s).
6. Entire Agreement. This Confirmation constitutes the entire agreement and understanding between and among the parties in respect of the subject matter of this Confirmation and supersede all prior agreements and understandings with respect to such subject matter, whether oral or written.
7. Severability. If any part of this Confirmation is declared invalid for any reason, such shall not affect the validity of the rest of the Confirmation. The other parts of this Confirmation shall remain in effect as if this Confirmation had been executed without the invalid part. The parties declare that they intend and desire that the remaining parts of this Confirmation continue to be effective without any part or parts that have been declared invalid. [Signature pages on the following pages.]
BANK:
PREFERRED BANK,
a California banking corporation
By: __________________________
Nancy J. Pepper
Senior Vice President
BORROWER:
EAGLE HESPERIA 55 LP, a California limited partnership
By: Eagle Hesperia 55 LLC, a Delaware limited liability company Its: Co-General Partner
By: Eagle Real Estate Investment Group LLC, a Delaware limited liability company Its: Manager
By: Eagle Real Estate Investment Manager LLC, a Delaware limited liability company Its: Manager
By: __________________________________
Randall J. Friend, Manager
By: AHA Inland MGP, LLC, a California limited liability company Its: Managing General Partner
By: Affordable Housing Access, Inc., a California nonprofit public benefit corporation Its: Sole Member and Manager
By: ___________________________________
William W. Hirsch, Chief Executive Officer
AUTHORITY:
HESPERIA HOUSING AUTHORITY, a public body, corporate and politic By:
Nils Bentsen
Executive Director
ATTEST:
By:
Melinda Sayre
Authority Secretary
APPROVED AS TO FORM:
ALESHIRE & WYNDER, LLP
By:
Eric L. Dunn
Authority Counsel
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
State of California
)
County of Los Angeles
)
On ____________________, before me, ____________________________, a Notary Public, personally appeared _______________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
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Signature Page to Confirmation of Subordination and Intercreditor Agreement W:\Working\16908\19\W0500262.DOCX