Item 15 - Purchase and Sale Agreement Eagle Nest 6, LP — Yucaipa City Council, November 14, 2022

Agenda Item no. 15

YUCAIPA CITY COUNCIL

AGENDA REPORT
TO: Honorable Mayor and City Council
FROM: Ryan C. Miller, Housing and Economic Development Analys FOR: City Council Meeting of November 14, 2022
SUBJECT: Purchase and Sale Agreement - Eagle Nest 6, L.P. — .46-acre Parcel Northeast corner 5th Street and County Line Road (APN 0319-233-91).

RECCOMMENDATION:

That City Council:

1. Approve the Purchase and Sale Agreement with Eagle Nest 6, L.P., for the sale of the City -owned property located at Northeast corner of 5th Street and County Line Road (APN 0319-233-91) in the amount of $100,000; and

2. Approve a loan to Eagle Nest 6, L.P. in the amount of $170,247 plus any deferred City development fees, to be repaid over time though residual receipts.

3. Approve the attached Density Bonus Agreement (DBA) for the Eagle Nest 6, L.P. for 6 senior apartment units; and

4. Authorize the City Manager, or his designee, to execute the necessary documents to complete the property sale process.

BACKROUND / DISCUSSION:

On September 27, 2021, City Council Adopted Resolution number 2021-62, declaring real property owned by the City as surplus land and not necessary for the City's use. The parcel is located at the northeast corner of 51h Street and County Line Road and is approximately .46 acres.

The developer Eagle Nest 6, L.P., desires to construct a 6-unit Senior Housing Project that will function as an extension of an existing Senior Housing Development to the west called `The Villas', which is directly across the street and developed in partnership with the City of Yucaipa as Case No. 17-118/LUCR. Given the High Density Multiple -Residential (RM-24) Land Use Designation of that site, per Section 88.01301 of the Development Code, the 96-unit affordable senior housing development was permitted by right pursuant to the administrative review procedures contained in Development Code Section 83.030305 (Land Use Compliance Review).

The proposed 6-plex will be managed and maintained by the same property manager as `The -190-

Agenda Item no.

Villas' site. However, pursuant to the requirements of the RM-10M (Multiple Residential—10,000 sq. ft. minimum lot size) Land Use Designation of this subject site, a Conditional Use Permit and public hearing process were required for the current Project.

On October 20, 2021, The Planning Commission approved a Density Bonus Request, which includes three (3) regulatory concessions, a Variance Request, Conditional Use Permit No. 20- 128, Architectural Design, and conceptual landscaping, subject to the Conditions of Approval as contained in the Planning Commission agenda report dated October 20, 2021.

Density Bonus. -
The proposed Density Bonus Request is generally consistent with the RM-1OM Official Land Use District and the General Plan and Development Code standards for the Land Use District.

Additionally, the minimum two (2)-bedroom unit size, minimum private open space requirement, and minimum front yard setback reductions requested by the Developer as incentives are consistent with the City of Yucaipa's Density Bonus process with the associated affordability component.

Division 3, Chapter 1, Article 7 of the Yucaipa Development Code contains provisions for processing density bonus projects, which are designed to provide incentives for the production of housing for very low-income, low-income, moderate -income, and senior households in accordance with State Law, by allowing additional units to offset the costs of providing affordable housing.

The applicant has submitted a Density Bonus request to construct a senior housing facility.

Pursuant to the Yucaipa Development Code, a 100% increase in density is permitted for senior housing projects and the effective maximum density within the RM Land Use District for the proposed Project is 17.4 units per acre. Given that the subject property is 0.463 acres in size, this would allow for the proposed six (6) units associated with this Project.

Additionally, three incentives had been requested by the applicant and approved by the Planning Commission to reduce the minimum two (2)-bedroom unit size, the minimum private open space requirement in the form of a ground floor patio area or second floor balcony for each unit, and the minimum front yard setback. As per the Yucaipa Development Code, incentives, defined as a reduction in site development standards or a modification of the requirements of the City of Yucaipa Development Code, may be requested through the Density Bonus Agreement process if an applicant agrees to construct a certain percentage of their units as affordable. Section

83.010715(c)(3) details that three (3) incentives shall be provided to a developer who agrees to construct at least thirty (30) percent of the total units for low-income households, and fifteen (15) percent of the total units for very low-income households. Further, the applicant is proposing to abide by this affordability component that was approved by the Planning Commission, which included the following incentives:

1. Reduce the minimum two (2)-bedroom dwelling unit size per Yucaipa Development Code Section 88.0210(a) for two (2)-bedroom multi -family units from 900 square feet to 876 square feet; and

2. Reduce the minimum private open space requirement per Yucaipa Development Code Section 88.0210(e) for multi -family ground floor units from 150 square feet -191-

Agenda Item no.
to 96 square feet, and 100 square feet to 98 square feet for second floor units with balconies; and

3. Reduce the minimum front yard setback per Yucaipa Development Code Section

84.0330(c) for two-story multi -family units from 30 feet to 22.2 feet Before the Project is constructed, a formal Density Bonus Agreement is required to be approved by the City Council. This process is identified in the proposed Conditions of Approval and will set forth the reporting requirements and covenants that are necessary to ensure that the target affordability units remain available as intended by the density bonus request and incentives requested. Additionally, these requests reflect the smaller units/bedroom for an age -restricted Project, and the unique street frontage of the site to accommodate future roadway improvements.

City Loan and Deal Points. -
The deal points included in the PSA that establish the terms and conditions to implement the financing of the project are similar to those of previously approved agreements. These include the following:

1. The units must remain affordable for a 55-year period; and

2. The affordability covenants remain with the project for the 55-year term and then convert to a market rate project; and

3. The City's financial contribution (Development Impact Fee deferral, land value, and water improvement reimbursement) will be recorded as a loan due and payable at the end of the 55-year term, which will be paid annually out of the residual receipts.

Residual receipts revenue is the annual net Project revenue for the Development, after the operating expenses debt service, fees, etc. are deducted; and

4. The repayment of the City Loan will be achieved through the split of the project's residual receipts where Eagle receives 85% and the City receives 15%.

FISCAL IMPACT:

The surplus property was initially acquired by way of voluntary acquisition to provide necessary right of way for the County Line Road Corridor Improvement Project "County Line Road Project".

The County Line Road Project is included in the adopted fiscal year 2022/2023 Capital Improvement Program. The sale disposition of the surplus property will generate $100,000 in revenue, the proceeds generated from the land sale will be returned to the County Line Road Project.

The City will recapture, over time, reimbursement of $70,247 for previously completed water improvements that benefitted this property and others.
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Agenda Item no.

Based on a total number of six (6) new residential units on 0.463 acres, the Project can be expected to generate approximately $74,827.67 in Development Impact Fees, using the current fee schedule, as follows:

Drainage Facilities: $6,844.55
Traffic Facilities: $43,823.64
Public Facilities: $6,067.38
Fire Facilities: $5,497.26
Park Facilities: $12,594.84
TOTAL: $74,827.67
ATTACHMENTS: Purchase and Sale Agreement
APPROVED BY:
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AGREEMENT FOR PURCHASE AND SALE

AND ESCROW INSTRUCTIONS

THIS AGREEMENT FOR PURCHASE AND SALE AND ESCROW INSTRUCTIONS (this "Agreement") is dated as of , 2022, and is entered into by and between the CITY OF YUCAIPA ("Seller") and EAGLE NEST 6, L.P., a California limited partnership (`Buyer").

RECITALS
A. Seller is the owner of the land described on Exhibit "A" (the "Property"), bearing property tax parcel number (APN) 0319-233-91 in Yucaipa, California.

B. Buyer desires to purchase the Property from Seller, and Seller desires to sell the Property to Buyer.

NOW, THEREFORE, in consideration of $5.00 and for other valuable consideration, the sufficiency of which is hereby acknowledged, Buyer and Seller hereby agree as follows:

SALE, PURCHASE PRICE; COMPLETION DATE.

1.1 Sale and Purchase. Seller agrees to sell the Property to Buyer and Buyer agrees to purchase the Property upon the terms and conditions hereafter set forth.

1.2 Purchase Price. The purchase price ("Purchase Price") for the Property shall be the higher amount of ONE HUNDRED THOUSAND and NO/100 Dollars or the fair market value as determined by an appraisal dated no earlier than six (6) months prior to close of escrow, which shall be loaned by the Seller to the Buyer on the terms set forth in the forms of Promissory Note and Deed of Trust attached hereto as Exhibit `B" (to be executed and delivered by Buyer at the Close of Escrow, as defined in Section 4.3 below). Seller shall defer Seller's development/impact fees (but not permit fees) for the development on the Property; Seller shall in effect make a loan of such fees, which are described in and shall be paid in accordance with the Promissory Note; however, in no event shall any fees be deferred to the extent they must be distributed by Seller to any other governmental entity.

1.3 Reimbursement for Water Improvements. Buyer agrees to reimburse Seller for costs of certain water improvements previously completed, which improvements benefited the Property, in the amount of $70,247.00. Seller agrees to make a loan to Buyer for the reimbursement amount of $70,247.00, which amount shall be included as outstanding principal under the Promissory Note in addition to the Purchase Price per paragraph 1.2 above, and shall be paid in accordance with the Promissory Note.

1.4 "AS IS" Sale; No Representations or Warranties. Seller is selling the Property to Buyer in its current "AS IS" condition, without representation or warranty, express or implied; however, neither the foregoing nor the release in Section 3.3 below shall affect any obligation of Seller under applicable law to disclose material facts about the Property known to Seller and not known to Buyer.
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1.5 Project Completion Date; Post Closing Restriction on Transfer. Buyer shall complete the 6 unit housing project described in the Density Bonus Agreement, attached hereto as Exhibit "C", by the deadline for completion set forth in Section 9(e) thereof. Buyer shall not convey the Property prior to completion of said Project.

TTTLF._

2.1 General. Title to the Property shall be conveyed by a grant deed in the form attached hereto as Exhibit "D" (which includes the restriction on transfer described in Section 1.4 above) and shall be evidenced by a Standard Coverage Form of Owner's Policy of Title Insurance or if elected by Buyer, extended coverage title insurance ("Title Policy"). The Title Policy shall be issued by the escrow holder described in Section 4.2 in its capacity as a title company ("Title Company"), with liability in the full amount of the Purchase Price, insuring title to the Property as vested in Buyer, free and clear of all liens and encumbrances and other matters affecting title to the Property, except the following (which shall constitute "Approved Title Exceptions" under Section 2.4 below):

2.1.1 Assessment installments not yet due (prorated).

2.1.2 Such other matters as are approved or deemed approved by Buyer.

2.2 Acts After Date of Agreement. During the period from the date of this Agreement until the Close of Escrow, Seller shall not record or permit to be recorded any document or instrument relating to the Property, except Seller shall have the authority to record a covenant or restriction related to affordable housing requirements as may be required to comply with the Surplus Land Act (Govt. Code §§ 54220 et seq.).

2.3 Title Review. Upon the execution and delivery of this Agreement, Buyer shall obtain a current title report from Title Company for the Property and copies of the title exception documents and, except as otherwise provided in Section 2.1 above, Buyer shall have the right to disapprove the title report and title exceptions and terminate this Agreement based on such disapproval by written notice to Seller given by the Inspection Deadline (as defined in Section 3.1 below).

RIGHT OF ENTRY; INSPECTIONS; RELEASE.

3.1 Seller hereby grants Buyer and its agents, employees, contractors and subcontractors (collectively "Representatives") the right to enter the Property for the purpose of conducting soils and geological investigation, testing for toxic or hazardous substances and other contamination, and other inspections at Buyer's expense. If Buyer desires to terminate this Agreement as a result of its inspection, Buyer may do so in its sole and absolute discretion by written notice to Seller given at least three (3) business days prior to the deadline for the Close of Escrow (the "Inspection Deadline").

3.2 Buyer shall defend, indemnify, and hold Seller harmless from and against any and all damages, costs, expenses, liabilities, claims, demands, causes of action, proceedings, expenses, judgments, penalties, liens, and losses of any nature whatsoever ("Claims"), including fees of accountants, attorneys, expert witnesses, or other professionals, and all costs associated 10070-0142\2740954v5.doe -2-
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therewith, arising or claimed to arise, in connection with the entry by Buyer or its consultants upon the Property.

3.3 Buyer hereby waives, releases and discharges the Seller from all present and future claims, demands, suits, legal and administrative proceedings and from all liability for damages, losses, costs, liabilities, fees and expenses, including attorneys' fees, court and litigation costs and fees of expert witnesses, present and future, arising out of or in any way connected with the Property, including any hazardous materials in, on or under the Property (except that such release shall not apply to releases of hazardous substances by Seller after Buyer's inspections of the Property).

In connection with the foregoing, Developer acknowledges that it is aware of and familiar with the provisions of Section 1542 of the California Civil Code that provides as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS

WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO

EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING

THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST

HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT
WITH THE DEBTOR."
Buyer Initials:

4. ESCROW.

4.1 Agreement to Constitute Escrow Instructions. This Agreement shall constitute escrow instructions and a copy hereof shall be deposited with the Escrow Holder for that purpose.

4.2 Escrow Holder. The escrow shall be opened with Stewart Title of California ("Escrow Holder" and "Title Company"), within five (5) business days after the execution of this Agreement by Buyer and Seller delivering a copy of this Agreement to Escrow Holder and obtaining an escrow number (which shall be given by the party obtaining it to the other party).

This document shall be considered as the escrow instructions between the parties, with such further instructions as Escrow Holder requires in order to clarify the duties and responsibilities of Escrow Holder.

4.3 Close of Escrow. For the purposes of this Agreement, "Close of Escrow" shall be the date on which the grant deed for the Property in favor of Buyer is recorded in the Official Records of the San Bernardino County Recorder's Office. Provided all of Seller's and Buyer's obligations to be performed on or before Close of Escrow have been performed and all the conditions to the Close of Escrow set forth in this Agreement have been satisfied, escrow shall close as soon as reasonably possible, but no later than January 17, 2023 ("Closing Date"). All risk of loss or damage with respect to the Property shall pass from Seller to Buyer at the Close of Escrow. Possession of the Property shall be delivered to Buyer upon the Close of Escrow.

4.4 Seller Required to Deliver. Before the Close of Escrow, Seller shall deposit into escrow the following:
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4.4.1 A grant deed conveying the Property to Buyer, in the form attached hereto as Exhibit "D", duly executed by Seller and acknowledged (the "Grant Deed");

4.4.2 A counterpart of the density bonus agreement in the form attached hereto as Exhibit "C" (the "DBA"), duly executed by Seller and acknowledged;

4.4.3 A Certificate of Acceptance of Deed of Trust executed by Seller, as attached hereto as part of Exhibit "B";

4.4.4 The covenant or restriction to be recorded against the Property to comply with the requirements of the Surplus Land Act substantially as attached hereto as Exhibit "E". (Govt. Code § § 54220 et seq. ); and,

4.4.5 Any other documents contemplated by this Agreement, or reasonably required by Escrow Holder or Title Company to be deposited by Buyer to carry out this escrow.

Upon written request of Buyer, with copies of the applicable construction loan documents, Seller's City Manager shall have the authority to execute and deliver a reasonable, acknowledged subordination agreement subordinating the City's deed of trust (but not the density bonus agreement) to a deed of trust securing construction financing for the project to be completed on the Property that is consistent with the density bonus agreement (and to permanent financing that repays such construction financing, but does not exceed the outstanding amount of such financing plus closing costs payable by the buyerlborrower). The preceding sentence shall survive the Close of Escrow.

4.5 Buyer Required to Deliver. On or before the Close of Escrow, Buyer shall deposit into escrow the following (properly executed and acknowledged, if applicable):

4.5.1 The Promissory Note and Deed of Trust in the forms attached hereto as Exhibit "B";

4.5.2 Net costs to be paid by Buyer under Section 4.9 below;

4.5.3 A counterpart of the DBA, duly executed by Buyer and acknowledged; and

4.5.4 Any documents contemplated by this Agreement or reasonably required by Escrow Holder or Title Company to be deposited by Buyer to carry out this escrow.

4.6 Conditions to the Close of Escrow. Escrow shall not close unless and until both parties have deposited with Escrow Holder all sums and documents required to be deposited as provided in this Agreement, and Escrow Holder shall prepare a preliminary settlement statement showing all costs and any prorations for execution by both parties. Additionally, Buyer's obligation to proceed with the transaction contemplated by this Agreement is subject to the satisfaction of all of the following conditions precedent, which are for Buyer's benefit and may be waived only by Buyer:
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4.6.1 Seller shall have performed all agreements to be performed by Seller hereunder;

4.6.2 As of the Close of Escrow, there shall have been no material adverse changes in the physical condition of the Property since Buyer's inspection; and

4.6.3 Title Company shall have issued or shall have committed to issue the Title Policy to Buyer, for the amount of the Purchase Price, showing fee title to the Property to be vested in Buyer subject only to the Approved Title Exceptions.

If any of the conditions to Close of Escrow are not timely satisfied for a reason other than a default of Buyer or Seller under this Agreement, and this Agreement is terminated, then upon termination of this Agreement, Escrow Holder shall promptly return to Buyer all funds (and all interest accrued thereon) and documents deposited by Buyer in escrow and to return to Seller all funds and documents deposited by Seller in escrow and which are held by Escrow Holder on the date of the termination (less, in the case of the party otherwise entitled to such funds, however, the amount of any cancellation charges required to be paid by such party under Section

4.11 below).

4.7 Recordation of Documents; Delivery of Funds. Upon receipt of the funds and instruments described in this Section 4, Escrow Holder shall first cause the covenant or restriction required to comply with the requirements of the Surplus Land Act (Govt. Code § § 54220 et seq.) substantially as set forth in Exhibit E attached hereto, followed by the Grant Deed and then the DBA (with no intervening recordings) to be recorded in the office of the County Recorder of San Bernardino County, California. Thereafter, Escrow Holder shall deliver the proceeds of this escrow (less appropriate charges) to Seller.

4.8 Prorations. Any property assessments not yet due shall be prorated between Buyer and Seller as of the Close of Escrow based on the latest available tax information All prorations shall be determined on the basis of a 360-day year.

4.9 Costs of Escrow.

4.9.1 Seller shall pay:
(a) The premium for the CLTA Standard Title Policy;
(b) One-half ('/z) of the escrow fees;
(c) Documentary transfer taxes; and
(d) Recording charge, if applicable, and any other closing costs or charges not expressly provided for herein and customarily paid by a Seller of real property in San Bernardino County, California.

4.9.2 Buyer shall pay:
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(a) One-half ('/2) of the escrow fees;
(b) The extra cost of an ALTA extended title policy, if Buyer has so elected; and
(c) Any other closing costs or charges not expressly provided for herein and customarily paid by a Buyer of real property in San Bernardino County, California.

4.10 Broker's Commissions. Buyer and Seller represent to one another that no broker or finder has been engaged by it in connection with the transaction contemplated by this Agreement, or to its knowledge is in any way connected with such transaction. Each party covenants and agrees that any other broker fee or commission which may be due or payable in connection with the closing of the transaction contemplated by this Agreement through its dealings with a broker, trader or salesperson shall be borne solely by that party. Buyer agrees to indemnify, defend, protect and hold harmless Seller and its respective employees, agents, representatives, council members, attorneys, successors and assigns, from and against all claims of any agent, broker, finder or other similar party arising from or in connection with Buyer's communications with Broker or such other agent, broker, finder or similar party. Seller agrees to indemnify, defend, protect and hold harmless Buyer and its respective employees, agents, representatives, council members, attorneys, successors and assigns, from and against all claims of any agent, broker, finder or other similar party arising from or in connection with Seller's communications with any other agent, broker, finder or similar party.

4.11 Escrow Cancellation Charges. In the event that this escrow shall fail to close by reason of the default of either party hereunder, the defaulting party shall be liable for all escrow and title cancellation charges. In the event that the escrow shall fail to close for any other reason, each party shall pay one-half ('/z) of all escrow and title cancellation charges.

5. ATTORNEYS' FEES. In any action between Buyer and Seller seeking enforcement of any of the terms and provisions of this Agreement, the prevailing party in such action shall be awarded, in addition to damages, injunctive or other relief, its reasonable costs and expenses, not limited to taxable costs, reasonable attorneys' fees and reasonable fees of expert witnesses.

6. NOTICES. All notices, requests, demands and other communication given or required to be given hereunder shall be in writing and sent by first class United States registered or certified mail, postage prepaid, return receipt requested, or sent by a nationally recognized courier service such as Federal Express, duly addressed to the parties as follows:

To Buyer: Eagle Nest 6, L.P.
c/o Eagle Real Estate Group, LLC
1500 Quail Street, Suite 120
Newport Beach, California 92660
Attn: Randall J. Friend
To Seller: City of Yucaipa
12700 Yucaipa Boulevard
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Yucaipa, California 90650
Attention: City Manager
With copy to: Richards, Watson & Gerson
350 S. Grand Ave, 37th Floor
Los Angeles, California 90071
Attn: David Snow, Yucaipa City Attorney
Delivery of any notice or other communication hereunder shall be deemed made on the date indicated in the return receipt or courier's records as the date of delivery or as the date of first attempted delivery, if sent by mail or courier service. Any party may change its address for purposes of this Section by giving notice to the other party as herein provided.

7. ENTIRE AGREEMENT. This Agreement contains all of the agreements of the parties hereto with respect to the matters contained herein, and all prior or contemporaneous agreements or understandings, oral or written, pertaining to any such matters are merged herein and shall not be effective for any purpose. No provision of this Agreement may be amended, supplemented or in any way modified except by an agreement in writing signed by the parties hereto or their respective successors in interest and expressly stating that it is an amendment of this Agreement.

8. COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which shall constitute one and the same instrument.

9. EMAIL DELIVERY. This executed Agreement (and executed counterparts of this Agreement), may be delivered by email to [email protected] for Seller.

10. TIME OF THE ESSENCE. Time is of the essence of this Agreement.

11. THIRD PARTIES. Nothing contained in this Agreement, expressed or implied, is intended to confer upon any person, other than the parties hereto and their successors and assigns, any rights or remedies under or by reason of this Agreement.

12. SEVERABILITY. If any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision hereof, and this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein, unless such invalidity, illegality or unenforceability materially affects the economic terms of the transactions contemplated by this Agreement or the ability of either party to perform its obligations under this Agreement. In such case, either party may terminate this Agreement and the escrow upon written notice to the other party given no later than ten (10) business days after the party giving such notice becomes aware of such invalidity, illegality or unenforceability. In the event of such termination, all funds deposited with Escrow Holder by Buyer and any interest accrued thereon shall be returned to Buyer.
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13. ADDITIONAL DOCUMENTS. Each party hereto agrees to perform any further acts and to execute, acknowledge and deliver any further documents that may be reasonably necessary to carry out the provisions of this Agreement.

14. AUTHORITY OF CITY MANAGER. The City Manager of Seller may give any and all notices, consents and terminations hereunder on behalf of Seller provided they are in writing.

15. DUE AUTHORIZATION/EXECUTION. Upon execution hereof, each party shall promptly provide to the other party reasonable evidence of its due authorization of this Agreement.

16. 1031 COOPERATION. Seller shall reasonably cooperate with tax deferred exchange by Buyer if desired by Buyer provided Seller shall not be obligated to incur any costs in connection therewith and shall not be obligated to delay the closing.

17. ASSIGNMENT BY BUYER. Buyer may not assign this Agreement without Seller's written approval, in its sole and absolute discretion.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

SELLER:

CITY OF YUCAIPA,
a California municipal corporation
Ray Casey, City Manager
Attest:

Jennifer Crawford, City Clerk
APPROVED AS TO FORM:

Richards, Watson & Gershon
David Snow, City Attorney
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[Signatures continue on next page]
BUYER:

EAGLE NEST 6, L.P.,
a California limited partnership
By: AHA INLAND MGP, LLC,
a California limited liability company
By: Affordable Housing Access, Inc.,
a California nonprofit public benefit corporation,
its Sole Member and Manager
31 William W. Hirsch
Chief Executive Officer
By: EAGLE YUCAIPA 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
M.

Randall J. Friend
Manager
By: EAGLE YUCAIPA 55, LLC,
a Delaware limited liability company,
its Limited Partner
By: Eagle Real Estate Investment Manager, LLC,
a Delaware limited liability company,
its Manager
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EXHIBIT "A"

DESCRIPTION OF THE PROPERTY
THOSE PORTIONS OF PARCEL 2 OF PARCEL MAP NO. 2070 AS PER MAP RECORDED IN BOOK 21, PAGE 56, OF PARCEL MAPS, RECORDS OF SAN BERNARDINO COUNTY,

STATE OF CALIFORNIA, SAID PORTIONS MORE PARTICULARLY DESCRIBED AS FOLLOWS: COMMENCING AT THE CENTERLINE INTERSECTION OF COUNTY LINE ROAD WITH 5TH STREET (FORMERLY AVENUE A) PER SAID PLAT; THENCE ALONG THE CENTERLINE OF SAID 5TH STREET NORTH 0 DEG 00' 18" WEST 104.34 FEET; THENCE LEAVING THE CENTERLINE OF SAID 5TH STREET NORTH 89 DEG 59'42" EAST 44.00 FEET TO A POINT OF INTERSECTION WITH THE EASTERLY RIGHT-OF- WAY OF SAID 5TH STREET, SAID EASTERLY RIGHT-OF-WAY BEING PARALLEL WITH AND DISTANT 44.00 FEET EASTERLY OF THE CENTERLINE OF SAID 5TH STREET, SAID POINT OF INTERSECTION BEING THE TRUE POINT OF BEGINNING; THENCE LEAVING THE EASTERLY RIGHT-OF-WAY OF SAID 5TH STREET SOUTH 89 DEG 35' 13" EAST 215.80 FEET; THENCE SOUTH 00 DEG 00'27" WEST 124.45 FEET TO A

POINT OF INTERSECTION WITH A NON- TANGENT CURVE, CONCAVE SOUTHEASTERLY, HAVING A RADIUS OF 312.00 FEET, A RADIAL LINE PASSING THROUGH SAID POINT OF INTERSECTION BEARS SOUTH 14 DEG 14'59" WEST; THENCE 71.69 FEET NORTHWESTERLY ALONG SAID NON -TANGENT CURVE THROUGH A CENTRAL ANGLE OF 13 DEG 05'24" TO A POINT OF NON -TANGENT

INTERSECTION WITH THE NORTHERLY RIGHT-OF-WAY OF SAID COUNTY LINE

ROAD, SAID NORTHERLY RIGHT-OF-WAY BEING PARALLEL WITH AND DISTANT

44.00 FEET NORTHERLY OF THE CENTERLINE OF SAID COUNTY LINE ROAD, A RADIAL LINE PASSING THROUGH SAID POINT OF INTERSECTION BEARS SOUTH 01 DEG 05'24" WEST; THENCE ALONG THE NORTHERLY RIGHT-OF-WAY OF SAID COUNTY LINE ROAD NORTH 72 DEG 53'00" WEST 107.90 FEET TO A POINT OF

INTERSECTION WITH A NON -TANGENT CURVE, CONCAVE NORTHEASTERLY, HAVING A RADIUS OF 96.50 FEET, A RADIAL LINE PASSING THROUGH SAID POINT OF INTERSECTION BEARS NORTH 56 DEG 59'59" EAST; THENCE 22.10 FEET

NORTHWESTERLY ALONG SAID NON -TANGENT CURVE THROUGH A CENTRAL ANGLE OF 13 DEG 07'20" TO A POINT OF INTERSECTION WITH A TANGENT LINE; THENCE NORTH 29 DE 35'14" WEST 14.11 FEET TO THE BEGINNING OF A TANGENT CURVE, CONCAVE NORTHEASTERLY, HAVING A RADIUS OF 236.50 FEET; THENCE

56.55 FEET NORTHWESTERLY ALONG SAID TANGENT CURVE THROUGH A CENTRAL ANGLE OF 13 DEG 41' 58" TO A POINT OF NON -TANGENT INTERSECTION WITH THE EASTERLY RIGHT-OF-WAY OF SAID 5TH STREET, A RADIAL LINE

PASSING THROUGH SAID POINT OF NON -TANGENT INTERSECTION BEARS SOUTH 74 DEG 06'44" WEST; THENCE ALONG THE EASTERLY RIGHT-OF-WAY OF SAID 5TH STREET NORTH 00 DEG 00' 18" WEST 2.62 FEET TO THE TRUE POINT OF BEGINNING.

APN: 0319-233-91
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EXHIBIT "B"

PROMISSORY NOTE AND DEED OF TRUST
(Attached.)
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PROMISSORY NOTE
2022
Greater of $100,000.00 or appraised FMV of collateral; plus $70,247 for water improvement reimbursement; plus deferred City impact fees
Yucaipa, California
FOR VALUE RECEIVED, the undersigned ("Maker" or "Developer"), having its principal place of business at 1500 Quail Street, Suite 120, Newport Beach, California 92660, promises to pay to the order of the CITY OF YUCAIPA, a municipal corporation ("Payee" or "City"), at 34272 Yucaipa Boulevard, Yucaipa, California 92399, or at such other place as the holder of this Note from time to time may designate in writing, the principal sum of One Hundred and Seventy Thousand and Two Hundred and Forty -Seven and No/100 Dollars ($170,247), plus all City development/impact fees imposed in connection with the development on the property securing this Promissory Note (excluding any portions thereof which City must distribute to any other governmental entity, such portions remaining payable when imposed, and not deferred hereunder; and also excluding any permit fees) (the "Original City Principal Amount"), together with interest on the unpaid principal amount of this promissory note (the "City Loan Note") from time to time outstanding at the "Applicable Interest Rate," as defined below, in lawful money of the United States of America. "Applicable Interest Rate" means three percent (2.5%) per annum, simple interest, except that amounts not paid when due shall accrue interest from the date due until the date paid at the lesser of (i) seven percent (7%) per annum, simple interest, or (ii) the maximum rate permitted by applicable law.

As used in Section 1 below, the following capitalized terms shall have the meaning set forth below:
"Gross Revenues" means the sum of. the total rental income and all other revenues or income received by the Maker or its successors or assigns in connection with the Project, including without limitation Housing Rent, laundry charges (received by or payable for the benefit of Maker) or consideration received from an entity that contracts to provide laundry services, payments in connection with Section 8 certificates, if any (including payments under such certificates that are in excess of the restricted rents provided for herein), cable income or consideration received from an entity that contracts to provide cable services, each of (i) amounts paid to Maker or any affiliate on account of Operating Expenses for further disbursement by Maker or such affiliate to a third party or parties, including, without limitation, grants received to fund social services or other housing supportive services at the Project; (ii) late charges and interest paid on rentals; (iii) rents and receipts from licenses, concessions, vending machines, coin laundry, and similar sources; (iv) other fees, charges, or payments not denominated as rental but payable to Maker in connection with the renal of office, retail, storage, or other space in the Project; (v) consideration received in whole or in part for the cancellation, modification, extension or renewal of leases; and (vi) interest and other investment earnings on security deposits, reserve accounts and other Project accounts to the extent disbursed, but does not include: insurance proceeds actually applied to reconstruct or repair the Project, or Refinancing Net Proceeds.
10070-0142\27409544. do -3 -
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"Housing Rent" means the total of monthly payments by the tenants of a Unit for (a) use and occupancy for the Unit and facilities associated therewith, (b) any separately charged fees or service charges assessed by Maker which are required of all tenants of the Units, other than security deposits, (c) a reasonable allowance for utilities not included in (a) or (b) above, including garbage collection, sewer, water, electricity and gas, as determined by regulation of the Housing Authority of the County of San Bernardino pursuant to 24 C.F.R. Section 5.600 et seq., and (d) possessory interest, taxes or other fees or charges assessed for the use of the Units and facilities associated therewith by a public or private entity other than Maker; provided that the rent charged as to any Unit shall not exceed the limits in the Density Bonus Agreement. "Operating Expenses" means actual, reasonable and customary costs, fees and expenses directly incurred and for which payment has been made and which are attributable to the operation, maintenance, and management of the Project (but not any capital replacement reserve or other reserves), including without limitation the following (to the extent actual, reasonable and customary, and attributable to the operation, maintenance or management of the Project): painting, cleaning, repairs and alterations; landscaping; utilities; rubbish removal; sewer charges; costs incurred to third parties in connection with generating laundry charges (but in no event to exceed the laundry charges); real and personal property taxes and assessments; insurance premiums; security; advertising, promotion and publicity; office, janitorial, cleaning and building supplies; actual and customary salary payable to an on -site manager which directly and exclusively benefits residents of the Project; the actual and customary salary paid for one on -site maintenance manager and such other on -site management personnel, if any, which directly and exclusively benefit residents of the Project, a management fee ("Management Fee") (excluding any on -site management personnel) of not to exceed six percent (6%) of Gross Revenues; purchase, repairs, servicing and installation of appliances, equipment, fixtures and furnishings; reasonable and customary fees and expenses of accountants, attorneys, consultants and other professionals as incurred commencing after the completion of the Project(as evidenced by the issuance by City of a certificate of occupancy for the corresponding building developed as part of the Project) in connection with the operation of the Project; on -site service provider fees for tenant social services; payments of deductibles in connection with casualty insurance claims not normally paid from reserves; the amount of uninsured losses actually replaced, repaired or restored and not normally paid from reserves; tenant improvements that are not included in the costs of the Project, and payments made by Maker to satisfy indemnity obligations and other payments by Maker pursuant to this Agreement other than to Maker, partners or other related persons; provided, however, that payments to parties related to Maker for Operating Expenses must not exceed market rates. The Operating Expenses shall not include non -cash expenses, including without limitation, depreciation. Operating Expenses shall also exclude all of the following: (i) salaries of employees of Maker or Maker's general overhead expenses, or expenses, costs and fees paid to an affiliate, to the extent any of the foregoing exceed the expenses, costs or fees that would be payable in a bona fide arms' length transaction between unrelated parties in the San Bernardino County area for the same work or services; (ii) any amounts paid directly by a tenant of the Project to a third party in connection with expenses which, if incurred by Maker, would be Operating Expenses; (iii) optional or elective payments with respect any other loan (unless made with the consent of the City Manager in his/her reasonable discretion); (iv) any payments with respect to any Project - related loan or financing other than a single secured loan used to pay for the costs of the Project (unless made with the consent of the City Manager in his/her reasonable discretion); (v) expenses, expenditures, and charges of any nature whatsoever arising or incurred by Maker prior to 10070-0142\2740954v5.doe -4-
-206-

completion of the Project with respect to the development, maintenance and upkeep of the Development, or any portion thereof, including, without limitation, all costs and capitalized expenses incurred by Maker in connection with the acquisition of the Site (e.g. not leasing to low income tenants), all pre -construction activities conducted by Maker in connection with the Project, including, without limitation, the preparation of all plans and the performance of any tests, studies, investigations or other work, and the construction of the Project and any on site or off site work in connection therewith; (vi) depreciation, amortization, and accrued principal and interest expense on deferred payment debt; and (vii) any Partnership Fees to the extent they are not paid as capitalized expenses. The Operating Expenses shall be reported in the Annual Financial Statement and Residual Receipts Report and shall be broken out in line item detail. "Operating Reserve" shall mean, upon completion of the Project, such amount as maybe required by another secured lender providing a loan for construction of the Project to be set aside by Maker for the creation of an operating expense reserve, if any. If so required, such funds shall be deposited into a separate Operating Expense Reserve account, and reasonable evidence of the lender's requirement (including copies of the applicable loan documents) shall promptly be provided to City. Such fiinds shall be used only for Operating Expenses (including debt service) when other Project revenues are insufficient to pay them. "Operating Year" means the period commencing as of the date Maker acquires the property for the Project, and ending as of December 31 of that calendar year, then each succeeding calendar year thereafter; provided that the final Operating Year may be a portion of a calendar year. "Partnership Fees" means fees payable to Maker's General Partners and/or Limited Partners. For each Operating Year until the seventeenth (17th) anniversary of the Recording of the City Grant Deed, the total Partnership Fees shall not exceed Twenty Thousand Dollars ($20,000), adjusted for inflation at two and one-half percent (2.5%) per Operating Year measured from the Recording of the City Grant Deed. For each Operating Year after the seventeenth (17th) anniversary of the Recording of the City Grant Deed, the total Partnership Fees shall not exceed Fifteen Thousand Dollars ($15,000), adjusted for inflation at two and one-half percent (2.5%) per Operating Year measured from the recording of the City Grant Deed.
"Project" means the residential affordable senior rental project described in the Density Bonus Agreement between Maker and City (recorded against the property described in the Deed of Trust). "Refinancing" means any loan secured by the Project that Maker obtains to pay off all or a portion of an existing loan secured by the Project.
"Refinancing Net Proceeds" means the proceeds of any approved refinancing of any other loan secured by the Project, net of: (i) the outstanding principal balance and accrued interest under the existing financing which is satisfied out of such proceeds; (ii) reasonable and customary costs and expenses incurred in connection with the refinancing; (iii) the portion of the refinancing required to be used for costs of improvements to the Site which constitute the Project, including hard and soft costs, to the extent approved in writing by the City Manager prior to the closing of the refinancing.
10070-0142\2740954v5.doc -5-
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"Residual Receipts" for a particular Operating Year means Gross Revenues for the corresponding Operating Year less (i) Debt Service payments made during such Operating Year on the single loan secured by the Project and used to finance the construction of the Project (if any loan is made), in amounts not in excess of the amounts due and payable during such Operating Year (and not including prepayments); less (ii) Debt Service payments made during such Operating Year in amounts not in excess of the amounts due and payable during such Operating Year (and not including prepayments) on bona fide construction and/or permanent loans that are reasonable and necessary for construction or pennanent financing for the Project, and which have commercially reasonable terms, provided the loan documents shall have been provided to the City in advance of the loan being funded and the City Manager shall have approved the amount and terms; less (iii) Operating Expenses, less (iv) to the extent funded, payments made for Capital Replacement Reserve as made during the corresponding Operating Year; less (v) Partnership Fees due and payable during such Operating Year. All calculations of Residual Receipts shall be made annually, on or before May 15 for the preceding Operating Year, on a cash (and not accrual) basis and the components thereof shall be subject to verification and approval, on an annual basis, based upon conformity with the terms of this Agreement and the City Loan Promissory Note, by City. "Unit" shall mean any of the apartment units in the Project.

Payments; Reporting.
(a) Maker shall make payments of FIFTEEN percent (15%) of Residual Receipts on June 15th after the completion of construction of the Project, and each on anniversary thereafter until all outstanding principal and accrued interest on this Promissory Note shall have been paid in full. The outstanding principal and accrued interest shall be paid by Maker to Payee as of the earliest of. (i) a conveyance of the Project or the land securing this Promissory Note prior to completion of the Project; (ii) a failure to complete the Project by the deadline in the recorded Density Bonus Agreement between Maker and Payee, or other uncured default under the Density Bonus Agreement or the deed of trust securing this Promissory Note; or (iii) the date that is fifty- five years after completion of the Project. Payments shall be applied first to accrue interest, and then to principal.
(b) All Refinancing Net Proceeds shall be paid to City upon receipt by Developer for application to accrued interest and then outstanding principal. (c) On or before June 15 of each calendar year, commencing with the calendar year in which the Certificate of Completion is issued for the Project if the Certificate of Completion is issued prior to March 1 of such year, Developer shall annually provide the city with a "Residual Receipts report" in form and substance reasonably acceptable to the City that includes annual financial statements with respect to the Project that have been reviewed by an independent certified public accountant, together with an express written opinion of such independent certified public accountant that such financial statements present the financial position, results of operations and cash flows of the Project fairly and in accordance with generally accepted accounting principles ("Annual Financial Report"). In the event the Residual Receipts reported or paid deviate by three percent (3%) or more from that amount determined to be owing upon review of Maker's submittal, Maker shall reimburse City for its cost to review (which may 10070-0142\2740954v5.doc -6-

require engagement of auditors, and the City shall have the right to audit Maker's books and records for the Project) and collect the amounts owing.

2. Secured by Deed of Trust. Repayment of this Promissory Note is secured by a deed of trust (the "Deed of Trust") of this date executed by Maker for the benefit of Payee encumbering the property described in the Deed of Trust (the "Property" or "Site").

4. Prepayment. Maker shall have the right to prepay amounts owing under this Promissory Note at any time.

5. Due on Sale. In the event of any Transfer (as defined below) of the Property, or any portion thereof or interest therein prior to the completion of the Project, Payee shall have the absolute right at its option, without prior demand or notice, to declare all sums secured hereby immediately due and payable. As used herein, the term "Transfer" means and includes the direct or indirect sale, transfer, conveyance, assignment, or other alienation of the Property, or any portion thereof or interest therein, whether voluntary, involuntary, by operation of law or otherwise, or the lease of all or substantially all of the Property or of all or substantially all of the improvements located thereon, or a change in control of the Developer. "Transfer" shall not include the leasing of individual Units on the Property. Failure of Beneficiary to exercise the option to declare all sums secured hereby immediately due and payable upon a Transfer will not constitute waiver of the right to exercise this option in the event of any subsequent Transfer.

6. Miscellaneous.
(a) Governing Law. This Promissory Note shall be governed by the laws of the State of California.
(b) Attorneys' Fees.
(i) Maker shall reimburse Payee for all reasonable attorneys' fees, costs and expenses, incurred by Payee in connection with the enforcement of Payee's rights under this Promissory Note, including, without limitation, reasonable attorneys' fees, costs and expenses for trial, appellate proceedings, out -of -court negotiations, workouts and settlements or for enforcement of rights under any state or federal statute, including, without limitation, reasonable attorneys' fees, costs and expenses incurred to protect Payee's security and attorneys' fees, costs and expenses incurred in bankruptcy and insolvency proceedings such as (but not limited to) seeking relief from stay in a bankruptcy proceeding. The term "expenses" means any expenses incurred by Payee in connection with any of the out -of -court, or state, federal or bankruptcy proceedings referred to above, including, without limitation, the fees and expenses of any appraisers, consultants and expert witnesses retained or consulted by Payee in connection with any such proceeding.
(ii) Payee shall also be entitled to its attorneys' fees, costs and expenses incurred in any post judgment proceedings to collect and enforce the judgment. (c) Time of the Essence. Time is of the essence with respect to every provision hereof. 10070-0142\2740954v5.doc -7-
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(d) Waivers by Maker. Except as otherwise provided in any agreement executed in connection with this Promissory Note, Maker waives: presentment; demand; notice of dishonor; notice of default or delinquency; notice of acceleration; notice of protest and nonpayment; notice of costs, expenses or losses and interest thereon; and diligence in taking any action to collect any sums arising under this Promissory Note or in any proceeding against any of the rights or interests in or to properties securing payment of this Promissory Note. (e) No Waivers by City. No previous waiver and no failure or delay by Maker in acting with respect to the terms of this Promissory Note or the Deed of Trust securing it shall constitute a waiver of any breach, default, or failure of condition under this Promissory Note, such Deed of Trust or the obligations secured thereby. A waiver of any term of this Promissory Note, said Deed of Trust or of any of the obligations secured thereby must be made in writing and shall be limited to the express written terms of such waiver.

APPROVED AS TO FORM:

Richards, Watson & Gershon
M.

David Snow, City Attorney
MAKER/DEVELOPER:

EAGLE NEST 6 L.P.,
a California limited partnership
By: AHA INLAND MGP, LLC,
a California limited liability company, General Partner By: Affordable Housing Access, Inc.,
a California nonprofit public benefit corporation,
its Sole Member and Manager
William W. Hirsch
Chief Executive Officer
By: EAGLE YUCAIPA 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
10070-0142\2740954v5.doc -8-
-21 0-

By: Eagle Real Estate Investment Manager LLC,
a Delaware limited liability company,
its Manager
an
Randall J. Friend
Manager
By: EAGLE YUCAIPA 55 LLC,
a Delaware limited liability company,
its Limited 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: EAGLE YUCAIPA 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
Randall J. Friend
Manager
10070-0142\2740954v5.doc -9-
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RECORDING REQUESTED BY, AND
WHEN RECORDED, MAIL TO:

City of Yucaipa
34272 Yucaipa Blvd.

Yucaipa, CA 92399
Attn: Restaurant Infrastructure Improvement
Program Administrator
APN: 0319-233-91
(Space Above This Line For Recorder's Use)
This Document is recorded for the benefit of the City of Yucaipa and is exempt from California documentary transfer tax pursuant to Section 11928 of the California Revenue and Taxation Code and from recording fees pursuant to Sections 6103, 27383 of the California Government Code,

DEED OF TRUST AND ASSIGNMENT OF RENTS
This Deed of Trust and Assignment of Rents is dated , 2022, and is executed by EAGLE NEST 6 L.P., a California limited partnership, herein called the Trustor, whose address is c/o Eagle Real Estate Group, LLC, 1500 Quail Street, Suite 120, Newport Beach, California 92660, Attn: Randall J. Friend, in favor of the City of Yucaipa, as Trustee, for the benefit of the CITY OF YUCAIPA, herein called the Beneficiary.

Witnesseth: that Trustor IRREVOCABLY GRANTS, TRANSFERS AND ASSIGNS TO TRUSTEE IN TRUST, WITH POWER OF SALE, that property in San Bernardino County, California, described in Exhibit "A" attached hereto including all improvements and fixtures now or hereafter located thereon (collectively, the "Property").

TOGETHER WITH the rents, issues and profits thereof, SUBJECT, HOWEVER, to the right, power and authority hereinafter given to and conferred upon the Beneficiary to collect and supply such rents, issues and profits.

For the Purpose of Securing:

Payment of principal and interest, if and when due, under that certain Promissory Note dated substantially concurrently herewith executed by Trustor in favor of Beneficiary (the "Note"). 10070-0142\2740954v5.doc -10-
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To Protect the Security of This Deed of Trust, the Trustor Agrees:
(1) To keep said Property in good condition and repair; not to remove or demolish any building thereon, to complete or restore promptly and in good workmanlike manner any building which may be constructed, damaged or destroyed thereon and to pay when due all claims for labor performed and materials furnished thereof, to comply with all laws affecting said Property, or requiring any alterations or improvements to be made thereon; not to commit or permit waste thereof, not to commit, suffer or permit any act upon said Property in violation of law; and to do all other acts which from the character or use of said Property may be reasonably necessary, the specific enumerations herein not excluding the general. (2) To appear in and defend any action or proceeding purporting to affect the security hereof or the rights or powers of the Beneficiary or the Trustee; and to pay all costs and expenses, including cost of evidence of title and attorneys' fees in a reasonable sum, in any such action or proceeding in which the Beneficiary or the Trustee may appear, and in any suit brought by the Beneficiary to foreclose this Deed of Trust.
(3) To pay: at least ten (10) days before delinquency all taxes and assessments affecting said Property, including assessments on appurtenant water stock; when due, all encumbrances, charges and liens, with interest, on said Property or any part thereof, which appear to be prior or superior hereto; all costs, fees and expenses of this Trust.

Should the Trustor fail to make any payment or to do any act as herein provided, then the Beneficiary or the Trustee, but without obligation so to do and without notice to or demand upon the Trustor and without releasing the Trustor from any obligation hereof, may: (a) make or do the same in such manner and to such extent as either may deem necessary to protect the security hereof, the Beneficiary or the Trustee being authorized to enter upon said Property for such purposes; (b) appear in and defend any action or proceeding purporting to affect the security hereof or the rights or powers of the Beneficiary or the Trustee; (c) pay, purchase, contest or compromise any encumbrance, charge or lien which in the judgment of either appears to be prior or superior hereto; and (d) in exercising any such powers, pay necessary expenses, employ counsel and pay his reasonable fees.
(4) To pay immediately and without demand all sums so expended by the Beneficiary or the Trustee, with interest from date of expenditure at the amount allowed by law in effect at the date hereof, and to pay for any statement provided for by law in effect at the date hereof regarding the obligation secured hereby any amount demanded by the Beneficiary not to exceed the maximum allowed by law at the time when said statement is demanded. (5) That any award of damages in connection with any condemnation for public use of or injury to said Property or any part thereof is hereby assigned and shall be paid to the Beneficiary (and to any superior trust deed holder, as their interests may appear) who may apply or release such moneys received by him in the same manner and with the same effect as above provided for disposition of proceeds of fire or other insurance.
10070-0142\2740954v5.doc -1 1-
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(6) That by accepting payment of any sum secured hereby after its due date, the Beneficiary does not waive its right either to require prompt payment when due of all other sums so secured or to declare default for failure so to pay. (7) That at any time or from time to time, without liability therefore and without notice, upon written request of the Beneficiary and presentation of this Deed of Trust and the Note for endorsement, and without affecting the personal liability of any person for payment of the indebtedness secured hereby, the Trustee may reconvey any part of said Property or join in any extension agreement or any agreement subordinating the lien or charge hereof. (8) That upon written request of the Beneficiary stating that all sums secured hereby have been paid, and upon surrender of this Deed of Trust and the Note to Trustee for cancellation and retention and upon payment of its fees, the Trustee shall reconvey, without warranty, the Property then held hereunder. The recitals in such reconveyance of any matters or facts shall be conclusive proof of the truthfulness thereof. The grantee in such reconveyance may be described as "the person or persons legally entitled thereto."
(9) That as additional security, subject to the rights of superior trust deed holders, as their interests may appear, the Trustor hereby gives to and confers upon the Beneficiary the right, power and authority, during the continuance of these trusts, to collect the rents, issues and profits of said Property, reserving unto the Trustor the right, prior to any default by the Trustor in payment of any indebtedness secured hereby or in performance of any agreement hereunder, to collect and retain such rents, issues and profits as they become due and payable. Upon any such default, the Beneficiary may at any time without notice, either in person, by agent, or by a receiver to be appointed by a court, and without regard to the adequacy of any security for the indebtedness hereby secured, enter upon and take possession of said Property or any part thereof, in its own name sue for or otherwise collect such rents, issues and profits, including those past due and unpaid, and apply the same, less costs and expenses of operation and collection, including reasonable attorneys' fees, upon any indebtedness secured hereby, and in such order as the Beneficiary may determine. The entering upon and taking possession of said Property, the collection of such rents, issues and profits and the application thereof as aforesaid, shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice.
(10) That upon default by the Trustor in payment of any indebtedness secured hereby, or in performance by the Trustor of any agreement hereunder, or default by the Trustor under the Note that is not cured within the cure period, if any, expressly described therein and applicable to the default, the Beneficiary may declare all sums secured hereby immediately due and payable by delivery to the Trustee of written declaration of default and demand for sale and of written notice of default and election to cause to be sold said Property, which notice the Trustee shall cause to be filed for record.

After the lapse of such time as may then be required by law following the recordation of said notice of default, and notice of sale having been given as then required by law, the Trustee, without demand on the Trustor, shall sell said Property at the time and place fixed by it in said notice of sale, either as a whole or in separate parcels, and in such order as it may determine, at public auction to the highest bidder for cash in lawful money of the United States, payable at time 10070-0142\2740954v5.doe -12-
-214-

of sale. The Trustee may postpone sale of all or any portion of said Property by public announcement at such time and place of sale, and from time to time thereafter may postpone such sale by public announcement at the time fixed by the preceding postponement. The Trustee shall deliver to such highest bidder its deed conveying the Property so sold, but without any covenant or warranty, express or implied. The recitals in such deed of any matters or facts shall be conclusive proof of the truthfulness thereof. Any person, including the Trustor, the Trustee, or the Beneficiary may purchase the Property at such sale.

After deducting all costs, fees and expenses of the Trustee and of this Deed of Trust, including cost of evidence of title in connection with sale, the Trustee shall apply the proceeds of sale to payment of. all sums expended under the terms hereof, not then repaid, with accrued interest at the amount allowed by law in effect at the date hereof; all other sums then secured hereby; and the remainder, if any, to the person or persons legally entitled thereto. (11) The Beneficiary, or any successor in ownership of any indebtedness secured hereby, may from time to time, by instrument in writing, substitute a successor or successors to any Trustee named herein or acting hereunder, which instrument, executed by the Beneficiary and duly acknowledged and recorded in the office of the recorder of the county or counties where said Property is situated, shall be conclusive proof of proper substitution of such successor Trustee or Trustees, who shall, without conveyance from the Trustee predecessor, succeed to all its title estate, rights, powers and duties. Said instrument must contain the name of the original Trustor, Trustee and Beneficiary hereunder, the book and page where this Deed of Trust is recorded and the name and address of the new Trustee.
(12) That this Deed of Trust applies to, inures to the benefit of, and binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors and assigns. The term Beneficiary shall include the owner and holder, including pledges, of the Note secured hereby, whether or not named as the Beneficiary herein. In this Deed of Trust, whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the singular number includes the plural.
(13) That the Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law. (14) Notwithstanding anything provided herein to the contrary, the Beneficiary agrees to look solely to the Trustor's interest in the Property encumbered hereby and improvements thereon (or the proceeds thereof) for the satisfaction of any remedy of the Beneficiary, and for the collection of a judgment (or other judicial process) requiring the payment of money by the Trustor. 10070-0142\2740954v5.doc -13-
-215-

The undersigned Trustor requests that a copy of any Notice of Default and of any Notice of Sale hereunder be mailed to him at his address hereinbefore set forth.

APPROVED AS TO FORM:

Richards, Watson & Gershon
David Snow, City Attorney
EAGLE NEST 6 L.P.,
a California limited partnership
By: AHA INLAND MGP, LLC,
a California limited liability company, General Partner By: Affordable Housing Access, Inc.,
a California nonprofit public benefit corporation,
its Sole Member and Manager
William W. Hirsch
Chief Executive Officer
By: EAGLE YUCAIPA 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
IN
Randall J. Friend
Manager
L 0070-0 L 42\2740954v5.doc -14-
-216-

By: EAGLE YUCAIPA 55 LLC,
a Delaware limited liability company,
its Limited 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
LO
By: EAGLE YUCAIPA 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
Randall J. Friend
Manager
10070-0142\2740954v5.doc -15-
-217-

CALIFORNIA ALL-PURPOSE ACKNOWLEDGEMENT
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 SAN BERNARDINO
On before me, 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, and that by his/her/their signature(s) on the instrument the person(s), or the entity(ies) upon behalf of which the person(s) acted, executed the instrument.

I certify tinder 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 of Notary Public
Place Notary Seal Above
10070-0142\2740954v5.doc -16-
-218-

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
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

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 of Notary Public
Place Notary Seal Above
10070-0142\2740954v5.doc -1 %-
-219-

STATE OF CALIFORNIA

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 of Notary Public
Place Notary Seal Above
10070-0142\2740954v5.doc -18-
-220-

EXHIBIT "A"

LEGAL DESCRIPTION
That real property located in the City of Yucaipa, County of San Bernardino, State of California, and described as follows:

THOSE PORTIONS OF PARCEL 2 OF PARCEL MAP NO. 2070 AS PER MAP RECORDED IN BOOK 21, PAGE 56, OF PARCEL MAPS, RECORDS OF SAN BERNARDINO COUNTY,

STATE OF CALIFORNIA, SAID PORTIONS MORE PARTICULARLY DESCRIBED AS FOLLOWS: COMMENCING AT THE CENTERLINE INTERSECTION OF COUNTY LINE ROAD WITH 5TH STREET (FORMERLY AVENUE A) PER SAID PLAT; THENCE ALONG THE CENTERLINE OF SAID 5TH STREET NORTH 0 DEG 00' 18" WEST 104.34 FEET; THENCE LEAVING THE CENTERLINE OF SAID 5TH STREET NORTH 89 DEG 59'42" EAST 44.00 FEET TO A POINT OF INTERSECTION WITH THE EASTERLY RIGHT-OF- WAY OF SAID 5TH STREET, SAID EASTERLY RIGHT-OF-WAY BEING PARALLEL WITH AND. DISTANT 44.00 FEET EASTERLY OF THE CENTERLINE OF SAID 5TH STREET, SAID POINT OF INTERSECTION BEING THE TRUE POINT OF BEGINNING; THENCE LEAVING THE EASTERLY RIGHT-OF-WAY OF SAID 5TH STREET SOUTH 89 DEG 35' 13" EAST 215.80 FEET; THENCE SOUTH 00 DEG 00'27" WEST 124.45 FEET TO A

INTERSECTION WITH THE NORTHERLY RIGHT-OF-WAY OF SAID COUNTY LINE

ROAD, SAID NORTHERLY RIGHT-OF-WAY BEING PARALLEL WITH AND DISTANT

56.55 FEET NORTHWESTERLY ALONG SAID TANGENT CURVE THROUGH A CENTRAL ANGLE OF 13 DEG 41' 58" TO A POINT OF NON -TANGENT INTERSECTION WITH THE EASTERLY RIGHT-OF-WAY OF SAID 5TH STREET, A RADIAL LINE

APN: 0319-233-91
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EXHIBIT "B"

RIDER TO DEED OF TRUST
Exhibit "B" to Deed of Trust with Assignment of Rents dated as of , executed by Eagle Nest 6, L.P., a California limited partnership, as "Trustor", to Chicago Title a California corporation, as Trustee, for the benefit of the City of Yucaipa, a municipal corporation, as "Beneficiary" ("Deed of Trust").

1. NON -IMPAIRMENT. Except as supplemented and/or modified by this Deed of Trust, all of the terms, covenants and conditions of the Other Deeds of Trust and the other loan documents executed in connection therewith shall remain in full force and effect.

2. DUE ON SALE OR ENCUMBRANCE. In the event of any Transfer (as defined below) of the Property, or any portion thereof or interest therein, Beneficiary shall have the absolute right at its option, without prior demand or notice, to declare all sums secured hereby immediately due and payable. As used herein, the term "Transfer" means and includes the direct or indirect sale, transfer, conveyance, mortgage, further encumbrance, assignment, or other alienation of the Property, or any portion thereof or interest therein, whether voluntary, involuntary, by operation of law or otherwise, the execution of any installment land sale contract, sales agreement or similar instrument affecting all or a portion of the Property, granting of an option to purchase any portion of or interest in the Property or any interest therein, or the lease of all or substantially all of the Property or of all or substantially all of the improvements situated on the Property prior to timely completion of the project to be constructed on the Property as required by the Density Bonus Agreement with the City of Yucaipa. "Transfer" shall not include the leasing of individual dwelling units on the Property. Failure of Beneficiary to exercise the option to declare all sums secured hereby immediately due and payable upon a Transfer will not constitute waiver of the right to exercise this option in the event of any subsequent Transfer.

PRIORITY OF DEED OF TRUST. [INTENTIONALLY OMITTED]

4. NOTICE AND CURE RIGHTS BY LIMITED PARTNERS. Notwithstanding anything to the contrary contained in the Lease, City hereby agrees that any cure of any default made or tendered by Developer's limited partners shall be deemed to be a cure by Developer and shall be accepted or rejected on the same basis as if made or tendered by Developer; provided City shall have received written notice by Developer of the indentity of, and address for notices for, such limited partners.

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CERTIFICATE OF ACCEPTANCE
(for Deed of Trust)
This is to certify that the fee interest in real property conveyed under the foregoing Deed of Trust by Eagle Nest 6, L.P., a California limited partnership, as to the following property:

Real property in the City of Yucaipa, County of San Bernardino, State of California, described as follows:

For APN/Parcel ID(s): 0319-233-91
THOSE PORTIONS OF PARCEL 2 OF PARCEL MAP NO. 2070 AS PER MAP RECORDED IN BOOK 21, PAGE 56, OF PARCEL MAPS, RECORDS OF SAN BERNARDINO COUNTY,

INTERSECTION WITH THE NORTHERLY RIGHT-OF-WAY OF SAID COUNTY LINE

ROAD, SAID NORTHERLY RIGHT-OF-WAY BEING PARALLEL WITH AND DISTANT

56.55 FEET NORTHWESTERLY ALONG SAID TANGENT CURVE THROUGH A CENTRAL ANGLE OF 13 DEG 41' S8" TO A POINT OF NON -TANGENT INTERSECTION WITH THE EASTERLY RIGHT-OF-WAY OF SAID 5TH STREET, A RADIAL LINE

PASSING THROUGH SAID POINT OF NON -TANGENT INTERSECTION BEARS SOUTH -B-2-
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74 DEG 06'44" WEST; THENCE ALONG THE EASTERLY RIGHT-OF-WAY OF SAID 5TH STREET NORTH 00 DEG 00' 18" WEST 2.62 FEET TO THE TRUE POINT OF BEGINNING. is hereby accepted by the City Manager of the City of Yucaipa (the "City") on behalf of the City Council of the City pursuant to authority conferred by action of the City Council as the governing board of the City on , and the Grantee consents to recordation thereof by its duly authorized officer.

CITY OF YUCAIPA,
a municipal corporation
By:

Raymond A. Casey, City Manager
FUN
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EXHIBIT "C"

FORM OF DENSITY BONUS AGREEMENT
(Attached.)
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RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:

City of Yucaipa
34272 Yucaipa Blvd.

Yucaipa, CA 92399
Attn: City Clerk
With a copy to:

Eagle Nest 6, L.P.
c/o Eagle Real Estate Group, LLC
1500 Quail Street, Suite 120
Newport Beach, California 92660
Attn: Randall J. Friend
APN: 0319-233-91

SPACE ABOVE THIS LINE FOR

RECORDER'S USE
Exempt from Recording Fees Pursuant to Government Code Section 27383

DENSITY BONUS AGREEMENT
(SENIOR HOUSING; RENTAL PROJECT)
THIS DENSITY BONUS AGREEMENT ("Agreement") is dated as of 2022 and is entered into by and between EAGLE NEST 6 L.P., a California limited partnership ("Developer"), and the CITY OF YUCAIPA, a California municipal corporation (the "City").

RECITALS
A. California Government Code Section 65915(b)(1)(C) provides that a city shall give a density bonus as described in Government Code Section 65915(f), upon application by a developer if the developer agrees to construct a senior citizen housing development, as defined in Section 51.3 of the California Civil Code, and that all cities shall adopt an ordinance that specifies how Section 65915 will be implemented.

B. The City has implemented California Government Code Section 65915(b)(1) and (f) by enacting Yucaipa Development Code Sections 83.010705 et seq. (in Division 3, Chapter 1, Article 7 of the Development Code), which, subject to certain limitations, contemplates a density bonus to encourage development of senior housing.

C. Developer has requested City to consider the approval of a density bonus agreement which will grant such a density bonus for Developer's development of the real property in the City described on Exhibit "A" ("Site").

D. The Developer proposes to construct a senior housing residential rental project, consisting of 6 senior apartment units on the Site ("Project").

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AGREEMENT
NOW, THEREFORE, the parties hereto agree as follows:

Definitions. In this Agreement, the following terms shall have the following meaning:

1.1 "City" is the City of Yucaipa, California.

1.2 "Project" is the development described in Recital D above.

1.3 "Qualified Occupant" shall mean households: (i) consisting of at least one person who is sixty-one and a half (61.5) years of age or older, and each other resident of the applicable dwelling unit must be a qualified permanent resident as described in Section 51.3 of the Civil Code, a permitted health care resident as described in Section 51.3 of the Civil Code, or a person under fifty-five (55) years of age whose occupancy is permitted under subdivision (h) of Section 51.3(c) of the Civil Code or under subdivision (b) of Section 51.4 of the Civil Code; (ii) which, as to five of the six units, have an income less than eighty percent (80%) of Area Median Income and more than sixty percent (60%) of Area Median Income (i.e., are a "Low Income Household"), and as to the final/sixth unit, has an income less than fifty percent (50%) of Area Median Income and greater than forty percent (40%) of Area Median Income (i.e., is a "Very Low Income Household"). As used herein, "Area Median Income" shall mean area median income for San Bernardino County as published annually by the California Department of Housing and Community Development (or "HCD") for a household size appropriate to the unit.

2. Binding Effect of Agreement. The Developer hereby subjects the Site and development thereon to the covenants, reservations and restrictions as set forth in this Agreement in perpetuity. The City and the Developer hereby declare their specific intent that the covenants, reservations and restrictions as set forth herein shall be deemed covenants running with the land and shall encumber and "run with" the Site and be binding upon the Developer's successors and assigns and successor to any interest in the Project.

Each and every contract, deed or other instrument hereinafter executed, covering or conveying the development or any portion thereof shall conclusively be held to have been executed, delivered and accepted subject to the covenants, reservations and restrictions expressed in this Agreement, regardless of whether such covenants, reservations and restrictions are set forth in such contract, deed or other instrument.

3. Restrictions on Units, Qualified Occu ant. All of the units in the Project shall be rented to and occupied by households which are Qualified Occupants (the "Senior Units") and the rent charged for the units shall not exceed Affordable Rent for the Qualified Occupant. As used herein, "Affordable Rent" shall mean the rent described in California Health and Safety Code Section 50053(b) for the applicable income level of a Qualified Occupant household. (Under the income parameters in Section lc(i) above, five of the six units are to be rented to "Lower Income Households" and the final/sixth unit is to be rented to a "Very Low -Income Household".)

4. Term. The term of this Agreement shall continue until the date that is 55 years after the first rental of a unit to a Qualified Occupant.

5. No Conversion. During the term hereof, all residential units in the Project shall remain rental units. During the term hereof, no apartment unit in the Project shall be eligible for conversion from rental units to condominiums, townhomes, or any other common interest subdivision without consent of the City Council.

6. Submission of Materials and Annual Review. Prior to occupancy of a Senior Unit, Developer shall submit to City its occupant selection procedures which shall detail the methods which C-3-
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Developer shall use to advertise the availability of Senior Units in the Project and screening mechanisms which Developer intends to use to limit the occupancy of the Senior Units to Qualified Occupants.

Notwithstanding anything to the contrary set forth below in this Section 3, Developer shall comply with Section 83.010725(h) of the Yucaipa Municipal Code (requiring that Developer retain annual sworn and notarized inome statements and current tax returns for each household) and Developer shall send copies thereof to City from time to time upon request by the City Manager.

Income and Age Verification and Certification. Developer will obtain and maintain on file an Income and Age Verification from each tenant (for every Restricted Unit), dated immediately prior to the initial occupancy of such tenant.

On following the completion of the Project, and each anniversary thereof, Developer shall file with City a Certificate, containing all information required pursuant to Yucaipa Municipal Code

83.010740(e)(3) and (g) (name, address/unit, income, bedroom size and rent for each household/unit), and if the City presecribes the form thereof, then it shall be provided on such form prescribed by City. Each Certificate shall cover the immediately preceding Year.

Developer shall maintain on file throughout the term of this Agreement each tenant's executed lease and Income and Age Verification and rental records for the Project. Developer shall maintain complete and accurate records pertaining to the Restricted Units, and will permit any duly authorized representative of City to inspect the books and records of Developer pertaining to the leasing of Restricted Units. Developer shall prepare and submit to City annually commencing on and continuing throughout the term of this Agreement, a Certificate of Continuing Compliance. Such documentation shall state for each unit in the Project the unit size, the rental amount, the number of occupants, and the income of the occupants, the age of the occupants and any other information which may be used to determined compliance with the terms of this Agreement.

City may request (and Developer shall provide) additional documentation to assist evaluation of Developer's compliance with this Agreement. Further, City shall have the right, but not the obligation to contact occupants and otherwise monitor compliance, and City's election to monitor some, but not all, of the Restricted Units shall not constitute a waiver of City's right to monitor and enforce compliance with respect to all Restricted Units thereafter.

Verification oflncome of New and Continuing Tenants. Gross income calculations for prospective (and continuing) tenants shall be determined in accordance with 25 Cal. Code Regs. Section 6914.

Developer shall verify the income and information provided in the income certification of the proposed tenant as set forth below.

Developer shall verify the income of each proposed tenant by at least one of the following methods as appropriate to the proposed tenant:

G) obtain two (2) paycheck stubs from the person's two (2) most recent pay periods; (ii) obtain an income verification certification from the employer of the person; (iii) obtain an income verification certification from the Social Security Administration and/or the California Department of Social Services if the person receives assistance from such agencies; C-4-
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(iv) obtain an alternate form of income verification reasonably requested by City, if none of the above forms of verification is available to Developer and Developer provides evidence thereof to City.

On or before of each year following the first leasing of any Senior Unit, the Developer, or its representative, shall file a certificate of continuing program compliance with the City.

Each such report shall contain such information as City may require including, but not limited to, the following:
a. The number of persons per unit;
b. Qualified Occupant(s) names and address (unit);
C. Initial occupancy date;
Copies of the leases (rent may not be redacted).

City shall be allowed to conduct physical inspections of the Project as it shall deem necessary, provided that said inspections do not unreasonably interfere with the normal operations of the Project and reasonable notice is provided. City shall repair any damage and shall defend, indemnify and hold Developer harmless from and against any claims, liabilities, damages, costs, expenses incurred by Developer relating in any way to City's inspections and investigations.

7. Selection of Qualified Occupants. Developer shall determine the eligibility for occupancy of Senior Units under the terms of this Agreement. Verification of eligibility shall be based on the following information and any other information reasonably requested by City: Age documentation of 61.5 years or older, and the income information described in Section 7 above.

8. Development Incentive(s). Pursuant to Government Code Section 65915(b)(1) and (f) and Yucaipa Municipal Code Section 83.010715(b)(4), the City grants Developer the following incentives for development of the Project. A 100% Density Bonus to allow a Project that provides 17.4 du/ac subject to the following:
a. Reduce the minimum two (2)-bedroom dwelling unit size per Yucaipa Development Code Section 88.0210(a) for two (2)-bedroom multi -family units from 900 square feet to 876 square feet
b. Reduce the minimum private open space requirement per Yucaipa Development Code Section 88.0210(e) for multi -family ground floor units from 150 square feet to 96 square feet, and 100 square feet to 98 square feet for second floor units with balconies C. Reduce the minimum front yard setback per Yucaipa Development Code Section

84.0330(c) for two-story multi -family units from 30 feet to 22.2 feet

9. Project Design Amenities for Senior Citizens. The Project open space, buildings and individual units shall be designed with physical amenities catering to the needs and desires of the senior citizen residents. The following physical amenities shall be included in the Project a. Senior Unit sizes shall be 876 square feet (all units are 2-bedroom), and Project shall be of the same quality, with the same amenities (including pool, jacuzzi, dog park and planting gardens) as the Villas project across the street;
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C. All common access areas in the Project such as entryways, walkways, and hallways will be wide enough to accommodate wheelchairs; d. The Project will meet all applicable current requirements for access and design imposed by law as administered by the City building and safety department, including, but not limited to, the Fair Housing Act (42 U.S.C. Sec. 3601 et seq.), the Americans with Disabilities Act (42 U.S.C. Sec. 12101 et seq.), and the regulations promulgated at Title 24 of the California Code of Regulations that relate to access for persons with disabilities or handicaps;
e. The Project shall be completed and available for occupancy (i.e., a certificate of occupancy shall have been issued) by (subject to delays beyond the control of Developer). However, the City Manager of City may reasonably extend such deadline, provided the extension(s) are in writing.

10. Indemnification. Developer shall defend, indemnify and hold City and its elected officials, officers, agents and employees harmless from claims, liabilities, losses, damages and costs and expenses arising from or relating to: (i) personal injuries, including death, and property damage which may arise from the activities of Developer or those of its contractor, subcontractor, agent, employee or other person acting on its behalf which relate to the Project; and (ii) any fair housing claims. Notwithstanding the foregoing, this provision shall not apply to any such claims which arise out of, or by reason of, the sole negligence or sole willful misconduct of the City.

11. Event of Default. Developer is in default under this Agreement upon the happening of one or more of the following events or conditions:
a. If a warranty, representation or statement made or furnished by Developer to City and is inaccurate in any material respect when it was made; b. A breach by Developer of any of the provisions or terms of this Agreement, after notice and opportunity to cure as provided in Section 12 below.

12. Enforcement. In the event of a default under the provisions of this Agreement by Developer is not corrected within thirty (30) days after such notice is given, then City may, without further notice, declare a default under this Agreement and City may then enforce as any normal violation of the standards and provisions of the Yucaipa Development Code, or Yucaipa Municipal Code, applicable to this Agreement. However, notwithstanding the foregoing, City may at any time apply to any court, state or federal, for injunctive relief against any violation by Developer of any provision of this Agreement. All other remedies at law or in equity which are not otherwise provided for in this Agreement are available to the parties to pursue in the event that there is a breach of this Agreement.

13. Developer Representation Re: Priority. Developer represents and warrants that this Agreement, when recorded, is senior and prior to all deeds of trust and other liens, except for liens for property taxes and assessments not yet due. City shall not be obligated to subordinate this Agreement to any deeds of trust or other liens.

14. No Waiver of Remedies. City does not waive any claim of defect in performance by Developer if upon periodic review City does not enforce or terminate this Agreement. No waiver by City of any breach or default under this Agreement shall be deemed to be a waiver of any other subsequent breach thereof or default hereunder.

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15. Rights of Lenders. Should Developer place or cause to be placed any encumbrance or lien on the Project, or any part thereof, subordinate to this Agreement, the beneficiary ("Lender") of said encumbrance or lien, including, but not limited to, deeds of trust, shall have the right at any time during the term of this Agreement and the existence of said encumbrance or lien to:
a. Do any act or thing required of Developer under this Agreement, and any such act or thing done or performed by Lender shall be as effective as if done by Developer itself; b. Realize on the security afforded by the encumbrance or lien by exercising foreclosure proceedings or power of sale or other remedy afforded in law or in equity or by the security document evidencing the encumbrance or lien;
C. Transfer, convey or assign the title of Developer to the Project to any purchaser at any foreclosure sale, whether the foreclosure sale be conducted pursuant to court order or pursuant to a power of sale contained in a trust deed; and
d. Acquire and succeed to the interest of Developer by virtue of any foreclosure sale, whether the foreclosure sale is conducted pursuant to a court order or pursuant to a power of sale contained in a trust deed.

None of b., c. or d. shall, however, affect the continuing validity of this Agreement.

16. Notice to Lender. If Developer shall have provided City in writing with the name of the Lender and a copy of its recorded deed of trust showing its address for notices, then City shall give written notice of any default or breach under this Agreement by Developer to such Lender and if the default can be cured by the payment of money, City shall give Lender the opportunity after service of the notice to cure the breach or default within sixty (60) days after delivery of said notice.

17. Notices. Any notice required to be given by the terms of this Agreement by either party to the other shall be provided by certified mail, return receipt requested, at the address of the respective parties as specified below or at any other such address as may be later specified by the parties hereto in a notice given pursuant to this Section.

Developer: Eagle Nest 6, L.P.
c/o Eagle Real Estate Group, LLC
1500 Quail Street, Suite 120
Newport Beach, California 92660
Attn: Randall J. Friend
City: City of Yucaipa
34272 Yucaipa Blvd.

Yucaipa, CA 92399
Attn: Benjamin Matlock

18. Attorneys' Fees. In any proceedings arising from the enforcement of this Agreement or because of an alleged breach or default hereunder, the prevailing party shall be entitled to recover its costs and its reasonable attorneys' fees incurred during the proceeding as may be fixed within the discretion of the court.

19. Applicable Law. This Agreement shall be construed in accordance with and governed by the laws of the State of California.

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20. Partial Invalidity. If any provisions of this Agreement shall be deemed to be invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions hereof shall not in any way be affected or impaired thereby.

21. Recordation. This Agreement shall be recorded in the Official Records of the County Recorder of the County of San Bernardino prior to the issuance of any building permit(s) for the Project.

22. Time of Essence. Time is of the essence of every provision hereof in which time is a factor.

IN WITNESS WHEREOF, this Agreement has been executed by the parties and shall be effective on the Effective Date set forth herein.

DEVELOPER:

EAGLE NEST 6, LP,
a California limited partnership
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
William W. Hirsch
Chief Executive Officer
By: EAGLE YUCAIPA 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
go
Randall J. Friend
Manager
By: EAGLE YUCAIPA 55 LLC, a Delaware limited liability company, its Limited 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
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CITY:

CITY OF YUCAIPA,
a municipal corporation
David Avila, Mayor
ATTEST:

Jennifer Crawford, City Clerk
APPROVED AS TO FORM:

NO
By:

Print Name:

Title:

David M. Snow, City Attorney
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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 )
On , before me,
(insert name and title of the officer)
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
(Seal)
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EXHIBIT "D"

FORM OF GRANT DEED
(Attached.)
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RECORDING REQUESTED BY,

AND WHEN RECORDED RETURN TO
(AND MAIL TAX STATEMENTS TO):

Eagle Nest 6, L.P.
c/o Eagle Real Estate Group, LLC
1500 Quail Street, Suite 120
Newport Beach, California 92660
Attn: Randall J. Friend
APN: 0319-233-91
[SPACE ABOVE FOR RECORDER'S USE ONLY]
THE UNDERSIGNED GRANTOR DECLARES AS FOLLOWS:

The undersigned declares that this Grant Deed is exempt from Recording Fees pursuant to California Government Code Section 27383.

Documentary Transfer Tax is $
FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged the CITY OF YUCAIPA ("Grantor"), hereby grants to EAGLE NEST 6, L.P., a California limited partnership, the land located in the County of San Bernardino, State of California, more particularly described on Exhibit "A" attached hereto.

The land shall not be further conveyed by the grantee prior to completion of the project described in the Density Bonus Agreement recorded after this Grant Deed.

IN WITNESS WHEREOF, Grantor has executed this Grant Deed as of the date set forth below.

Dated: , 2022

CITY OF YUCAIPA
I:

Ray Casey, City Manager
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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 San Bernardino
On , before me,
(insert name and title of the officer)
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.
(Seal)
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EXHIBIT "E"

COVENANTS AND RESTRICTIONS FOR REAL PROPERTY
(per Government Code Section 54233)
"Attached"
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RECORDING REQUESTED BY, AND
WHEN RECORDED MAIL TO:

City of Yucaipa
34272 Yucaipa Boulevard
Yucaipa, CA California 92399
Attention: City Clerk
APN: 0319-233-91
Exempt from recording fees pursuant to Government Code section 6103. (Space Above for Recorder's Use)

COVENANTS AND RESTRICTIONS FOR REAL PROPERTY
(per Government Code Section 54233)

RECITALS
WHEREAS, Owner is the owner of certain real property located in the City of Yucaipa, County of San Bernardino, California as is described in the legal description in the attached and incorporated Exhibit "A" ("the property");
WHEREAS, Assembly Bill 1486 amended the Surplus Land Act (Government Code Section 54220 et. Seq.) and created new obligations before a local agency may dispose of surplus land;
WHEREAS, the Surplus Land Act designates the California State Department of Housing and Community Development ("HCD") with oversight with respect to a local agency's compliance with the Surplus Land Act; and
WHEREAS, HCD requires that certain affordability covenants and restrictions be recorded against surplus land as set forth in Government Code Section 54233 prior to its disposition.

NOW, THEREFORE, in consideration of the foregoing, the Owner declares as follows:

A. If ten (10) or more residential units are developed on the property described on Exhibit "A" attached hereto then not less than 15 percent of the total number of residential units developed on the property shall be sold or rented at an affordable housing cost, as defined in Section 50052.5 of the California Health and Safety Code, or affordable rent, as defined in Section 50053 of the California Health and Safety Code, to lower -income households, as defined in Section 50079.5 of the California Health and Safety Code. Rental units shall remain affordable to and occupied by lower -income households for a period of 55 years for rental housing and 45 years for ownership housing. The initial occupants of all ownership units shall be lower- -E-2-
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income households, and the units shall be subject to an equity sharing agreement consistent with the provisions of paragraph (2) of subdivision (c) of 65915 of California Government Code.

B. These requirements shall be covenants and restrictions running with the land and shall be enforceable against any owner who violates a covenant or restriction and each successor -in -interest who continues the violation by any of the entities described in subdivisions (a) to (f), inclusive, of Section 54222.5 of the California Government Code.

C. The restrictions and Covenants set forth herein are intended not to merge into the Owner's fee simple title to the Property, but become effective when the Property is conveyed by the current Owner (i.e. the City of Yucaipa).

ATTEST:

Jennifer Crawford, City Clerk
APPROVED AS TO FORM:

David Snow, City Attorney
OWNER: CITY OF YUCAIPA
Raymond A. Casey, City Manager
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Yucaipa City CouncilNovember 14, 2022

Yucaipa City Council
November 14, 2022