Exhibit 10.1

                                                    

PURCHASE AND SALE AGREEMENT

BETWEEN

ESTANCIA TULSA, LLC,
a Delaware limited liability company

AS SELLER,

AND

STEADFAST ASSET HOLDINGS, INC.
a California corporation

AS PURCHASER

As of February 15, 2012

                                                    

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Table of Contents
Page
ARTICLE 1 PURCHASE AND SALE
1

1.1
Agreement of Purchase and Sale     2    

1.2
Property Defined    2

1.3
Permitted Exceptions    2

1.4
Purchase Price    2

1.5
Payment of Purchase Price    3

1.6
Earnest Money    4

ARTICLE 2 TITLE AND SURVEY
4

2.1
Title Examination; Commitment for Title Insurance    4

2.2
Survey    4

2.3
Title Objections; Cure of Title Objections    5

2.4
Conveyance of Title    6

2.5
Pre-Closing “Gap” Title/Survey Defects    7

2.6
Seller's Covenant Not to Encumber    7

ARTICLE 3 INSPECTION
7

3.1
Right of Inspection    7

3.2
Right of Termination    8

3.3
Confidentiality    9

ARTICLE 4 CLOSING
10

4.1
Time and Place    10

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4.2
Seller's Obligations at Closing    10

4.3
Purchaser's Obligations at Closing    12

4.4
Credits and Prorations    13

4.5
Closing Costs    16

4.6
Conditions Precedent to Obligation of Purchaser    16

4.7
Conditions Precedent to Obligation of Seller    17

4.8    Seller’s Tax Deferred Exchange                         18

ARTICLE 5 REPRESENTATIONS, WARRANTIES AND COVENANTS
18

5.1
Representations and Warranties of Seller    18

5.2
Knowledge Defined    21

5.3
Survival of Seller's Representations and Warranties    22

5.4
Covenants of Seller    22

5.5
Representations and Warranties of Purchaser    25

5.6
Survival of Purchaser's Representations and Warranties    26

5.7
Covenants of Purchaser    26

5.8
Special Provisions Concerning Condominium Conversion    27

ARTICLE 6 DEFAULT
28

6.1
Default by Purchaser    28

6.2
Default by Seller    29

6.3
Notice of Default; Opportunity to Cure    29

6.4
Recoverable Damages    29

ARTICLE 7 RISK OF LOSS
30

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7.1
Damage    30

7.2
Definition of Major Damage    30

7.3
Seller's Insurance    31

ARTICLE 8 COMMISSIONS
31

8.1
Broker's Commission    31

8.2
Survival    31

ARTICLE 9 DISCLAIMERS AND WAIVERS
32

9.1
No Reliance on Documents    32

9.2
Disclaimers    32

9.3
Certain Definitions    34

9.4
Effect and Survival of Disclaimers    35

ARTICLE 10 ESCROW AGENT
35

10.1
Investment of Earnest Money    35

10.2
Intentionally Omitted    35

10.3
Payment on Demand    35

10.4
Exculpation of Escrow Agent    35

10.5
Stakeholder    35

10.6
Interest    36

10.7
Execution by Escrow Agent    36

ARTICLE 11 MISCELLANEOUS
36

11.1
Intentionally Deleted    36

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11.2
Intentionally Deleted    37

11.3
Assignment    37

11.4
Notices    37

11.5
Modifications    39

11.6
Calculation of Time Periods    39

11.7
Successors and Assigns    39

11.8
Entire Agreement    39

11.9
Further Assurances    39

11.10
Counterparts    40

11.11
Severability    40

11.12
Applicable Law    40

11.13
No Third Party Beneficiary    40

11.14
Employees    40

11.15
Seller's Access to Records after Closing    40

11.16
Schedules    41

11.17
Captions    41

11.18
Construction    41

11.19
Termination of Agreement    41

11.20
Survival    41

11.21
Time of Essence    42

11.22
Covenant Not to Record    42

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11.23
Limitation of Seller's Liability    42

11.24
JURY WAIVER    42

11.25
Attorney’s Fees     42

11.26
Wavier; Extension    42

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PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT (this “Agreement”) is made as of February 15,
2012 (the “Effective Date”), by and between ESTANCIA TULSA, LLC, a Delaware
limited liability company (“Seller”), and STEADFAST ASSET HOLDINGS, INC., a
California corporation (“Purchaser”).
FIRST AMERICAN TITLE INSURANCE COMPANY, a California corporation (“Escrow
Agent”; in its capacity as title insurer sometimes herein called the “Title
Company”) is a party to this Agreement for the limited purposes set forth
herein.
W I T N E S S E T H:
ARTICLE 1
PURCHASE AND SALE
1.1    Agreement of Purchase and Sale. Subject to the terms and conditions
hereinafter set forth, Seller agrees to sell and convey and Purchaser agrees to
purchase the following:
(a)    that certain tract or parcel of land being more particularly described on
Schedule 1.1(a), attached hereto and made a part hereof (the property described
in this clause (a) being herein referred to collectively as the “Land”);
(b)    all those rights, easements and appurtenances pertaining to the Land
(whether now or hereafter existing), including (i) all right, title and interest
of Seller (if any) in and to any streets, alleys or rights-of-way (whether open,
closed or proposed), within or adjacent to the Land, and (ii) all right, title
and interest of Seller with respect to any easements, covenants, agreements,
rights, privileges, tenements, hereditaments and appurtenances that now or
hereafter benefit or burden the Land (the property described in this clause (b)
herein referred to collectively as the “Related Rights”);
(c)    the buildings, structures, facilities, installations, fixtures and other
improvements of every kind on the Land, including specifically, without
limitation, those certain buildings containing apartment units and related
facilities and commonly known as Estancia (the property described in this clause
(c) being herein referred to collectively as the “Improvements”, and the Land,
the Related Rights and the Improvements being hereinafter sometimes collectively
referred to as the “Real Property”);
(d)    all of Seller's right, title and interest in, to and under all tangible
personal property upon the Land or within the Improvements, including
specifically, without limitation, appliances, equipment, furniture, furnishings,
carpeting, draperies and curtains, tools and supplies, and other items of
tangible personal property owned by Seller and used exclusively in connection

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with the ownership, use, maintenance or operation of the Land and the
Improvements, and including those items of tangible personal property identified
on Schedule 1.1(d), attached hereto and incorporated herein by this reference,
but excluding (i) cash and cash equivalents (except to the extent prorated at
Closing), (ii) except as provided in Section 1.5(iii) below, any reserves or
other deposits funded or made in connection with any financing encumbering the
Property, (iii) computer software and computer files, (iv) any time clock(s),
(v) personal property owned by tenants under the Leases, (vi) any equipment
installed by, or in connection with, any telecommunication or utility provider
and which is owned by any party other than Seller (excluding any reversionary
interest that Seller may have therein which shall be assigned to Purchaser to
the extent assignable), (vii) any items owned by employees of Seller or any
property manager, (viii) any items leased to Seller (excluding any interest that
Seller may have therein which shall be assigned to Purchaser to the extent
assignable), and (x) all brochures, advertising copy, promotional materials,
manuals, portfolios, binders, training materials and other items on which the
name “Flournoy” appears (the property described in this clause (d), other than
the excluded items, being herein referred to collectively as the “Tangible
Personal Property”).
(e)    all of Seller's right, title and interest as landlord or lessor in, to
and under all written agreements listed and described on Schedule 1.1(e) (the
“Rent Roll”) attached hereto and made a part hereof as well as under all similar
agreements hereafter executed by Seller in accordance with the terms of this
Agreement, pursuant to which any portion of the Land or Improvements is used or
occupied by anyone other than Seller (the property described in this clause (e)
being herein referred to collectively as the “Leases”);
(f)    all of Seller's right, title and interest in, to and under (i) the
Designated Service Contracts (as defined in Section 5.7 of this Agreement), (ii)
all assignable existing warranties and guaranties issued to or inuring to the
benefit of Seller in connection with the Improvements or the Tangible Personal
Property, and (iii) all governmental permits, licenses and approvals, if any,
belonging to or inuring to the benefit of Seller or pertaining to the Real
Property or the Tangible Personal Property, but only to the extent that such
permits, licenses and approvals are assignable; (iv) resident and tenant files
for current residents and tenants as of the Closing Date, (v) architectural and
civil plans and specifications and other surveys or studies (to the extent in
Seller's possession or control) and (vi) other non-confidential (as to
third-parties) and non-proprietary records owned by Seller and used in
connection with the operation of the Real Property or any part thereof, and
located on site as of the Closing Date (the property described in this
clause (f), other than the excluded items, being sometimes herein referred to
collectively as the “Intangible Property”).
1.2    Property Defined. The Land, the Related Rights, the Improvements, the
Tangible Personal Property, the Leases and the Intangible Property are
hereinafter sometimes referred to collectively as the “Property”.
1.3    Permitted Exceptions. The Property shall be conveyed, and Purchaser shall
accept the Property, subject to the matters which are, or are deemed to be,
Permitted Exceptions pursuant to ARTICLE 2 hereof (herein referred to
collectively as the “Permitted Exceptions”).
1.4    Purchase Price. Seller is to sell and Purchaser is to purchase the
Property for the

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total purchase price of Twenty Seven Million Nine Hundred Thousand and No/100
Dollars ($27,900,000.00) (the “Purchase Price”).
1.5    Payment of Purchase Price. The Purchase Price for the Property shall be
paid at Closing by Purchaser's assumption (the “Loan Assumption”) of Seller's
right and obligations under those certain documents evidencing or securing the
loan (the “Loan Documents”) identified on Schedule 1.5 (the “Loan”). In
connection with the Loan Assumption, Purchaser and Seller hereby agree as
follows:
(i)    Purchaser shall initiate the application process with the servicer
identified on Schedule 1.5 (the “Servicer”) for the transfer and assumption of
the Loan by Purchaser within three (3) business days following the Effective
Date and thereafter diligently and in good faith pursue timely approval of the
Loan Assumption. The Seller agrees to cooperate with Purchaser in connection
therewith, provided that Seller shall not be obligated to incur any expense
(except as otherwise expressly provided herein) or material liabilities in
connection therewith.
(ii)    Purchaser shall pay all assumption fees, release fees, expenses, charges
and escrow contributions required by the lender or Servicer in connection with
the Loan Assumption.
(iii)    At Closing, Seller shall assign to Purchaser and receive a credit for
the then current balances held in escrow for taxes, insurance, replacement
reserves, operating deficits, working capital reserves and all other
escrow/reserve accounts as outlined on Schedule 1.5.
(iv)    The Loan Assumption shall specifically include a release of liability
for any “carveout,” environmental or other guaranty obligations of Seller and
Seller's principals arising or resulting from events occurring after the Closing
Date in form and substance consistent with Servicer’s (or Lender’s) customary
form (the “Carveout Release”). In the event the Carveout Release is not
delivered to Seller concurrently with Closing, Seller shall have the option to
terminate this Agreement, in which case (if exercised) the Earnest Money shall
be returned to Purchaser and thereafter neither party shall have any further
liability or obligation to the other, except for those covenants specifically
stated to survive termination.
(v)    Purchaser acknowledges and agrees that its ultimate parent or other
entity satisfactory to the Servicer and/or lender (“Parent”) may be required to
execute and deliver agreements guaranteeing certain environmental and “carveout”
obligations to the extent arising after Closing in such form as the Servicer or
lender may reasonably require (the “Guaranties”). Purchaser shall cause the
Parent to cooperate in good faith and timely provide such information as is
reasonably required with respect to the Guaranties. Purchaser's and/or Parent's
failure to provide the Guaranties shall constitute a Purchaser’s default.
(vi)    The Equity (as hereinafter defined) shall be paid in full at Closing to
a bank account of Escrow Agent designated by Escrow Agent in writing to
Purchaser prior to the Closing (“Escrow Agent's Account”) as provided in Section
4.3(a). As used herein, “Equity” means the difference between the Purchase Price
for the Property and the then current outstanding principal

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balance of the Loan as of 11.59 pm on the day prior to the Closing Date, as
adjusted by credits and prorations provided for herein.
1.6    Earnest Money.
(a)    Within three (3) business days following the Effective Date, Purchaser
shall deposit with Escrow Agent the sum of Five Hundred Thousand and No/100
Dollars ($500,000.00) by wire transfer of immediately available funds (the
“Initial Earnest Money”) in accordance with the wiring instructions attached
hereto as Schedule 1.6(a). The Initial Earnest Money and, if applicable, the
Additional Earnest Money (as defined in Section 4.1) are collectively referred
to hereinafter as the “Earnest Money”. The Earnest Money shall be applied to the
Purchase Price on the Closing Date and paid to Seller through the escrow process
outlined herein.
(b)    If Purchaser fails to deliver any portion of the Earnest Money to the
Escrow Agent within the time period specified above, Seller shall have the right
to terminate this Agreement, and upon such termination, Purchaser and Seller
shall have no further rights, or obligations hereunder, except those which
expressly survive termination of this Agreement.
(c)    In any event, if Purchaser is entitled to have the Earnest Money returned
to Purchaser, pursuant to any provision of this Agreement, One Hundred and
no/100 Dollars ($100.00) of the Earnest Money shall nevertheless be paid to
Seller as good and sufficient consideration for entering into this Agreement. In
addition, Seller acknowledges that Purchaser, in evaluating the Property and
performing its due diligence investigation of the Property, will devote internal
resources and incur expenses, and that such efforts and expenses of Purchaser
also constitute good, valuable and sufficient consideration for this Agreement.
ARTICLE 2    
TITLE AND SURVEY
2.1    Title Examination; Commitment for Title Insurance. Seller has obtained
from Title Company, at Seller's expense, and delivered to Purchaser the First
American Title Insurance Company Title Commitment Number 1494309-OK11, having an
effective date of October 7, 2011 (together with all exceptions referenced
therein, the “Title Commitment”) and covering the Property.
2.2    Survey. Purchaser acknowledges that Seller has, at Seller's expense,
delivered to Purchaser that certain as-built survey of the Real Property
prepared by Sack and Associates, Inc. dated December 13, 2006, last revised
August 16, 2007, and bearing the seal of Theodore A. Sack, Oklahoma Registered
Land Surveyor No. 1139. Said survey or any update thereto or new survey obtained
by Purchaser shall constitute the “Survey” hereunder. For purposes of the Deed
to be delivered to Purchaser at the Closing, the legal description the Property
shall be the legal description attached hereto as Schedule 1.1(a), less and
except any right-of-way or other conveyances previously made by Seller. If,
however, the metes and bounds description drawn from the Survey reflects a legal
description different from the legal description attached hereto as Schedule
1.1(a), Seller shall also deliver a quit claim deed, at Closing, containing the
legal description drawn from the Survey

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(or update thereto).
2.3    Title Objections; Cure of Title Objections.
(a)    Purchaser or its attorneys shall have until that date which is twenty
(20) days from the Effective Date (the “Title Objection Deadline”) to notify
Seller and its attorneys, in writing, of such objections as Purchaser may have
to the Title Commitment (including the title exception documents referred to
therein) or Survey, other than the Permitted Exceptions described in clauses (a)
through (d) of Section 2.4. Any item contained in the Title Commitment, any
matter shown on the Survey or any document that is of record and properly
indexed as of the effective date of such initial title examination to which
Purchaser does not object on or before the Title Objection Deadline shall be
deemed a “Permitted Exception”.
(b)    In the event Purchaser shall notify Seller of objections to title or to
matters shown on a Survey on or before the Title Objection Deadline, Seller
shall have the right, but not the obligation (except as otherwise expressly
provided below), to cure such objections. On or before the fifth (5th) day
following Seller's receipt of Purchaser's notice of objections, Seller shall
notify Purchaser in writing whether Seller elects to attempt to cure such
objections (and Seller's failure to provide such a notice shall be deemed an
election by Seller not to cure any such objection). If Seller elects to attempt
to cure, then Seller shall use commercially reasonable efforts to attempt to
remove, satisfy or cure the same. If Seller elects (or is deemed to have
elected) not to cure any objections specified in Purchaser's notice, or if
Seller notifies Purchaser of Seller's intent to cure any objection and
thereafter Seller fails or is unable to effect a cure prior to Closing (or any
date to which the Closing has been extended), then in either such case Purchaser
shall have the right to elect one, but not both, of the following options, which
election must in each case be made within the time period provided in paragraph
(c) below:
(A)    to accept a conveyance of the Property subject to the Permitted
Exceptions, specifically including any matter objected to by Purchaser which
Seller is unwilling or unable to cure, and without reduction of the Purchase
Price; or
(B)    to terminate this Agreement by sending written notice thereof to Seller,
and upon delivery of such notice of termination, this Agreement shall terminate
and the Earnest Money shall be returned to Purchaser within two (2) business
days in accordance with Section 1.5 of this Agreement, and thereafter neither
party hereto shall have any further rights, obligations or liabilities hereunder
with respect to the Property, except to the extent that any right, obligation or
liability set forth herein expressly survives termination of this Agreement.
(c)    If Seller notifies Purchaser that Seller does not intend to attempt to
cure any title objection, or if Seller is deemed to have elected not to cure any
title objections, or if Seller notifies Purchaser of Seller's intent to cure any
objection and Seller later notifies Purchaser that Seller has failed or will be
unable to effect a cure thereof, then in any such case Purchaser shall, within
five (5) days after receiving Seller's notice or the date of Seller's deemed
election or failed cure, as applicable, notify Seller in writing whether
Purchaser shall elect to accept the conveyance

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under clause (b)(i) above or to terminate this Agreement under clause (b)(ii)
above (with Purchaser's failure to provide such a notice deemed an election by
Purchaser to accept conveyance under clause (b)(i) above).
(d)    Notwithstanding anything contained herein to the contrary, Seller shall
be obligated at Closing to discharge (i) all mortgages of Seller (regardless of
whether Purchaser objects to such mortgage) other than the mortgage securing the
Loan, (ii) all monetary liens arising by, through or under Seller, and (iii) any
exceptions or encumbrances to title which are voluntarily created by, under or
through Seller after the date hereof in violation of Section 2.6 hereof. The
term “mortgage” as used herein includes any mortgage, deed of trust, deed to
secure debt and similar security instrument securing an indebtedness of Seller
and encumbering the Property or any portion thereof; the terms “discharge” and
“discharged” as used herein include compliance with a statutory bonding
procedure that has the legal effect of removing the mortgage or item as a lien
on the Property or otherwise allows the mortgage or item to be removed from the
title exceptions in the Title Policy (as defined below).
2.4    Conveyance of Title. At Closing, Seller shall convey and transfer the
Property to Purchaser. It shall be a condition to Purchaser's obligation to
close this transaction that title to the Real Property conveyed and transferred
to Purchaser shall be such title to the Real Property as will enable the Title
Company to issue to Purchaser an extended coverage American Land Title
Association (ALTA) Form 2006 Owner's Policy of Title Insurance (the “Title
Policy”) covering the Real Property, in the full amount of the Purchase Price,
subject to the following matters, which shall be deemed to be Permitted
Exceptions:
(a)    the rights of tenants, as tenants only, without any right to acquire any
portion of the Property, under the Leases described in the Rent Roll and any new
Leases entered into between the Effective Date and Closing and (if required)
approved by Purchaser in accordance with the terms of this Agreement;
(b)    the lien of all ad valorem real estate taxes and assessments not yet due
and payable as of the date of Closing, subject to adjustment as herein provided;
(c)    local, state and federal laws, ordinances or governmental regulations,
including but not limited to, building, zoning and land use laws, ordinances and
regulations, now or hereafter in effect relating to the Property;
(d)    the mortgage securing the Loan and all other matters identified in
Schedule 2.4(d) (the B-II title exceptions shown in the Title Commitment other
than the standard printed exceptions which will be deleted upon Seller's
delivery of the documents identified in Section 4.2 hereof) attached hereto and
made a part hereof, except to the extent Seller agrees to cure any such matters
pursuant to Section 2.3 or 2.5 hereof;
(e)    additional items, if any, appearing of record or shown on the
Survey, except to the extent Seller agrees to cure any such matters pursuant to
Section 2.3 or 2.5 hereof; and

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(f)    additional items, if any, approved by Purchaser pursuant to Section 2.6
hereof.
2.5    Pre-Closing “Gap” Title/Survey Defects. Whether or not Purchaser shall
have furnished to Seller any notice of title objections pursuant to the
foregoing provisions of this Agreement, Purchaser may, at or prior to Closing,
notify Seller in writing of any objections to title or survey matters having a
material effect on the operation or value of the Property and first raised by
the Title Company or the Surveyor between (a) the effective date of the
applicable Title Commitment or Survey and (b) the Closing Date; provided,
however, that Purchaser must notify Seller of any such objections within five
(5) business days of Purchaser's first receipt of the updated Title Commitment,
updated survey or other document, whichever first provides notice of the
condition giving rise to any such objection. With respect to any objections to
title or survey matters set forth in such notice, except for objections arising
or resulting from Seller's breach of the covenant contained in Section 2.6
hereof, Seller shall have the same option to cure and Purchaser shall have the
same option to accept title subject to such matters or to terminate this
Agreement as those which apply to any notice of objections made by Purchaser on
or before the Title Objection Deadline.
2.6    Seller's Covenant Not to Encumber. Seller agrees that, between the
Effective Date and the Closing Date, Seller will not sell, assign, rent, convey
(absolutely or as security), grant a security interest in, or otherwise encumber
or dispose of, the Property (or any part thereof or estate therein) in any
manner that will survive Closing, except as approved in writing by Purchaser or
as expressly provided in this Agreement. Notwithstanding the foregoing, Seller
shall have the right to (i) continue leasing apartment units in the Property in
the manner described in Section 5.4(b) hereof, (ii) terminate, amend or enter
into Service Contracts in the manner described in Section 5.4(g) hereof, and
(iii) use, deplete, remove or replace items of Tangible Personal Property in the
ordinary course of business, provided any appliances, leasing office and pool
furniture, fitness center equipment and other similar items of equipment or
furniture so removed by Seller are promptly replaced by Seller, at its cost,
with items of comparable value and utility.
ARTICLE 3    
INSPECTION
3.1    Right of Inspection.
(a)    Beginning upon the Effective Date and continuing thereafter so long as
this Agreement remains in full force and effect, Purchaser and its agents,
representatives, contractors and consultants shall, at Purchaser’s sole cost and
expense and upon twenty-four (24) hours prior telephonic notice to Seller, have
the right to make physical inspections of the Property (the “Inspections”) and
to examine at such place or places at the Property, in the offices of the
property manager, any operating files maintained by Seller or its property
manager in connection with the ownership, leasing, maintenance and/or management
of the Property, including, without limitation, the Leases, lease files, Service
Contracts, bills, invoices, receipts and other general records relating to the
income and expenses of the Property, correspondence, surveys, plans and
specifications, warranties for services and materials provided to the Property
and similar materials, and a copy of

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any brochures, advertising copy, promotional materials, manuals, portfolios,
binders, training materials and other items, but excluding Seller's internal
memoranda, financial projections and tax records, and similar proprietary or
confidential information. Seller shall have the right, but not the obligation,
to have one of its representatives accompany Purchaser or its representatives on
each such inspection or examination. Seller shall reasonably cooperate with
Purchaser in its inspections and examinations of the Property, but Seller shall
not be obligated to incur any liability, undue time commitment or expense in
connection therewith. In addition to the foregoing, Seller shall provide to
Purchaser, within three (3) days after the date hereof, at the sole expense of
Seller, all documents pertaining to the Property that have been prepared by, for
or at the request of Seller or are in the possession or control of Seller or its
affiliates or agents described on Schedule 3.1 attached hereto; Seller hereby
acknowledges and agrees that the following in the possession or control of
Seller as will be provided as required in the previous sentence: monthly
operating statements (year-to-date and 3-year historical); year-end financial
statements, audited if available (past 3 years); and general ledger
(year-to-date and 3-year historical).
(b)    Purchaser’s inspections of the Property shall not damage the Property in
any respect, shall not be invasive in any respect (including, without
limitation, soil borings, test pits, groundwater testing, or Phase II or Phase
III environmental testing), and shall be conducted in accordance with standards
customarily employed in the industry and in compliance with all governmental
laws, rules and regulations. Following each such entry by the Purchaser or its
agents, representatives, contractors and consultants with respect to the
Inspections, Purchaser shall promptly restore, or cause to be restored, the
Property to substantially its original condition as existed immediately prior to
any such Inspections. Purchaser shall not have the right to submit any samples
or other materials to any testing laboratory or similar facility without
obtaining the prior written consent of Seller.
(c)    Purchaser shall indemnify, hold harmless and defend Seller, its members,
and their respective, members, affiliates, indirect owners (including trusts and
plans), trustees, officers, directors, shareholders, agents and employees from
and against any and all claims, demands, causes of action, liabilities, losses,
costs, damages and expenses (including reasonable attorneys' fees and expenses
and court costs incurred in defending any such claim or in enforcing this
indemnity) of whatsoever nature (for purposes of this Section 3.1, individually
a “Claim” and collectively, “Claims”) that are incurred by Seller or any other
indemnified party arising out of or in connection with the acts or omissions of
Purchaser and its agents, representatives, contractors and consultants, or any
of them, in connection with the Inspections of the Property, including but not
limited to Claims arising out of or in connection with personal injury or death
of persons, loss, destruction or damage to property, or liens or claims of lien
filed against the Property, but excluding any Claims to the extent of any gross
negligence or willful misconduct of Seller or any other indemnified party.
Notwithstanding the foregoing, Purchaser shall have no liability for
pre-existing conditions discovered by any inspection of the Real Property except
to the extent actually aggravated by Purchaser. This Section 3.1(c) shall
survive Closing or any termination of this Agreement.
3.2    Right of Termination. Seller agrees that in the event Purchaser
determines, in Purchaser's sole and absolute discretion, that it does not wish
to acquire the Property for any reason or no reason, then Purchaser shall have
the right to terminate this Agreement by giving written

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notice of such termination to Seller on or before thirty (30) days following the
Effective Date (the “Inspection Date”). Upon any such termination of this
Agreement pursuant to Purchaser's rights under this Section 3.2 the Earnest
Money shall be promptly returned to Purchaser in accordance with Section 1.6
hereof, and Purchaser and Seller shall have no further rights and obligations
hereunder except those which expressly survive termination of this Agreement. If
Purchaser fails to give Seller timely notice of termination on or before the
Inspection Date, then Purchaser shall no longer have the right to terminate this
Agreement under this Section 3.2 and (subject to any contrary provisions of this
Agreement) shall be bound to proceed to Closing and consummate the transaction
contemplated hereby pursuant to the terms of this Agreement. Time is of the
essence with respect to the provisions of this Section 3.2. The period
commencing on the Effective Date and ending on the Inspection Date is sometimes
referred to herein as the “Inspection Period”.
3.3    Confidentiality.
(a)    Purchaser acknowledges that all reports and other information provided to
Purchaser (the “Deliveries”) under this Agreement or separate arrangement with
Seller or Broker are for informational purposes only and shall not be construed
as a representation or warranty on the part of Seller or any other party
regarding the Property. Notwithstanding any provision of this Agreement,
Purchaser shall not have access to, and Seller shall not be obligated to make
available to Purchaser, any confidential, proprietary or privileged information
of Seller related to the Property, such excluded materials to include Seller’s
internal memoranda, financial projections, operating budgets, appraisals, tax
returns and similar proprietary, confidential or privileged information.
Notwithstanding anything in the foregoing to the contrary, Seller will make
available to Purchaser financial statements, operating reports and rent rolls
used in Seller’s ordinary course of business.
(b)    The existence and contents of this Agreement, the negotiations of parties
with respect to the possible sale and purchase of the Property and any matters
disclosed by any Inspections undertaken by Purchaser with respect to the
Property and any additional information furnished by Seller to Purchaser from
time to time (including, without limitation, the Deliveries) shall be kept
confidential and shall not be disclosed to any third parties without the consent
of both parties hereto, except for any disclosure (i) that may be required by
law to be made to any applicable governmental or quasi-governmental authorities
or any other person or entity, (ii) made after the Closing Date, or (iii) of
information otherwise in the public domain. Both parties recognize the need to
disclose, and agree to the disclosure of, certain aspects of this transaction to
their respective lenders, investors, accountants, attorneys, affiliates,
employees, agents and other consultants. Neither party is responsible for the
actions of third parties as to the disclosure of confidential information, but
each party agrees to inform their lender, investors, accountants, attorneys,
affiliates, employees, agents and other consultants of the confidentiality of
this transaction and all such other information and, upon request of the other,
agrees to use reasonable efforts to obtain confidentiality agreements from such
third parties. From and after Closing, either party may issue a press release
describing the transaction, provided that neither of Seller or Purchaser may
include the identity of the other party in such press release unless such press
release is approved in advance by the other party. Notwithstanding anything in
this Agreement to the contrary, Seller hereby acknowledges and agrees that
Purchaser or its affiliates, agents, consultants and/or representatives may
communicate with any local governmental authority having jurisdiction over the
Property for the

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purpose of gathering information reasonably necessary in connection with
conducting its Inspections of the Property. Any separate confidentiality,
access, or similar agreement between Seller and Purchaser are hereby expressly
terminated.
(c)    If this Agreement is terminated, Purchaser shall, within seven (7) days
from the date of such termination, return or cause to be returned to Seller, all
Deliveries and, if requested by Seller and upon reimbursement of Purchaser's
actual costs therefor, deliver to Seller copies of all third party reports
prepared on behalf of Purchaser. The provisions of this Section 3.3 shall
survive the termination of this Agreement.
ARTICLE 4    
CLOSING
4.1    Time and Place. The consummation of the transaction contemplated hereby
(“Closing”) shall be held at the office of Escrow Agent (Six Concourse Parkway,
Suite 2000, Atlanta, GA 30328) on a date specified by Purchaser, which date
shall be not less than three (3) days after the date Purchaser and Seller
receive written approval from the Servicer that the Loan Assumption has been
approved, but not later than sixty (60) days following the Effective Date (or
such extended date as may be provided under other provisions of this Agreement),
via escrow funds and fully executed documents. At Closing, Seller and Purchaser
shall perform the obligations set forth in, respectively, Section 4.2 and
Section 4.3. The Closing may be held at such other place or such earlier time
and date as Seller and Purchaser shall mutually approve in writing. The date on
which the Closing is scheduled to occur hereunder (or, if earlier, the date on
which Closing occurs) is sometimes referred to herein as the “Closing Date”. The
parties will endeavor to “pre-close” on the business day prior to the Closing
Date, so as to allow the wire transfers of the Purchase Price to occur at the
opening of business on the Closing Date or as promptly thereafter as practical.
Notwithstanding the foregoing, on or before the Closing Date, Purchaser shall
have the right to extend the outside date by which Closing must occur for one
(1) additional thirty (30) day period by (a) notifying Seller in writing of
Purchaser's election to so extend Closing and (b) depositing with Escrow Agent
an additional Two Hundred Fifty Thousand and No/100 Dollars ($250,000.00)
earnest money for such thirty (30) day period (the “Additional Earnest Money”).
Notwithstanding anything to the contrary contained herein, in the event
Purchaser fails to close (for any reason or no reason other than Seller's
default) on or before the last day of such thirty (30) day period following
exercising its right to extend the Closing Date as provided in the preceding
sentence, all Earnest Money shall be disbursed to Seller in accordance with
Section 6.1 hereof.
4.2    Seller's Obligations at Closing. At Closing, Seller shall:
(a)    deliver to Purchaser a duly executed limited or special warranty deed in
the form attached hereto as Schedule 4.2(a) and by this reference made a part
hereof, conveying the Real Property to Purchaser subject only to the Permitted
Exceptions (the “Deed”);
(b)    deliver to Purchaser two counterparts of a bill of sale and assignment
and assumption of leases and service contracts, in the form attached hereto as
Schedule 4.2(b) and by this reference made a part hereof, duly executed by
Seller, pursuant to which (i) Seller shall convey

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the Tangible Personal Property and the Intangible Property to Purchaser, and
(ii) Seller shall assign to Purchaser, and Purchaser shall assume from and after
the date of Closing, Seller's interest in and to the Leases and Designated
Service Contracts, as amended or supplemented pursuant to this Agreement (the
“Bill of Sale and Assignment”);
(c)    join with Purchaser to execute a notice (the “Tenant Notice”) in the form
of Schedule 4.2(c) attached hereto, which Purchaser shall send to each tenant
under each of the Leases informing such tenant of the sale of the Property and
of the assignment to Purchaser of Seller's interest in, and obligations under,
the Leases (including, if applicable any security deposits) and directing that
all rent and other sums payable after the Closing under each such Lease shall be
paid as set forth in the notice;
(d)    deliver to Purchaser a certificate (“Seller's Closing Certificate”),
dated as of the date of Closing and duly executed by Seller, in the form of
Schedule 4.2(d) attached hereto, stating that the representations and warranties
of Seller contained in Section 5.1 of this Agreement are true and correct in all
material respects as of the date of Closing (with appropriate modifications to
reflect any changes therein or identifying any representation or warranty which
is not, or no longer is, true and correct and explaining the state of facts
giving rise to the change); provided, however, that the inclusion of any change
or exception in such certificate shall not prejudice Purchaser's rights under
this Agreement with respect to the subject matter of such change or exception.
The Seller's Closing Certificate shall include an updated Rent Roll dated no
earlier than two (2) business days prior to the Closing Date as to which Seller
shall make the same representations and warranties, as of the date of such Rent
Roll, as Seller makes under Section 5.1(d) with respect to the Rent Roll
attached hereto;
(e)    deliver to Purchaser such evidence as the Title Company may reasonably
require as to the authority of the person or persons executing documents on
behalf of Seller;
(f)    deliver to Purchaser an affidavit duly executed by Seller stating that
Seller is not a “foreign person” as defined in the Federal Foreign Investment in
Real Property Tax Act of 1980 and the 1984 Tax Reform Act;
(g)    deliver to the Title Company a title insurance affidavit, if required by
the Title Company, duly executed by Seller or a representative of Seller, in
form and content reasonably satisfactory to Seller and the Title Company
regarding construction, debts, liens and parties in possession and other matters
customarily required by Title Company and, if applicable, a customary “gap”
indemnity;
(h)    deliver to Purchaser at the place of Closing or at the Property the
Leases together with such leasing and property files and records, and other
Deliveries, all to the extent not previously delivered and the originals thereof
to the extent in Seller's possession or control;
(i)    deliver to Purchaser possession and occupancy of the Property, subject to
the Permitted Exceptions, and deliver to Purchaser all inventories of supplies
on hand at the Property owned by Seller, if any, at no additional cost to
Purchaser;

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(j)    deliver a closing statement(s) evidencing the transaction contemplated by
this Agreement and such additional documents, including without limitation
transfer tax or similar forms or returns, if any, as shall be reasonably
requested by the Title Company or required to consummate the transaction
contemplated by this Agreement;
(k)    if the legal description attached hereto as Schedule 1.1(a) differs from
the legal description of the Property drawn from the Survey, Seller shall at
Closing deliver (in addition to the Deed) a quit claim deed conveying the
Property pursuant to the legal description drawn from the Survey, which legal
description shall be subject to Seller's approval, which approval shall not be
unreasonably withheld;
(l)    deliver a Release and Assumption Agreement (“Release and Assumption
Agreement”) and/or similar and related agreement(s) relating to the Loan
Documents in such form as the Servicer and/or lender may require; and
(m)    if not contained in the Release and Assumption Agreement, deliver
confirmation from the Servicer as to the outstanding balance of the Loan and
that no defaults are continuing thereunder.
4.3    Purchaser's Obligations at Closing. At Closing, Purchaser shall:
(a)    deliver to Escrow Agent the full amount of the Equity as increased or
decreased by prorations and adjustments as herein provided, prior to 2:00 p.m.
(Eastern time) on the Closing Date, in immediately available federal funds wire
transferred to Escrow Agent's Account, and deliver to Escrow Agent instructions
to release the full amount of the Purchase Price, as increased or decreased by
prorations and adjustments as herein provided, to Seller;
(b)    join Seller in execution of all counterparts of the Bill of Sale and
Assignment and the Tenant Notice. In connection with the Tenant Notice,
Purchaser shall deliver to each and every tenant of the Property under a Lease
thereof a signed statement acknowledging Purchaser's receipt and responsibility
for each tenant's security deposit (to the extent credited or delivered by
Seller to Purchaser at Closing), if any, all in compliance with and to the
extent required by the applicable law. The provisions of this sub-section shall
survive Closing;
(c)    deliver to Seller such evidence as the Title Company may reasonably
require as to the authority of the person or persons executing documents on
behalf of Purchaser;
(d)    deliver to Seller a certificate dated as of the date of Closing and duly
executed by Purchaser, (i) reaffirming the provisions of Article 9 and
confirming that such provisions remain and will continue in full force and
effect as of and after the Closing, and (ii) stating that the representations
and warranties of Purchaser contained in Section 5.5 of this Agreement are true
and correct in all material respects as of the date of Closing (with appropriate
modifications to reflect any changes therein or identifying any representation
or warranty which is not, or no longer is, true and correct and explaining the
state of facts giving rise to the change); provided, however, that the inclusion
of any change or exception in such certificate shall not prejudice Seller's
rights under this

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Agreement with respect to the subject matter of such change or exception,
including the right of Seller to terminate this Agreement and receive the
Earnest Money;
(e)    deliver a closing statement(s) evidencing the transaction contemplated by
this Agreement and such additional documents as shall be reasonably requested by
the Title Company or required to consummate the transaction contemplated by this
Agreement; and
(f)    deliver the Release and Assumption Agreement and all other documents
reasonably requested by the Servicer and/or lender to consummate the Loan
Assumption.
4.4    Credits and Prorations.
(a)    All income and expenses in connection with the operation of the Property
shall be apportioned as of 11:59 p.m. (Eastern Standard time) on the day prior
to the Closing Date, as if Purchaser were vested with title to the Property
during the entire Closing Date, such that, except as otherwise expressly
provided to the contrary in this Agreement, Seller shall have the benefit of
income and the burden of expenses for the day preceding the Closing Date and the
Purchaser shall have the benefit of income and the burden of expenses for the
Closing Date and thereafter. Items (1)-(5) below will be prorated at Closing
utilizing the information known at that time. A post-closing “true-up” shall
take place within ninety (90) days of the Closing Date to adjust the prorations
of said items (1), (3), (4) and (5), if necessary, and within a reasonable time
to adjust the proration of said item (2), if necessary. Such prorated items
shall include, without limitation, the following:
(1)    rents, if any, based on the amount collected for the current month. The
term “rents” as used in this Agreement includes all payments received from
tenants under the Leases other than refundable deposits, previously paid
application fees, reimbursement payments which are attributable to periods prior
to Closing, late charges which are attributable to periods prior to Closing, and
previously paid termination payments (which refundable deposits shall be treated
as set forth in Section 4.4(b)(1), but such other amounts shall be retained by
Seller);
(2)    ad valorem taxes and assessments levied against the Property (including
personal property taxes on the Tangible Personal Property), which shall be
prorated as set forth in Section 4.4(b)(2) hereof;
(3)    payments or amounts due under the Designated Service Contracts. To the
extent any rebate, concession or commission payable to Seller under any
Designated Service Contract has accrued before Closing but has not been paid to
Seller, Seller shall receive a credit for such accrued amounts at Closing;
Seller shall retain any signing bonus or similar payments received by Seller
before Closing; provided, however, that with respect to any new Service Contract
entered into in accordance with Section 5.4(g) that contains any rebate,
concession, commission bonus or similar payment to which Seller would be
entitled, Purchaser’s prior consent to such new Service Contract was obtained
(even if such consent for such new Service Contract would not otherwise have
been required under said Section 5.4(g));

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(4)    gas, electricity, water and other utility charges for which Seller is
liable, if any, such charges to be apportioned at Closing on the basis of the
most recent meter reading occurring prior to Closing or the most recent utility
bill received by Seller, as applicable, including, without limitation, water
charges not yet due and payable to such utility provider at Closing, but which
amounts are customarily billed directly to Seller and reimbursed by tenants; and
(5)    any other operating expenses or other items pertaining to the Property
which are customarily prorated between a purchaser and a seller in comparable
commercial transactions in the area in which the Property is located.
(b)    Notwithstanding anything contained in the foregoing provisions:
(1)    At Closing, (A) Seller shall credit to Purchaser the amount of such
unforfeited resident deposits as shown on the rent roll, and (B) Purchaser shall
credit to the account of Seller all refundable cash or other deposits posted
with utility companies serving the Property, or, at either party's option,
Purchaser shall contract directly with the utility companies and Seller shall be
entitled to receive and retain such refundable cash and deposits; provided that
Purchaser and Seller will cooperate so that utility service to the Property is
not interrupted. For the purposes of this Section 4.4(b)(1) the term
“unforfeited resident deposits” means any refundable resident deposits which are
held by Seller and which Seller has not applied, and is not entitled to apply,
against delinquent rents, property damage or otherwise in accordance with the
applicable Lease.
(2)    Any ad valorem taxes for the current year paid at or prior to Closing
shall be prorated based upon the amounts actually paid for the current tax year.
If all taxes and assessments for the current tax year have not been paid before
Closing, then Seller shall be charged at Closing an amount equal to that portion
of such taxes and assessments which relates to the period before Closing and
Purchaser shall pay the taxes and assessments prior to their becoming
delinquent. Any such apportionment made with respect to a tax year for which the
tax rate or assessed valuation, or both, have not yet been fixed shall be based
upon the tax rate and/or assessed valuation last fixed. To the extent that the
actual taxes and assessments for the current tax year differ from the amount
apportioned at Closing, the parties shall make all necessary adjustments by
appropriate payments between themselves following Closing promptly following the
availability of the final tax bills. For avoidance of doubt, any refunds
generated from appeal of ad valorem taxes for year(s) prior to the current year
shall remain the property of Seller and paid to Seller by Purchaser, if and to
the extent received by Purchaser; provided, however that Seller shall have no
right to commence any appeal after the Closing Date.
(3)    Gas, electricity, water and other utility charges referred to in
Section 4.4(a)(4) above which are payable by any tenant directly to a third
party

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shall not be apportioned hereunder, and Purchaser shall accept title subject to
any of such charges which are unpaid and Purchaser shall look solely to the
responsible tenant for the payment of the same.
(4)    If Seller shall have paid any gas, electricity, water or other utility
charges referred to in Section 4.4(a)(4) above directly to a third party which
are reimbursable by tenants, but shall not have been reimbursed therefor by the
time of Closing, then Purchaser shall credit to Seller an amount equal to all
such charges so paid by Seller.
(5)    As to gas, electricity and other utility charges referred to in
Section 4.4(a)(4) above, Seller may on notice to Purchaser elect to pay one or
more of all of such items accrued to the Closing Date directly to the person or
entity entitled thereto, and to the extent Seller so elects and the utility
company agrees to look solely to Seller for payment of any such item accrued
prior to the Closing Date, such item shall not be apportioned hereunder, and
Seller's obligation to pay such item with respect to the period prior to Closing
directly in such case shall survive the Closing.
(6)    Seller shall pay in full all leasing commissions and locators' and
finders' fees, if any, due to leasing or other agents (pursuant to a contractual
agreement with Seller) for each Lease and Lease renewal entered into by Seller
prior to the Closing Date promptly when due.
(7)    The Tangible Personal Property is included in this sale, without further
charge.
(8)    Unpaid and delinquent rent collected by Seller and Purchaser after the
date of Closing shall be delivered as follows: (a) if Seller collects any unpaid
or delinquent rent for the Property, Seller shall, within fifteen (15) days
after the receipt thereof, deliver to Purchaser any such rent which Purchaser is
entitled to hereunder relating to the date of Closing and any period thereafter,
and (b) if Purchaser collects any unpaid or delinquent rent from the Property,
Purchaser shall, within fifteen (15) days after the receipt thereof, deliver to
Seller any such rent which Seller is entitled to hereunder relating to the
period prior to the date of Closing. Seller and Purchaser agree that all rent
received by Seller or Purchaser after the Closing shall be applied first to
current rentals and then to delinquent rentals, if any, in inverse order of
maturity. Purchaser will make a good faith effort after Closing to collect all
rents in the usual course of Purchaser's operation of the Property, but
Purchaser will not be obligated to incur any expense or institute any lawsuit or
other collection procedures to collect delinquent rents. Notwithstanding the
foregoing, Seller shall have the sole right to collect rents, if any, which are
unpaid or delinquent as of Closing, from tenants who are no longer in occupancy
as of the Closing (and Purchaser shall promptly deliver any such rents to Seller
if received by Purchaser after Closing).

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(9)    The provisions of this Section 4.4(b) shall survive Closing.
(c)    The Purchase Price shall be adjusted for any “rent ready” credit under
Section 5.4(e) hereof.
4.5    Closing Costs. Seller shall pay (a) the fees of any counsel representing
it in connection with this transaction, (b) the cost of the Survey provided by
Seller (but not the cost of any update or revision to the Survey), (c) the base
premium for the Title Policy in the amount of the Purchase Price and the
simultaneous issue charge for any lender's policy, (d) the costs of curing all
title objections for which Seller is responsible under this Agreement (including
if by endorsement), (e) the costs of recording all mortgage cancellations, (f)
one-half of all applicable transfer taxes, documentary stamp taxes and similar
charges relating to transfer of the Property, (g) one-half of any escrow fees
charged by the Escrow Agent and (h) all fees payable to Broker. Purchaser shall
pay (A) the fees of any counsel representing Purchaser in connection with this
transaction, (B) the fees for recording the Deed, (C) the premiums for any title
insurance endorsements requested by Purchaser or its lender or title insurance
coverage in excess of the Purchase Price, (D) the costs of the Loan Assumption
as provided in Section 1.5 hereof, (E) the cost of Purchaser's inspections of
the Property, (F) the cost of any updates or revisions to the Survey, including
updates or revisions necessary to comply with the requirements of Purchaser or
its lender, (F) one-half of all applicable transfer taxes, documentary stamp
taxes and similar charges relating to transfer of the Property, and (G) one-half
of any escrow fees charged by the Escrow Agent. All other costs and expenses
incident to this transaction and the closing thereof shall be paid by the party
incurring same.
4.6    Conditions Precedent to Obligation of Purchaser. The obligation of
Purchaser to consummate the transaction hereunder shall be subject to the
fulfillment on or before the date of Closing (or such earlier time as otherwise
required hereby) of all of the following conditions, any or all of which may be
waived by Purchaser in its sole discretion:
(a)    Seller shall have delivered to Escrow Agent all of the items required to
be delivered to Purchaser by Seller or Seller's agents pursuant to the terms of
this Agreement, including but not limited to, those provided for in Section 4.2.
(b)    All of the representations and warranties of Seller contained in this
Agreement shall be true and correct in all material respects as of the date of
Closing (with appropriate modifications permitted under this Agreement and not
adverse to Purchaser).
(c)    Seller shall have performed and observed, in all material respects, all
covenants and agreements of this Agreement to be performed and observed by
Seller as of the date of Closing.
(d)    All other conditions precedent to Purchaser's obligation to consummate
the transaction hereunder (if any) which are expressly set forth in this
Agreement shall have been satisfied on or before the date of Closing.

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(e)    The Title Company is ready, willing and able to issue the Title Policy.
(f)    The Loan Assumption has been approved by Servicer.
(g)    There shall exist no pending actions, suits, arbitrations, claims,
attachments, proceedings, assignments for the benefit of creditors, insolvency,
bankruptcy, reorganization or other proceedings, against Seller that would
materially and adversely affect Seller’s ability to perform its obligations
under this Agreement.
In the event any of the foregoing conditions has not been satisfied by the
Closing Date, Purchaser shall have the right to terminate this Agreement by
written notice given to Seller on the Closing Date, whereupon Escrow Agent shall
promptly refund the Earnest Money to Purchaser and the parties shall have no
further rights, duties or obligations hereunder, other than those which are
expressly provided herein to survive the termination of this Agreement;
provided, however, that if any of the foregoing conditions has not been
satisfied due to a default by Purchaser or Seller hereunder, then Purchaser's
and Seller's respective rights, remedies and obligations shall instead be
determined in accordance with Article 6.
4.7    Conditions Precedent to Obligation of Seller. The obligation of Seller to
consummate the transaction hereunder shall be subject to the fulfillment on or
before the date of Closing of all of the following conditions, any or all of
which may be waived by Seller in its sole discretion:
(a)    Escrow Agent shall have received the Equity as adjusted pursuant to and
payable in the manner provided for in this Agreement.
(b)    Purchaser shall have delivered to Escrow Agent all of the items required
to be delivered to Seller by Purchaser or Purchaser's agents pursuant to the
terms of this Agreement, including but not limited to, those provided for in
Section 4.3.
(c)    All of the representations and warranties of Purchaser contained in this
Agreement shall be true and correct in all material respects as of the date of
Closing (with appropriate modifications permitted under this Agreement).
(d)    Purchaser shall have performed and observed, in all material respects,
all covenants and agreements of this Agreement to be performed and observed by
Purchaser as of the date of Closing.
(e)    All other conditions precedent to Seller's obligation to consummate the
transaction hereunder (if any) which are expressly set forth in this Agreement
shall have been satisfied on or before the date of Closing.
(f)    The Loan Assumption has been approved by Servicer and the Carveout
Release has been delivered to Escrow Agent.

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(g)    There shall exist no pending actions, suits, arbitrations, claims,
attachments, proceedings, assignments for the benefit of creditors, insolvency,
bankruptcy, reorganization or other proceedings, against Purchaser that would
materially and adversely affect Purchaser’s ability to perform its obligations
under this Agreement.
In the event any of the foregoing conditions has not been satisfied by the
Closing Date, Seller shall have the right to terminate this Agreement by written
notice given to Purchaser on the Closing Date, whereupon Escrow Agent shall
promptly refund the Earnest Money to Purchaser and the parties shall have no
further rights, duties or obligations hereunder, other than those which are
expressly provided herein to survive a termination of this Agreement; provided,
however, if any of the foregoing conditions has not been satisfied due to a
default by Purchaser or Seller hereunder, then Purchaser's and Seller's
respective rights, remedies and obligations shall instead be determined in
accordance with Article 6.
4.8    Seller's Tax Deferred Exchange. Seller may convey the Property as part of
a tax deferred exchange for the benefit of Seller pursuant to Section 1031 of
the Internal Revenue Code. With respect thereto, Seller may assign all of
Seller's contract rights and obligations hereunder to an exchange accommodation
titleholder or a qualified intermediary, as part of, and in furtherance of, such
tax deferred exchange. Purchaser agrees to reasonably cooperate in such exchange
for the benefit of Seller at no cost, expense or liability to Purchaser and
without reduction or alteration of the rights of Purchaser under this Agreement
and with respect to Seller; and Purchaser further agrees to execute any and all
documents (subject to the reasonable approval of Purchaser's legal counsel) as
are reasonably necessary in connection with such exchange at Seller's sole
expense provided that Purchaser shall not be required to undertake any liability
or obligation in so doing and provided that such exchange does not extend the
Closing Date. As part of such exchange, Seller shall convey the Property
directly to Purchaser and Purchaser shall not be obligated to acquire or convey
any other property as part of such exchange. Seller shall indemnify, hold
harmless and defend Purchaser from and against any and all claims, demands,
causes of action, liabilities, losses, costs, damages and expenses (including
reasonable attorneys' fees and expenses and court costs incurred in defending
any such claim or in enforcing this indemnity) that may be incurred by Purchaser
and arising out of Purchaser's participation in such exchange for the benefit of
Seller, which obligation shall survive the Closing. Notwithstanding the
foregoing, should Seller fail to effect a tax deferred exchange as contemplated
in this Section 4.8 for any reason, then the sale by Seller of the Property
shall be consummated in accordance with terms and conditions of this Agreement
just as though the provisions of this Section 4.8 had been omitted from this
Agreement, except that Purchaser shall be reimbursed and indemnified from
resulting costs and expenses as provided in this Section. Nothing contained in
this Section 4.8 shall release Seller of any of its obligations or liabilities
under this Agreement, whether accruing before, at or after Closing, nor shall
anything contained in this Section 4.8 impose any liability or obligation on
Purchaser with respect to the tax consequences of this transaction to Seller.
ARTICLE 5    
REPRESENTATIONS, WARRANTIES AND COVENANTS
5.1    Representations and Warranties of Seller. The Seller makes the following

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representations and warranties to Purchaser as of the Effective Date. Such
representations and warranties are subject to (i) those matters, if any,
disclosed in Seller's disclosure statement attached hereto as Schedule 5.1 and
made a part hereof by this reference (“Seller's Disclosure Statement”) and (ii)
the Permitted Exceptions.
(a)    Organization and Authority. The Seller has been duly organized and is
validly existing and in good standing under the laws of the State of Delaware
and is duly qualified to transact business and in good standing in the State
where the Property is located. Seller has the full right and authority to enter
into this Agreement and to transfer the Property pursuant hereto and to
consummate or cause to be consummated the transactions contemplated herein. The
person signing this Agreement on behalf of Seller is authorized to do so.
Neither the execution and delivery of this Agreement nor any other documents
executed and delivered, or to be executed and delivered, by Seller in connection
with the transactions described herein, will violate any provision of Seller's
organizational documents or of any agreements, regulations, or laws to or by
which Seller is bound. This Agreement has been, and each document to be executed
and delivered by Seller at Closing shall have been as of Closing, duly
authorized, executed and delivered by Seller, is a valid and binding obligation
of Seller and is enforceable against Seller in accordance with its terms subject
to (i) applicable bankruptcy, insolvency, reorganization, moratorium, and other
laws affecting the rights of creditors generally; and (ii) the exercise of
judicial discretion in accordance with general principles of equity.
(b)    Consents. Seller has obtained all consents and permissions (if any)
related to the transactions herein contemplated and required under any covenant,
agreement, encumbrance, law or regulation by which Seller or the Property is
bound.
(c)    Pending Actions. Except as set forth on Schedule 5.1, Seller has not
received written notice of any, and to Seller's knowledge there is no pending or
threatened (in writing) action, suit, arbitration, administrative or judicial
proceeding, or unsatisfied order or judgment against Seller which pertains
directly to Seller, the Property or the transaction contemplated by this
Agreement, which, if adversely determined, would have a material adverse effect
on Seller's ability to consummate the transaction contemplated herein or on the
use, operation or value of the Property.
(d)    Leases and Rent Roll. Seller is the lessor or landlord under the Leases.
The Rent Roll attached as Schedule 1.1(e) is, and each rent roll hereafter
delivered by Seller to Purchaser shall be the rent roll maintained by Seller and
relied on by Seller for internal administration and accounting purposes, and
Seller has no basis, to Seller’s actual knowledge, to believe that such rent
roll is not accurate in any material respect. Notwithstanding anything to the
contrary contained in this Agreement, Seller does not represent or warrant that
any particular Lease will be in force or effect at Closing or that the tenants
under the Leases will have performed their obligations thereunder. The
termination of any Lease prior to Closing by reason of the tenant's default or
for any other reason not constituting a default by Seller under this Agreement
shall not affect the obligations of Purchaser under this Agreement in any manner
or entitle Purchaser to an abatement of or credit against the Purchase Price or
give rise to any other claim on the part of Purchaser.
(e)    Condemnation; Zoning; Taxes. Seller has not received written notice of

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any, and to Seller’s knowledge there is no, pending or threatened (in writing),
(i) condemnation proceeding relating to the Property, or (ii) general plan, land
use or zoning action or proceeding, or general or special assessment action or
proceeding, with respect to the Property.
(f)    Insurance. Seller has not received prior to the Effective Date any
written notice from Seller's current insurance carrier of any defects or
inadequacies in or on the Property or any part or component thereof that would
materially and adversely affect the insurability of the Property or cause any
material increase in the premiums for insurance for the Property, that have not
been cured or repaired, or that any noninsurable condition exists in, on or
about the Property or any part thereof.
(g)    Environmental Matters. (i) Seller has received no written notice from any
governmental authority or any other person or entity asserting any violation of
Environmental Laws related to the Property which has not been cured or corrected
as of the Effective Date, and (ii) other than the environmental reports
previously delivered to Purchaser, Seller has not commissioned any study
relating to the presence or absence of Hazardous Materials on the Property.
Seller has never used the Property or any part thereof, and has never permitted
any person to use the Property or any part thereof, for the production,
processing, manufacture, generation, treatment, handling, storage or disposal of
Hazardous Substances in violation of Environmental Laws, other than in the
ordinary course of business. The term “Environmental Laws” includes without
limitation the Resource Conservation and Recovery Act and the Comprehensive
Environmental Response, Compensation, and Liability Act and other federal laws
governing the environment as in effect on the date of this Agreement together
with their implementing regulations as of the date of this Agreement applicable
to the Property, and all applicable state, regional, county, municipal and other
local laws, regulations and ordinances that are equivalent or similar to the
federal laws recited above or that purport to regulate hazardous or toxic
substances and materials. The term “Hazardous Materials” includes petroleum
(including crude oil or any fraction thereof) and any substance, material,
waste, pollutant or contaminant listed or defined as hazardous or toxic under
any Environmental Laws, in any case at levels or concentrations requiring
monitoring, reporting, remediation or removal in accordance with Environmental
Laws.
(h)    Service Contracts. There are no material service, supply, equipment
rental or similar agreements (each a “Service Contract” and collectively
“Service Contracts”) to which Seller is a party affecting the Property other
than those set forth in Schedule 5.7(b). True, correct and complete copies, in
all material respects, including any amendments or modifications thereto, have
been delivered by Seller to Purchaser. To Seller's knowledge, Seller is not in
default with respect to its obligations or liabilities under any of the Service
Contracts where the failure to cure such default would have a Material Adverse
Effect. “Material Adverse Effect” means, with respect to any fact or
circumstance, that such fact or circumstance would individually or in the
aggregate would have a material adverse effect on title to the Property or any
portion thereof, on Seller's ability to consummate the transaction contemplated
herein, or on the value or operation of the Property.
(i)    Employees. Seller has no employees which Purchaser shall be obligated to
employ following the Closing. In reliance on the representation provided by
Purchaser in Section 5.5(e), the transaction contemplated by this Agreement (and
any underlying obligations

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contemplated by this Agreement) does not and shall not constitute
a non-exempt prohibited transaction under Section 406(a) of the Employee
Retirement Income Security Act of 1974 (“ERISA”).
(j)    Operating Statements. The operating statements for the Property delivered
to Purchaser are the operating statements maintained by Seller and relied on by
Seller for internal administration and accounting purposes, and Seller has no
basis, to Seller’s actual knowledge, to believe that such operating statements
are not accurate in any material respect; provided, however, that Seller does
not and will not represent or warrant that Purchaser will be able to, or should
be able to, operate the Property according to and with similar results as shown
in such operating statements.
(k)    Personal Property. The Tangible Personal Property set forth on Schedule
1.1(d) is all owned by Seller free and clear of all liens or adverse claims
(other than the lien held by the Lender) and located at the Real Property.
Seller has the right to use the Tangible Personal Property as it has been using
the same and the right to convey its interest in such Tangible Personal Property
as provided hereunder for such continued use, free of any claims of third
parties claiming by, through or under Seller.
(l)    Intentionally Deleted.
(m)    Violations. Seller has not received any written notice from any
governmental authority that the Real Property is in violation of any applicable
building, earthquake, zoning, land use, environmental, antipollution, health,
fire, safety, access and accommodations for the physically handicapped,
subdivision, energy and resource conservation and similar laws, statutes, rules,
regulations and ordinances or any covenants, conditions and restrictions
applicable to the Real Property.
(n)    Seller. Seller is not “foreign person” as defined in Section 1445 of the
Internal Revenue Code of 1986, as amended, and the Income Tax Regulations
thereunder.
(o)    OFAC. Seller is not any of the following: (i) a person or entity that is
listed in the annex to, or is otherwise subject to the provisions of, Executive
Order No. 13224 on Terrorist Financing (effective September 24, 2001) (herein
called the “Executive Order”); (ii) a person or entity owned or controlled by,
or acting for or on behalf of any person or entity that is listed in the Annex
to, or is otherwise subject to the provisions of, the Executive Order; (iii) a
person or entity that is named as a “specifically designated national” or
“blocked person” on the most current list published by the U.S. Treasury
Department’s Office of Foreign Assets Control (herein called “OFAC”) at its
official website, http://www.treas.gov/offices/enforcement/ofac; (iv) a person
or entity that is otherwise the target of any economic sanctions program
currently administered by OFAC; or (v) a person or entity that is affiliated
with any person or entity identified in the foregoing clauses (i), (ii), (iii),
or (iv).
(p)    Condominium. Seller has not executed, and has no knowledge of, any
negative covenant restricting conversion of the Property to a condominium as an
inducement for a

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zoning or density variance or otherwise.
(q)    Deliveries. Those certain Seller third party reports listed on Schedule
3.1 and provided to Purchaser have been provided in good faith and with no basis
in Seller’s actual knowledge (without investigation or inquiry) to believe that
such information is not accurate as of the time prepared or is misleading in any
material respect.
5.2    Knowledge Defined. References to the “knowledge” of Seller shall refer
only to the actual knowledge, without investigation or inquiry, on the Effective
Date and on the Closing Date as specified in the Seller’s Closing Certificate,
of the Designated Representatives (as hereinafter defined) of Seller, and shall
not be construed, by imputation or otherwise, to refer to the knowledge of any
property manager or broker, or to any other officer, agent, manager,
representative or employee of Seller or any affiliate of Seller, or to impose
upon such Designated Representatives any duty to investigate the matter to which
such actual knowledge, or the absence thereof, pertains. As used herein, the
term “Designated Representatives” shall refer to the following persons:
(i) Thomas H. Flournoy and (ii) Nancy Martin, Regional Property Manager. In no
event shall Purchaser have any personal claim against the above-named
individuals as a result of the reference thereto in this Section 5.2
and Purchaser waives and releases all such claims which Purchaser now has or may
later acquire against them in connection with the transactions contemplated in
this Agreement.
5.3    Survival of Seller's Representations and Warranties. The representations
and warranties of Seller set forth in Section 5.1, as updated by Seller's
Closing Certificate, shall survive Closing for a period of nine (9) months after
Closing. Except with respect to fraudulent misrepresentation, in which event
Section 6.2 shall apply, no claim for a breach of any representation or warranty
of Seller shall be actionable or payable (a) if the breach in question results
from or is based on a condition, state of facts or other matter which was known
to Purchaser prior to Closing, and (b) unless the claims for all such breaches
collectively aggregate Twenty-Five Thousand and No/100 Dollars ($25,000.00) or
more, in which event the full amount of such claims shall be actionable, up to
but not exceeding the amount of the Cap (as defined below), and (c) unless
written notice containing a description of the specific nature of such breach
shall have been given by Purchaser to Seller prior to the expiration of said
nine (9) month period and an action shall have been commenced by Purchaser
against Seller within twelve (12) months after Closing. In the event of any
breach by Seller of its representations and warranties contained herein which
Purchaser first discovers after Closing and provides timely notice as aforesaid,
Seller shall indemnify and hold Purchaser harmless from and against any and all
loss, damage, cost or expense resulting therefrom up to but not exceeding the
Cap. Seller shall not be liable to Purchaser to the extent Purchaser's claim is
satisfied in full from any insurance policy, Designated Service Contract or
Lease. As used herein, the term “Cap” shall mean the total aggregate amount
equal to two percent (2%) of the Purchase Price. In no event shall Seller's
aggregate liability to Purchaser for any and all breaches of any representation
or warranty of Seller in this Agreement or Seller's Closing Certificate exceed
the amount of the Cap, and Purchaser hereby waives and disclaims any right to
damages or compensation for any and all such breaches in excess of the Cap.
Notwithstanding anything contained herein to the contrary, if Seller had actual
knowledge that any representation or warranty was untrue when made, and Seller
fraudulently made such representation or warranty (or intentionally and/or
fraudulently failed to disclose subsequently arising information that rendered

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such representation or warranty untrue), then the Cap shall be increased to the
amount of Purchaser’s actual direct third party costs and expenses incurred in
connection with this Agreement.
5.4    Covenants of Seller.    Seller hereby covenants with Purchaser, from the
Effective Date until the Closing or earlier termination of this Agreement, as
follows:
(a)    Operation of Property. Seller shall operate and maintain the Property in
a manner consistent in all material respects with the manner in which Seller has
operated and maintained the Property prior to the date hereof.
(b)    Execution of New Leases and Renewals. Seller shall use reasonable efforts
to negotiate new leases for unrented apartment units in the Improvements and/or
Lease renewals for rented apartment units in the Improvements and shall maintain
an advertising and marketing program for apartment units in the Improvements
consistent with Seller's past practices at the Property. Except for amendments
or leases entered into pursuant to renewal notices mailed prior to the execution
of this Agreement, unless Purchaser agrees otherwise in writing, any new leases
or renewals or modifications of existing leases for such apartment units entered
into by Seller after the Effective Date until the Closing or earlier termination
of this Agreement shall be on Seller's standard apartment lease form for the
Property, and shall be for terms of no less than three (3) months and no more
than fifteen (15) months or such longer or shorter periods as required under the
Loan Documents. In all cases, Seller shall retain the discretion to set rent
rates, concessions and other terms of occupancy, provided Seller shall only
enter into new leases or renewals in the ordinary course of business taking into
account Seller's then-current good faith evaluation of market conditions. Each
such new lease or renewal entered into by Seller shall constitute a “Lease” for
purposes of this Agreement.
(c)    Maintenance of Insurance. Seller shall keep the Improvements insured
against loss or damage (including rental loss) by fire and all risks covered by
the Seller's insurance that is currently in force, provided that Seller may make
commercially reasonable adjustments in Seller's insurance coverage for the
Property which are consistent with Seller's general insurance program for
Seller's other apartment properties as in effect from time to time.
(d)    Enforcement of Existing Leases. Seller shall perform the landlord's
material obligations to the tenants under the Leases and enforce the material
obligations of the tenants under the Leases, in each case in accordance with the
current management standards of Seller for its apartment properties.
(e)    Preparation of Vacant Units for Lease. Seller shall place apartment units
that are now vacant or that become vacant into rent-ready condition on or before
the Closing Date in accordance with Seller's current management standards for
its apartment properties as though no sale of the Property were contemplated or,
at Seller's option, provide Purchaser a credit at Closing equal to Seven Hundred
Fifty Dollars ($750.00) per unit for the apartment units that are not in
rent-ready condition on the Closing Date; provided, however, that with respect
to apartment units vacated during the three (3) day period ending on the Closing
Date, Seller shall have no obligation either to put such units into rent-ready
condition or to give Purchaser a credit for the cost of doing so. Not

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more than forty-eight (48) hours prior to the Closing Date, a representative of
Purchaser and a representative of Seller shall conduct an onsite walk-through of
the then unoccupied rental units on the Property to determine whether any of
such unoccupied rental units are in “rent ready” condition. 
(f)    Removal and Replacement of Tangible Personal Property.  Seller shall not
remove any Tangible Personal Property except as may be required for necessary
repair or replacement (which repair and replacement shall be of equal quality
and quantity as existed as of the time of the removal), or otherwise in
accordance with current inventory and management standards of Seller for its
apartment properties, provided that any appliances, leasing office furniture,
pool furniture, fitness center equipment, or other similar items of equipment so
removed by Seller are promptly replaced by Seller, at its cost, with items of
comparable value and utility.
(g)    Execution of New Contracts. Seller shall not, without Purchaser's prior
written consent in each instance (which consent may be withheld in Purchaser's
sole discretion), materially amend, extend, renew or terminate any of the
Service Contracts, or enter into any contract or agreement that will be an
obligation affecting the Property or binding on Purchaser after the Closing,
except that (i) Seller may enter into, amend or enforce (including enforcement
by termination) Service Contracts in the ordinary course of business as
reasonably necessary for the continued operation and maintenance of the
Property, provided any new Service Contracts are terminable without cause or
penalty on thirty (30) days notice and provided no amendments add any penalty or
notice for termination, and (ii) Seller may conduct leasing activity as provided
in Section 5.4(b) hereof.
(h)    Maintenance of Permits. Seller shall make commercially reasonable efforts
to maintain in existence all licenses, permits and approvals that are now in
existence with respect to, and are required for, the ownership, operation or
improvement of the Property, and are of a continuing nature.
(i)    Management Contracts. As of Closing the property management contract
pertaining to the Property shall have been terminated.
(j)    Loan. Seller shall make all regularly scheduled principal and interest
payments under the Loan Documents so as not to be in default under the Loan.
(k)    Intentionally Deleted.
(l)    Litigation. Seller shall promptly notify Purchaser in writing, following
Seller’s receipt of written notice from and after the Effective Date, of any
pending litigation, arbitration, condemnation or administrative hearing or
proceeding before any court or governmental agency concerning Seller or the
Property other than customary eviction proceedings that will be completed prior
to the Closing Date. Notwithstanding anything contained herein to the contrary,
Seller’s receipt of such notice shall not otherwise constitute a default by
Seller under this Agreement.
(m)    Compliance; Notices; Prohibited Acts. Seller shall use commercially
reasonable efforts within Seller’s means to comply in all material respects with
all covenants,

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conditions, restrictions, laws, statutes, rules, regulations and ordinances
applicable to the Property, and promptly give Purchaser copies of all written
notices received by Seller asserting any breach or default under the Leases or
the Service Contracts or any violation of any license, permit or other approval,
or any covenants, conditions, restrictions, laws, statutes, rules, regulations
or ordinances applicable to the Property. Seller shall promptly notify Purchaser
(i) if Seller initiates (or has initiated) a proceeding to contest or appeal the
amount of real property taxes or assessments levied against the Real Property or
the assessed value of the Real Property for real property tax purposes. Seller
shall not (i) initiate or otherwise take any action with respect to zoning or
any other governmental rules or regulations presently applicable to all or any
part of the Real Property; or (ii) fail to pay in a timely fashion all proper
and uncontested bills for labor or services for work performed for or on behalf
of Seller (at the request of Seller or Seller’s agents) with respect to the
Property.
(n)    Hazardous Materials. Seller shall promptly furnish to Purchaser copies of
all written communications received by Seller from any person (including
notices, complaints, claims or citations that any release or threatened release
of any Hazardous Materials or any violation of any Environmental Laws has
actually or allegedly occurred), or given by Seller to any person, concerning
any release or threatened release of any Hazardous Materials in, on or under the
Real Property or any violation of any Environmental Laws at the Real Property.
Notwithstanding anything contained herein to the contrary, Seller’s receipt of
such notice (or Seller’s giving of such notice) shall not otherwise constitute a
default by Seller under this Agreement.
5.5    Representations and Warranties of Purchaser. Purchaser hereby makes the
following representations and warranties to Seller as of the Effective Date:
(a)    Organization and Authority. Purchaser has been duly organized and is
validly existing as a corporation under the laws of the State of California.
Purchaser has the full right and authority to enter into this Agreement and to
purchase the Property pursuant hereto and to consummate or cause to be
consummated the transactions contemplated herein. The person signing this
Agreement on behalf of Purchaser is authorized to do so. Neither the execution
and delivery of this Agreement nor any other documents executed and delivered,
or to be executed and delivered, by Purchaser in connection with the
transactions described herein, will violate any provision of Purchaser's
organizational documents or of any agreements, regulations, or laws to or by
which Purchaser is bound. This Agreement has been duly authorized, executed and
delivered by Purchaser, is a valid and binding obligation of Purchaser and is
enforceable against Purchaser in accordance with its terms subject to
(i) applicable bankruptcy, insolvency, reorganization, moratorium, and other
laws affecting the rights of creditors generally; and (ii) the exercise of
judicial discretion in accordance with general principles of equity.
(b)    Consents. Purchaser has obtained all consents and permissions (if any)
related to the transactions herein contemplated and required under any covenant,
agreement, encumbrance, law or regulation by which Purchaser is bound.
(c)    Pending Actions. To Purchaser's knowledge, there is no action, suit,
arbitration, administrative or judicial administrative proceeding, or
unsatisfied order or judgment

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pending or threatened against Purchaser or the transaction contemplated by this
Agreement, which, if adversely determined, could individually or in the
aggregate have a material adverse effect on Purchaser's ability to consummate
the transaction contemplated herein.
(d)    Financial Status. Purchaser is solvent, has not made a general assignment
for the benefit of its creditors, and has not admitted in writing its inability
to pay its debts as they become due, nor has Purchaser filed, nor does it
contemplate the filing of, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or any other proceeding for the relief of
debtors in general, nor has any such proceeding been instituted by or against
Purchaser, nor is any such proceeding to Purchaser's knowledge threatened or
contemplated.
(e)    ERISA. Purchaser is not (i) (A) an “employee benefit plan” within the
meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”), (B) a “governmental plan” under Section 3(32) of ERISA,
(C) any plan described in Section 4975 of the Internal Revenue Code, or (D) an
entity whose underlying assets include “plan assets” by reason of the
application of the ERISA “plan assets” regulation (29 C.F.R. 2510.3-101), or
(ii) a "party in interest" under Section 3(14) of ERISA with respect to Seller.
(f)    OFAC. Purchaser is not any of the following: (i) a person or entity that
is listed in the annex to, or is otherwise subject to the provisions of the
Executive Order; (ii) a person or entity owned or controlled by, or acting for
or on behalf of any person or entity that is listed in the Annex to, or is
otherwise subject to the provisions of, the Executive Order; (iii) a person or
entity that is named as a “specifically designated national” or “blocked person”
on the most current list published by the OFAC at its official website,
http://www.treas.gov/offices/ enforcement/ofac; (iv) a person or entity that is
otherwise the target of any economic sanctions program currently administered by
OFAC; or (v) a person or entity that is affiliated with any person or entity
identified in the foregoing clauses (i), (ii), (iii), or (iv).
5.6    Survival of Purchaser's Representations and Warranties. The
representations and warranties of Purchaser set forth in Section 5.5 shall
survive Closing for a period of twelve (12) months after Closing.
5.7    Covenants of Purchaser.
(a)    Purchaser hereby covenants with Seller that, upon any termination of this
Agreement, Purchaser shall upon Seller's request, furnish to Seller copies of
any reports received by Purchaser in connection with any inspection of the
Property for the presence of Hazardous Materials (as defined in Section 5.1(g)
hereof), Mold or any Mold Condition (as defined below). EXCEPT FOR CLAIMS BASED
ON A BREACH BY SELLER OF THE REPRESENTATIONS AND WARRANTIES CONTAINED IN
SECTION 5.1(g), PURCHASER IRREVOCABLY WAIVES ANY CLAIM AGAINST SELLER ARISING
FROM THE PRESENCE OF HAZARDOUS MATERIALS OR MOLD OR ANY MOLD CONDITION ON THE
PROPERTY OR THE BREACH OF ENVIRONMENTAL LAWS WITH RESPECT TO THE PROPERTY. Upon
any termination of this Agreement, Purchaser shall also upon Seller's request,
furnish to Seller copies of any other reports received by Purchaser

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relating to any other inspections of the Property conducted on Purchaser's
behalf, if any. Any such reports furnished to Seller shall be furnished at
Seller's risk and without representation or warranty, express or implied, of any
kind whatsoever. “Mold” means mold, mildew, fungus or other potentially
dangerous organisms. “Mold Condition” means the presence or suspected presence
of Mold or any condition(s) that reasonably can be expected to give rise to or
indicate the presence of Mold, including observed or suspected instances of
water damage or intrusion, the presence of wet or damp wood, cellulose
wallboard, floor coverings or other materials, inappropriate climate control,
discoloration of walls, ceilings or floors, complaints of respiratory ailment or
eye irritation by residents, employees or any other occupants or invitees in the
Property, or any notice from a governmental agency of complaints regarding the
indoor air quality at the Property.
(b)    “Designated Service Contracts” means (i) those certain Service Contracts
which are assignable in accordance with their terms which Purchaser identifies
by written notice delivered to Seller on or before the Inspection Date as the
Service Contracts Purchaser elects Seller to assign to Purchaser at Closing,
(ii) those assignable Service Contracts regarding which Purchaser has failed to
deliver such written notice on or before the Inspection Date, and (iii) those
Service Contracts (the “Must Take Service Contracts”) attached hereto as
Schedule 5.7(b) which are assignable in accordance with their terms and which
may not be terminated without cause or penalty, with thirty (30) days (or less)
written notice. Purchaser hereby covenants with Seller that on or before the
Inspection Date, Purchaser shall deliver written notice to Seller instructing
which of the assignable Service Contracts Purchaser desires for Seller to assign
to Purchaser and which it does not. If Purchaser fails to timely deliver such
notice, Purchaser shall be deemed to have chosen to have all assignable Service
Contracts assigned to Purchaser, and all such Service Contracts shall be deemed
part of the “Designated Service Contracts.” At Closing, Seller will cause the
Service Contracts which Purchaser has elected not to have assigned to Purchaser
(other than the Must Take Service Contracts), by operation of the aforesaid
notice on or before the Inspection Date, to be terminated at Seller’s expense,
such termination to be effective within the time period provided for in the
applicable Service Contract (or if no such time period is provided, as promptly
as practicable after the Closing Date). The provisions of this Section 5.7(b)
shall survive Closing.
5.8    Special Provisions Concerning Condominium Conversion.
(a)    If Purchaser or any affiliate of Purchaser shall elect to conduct a
program of sales of condominium units within the Property, or otherwise to
convert all or any part of a Property to the condominium form of ownership at
anytime during the earlier to occur of (i) ten (10) year period following
Closing or (ii) the expiration of any statutory period under which the original
developer and/or contractor or its affiliates (to the extent any of the
foregoing are the Seller or an affiliate of Seller) would be liable under
applicable law for construction defects, such party shall provide Seller with a
copy of the proposed condominium documentation in advance of submission to any
governmental agency with jurisdiction over such sales program, or in advance of
any recordation of any such documentation in the real property records. The
proposed condominium documentation shall reflect a “Developer” or “Declarant”
(or similar party) other than Seller or any affiliate of Seller.
(b)    Purchaser agrees that, at all times from and after Closing, it will
indemnify,

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hold harmless and defend Seller and its affiliates, and their respective
officers and directors (herein collectively called the “Indemnified Parties”)
from and against any and all liabilities, damages, losses, costs and expenses
(including attorneys' fees and expenses), which any of the Indemnified Parties
may suffer, incur or be obligated to perform as a result of Purchaser's, or any
of its affiliates', and only Purchaser or one of its affiliates, converting the
form of ownership of all or any part of the Property to a condominium form of
ownership and/or selling residential condominium units within the Property
(hereinafter collectively called the “Condo Claims”). The foregoing indemnity
with respect to the Condo Claims shall be in effect regardless of whether the
Condo Claims result from actions of condominium unit owners, condominium unit
purchasers or condominium or property owners' association and regardless of
whether such Condo Claims relate to the construction of the Property or any
other matter, nature or thing, whatsoever. Purchaser, through selection of
counsel reasonably acceptable to Seller, shall have the sole and exclusive right
(absent an unwaiveable legal conflict of interest) to defend such claim in all
respects.
(c)    Prior to Closing, Purchaser shall not undertake or commence any sales or
marketing activities regarding the conversion of all or any part of the Property
to a condominium form of ownership or the marketing or sale of condominium units
therein, including, without limitation, the submittal or recordation of any
documentation regarding the conversion of the Property to a condominium form of
ownership or the marketing or sale of condominium units therein. Additionally,
and not by way of limitation, prior to Closing, neither Purchaser nor any
affiliate of Purchaser, nor any of their respective officers or directors shall
communicate any information about or concerning the future or potential
conversion of all or any part of the Property to a condominium form of
ownership, or the sale or marketing of any condominium units therein, to any
existing or potential tenant or occupant of the Property. Notwithstanding the
foregoing provisions or anything contained in this Agreement to the contrary,
Purchaser shall be permitted to inspect or review any or all records of any
federal, state or local governmental authority, and shall be permitted to make
such inquiries of and obtain such documentation and information related to the
Property from any federal, state or local governmental authorities to be able to
confirm the compliance and the condition of the Property with respect to all
governmental requirements and Purchaser's ability to convert the Property to
condominium use; provided, however, that this Section 5.8 does not permit the
disclosure of any information concerning the potential conversion of the
Property to a condominium form of ownership to any tenant or occupant of the
Property or potential purchasers of condominium units prior to Closing.
(d)    This Section 5.8 shall survive the termination, cancellation, rescission
or consummation of this Agreement.
ARTICLE 6    
DEFAULT
6.1    Default by Purchaser. If the sale of the Property as contemplated
hereunder is not consummated due to Purchaser's default hereunder, then Seller
shall be entitled, as its sole and exclusive remedy for such default, to
terminate this Agreement and receive the Earnest Money as liquidated damages for
the breach of this Agreement and not as a penalty, it being agreed between the
parties hereto that the actual damages to Seller in the event of such breach are
impractical to

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ascertain and the amount of the Earnest Money is a reasonable estimate thereof,
Seller hereby expressly waiving and relinquishing any and all other remedies at
law or in equity. Seller's right to receive the Earnest Money is intended not as
a penalty, but as full liquidated damages. The right to receive the Earnest
Money as full liquidated damages is Seller's sole and exclusive remedy in the
event of default hereunder by Purchaser, and Seller hereby waives and releases
any right to (and hereby covenants that it shall not) sue Purchaser: (a) for
specific performance of this Agreement, or (b) to recover any damages of any
nature or description other than or in excess of the Earnest Money. Purchaser
hereby waives and releases any right to (and hereby covenants that it shall not)
sue Seller or seek or claim a refund of the Earnest Money (or any part thereof)
on the grounds it is unreasonable in amount and exceeds Seller's actual damages
or that its retention by Seller constitutes a penalty and not agreed upon and
reasonable liquidated damages. This Section 6.1 is subject to Section 6.4
hereof.
6.2    Default by Seller. If the sale of the Property as contemplated hereunder
is not consummated due to Seller's default hereunder, then Purchaser shall be
entitled, as its sole remedy for such default, either (a) to receive the return
of the Earnest Money, which return shall operate to terminate this Agreement and
release Seller from any and all liability hereunder (other than the obligations
which expressly survive termination, including without limitation any obligation
of Seller under this Agreement to pay to Purchaser the Third Party Costs), or
(b) to enforce specific performance of Seller's obligations under this
Agreement. Purchaser expressly waives and releases its rights to seek damages in
the event of Seller's default hereunder; provided, however, that if Seller’s
default constitutes an Intentional Seller Default (as hereinafter defined) and
Purchaser makes the election in clause (a) above, then Purchaser shall also have
the right to sue Seller for money damages, in an amount equal to the lesser of
(i) two percent (2%) of the Purchase Price in the aggregate, or (ii) the amount
of all direct, third-party out-of-pocket costs and expenses actually incurred by
Purchaser in connection with this Agreement and/or the Loan Assumption, and the
inspection, acquisition and financing of said Property (the “Third Party
Costs”). In no event (except as provided in Section 5.3) shall Seller be liable
for consequential, speculative, remote or punitive damages, or any other damages
other than Third-Party Costs, and Purchaser hereby waives and releases any right
to seek or collect any such consequential, speculative, remote or punitive
damages, or any damages other than Third-Party Costs (such Third-Party Costs to
be limited in all cases as provided above). Purchaser shall be deemed to have
elected to terminate this Agreement and receive back the Earnest Money if
Purchaser fails to file suit for specific performance against Seller in a court
having jurisdiction in the county and state in which the Property is located, on
or before sixty (60) days following the last date upon which Closing could have
occurred. “Intentional Seller Default” means any one or more of the following:
(a) fraudulent misrepresentation, (b) criminal conduct (i.e. conduct that
constitutes a felony under applicable law), or (c) an intentional and deliberate
act of Seller taken on or after the Effective Date that results in Purchaser’s
inability to consummate the transaction contemplated in this Agreement for a
reason other than Purchaser’s default or the failure of any condition to Closing
to be satisfied. If the equitable remedy of specific performance is not
available due to an Intentional Seller Default, Purchaser may seek any other
right or remedy available at law or in equity; provided, however, that in no
event shall Seller’s liability exceed $500,000.00.
6.3    Notice of Default; Opportunity to Cure. Neither Seller nor Purchaser
shall be

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deemed to be in default hereunder until and unless such party has been given
written notice of its failure to comply with the terms hereof and thereafter
does not cure such failure within five (5) business days after receipt of such
notice; provided, however, that this Section 6.3 (i) shall not be applicable to
Purchaser's failure to deliver the Earnest Money or any portion thereof on the
date required hereunder or to a party's failure to make any deliveries required
of such party on the Closing Date and, accordingly, (ii) shall not have the
effect of extending the Closing Date or the due date of any Earnest Money
deposit hereunder.
6.4    Recoverable Damages. Notwithstanding Sections 6.1 and 6.2 hereof, in no
event shall the provisions of Sections 6.1 and 6.2 limit (i) either Purchaser's
or Seller's obligation to indemnify the other party, or the damages recoverable
by the indemnified party against the indemnifying party due to, a party's
express obligation to indemnify the other party in accordance with Section 3.1,
5.3, or 8.1(b) of this Agreement, or (ii)  either party's obligation to pay
costs, fees or expenses under Section 4.5 hereof, or the damages recoverable by
either party against the other party due to a party's failure to pay such costs.
In addition, if this Agreement terminates for any reason, other than a default
by Seller hereunder for which Purchaser has elected to pursue the remedy of
specific performance, and Purchaser or any affiliate of Purchaser asserts any
claim or right to the Property related to such termination that would otherwise
delay or prevent Seller from having clear, indefeasible, and marketable title to
the Property, then Seller shall have all rights and remedies available at law or
in equity with respect to such assertion by Purchaser and any actual loss,
damage or other consequence suffered by Seller as a result of such assertion;
provided, however, that in no event shall Purchaser be liable for consequential,
speculative, remote or punitive damages, and Seller hereby waives and releases
any right to seek or collect any such consequential, speculative, remote or
punitive damages.
ARTICLE 7    
RISK OF LOSS
7.1    Damage. In the event of “damage” (as hereinafter defined) to the Property
or any portion thereof, Seller shall promptly notify Purchaser thereof. In the
event of such major damage is “major” (as hereinafter defined), Purchaser may,
at its sole option, elect to proceed with the Closing (subject to the other
provisions of this Agreement) or may terminate this Agreement by delivering
written notice thereof to Seller within fifteen (15) days after Purchaser's
receipt of Seller's notice respecting the damage. If, within fifteen (15) days
of receipt of Seller's notice respecting such major damage, Purchaser delivers
written notice of termination of this Agreement to Seller, this Agreement shall
terminate, all Earnest Money shall be returned to Purchaser and, except for
obligations of the parties which survive termination of this Agreement, the
parties shall have no further obligations hereunder. If Purchaser does not
timely elect to terminate this Agreement, Purchaser shall have no further right
to terminate this Agreement as a result of the damage and in such event, Seller
shall assign to Purchaser at Closing all insurance proceeds or condemnation
awards paid or payable as a result of such damage and pay any insurance
deductible due under Seller's insurance policy(ies). If the damage is not major,
Seller shall assign to Purchaser at Closing all insurance proceeds or
condemnation awards paid or payable as a result of such damage and pay any
insurance deductible due under Seller's insurance policy(ies). In the event the
damage is not

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major and prior to Closing sufficient insurance proceeds are not received or
committed in writing by the insurance carrier sufficient to repair any damage,
Seller shall repair such damage by Closing or give Seller a credit at Closing in
an amount sufficient to pay for the cost unpaid as of Closing for repair of the
applicable damage (i.e. to restore the Property to substantially the same
condition as immediately before such casualty), such amount to be determined by
an architect or other appropriate professional selected by Seller and approved
by Purchaser, such approval not to be unreasonably withheld, conditioned or
delayed. Any assignment by Seller to Purchaser of insurance proceeds respecting
loss of rental income shall be limited to that portion of such proceeds
attributable to periods after Closing.
7.2    Definition of Major Damage. For purposes of Section 7.1:
(a)    “damage” means (i) physical damage to or destruction of all or part of
the Real Property by reason of fire, earthquake, tornado, flood or other
casualty occurring after the Effective Date or (ii) the physical taking of all
or part of the Real Property by condemnation or by conveyance in lieu of
condemnation occurring after the Effective Date; and
(b)    “major” damage refers to the following: (i) damage such that the cost of
repairing or restoring the premises in question to a condition substantially
similar to that of the premises in question prior to the event of damage would
in the opinion of an architect selected by Seller and reasonably approved by
Purchaser, be equal to or greater than Five Hundred Thousand and no/100 Dollars
($500,000.00) and (ii) any damage due to a condemnation or conveyance in lieu of
condemnation which materially impairs the current use or value of a Property or
access to such Property from public roads or the number or utility of parking
spaces. If Purchaser does not give notice to Seller of Purchaser's reasons for
disapproving an architect within five (5) business days after receipt of notice
of the proposed architect, then Purchaser shall be deemed to have approved the
architect selected by Seller.
7.3    Seller's Insurance. If necessary or appropriate for Purchaser to evaluate
its options or enforce its rights under this Article 7 following any damage to
the Property, Seller shall promptly provide to Purchaser on request a copy of
Seller's property insurance policies (or other applicable insurance policies)
with respect to the Property.
ARTICLE 8    
COMMISSIONS
8.1    Broker's Commission
(a)    The parties acknowledge that CB Richard Ellis, Inc. (“Broker”) has been
retained by and represents Seller as broker in connection with the subject
transaction, and is to be compensated for its services by Seller. Seller agrees
that Seller shall pay to Broker upon, but only upon, final consummation of the
transaction contemplated herein, a brokerage commission pursuant to a separate
written agreement between Seller and Broker.
(b)    Purchaser and Seller each hereby represents and warrants to the other
that it

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has not disclosed this Agreement or the subject matter hereof to, and has not
otherwise dealt with, any real estate broker, agent or salesman (other than
Broker) so as to create any legal right or claim in any such broker, agent or
salesman (other than Broker) for a real estate commission or similar fee or
compensation with respect to the negotiation and/or consummation of this
Agreement or the conveyance of the Property by Seller to Purchaser. Except as
provided in this Section 8.1 with respect to Broker, Purchaser and Seller shall
indemnify, hold harmless and defend each other from and against any and claims
and demands for a real estate brokerage commission or similar fee or
compensation arising out of any claimed dealings with the indemnifying party and
relating to this Agreement or the purchase and sale of the Property (including
reasonable attorneys' fees and expenses and court costs incurred in defending
any such claim or in enforcing this indemnity).
8.2    Survival. This Article 8 shall survive the rescission, cancellation,
termination or consummation of this Agreement.
ARTICLE 9    
DISCLAIMERS AND WAIVERS
9.1    No Reliance on Documents. EXCEPT FOR THE EXPRESS REPRESENTATIONS AND
WARRANTIES SET FORTH IN SECTION 5.1 HEREOF AND IN THE CLOSING DOCUMENTS, SELLER
MAKES NO REPRESENTATION OR WARRANTY AS TO THE TRUTH, ACCURACY OR COMPLETENESS OF
ANY MATERIALS, DATA OR INFORMATION DELIVERED BY SELLER TO PURCHASER IN
CONNECTION WITH THE TRANSACTION CONTEMPLATED HEREBY. PURCHASER ACKNOWLEDGES AND
AGREES THAT ALL MATERIALS, DATA AND INFORMATION DELIVERED BY SELLER TO PURCHASER
IN CONNECTION WITH THE TRANSACTION CONTEMPLATED HEREBY ARE PROVIDED TO PURCHASER
AS A CONVENIENCE ONLY AND THAT ANY RELIANCE ON OR USE OF SUCH MATERIALS, DATA OR
INFORMATION BY PURCHASER SHALL BE AT THE SOLE RISK OF PURCHASER, EXCEPT AS
OTHERWISE EXPRESSLY STATED HEREIN. WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, PURCHASER ACKNOWLEDGES AND AGREES THAT (A) ANY ENVIRONMENTAL OR OTHER
REPORT WITH RESPECT TO THE PROPERTY WHICH IS DELIVERED BY SELLER TO PURCHASER
SHALL BE FOR GENERAL INFORMATIONAL PURPOSES ONLY, (B) PURCHASER SHALL NOT HAVE
ANY RIGHT TO RELY ON ANY SUCH REPORT DELIVERED BY SELLER TO PURCHASER, BUT
RATHER WILL RELY ON ITS OWN INSPECTIONS AND INVESTIGATIONS OF THE PROPERTY AND
ANY REPORTS COMMISSIONED BY PURCHASER WITH RESPECT THERETO, AND (C) NEITHER
SELLER, ANY AFFILIATE OF SELLER NOR THE PERSON OR ENTITY WHICH PREPARED ANY SUCH
REPORT DELIVERED BY SELLER TO PURCHASER SHALL HAVE ANY LIABILITY TO PURCHASER
FOR ANY INACCURACY IN OR OMISSION FROM ANY SUCH REPORT.
9.2    Disclaimers. EXCEPT FOR THE EXPRESS REPRESENTATIONS AND WARRANTIES OF
SELLER SET FORTH IN SECTION 5.1 HEREOF AND IN THE CLOSING DOCUMENTS, PURCHASER
UNDERSTANDS AND AGREES THAT SELLER

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IS NOT MAKING AND HAS NOT AT ANY TIME MADE ANY WARRANTIES OR REPRESENTATIONS OF
ANY KIND OR CHARACTER, EXPRESSED OR IMPLIED, WITH RESPECT TO THE PROPERTY,
INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OR REPRESENTATIONS AS TO
HABITABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE (OTHER
THAN SELLER'S LIMITED OR SPECIAL WARRANTY OF TITLE TO BE SET FORTH IN THE DEED),
ZONING, TAX CONSEQUENCES, LATENT OR PATENT PHYSICAL OR ENVIRONMENTAL CONDITION,
UTILITIES, OPERATING HISTORY OR PROJECTIONS, VALUATION, GOVERNMENTAL APPROVALS,
THE COMPLIANCE OF THE PROPERTY WITH APPLICABLE LAWS, THE ABSENCE OR PRESENCE OF
HAZARDOUS MATERIALS OR OTHER TOXIC SUBSTANCES (INCLUDING WITHOUT LIMITATION MOLD
OR ANY MOLD CONDITION), COMPLIANCE WITH ENVIRONMENTAL LAWS OR ACCESS LAWS, THE
TRUTH, ACCURACY OR COMPLETENESS OF THE PROPERTY DOCUMENTS OR ANY OTHER
INFORMATION PROVIDED BY OR ON BEHALF OF SELLER TO PURCHASER, OR ANY OTHER MATTER
OR THING REGARDING THE PROPERTY. PURCHASER ACKNOWLEDGES AND AGREES THAT UPON
CLOSING SELLER SHALL SELL AND CONVEY TO PURCHASER AND PURCHASER SHALL ACCEPT THE
PROPERTY “AS IS, WHERE IS, WITH ALL FAULTS”, EXCEPT TO THE EXTENT EXPRESSLY
PROVIDED OTHERWISE IN THIS AGREEMENT. PURCHASER HAS NOT RELIED AND WILL NOT RELY
ON, AND SELLER IS NOT LIABLE FOR OR BOUND BY, ANY EXPRESSED OR IMPLIED
WARRANTIES, GUARANTIES, STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO
THE PROPERTY OR RELATING THERETO (INCLUDING SPECIFICALLY, WITHOUT LIMITATION,
PROPERTY INFORMATION PACKAGES DISTRIBUTED WITH RESPECT TO THE PROPERTY) MADE OR
FURNISHED BY SELLER, THE MANAGER OF THE PROPERTY, OR ANY REAL ESTATE BROKER OR
AGENT REPRESENTING OR PURPORTING TO REPRESENT SELLER, TO WHOMEVER MADE OR GIVEN,
DIRECTLY OR INDIRECTLY, ORALLY OR IN WRITING, UNLESS SPECIFICALLY SET FORTH IN
THIS AGREEMENT.
PURCHASER REPRESENTS TO SELLER THAT PURCHASER HAS CONDUCTED, OR WILL CONDUCT
PRIOR TO CLOSING, SUCH INVESTIGATIONS OF THE PROPERTY, INCLUDING BUT NOT LIMITED
TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS THEREOF, AS PURCHASER DEEMS
NECESSARY TO SATISFY ITSELF AS TO THE CONDITION OF THE PROPERTY AND THE
EXISTENCE OR NONEXISTENCE OR CURATIVE ACTION TO BE TAKEN WITH RESPECT TO ANY
HAZARDOUS MATERIALS OR TOXIC SUBSTANCES ON OR DISCHARGED FROM THE PROPERTY
(INCLUDING WITHOUT LIMITATION ANY MOLD OR MOLD CONDITION), OR WITH RESPECT TO
ACCESS LAWS, AND WILL RELY SOLELY UPON SAME AND NOT UPON ANY INFORMATION
PROVIDED BY OR ON BEHALF OF SELLER OR ITS AGENTS OR EMPLOYEES WITH RESPECT
THERETO, OTHER THAN SUCH REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER AS
ARE EXPRESSLY SET FORTH IN THIS AGREEMENT. UPON CLOSING, PURCHASER SHALL ASSUME
THE RISK THAT ADVERSE

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MATTERS, INCLUDING BUT NOT LIMITED TO, DESIGN, CONSTRUCTION DEFECTS, ADVERSE
PHYSICAL OR ENVIRONMENTAL CONDITIONS, OR NONCOMPLIANCE WITH ACCESS LAWS, MAY NOT
HAVE BEEN REVEALED BY PURCHASER'S INVESTIGATIONS, AND PURCHASER, UPON CLOSING,
SHALL BE DEEMED TO HAVE WAIVED, RELINQUISHED AND RELEASED SELLER (AND SELLER'S
AND ITS PARTNERS' RESPECTIVE OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES AND
AGENTS) FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS, CAUSES OF ACTION
(INCLUDING CAUSES OF ACTION IN TORT OR UNDER ANY ENVIRONMENTAL LAW), LOSSES,
DAMAGES, LIABILITIES, FINES, PENALTIES (WHETHER BASED ON STRICT LIABILITY OR
OTHERWISE), COSTS AND EXPENSES (INCLUDING ATTORNEYS' FEES AND COURT COSTS) OF
ANY AND EVERY KIND OR CHARACTER, KNOWN OR UNKNOWN, WHICH PURCHASER MIGHT HAVE
ASSERTED OR ALLEGED AGAINST SELLER (AND SELLER'S AND ITS PARTNERS' RESPECTIVE
OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES AND AGENTS) AT ANY TIME BY REASON
OF OR ARISING OUT OF ANY LATENT OR PATENT CONSTRUCTION DEFECTS OR PHYSICAL
CONDITIONS, VIOLATIONS OF ANY APPLICABLE LAWS (INCLUDING, WITHOUT LIMITATION,
ANY ENVIRONMENTAL LAWS OR ACCESS LAWS) AND ANY AND ALL OTHER ACTS, OMISSIONS,
EVENTS, CIRCUMSTANCES OR MATTERS REGARDING THE PROPERTY. THE FOREGOING SHALL NOT
BE INTERPRETED TO WAIVE ANY CLAIM OF PURCHASER WITH RESPECT TO ANY BREACH BY
SELLER OF ANY EXPRESS REPRESENTATIONS AND WARRANTIES MADE BY SELLER IN
SECTION 5.1 THAT EXPRESSLY SURVIVE CLOSING PURSUANT TO SECTION 5.3.
PURCHASER AGREES THAT SHOULD ANY INVESTIGATION, CLEANUP, REMEDIATION OR REMOVAL
OF HAZARDOUS SUBSTANCES OR OTHER ENVIRONMENTAL CONDITIONS (INCLUDING WITHOUT
LIMITATION ANY MOLD OR MOLD CONDITION) ON OR RELATED TO THE PROPERTY BE REQUIRED
AFTER THE DATE OF CLOSING, SELLER SHALL HAVE NO LIABILITY TO PURCHASER TO
PERFORM OR PAY FOR SUCH INVESTIGATION, CLEAN-UP, REMOVAL OR REMEDIATION, AND
PURCHASER EXPRESSLY WAIVES AND RELEASES ANY CLAIM TO THE CONTRARY. PURCHASER
FURTHER AGREES THAT SHOULD ANY INVESTIGATION OR CURATIVE ACTION ON OR RELATED TO
THE PROPERTY BE REQUIRED AFTER THE DATE OF CLOSING UNDER ANY ACCESS LAWS, SELLER
SHALL HAVE NO LIABILITY TO PURCHASER TO PERFORM OR PAY FOR SUCH INVESTIGATION OR
CURATIVE ACTION AND PURCHASER EXPRESSLY WAIVES AND RELEASES ANY CLAIM TO THE
CONTRARY. THE FOREGOING SHALL NOT BE INTERPRETED TO WAIVE ANY BREACH BY SELLER
OF ANY EXPRESS REPRESENTATIONS AND WARRANTIES MADE BY SELLER IN SECTION 5.1 THAT
EXPRESSLY SURVIVE CLOSING PURSUANT TO SECTION 5.3.
PURCHASER REPRESENTS AND WARRANTS THAT THE TERMS OF THE RELEASE CONTAINED HEREIN
AND ITS CONSEQUENCES HAVE BEEN

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COMPLETELY READ AND UNDERSTOOD BY PURCHASER, AND PURCHASER HAS HAD THE
OPPORTUNITY TO CONSULT WITH, AND HAS CONSULTED WITH, LEGAL COUNSEL OF
PURCHASER'S CHOICE WITH REGARD TO THE TERMS OF THIS RELEASE. PURCHASER
ACKNOWLEDGES AND WARRANTS THAT PURCHASER'S EXECUTION OF THIS RELEASE IS FREE AND
VOLUNTARY.
9.3    Certain Definitions. The term “Access Laws” means the Americans With
Disabilities Act, the Fair Housing Act, the Rehabilitation Act and other federal
laws and all applicable state, regional, county, municipal and other local laws,
regulations and ordinances governing access to handicapped or disabled persons
or the construction or design of residential dwelling units, places of public
accommodation, or common areas which are at or on the Property.
9.4    Effect and Survival of Disclaimers. Seller and Purchaser acknowledge that
the provisions of this ARTICLE 9 are an integral part of the transactions
contemplated in this Agreement and a material inducement to Seller to enter into
this Agreement and that Seller would not enter into this Agreement but for the
provisions of this ARTICLE 9. Seller and Purchaser agree that the provisions of
this ARTICLE 9 shall survive Closing or any termination of this Agreement.
ARTICLE 10    
ESCROW AGENT
10.1    Investment of Earnest Money. Escrow Agent shall invest the Earnest Money
pursuant to Purchaser's directions, which may be in an interest bearing account
at a commercial bank whose deposits are insured by the Federal Deposit Insurance
Corporation. Escrow Agent shall notify Seller, no later than one (1) business
day after Escrow Agent's receipt thereof, that Escrow Agent has received the
Earnest Money in immediately available funds, and is holding the same in
accordance with the terms of this Agreement. However, Escrow Agent shall invest
the Earnest Money only in such accounts as will allow Escrow Agent to disburse
the Earnest Money upon no more than one (1) business day's notice. Escrow Agent
not commingle the Earnest Money with any funds of Escrow Agent or any other
person or entity without the prior written consent of Purchaser. All interest
earned on the Earnest Money, if any, shall be included within the meaning of the
term “Earnest Money” in this Agreement.
10.2    Intentionally Omitted.
10.3    Payment on Demand. Upon receipt of any written certification from Seller
or Purchaser claiming the Earnest Money pursuant to the provisions of this
Agreement, Escrow Agent shall promptly forward a copy thereof to the other such
party (i.e., Purchaser or Seller, whichever did not claim the Earnest Money
pursuant to such notice) and, unless such other party within five (5) business
days thereafter notifies Escrow Agent of any objection to such requested
disbursement of the Earnest Money in which case Escrow Agent shall retain the
Earnest Money subject to Section 10.5 below, Escrow Agent shall disburse the
Earnest Money to the party demanding the same and shall thereupon be released
and discharged from any further duty or obligation hereunder.

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10.4    Exculpation of Escrow Agent. It is agreed that the duties of Escrow
Agent are herein specifically provided and are purely ministerial in nature, and
that Escrow Agent shall incur no liability whatsoever except for its misconduct
or negligence, so long as Escrow Agent is acting in good faith. Seller and
Purchaser do each hereby release Escrow Agent from any liability for any error
of judgment or for any act done or omitted to be done by Escrow Agent in the
good faith performance of its duties hereunder and do each hereby indemnify
Escrow Agent against, and agree to hold, save, and defend Escrow Agent harmless
from, any costs, liabilities, and expenses incurred by Escrow Agent in serving
as Escrow Agent hereunder and in faithfully discharging its duties and
obligations hereunder.
10.5    Stakeholder. Escrow Agent is acting as a stakeholder only with respect
to the Earnest Money. If there is any dispute as to whether Escrow Agent is
obligated to deliver the Earnest Money or as to whom the Earnest Money is to be
delivered, Escrow Agent may refuse to make any delivery and may continue to hold
the Earnest Money until receipt by Escrow Agent of an authorization in writing,
signed by Seller and Purchaser, directing the disposition of the Earnest Money,
or, in the absence of such written authorization, until final determination of
the rights of the parties in an appropriate judicial proceeding. If such written
authorization is not given, or a proceeding for such determination is not begun,
within thirty (30) days of notice to Escrow Agent of such dispute, Escrow Agent
may bring an appropriate action or proceeding for leave to deposit the Earnest
Money in a court of competent jurisdiction located in the Atlanta metropolitan
area pending such determination. Escrow Agent shall be reimbursed for all costs
and expenses of such action or proceeding, including, without limitation,
reasonable attorneys' fees and disbursements, by the party determined not to be
entitled to the Earnest Money. Upon making delivery of the Earnest Money in any
of the manners herein provided, Escrow Agent shall have no further liability or
obligation hereunder.
10.6    Interest. All interest and other income earned on the Earnest Money
deposited with Escrow Agent hereunder shall be reported for income tax purposes
as earnings of Purchaser. Purchaser's taxpayer identification number is
90-0152520.
10.7    Execution by Escrow Agent. Escrow Agent has executed this Agreement
solely for the purpose of acknowledging and agreeing to the provisions of this
ARTICLE 10. Escrow Agent's consent to any modification or amendment of this
Agreement other than this ARTICLE 10 shall not be required.
ARTICLE 11    
MISCELLANEOUS
11.1    Audit Requirements. Seller shall provide to Purchaser (at Purchaser’s
expense) copies of, or shall provide Purchaser reasonable access to, such
factual information as may be reasonably requested by Purchaser, and in the
possession or control of Seller, or its property manager or accountants, to
enable Purchaser's auditor to conduct an audit, in accordance with Rule 3-14 of
Securities and Exchange Commission Regulation S-X, of the income statements of
the Property for the year to date of the year in which Closing occurs plus one
(1) prior calendar year (provided,

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however, such audit shall not include an audit of management fees). Purchaser
shall be responsible for all out-of-pocket costs associated with this audit.
Seller shall reasonably cooperate (at no cost to Seller) with Purchaser’s
auditor in the conduct of such audit. In addition, Seller agrees to provide to
Purchaser or any affiliate of Purchaser, if requested by such auditor,
historical financial statements for the Property, including (without limitation)
income and balance sheet data for the Property, whether required before or after
Closing. Without limiting the foregoing, (i) Purchaser or its designated
independent or other auditor may audit Seller’s operating statements of the
Property, at Purchaser’s expense, and Seller shall provide such documentation as
Purchaser or its auditor may reasonably request in order to complete such audit,
and (ii) Seller shall furnish to Purchaser such financial and other information
as may be reasonably required by Purchaser or any affiliate of Purchaser to make
any required filings with the Securities and Exchange Commission or other
governmental authority. Seller shall maintain its records for use under this
Section 11.1 for a period of not less than one (1) year after the Closing Date.
The provisions of this Section shall survive Closing. Notwithstanding anything
contained herein to the contrary, Seller shall not be liable to Purchaser based
on the results of any audit, or the lack of any information required to conduct
such audit, unless the Purchaser’s inability to obtain such information is
caused by Seller’s breach of its obligations under this Section 11.1.
11.2    Intentionally Deleted
11.2    Assignment. Purchaser may not assign its rights under this Agreement
other than to a Permitted Affiliate without first obtaining Seller's written
approval, which approval may be given or withheld in Seller's sole discretion.
Any transfer, directly or indirectly, of any stock, partnership interest or
other ownership interest in Purchaser in excess of 49% without Seller's written
approval, which approval shall not be unreasonably withheld, delayed or
conditioned, shall constitute a default by Purchaser under this Agreement,
provided, however, (i) Purchaser may assign this Agreement at or prior to
Closing to a Permitted Affiliate without Seller's consent, and (ii) Seller may
assign its rights under this Agreement to a reputable exchange accommodation to
facilitate a tax deferred exchange pursuant to Section 4.8 hereof. For purposes
hereof, the term “Permitted Affiliate” means an entity that controls, is
controlled or managed by, or is under common control with Purchaser and/or those
persons controlling and/or managing Purchaser and is solvent at the time of
assignment and at the time of Closing, is not rendered insolvent by such
assignment, and has sufficient assets to consummate the transaction contemplated
herein. No transfer or assignment by Purchaser shall release or relieve
Purchaser of its obligations hereunder.
11.3    Notices. Any notice, request or other communication (a “notice”)
required or permitted to be given hereunder shall be in writing and shall be
delivered by hand or overnight courier (such as United Parcel Service or Federal
Express), sent by facsimile (provided a copy of such notice is deposited with an
overnight courier for next business day delivery) or mailed by United States
registered or certified mail, return receipt requested, postage prepaid and
addressed to each party at its address as set forth below. Any such notice shall
be considered given on the date of such hand or courier delivery, confirmed
facsimile transmission if received on a business day (provided a copy of such
notice is deposited with an overnight courier for next business day delivery),
deposit with such overnight courier for next business day delivery, or deposit
in the United

37

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States mail, but the time period (if any is provided herein) in which to respond
to such notice shall commence on the date of hand or overnight courier delivery
or on the date received following deposit in the United States mail as provided
above. Rejection or other refusal to accept or inability to deliver because of
changed address of which no notice was given shall be deemed to be receipt of
the notice. By giving at least five (5) days' prior written notice thereof, any
party may from time to time and at any time change its mailing address
hereunder. Any notice of any party may be given by such party's counsel.
The parties' respective addresses for notice purposes are as follows. Telephone
numbers are given for convenience of reference only. Notice by telephone shall
not be effective.
If to Seller:

Flournoy Development Company, LLC
900 Brookstone Centre Parkway
Columbus, GA 31904
Attention: Thomas H. Flournoy
Telephone: 706/243-9406
Fax No.: 706/596-2492
Email:    tom.flournoy@flournoydev.com

with a copy to:

Burr & Forman LLP
171 17th Street NW
Suite 1100
Atlanta, GA 30363
Attention: Rick Fishman, Esq.
Telephone: 404/685-4307
Fax No.: 404/817-3244
Email:    rfishman@burr.com

If to Purchaser:

 
Steadfast Asset Holdings, Inc.
18100 Von Karman, Suite 500
Irvine, California 92612
Attention: Ana Marie del Rio, Esq.
Fax No.: 949/852-0143
Telephone: 949/852-0700
Email: adelrio@SteadfastCompanies.com

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with a copy to:

 
Katten Muchin Rosenman LLP
2900 K Street, NW
North Tower – Suite 200
Washington, DC 20007
Attention: Virginia A. Davis, Esq.
Fax No.: 202/339-8244
Telephone: 202/625-3602
Email: virginia.davis@kattenlaw.com

If to Escrow Agent:

First American Title Insurance Company
Six Concourse Parkway
Suite 2000
Atlanta, GA 30328
Attention: Deborah Goodman
Telephone No. 770/390-6510
Facsimile No. 404/303-1235
Email: dgoodman@firstam.com

11.4    Modifications. This Agreement cannot be changed orally, and no agreement
shall be effective to waive, change, modify or discharge it in whole or in part
unless such agreement is in writing and is signed by the parties against whom
enforcement of any waiver, change, modification or discharge is sought.
Signatures inscribed on the signature pages of this Agreement or any formal
amendment which are transmitted by telecopy or email transmission (e.g., PDF
files) shall be valid and effective to bind the party so signing.  Each party
agrees to promptly deliver to the other party an executed original of this
Agreement or any such formal amendment with its actual signature, but a failure
to do so shall not affect the enforceability of this Agreement or any such
formal amendment, it being expressly agreed that each party to this Agreement or
any formal amendment shall be bound by its own telecopied or emailed signature
and shall accept the telecopied or emailed signature of the other party to this
Agreement or any formal amendment.
11.5    Calculation of Time Periods. Unless otherwise specified, in computing
any period of time described in this Agreement, the day of the act or event
after which the designated period of time begins to run is not to be included
and the last day of the period so computed is to be included, unless such last
day is a Saturday, Sunday or legal holiday under the laws of the State in which
the Property is located, in which event the period shall run until the end of
the next day which is neither a Saturday, Sunday or legal holiday. The final day
of any such period shall be deemed to end at 5:00 p.m., Eastern time.
11.6    Successors and Assigns. Subject to Section 11.3 hereof, the terms and
provisions of this Agreement are to apply to and bind the permitted successors
and assigns of the parties hereto.

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11.7    Entire Agreement. This Agreement, including the Schedules, contain the
entire agreement between the parties pertaining to the subject matter hereof and
fully supersede all prior written or oral agreements and understandings between
the parties pertaining to such subject matter.
11.8    Further Assurances. Each party agrees that it will without further
consideration execute and deliver such other documents and take such other
action, whether prior or subsequent to Closing, as may be reasonably requested
by the other party to consummate more effectively the purposes or subject matter
of this Agreement. Without limiting the generality of the foregoing, Purchaser
shall, if reasonably requested by Seller, execute acknowledgments of receipt
with respect to any materials delivered by Seller to Purchaser with respect to
the Property. The provisions of this Section 11.9 shall survive Closing.
11.9    Counterparts. This Agreement may be executed in identical counterparts,
and all such executed counterparts shall constitute the same agreement. It shall
be necessary to account for only one such counterpart in proving this Agreement.
11.10    Severability. If any provision of this Agreement is determined by a
court of competent jurisdiction to be invalid or unenforceable, the remainder of
this Agreement shall nonetheless remain in full force and effect.
11.11    Applicable Law. This Agreement is performable in the state in which the
Property is located and shall in all respects be governed by, and construed in
accordance with, the substantive federal laws of the United States and the laws
of such state. Seller and Purchaser hereby irrevocably submit to the
jurisdiction of any state or federal court sitting in the state and judicial
district in which the Property is located in any action or proceeding arising
out of or relating to this Agreement and hereby irrevocably agree that all
claims in respect of such action or proceeding shall be heard and determined in
a state or federal court sitting in the state and judicial district in which the
Property is located. Purchaser and Seller agree that the provisions of this
Section 11.12 shall survive the Closing of the transaction contemplated by this
Agreement.
11.12    No Third Party Beneficiary. The provisions of this Agreement and of the
documents to be executed and delivered at Closing are and will be for the
benefit of Seller and Purchaser only and are not for the benefit of any third
party, and accordingly, no third party shall have the right to enforce the
provisions of this Agreement or of the documents to be executed and delivered at
Closing.
11.13    Employees. Seller shall be solely responsible for the salaries and
benefits, if any, payable to Seller's employees at the Property for the period
through the Closing, in accordance with and subject to the terms and conditions
of such employment, even if such employees are employed by or on behalf of
Purchaser following the Closing. With respect to any employees employed by or on
behalf of Purchaser following the Closing, Purchaser shall be solely responsible
for all salaries and benefits, if any, payable to such employees for the period
from and after the Closing in accordance with and subject to the terms and
conditions of such employment, even if such employees were employed by Seller
prior to the Closing, provided, however, that Purchaser shall have no obligation

40

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to offer employment to or to employ any employee of the Property following
Closing. Neither Purchaser nor Seller shall have any obligation for salaries,
benefits or other employment obligations to any such employee with respect to
the period such employee is or was employed by the other party. This Section
11.14 shall survive the Closing.
11.14    Seller's Access to Records after Closing. Purchaser shall reasonably
cooperate with Seller at Seller's sole cost for a period of one (1) year after
Closing to make available Purchaser's employees and Property records, as Seller
may reasonably request, in case of Seller's need in response to any legal
requirement, tax audit, tax return preparation, securities law filing, or
litigation threatened or brought against Seller, by allowing Seller and its
agents or representatives access, upon reasonable advance notice (which notice
shall identify the nature of the information sought by Seller), at all
reasonable times to examine and make copies of any and all instruments, files
and records which predate the Closing; provided, however, that nothing contained
in this Section shall require Purchaser to retain any files or records for any
particular period of time. This Section 11.15 shall survive Closing.
11.15    Schedules. The following schedules attached hereto shall be deemed to
be an integral part of this Agreement:
Schedule 1.1 (a)    -    Legal Description of the Land
Schedule 1.1(d)    -    Inventory of Tangible Personal Property
Schedule 1.1(e)    -    Rent Roll
Schedule 1.5        -    Loan Documents
Schedule 1.6(a)    -    Earnest Money Wiring Instructions
Schedule 2.4(d)    -    Permitted Exceptions
Schedule 3.1        -    Additional Diligence Deliveries
Schedule 4.2(a)    -    Special Warranty Deed
Schedule 4.2(b)    -    Bill of Sale and Assignment
Schedule 4.2(c)    -    Tenant Notice
Schedule 4.2(d)    -    Seller's Closing Certificate
Schedule 5.1        -    Seller's Disclosure Statement
Schedule 5.7(b)    -    Schedule of Must Take Service Contracts

11.16    Captions. The section headings appearing in this Agreement are for
convenience of reference only and are not intended, to any extent and for any
purpose, to limit or define the text of any section or any subsection hereof.
11.17    Construction. The parties acknowledge that the parties and their
counsel have reviewed and revised this Agreement and that the normal rule of
construction to the effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this Agreement or
any schedules or amendments hereto.
11.18    Termination of Agreement. It is understood and agreed that if either
Purchaser or Seller terminates this Agreement pursuant to a right of termination
granted hereunder, such termination shall operate to relieve Seller and
Purchaser from all obligations under this Agreement,

41

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except for such obligations as are specifically stated herein to survive the
termination of this Agreement.
11.19    Survival. The provisions of the following Sections of this Agreement
shall survive Closing and shall not be merged into the execution and delivery of
the Deed: 3.1(c); 4.2(c); 4.4; 4.5, 4.8, 5.1; 5.2; 5.3; 5.5; 5.6; 5.7; 5.8;
Article 8; Article 9; 11.9; 11.12; 11.14; 11.15; those additional provisions of
Article 11 which govern the administration, interpretation or enforcement of
this Agreement; and any other provisions contained herein that by their terms
survive the Closing (the “Obligations Surviving Closing”). Except for the
Obligations Surviving Closing, all representations, warranties, covenants and
agreements contained in this Agreement shall be merged into the instruments and
documents executed and delivered at Closing. The Obligations Surviving Closing
shall survive the Closing; provided, however, that the representations and
warranties of Seller contained in Section 5.1, as updated by Seller's Closing
Certificate, and the representations and warranties of Purchaser contained in
Section 5.5, shall survive for the period, and are subject to the terms, set
forth in Sections 5.3 and 5.6 respectively.
11.20    Time of Essence. Time is of the essence with respect to this Agreement.
11.21    Covenant Not to Record. Purchaser shall not record this Agreement or
any memorandum or other evidence thereof. Any such recording shall constitute a
material default hereunder on the part of Purchaser.
11.22    Limitation of Seller's Liability. Purchaser shall have no recourse
against any of the past, present or future, direct or indirect, shareholders,
partners, members, managers, principals, directors, officers, agents,
incorporators, affiliates or representatives of Seller or its general partner or
of any of the assets or property of any of the foregoing for the payment or
collection of any amount, judgment, judicial process, arbitral award, fee or
cost or for any other obligation or claim arising out of or based upon this
Agreement and requiring the payment of money by Seller. This Section 11.23 shall
survive the Closing.
11.23    JURY WAIVER. IN ANY LAWSUIT OR OTHER PROCEEDING INITIATED BY SELLER OR
PURCHASER UNDER OR WITH RESPECT TO THIS AGREEMENT, SELLER AND PURCHASER EACH
WAIVE ANY RIGHT IT MAY HAVE TO TRIAL BY JURY.
11.24    Attorneys' Fees. In any action to enforce or interpret the provisions
of this Agreement, the party against whom any final judgment is entered agrees
to pay the prevailing party all reasonable costs, charges, and expenses,
including reasonable attorneys’ fees actually incurred in connection therewith.
11.25    Waiver; Extension. No waiver of any breach of any agreement or
provision contained herein shall be deemed a waiver of any preceding or
succeeding breach of any other agreement or provision herein contained. No
extension of time for the performance of any obligation or act shall be deemed
an extension of time for the performance of any other obligation or act.
[Signatures on following pages.]

42

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the Effective Date.
SELLER:

ESTANCIA TULSA, LLC, a Delaware limited liability company

By:
Flournoy Development Company, LLC,
a Georgia limited liability company,
its Manager

By:
/s/ Thomas H. Flournoy
 
Thomas H. Flournoy, its President
 
 

[SIGNATURES CONTINUED ON THE FOLLOWING PAGES]
This is a signature page to, and may be attached to a master counterpart of, the
Purchase and Sale Agreement between ESTANCIA TULSA, LLC, as Seller, and
STEADFAST ASSET HOLDINGS, INC., as Purchaser, with respect to Estancia.
First American Title Insurance Company, as Escrow Agent is a party to such
Purchase and Sale Agreement for the limited purposes set forth therein.

43

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PURCHASER:
STEADFAST ASSET HOLDINGS, INC.,
a California corporation

By:
/s/ Ana Marie del Rio
 
Ana Marie del Rio
 
Secretary

[SIGNATURES CONTINUED ON THE FOLLOWING PAGES]
This is a signature page to, and may be attached to a master counterpart of, the
Purchase and Sale Agreement between ESTANCIA TULSA, LLC, as Seller, and
STEADFAST ASSET HOLDINGS, INC., as Purchaser, with respect to Estancia.
First American Title Insurance Company, as Escrow Agent is a party to such
Purchase and Sale Agreement for the limited purposes set forth therein.

44

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Escrow Agent has executed this Agreement for the limited purposes set forth
herein.
ESCROW AGENT:

FIRST AMERICAN TITLE INSURANCE COMPANY,
a California corporation

By:
/s/ Deborah Goodman
 
Deborah Goodman
 
V.P.

This is a signature page to, and may be attached to a master counterpart of, the
Purchase and Sale Agreement between ESTANCIA TULSA, LLC, as Seller, and
STEADFAST ASSET HOLDINGS, INC., as Purchaser, with respect to Estancia.
First American Title Insurance Company, as Escrow Agent is a party to such
Purchase and Sale Agreement for the limited purposes set forth therein.

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Schedule 1.1(a)
LEGAL DESCRIPTION OF THE LAND

Lot One (1), Block One (1), Estancia, a Subdivision in the City of Tulsa, Tulsa
County, State of Oklahoma, according to the recorded Plat No. 5938.

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Schedule 1.1(d)

INVENTORY OF TANGIBLE PERSONAL PROPERTY
[SEE ATTACHED PAGES]

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Schedule 1.1(e)
RENT ROLL
[INTENTIONALLY OMITTED]

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Schedule 1.5
LOAN DOCUMENTS
Loan Originator: CBRE Melody & Company
Loan Purchaser: Federal Home Loan Mortgage Corporation
(“Freddie Mac”)
Loan Servicer: GEMSA Loan Services

$20,500,000.00 loan to
Estancia Tulsa, LLC, (the "Borrower")
1.    Warehouse Documents (Forms 987 and 996)    
2.    Note (State - designated Multifamily Note)
3.    Security Instrument
4.    Assignment of Security Instrument
5.    Financing Statements
6.    Assignments of Financing Statements
7.    Repair Agreement/Repair Escrow Agreement
8.    Replacement Reserve Agreement
9.    Assignment of Loan Documents
10.    Guaranty
11.    Agreement to Amend or Comply
12.    Information of Escrow Accounts held and Forms 1057 and 1058

Tax Escrow Balance as of January 18, 2012 - $46,837.60

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Schedule 1.6(a)
EARNEST MONEY WIRING INSTRUCTIONS

[estanciapsafinalrcvdf_image1.gif]
First American Title Insurance Company
National Commercial Services
6 Concourse Parkway, Suite 2000
Atlanta, GA 30328

www.firstam.com*NYSE:FAF

WIRING INSTRUCTIONS

FIRST AMERICAN TRUST
5 FIRST AMERICAN WAY
SANTA ANA, CA 92707

ABA #122241255

To Credit the Account of:

FIRST AMERICAN TITLE INSURANCE COMPANY

ACCOUNT NO. 3015520000

Ref: File No. NCS 450406-6

Property Reference: Estancia Tulsa
ATTN: Deborah Goodman

Please include our file number on all wires

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Schedule 2.4(d)
PERMITTED EXCEPTIONS
1.
Ad valorem taxes for 2011, amount of which is not ascertainable, due or payable.

2.
All interest in and to all oil, gas, coal and other minerals and all rights
pertaining thereto.

3.
Restrictive covenants filed December 22, 2005, recorded as Document No.
2005151110, as amended by the Affidavit of Correction filed September 20, 2007,
recorded as Document No. 2007106414, all of which do not provide for a
forfeiture or reversion of title upon violation thereof. 

4.
All items affecting subject Lot as shown on the recorded Plat No. 5938 for
Estancia are made a part hereof.

5.
Statutory right-of-way along all section lines.

6.
Rights of tenants in possession.

7.
Water Easement in favor of the City of Tulsa recorded in Book 4595, Page 1309. 

8.
Easement in favor of Public Service Company of Oklahoma recorded as Document No.
2005122171. 

9.
Easement in favor of Valor Telecommunications of Texas, LP recorded as Document
No. 2006005266. 

10.
Terms, conditions and provisions of the Access and Temporary Construction
Easement Agreement entered by and between South Mingo Partnership, William E.
Manley & Betty J. Manley and Estancia Tulsa, LLC recorded as Document No.
2005092142.   

11.
Grant of Easement and Memorandum of Agreement entered by and between Estancia
Tulsa, LLC and Coxcom, Inc. recorded as Document No. 2007038033.   

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Schedule 3.1

Additional Diligence Deliveries

 
CONSTRUCTION / REHABILITATION
1
Plans & Specifications
2
a. To the extent in Seller’s possession, most current civil, landscape,
architectural, structural mechanical, electrical & fire protection plans
3
Construction contracts
4
Current capital improvements and schedule over past 3 years
5
Warranties in effect (construction, roof, mechanical equipment, etc.)
6
Copies of all Licenses and Permits, including Business License
7
Certificate(s) of Occupancy
8
[Intentionally Deleted]
9
Copies of all Governmental correspondence or notices in Seller’s possession
pertaining to the property including but not limited to Building Code, Health
Code, Zoning and Fire Code
10
Maintenance Records/work orders (for past 12 months)
 
Other
 
FINANCIAL
1
Monthly Operating Statements (YTD and 3-year historical)
2
Current Year Operating Budget
3
Agreements, bonds affecting property (if any) [N/A]
4
City or County Development Agreements (if any) [N/A]
5
Year-End Financial Statements, Audited if available (past 3 years)
6
Loan Documents (executed Notes, Deeds of Trust, etc.) - For loan assumptions
only
7
Property Tax Bills (current and for past 3 years, including special assessments
or districts and appeals) & Assessment
8
[Intentionally Deleted]
9
Type of Accounting Software:
10
General Ledger - YTD and 1-year historical
11
Utility Bills (current & past 12 months)
12
[Intentionally Deleted]
 
MANAGEMENT/LEASING/OPERATIONS
1
Current Monthly Rent Rolls (showing, square footage, monthly rent, deposits,
financial concessions, other concessions, lease term, extension options,
defaults (financial or otherwise), and such other information as Buyer may
require)
2
Security Deposit/Resident Ledgers
3
Market Rent Survey (if available, comparison of subject w/other properties)
4
Occupancy History (past 3 years)
5
Leases for all tenants and all available tenant correspondence files (including
amendments/letters/agreements)
6
Form of Lease (with all addendums)
7
Schedule of leases under negotiation or leases out for signature
8
Aged Delinquency Report (showing total rent outstanding) and status of all files
placed for eviction or collection
9
[Intentionally Deleted]

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10
Copies of all operating & management service contracts, including but not
limited to:
11
a. Laundry
12
b. Landscaping
13
c. HVAC
14
d. Janitorial Services
15
e. Security
16
f. Equipment Leases (such as copier, etc.)
17
g. Trash
18
h. Pest Control
19
i. Pool
20
j. Cable/TV (if none, please indicate in writing)
21
k. Advertising
22
l. Fire Extinguisher
23
m. Apartment Furniture Rental
24
n. Alarm Monitoring
25
o. Elevator
26
p. Phone
27
q. Property Management Agreement; indicate whether entity is related party for
disclosure purposes
28
r. [Intentionally Deleted]
29
Inventory of Personal Property and Supplies Inventory (on site)
30
Current Staff Information (employees, titles, hire dates, salary, unit
information)
31
List of which utilities are paid by Resident & Owner
32
[Intentionally Deleted]
33
Schedule of required deposits (gas, electric, telephone, water)
34
Current list of all vendors utilized at the property
35
Property Brochure
36
Certificates of insurance; insurance loss runs
37
Pending Litigation Information (if applicable)
38
O&M Manuals
39
[Intentionally Deleted]
 
PHYSICAL ITEMS
1
Site Plan & Elevations
2
Unit Floor Plans (w/sq. footage)
3
[Intentionally Deleted]
4
Property Photos (including aerial photos if available)
5
Model Units, if any (apt. #, bedrooms, rent loss)
6
Building (# of bldgs., storage units, laundry rooms)
7
Parking (carport, garages, or open spaces & number of each type)
8
[Intentionally Deleted]
9
[Intentionally Deleted]
10
[Intentionally Deleted]
11
[Intentionally Deleted]
12
[Intentionally Deleted]
 
THIRD PARTY REPORTS
1
All existing reports, including, (but not limited to):

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2
a. Soils or Geotechnical Report
3
b. Phase I Environmental Report
4
c. [Intentionally Deleted]
5
d. [Intentionally Deleted]
6
e. [Intentionally Deleted]
7
f. [Intentionally Deleted]
8
g. [Intentionally Deleted]
9
h. [Intentionally Deleted]
10
i. [Intentionally Deleted]
11
j. Termite Report
12
k. [Intentionally Deleted]
13
l. [Intentionally Deleted]
14
m. Existing As-Built ALTA Survey
15
[Intentionally Deleted]
 
TITLE AND OTHER
1
Title Insurance Commitment and all recorded documents referenced therein
2
Any zoning report or compliance letter
 
CAPITAL SOURCE - SPECIFIC INFORMATION: REIT; ITEMS TO BE PROVIDED WITHIN TEN
(10) BUSINESS DAYS AFTER THE INSPECTION DATE
1
Property Services Questionnaire
2
Bank Reconciliations: YTD and Year-End for past 2 years
3
Trial Balance: Year-End for past 2 years and for the years then ended
4
Trial Balance as of 3/31/10 and for the 3-month period then ended
5
Cash Disbursement Journals: Monthly for current and previous years (cutoff
selections for expense testing)
6
Invoices and/or related support for Cash Disbursement Journals selected by E&Y
(to perform Cutoff Testing)
7
Signed Letter of Representation from Seller
8
Copy of 25 leases (as selected by E&Y) from the rent rolls provided
9
Copy of check/evidence of payment of property tax bills for all property tax
expenses recorded in previous year
10
APN Number for the parcel(s) being purchased (to verify the completeness of the
expense in #8 directly above)
11
Copy of invoices or service contract and evidence of payment (check copy or
other) for 25 expenses selected by E&Y (utilities, cleaning, repairs and
maintenance and G&A expense, etc.)
12
GL detail for the real estate balance sheet account for previous year and
quarters of previous year. Provide invoices for a sample of capitalized costs
(selections by TBD) in order to verify the completeness of repairs/maintenance
expense.
13
[Intentionally Deleted]
 
 
 
LOAN
 
[TO BE INSERTED]

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Schedule 4.2(a)
FORM OF SPECIAL WARRANTY DEED

Grantee’s mailing address:
_____________________
_____________________
_____________________
 

SPECIAL WARRANTY DEED
STATE OF OKLAHOMA    §
§
COUNTY OF TULSA    §

KNOW ALL PERSONS BY THESE PRESENTS:

THIS INDENTURE, is made this ____ day of __________, 20__, by ESTANCIA TULSA,
LLC, a Delaware limited liability company, Grantor, in favor of
_______________________. a _______________, Grantee.
WITNESSETH, that in consideration of the sum of One Dollar ($1.00) and other
good and valuable consideration, receipt of which is hereby acknowledged, said
party Grantor does by these presents, grant, bargain, sell and convey that
certain tract of real property in Tulsa County, Oklahoma (the “Property”), as
described on Exhibit “A” attached hereto and incorporated herein unto said party
Grantee, its successors and assigns.
TO HAVE AND TO HOLD THE SAME, together with all and singular the tenements,
hereditaments and appurtenances thereto belonging or in any wise appertaining
forever.

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And said party Grantor, its successors and assigns, does hereby covenant,
promise, and agree to and with said party Grantee, at the delivery of these
presents, that it is lawfully seized in its own right of an absolute and
indefeasible estate of inheritance in fee simple, of and in all and singular the
above granted and described Property, with the appurtenances; that the same are
free, clear, and discharged and unencumbered of and from all former and other
grants, titles, charges, estates, judgments, taxes, assessments and encumbrances
of whatsoever nature and kind, EXCEPT those matters described on Exhibit “B”
attached hereto and incorporated herein, and that party Grantor will WARRANT AND
FOREVER DEFEND the same unto the said party Grantee, successors and assigns and
all and every person or persons whomsoever lawfully claiming or to claim the
same, by, through, or under the Grantor, but not otherwise.
IN WITNESS WHEREOF, the party Grantor has caused this instrument to be executed
on behalf of the party Grantor the day and year above written.
ESTANCIA TULSA, LLC,
a Delaware limited liability company

By:
Flournoy Development Company, LLC,
a Georgia limited liability company,
its Manager

By:                         
Thomas H. Flournoy, its President

STATE OF GEORGIA     §
§
COUNTY OF MUSCOGEE     §
This instrument was acknowledged before me on the _____ day of ____________,
2011, by Thomas H. Flournoy, as President of Flournoy Development Company, LLC,
a Georgia limited liability company, as Manager of ESTANCIA TULSA, LLC, a
Delaware limited liability company, on behalf of such companies.

{SEAL)
 
Notary Public and for the State of Georgia

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Grantor's Name, Address, Phone:
Estancia Tulsa, LLC
c/o Flournoy Development Company, LLC
900 Brookstone Centre Parkway
Columbus, Georgia 31904
Telephone. 706/243-9406
Grantee’s Name, Address, Phone:
________________________
________________________
________________________
Attention: _______________
Telephone No. ____________

SEND TAX STATEMENTS TO GRANTEE

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Exhibits To Special Warranty Deed
A - Legal Description Of Land
B. - Permitted Exceptions

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Schedule 4.2(b)
[FORM OF BILL OF SALE AND ASSIGNMENT AND ASSUMPTION
OF LEASES AND SERVICE CONTRACTS]
* * *
BILL OF SALE AND ASSIGNMENT AND ASSUMPTION
OF LEASES AND SERVICE CONTRACTS
This Bill of Sale and Assignment and Assumption of Leases and Service Contracts
(this “Agreement”) is made and entered into this ____ day of _____, 2012, by and
between Estancia Tulsa, LLC, a Delaware limited liability company (“Seller”),
and ___________________, a ___________ (“Purchaser”).
W I T N E S S E T H:
WHEREAS, Seller and Purchaser (by assignment from Steadfast Asset Holdings,
Inc.) are parties to that certain Purchase and Sale Agreement, dated _____, 2012
[DESCRIBE AMENDMENTS, IF APPLICABLE] (the “Contract”), having [NAME OF ESCROW
AGENT] as party for the limited purposes set forth therein;
WHEREAS, concurrently with the execution and delivery of this Agreement and
pursuant to the Contract, Seller is conveying to Purchaser, by Special Warranty
Deed, (i) those certain tracts or parcels of real property located in the
______________, _____________ County, Oklahoma, and more particularly described
on Exhibit A, attached hereto and made a part hereof (the “Land”), (ii) the
rights, easements and appurtenances pertaining to the Land (the “Related
Rights”), and (iii) the buildings, structures, fixtures and other improvements
on and within the Land (the “Improvements”; and the Land, the Related Rights and
the Improvements being sometimes collectively referred to as the “Real
Property”);
WHEREAS, Seller has agreed to convey to Purchaser certain personal property and
assign to Purchaser certain leases and service contracts as hereinafter set
forth;
NOW, THEREFORE, in consideration of the receipt of Ten Dollars ($10.00), the
assumptions by Purchaser hereinafter set forth and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Seller and Purchaser agree as follows:
1.    Bill of Sale:
(a)    Seller hereby sells, assigns, transfers and conveys to Purchaser all of
Seller's right, title and interest in, to and under the Tangible Personal
Property and the Intangible Property. Seller warrants to Purchaser that Seller
owns good title to the Tangible Personal Property, that the Tangible Personal
Property is free and clear of all liens, charges and encumbrances other than the
Permitted Exceptions (as defined in the Contract), and that Seller has full
right, power and authority to sell the Tangible Personal Property and to make
this Bill of Sale. Seller further warrants to Purchaser

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that Seller has not conveyed to any third party its right, title and interest,
if any, in the Tangible Personal Property or the Intangible Property.
(b)    “Tangible Personal Property” means all tangible personal property owned
by Seller upon the Land or within the Improvements, including specifically,
without limitation, appliances, equipment, furniture, furnishings, carpeting,
draperies and curtains, tools and supplies, and other items of tangible personal
property owned by Seller and used exclusively in connection with the ownership,
use, maintenance or operation of the Land and the Improvements, and including
those items of tangible personal property identified on Exhibit B, attached
hereto and made a part hereof by this reference; provided, however, that the
Tangible Personal Property does not include the following items: (i) cash and
cash equivalents, (ii) except as provided in Section 1.5(iii) of the Contract,
any reserves or other deposits funded or made in connection with any financing
encumbering the Property, (iii) computer software and computer files, (iv) any
time clock(s), (v) personal property owned by tenants under the Leases, (vi) any
equipment installed by, or in connection with, any telecommunication or utility
provider and which is owned by a party other than Seller, (vii) any items owned
by employees of Seller or any property manager, (viii) any items leased to
Seller (excluding any interest that Seller may have therein which shall be
assigned to Purchaser to the extent assignable), and (ix) all brochures,
advertising copy, promotional materials, manuals, reports, portfolios, binders,
training materials and other items on which the name “Flournoy” appears.
(c)    “Intangible Property” means (i) all assignable existing warranties and
guaranties issued to or inuring to the benefit of Seller in connection with the
Improvements or the Tangible Personal Property; (ii) all governmental permits,
licenses and approvals, if any, belonging to or inuring to the benefit of Seller
or pertaining to the Real Property or the Tangible Personal Property, but only
to the extent that such permits, licenses and approvals are assignable, but only
to the extent that such permits, licenses and approvals are assignable; (iii)
resident and tenant files for current residents and tenants as of the Closing
Date, (iv) architectural and civil plans and specifications and other surveys or
studies (to the extent in Seller’s possession or control), and (v) other
non-confidential (as to third-parties) and non-proprietary records owned by
Seller and used in connection with the operation of the Real Property or any
part thereof, and located on-site as of the Closing Date (the property described
in this subparagraph 1(c), other than the excluded items, being sometimes herein
referred to collectively as the “Intangible Property”).
2.    Assignment and Assumption of Leases:
(a)    Seller hereby sells, assigns, transfers and conveys to Purchaser all of
Seller's right, title and interest as landlord in, to and under all rental
agreements, leases and other agreements in effect as of the date of this
Agreement demising space in or providing for the use or occupancy of the Real
Property (the “Leases”), together with any and all unapplied refundable tenant
security and other unapplied refundable deposits in Seller's possession or
control with respect to the Leases as of the date of this Agreement
(collectively, the “Deposits”). The assignment of the Deposits has been made by
means of a credit or payment on the closing statement executed by Seller and
Purchaser.
(b)    Purchaser hereby assumes all of the covenants, agreements, conditions and

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other terms and provisions stated in the Leases which, under the terms of the
Leases, are to be performed, observed, and complied with by the landlord from
and after the date of this Agreement. Purchaser acknowledges that Purchaser
shall become solely responsible and liable as landlord under the Leases for
obligations arising or accruing from and after the date hereof.
(c)    Seller shall indemnify, hold harmless and defend Purchaser from and
against any and all claims, demands, causes of action, liabilities, losses,
costs, damages and expenses (including reasonable attorneys' fees and expenses
and court costs incurred in defending any such claim or in enforcing this
indemnity) that may be incurred by Purchaser by reason of the assertion by any
tenant under any of the Leases that Seller has failed to perform, observe and
comply with its obligations as landlord under any of the Leases during the
period before the date hereof, other than with respect to the Deposits (to the
extent paid to Purchaser or for which Purchaser has received a credit or payment
at Closing).
(d)    Purchaser shall indemnify, hold harmless and defend Seller from and
against any and all claims, demands, causes of action, liabilities, losses,
costs, damages and expenses (including reasonable attorneys' fees and expenses
and court costs incurred in defending any such claim or in enforcing this
indemnity) that may be incurred by Seller by reason of the failure of Purchaser
to perform, observe and comply with the landlord's obligations under any of the
Leases arising or accruing during the period from and after the date hereof,
including without limitation, claims made by tenants with respect to the
Deposits, whether arising before, on or after the date hereof (to the extent
paid to Purchaser or for which Purchaser has received a credit or payment at
Closing).
(e)    For purposes of this Paragraph 2, the word “landlord” means the landlord,
lessor or other equivalent party under any of the Leases, and the word “tenant”
means the tenant, lessee or other equivalent party under any of the Leases.
3.    Assignment and Assumption of Service Contracts:
(a)    Seller hereby sells, assigns, transfers and conveys to Purchaser all of
Seller's right, title and interest in, to and under those service, supply,
equipment rental and similar agreements set forth on Exhibit C, attached hereto
and made part hereof by this reference (the “Service Contracts”).
(b)    Purchaser hereby assumes all of the covenants, agreements, conditions and
other terms and provisions stated in the Service Contracts which, under the
terms of the Service Contracts, are to be performed, observed, and complied with
by the property owner from and after the date of this Agreement. Purchaser
acknowledges that Purchaser shall become solely responsible and liable under the
Service Contracts for obligations arising or accruing from and after the date
hereof, including with respect to any and all payments coming due under the
Service Contracts for which Purchaser has received a credit or payment on the
closing statement executed by Purchaser and Seller (the “Credited Payments”).
(c)    Seller shall indemnify, hold harmless and defend Purchaser from and
against any and all claims, demands, causes of action, liabilities, losses,
costs, damages and expenses (including reasonable attorneys' fees and expenses
and court costs incurred in defending any such claim or in

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enforcing this indemnity) that may be incurred by Purchaser by reason of the
assertion by any other contract party under any of the Service Contracts that
Seller has failed to perform, observe and comply with its obligations under any
of the Service Contracts during the period before the date hereof, other than
with respect to the Credited Payments (to the extent paid or assigned to
Purchaser or for which Purchaser has received a credit or payment at Closing).
(d)    Purchaser shall indemnify, hold harmless and defend Seller from and
against any and all claims, demands, causes of action, liabilities, losses,
costs, damages and expenses (including reasonable attorneys' fees and expenses
and court costs incurred in defending any such claim or in enforcing this
indemnity) that may be incurred by Seller by reason of the failure of Purchaser
to perform, observe and comply with its obligations under any of the Service
Contracts arising or accruing during the period from and after the date hereof,
including without limitation, claims made by any other contract party with
respect to the Credited Payments, whether arising before, on or after the date
hereof (to the extent paid or assigned to Purchaser or for which Purchaser
received a credit or payment at Closing).
4.    Qualifications. This Agreement is subject to the Permitted Exceptions (as
defined in the Contract). This Agreement is also subject to those provisions of
the Contract limiting Seller's liability to Purchaser, including but not limited
to Article 10 of the Contract.
5.    Counterparts. This Agreement may be executed in two or more identical
counterparts, and it shall not be necessary that any one of the counterparts be
executed by all of the parties hereto. Each fully or partially executed
counterpart shall be deemed an original, but all of such counterparts taken
together shall constitute one and the same instrument.
6.    Successors and Assigns. This Agreement shall inure to the benefit of, and
be binding upon, the successors, executors, administrators, legal
representatives and assigns of the parties hereto.
7.    Governing Law. This Agreement shall be construed under and enforced in
accordance with the laws of the State of Oklahoma.

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EXECUTED effective as of the date first above written.

SELLER:
_________________________________,
a ____________________________
By    ___________________________,  
a ____________________________
By:   ___________________________
Name: __________________________
Title:   __________________________

PURCHASER:
________________________________,
a ____________________________
 
By: _________________________________
Name: _______________________________
Title: ________________________________

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Exhibits to
Bill of Sale and Assignment
A - Legal Description of Land
B - Inventory of Tangible Personal Property
C - List of Designated Service Contracts

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EXHIBIT 4.2(c)
“TENANT NOTICE “
________________,         
Dear Resident:

This is to notify you that today, the property located at (street address, city,
state, zip), and more commonly known as Estancia at Tulsa Apartments, has been
sold by Estancia Tulsa, LLC, (“Seller”) to (name of buyer) (“Purchaser”). As of
the date hereof, Seller’s interest in your lease (including without limitation,
your security deposit) has been assigned to Purchaser and Purchaser has assumed
all obligations as “Landlord” or “Lessor” under your lease.

Located in (city, state), (name of buyer) is affiliated with the Steadfast
Companies, which was founded in 1994.

Effective today, all rent and other payments due pursuant to your occupancy of
the premises, whether pursuant to your lease or otherwise, are to be paid by
check, payable to:

(name of property)
(street address of property)
(city, state, zip of property)

On behalf of Flournoy Properties, we want to thank you for making Estancia at
Tulsa Apartments your home. It has been our pleasure to serve you. Any future
inquiries regarding your lease should be directed to the Purchaser at the
contact information listed above.

    
Very truly yours,

ESTANCIA TULSA, LLC,
a Delaware limited liability company

By:
Flournoy Development Company, LLC,
a Georgia limited liability company,
its Manager

By:                         
Thomas H. Flournoy, its President

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Schedule 4.2(d)

FORM OF SELLER'S CLOSING CERTIFICATE
_____________________________________________________________________________
Seller's Closing Certificate
THIS CERTIFICATION is made as of _____________, 20__, by Estancia Tulsa, LLC, a
Delaware limited liability company (“Seller”), in favor of
_______________________, a __________ (“Purchaser”).
Seller hereby certifies to Purchaser that the representations and warranties of
Seller set forth in Section 5.1 of that certain Purchase and Sale Agreement
between Seller and _________________________ [if applicable: as amended] (the
“Agreement”) dated as of __________, 20__, as amended, are true and correct in
all material respects as of the date hereof, except as to:
(a)
The Rent Roll attached hereto as Exhibit A replaces the Rent Roll attached to
the Agreement as Schedule 1.3; and

(b)
[If applicable: The items disclosed on Exhibit B attached hereto replace
Seller's Disclosure Schedule attached to the Agreement as Schedule 5.1].

The representations and warranties set forth in Section 5.1 of the Agreement, as
updated by this Certificate of Seller's Representations and Warranties, will
survive only for a period of nine (9) months from the date hereof.
This certificate is delivered pursuant to Section 4.2(d) of the Agreement, and
Seller's liability hereunder is subject to Section 5.3 of the Agreement,
including the Cap as defined therein.
____________________________________
a __________________________________

By:     ___________________________,
a ___________________________
 

By:                     
Name:                     
Title:                     

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Exhibits to Seller's Closing Certificate

Exhibit A --     Updated Rent Roll
Exhibit B --     Additional Items for Seller's Disclosure Schedule [if
applicable]

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Schedule 5.1
SELLER'S DISCLOSURE STATEMENT
NONE.

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Schedule 5.7(b)
SCHEDULE OF MUST TAKE SERVICE CONTRACTS
Windstream Communications
Cox Communications
Cort Furniture Rental