Exhibit 10.8

PURCHASE AND SALE CONTRACT

between

AVALON ILLINOIS VALUE II, LLC

and

LEGACY PARTNERS RESIDENTIAL LLC

AVALON AT POPLAR CREEK
Schaumburg, Illinois

as of December 9, 2011

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Table of Contents
ARTICLE 1     Description of Property
ARTICLE 2.    Sale Subject to Leases
ARTICLE 3.    Purchase Price and Payment
ARTICLE 4.    Conveyance of Title
ARTICLE 5.    Closing
ARTICLE 6.    Approvals and Conditions to Buyer's Obligations
ARTICLE 7.    Conditions to Closing
ARTICLE 8.    Default
ARTICLE 9.    Entire Agreement Herein
ARTICLE 10.    Damage or Destruction: Condemnation
ARTICLE 11.    Representations and Warranties of Seller
ARTICLE 12.    Operations
ARTICLE 13.    Apportionment of Taxes and Other Charges
ARTICLE 14.    Broker
ARTICLE 15.    Recording
ARTICLE 16.    Notices
ARTICLE 17.    Captions
ARTICLE 18.    Successors and Assigns
ARTICLE 19.    Closing Costs
ARTICLE 20.    Governing Law
ARTICLE 21.    Multiple Counterparts

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ARTICLE 22.    Representations and Warranties of Buyer
ARTICLE 23.    Post‑Closing Obligations
ARTICLE 24.    Duties and Responsibilities of Escrow Agent
ARTICLE 25.    Waiver of Jury Trial
ARTICLE 26.    Additional Offers
ARTICLE 27.    Like Kind Exchange
ARTICLE 28.    Time of the Essence
ARTICLE 29.    Confidentiality
Exhibits
Exhibit A    Description of Real Property
Exhibit B    Personal Property
Exhibit C    Leases and Rent Roll
Exhibit D    Form of Deed
Exhibit E    Form of Bill of Sale
Exhibit F    Form of Assignment and Assumption Agreement (re: Leases)
Exhibit G    Form of Assignment and Assumption Agreement (re: Contracts)
Exhibit H    Form of FIRPTA Affidavit
Exhibit I    Operating Contracts
Exhibit J    Litigation, etc.
Exhibit K    Audit Materials

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PURCHASE AND SALE CONTRACT
THIS PURCHASE AND SALE CONTRACT (the "Contract") made as of this 9th day of
December, 2011 (the “Effective Date”), by and between AVALON ILLINOIS VALUE II,
LLC having an office c/o AvalonBay Communities, Inc., Ballston Tower, 671 N.
Glebe Road, Suite 800, Arlington, Virginia 22203 (hereinafter referred to as
"Seller"), and LEGACY PARTNERS RESIDENTIAL LLC, a Delaware limited liability
company, having an office at7525 SE 24th Street, Suite 180, Mercer Island,
Washington 98040 (hereinafter referred to as "Buyer").
Seller owns the land described on Exhibit A hereto together with the buildings
and improvements thereon, comprising a multifamily residential housing complex
consisting of 196 multifamily apartment units in the Village of Schaumburg,
Illinois, and commonly known as Avalon at Poplar Creek.
Seller desires to sell and Buyer desires to purchase the Property (as
hereinafter defined) on the terms and subject to the conditions set forth
herein.
NOW THEREFORE, for the consideration hereinafter named, and for other good and
valuable consideration, receipt of which is acknowledged hereby, the parties do
hereby agree as follows:
ARTICLE 1. Description of Property: Seller agrees to sell and Buyer agrees to
buy upon the terms and conditions hereinafter set forth:
(i) Certain premises located in Schaumburg, Illinois, commonly known as Avalon
at Poplar Creek, as more particularly described in Exhibit A attached hereto and
incorporated herein by reference, together with all right, title and interest of
Seller in and to any land lying in the bed of any street (opened or proposed)
adjacent to or abutting or adjoining such premises, together with all rights,
privileges, rights of way and easements appurtenant to such premises, including,
without limitation, any easements, rights of way or other interests in, on, or
under any land, highway, alley, street or right of way abutting or adjoining
such premises (all of the foregoing, the "Real Property"), (ii) all buildings
and other improvements located thereon (the "Improvements", and, together with
the Real Property, the "Premises"), (iii) all items of personal property owned
by Seller and located on the Premises or used in connection with the ownership
or operation of the Premises, described in Exhibit B attached hereto and
incorporated herein by reference, including, without implied limitation, whether
or not listed on Exhibit B, all furniture, fixtures, equipment, machines,
apparatus, appliances, supplies and personal property of every nature and
description and all replacements thereof (collectively, the “Personal Property”)
but expressly excluding (a) items of personal property owned by Seller and used
in connection with the Property as part of Seller’s integrated systems of
ownership, management and/or operations of apartment projects, such as, by way
of example and

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without limitation, the computer software for the key track system, computer and
phone systems and software, corporate licenses, and management and financial
reporting systems and software, (b) utility deposits, (c) non-refundable
deposits and (d) non-refundable lump sum payments previously made under any
Leases (other than advance rents); and (iv) all of the Leases and Assumed
Contracts (as hereinafter defined). All items referred to in clauses (i), (ii),
(iii) and (iv) are herein sometimes collectively referred to as the "Property".
In connection with the ownership, management and operation of the Property and
other properties owned and/or managed by Seller, Seller has used and may
continue to use the tradenames, trademarks and servicemarks "Avalon," "Avalon
Communities," fleur de lis, "Time Well Spent," "AvalonBay,", "Avalon on," Avalon
at," "Avalon by the," "Avalon on the," and "Avalon at the," (collectively,
together with all improvements and additions whenever made to or associated with
any of the foregoing by Seller or anyone else, the "Marks"). Notwithstanding
anything herein express or implied to the contrary, Buyer acknowledges that it
has no interest in and is not acquiring any right to the Marks and agrees and
acknowledges that the Marks are trademarks and servicemarks owned by Seller and
that the Marks are and will continue to be the sole property of Seller.
Following the Closing, Buyer shall have no rights to use or display any of the
Marks for any purpose whatsoever. Immediately following the Closing Buyer will
remove any and all signs, materials, documents, inventory, amenities, supplies
or other matter containing the Marks. Buyer agrees that it shall not challenge
or contest in any way (i) Seller's registration or application for registration
of the Marks with the U.S. Patent & Trademark Office, or with any other
trademark office; (ii) the validity of the Marks; (iii) Seller's exclusive
worldwide ownership of the Marks; or (iv) Seller's right to grant to others
licenses to use the Marks.
ARTICLE 2. Sale Subject to Leases: Subject to the provisions of Article 4
hereof, the Premises will be conveyed subject to certain leases (hereinafter
called the "Leases") described in Exhibit C attached hereto and incorporated
herein by reference, or as hereafter added pursuant to the provisions of Article
12 hereof.
ARTICLE 3. Purchase Price and Payment: (a) The total purchase price (the
"Purchase Price") for the Property is TWENTY SEVEN MILLION THREE HUNDRED
THOUSAND AND 00/100 Dollars ($27,300,000.00) which shall be payable at the
Closing, as hereinafter defined, in lawful currency of the United States of
America in immediately available funds by wire transfer to an account designated
by Seller.
(b)    As security for Buyer's performance hereunder, a deposit of Two Hundred
Fifty Thousand Dollars ($250,000.00) is being paid by Buyer within two (2)
business days after complete execution of this Contract to First American Title
Insurance Company, 633 Third Avenue, New York, New York 10017, Attention:
Phillip Salomon ("Escrow Agent") who shall deposit it in a federally insured
interest‑bearing money market account and disburse it according to the terms of
this Contract. If Buyer does not terminate this Contract on or prior to December
30, 2011 (the “Due Diligence Expiration

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Date”), Buyer shall, on or prior to such date, deposit an additional Seven
Hundred Fifty Thousand Dollars ($750,000.00) with the Escrow Agent. All amounts
deposited with Escrow Agent, together with all interest earned thereon, are
hereinafter referred to as the "Deposit". The Deposit shall be applied in
reduction of the Purchase Price payable at the Closing. Escrow Agent's duties
and responsibilities are governed by the terms of Article 24 hereof.
(c)    The payment required at the Closing shall be increased or decreased, as
the case may be, to account for all items to be apportioned or prorated pursuant
to this Contract.
ARTICLE 4. Conveyance of Title: (a) At Closing, Seller shall convey and transfer
to Buyer such fee simple marketable title to the Premises as will enable Escrow
Agent (the “Title Company”) to issue to Buyer, an ALTA Owner’s Policy of Title
Insurance (the “Title Policy”) covering the Premises, in the full amount of the
Purchase Price (subject only to the Permitted Exceptions (as defined below)).
Notwithstanding anything contained herein to the contrary, the Premises shall be
conveyed subject to the following matters, which shall be deemed to be Permitted
Exceptions:
(a)
the rights of tenants, as tenants only, under the Leases and any new Leases
entered into between the date hereof and Closing in accordance with the terms of
this Contract;

(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 and zoning laws, ordinances and regulations, now or
hereafter in effect relating to the Property;

(d)
such state of facts as may be shown on a current survey;

(e)
the standard preprinted form exceptions set forth in an ALTA Owner’s Title
Policy; and

(f)
those matters which Seller is not obligated to remove as provided below.

Buyer shall have until six (6) days prior to the Due Diligence Expiration Date
set forth in Article 6 to notify Seller, in writing, of such objections to title
as Buyer may have. Any title matter to which Buyer does not so object by such
time shall be deemed a Permitted Exception. In the event Buyer shall so notify
Seller of any objection(s) to title, Seller shall have the right, but not the
obligation, to cure such objection(s), provided that any defects, objections or
exceptions which comprise mortgages or liens voluntarily created by Seller which
can be satisfied by payment of a liquidated amount shall be paid discharged or
complied with at or before the Closing by Seller and such shall not in any

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event be an exception in Buyer’s Title Policy. In the event there are any
objections which Seller is not obligated to cure, then within two (2) days after
receipt of Buyer’s notice of objection(s), Seller shall notify Buyer in writing
whether Seller elects to attempt to cure such objection(s). Failure of Seller to
give such notice shall be deemed an election by Seller not to cure such
objection(s). If Seller elects to attempt to cure any such matter, Seller shall
use reasonable efforts to cure such objections. If Seller elects not to cure any
objection(s) specified in Buyer’s notice which Seller is not required hereby to
cure, or if Seller is unable to effect a cure prior to the Closing, Buyer shall
have the following options to be given by written notice within two (2) days of
Seller’s notice or deemed election: (i) to accept a conveyance of the Property
subject to the Permitted Exceptions, specifically including any matter objected
to by Buyer which Seller is unwilling or unable to cure (which such matter(s)
shall thereafter be deemed to be a Permitted Exception), without reduction of
the Purchase Price, or (ii) to terminate this Contract by sending written notice
thereof to Seller, and upon delivery of such notice of termination, this
Contract shall terminate and the Deposit shall be returned to Buyer, and
thereafter neither party hereto shall have any further rights, obligations or
liabilities hereunder except for the Surviving Obligation, as hereinafter
defined.
Buyer may prior to Closing, notify Seller in writing of any objection to title
(excluding objections to title which have been waived by Buyer as hereinabove
provided or that are or are deemed to be Permitted Exceptions) arising after the
date hereof. With respect to any objections to title set forth in such notice,
Seller shall have the same options to cure and Buyer shall have the same option
to accept title subject to such maters or to terminate this Contract, as set
forth above.
ARTICLE 5. Closing: (a) The closing of the transactions contemplated hereunder
(the "Closing") shall take place at 12:00 noon New York time on February 9, 2012
(the " Closing Date") at the offices of the Escrow Agent, or at such other
location as Buyer shall designate by five (5) business days prior written
notice. Time is of the essence.
(b)    At the Closing, Seller shall deliver the following documents in the forms
attached hereto or otherwise, reasonably satisfactory in form and substance to
Seller and Buyer and their counsel, properly executed and acknowledged as
required:
(i)
A deed (the “Deed”) in the form of Exhibit D;

(ii)
A Bill of Sale in the form of Exhibit E;

(iii)
An original of an Assignment and Assumption Agreement relating to the Leases and
security deposits, key deposits, pet deposits, last month’s rent and accrued
interest thereon to the extent required by the Lease or applicable law, but
excluding any of such deposits which are non-refundable (collectively, the
“Security Deposits”) in the form attached hereto as Exhibit F (the "Lease
Assignment");

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(iv)
Originals of all Leases, any renewals thereof and all amendments thereto to the
extent in Seller’s possession or control will be delivered at the Premises;

(v)
An original of an Assignment and Assumption Agreement in the form attached
hereto as Exhibit G relating to the Operating Contracts (as hereinafter defined)
(the "Contract Assignment");

(vi)
To the extent not previously delivered originals or copies of all certificates
of occupancy in Seller’s possession or control for all of the Improvements which
form a part of the Property and all tenant‑occupied space included within such
buildings;

(vii)
A certification of non‑foreign status in the form attached hereto as Exhibit H
and incorporated herein by reference;

(viii)
Evidence satisfactory to the Title Company that all necessary approvals and/or
consents by the directors of Seller have been delivered and such other evidence
satisfactory to the Title Company of Seller's authority and the authority of the
signatory on behalf of Seller to convey the Premises pursuant to this Contract;

(ix)
Originals or a copy of as‑built plans and specifications for the Improvements
(if in Seller's possession or control if not delivered at the Premises);

(x)
All Security Deposits, together with accrued interest thereon if payable under
the Leases or pursuant to applicable law;

(xi)
Affidavits sufficient for the Title Company to delete any exceptions for parties
in possession (other than tenants under the Leases, as tenants only) and
mechanics' or materialmen's liens from the Title Policy;

(xii)
A Rent Roll certified as true and correct in all material respects to Seller’s
actual knowledge as of five days before the Closing Date which certification
shall be subject to the qualifications and limitations set forth in Article
11(b);

(xiii)
An original of a closing statement setting forth the Purchase Price, the closing
adjustments and prorations and the application thereof at the Closing (the
"Closing Statement");

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(xiv)
Such transfer tax, gains or other similar forms required by law;

(xv)
Copy of standard tenant notification letter in a form to be drafted by Buyer and
satisfactory to Seller and as required by law;

(xvi)
Evidence of payment to the Broker (hereinafter defined); and

(xvii)
a certificate certifying that all of the representations and warranties of
Seller set forth in this Contract are true and correct on the Closing Date as if
made at and as of Closing Date or the extent to which any of such
representations or warranties are no longer true and correct

(c)    At the Closing, Buyer shall deliver, or cause to be delivered, the
following payment and documents, reasonably satisfactory in form and substance
to Seller and Seller's counsel properly executed and acknowledged as required:
(i)    The Purchase Price as adjusted;
(ii)    An original of the Lease Assignment;
(iii)    An original of the Contract Assignment;
(iv)    An original of the Closing Statement; and
(v)    Such transfer tax, gains or other similar forms required by law.
ARTICLE 6. Approvals and Conditions to Buyer's Obligations:
(a)    Notwithstanding anything to the contrary contained in this Contract,
Seller acknowledges that Buyer shall have the right in its sole and absolute
discretion, upon its disapproval of any of the information it receives, to
terminate this Contract. In the event Buyer notifies Seller in writing on or
before 5:00 p.m. Pacific time on the Due Diligence Expiration Date (defined in
Article 3) that it has accepted the Property (the “Approval Notice”), Buyer
shall be deemed to have waived any objection to the condition of the Property
and the transaction contemplated herein shall proceed in accordance with the
terms of this Contract. If Buyer notifies Seller in writing of its election to
terminate this Contract by 5:00 p.m. Pacific time on the Due Diligence
Expiration Date or if Buyer fails to timely deliver the Approval Notice, this
Contract shall be deemed terminated, in which event the Deposit shall be
returned to Buyer forthwith. In such case, upon the return of the Deposit to
Buyer all obligations of the parties hereto shall cease and this Contract shall
be terminated and the parties shall be without further recourse or remedy
hereunder other than Buyer’s indemnity to Seller set forth in Article 6(b) below
(the “Surviving Obligation”).

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(b)    Seller hereby grants to Buyer and to Buyer’s employees, agents,
representatives and contractors (hereinafter collectively referred to as
“Buyer’s Agents”), a license expiring on the earlier of a termination of this
Agreement or the Closing Date, to enter upon the Property and to the
non-proprietary, non-confidential records, if any, maintained by Seller or by
Seller’s property management company, in each case during normal business hours.
Such access shall be for the purposes of (a) reviewing leases and contracts and
any records relating thereto; (b) reviewing records relating to the operating
expenses; and (c) inspecting the physical condition of the Property and
conducting physical and environmental inspections of the Property.
Notwithstanding anything contained herein to the contrary, without first
obtaining Seller’s consent thereto, neither Buyer nor any Buyer’s Agent shall
(1) contact any tenant of the Property, (2) notify any governmental agency of
any actual or potential violation of any zoning, environmental or other law,
rule, or regulation, or (3) conduct any intrusive investigation regarding the
Property or other environmental samplings. Buyer agrees that, in exercising its
right of access hereunder, Buyer will use, and will cause Buyer’s Agents to use,
their commercially reasonable efforts not to unreasonably interfere with the
activities of tenants or other persons occupying or providing service at the
Property. Buyer shall, at least two (2) business days prior to the inspection,
give Seller notice of its intention to conduct any inspection so that Seller
shall have an opportunity to have a representative present during any such
inspection, and Seller expressly reserves the right to have a representative
present. Buyer agrees to cooperate with any reasonable request by Seller in
connection with the timing of any such inspection. The access granted hereunder
is intended to convey and grant onto Buyer a temporary right to enter upon the
Property and to conduct the activities stated herein. By acceptance hereof,
Buyer agrees to bear the full cost and expense of any activities with respect to
and in accordance with this Contract. In consideration for Buyer’s use of the
Property, Buyer agrees to be responsible for all damages caused to the buildings
or land situated on the Property which damages result from the acts or
negligence of Buyer or Buyer’s Agents upon the Property. Buyer agrees that, in
making any physical and environmental inspections of the Property, Buyer and all
of Buyer’s Agents entering on the Property shall carry not less than
$2,000,000.00 commercial general liability insurance (on an occurrence basis)
insuring all activity and conduct of Buyer and such agents while exercising the
right of access provided for in this Contract and naming Seller as an additional
insured. Prior to Buyer or any Buyer’s Agent entering the Property, and upon
request of Seller, Buyer will provide Seller with written evidence of the
insurance required under this Section. Buyer shall, at its sole cost and expense
and in accordance with all requirements of applicable law, promptly restore any
damage or alteration of the physical condition of the Property which results
from any inspection or activity conducted by Buyer or any Buyer’s Agent. The
provisions of this Section 5 shall survive any termination of this Contract.
(c)    Buyer has informed Seller that Buyer is required by law to complete, with
respect to certain matters relating to the Property, an audit commonly known as
a "3-14" Audit. In connection therewith, on or prior to January 20, 2012, Seller
has provided or shall provide to Buyer the materials listed on Exhibit K
attached hereto (the “Audit Materials”); provided, however, that certain
information will be made available either at

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the Property or in Seller’s centralized accounting office in Virginia Beach,
Virginia, as indicated on Exhibit K. If Seller has not provided any Audit
Materials in a timely fashion, Buyer shall give Seller notice of specific
missing items by no later than the close of business on January 20, 2012, in
which case Seller shall have until the close of business on January 25, 2012 to
deliver such Audit Materials. Seller shall make its property manager available
to Buyer for interviews regarding the Property. In addition, Seller shall
provide to Buyer a year to date income statement, trial balances and general
ledger for Seller’s period of ownership in calendar year 2012 as soon as
practicable after the Closing. In no event shall Seller be in default for any
failure to deliver or provide access to the Audit Materials so long as it is not
intentionally withholding information in its possession, it being understood
that Buyer’s rights if it determines that it is unable to compete the 3-14 audit
based on the information it obtains from Seller shall be to terminate this
Contract by written notice to Seller, whereupon the Deposit shall be returned to
Buyer and there shall be no further recourse to the parties hereto except for
the Surviving Obligation.
(d)    Except as set forth in this Contract, the Property is being acquired by
Buyer in an “AS IS” condition and “WITH ALL FAULTS” existing as of the Closing
Date. Buyer acknowledges that it will be acquiring the Property on the basis of
its own investigations. Except as expressly set forth in this Contract, no
representations or warranties have been made or are made and no responsibility
has been or is assumed by Seller or by any officer, person, firm, agent or
representative acting or purporting to act on behalf of the Seller as to
condition or repair of the Property or the value, expense of operation, or
income potential thereof, the reliability of any information furnished to Buyer
or as to any other fact or condition which has or might affect the Property or
the condition, repair, value, expense of operation or income potential of the
Property or any portion thereof. Buyer hereby expressly releases the Seller
Group (hereinafter defined) from any and all claims, losses, proceedings,
damages, causes of action, liability, costs or expenses (including attorneys'
fees) arising from, in connection with or caused by (a) Buyer's reliance upon
any of the information provided to Buyer by Seller or anyone acting on behalf of
Seller, including, without limitation the Audit Materials and any other
materials provided or made available to Buyer during its due diligence
investigations (“Property Information”) or statements, representations or
assertions contained therein (but expressly excluding the express
representations and warranties contained in this Contract), or (b) inaccuracy,
incompleteness or unreliability of any of the Property Information other than
the express representations and warranties contained in this Contract. Buyer
hereby waives, releases and forever discharges Seller, any affiliate of Seller
and any shareholder, officer, director, employee, agent or person acting on
behalf of Seller or such affiliate of Seller (the "Seller Group") of and from
any and all claims, actions, causes of action, demands, rights, damages,
liabilities and costs whatsoever, direct or indirect, known or unknown, which
Buyer now has or which may arise in the future, against the Seller Group related
in any way to the Property other than as may be related to a breach of Seller’s
representations and warranties contained in

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this Contract and/or in the documents delivered by Seller to Buyer at Closing.
Buyer hereby agrees not to assert any claim for contribution, cost, recovery or
otherwise against Seller Group relating directly or indirectly to the physical
condition of the Property including, without limitation, the existence of oil,
lead paint, lead, radon, asbestos, mold, or hazardous materials or substances
on, or the environmental condition of, the Property, whether known or unknown.
The parties agree that all understandings and agreements heretofore made between
them or their respective agents or representatives are merged in this Contract
and the Exhibits hereto annexed, which alone fully and completely express their
agreement, and that this Contract has been entered into after full
investigation, or with the parties satisfied with the opportunity afforded for
investigation, neither party relying upon any statement or representation by the
other unless such statement or representation is specifically embodied in this
Contract or the Exhibits annexed hereto. Buyer acknowledges that Seller has
required Buyer to inspect fully the Property and investigate all matters
relevant thereto, and, except with respect to information provided and certified
to by Seller to Buyer, to rely solely upon the results of Buyer’s own
inspections or other information obtained or otherwise available to Buyer,
provided that the foregoing shall not diminish Buyer’s rights with respect to
any representations or warranties expressly made by Seller in this Contract. The
provisions hereof shall survive Closing. The foregoing shall not derogate from
Buyer’s rights in the event of a breach or default by Seller occurring prior to
the Closing under Article 8 hereof.
ARTICLE 7. Conditions to Closing: Without limiting any other conditions to
Buyer's obligations to close set forth in this Contract, the obligations of
Buyer under this Contract are subject to the satisfaction at the time of Closing
of each of the following conditions (any of which may be waived in whole or in
part by Buyer at or prior to Closing):
(i)
All of the representations and warranties by Seller set forth in this Contract
or any Exhibit attached hereto shall be true and correct in all material
respects, as if made on and as of the Closing Date, provided that changes to any
representations or warranties regarding the Leases or the Rent Roll based on
action of Seller that are permitted by this Contract shall not constitute a
condition of Closing;

(ii)
Seller shall have performed, observed, and complied in all material respects
with all covenants and agreements required by this Contract to be performed by
Seller at or prior to Closing; and

(iii)
Seller shall have taken such actions under Article 4 hereof to enable the Title
Insurer to irrevocably and unconditionally commit to issue the Title Policy to
Buyer as of the Closing Date.

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If any condition set forth herein is not fully satisfied on or before the
Closing Date, Seller may elect to attempt to satisfy any such unsatisfied
condition, and if Seller so elects by written notice to Buyer, Seller shall have
until the date occurring ten (10) days after the Closing Date in which to
satisfy such condition, and the Closing Date shall be extended for such period.
ARTICLE 8. Default: (a) In the event Seller fails to fulfill any of its
obligations hereunder and such failure continues for ten (10) days after written
notice from Buyer to Seller, Buyer shall have any one of the following rights
and remedies:
(i)
Buyer shall have the right to terminate this Contract by notice to Seller, in
which event the Deposit together with interest thereon shall be paid to Buyer,
and all obligations of the parties under this Contract shall terminate except
for Buyer’s Surviving Obligation; or

(ii)
Buyer shall have the right to waive the breach or default and proceed to Closing
in accordance with the provisions of this Contract without reduction of the
Purchase Price; or

(iii)
Buyer may seek specific performance of Seller’s obligations under this Contract
for any intentional or willful breach by Seller; or

(iv)
In the event specific performance is unavailable to Buyer as a remedy for any
such intentional or willful breach, the Deposit shall be returned to Buyer and
Seller shall reimburse Buyer for all out of pocket costs actually incurred by
Buyer in connection with the transaction contemplated herein but in no event
more than One Hundred Thousand and 00/100 Dollars ($100,000.00) .

(b)    IN THE EVENT THE SALE OF THE PROPERTY IS NOT CONSUMMATED BECAUSE OF A
DEFAULT UNDER THIS CONTRACT ON THE PART OF THE BUYER, BUYER AND SELLER AGREE
THAT IT WOULD BE EXTREMELY DIFFICULT AND IMPRACTICAL TO DETERMINE THE AMOUNT AND
EXTENT OF DETRIMENT TO SELLER. BUYER AND SELLER THEREFORE AGREE THAT, IF SALE
FAILS TO BE CONSUMMATED DUE TO BUYER’S DEFAULT HEREUNDER, BUYER’S DEPOSIT IS A
REASONABLE ESTIMATE OF SELLER’S DAMAGES AND THAT SELLER SHALL BE ENTITLED TO
SAID SUM AS LIQUIDATED DAMAGES, WHICH SHALL BE SELLER’S SOLE AND EXCLUSIVE
REMEDY, EITHER AT LAW OR IN EQUITY, AS A RESULT OF SUCH DEFAULT. IN SUCH EVENT,
THE ESCROW AGENT SHALL UPON WRITTEN DEMAND BY SELLER WITHOUT JOINDER OF BUYER,
IMMEDIATELY DELIVER THE DEPOSIT TO SELLER. TO SIGNIFY THEIR AWARENESS AND
AGREEMENT TO BE BOUND BY THE TERMS AND PROVISIONS OF THIS SECTION, BUYER AND
SELLER HAVE SEPARATELY

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INITIALED THIS SECTION. NOTWITHSTANDING THE FOREGOING, NOTHING IN THIS SECTION
8(b) SHALL LIMIT ANY RECOVERY BY SELLER UNDER ANY INDEMNITIES MADE BY BUYER
HEREIN OR SELLER'S RIGHTS TO ANY ATTORNEYS' FEES OR COSTS RECOVERABLE BY SELLER
HEREUNDER.
SELLER INITIALS: _____                BUYER’S INITIALS: ______
ARTICLE 9. Entire Agreement Herein: The parties understand and agree that their
entire agreement is contained herein and that no warranties, guarantees,
statements, or representations shall be valid or binding on a party unless set
forth in this Contract. It is further understood and agreed that all prior
understandings and agreements heretofore had between the parties are merged in
this Contract which alone fully and completely expresses their agreement and
that the same is entered into after full investigation, neither party relying on
any statement or representation not embodied in this Contract. This Contract may
be changed, modified, altered or terminated only by a written agreement signed
by the parties hereto.
ARTICLE 10. Damage or Destruction: Condemnation: (a) In the event of partial
damage or destruction of the Property of a type which can, under the
circumstances, be expected in the reasonable judgment of Seller and Buyer to be
restored or repaired at a cost of $500,000 or less, then, this Contract shall be
consummated on the Closing Date at the Purchase Price, and unless such damage
has been repaired by Seller prior to Closing, Seller shall assign to Buyer the
casualty insurance proceeds payable to Seller and business interruption proceeds
applicable to the period on and after the Closing Date payable to Seller (but
only to the extent such business interruption proceeds are assignable to Buyer),
less any amounts expended by Seller for partial restoration and with a credit to
Buyer for the amount of any deductible and/or uninsured damage.
(b)    In the event that the Property shall have been damaged by fire or
casualty, the cost of repair or restoration of which would, in the reasonable
judgment of Seller and Buyer, exceed the sum of $500,000, then unless Seller has
previously repaired or restored the Property to its former condition, at Buyer’s
election, Seller shall either (i) pay over or assign to Buyer, on delivery of
the Deed all casualty insurance proceeds payable to Seller and business
interruption proceeds applicable to the period on and after the Closing Date
payable to Seller (but only to the extent such business interruption proceeds
are assignable to Buyer), less any amounts reasonably expended by Seller for
partial restoration, with a credit to Buyer for the amount of any deductible
and/or uninsured damage, or (ii) direct Escrow Agent to return the Deposit to
Buyer in which case, except for the Surviving Obligation, all other obligations
of the parties hereto shall cease and this Contract shall terminate and be
without further recourse or remedy to the parties hereto. Notwithstanding the
foregoing, if Buyer elects to proceed with the transaction under clause (i) of
this paragraph (b), in no event shall Seller be obligated to incur any out of
pocket cost above $500,000 (whether attributable to a casualty being uninsured,
underinsured or to any deductible).

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(c)    If all or part of the Property is taken by condemnation, eminent domain
or by agreement in lieu thereof, or any proceeding to acquire, take or condemn
all or part of the Property is threatened or commenced, Buyer may either
terminate this Contract (in which event Buyer shall be entitled to a return of
the Deposit and accrued interest thereon, if any, and, except for the Surviving
Obligations, all other obligations of the parties hereto shall cease and this
Contract shall terminate and be without further recourse or remedy to the
parties hereto) or close title to the Property in accordance with the terms
hereof, without reduction in the Purchase Price, together with an assignment of
Seller's rights to any award paid or payable by or on behalf of the condemning
authority. If Seller has received payments from the condemning authority and if
Buyer elects to close title to the Property, Seller shall credit the amount of
said payment against the Purchase Price at the Closing.
ARTICLE 11. Representations and Warranties of Seller: (a) In order to induce
Buyer to enter into this Contract and to consummate the purchase of the
Property, Seller hereby represents and warrants to Buyer as of the date of this
Contract and as of the Closing Date (updated to reflect the then state of facts)
as follows:
(i)
Seller is a limited liability company duly and validly organized and existing
and governed by the laws of the State of Delaware and qualified to do business
in the State of Illinois. This Contract and all documents that are to be
executed by Seller and delivered to Buyer at the Closing are, or at the time of
Closing will be, duly authorized, executed and delivered by Seller, and all
consents required under Seller's organizational documents or by law have been or
will have been obtained.

(ii)
To Seller’s actual knowledge, Exhibit C hereto (the "Rent Roll") is, in all
material respects, a true, complete and correct listing of all Leases in effect
as of a date not earlier than the last day of the month preceding the date of
this Contract at the Property. To Seller’s actual knowledge, except as set forth
in the Rent Roll, no tenant of any portion of the Property is in default in any
monetary obligation under its Lease.

(iii)
Seller has made available to Buyer true and complete copies of the Leases and
Operating Contracts, and all extensions, renewals and amendments thereto.

(iv)
To Seller’s actual knowledge, except as set forth in the Rent Roll, the rents
set forth in the Leases are being collected on a current basis and no tenant has
paid rent more than one (1) month in advance.

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(v)
To Seller’s actual knowledge, Exhibit I attached hereto is a complete list of
all management, service, supply and maintenance agreements, equipment leases,
and all other contracts and agreements with respect to or affecting the Property
as of the date of this Contract (herein collectively referred to as the
"Operating Contracts").

(vi)
To Seller’s actual knowledge and except as set forth in any reports delivered by
Seller to Buyer, Seller has not received any written notice from governmental
authorities advising Seller of, the presence, now or in the past, on, under or
affecting the Property of asbestos, mold, lead, radon or hazardous material,
waste or substances in violation of applicable law, which remains uncured. As
used in this Contract, hazardous material, waste or substances means material,
waste or substances which pose a serious hazard to human health and the use,
generation, processing, storage, release, discharge and presence thereof is
regulated by the State of Illinois or the United States of America.

(vii)
Except as set forth in Exhibit J hereto, there is not now pending nor to the
Seller’s actual knowledge, has there been threatened, any action, suit or
proceeding against or affecting Seller or the Property before or by any federal
or state court, commission, regulatory body, administrative agency or other
governmental body, domestic or foreign, wherein an unfavorable ruling, decision
or finding, upon consummation of the sale contemplated hereby to Buyer or
otherwise, may reasonably be expected to have a material adverse effect on the
business or prospects of or on the condition or operations of the Property, or
would interfere with Seller's ability to consummate the transactions by this
Contract.

(viii)
Seller is not a "foreign person" as defined by the Internal Revenue Code
("IRC"), Section 1445. Seller will execute and deliver to Buyer at Closing an
affidavit or certification in compliance with IRC Section 1445.

(ix)
To the best of Seller’s knowledge, neither Seller or any of its partners or
members, officers, directors or any brokers or other agents of same, have
engaged, on behalf of Seller or any of its affiliates, in any dealings or
transactions, directly or indirectly, (i) in contravention of any U.S.,
international or other money laundering regulations or conventions, including,
without limitation, the United States Bank Secrecy Act, the United States Money
Laundering Control Act of 1986, the United States International Money Laundering
Abatement and Anti-Terrorist

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Financing Act of 2001, Trading with the Enemy Act (50 U.S.C. §1 et seq., as
amended), or any foreign asset control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or existing order relating thereto, or (ii) in contravention of
executive Order No. 13224 dated September 24, 2001 issued by the President of
the United States (Executive Order Blocking Property and Prohibiting
Transactions with persons Who Commit, Threaten to Commit, or Support Terrorism),
as may be amended or supplemented from time to time (“Anti-Terrorism Order”) or
on behalf of terrorists or terrorist organizations, including those persons or
entities that are included on any relevant lists maintained by the United
Nations, North Atlantic Treaty Organization, Organization of Economic
Cooperation and Development, Financial Action Task Force, U.S. Office of Foreign
Assets Control, U.S. Central Intelligence Agency, U.S. Internal Revenue Service,
or any country or organization, all as may be amended from time to time. To the
best of Seller’s knowledge, neither Seller nor any of its partners or members
nor any brokers or other agents of same, on behalf of Seller or any of its
affiliates, (a) are or will be conducting any business or engaging in any
transaction with any person appearing on the U.S. Treasury Department's Office
of Foreign Assets Control list of restrictions and prohibited persons or (b) are
a person described in Section 1 of the Anti-Terrorism Order, and to the best of
Seller's knowledge neither Seller nor any of its affiliates have engaged in any
dealings or transactions with any such person.
(x)
No petition in bankruptcy (voluntary or otherwise), assignment for the benefit
of creditors, or petition seeking reorganization or arrangement or other action
under federal or state bankruptcy laws is pending against or contemplated by
Seller.

(b)    Any representations and warranties made to the actual knowledge of
Seller, such knowledge shall be deemed to be the current, conscious knowledge of
Patrick Gniadek, the Vice President for Investments, and Heather Duffey, the
Vice President for Property Operations for the region in which the Property is
located, without imputation of knowledge or duty of investigation or inquiry.
Seller hereby represents and warrants that Patrick Gniadek and Heather Duffey
are officers of Seller’s corporate parent with direct knowledge regarding the
matters represented to Seller’s actual knowledge herein. In addition, Seller
shall not be liable to Buyer for any representation or warranty which is untrue
at the time of Closing and with respect to which Buyer had knowledge thereof at
that time and Buyer’s sole remedy shall be to terminate this Contract and
receive a refund of the Deposit. Any claim (i) for a breach of representation
and warranty by Seller discovered by Buyer after Closing, (ii) for any breach of
any covenant by Seller that survives the Closing, or (iii) with respect to any
obligation, liability or indemnity of

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Seller under any of the documents delivered by Seller at the Closing (the
foregoing matters referred to in clauses (i), (ii) and (iii) being collectively
referred to as the “Surviving Claims”) must be commenced within six (6) months
after Closing and any damages or liability for such breach shall be limited to
Five Hundred Thousand Dollars ($500,000.00) in the aggregate, which sum shall be
Seller’s sole liability (the foregoing limits in amount of liability and
survival period being referred to herein as the “Indemnity Cap and Time Limit”).
The provisions of this paragraph shall run to the benefit of the named Buyer and
the buyer named in the Deed, and may not be assigned or enforced by any other
party.
ARTICLE 12. Operations: (a) Between the date hereof and the Closing, Seller
agrees hereby that it will maintain and rent the Property in its customary
manner. Until the Closing Date, Seller shall maintain insurance on the Premises
as currently insured.
(b)    Seller shall not remove any material item of the Personal Property from
the Property unless the same is obsolete and is replaced by tangible personal
property of equal or greater utility and value.
(c)    Seller shall not without the prior written consent of Buyer, which
consent shall not be unreasonably withheld, enter into any contract (but
excluding leases entered into in the ordinary course of business) which could
bind Buyer or the Property after the Closing unless the same is on market-rate
terms or better and may be canceled on thirty (30) days notice. Failure of Buyer
to respond within three (3) business days of written request from Seller for
consent shall be deemed consent by Buyer.
(d)    Seller, upon receipt of notice thereof, will give Buyer prompt notice of
the commencement prior to Closing of any litigation affecting the Property or
any part thereof which would impair Seller's right to sell the Property or be
binding upon Buyer.
(e)    At Closing, Seller shall send notice of termination as requested prior to
Closing by Buyer in writing prior to the end of the Due Diligence Period of any
Operating Contract which by its terms may be terminated by notice without
penalty or possible damages or liability for early termination. Any Operating
Contract for which notice of termination has been given, as requested by Buyer,
but which will not terminate until the expiration of any notice period shall be
assigned to Buyer, and, except as set forth below, all other Operating Contracts
shall be assigned to Buyer. Notwithstanding the foregoing, Buyer shall assume
the Operating Contract with Comcast for cable services. Buyer acknowledges that
(i) certain Operating Contracts are part of master agreements between Seller and
the respective vendor and cover other properties of Seller ("Master Agreements")
and (ii) certain Operating Contracts that are not Master Agreements require the
consent of the vendor to an assignment. Neither category of Operating Contracts
shall be assigned to Buyer (unless in the latter case the vendor has consented
to the assignment and released Seller from future liability under the Operating
Contract), but shall be terminated by Seller as of Closing.

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ARTICLE 13. Apportionment of Taxes and Other Charges: (a) All normal and
customarily proratable items, including without limitation, real and personal
property taxes, assessments, utility bills (except as hereinafter provided),
collected rents and other income, and Operating Contract payments for those
contracts that Buyer has elected or is required to assume pursuant to Article
12(e) above, Seller being charged and credited for all of the same relating to
the period up to the Closing Date and Buyer being charged and credited for all
of the same relating to the period on and after the Closing Date. With respect
to Operating Contracts that Buyer elects to terminate pursuant to Article 12(e)
above, Seller shall be responsible for any “stub period” payment between the
Closing Date and the effective date of termination. No proration shall be made
in relation to delinquent rents existing, if any, as of the Closing Date. In
adjusting for uncollected rents, no adjustment shall be made in Seller's favor
for rents which have accrued and are unpaid as of Closing, but Buyer shall pay
Seller such accrued and unpaid rents, as and when collected by Buyer, it being
agreed that Buyer shall not be deemed to have collected any such arrearages
attributable to the period prior to Closing until such time as the tenant is
current in the payment first of all rents accruing after the Closing. Buyer
agrees to bill tenants of the Property for all past due rents and to take any
additional reasonable actions requested by Seller to collect rents that are
accrued but unpaid as of the Closing, provided that Buyer shall not be obligated
to incur any out‑of‑pocket third party expense in connection with such actions
and Buyer shall not be obligated to take any action to terminate a tenancy.
Seller may not, subsequent to Closing, bring suit for recovery of delinquent
rents or possession of the premises occupied by delinquent tenants. Final
readings and final billings for utilities will be made if possible as of the
Closing Date, in which event no proration shall be made at the Closing with
respect to utility bills. One time non-recurring non-refundable charges such as
amenity fees, redecorating fees, pet fees, application fees and the like shall
not be prorated, provided that Buyer shall receive a credit for refundable fees
and deposits. Otherwise, a proration shall be made based upon the parties'
reasonable good faith estimate and a readjustment made within thirty (30) days
after Closing. No proration will be made in relation to insurance premiums and
the insurance policies will not be assigned to Buyer. Seller shall be entitled
to receive a return of all deposits presently in effect with the utility
providers, and Buyer shall be obligated to make its own arrangements for
deposits with the utility providers. Buyer shall receive a credit for all
Security Deposits, with interest thereon required by the Leases or by law (if
not transferred separately). Except as provided in the following sentence, the
provisions of this Article 13 shall survive the Closing for a period of ninety
(90) days at which time there will be a one time readjustment, if necessary. All
ad valorem real estate and personal property taxes with respect to the Real
Property and the Improvements shall be prorated as of the Closing Date on an
accrual basis. Accordingly, (i) Seller shall be responsible for the payment of
all such taxes for the tax year immediately preceding the calendar year in which
the Closing occurs (i.e., tax year 2011 if the Closing occurs in 2012), which
taxes are payable in the calendar year in which the Closing occurs (i.e., 2012),
and (ii) Seller and Buyer shall be responsible for their respective prorated
share of all such taxes for the tax year in which the Closing occurs (i.e.,
2012), which taxes are payable during the succeeding calendar year (i.e., 2013).
At Closing, Buyer shall receive a credit for the Sellers’ share of such taxes.
In the event that

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as of the date Closing occurs the actual tax bills for the tax year or years in
question are not available and the amount of tax to be prorated as aforesaid
cannot be ascertained, then 105% of the last determinable tax year shall be
used. After the Closing, once the final real estate tax bill for tax year 2011
is determined, there shall be a re-proration for tax years 2011 and for 2012
based on the final 2011 bill (which shall be used as the basis for proration for
both such tax years), but there shall not be any further re-proration of real
estate taxes for tax year 2012. All of Seller's on-site employees shall have
their employment with Seller terminated and shall be paid current through
Closing, including accrued vacation and other benefits.
(b)    Buyer shall receive a credit at Closing in the amount of $750 for each
unit which is vacant as of two (2) business days prior to the Closing Date, and
which has not been made ready for occupancy in a manner consistent with Seller’s
normal operating practices for the Property.
(c)    A detailed statement shall be prepared at the Closing setting forth the
manner of computation of the aforesaid pro‑ration adjustments.
ARTICLE 14. Broker: (a) Each party represents hereby to the other that it dealt
with no broker in the consummation of this Contract except for Holliday,
Fernoglio, Fowler, L.P. ("Broker"), and each party indemnifies the other from
any claim arising from the failure of such representation by the indemnifying
party.
(b)    Any commission due Broker shall be paid by Seller as provided in a
separate agreement, and Seller shall obtain and provide to Buyer a receipt from
such broker at Closing.
ARTICLE 15. Recording: It is agreed hereby that this Contract shall not be filed
for recording with any other governmental body.
ARTICLE 16. Notices. Any notice, consent or approval required or permitted to be
given under this Contract shall be in writing and shall be deemed to have been
given upon (i) hand delivery, (ii) one business day after being deposited with
Federal Express or another reliable overnight courier service for next day
deliver, (iii) upon facsimile transmission (except that if the date of such
transmission is not a business day, then such notice shall be deemed to be given
on the first business day following such transmission), or (iv) two business
days after being deposited in the United States mail, registered or certified
mail, postage prepaid, return receipt required, and addressed as follows:
To Seller:
c/o AvalonBay Communities, Inc.

Attention: Patrick Gniadek
Vice President, Investments
AvalonBay Communities, Inc.
Ballston Tower
671 N. Glebe Road, Suite 800

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Arlington, Virginia 22203
Telephone: 703-317-4781
Fax: 703-329-1459
pat_gniadek@avalonbay.com

With copies to:
c/o AvalonBay Communities, Inc.

Attention: Edward M. Schulman, Esq.
Senior Vice President and General Counsel
Ballston Tower
671 N. Glebe Road, Suite 800
Arlington, Virginia 22203
Telephone: (703) 317-4639
Fax: (703) 329-4830
Email: tschulman@avalonbay.com

And
Steven Schwartz, Esq.

Goulston & Storrs
400 Atlantic Avenue
Boston, Massachusetts 02110-3333
Telephone: (617) 574-4147
Fax: (617) 574-7636
SSchwartz@GOULSTONSTORRS.com

To Buyer:
Legacy Partners Residential LLC

Attention: Kerry Nicholson            
7525 SE 24th Street, Suite 180
Mercer Island, WA 98040
Telephone: (206) 275-4060
Fax: (206) 275-4059
Email: knicholson@legacypartners.com

With a copy to:
Anne Keeler Wright, Esq.

Schultz & Wright, LLP
545 Middlefield Road, #160
Menlo Park, CA 94025
Telephone: (650) 462-0900
Fax: (650) 462-0998
Email: wright@swllp.com

or such other address as either party may from time to time specify in writing
to the other. Notices delivered by legal counsel for a party shall be deemed
delivered by such party.

    

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ARTICLE 17. Captions: The captions in this Contract are inserted only for the
purpose of convenient reference and in no way define, limit or prescribe the
scope or intent of this Contract or any part hereof.
ARTICLE 18. Successors and Assigns:
(a) This Contract shall be binding upon the parties hereto and their respective
successors and assigns.
(b) Except with respect to an assignment to an “Affiliate” (as defined below),
Buyer may not assign this Contract without first obtaining Seller's written
consent, which may be granted or withheld in Seller’s sole discretion. Any
assignment in contravention of this provision shall be void. No assignment,
including an assignment to an Affiliate, shall release the Buyer herein named
from any obligation or liability accruing under this Contract prior to Closing;
provided, however, that any permitted assignment of this Contract by the Buyer
herein named shall release the Buyer herein named from any obligation or
liability accruing from and after Closing. Any assignee shall be deemed to have
made any and all representations and warranties made by Buyer hereunder, as if
the assignee were the original signatory hereto. For purposes of this Article
18, “Affiliate” shall mean (a) any entity which controls, is controlled by or is
under common management control with Buyer and/or (b) an entity that is a REIT
(as defined below)(or that is wholly owned directly or indirectly by a REIT) for
which Buyer or an affiliate of Buyer acts as the investment advisor and/or
co-sponsor and/or is a member of the sub-advisor for such REIT.
ARTICLE 19. Closing Costs: Except as hereinafter specifically provided, Seller
and Buyer shall allocate all closing costs between them in accordance with
standard practice in Chicago, Illinois. Each of Seller and Buyer shall be
responsible for preparing such documents as it is obligated to deliver pursuant
to Article 5 hereof and for its own legal expenses. Seller and Buyer agree to
allocate closing costs as follows:
(a)
State, County and City transfer taxes, stamp fees or the like shall be paid by
Seller.

(b)
Buyer's Title Policy expenses and premiums shall be paid by Seller; provided,
however, that if Buyer receives any endorsements or special coverages that
result in the premium exceeding $0.50 per thousand dollars of consideration, any
such excess shall be paid by Buyer.

(c)
Survey update expenses shall be paid by Buyer.

(d)
The cost of preparation and recordation of any releases and termination
statements required to clear title to the Property shall be paid by Seller.

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(e)
The cost of recordation of the Deed shall be paid by Buyer.

(f)
Escrow charges, if any, shall be split equally between Seller and Buyer.

ARTICLE 20. Governing Law: The laws of Illinois shall govern the validity,
construction, enforcement and interpretation of this Contract.
ARTICLE 21. Multiple Counterparts: This Contract may be executed in any number
of identical counterparts. If so executed, each of such counterparts shall
constitute this Contract. In proving this Contract, it shall not be necessary to
produce or account for more than one such counterpart.
ARTICLE 22. Representations and Warranties of Buyer: Buyer hereby represents and
warrants to Seller as of the date hereof and as of the Closing Date as follows:
(a)    This Contract and all documents executed by Buyer that are to be
delivered to Seller at the Closing are, or at the time of Closing will be, duly
authorized, executed and delivered by Buyer. This Contract and such documents
are, or at the Closing will be, legal, valid, and binding obligations of Buyer,
and do not, and, at the time of Closing will not, violate any provisions of any
agreement or judicial order to which Buyer is a party or to which it is subject.
(b)    There are no proceedings pending or, to Buyer's knowledge, threatened
against it in any court or before any governmental authority or any tribunal
which, if adversely determined, would have a material adverse effect on its
ability to purchase the Property or to carry out its obligations under this
Contract.
ARTICLE 23. Post‑Closing Obligations: (a) After the Closing, Seller and Buyer
shall cooperate with one another at reasonable times and on reasonable
conditions and shall execute and deliver such instruments and documents as may
be necessary in order fully to carry out the intent and purposes of the
transactions contemplated hereby. Except for such instruments and documents as
the parties were originally obligated to deliver by the terms of this Contract,
such cooperation shall be without additional cost or liability. The provisions
of this Article 23 shall survive Closing indefinitely.
ARTICLE 24. Duties and Responsibilities of Escrow Agent: Escrow Agent shall
deliver the Deposit to Seller or Buyer promptly after receiving a joint written
notice from Seller and Buyer directing the disbursement of the same, such
disbursement to be made in accordance with such direction. If Escrow Agent
receives written notice from Buyer or Seller that the party giving such notice
is entitled to the Deposit, which notice shall describe with reasonable
specificity the reasons for such entitlement, then Escrow Agent shall (i)
promptly give notice to the other party of Escrow Agent's receipt of such notice
and enclosing a copy of such notice and (ii) subject to the provisions of the
following paragraph which shall apply if a conflict arises, on the fourteenth
day after the giving of

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the notice referred to in clause (i) above, deliver the Deposit to the party
claiming the right to receive it.
In the event that Escrow Agent shall be uncertain as to its duties or actions
hereunder or shall receive instructions or a notice from Buyer or Seller which
are in conflict with instructions or a notice from the other party or which, in
the reasonable opinion of Escrow Agent, are in conflict with any of the
provisions of this Contract, it shall be entitled to take any of the following
courses of action:
(a)
Hold the Deposit as provided in this Contract and decline to take any further
action until Escrow Agent receives a joint written direction from Buyer and
Seller or any order of a court of competent jurisdiction directing the
disbursement of the Deposit, in which case Escrow Agent shall then disburse the
Deposit in accordance with such direction;

(b)
In the event of litigation between Buyer and Seller, Escrow Agent may deliver
the Deposit to the clerk of any court in which such litigation is pending; or

(c)
Escrow Agent may deliver the Deposit to a court of competent jurisdiction and
therein commence an action for interpleader, the cost thereof to Escrow Agent to
be borne by whichever of Buyer or Seller does not prevail in the litigation.

Escrow Agent shall not be liable for any action taken or omitted in good faith
and believed by it to be authorized or within the rights or powers conferred
upon it by this Contract and it may rely, and shall be protected in acting or
refraining from acting in reliance upon an opinion of counsel and upon any
directions, instructions, notice, certificate, instrument, request, paper or
other documents believed by it to be genuine and to have been made, sent, signed
or presented by the proper party or parties. In no event shall Escrow Agent's
liability hereunder exceed the aggregate amount of the Deposit. Escrow Agent
shall be under no obligation to take any legal action in connection with the
Deposit or this Contract or to appear in, prosecute or defend any action or
legal proceedings which would or might, in its sole opinion, involve it in cost,
expense, loss or liability unless, in advance, and as often as reasonably
required by it, Escrow Agent shall be furnished with such security and indemnity
as it finds reasonably satisfactory against all such cost, expense, loss or
liability. Notwithstanding any other provision of this Contract, Buyer and
Seller jointly indemnify and hold harmless Escrow Agent against any loss,
liability or expense incurred without bad faith on its part and arising out of
or in connection with its services under the terms of this Contract, including
the cost and expense of defending itself against any claim of liability.
Escrow Agent shall not be bound by any modification of this Contract affecting
Escrow Agent’s duties hereunder unless the same is in writing and signed by
Buyer, Seller and Escrow Agent. From time to time on or after the date hereof,
Buyer and Seller

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shall deliver or cause to be delivered to Escrow Agent such further documents
and instruments that fall due, or cause to be done such further acts as Escrow
Agent may reasonably request (it being understood that the Escrow Agent shall
have no obligation to make any such request) to carry out more effectively the
provisions and purposes of this Contract, to evidence compliance with this
Contract or to assure itself that it is protected in acting hereunder.
Escrow Agent shall be entitled to reimbursement for expenses incurred hereunder,
which expenses shall be paid and borne equally by Buyer and Seller, unless such
expenses are associated with litigation between Buyer and Seller, in which event
they shall be borne by the party that does not prevail in the litigation. Escrow
Agent agrees that it will not seek reimbursement for the services of its
employees or partners, but only for its actual and reasonably incurred
out‑of‑pocket expenses. Escrow Agent executes this Contract solely for the
purpose of consent to, and agreeing to be bound by the provisions of this
Article 24, and to the extent applicable to Escrow Agent, Article 3.
ARTICLE 25. WAIVER OF JURY TRIAL: EACH OF SELLER AND BUYER HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHT EITHER OR BOTH MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER OR IN CONNECTION WITH THIS CONTRACT OR ANY DOCUMENT CONTEMPLATED TO BE
EXECUTED IN CONJUNCTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF EITHER PARTY.
ARTICLE 26. ADDITIONAL OFFERS: Seller shall not have the right to negotiate and
accept “back up” offers for the Property or to enter into a purchase agreement
with any other third party during the term of this Contract.
ARTICLE 27. LIKE KIND EXCHANGE: Buyer agrees to cooperate reasonably with Seller
in effecting an exchange transaction which includes the Property pursuant to
Section 1031 of the United States Internal Revenue Code, provided that any
exchange initiated by Seller shall be at Seller’s sole cost and expense, not
cause Buyer to actually take title to any property other than the Property and
not delay the Closing. In addition, the Seller shall indemnify and hold Buyer
harmless from any and all cost, expense or liability incurred solely as a result
of Buyer accommodating such tax deferred exchange. The provisions of this
paragraph shall survive the Closing indefinitely.
ARTICLE 28. TIME OF THE ESSENCE. Time is of the essence of this Contract. As
used in this Contract, the term “business day” shall mean any day other than a
Saturday, Sunday or recognized federal holiday or a recognized state holiday of
the State of Illinois. If the last date for performance by either party under
this Contract occurs on a day which is not a business day, then the last date
for such performance shall be extended to the next occurring business day.

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ARTICLE 29. CONFIDENTIALITY. Unless Seller specifically and expressly otherwise
agrees in writing, Buyer agrees that (a) the results of all inspections,
analyses, studies and similar reports relating to the Property prepared by or
for Buyer utilizing any information acquired in whole or in part through the
exercise of Buyer's inspection right, and (b) all information regarding the
Property of whatsoever nature made available to Buyer by Seller or Seller's
agents or representatives (the "Proprietary Information"), is confidential and
shall not be disclosed to any other person except those assisting Buyer with the
transaction, or Buyer's lender, if any, and then only upon Buyer making such
persons aware of the confidentiality restriction. Notwithstanding the foregoing,
the Proprietary Information shall exclude any information or documentation that
(a) is readily ascertainable by the general public, (b) was known to Buyer prior
to the execution of this Contract, or (c) is required to be disclosed by
applicable law or court order. Buyer agrees not to use, or allow to be used, any
such information for any purpose other than to determine whether to proceed with
the contemplated purchase, or if same is consummated, in connection with the
operation of the Property post-closing. The provisions of this Article 29 shall
survive any termination of this Contract but shall not survive and shall
terminate in the event Buyer acquires the Property. In the event this Contract
is terminated, whether before or after the Due Diligence Expiration Date, Buyer
and its respective officers, directors, employees, consultants, advisors,
attorneys, and agents shall deliver to the Seller, upon request, all documents
and other materials, and all copies thereof, obtained from Seller or its agents
in connection with this Contract. By execution of this Contract, Escrow Agent
hereby agrees to maintain the existence of this Contract and the nature and
details of the transaction contemplated hereby in confidence, unless Escrow
Agent is required by law to disclose some or all of such information. Further
notwithstanding the foregoing, nothing contained herein shall impair Buyer's (or
its permitted assignee's) right to disclose information relating to this
Contract or the Property (a) to any due diligence representatives and/or
consultants that are engaged by, work for or are acting on behalf of, any
securities dealers and/or broker dealers evaluating Buyer or its permitted
assignees, (b) in connection with any filings (including any amendment or
supplement to any Form S-11 Registration Filing) with governmental agencies
(including the Securities and Exchange Commission (the “SEC”)) by any real
estate investment trust ("REIT") holding an interest (direct or indirect) in
Buyer or in any permitted assignee of Buyer, and (c) to any broker/dealers in
the REIT's broker/dealer network and any of the REIT's investors.
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IN WITNESS WHEREOF, the parties hereto have executed this Contract as an
instrument under seal as of the day and date first written above.

    
AVALON ILLINOIS VALUE II, LLC, a Delaware
limited liability company

By:    AvalonBay Value Added Fund, L.P.,     
a Delaware limited liability company, its
sole member

By:    AvalonBay Capital Management,
Inc., a Maryland corporation, its
general partner

By: /s/ Patrick Gniadek
Name:Patrick Gniadek
Title:
Vice President -

Investments

            

LEGACY PARTNERS RESIDENTIAL LLC,
a Delaware limited liability company

By:    /s/ Kerry L. Nicholson
Name:Kerrry L. Nicholson
Title:Senior Managing Director

FIRST AMERICAN TITLE
INSURANCE COMPANY

By:    /s/ Jeremy C. Poetker
Name:Jeremy C. Poetker
Title:Sr Comm Underwriter