Exhibit 10.2

FIXED FACILITY NOTE

(Standard Maturity)

 

US $310,000,000.00    April 7, 2009

FOR VALUE RECEIVED, the undersigned (individually and collectively, “Borrower”)
jointly and severally (if more than one) promises to pay to the order of
DEUTSCHE BANK BERKSHIRE MORTGAGE, INC., a Delaware corporation (“Lender”) the
principal sum of THREE HUNDRED TEN MILLION AND NO/100 DOLLARS (US
$310,000,000.00), with interest accruing on the unpaid principal balance from
the Disbursement Date until fully paid at the Interest Rate.

This Note is executed and delivered by Borrower pursuant to that certain Master
Credit Facility Agreement, dated as of April 7, 2009, by and between Borrower,
Lender and others (as amended, restated or otherwise modified from time to time,
the “Master Agreement”), to evidence the obligation of Borrower to repay a Fixed
Advance made by Lender to Borrower in accordance with the terms of the Master
Agreement. This Note is entitled to the benefit and security of the Loan
Documents provided for in the Master Agreement, to which reference is hereby
made for a statement of all of the terms and conditions under which the Fixed
Advance evidenced hereby is made.

1. Defined Terms. In addition to defined terms found elsewhere in this Note, as
used in this Note, the following definitions shall apply:

Advance: The advance evidenced by this Note.

Advance Term: 120 months.

Amortization Period: 360 months.

Business Day: Any day other than a Saturday, Sunday or any other day on which
Lender is not open for business.

Debt Service Amounts: Amounts payable under this Note, the Security Instrument
or any other Loan Document.

Default Rate: A rate equal to the lesser of 4 percentage points above the
Interest Rate or the maximum interest rate which may be collected from Borrower
under applicable law.

Disbursement Date: The date of disbursement of Advance proceeds hereunder.

First Interest Only Payment Date: The first day of June, 2009.

First Principal and Interest Payment Date: The first day of June, 2014.

Indebtedness: The principal of, interest on, or any other amounts due at any
time under, this Note, the Security Instrument or any other Loan Document,
including prepayment premiums, late charges, default interest, and advances to
protect the security of the Security Instrument under Section 12 of the Security
Instrument.

 

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Interest Only Term: 60 months.

Interest Rate: The annual rate of five and fifty-seven one hundredths percent
(5.57%).

Last Interest Only Payment Date: The first day of May, 2014.

Lender: The holder of this Note.

Maturity Date: The first day of May, 2019, or any earlier date on which the
unpaid principal balance of this Note becomes due and payable by acceleration or
otherwise.

Security Instrument: Individually and collectively, various multifamily
mortgages, deeds to secure debt or deeds of trust described in the Master
Agreement.

Yield Maintenance Period Term or Prepayment Premium Period Term: 114 months.

Yield Maintenance Period End Date or Prepayment Premium Period End Date: The
last day of October, 2018.

Event of Default and other capitalized terms used but not defined in this Note
shall have the meanings given to such terms in the Master Agreement or, if not
defined in the Master Agreement, as defined in the Security Instrument.

2. Address for Payment. All payments due under this Note shall be payable at c/o
DB Mortgage Services, LLC, One Beacon Street, 14th Floor, Boston, Massachusetts
02108, or such other place as may be designated by written notice to Borrower
from or on behalf of Lender.

3. Payment of Principal and Interest. Principal and interest shall be paid as
follows:

(a) Short Month Interest. If disbursement of principal is made by Lender to
Borrower on any day other than the first day of the month, interest for the
period beginning on the Disbursement Date and ending on and including the last
day of the month in which such disbursement is made shall be payable
simultaneously with the execution of this Note.

(b) Interest Computation. Interest under this Note shall be computed on the
basis of (check one only):

 

  ¨ 30/360. A 360-day year consisting of twelve 30-day months.

 

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  x Actual/360. A 360-day year. The amount of each monthly payment made by
Borrower pursuant to Section 3(c) below that is allocated to interest will be
based on the actual number of calendar days during such month and shall be
calculated by multiplying the unpaid principal balance of this Note by the per
annum Interest Rate, dividing the product by three hundred sixty (360) and
multiplying the quotient by the actual number of days elapsed during the month.
Borrower understands that the amount of interest for each month will vary
depending on the actual number of calendar days during such month.

(c) Monthly Installments (check one only):

(1) Interest Only Period. Commencing on the First Interest Only Payment Date and
on the first day of every month until and including the Last Interest Only
Payment Date, consecutive monthly installments of interest only shall be payable
and in an amount equal to one of the following (check one only):

 

  ¨ 30/360. [Select only if 30/360 is selected in Section 3(b) above.] If
interest accrues based on a 30/360 interest computation, then consecutive
monthly installments of interest only, each in the amount of
                                         
                                         
                                            Dollars (US
$                                         ).

 

  x Actual/360. [Select only if Actual/360 is selected in Section 3(b) above.]
If interest accrues based on an Actual/360 interest computation, the amount of
One Million Four Hundred Thirty-Eight Thousand Nine Hundred Sixteen and 67/100
Dollars (US $1,438,916.67) shall be payable on the First Interest Only Payment
Date and thereafter consecutive monthly installments of interest only, shall be
payable as follows:

 

  (1) One Million Three Hundred Forty-Two Thousand Nine Hundred Eighty-Eight and
89/100 Dollars (US $1,342,988.89), shall be payable on the first day of each
month during the term hereof which follows a 28-day month;

 

  (2) One Million Three Hundred Ninety Thousand Nine Hundred Fifty-Two and
78/100 Dollars (US $1,390,952.78), shall be payable on the first day of each
month during the term hereof which follows a 29-day month,

 

  (3) One Million Four Hundred Thirty-Eight Thousand Nine Hundred Sixteen and
67/100 Dollars (US $1,438,916.67), shall be payable on the first day of each
month during the term hereof which follows a 30-day month, or

 

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  (4) One Million Four Hundred Eighty-Six Thousand Eight Hundred Eighty and
56/100 Dollars (US $1,486,880.56), shall be payable on the first day of each
month during the term hereof which follows a 31-day month,

until the entire unpaid principal balance evidenced by this Note is fully paid.

(2) Amortizing Period. Commencing on the First Principal and Interest Payment
Date and on the first day of every month thereafter, consecutive monthly
installments of principal and interest, each in the amount of One Million Seven
Hundred Seventy-Three Thousand Seven Hundred Eighty Four and 87/100 Dollars (US
$1,773,784.87) until the entire unpaid principal balance evidenced by this Note
is fully paid. Any remaining principal and interest shall be due and payable on
the Maturity Date. The unpaid principal balance shall continue to bear interest
after the Maturity Date at the Default Rate set forth in this Note until and
including the date on which it is paid in full.

(d) Payments Before Due Date. Any regularly scheduled monthly installment of
interest only (during the interest-only period set forth in paragraph 3(c)
above) or principal and interest (during the period in which principal and
interest is due also as set forth in paragraph 3(c) above) that is received by
Lender before the date it is due shall be deemed to have been received on the
due date solely for the purpose of calculating interest due.

(e) Accrued Interest. Any accrued interest remaining past due for thirty
(30) days or more shall be added to and become part of the unpaid principal
balance and shall bear interest at the rate or rates specified in this Note. Any
reference herein to “accrued interest” shall refer to accrued interest which has
not become part of the unpaid principal balance. Any amount added to principal
pursuant to the Loan Documents shall bear interest at the applicable rate or
rates specified in this Note and shall be payable with such interest upon demand
by Lender and absent such demand, as provided in this Note for the payment of
principal and interest.

4. Application of Payments. If at any time Lender receives, from Borrower or
otherwise, any amount applicable to the Indebtedness which is less than all
amounts due and payable at such time, Lender may apply that payment to amounts
then due and payable in any manner and in any order determined by Lender, in
Lender’s discretion. Borrower agrees that neither Lender’s acceptance of a
payment from Borrower in an amount that is less than all amounts then due and
payable nor Lender’s application of such payment shall constitute or be deemed
to constitute either a waiver of the unpaid amounts or an accord and
satisfaction.

5. Security. The Indebtedness is secured, among other things, by the Security
Instrument, and reference is made to the Security Instrument for other rights of
Lender concerning the collateral for the Indebtedness.

6. Acceleration. If an Event of Default has occurred and is continuing, the
entire unpaid principal balance, any accrued interest, the prepayment premium
payable under Section 10, if any, and all other amounts payable under this Note
and any other Loan Document shall at once become due and payable, at the option
of Lender, without any prior notice to Borrower. Lender may exercise this option
to accelerate regardless of any prior forbearance.

 

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7. Late Charge. If any monthly installment due hereunder is not received by
Lender on or before the 5th day of each month or if any other amount payable
under this Note or under the Security Instrument or any other Loan Document is
not received by Lender within 5 days after the date such amount is due, counting
from and including the date such amount is due, Borrower shall pay to Lender,
immediately and without demand by Lender, a late charge equal to 5 percent of
such monthly installment or other amount due. Borrower acknowledges that its
failure to make timely payments will cause Lender to incur additional expenses
in servicing and processing the Advance and that it is extremely difficult and
impractical to determine those additional expenses. Borrower agrees that the
late charge payable pursuant to this Section represents a fair and reasonable
estimate, taking into account all circumstances existing on the date of this
Note, of the additional expenses Lender will incur by reason of such late
payment. The late charge is payable in addition to, and not in lieu of, any
interest payable at the Default Rate pursuant to Section 8.

8. Default Rate. So long as any monthly installment or any other payment due
under this Note remains past due for thirty (30) days or more, interest under
this Note shall accrue on the unpaid principal balance from the earlier of the
due date of the first unpaid monthly installment or other payment due, as
applicable, at the Default Rate. If the unpaid principal balance and all accrued
interest are not paid in full on the Maturity Date, the unpaid principal balance
and all accrued interest shall bear interest from the Maturity Date at the
Default Rate. Borrower also acknowledges that its failure to make timely
payments will cause Lender to incur additional expenses in servicing and
processing the Advance, that, during the time that any monthly installment or
payment under this Note is delinquent for more than thirty (30) days, Lender
will incur additional costs and expenses arising from its loss of the use of the
money due and from the adverse impact on Lender’s ability to meet its other
obligations and to take advantage of other investment opportunities, and that it
is extremely difficult and impractical to determine those additional costs and
expenses. Borrower also acknowledges that, during the time that any monthly
installment or other payment due under this Note is delinquent for more than
thirty (30) days, Lender’s risk of nonpayment of this Note will be materially
increased and Lender is entitled to be compensated for such increased risk.
Borrower agrees that the increase in the rate of interest payable under this
Note to the Default Rate represents a fair and reasonable estimate, taking into
account all circumstances existing on the date of this Note, of the additional
costs and expenses Lender will incur by reason of Borrower’s delinquent payment
and the additional compensation Lender is entitled to receive for the increased
risks of nonpayment associated with a delinquent advance.

 

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9. Limits on Personal Liability. The provisions of Article 14 of the Master
Agreement (entitled “Limits on Personal Liability”) are hereby incorporated into
this Note by this reference to the fullest extent as if the text of such Article
were set forth in its entirety herein.

10. Voluntary and Involuntary Prepayments.

(a) A prepayment premium shall be payable in connection with any prepayment made
under this Note as provided below:

(1) Subject to the terms of the Master Agreement, Borrower may voluntarily
prepay all (or a portion) of the unpaid principal balance of this Note only on
the last calendar day of a calendar month (the “Last Day of the Month”) and only
if Borrower has complied with all of the following:

 

  (i) Borrower must give Lender at least thirty (30) days (if given via U.S.
Postal Service) or twenty (20) days (if given via facsimile, email or overnight
courier), but not more than sixty (60) days, prior written notice of Borrower’s
intention to make a prepayment (the “Prepayment Notice”). The Prepayment Notice
shall be given in writing (via facsimile, email, U.S. Postal Service or
overnight courier) and addressed to Lender. The Prepayment Notice shall include,
at a minimum, the Business Day upon which Borrower intends to make the
prepayment (the “Intended Prepayment Date”).

 

  (ii) Borrower acknowledges that the Lender is not required to accept any
voluntary prepayment of this Note on any day other than the Last Day of the
Month even if Borrower has given a Prepayment Notice with an Intended Prepayment
Date other than the Last Day of the Month or if the Last Day of the Month is not
a Business Day. Therefore, even if Lender accepts a voluntary prepayment on any
day other than the Last Day of the Month, for all purposes (including the
accrual of interest and the calculation of the prepayment premium), any
prepayment received by Lender on any day other than the Last Day of the Month
shall be deemed to have been received by Lender on the Last Day of the Month and
any prepayment calculation will include interest to and including the Last Day
of the Month in which such prepayment occurs. If the Last Day of the Month is
not a Business Day, then Borrower must make the payment on the Business Day
immediately preceding the Last Day of the Month.

 

  (iii) Any prepayment shall be made by paying (A) the amount of principal being
prepaid, (B) all accrued interest (calculated to the Last Day of the Month),
(C) all other sums due Lender at the time of such prepayment, and (D) the
prepayment premium calculated pursuant to Schedule A.

 

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  (iv) If, for any reason, Borrower fails to prepay this Note (A) within five
(5) Business Days after the Intended Prepayment Date or (B) if the prepayment
occurs in a month other than the month stated in the original Prepayment Notice,
then Lender shall have the right, but not the obligation, to recalculate the
prepayment premium based upon the date that Borrower actually prepays this Note
and to make such calculation as described in Schedule A attached hereto. For
purposes of such recalculation, such new prepayment date shall be deemed the
“Intended Prepayment Date.”

(2) Upon Lender’s exercise of any right of acceleration under this Note,
Borrower shall pay to Lender, in addition to the entire unpaid principal balance
of this Note outstanding at the time of the acceleration, (i) all accrued
interest and all other sums due Lender under this Note and the other Loan
Documents, and (ii) the prepayment premium calculated pursuant to Schedule A.

(3) Any application by Lender of any collateral or other security to the
repayment of any portion of the unpaid principal balance of this Note prior to
the Maturity Date and in the absence of acceleration shall be deemed to be a
partial prepayment by Borrower, requiring the payment to Lender by Borrower of a
prepayment premium.

(b) Notwithstanding the provisions of Section 10(a), no prepayment premium shall
be payable (1) with respect to any prepayment occurring as a result of the
application of any insurance proceeds or condemnation award under the Security
Instrument, or (2) as provided in subparagraph (c) of Schedule A.

(c) Schedule A is hereby incorporated by reference into this Note.

(d) Any required prepayment of less than the entire unpaid principal balance of
this Note shall not extend or postpone the due date of any subsequent monthly
installments or change the amount of such installments, unless Lender agrees
otherwise in writing.

(e) Borrower recognizes that any prepayment of the unpaid principal balance of
this Note, whether voluntary or involuntary or resulting from a default by
Borrower, will result in Lender’s incurring loss, including reinvestment loss,
additional expense and frustration or impairment of Lender’s ability to meet its
commitments to third parties. Borrower agrees to pay to Lender upon demand
damages for the detriment caused by any prepayment, and agrees that it is
extremely difficult and impractical to ascertain the extent of such damages.
Borrower therefore acknowledges and agrees that the formula for calculating
prepayment premiums set forth on Schedule A represents a reasonable estimate of
the damages Lender will incur because of a prepayment.

(f) Borrower further acknowledges that the prepayment premium provisions of this
Note are a material part of the consideration for the Advance evidenced by this
Note, and acknowledges that the terms of this Note are in other respects more
favorable to Borrower as a result of Borrower’s voluntary agreement to the
prepayment premium provisions.

 

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11. Costs and Expenses. Borrower shall pay on demand all expenses and costs,
including fees and out-of-pocket expenses of attorneys and expert witnesses and
costs of investigation, incurred by Lender as a result of any default under this
Note or in connection with efforts to collect any amount due under this Note, or
to enforce the provisions of any of the other Loan Documents, including those
incurred in post-judgment collection efforts and in any bankruptcy proceeding
(including any action for relief from the automatic stay of any bankruptcy
proceeding) or judicial or non-judicial foreclosure proceeding.

12. Forbearance. Any forbearance by Lender in exercising any right or remedy
under this Note, the Security Instrument, or any other Loan Document or
otherwise afforded by applicable law, shall not be a waiver of or preclude the
exercise of that or any other right or remedy. The acceptance by Lender of any
payment after the due date of such payment, or in an amount which is less than
the required payment, shall not be a waiver of Lender’s right to require prompt
payment when due of all other payments or to exercise any right or remedy with
respect to any failure to make prompt payment. Enforcement by Lender of any
security for Borrower’s obligations under this Note shall not constitute an
election by Lender of remedies so as to preclude the exercise of any other right
or remedy available to Lender.

13. Waivers. Except as expressly provided in the Master Agreement, presentment,
demand, notice of dishonor, protest, notice of acceleration, notice of intent to
demand or accelerate payment or maturity, presentment for payment, notice of
nonpayment, grace, and diligence in collecting the Indebtedness are waived by
Borrower and all endorsers and guarantors of this Note and all other third party
obligors.

14. Advance Charges. Borrower agrees to pay an effective rate of interest equal
to the sum of the Interest Rate provided for in this Note and any additional
rate of interest resulting from any other charges of interest or in the nature
of interest paid or to be paid in connection with the Advance evidenced by this
Note and any other fees or amounts to be paid by Borrower pursuant to any of the
other Loan Documents. Neither this Note nor any of the other Loan Documents
shall be construed to create a contract for the use, forbearance or detention of
money requiring payment of interest at a rate greater than the maximum interest
rate permitted to be charged under applicable law. If any applicable law
limiting the amount of interest or other charges permitted to be collected from
Borrower in connection with the Advance is interpreted so that any interest or
other charge provided for in any Loan Document, whether considered separately or
together with other charges provided for in any other Loan Document, violates
that law, and Borrower is entitled to the benefit of that law, that interest or
charge is hereby reduced to the extent necessary to eliminate that violation.
The amounts, if any, previously paid to Lender in excess of the permitted
amounts shall be applied by Lender to reduce the unpaid principal balance of
this Note. For the purpose of determining whether any applicable law limiting
the amount of interest or other charges permitted to be collected from Borrower
has been violated, all Indebtedness that constitutes interest, as well as all
other charges made in connection with the Indebtedness that constitute interest,
shall be deemed to be allocated and spread ratably over the stated term of the
Note. Unless otherwise required by applicable law, such allocation and spreading
shall be effected in such a manner that the rate of interest so computed is
uniform throughout the stated term of the Note.

 

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15. Commercial Purpose. Borrower represents that the Indebtedness is being
incurred by Borrower solely for the purpose of carrying on a business or
commercial enterprise, and not for personal, family or household purposes.

16. Counting of Days. Except where otherwise specifically provided, any
reference in this Note to a period of “days” means calendar days, not Business
Days.

17. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. The provisions
of Section 15.06 of the Master Agreement (entitled “Choice of Law; Consent to
Jurisdiction; Waiver of Jury Trial”) are hereby incorporated into this Note by
this reference to the fullest extent as if the text of such Section were set
forth in its entirety herein.

18. Captions. The captions of the paragraphs of this Note are for convenience
only and shall be disregarded in construing this Note.

19. Notices. All notices, demands and other communications required or permitted
to be given by Lender to Borrower pursuant to this Note shall be given in
accordance with Section 15.08 of the Master Agreement.

20. Security for this Note. The indebtedness evidenced by this Note is secured
by other Security Documents executed by Borrower or its Affiliates. Reference is
made hereby to the Master Agreement and the Security Documents for additional
rights and remedies of Lender relating to the Indebtedness evidenced by this
Note. Each Security Document shall be released in accordance with the provisions
of the Master Agreement and the Security Documents.

21. No Reborrowing. Advances borrowed under this Note may not be reborrowed.

22. Fixed Advance. This Note is issued to evidence a Fixed Advance made in
accordance with the terms of the Master Agreement.

23. Cross-Default with Master Agreement. The occurrence of an Event of Default
under the Master Agreement shall constitute an “Event of Default” under this
Note, and, accordingly, upon the occurrence of an Event of Default under the
Master Agreement, the entire principal amount outstanding hereunder and accrued
interest thereon shall at once become due and payable, at the option of the
holder hereof.

[Remainder of page intentionally left blank.]

 

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IN WITNESS WHEREOF, Borrower has signed and delivered this Note under seal or
has caused this Note to be signed and delivered under seal by its duly
authorized representative. Borrower intends that this Note shall be deemed to be
signed and delivered as a sealed instrument.

 

BORROWER: BRE–FMCA, LLC, a Delaware limited liability company By:   BRE
Properties, Inc., a Maryland corporation, its sole member   By:   /s/ Edward F.
Lange, Jr.   Name:   Edward F. Lange, Jr.   Its:  

Executive Vice President and

Chief Operating Officer

BRE–FMAZ, LLC, a Delaware limited liability company By:   BRE Property Investors
LLC, a Delaware limited liability company, its sole member   By:   BRE
Properties, Inc., a Maryland corporation, its managing member     By:   /s/
Edward F. Lange, Jr.     Name:   Edward F. Lange, Jr.     Its:  

Executive Vice President and

Chief Operating Officer

 

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Pay to the order of                                          
                                         
                                                               , without
recourse.

 

LENDER: DEUTSCHE BANK BERKSHIRE MORTGAGE, INC., a Delaware corporation By:   /s/
Heidi Marrin Name:   Heidi Marrin Title:   Assistant Vice President By:   /s/
Jeffrey C. Day Name:   Jeffrey C. Day Title:   Managing Director

 

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ATTACHED SCHEDULES. The following Schedules are attached to this Note:

 

  x Schedule A     Prepayment Premium (required)

 

  ¨ Schedule B     Modifications to Multifamily Note

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SCHEDULE A

PREPAYMENT PREMIUM

Any prepayment premium payable under Section 10 of this Note shall be computed
as follows:

 

  (a) If the prepayment is made at any time after the date of this Note and
before the Yield Maintenance Period End Date, the prepayment premium shall be
the greater of:

 

  (i) one percent (1%) of the amount of principal being prepaid; or

 

  (ii) The product obtained by multiplying:

 

  (A) the amount of principal being prepaid,

by

 

  (B) the difference obtained by subtracting from the Interest Rate on this Note
the yield rate (the “Yield Rate”) on the 3.7500% U.S. Treasury Security due
November 2018 (the “Specified U.S. Treasury Security”), on the twenty-fifth
(25th) Business Day preceding (x) the Intended Prepayment Date, or (y) the date
Lender accelerates the Advance or otherwise accepts a prepayment pursuant to
Section 10(a)(3) of this Note, as the Yield Rate is reported in The Wall Street
Journal,

by

 

  (C) the present value factor calculated using the following formula:

 

1 - (1+ r)-n/12    r   

[r = Yield Rate

n = the number of months remaining between (1) either of the following: (x) in
the case of a voluntary prepayment, the Last Day of the Month during which the
prepayment is made, or (y) in any other case, the date on which Lender
accelerates the unpaid principal balance of this Note and (2) the Yield
Maintenance Period End Date]

In the event that no Yield Rate is published for the Specified U.S. Treasury
Security, then the nearest equivalent non-callable U.S. Treasury Security having
a maturity date closest to the Yield

 

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Maintenance Period End Date of this Note shall be selected at Lender’s
discretion. If the publication of such Yield Rates in The Wall Street Journal is
discontinued, Lender shall determine such Yield Rates from another source
selected by Lender.

 

  (b) If the prepayment is made on or after the Yield Maintenance Period End
Date but before the last calendar day of the fourth (4th) month prior to the
month in which the Maturity Date occurs, the prepayment premium shall be one
percent (1%) of the amount of principal being prepaid.

 

  (c) Notwithstanding the provisions of Section 10(a) of this Note, no
prepayment premium shall be payable with respect to any prepayment made on or
after the last calendar day of the fourth (4th) month prior to the month in
which the Maturity Date occurs.

[Remainder of page intentionally left blank.]

 

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[Initial Page to Schedule A to Fixed Facility Note (Standard Maturity)]

 

/s/ EL INITIALS