exv10w7






Exhibit 10.7




PURCHASE AGREEMENT




     THIS PURCHASE AGREEMENT (“Agreement”) is made as of the 25th day of March 2010, by and between
CHICAGO TITLE LAND TRUST COMPANY, as Trustee under Trust Number 51-0615-0 dated August 15, 1967, an
Illinois Land Trust by Towne Realty, Inc. d/b/a Lincoln Tower, Inc., as authorized beneficiary
(“Seller”), and STEADFAST ASSET HOLDINGS, INC., a California corporation, or its assigns (“Buyer”).



RECITALS




     A. Seller owns certain real property located at 520 South Second Street, Springfield, Illinois
that Seller is in the process of converting to a two (2) unit mixed-use condominium development
known as “Lincoln Tower Mixed Use Condominium” (“Condominium”). The Condominium is comprised of
two (2) condominium units: one (1) 5-story office building (“Unit 1”) and one (1) 16-story
multi-family residential apartment building with some surface parking, covered parking and garage
parking (“Unit 2”).



     B. Buyer desires to purchase Unit 2, comprised of the 16-story residential apartment building
which shall, as of Closing, consist of one hundred ninety (190) residential apartments and nine (9)
non-residential units, with some surface parking, covered parking and garage, along with Seller’s
undivided interest in the common elements and limited common elements appurtenant to Unit 2,
together with and subject to the rights, interests, obligations and limitations set forth in the
declaration and condominium plat (and all amendments thereto) creating the Condominium as described
on Exhibit A attached hereto, together with all appurtenant hereditaments, tenements, buildings,
structures or other improvements, and easements, and privileges and issues relating thereto
(collectively hereinafter Unit 2 described above “Real Property”).



     C. Seller has agreed to sell and Buyer has agreed to purchase the Property (as defined below)
in accordance with and subject to the terms and conditions of this Agreement.



AGREEMENT




     Now therefore, for good and valuable consideration, the receipt and adequacy of which is
acknowledged, the parties agree as follows:



1. BASIC PROVISIONS




     The following words and phrases are defined for subsequent use in this Agreement:



     1.1. Closing. Subject to the express provisions hereof, the consummation of the
transaction contemplated by this Agreement (“Closing”) shall occur, if at all, on a date selected
by Buyer with prior reasonable notice to Seller, which date shall be no later than sixty (60) days
after the expiration of the Condominium Document Review Period (defined below), and shall occur by
mail through the offices of the Title Company (defined below). Buyer may, at Buyer’s request,
extend the Closing one time for up to thirty (30) days beyond the initial Closing date, upon notice
to Seller.



     1.2. Commitment. A commitment for a standard ALTA 2006 owner’s policy of title
insurance (with arbitration clause deleted and containing such endorsements at Buyer’s sole cost as
Buyer may request (except for endorsements required to address a title objection, which shall be at
Seller’s expense)) with respect to the
Real Property in the amount of the Purchase Price committing the Title Company to insure Buyer
as the fee



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simple owner of the Real Property, without standard exceptions and subject only to the
Permitted Exceptions (defined below).




     1.3. Conditions. The conditions precedent to Buyer’s obligation to purchase the
Property, which conditions are as follows:



                    (i) Physical/Financial Review Condition. Buyer’s satisfaction in its sole and absolute
discretion, with all physical aspects of the Real Property, including, but not limited to, its
environmental condition, structural condition, the condition of the roof and the HVAC system and
the condition of all parking, drive, walkway and landscaped areas, all aspects of the common
elements and the limited common elements, and off-site improvements, if any, appurtenant thereto,
drainage, soils, and access and utilities availability and capacity, and Buyer’s satisfaction, in
its sole and absolute discretion, with the revenue generated or to be generated from the Property
and the expenses incurred and to be incurred in the operation and maintenance of the Property and
all other development, marketing, economic and other matters relating to the Property (other than
the Title Condition, which shall be as provided herein);



                    (ii) Title Condition. Buyer’s satisfaction with the state of title to the Real
Property, in accordance with Section 3.6 below; and



                    (iii) Condominium Documents. Buyer’s satisfaction in its sole and absolute
discretion, with the proposed Condominium Documents.



     1.4. Condominium Document Review Period. The period commencing on the Effective Date
and concluding at 4:00 p.m. Central Standard Time sixty (60) days thereafter.



     1.5. Condominium Documents. The final recorded Declaration of Condominium, final
recorded Condominium Plat, the final bylaws, related easements, all association documents, and any
other documents necessary to the creation of the Condominium or operation of Unit 2.



     1.6 Contracts. All of those contracts between Seller and/or its manager, on the one
hand, and service and/or materials providers, on the other hand, which contracts relate to the
ownership, operation, maintenance or use of the Property.



     1.7. Deposit. Two Hundred Thousand and 00/100 Dollars ($200,000.00), together with
interest earned thereon in accordance with the terms hereof.




     1.8. Effective Date. The date on which the last of Buyer and Seller execute this
Agreement, as such date is set forth on the signature page hereto.





     1.9. Inspection Period. The period commencing on the Effective Date and concluding at
4:00 p.m. Central Standard Time thirty (30) days thereafter.



     1.10. Lease or Leases. As the context dictates, individually or collectively, a
lease, license, or other written permission to occupy any portion of the Real Property, for parking
at, on or in connection with the Real Property, or for any cell tower.



     1.11. Permitted Exceptions. The encumbrances or exceptions to title shown in the
Commitment to which Buyer does not object pursuant to the terms hereof or which, with Buyer’s prior
written consent, are waived and accepted or satisfactorily insured over in accordance with the
terms of Section 3.6 hereof.



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     1.12. Personal Property. Those items listed on Exhibit B attached hereto and
incorporated herein by reference, and all of Seller’s interest (to the fullest extent assignable)
in any other tangible and intangible personal property located upon the Real Property and/or used
in connection therewith, including without limitation goods, equipment, machinery, furniture,
furnishings, plans, specifications, surveys, condemnation awards, licenses, permits, warranties and
guarantees.



     1.13. Property. The Real Property, the Contracts that Buyer elects to assume as shall
be set forth on the bill of sale to be delivered pursuant to Section 5.2(iii), the Seller’s
interest in the Condominium Documents relating to Unit 2, the Leases, rents, profits, licenses,
Personal Property, the Trade Name, and the Seller’s interest, if any, in the following: all plants,
shrubs, and trees located on the Real Property, all fixtures attached or affixed, actually or
constructively, to the Real Property, all air space, vault and subterranean space benefitting or
appurtenant to the Real Property, all oil, gas and mineral rights and royalties and water rights
and entitlements, and all land lying in the bed of any street, road, avenue or alley, proposed,
open or closed, adjoining the Real Property.



     1.14. Purchase Price. Ten Million Three Hundred Fifty Thousand and 00/100 Dollars
($10,350,000.00).



     1.15. Representations. The representation and warranties as set forth on Exhibit C
attached hereto and incorporated herein by reference or otherwise made herein.



     1.16. Seller Debts. Seller Debts are the debts, liabilities, taxes, obligations and
claims for which Seller alone is liable and shall include (a) all payments and benefits to past
and/or present employees of Seller in connection with the business being conducted on or from the
Real Property as may have accrued through Closing, (including, but not limited to, salaries, wages,
commissions, bonuses, vacation pay, health and welfare contributions, pensions, profit sharing,
severance or termination pay, or any other form of compensation or fringe benefit), (b)
obligations of Seller under any Leases or occupancy agreements accruing prior to Closing, and (c)
obligations of Seller under the Contracts. Seller shall be fully responsible for and shall
indemnify, defend and hold Buyer harmless with respect to all of Seller Debts and all of the
operations of Seller’s business from the Real Property prior to Closing including, but not limited
to all suits, actions, damages and claims which may be asserted or threatened against Buyer from
and after Closing, but which shall have arisen out of any aspect of the business or its operations
prior to Closing. Buyer shall be fully responsible for and shall indemnify, defend and hold Seller
harmless with respect to all operations of Buyer’s business from the Real Property after Closing
but shall have no liability for any of Seller Debts. The provisions of the foregoing two (2)
sentences shall survive the termination of or Closing under this Agreement for one (1) year.



     1.17. Title Company. Chicago Title Company, 1043 S. 5th Street,
Springfield, Illinois 62703.



     1.18. Trade Name. Any and all right, title or interest of Seller in and to and under
the trade name “Lincoln Tower Apartments”.



2. PURCHASE AND SALE; DEPOSIT




     Subject to the terms and conditions herein, Seller agrees to sell and Buyer agrees to purchase
the Property for the Purchase Price. Within five (5) business days after the Effective Date, Buyer
shall deposit the Deposit in escrow with the Title Company. In the event of Closing, the Deposit
shall be delivered to Seller and shall be
applied as a credit against the Purchase Price. The Deposit shall be held in a separate,
non-commingled interest bearing account with a federally insured financial institution reasonably
acceptable to Buyer and all interest earned thereon shall be deemed to be a portion of the Deposit.
If Buyer shall fail to timely deliver the Deposit to Title Company, then this Agreement shall, at
the option of Seller by written notice to Buyer, terminate whereupon all rights and obligations of
the parties under this Agreement shall expire, and this Agreement shall



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become null and void.
If this Agreement is terminated after the Deposit is made, the Deposit shall be refunded to
Buyer or delivered to Seller as provided for below. The provisions of this Section 2 and the
remaining terms of this Agreement regarding the application or release of the Deposit shall survive
the termination of this Agreement until such time as the Deposit shall have been fully released to
Seller or Buyer without any dispute between Seller and Buyer with respect thereto, or, in the event
of any such dispute, until a final, non-appealable judicial or arbitrator order.




3. INSPECTION OF PROPERTY; CONDITIONS




     3.1. Buyer’s obligation to purchase the Property is expressly conditioned upon Buyer’s
satisfaction with or waiver in writing of each of the Conditions. Buyer shall pay all costs
associated with its inspection of the Property to determine the satisfaction of the Conditions,
except that Seller shall pay the premiums for the standard owner’s policy of title insurance to be
issued pursuant to the Commitment, and the cost of the Commitment (if separately charged), and
shall provide to Buyer all of the Seller’s Documents at Seller’s expense.



     3.2. Within five (5) business days after the Effective Date, Seller shall deliver to Buyer (i)
true copies of all the documents (“Seller’s Documents”) listed on Exhibit D attached hereto and
incorporated herein by reference (or, to the extent set forth on said Exhibit D, make available
such Seller’s Documents to Buyer at the Real Property), and (ii) the Commitment and legible copies
of all documents noted therein as exceptions to Seller’s title to the Real Property (collectively,
the “Title Documents”). In addition, Seller shall make all of its documents, books, records and
other information related to the Property and in Seller’s possession, however stored or
maintained, available to Buyer for Buyer’s review at Seller’s offices.



     3.3. During the Inspection Period, Buyer may make such investigations as it shall deem
relevant in order to satisfy the Conditions. Such investigations may be conducted by Buyer or its
designees, including lawyers, engineers, accountants, contractors, architects, agents or employees.
For the duration of this Agreement, Buyer and its designees have the right and license to enter
upon the Real Property (including individual apartments or offices) during normal business hours
(unless otherwise approved by Seller) and upon reasonable advance notice to Seller or its
designated agents (which notice may be via telephone), and to conduct such tests, studies, audits,
surveys, examinations, inspections, interviews of Property personnel and investigations thereon as
Buyer shall reasonably desire. Buyer shall indemnify, defend and hold Seller harmless against any
loss, liability, or expense resulting from Buyer’s entry upon the Real Property (but excluding any
amounts or claims arising from (i) Buyer’s mere discovery of defects or conditions affecting the
Property or (ii) the negligence or willful misconduct of Seller or its agents, employees, invitees
(other than Buyer and Buyer’s designees) or representatives). If this Agreement shall terminate
without Closing, Buyer shall restore any damage caused by Buyer’s entry upon the Real Property to
substantially the condition existing immediately prior to such entry. The provisions of the
foregoing two (2) sentences shall survive the termination of this Agreement for one (1) year.



     3.4. Buyer shall have the right at any time prior to the end of the Inspection Period to
terminate this Agreement, for any reason or no reason at all, upon written notice to Seller, in
which event (i) this Agreement shall terminate and be of no further force or effect, (ii) the
Deposit shall be returned to Buyer, and (iii) neither party shall have any further liability or
obligation hereunder.



     3.5. Seller shall promptly after the Effective Date provide to Borrower copies of the proposed
Condominium Documents, all in advance of any execution thereof, submission to any governmental
agency with jurisdiction over such condominium regime, or any recordation thereof in the real
property records. Buyer shall have the right during the Condominium Document Review
Period to review the proposed Condominium Documents and provide comments thereto. In the event
Buyer objects to any aspect of the proposed Condominium Documents using reasonable business
judgment or due to the objection of any proposed lender to



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Buyer, Buyer shall give written notice
to Seller within ten (10) business days after receipt of the proposed Condominium Documents
specifically setting forth Buyer’s basis for such objection and within ten (10) business days after
Buyer and its proposed lender execute an application or commitment for a loan specifically setting
forth Buyer’s lender’s basis for such objection. Seller shall then have fifteen (15) days to
resolve Buyer’s objection, failing which Buyer may accept the proposed Condominium Documents and
proceed to Closing, or Buyer may terminate this Agreement upon written notice to Seller, in which
event (i) this Agreement shall terminate and be of no further force or effect, (ii) the Deposit
shall be returned to Buyer, and (iii) neither party shall have any further liability or obligation
hereunder.




     3.6. Buyer, at its sole cost and expense, shall have the right to obtain an updated survey of
the Real Property; provided, however, that any existing as-built ALTA survey for the Real Property
and the proposed Condo Plat shall be included in the Seller’s Documents. Buyer shall have the
right, on or before the date ten (10) days prior to the expiration of the Inspection Period, to
notify Seller of any objections to the Title Condition of the Real Property. Seller shall use its
good faith efforts to remedy any such objections and shall have five (5) Business Days from its
receipt of any such notice to notify Buyer of its proposed cure for each objection and to provide
Buyer with a revised Commitment evidencing that such objections have been remedied and/or insured
over in a manner satisfactory to Buyer in its sole and absolute discretion. If there are any liens
or encumbrances against the Real Property securing liquidated amounts, Seller shall pay and
discharge the same at or before Closing without the requirement of objection by Buyer thereto. If
Seller fails timely to provide such notice and/or such Commitment, Buyer shall have the right: (a)
to accept such objections as Permitted Exceptions to title to the Real Property, or (b) to
terminate this Agreement upon notice to Seller on or before the expiration of the Inspection
Period, in which event (i) this Agreement shall terminate and be of no further force or effect,
(ii) the Deposit shall be returned to Buyer, and (iii) neither party shall have any further
liability or obligation hereunder. Seller shall pay for a final owner’s title insurance policy to
be issued subsequent to Closing in accordance with the Commitment as approved by Buyer, shall
comply with all requirements set forth in the Commitment (including those relating to issuance of
the owners policy of title insurance without standard exceptions) and shall cause the Title Company
to hand mark the Commitment or provide a Pro Forma title policy as an effective title insurance
policy at and as of the time of Closing. Seller shall deliver to Buyer and Title Company at
Closing an ALTA Statement and a GAP Indemnity which provides that there are no new exceptions to
the Commitment except for those exceptions created by the act or omission of Buyer. The owner’s
title insurance policy shall insure marketable fee simple title to the Real Property in Buyer,
subject only to the Permitted Exceptions, in the amount of the Purchase Price, as of the date and
time of Closing or the recording of the Deed, whichever is later, and shall include such
endorsements as Buyer shall require and which endorsements shall be at Buyer’s sole cost (except
for endorsements that are necessary to address a title objection, which shall be at Seller’s
expense).



     3.7. “AS” “IS” CONDITION; RELEASE. EXCEPT FOR THE EXPRESS WARRANTIES, REPRESENTATIONS AND
COVENANTS OF THE SELLER HEREIN CONTAINED, THE BUYER ACKNOWLEDGES AND AGREES THAT IT IS SOLELY
RELYING UPON ITS INVESTIGATION AND EXPERTISE AND THAT OF ITS CONSULTANTS, CONTRACTORS, LAWYERS,
ACCOUNTANTS AND OTHER ADVISORS WITH RESPECT TO WHETHER OR NOT TO PURCHASE THE PROPERTY AND THAT
BUYER IS NOT ACTING UPON OR UNDER ANY EXPRESS OR IMPLIED WARRANTY OR REPRESENTATION OF ANY NATURE
OF THE SELLER WITH RESPECT TO ANY EXPECTATIONS
OR UNDERSTANDINGS AS TO THE PROFITABILITY OR LACK OF PROFITABILITY, STRUCTURAL OR OTHER
CONDITIONS RELATED IN ANY MANNER TO THE PROPERTY. IN THE EVENT THE BUYER PURCHASES THE PROPERTY IN
ACCORDANCE WITH THE TERMS HEREOF AFTER WAIVER OF THE CONDITIONS SET FORTH HEREIN, THE BUYER
ACKNOWLEDGES AND AGREES THAT THE PROPERTY ARE BEING PURCHASED IN AN “AS IS,” “HOW IS” AND “WHERE
IS” CONDITION AND THAT THE BUYER IS, EXCEPT FOR THE EXPRESS WARRANTIES, REPRESENTATIONS AND
COVENANTS OF SELLER HEREIN CONTAINED, HEREBY RELEASING



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THE SELLER AND ALL OF THE PERSONS, TRUSTS
AND ENTITIES THAT THE SELLER IS EXECUTING THIS AGREEMENT ON BEHALF OF AS OWNERS OF THE PROPERTY
FROM ALL CLAIMS OR CAUSES OF ACTION RELATING IN ANY WAY TO ANY AND ALL IMPLIED (AS OPPOSED TO
EXPRESS) WARRANTIES, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF FITNESS FOR A PARTICULAR
PURPOSE AND MERCHANTABILITY, REPRESENTATIONS AND COVENANTS, ANY EXPRESSLY DISCLAIMED MATTERS BY
SELLER, OR OTHERWISE WITH RESPECT TO THE PROPERTY OR THE CONDITION THEREOF.




     IN ADDITION TO THE FOREGOING, THE BUYER ACKNOWLEDGES AND AGREES THAT IN THE EVENT THE BUYER
PURCHASES THE PROPERTY IN ACCORDANCE WITH THE TERMS HEREOF, THE BUYER SHALL BE DEEMED TO HAVE MADE
ITS OWN INSPECTION OF THE PROPERTY WITH RESPECT TO THE EXISTENCE OR POTENTIAL EXISTENCE OF
LEAD-BASED PAINT, ASBESTOS, MOLD, INDOOR AIR QUALITIES, MOISTURE, MICROORGANISMS, RADON, OR ANY
OTHER CHEMICAL OR TOXIN SECRETED THEREFROM, INCLUDING WITHOUT LIMITATION, WALL CAVITIES, ATTICS,
WINDOWS, BASEMENTS, EXTERIOR OR INTERIOR SURFACES OF THE BUILDING CONSTITUTING THE REAL PROPERTY OR
ANY PART THEREOF, AND THAT THE BUYER HEREBY RELEASES THE SELLER WITH RESPECT TO ANY CLAIMS OR
CAUSES OF ACTION RELATING IN ANY WAY TO THE CONDITION OF THE PROPERTY WITH RESPECT TO THE FOREGOING
MATTERS.



4. CURRENT OPERATIONS




     4.1. From the Effective Date until the Closing or earlier termination of this Agreement,
Seller shall not enter into, modify, or terminate any lease, agreement and/or contract affecting
the Real Property, except as reasonable and standard practice in the ordinary course of business,
and, with respect to new service contracts and other agreements (but not residential lease
agreements), Buyer shall be given prior notice thereof and such new service contract or other
agreement shall be terminable without penalty or payment upon not more than 30 days’ notice. No
rents or deposits with respect to the Real Property are or on the Closing date will be held by
Seller, except security deposits and prepaid rents for the current month.



     4.2. From the Effective Date until the Closing or earlier termination of this Agreement Seller
shall conduct the business of the Property in the ordinary course in substantially the same manner
as the Property is operated as of the Effective Date, including maintenance of substantially the
same leasing practices, advertising and marketing programs for the Real Property, and in accordance
with all applicable laws, and will not (i) transfer or convey the Property or any interest in
Seller, or enter into any agreement to do so, where such transfer or conveyance would impair
Seller’s ability to convey the Property to Buyer as set forth herein (except for a conveyance
permitted pursuant to the last sentence of Section 11 hereof), (ii) create or agree to any
easements, liens, mortgages, encumbrances or other interests that would affect the Property or
Seller’s ability to comply with this Agreement (with the exception of any easements, encumbrances
or other interests created necessary to effect the creation of the Condominium in strict accordance
with the terms of Section 12 hereof); (iii) fail to maintain and repair the Real Property in at
least the manner that Seller has done previously; (iv) fail to comply promptly with any notices of
violation of laws or municipal ordinances, regulations, orders or requirements of departments of
housing, building, fire, labor, health, or other state, city or municipal departments or other
governmental authorities having jurisdiction against or affecting the Real Property or the use
or operation thereof; (v) initiate or knowingly consent to, approve or otherwise take any action
with respect to zoning or any other governmental rules or regulations presently applicable to all
or any part of the Real Property (with the exception of actions taken to convert the Real Property
to a condominium); (vi) fail to pay when due and payable all taxes and other public charges
assessed against the Real Property or Seller; (vii) fail to keep current and free from default any
and all secured financing against the Real Property; (viii) fail to pay in a timely fashion all
proper bills for labor or services for work performed for on or behalf of Seller with respect to
the



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Property; or (ix) fail to comply with all covenants, restrictions, easements or agreements
affecting the Real Property. Between the Effective Date and the Closing date, Seller shall
maintain in full force and effect substantially the same insurance coverages currently in place.




     4.3. Seller shall give to Buyer full and accurate written disclosure of any material change in
any Seller Representation or any change in any Exhibit to this Agreement promptly upon obtaining
knowledge thereof (provided, however, that no such subsequent disclosure shall be deemed to modify
any such Representation or Exhibit for the purpose of determining any right or remedy of Buyer
under this Agreement).



     4.4. Seller acknowledges and agrees that, as of the date hereof, certain repairs or
modifications are required to be made by Seller at its sole costs and expense to the Real Property
relating to the conversion of the former gym into a three (3) bedroom apartment and the former
leasing office to a two (2) bedroom apartment in accordance with rent-ready conditions consistent
with the other apartments at the Real Property (collectively, the “Required Work”). Seller agrees
that it is obligated: (i) to perform the Required Work with materials of similar quality as the
existing improvements on the Real Property; (ii) to diligently and continuously (subject to matters
of force majeure, delays caused by Buyer and matters otherwise beyond the reasonable control of
Seller) carry out such Required Work until completion thereof, which completion shall occur prior
to the Closing date; (iii) upon receipt of a written request from Buyer, to provide Buyer with lien
waivers following completion of the Required Work from each and every contractor, materialman,
engineer, architect and surveyor who might have lien rights in connection therewith, in form and
substance reasonably satisfactory to Buyer and its counsel and to indemnify Buyer from and against
any claims, or demands for payment, or any liens or lien claims made against Buyer or the Real
Property for labor or materials provided to or for the benefit of Seller in performing the Required
Work, provided that such claims or demands for payment, liens or lien claims do not result from
Buyer’s negligence or willful misconduct; and (iv) to indemnify, defend and hold Buyer harmless
from and against any and all claims, liabilities, damages, losses, costs and expenses of any kind
or nature whatsoever (including, without limitation, attorneys’ fees and expenses and court costs)
suffered, incurred or sustained by Buyer as a result of, by reason of, or in connection with the
Required Work.



     4.5. Seller shall reasonably cooperate in the transfer of the Property. In furtherance
thereof, if any utility accounts are not transferred as of the Closing date, the parties shall
cooperate in arranging for said transfer as soon as practicable after the Closing date.



     4.6. The covenants set forth in Section 4 of this Agreement shall survive Closing for one (1)
year.



5. CLOSING




     5.1. Buyer’s Deliveries. At the Closing, Buyer shall deliver to Title Company (i) for
payment to Seller, the Purchase Price, via federal wire transfer of funds, as adjusted by the
adjustments set forth in Section 5.3 below, and (ii) the Closing Statement in accordance with
Section 5.3 hereof. Buyer shall assume all of the landlord’s obligations under the Leases relating
to periods subsequent to Closing including the obligation to refund security deposits of tenants of
the Real Property, but only as to those security deposits for which Buyer receives credit at the
Closing against the Purchase Price. Buyer shall not assume any obligations under the
Leases for claims or suits of tenants asserted as arising from the conduct of Seller or from
events occurring prior to the Closing and Seller shall have no obligation under the Leases for
claims or suits of Tenants asserted as arising from the conduct of Buyer or from events occurring
after the Closing.



     5.2. Seller’s Deliveries. At the Closing, Seller shall execute and/or deliver to Buyer
the following, each of which shall be in form and substance reasonably satisfactory to Buyer, with
drafts thereof having been provided by Seller to Buyer not less than three (3) Business Days prior
to Closing:



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          (i) A warranty deed, in recordable form, conveying marketable title to the Real Property
subject only to the Permitted Exceptions, to Buyer, and any required real estate transfer
tax/documentary/deed tax affidavits, applications or declarations;




          (ii) An assignment of the Leases and other occupancy agreements and all rents due and to
become due thereunder with respect to the Real Property; provided, however, that such assignment
shall not impose any liability on Buyer for any default of Seller under the Leases. Seller shall in
such assignment indemnify, agree to defend and hold Buyer harmless from any liability of any kind
or nature that shall have accrued under the Leases prior to Closing and Buyer shall in such
assignment indemnify, agree to defend and hold Seller harmless from any liability of any kind or
nature that shall have accrued under the Leases subsequent to Closing;




          (iii) A bill of sale and assignment covering all of the Personal Property, warranties
(specifically including the roof warranty, if any), any Contracts that Buyer elects to assume from
and after Closing (to be listed as an exhibit thereto), licenses, permits, entitlements, all
intangible rights associated with the Property and all claims, guarantees, warranties,
indemnifications and all other rights, if any, which Seller may have against suppliers, laborers,
materialmen, contractors or subcontractors arising out of the Real Property and such bill of sale
shall warrant title to such Personal Property and that the same are in good operating condition;




          (iv) An affidavit stating that the Rent Roll attached to this Agreement as Exhibit E is, as of
Closing, true, accurate and complete and noting any differences between such Rent Roll and the then
current state of facts with respect to the matters set forth on the Rent Roll;




          (v) An affidavit stating that Seller is not a “Foreign Person” within the meaning of Internal
Revenue Code Section 1445(f)(3) or Buyer shall be entitled to withhold appropriate amounts as
required by the Internal Revenue Code;




          (vi) All affidavits required by the Title Company to issue the owners policy of title
insurance in accordance with the Commitment approved by Buyer, and such evidence as Title Company
may require that Seller has the power and authority to execute and enter into this Agreement and to
consummate the sale of the Real Property, and that any and all actions required to authorize and
approve the execution of and entry into this Agreement by Seller, the performance by Seller of all
of Seller’s duties and obligations under this Agreement, and the execution and delivery by Seller
of all documents and other items to be executed and delivered to Buyer at Closing, have been
accomplished;




          (vii) A 1099-S request for taxpayer identification number and certification and
acknowledgment in the customary form thereof;




          (viii) The Closing Statement in accordance with Section 5.3 hereof;




          (ix) Any special notices, disclosures, certificates or other instruments required by
applicable local law, the Title Company or Buyer’s auditors;




          (x) A certificate of Seller certifying to Seller’s actual knowledge as of the Closing Date
that the representations and warranties of Seller set forth on Exhibit C hereof are, subject to any
changes of fact or circumstance affecting such representations and warranties that occur between
the Effective Date and the Closing date (and are approved by Buyer) are true and correct in all
material respects;




          (xi) Exclusive possession of the Property to Buyer, subject only to the Permitted Exceptions
and the rights of tenants under the Leases;




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          (xii) All original Leases, lease files, correspondence files and other books and records, keys
to all leased premises and to the Real Property, security codes, if any, and maintenance agreements
(e.g., HVAC maintenance agreement) relating solely to the Property in Seller’s possession (to the
extent Closing occurs through an escrow procedure, such Leases, files and books and records shall
be deposited with the escrow agent before Closing and shall be delivered to Buyer on the first
business day immediately following Closing);




          (xiii) All original, to the extent available, existing plans and specifications in Seller’s
possession or control relating to the improvements located upon the Real Property; all licenses,
permits and certificates of occupancy or such other comparable certificates or documents issued by
the appropriate governmental authorities with respect to the Real Property or any part thereof; and




          (xx) A notice to all tenants of the Real Property of the change of ownership of the Real
Property and directing that rental and all other payments to be made by such tenants under their
Leases shall be paid to Buyer at an address to be designated by Buyer in such notice.




     5.3. Closing Statement. Seller and Buyer shall execute and deliver to each other a
Closing Statement showing the amounts by which the Purchase Price shall have been adjusted, such
adjustments to be made as of the date of Closing, as follows:



          (i) Taxes and assessments, special and otherwise, which are a lien against the Real Property
and which are due and payable as of the date of Closing shall be paid (or caused to be paid) by
Seller at or prior to Closing. All other liens which encumber the Property as of Closing shall be
the sole responsibility of Seller; provided, that, Buyer may, at its option, pay any such liens and
receive full credit against the Purchase Price;




          (ii) Real estate taxes shall be prorated between the parties and/or paid by the parties based
on local custom used for prorating real estate taxes in commercial transactions at the location of
the Real Property (i.e., Seller shall pay all amounts attributable to any period prior to Closing).
Reimbursements received by Seller or Buyer of amounts paid for real estate taxes shall be prorated
between the parties in the manner hereinabove provided for the proration of real estate taxes;




          (iii) Real transfer taxes and documentary stamps or filing/recording fees (exclusive of Buyer
lender document recording fees and stamps) shall be paid by Seller;




          (iv) Seller shall deliver to Buyer (or Buyer shall receive a credit against the Purchase Price
in the amount of) all unapplied security deposits provided for under the Leases (including all
interest earned thereon if any or if required by applicable laws);




          (v) Seller shall pay all water, sewer, and utility charges and other operating expenditures
and all payments to be made by Seller under Contracts through Closing, and any payments received or
receivable by Seller under Contracts shall be pro-rated through Closing. If final readings have not
been taken, estimated
charges based on the most recent statements received shall be prorated between the parties,
and post-closing adjustments shall be made when the actual billings are received or an escrow shall
be established to provide for payment of utility and other maintenance payables;




          (vi) Rentals under all Leases (including apartment leases, office leases, parking leases and
cell tower leases) received by Seller prior to Closing shall be prorated between the parties with
rentals from and after the date of Closing allocated to Buyer. If and when Buyer receives any past
due rents or other charges owing with respect to periods before the Closing date, Buyer shall be
entitled to apply such sums to current rent and other charges, and shall remit any excess sums
allocable to periods prior to the date of Closing to Seller;




9









 








          (vii) any unpaid leasing or brokerage commissions, or apartment locator fees, in each case,
which relate in any way to any Lease(s) which have been signed prior to Closing in connection with
the Real Property shall be paid by Seller;




          (viii) Seller shall pay the costs of the owner’s title insurance policy as set forth in
Section 3.6 hereof; and




          (ix) all escrow fees of Title Company shall be borne equally by Seller and Buyer.




     5.4. Conditions of Buyer’s Obligation. Buyer’s obligation to consummate the purchase
and sale of the Property on the Closing date shall be contingent and conditioned upon the
satisfaction or performance of the following conditions, any one or more of which may be waived by
Buyer, in whole or in part, on and as of the Closing date:



               (i) Seller shall have performed in all material respects all covenants, undertakings and
obligations of Seller required to be performed by Seller under this Agreement and all
Representations remain true and correct in all material respects;



               (ii) On the Closing date, Seller shall have delivered all documents and instruments required
to be delivered by Seller under Section 5.2 hereof; and



               (iii) The Title Company shall have irrevocably and unconditionally committed to Buyer in
writing to issue the owners title insurance policy satisfying the conditions of this Agreement
pursuant to which the Title Company commits to insure Buyer’s title to the Real Property in an
amount equal to the Purchase Price and subject only to the Permitted Exceptions; provided,
however, in the event that Title Company is unable to so commit as a result of Buyer’s
failure (a) to perform any obligations of Buyer under this Agreement, or (b) to satisfy any
requirements set forth in the Commitment other than to the extent such requirements will be
satisfied by the execution and delivery of the documents to be executed and delivered by Seller
pursuant to this Agreement and the payment of the title insurance premium for the Title Policy by
Seller pursuant to Section 3.6 of this Agreement, then (x) such failure by the Title Company to so
commit shall not constitute a failure to satisfy or perform the closing condition set forth herein
and (y) if Buyer does not consummate the transaction contemplated by this Agreement, Buyer shall be
in default under this Agreement and Seller shall have the right to exercise such rights and
remedies as may be provided for in Section 6 this Agreement.


If any of the foregoing conditions have not been satisfied or performed on or as of the Closing
date, Buyer shall have the right, at Buyer’s option, to terminate this Agreement by giving Seller
written notice of such termination on and as of the Closing date, in which event the Deposit shall
be refunded to Buyer promptly upon request, all rights and obligations of the parties under this
Agreement shall expire, and this Agreement shall become null and void. Nothing contained in this
Section 5.4 shall limit Buyer’s remedies as contained in this Agreement.




     5.5 Possession at Closing. Seller shall surrender possession of the Property to
Buyer on the Closing date, subject only to the Permitted Exceptions.



6. DEFAULT




     6.1. If Buyer fails to pay the Purchase Price on the Closing date such that the sale
contemplated hereby is not consummated for in excess of twenty (20) days after written notice
thereof to Buyer, provided that Seller is not then in default hereunder, Seller’s sole and
exclusive remedy shall be to terminate this Agreement, in which event (i) this Agreement shall
terminate and be of no further force or effect, and (ii) the Deposit shall be delivered to Seller
as liquidated damages. The parties acknowledge that Seller’s actual damages in the event of a



10









 




default by Buyer will be difficult to ascertain, that such liquidated damages represent the
parties’ best estimate of such damages, and that Seller and Buyer believe such liquidated damages
are a reasonable estimate of such damages. The parties expressly acknowledge that the foregoing
liquidated damages are intended not as a penalty, but as full liquidated damages, in the event of a
default. Such liquidated damages shall be the sole and exclusive remedy of Seller by reason of a
default by Buyer, and Seller hereby waives and releases any right to sue Buyer for specific
performance of this Agreement or to prove that Seller’s actual damages exceed the amount which is
herein provided to Seller as full liquidated damages; provided, however, that the foregoing shall
not limit Seller’s right to indemnification as set forth elsewhere in this Agreement.




     6.2. If Seller defaults in the performance of any of its obligations and/or covenants
hereunder for in excess of twenty (20) days after written notice thereof to Seller, provided that
Buyer is not then in default hereunder, at Buyer’s election in its sole discretion, Buyer may seek
specific performance of this Agreement or Buyer may elect to have the Deposit delivered to Buyer
and Buyer shall have the right to pursue all other remedies available at law; provided, however,
that except as set forth in Section 10 hereof, monetary damages against Seller shall be limited to
Borrower’s actual, out-of-pocket expenses in connection herewith and its investigations and
diligence of the Property; provided further, however, that the foregoing shall not limit Buyer’s
right to indemnification from Seller as set forth elsewhere in this Agreement.



7. DAMAGE TO PROPERTY




     If any improvements on the Real Property are damaged or destroyed by fire, storm or other
casualty (a “Casualty”) on or before Closing, Seller shall give prompt written notice thereof to
Buyer. If the Casualty is for any part of the Real Property is in excess of five percent (5%) of
the total rentable area, five percent (5%) of the garage or covered parking, or two and one-half
percent (2.5%) of the Purchase Price (any of the foregoing, a “Material Casualty”), then Buyer may
terminate this Agreement within fifteen (15) days after receiving notice of such Material Casualty
(and the Closing date shall be extended, if necessary, to afford Buyer the full 15 days), by notice
to Seller, in which event (i) this Agreement shall terminate and be of no further force or effect,
(ii) the Deposit shall be returned to Buyer, and (iii) neither party shall have any further
liability or obligation hereunder. In the event that the Casualty is not a Material Casualty, or
if Buyer does not elect to terminate this Agreement due to a Material Casualty, then in the event
of Closing, Buyer shall be entitled to receive an absolute assignment from Seller of Seller’s
interest in the proceeds of any insurance on the Property (including any rent loss insurance
allocable to the period from and after Closing) (or, if paid to Seller prior to Closing, to offset
the Purchase Price), and the Purchase Price shall be reduced by the amount of any deductible.
Buyer shall have the right to participate in any negotiations with the insurance company in
connection with any Casualty prior to the Closing date, and if no notice of termination is given by
Buyer in accordance with this Section 8, then no settlement shall be made without Buyer’s prior
written consent.



8. CONDEMNATION




     If notice of any action, suit or proceeding shall be given, or a bona fide threat of the
commencement thereof shall be made, prior to Closing for the purpose of condemning or taking by
eminent domain any part of the Real Property (a “Condemnation”), Seller shall give prompt written
notice thereof to Buyer. If the Condemnation is for any part of the Real Property is in excess of
five percent (5%) of the total rentable area, five percent (5%) of the total number of existing
parking spaces, or two and one-half percent (2.5%) of the Purchase Price, or permanently and
materially impairs the current use of all or any portion of the Real Property or access to the Real
Property (any of the foregoing, a “Material Condemnation”), then Buyer may terminate this Agreement
within fifteen (15) days after receiving notice from Seller of such Material Condemnation (and the
Closing date shall be extended, if necessary, to afford Buyer the full 15 days), by notice to
Seller, in which event (i) this Agreement shall terminate and be of no further force or effect,
(ii) the Deposit shall be returned to Buyer, and (iii) neither party shall have any further
liability or obligation hereunder. In the event that the Condemnation is



11









 




not a Material
Condemnation, or if Buyer does not elect to terminate this Agreement due to a Material
Condemnation, then in the event of Closing, the proceeds of such condemnation shall be assigned and
shall belong to Buyer (or, if paid to Seller prior to Closing, to offset the Purchase Price).
Buyer shall have the right to participate in any negotiations in connection with any noticed or
threatened Condemnation prior to the Closing date, and if no notice of termination is given by
Buyer in accordance with this Section 8, then no settlement shall be made without Buyer’s prior
written consent.




9. BROKER




     Each party represents and warrants to the other that they have not dealt with a real estate
broker or finder in connection with the purchase and sale of the Property with the exception of
Marcus & Millichap of Oakbrook Terrace, Illinois, who has acted as agent for Seller (“Broker”).
Seller shall be responsible for all fees and commissions due Broker. Buyer shall indemnify, defend
and hold harmless Seller against any liability for brokerage commissions, finders’ fees or the like
(“Commissions”) arising from the purchase of the Property that may be claimed by any party alleging
to have been retained or utilized by Buyer. Seller shall indemnify, defend and hold harmless Buyer
against any liability for Commissions arising in connection with the sale of the Property which may
be claimed by any party alleging to have been retained or utilized by Seller and Seller shall
provide a waiver of broker lien rights executed by Broker at Closing. The provisions of this
Section shall survive Closing or the termination of this Agreement.



10. ADDITIONAL PROVISIONS; NOTICES




     The provisions set forth on Exhibits C and F attached hereto and incorporated herein by
reference shall be deemed included in this Agreement. The representations and warranties set forth
on Exhibit C or otherwise in this Agreement shall be deemed to be made as of the Effective Date and
again as of the date of Closing and shall survive Closing for one (1) year. Buyer hereby waives
any claim for breach of said representations and warranties not asserted within said six (6) months
after the expiration of said one (1) year period. Notwithstanding the foregoing provisions of
this Section 10, it is expressly acknowledged and agreed that, if Buyer shall actually discover, or
be made aware, prior to Closing that any Representation was untrue when made, or has become untrue
prior to Closing, then, Buyer shall have the right to terminate this Agreement promptly upon
written notice to Seller on or prior to the Closing Date, and in the event of such termination the
Deposit shall promptly be returned to Buyer; provided, however, that if the
representation or warranty was (A) known to Seller to be materially false or inaccurate when made
or (B) known to Seller to be materially false or inaccurate prior to the Closing but not disclosed
in writing to Buyer at or prior to Closing, then Buyer shall be entitled to recover in addition to
the amount of Buyer’s actual, out-of-pocket expenses in connection with this Agreement and its
investigations and diligence of the Property as provided in Section 7 hereof, any other actual
damages incurred by Buyer in an amount not to exceed One Hundred Thousand and 00/Dollars
($100,000.00).



11. ASSIGNMENT




     This Agreement is freely assignable by Buyer without the prior written consent of Seller to
any affiliate of Steadfast Asset Holdings, Inc. (and including without limitation in connection
with any investment program thereof), provided that such assignment is in writing and that the
assignee assumes all of the interests and all of the obligations of Buyer under this Agreement,
which assignment shall be deemed effective upon written notice given to Seller, and any such
assignment by Buyer automatically and without the requirement of any further written instruction
shall constitute a novation and release of the assignor under this Agreement effective as of the
date of such assignment. Other than the foregoing, Buyer may assign this Agreement only with the
prior consent of Seller, which may be granted in Seller’s sole discretion. Seller may not assign
this Agreement or any interest therein without the prior written consent of Buyer in its sole and
absolute discretion, provided, however, that prior to Closing, Seller shall be entitled to transfer
ownership of the Property to a limited liability company



12









 




whose members have the same beneficial
interests as their beneficial interests under the Seller provided that the limited liability
company assumes all of the obligations of Seller under this Agreement, all such members execute and
deliver to Buyer a “joinder” in form and substance identical to that provided by Beneficiary, and
the conveyance documents are reasonably acceptable to Buyer.




12. CREATION OF CONDOMINIUM.




     Buyer is aware that Seller is in the process of creating a Condominium for real estate owned
by Seller, in order to ultimately convey the Real Property to Buyer. Seller hereby agrees to
proceed diligently and in good faith to expeditiously exercise reasonable diligence to create the
Condominium (subject to the terms of Section 3.5 hereof). Buyer shall diligently and in good faith
exercise reasonable diligence in its pre-submission review of the draft Condominium Documents, and
both Buyer and Seller shall negotiate in good faith, diligently and expeditiously to promptly
resolve any disagreement or conflict regarding the terms of the draft Condominium Documents. In
the event that, notwithstanding such diligent and good faith efforts to exercise reasonable
diligence, Seller is unable to complete the creation of the Condominium to affect the conveyance of
the Real Property to Buyer within ninety (90) days of the Effective Date, then Buyer may either (A)
terminate this Agreement upon written notice to Seller, in which event (i) this Agreement shall
terminate and be of no further force or effect, (ii) the Deposit shall be returned to Buyer, and
(iii) neither party shall have any further liability or obligation hereunder, or (B) extend the
Closing by such period as is reasonably necessary for Seller to accomplish the creation of the
Condominium.



13. MISCELLANEOUS




     13.1 Amendment. This Agreement cannot be modified except by a written instrument
signed by the parties.



     13.2 Beneficiaries. Subject to Section 11 hereof, this Agreement shall be binding upon
and shall inure to the benefit of Seller and Buyer and their respective, successors, assigns and
transferees. This Agreement confers no rights or remedies on any third party.



     13.3 Consents and Approvals. If an action by any party requires the consent or
approval of another party, that consent or approval shall be given, if at all, in writing, and any
consent or approval given in one instance shall not be deemed a consent or approval in any other
instance.



     13.4 Construction. Any list of examples set forth in this Agreement shall be deemed to
be illustrative, not exhaustive, unless explicitly specified otherwise. Whenever the context may
require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns
and pronouns shall include the plural, and vice versa. The use of the neuter singular pronoun
to refer to any party shall be a proper reference even though that party may be an individual, a
business entity, or a group of two or more individuals or business entities. All attachments
referenced within the Agreement shall be deemed incorporated in the Agreement by such reference.



     13.5 Counterparts. This Agreement may be signed in one or more counterparts, which
together shall constitute one and the same instrument. Signatures shall be binding on the signer
when delivered, regardless of whether delivery is in hard copy or by electronic means
(notwithstanding any statutory or decisional law to the contrary). Any defense(s) to the
enforcement of this Agreement based on the form of signature hereto by either party are hereby
waived.



     13.6 Entire Agreement. This Agreement and the exhibits attached hereto sets forth
fully and completely the agreement between the parties in connection with this transaction, there
are no written or oral agreements



13









 




between the parties relating to this transaction that are not
expressly set forth herein and this Agreement supersedes all prior oral or written agreements
relating to this transaction.




     13.7 Equal Participation. Seller and Buyer have participated equally in the
preparation of this Agreement, and, therefore, this Agreement and each provision thereof shall not
be construed in favor of or against any party to this Agreement by reason of one party’s being
deemed to prepared this Agreement or imposed such provision.



     13.8 Extension for Non-Business. To the extent a time period set forth in this
Agreement expires on a Saturday, Sunday or State or Federal holiday, then such time period shall
expire on the next day which is not a Saturday, Sunday or State or Federal holiday.



     13.9 Governing Law. This Agreement shall be governed by and construed in accordance
with the substantive and procedural laws of the State in which the Real Property is located without
regard to conflict of law principles.



     13.10 Headings. The titles and headings in this Agreement are provided as a matter of
convenience only and shall not be understood to define, limit, construe, or describe the scope or
intent of any provision of this Agreement.



     13.11 Legal Fees. In the event of any litigation between Buyer and Seller relating to
or in connection with this Agreement, the prevailing party shall be entitled to recover from the
losing party its actual costs and expenses of the litigation, including reasonable attorneys’ fees.
The provisions of this Section shall survive Closing or the termination of this Agreement.



     13.12 Severability. If any provision of this Agreement shall be determined to be
invalid or unenforceable, such determination shall not affect any other provision of this
Agreement, and all other provisions shall remain in full force and effect.



     13.13 Waivers. A waiver by any party of a performance obligation or default under any
provision of this Agreement shall not be deemed (i) a waiver of a further obligation or default
under the same provision or (ii) a waiver of an obligation or default under any other provision.



     13.14 Tax Free Exchange. Buyer may acquire the Real Property and Seller may sell the
Real Property as a tax-free exchange under Section 1031 of the Internal Revenue Code. In
connection therewith, the parties agree to execute such documents as are reasonably necessary or
appropriate and to otherwise cooperate with
one another to effectuate such exchange; provided the other party’s representatives shall have
a reasonable opportunity to review such documents prior to Closing and further provided that the
party not participating in an exchange shall not incur any additional cost or liability as a result
of the exchange.



          Each party electing to request such an exchange hereby indemnifies, defends and holds the
other party free and harmless from any loss or liability (including, but not limited to the tax
ramification to the other party of such tax-free exchange) arising by reason of performing the acts
required hereby to effectuate such exchange. The party which has not requested the exchange shall
not take title to or otherwise assume any liability with respect to the property to be exchanged
with the Property.



     13.15 Buyer’s Representations and Warranties. Buyer represents and warrants that it
has the right to execute this Agreement and to purchase the Property without obtaining the consent,
approval, release, or signature of any other party that has not been obtained as of the date hereof
or will be obtained prior to Closing. The signatories hereto on behalf of Buyer have been duly
authorized to execute and deliver this Agreement and to bind Buyer hereto. Buyer has full power to
consummate the transaction described in this Agreement, the



14









 




execution and delivery of this
Agreement by Buyer and the consummation by Buyer of this transaction described herein has been duly
and validly authorized by all necessary action and the observance of all required formalities on
the part of Buyer such that this Agreement constitutes a valid and legally binding obligation of
Buyer, enforceable against Buyer in accordance with its terms, subject to bankruptcy, insolvency,
moratorium, reorganization and other similar laws affecting creditors’ rights generally and to the
application of general equitable principles in connection with the enforcement thereof. Neither
the execution and delivery of this Agreement nor the consummation by Buyer of the transaction
contemplated hereby will (i) conflict with or result in a breach of or default under any of the
terms, conditions or provisions or any note, bond, mortgage, indenture, license, agreement or other
instrument or obligation to which Buyer is a party, or (ii) violate any order, injunction, decree,
statute, rule or regulation applicable to Buyer. The representations and warranties of Buyer as
set forth herein shall survive the Closing for a period of one (1) year. Seller hereby waives any
claim for breach of said representations and warranties not asserted within said six (6) months
after the expiration of said one (1) year period.




     13.16 Confidentiality. Buyer hereby agrees that all information and files to be
provided to Buyer by Seller in connection with the Property and any and all inspection reports
prepared by the Buyer therefrom shall be deemed “Confidential Information.” Buyer shall use said
Confidential Information solely for the purpose of determining whether or not the Buyer desires to
purchase the Property. At such time as Closing occurs, such Confidential Information shall no
longer be deemed confidential. Except as otherwise expressly provided immediately above, the Buyer
shall keep all Confidential Information confidential and hold and treat it in the strictest of
confidence, and Buyer shall not disclose the discussions that are taking place regarding a
potential transaction between the parties hereto. Except for Buyer’s employees, agents, attorneys,
accountants, investors or prospective investors, lenders or prospective lenders, and other advisors
and consultants, who have a need to know and advise the Buyer concerning the transaction herein
provided for by their inspections or in otherwise advising the Buyer (each, a “Buyer Advisor”),
Buyer may not disclose or allow the disclosure of the foregoing Confidential Information to any
party. Buyer shall inform each Buyer Advisor to which such Confidential Information is disclosed,
to keep such Confidential Information confidential subject to the terms hereof. Notwithstanding
anything herein to the contrary, (i) Buyer may make any disclosure of Confidential Information to
which Seller gives its prior written consent, (ii) any Confidential Information may be disclosed in
connection with any judicial suit or action or other adversarial proceedings between the parties
hereto or otherwise involving Buyer or any Buyer Advisor, (iii) any Confidential Information may be
disclosed as may otherwise be required by law, in the good faith opinion of its legal counsel, or a
court order, and/or (iv) any Confidential Information may be disclosed as generally may be in the
public domain by virtue of a disclosure not in violation hereof.



     Unless Seller gives its prior written consent to Buyer, Buyer may not (a) disclose any
Confidential Information to any person or entity other than as referred to or permitted above or
(b) use or permit the use of any Confidential Information for any purpose other than evaluating
Buyer’s contemplated purchase from the Seller in connection with the acquisition of the Property.
Any copies of Confidential Information provided to Buyer by Seller shall destroyed or be returned
to Seller (at Seller’s option) within ten (10) days after any termination of this Agreement.



     The Buyer also agrees that any breach or violation of the provisions of this section relating
to confidentiality would irreparably injure the Seller and may leave the Seller no adequate remedy
at law in which event the Seller shall be entitled to injunctive relief against the Buyer with
respect to any breach and seek all damages resulting therefrom against the Buyer; provided, however
that such damages shall not exceed $100,000.00 and shall not include punitive or consequential
damages. Seller’s remedies and damages for breach of these confidentiality provisions shall not be
limited to and shall be in addition to the payment of the Deposit to Seller in connection with a
termination of this Agreement by Seller as a result of said breach or violation.



15









 





     13.17 Press Releases. Any press release which the Buyer desires to make with respect
to the Real Property will not be made without the written consent of the Seller which consent may
be withheld in Seller’s sole discretion until ten (10) days after Closing has occurred with respect
to the Real Property, after which date no consent of (or notice to) Seller shall be required.



     13.18 Counsel. Each party hereto warrants and represents that each party has been
afforded the opportunity to be represented by counsel of its choice in connection with the
execution of this Agreement and has had ample opportunity to read, review, and understand the
provisions of this Agreement.



     13.19 Time of Essence. Time is of the essence of this Agreement. Anywhere a date
certain is stated for payment or for performance of any obligation, the day certain so stated
enters into and becomes a part of the consideration for this Agreement.



     13.20 Jury Trial Waiver. EACH OF THE PARTIES HEREBY WAIVES TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO WHICH SELLER AND/OR BUYER MAY BE PARTIES ARISING OUT OF, IN CONNECTION
WITH, OR IN ANY WAY PERTAINING TO, THIS AGREEMENT. THIS WAIVER IS KNOWINGLY, WILLINGLY AND
VOLUNTARILY MADE BY THE PARTIES AND EACH HEREBY REPRESENTS AND WARRANTS TO THE OTHER THAT NO
REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY INDIVIDUAL TO INDUCE THIS WAIVER OF TRIAL
BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS EFFECT. EACH PARTY FURTHER REPRESENTS AND WARRANTS
TO THE OTHER THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND THE MAKING OF THIS
WAIVER BY INDEPENDENT LEGAL COUNSEL, OF ITS OWN FREE WILL, AND HAS HAD THE OPPORTUNITY TO DISCUSS
THIS WAIVER WITH COUNSEL. The provisions of this Section shall survive Closing or the
termination of this Agreement.



     13.21 Broker Disclosure. Seller is a licensed real estate entity in the State of
Wisconsin.



     13.22 Record Access and Retention. Where there is a legitimate reason (including,
without limitation, a tax or other audit, other governmental inquiry, or actual or prospective
claim by or against either Seller or Buyer, or to which Seller or Buyer may become a party) for
Seller or Buyer to require access to records or other information relating to the Property that is
in the possession or control of the other party, and if providing such access would not adversely
affect (excluding records and information requested in connection with a claim against the other
party so long as such information is not subject to attorney-client privilege) the party whose
records or other information are being sought (in the good faith judgment of such party), each
party will allow
the other reasonable access to such records and information at its then-current location (or
such other location as the party in possession of such records or information may reasonably
designate), in order to analyze and/or copy the same (at the requesting party’s sole cost and
expense), for use solely for the purposes for which the same are being requested. In any case in
which a party hereto desires to obtain any records or information pursuant to this Section 13.22,
such party shall notify the other in writing of such request, setting forth in such notice the
purposes for which such records and information are being requested and the expected use thereof
(including, if applicable, the nature of any claim or other proceeding in which the same will be
used and the parties thereto), and the party receiving such request may, as a condition to granting
the same, require that the requesting party enter into an agreement protecting the confidentiality
of such records and information. In no event shall a party be obligated to provide access to
records or other information under this Section 13.22 in connection with any litigation, claim, or
dispute between Buyer and Seller, or in which Buyer and Seller are or may become adverse parties,
other than in accordance with applicable discovery and evidentiary rules and procedures applicable
to such matter, and no access to or disclosure of records or information shall be required
hereunder if the same would or reasonably could result in the loss of any attorney-client privilege
or other applicable evidentiary privileges that may be applicable to such records or information.
Each party shall maintain its records for use under this Section 13.22 for a period of not less
than one (1) year after the Closing date. The provisions of this Section shall survive Closing.



16









 





     13.23 IN WITNESS WHEREOF, the parties hereto have executed this Purchase Agreement as of the
last date set forth below.



	 	 	 	 	 
	BUYER:




STEADFAST ASSET HOLDINGS, INC.

 	 	 
	By:  	/s/ Dinesh Davar
 	  3/24/10 	 
	 	 Dinesh Davar, CFO       	  Date 	 
	 	 	 	 
	 



	 	 	 	 	 
	SELLER:




CHICAGO TITLE LAND TRUST COMPANY,



as Trustee under Trust Number 51-0615-0 dated August 15, 1967, an Illinois Land Trust

by: Towne Realty, Inc. d/b/a Lincoln Tower, Inc., authorized beneficiary

 	 	 
	By:  	/s/ John W. Keasey
 	    3/25/10 	 
	 	John W. Keasey, Vice President              	    Date 	 
	 	 	 
	 



Exhibit List:




A — Legal Description of Property

B — Personal Property

C — Seller’s Representations and Warranties

D — Seller’s Documents

E — Rent Roll

F — Notice Provisions

G — List of Contracts








17









 








EXHIBIT A




Legal Description



To be provided by Title Commitment



18









 





EXHIBIT B




Personal Property



To be provided as a Seller Document




19











 





EXHIBIT C




Seller’s Representations and Warranties



     Seller represents and warrants as follows, and shall indemnify Buyer against any liability and
expense, including attorneys’ fees, incurred by Buyer due to any of the following being materially
untrue or inaccurate:



     1. Contracts. To Seller’s knowledge, the Contracts set forth on Exhibit G are the only
agreements, contracts, and/or understandings relating to the ownership, operation, maintenance or
use of the Property and Seller has not contracted for any services or employment and has made no
commitments or obligations therefor which will bind Buyer as a successor in interest with respect
to the Property. All of the Contracts are in full force and effect. The copies of the Contracts
which have been or will be delivered by Seller to Buyer are true, correct and complete in all
material respects and include all amendments or modifications thereto. To Seller’s actual
knowledge, there are no existing material defaults under any Contracts by Seller or any
counterparty thereto.



     2. Rent Roll/Leases. The rent roll provided by Seller (“Rent Roll”) is a true and
correct list of all of the Leases presently in force and affecting the Real Property and truly,
accurately, fully and completely sets forth the information to be contained therein, including the
lease term and rental, information noted thereon; all of the Leases are in full force and effect
and no amendment, modification or supplement of any kind of any of such Leases exists other than as
specified on the Rent Roll; and all rental and other payments due under the Leases as of the
Effective Date has been paid in full, except as noted on the Aged Delinquency Report. Other than
as set forth on the Rent Roll, there are no leases, rental agreements or occupancy agreements for
use or occupancy of any portion of the Real Property. The Rent Roll is the rent roll maintained by
Seller and relied on by Seller for internal administration and accounting purposes in its day to
day operations. To Seller’s actual knowledge, no tenant under any Lease is in material default
under the applicable Lease, except as disclosed by the Aged Delinquency Report. Seller has
complied in all material respects with Seller’s duties and obligations as “lessor” or “landlord”
under the Leases.



     3. Concessions and Commissions. No tenants of the Real Property are entitled to
any concessions, rebates, allowances, or free rent for any period after the Closing and none of the
Leases or other instrument that will be assigned to Buyer at Closing provide for commissions
payable by the owner of the Real Property that have not yet been paid by Seller.



     4. Violation Notices. To Seller’s knowledge, Seller has not received any notice and
has no knowledge of or information as to (i) any violation by Seller or any prior owner of any
laws, zoning ordinances or building health or fire rules or regulations affecting the Real Property
or any other material notice from any applicable governmental authority with respect to Seller or
the Real Property, or (ii) any existing or threatened condemnation or other legal action of any
kind involving the Real Property. If any of the foregoing arise prior to the Closing date (other
than a Condemnation, which is subject to the terms of Section 8 of the Agreement), Seller shall
promptly notify Buyer, but shall not otherwise have any remedial or other obligations in connection
therewith except to the extent arising due to a breach by Seller of any Seller obligation under
this Agreement. Buyer is aware that parts of the Real Property may not meet current fire/life
safety/zoning requirements, but to Seller’s knowledge use of the Real Property is a legal,
non-conforming use and no action is delinquent or currently required in regard to these conditions.



     5. Environmental Matters. To Seller’s knowledge, the Real Property is not now and has
not ever been used for the purpose of disposal of, refining, generating, manufacturing, producing,
storing, handling, treating, transferring, releasing, processing or transporting any petroleum,
petroleum derived products and/or hazardous waste or hazardous substance and/or toxic waste or
toxic substance, as such terms are defined in the Resource



20









 




Conservation and Recovery Act of 1976, 42 USC 6901 et seq., as amended, the
Comprehensive Environmental Response Compensation and Liability Act of 1980, 42 USC 9601 et
seq., or the Superfund Amendments and Reauthorization Act, Public Law 99-499, as amended, or
any other applicable federal, state or local environmental law, regulation, code or ordinance. To
the best of Seller’s knowledge, there are no pollutants, contaminants or hazardous or toxic wastes,
substances or materials present (except those which occur solely due to their natural presence in
the Real Property and do not, under applicable environmental laws, require remediation,
encapsulation or removal, and except as identified in that certain Report of Findings
Asbestos-Containing Building Materials (ACBM) Inspection prepared by Randolph & Associates, Inc. as
RAI Job #2-1331-005.01 dated August 8-14,1989) in, on or under the Real Property, and the Real
Property does not contain any underground storage tanks in, on or under the surface of any portion
thereof and the Real Property has never contained any such tanks. To the best of Seller’s
knowledge, there is no current violation of any applicable environmental law.




     6. Authorization of Seller. Seller is a trustee under an Illinois land trust, is duly
organized, validly existing and in good standing under the laws of the state of Illinois, is the
sole owner in fee simple of the Real Property (subject only to the Permitted Exceptions and the
Leases) and Towne Realty, Inc. as the authorized beneficiary has the right, power and authority to
execute this Agreement and any/all Seller’s Deliveries under Section 5.2 hereof and to sell the
Property without obtaining the consent, approval, release, or signature of any other party. The
signatories hereto on behalf of Seller have been duly authorized to execute and deliver this
Agreement and to bind Seller hereto. Seller has full power and authority to consummate the
transaction described in this Agreement, the execution and delivery of this Agreement and any/all
Seller’s Deliveries under Section 5.2 hereof by Seller and the consummation by Seller of the
transaction described herein have been duly and validly authorized by all necessary action and the
observance of all required formalities on the part of Seller such that this Agreement constitutes a
valid and legally binding obligation of Seller, enforceable against Seller in accordance with its
terms. Neither the execution and delivery of this Agreement and any/all Seller’s Deliveries under
Section 5.2 hereof nor the consummation by Seller of the transaction contemplated hereby will (i)
conflict with or result in a breach of or default under any of the terms, conditions or provisions
of any note, bond, mortgage, indenture, license, agreement or other instrument or obligation to
which Seller is a party or by which it or the Real Property is bound (including any trust agreement
or other organizational or other governing documents of Seller), or (ii) violate any order,
injunction, decree, statute, rule or regulation applicable to Seller or the Real Property.



     7. Seller’s Knowledge. As used herein, Seller’s knowledge shall be limited to the
actual knowledge of Thomas G. Bernacchi, vice president, whom Seller hereby represents is the
individual who is in the best position to have all relevant knowledge and information concerning
the Property.



     8. Authorization of Beneficiary. Towne Realty, Inc. d/b/a Lincoln Tower, Inc. is the
authorized beneficiary under Trust Number 51-0615-0 dated August 15, 1967, an Illinois Land Trust
(the “Beneficiary”). Beneficiary is duly organized, validly existing and in good standing under
the laws of the state of Illinois and has the right, power and authority to direct (and has
authorized and directed) Seller to execute this Agreement and any/all Seller’s Deliveries under
Section 5.2 hereof and to sell the Property without obtaining the consent, approval, release, or
signature of any other party. Neither the execution and delivery of this Agreement and any/all
Seller’s Deliveries under Section 5.2 hereof nor the consummation by Seller of the transaction
contemplated hereby will (i) conflict with or result in a breach of or default under any of the
terms, conditions or provisions of any note, bond, mortgage, indenture, license, agreement or other
instrument or obligation to which Beneficiary is a party or by which it is bound, or (ii) violate
any order, injunction, decree, statute, rule or regulation applicable to Beneficiary.



     9. Personal Property. With the exception of mortgage lender’s existing
security interest (which will be released at or prior to Closing), Seller owns all of the Personal
Property free and clear of all liens, encumbrance and other third party claims.



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     10. Solvency. To the actual knowledge of Seller, Seller is solvent, has not made
a general assignment for the benefit of its creditors, and has not admitted in writing its
inability to pay its debts as they become due, nor has Seller filed, nor does it contemplate the
filing of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or
any other proceeding for the relief of debtors in general, nor has any such proceeding been
instituted by or against Seller. To Seller’s actual knowledge the sale of the Property pursuant to
this Agreement will not render Seller insolvent.



     11. ERISA. The transaction contemplated by this Agreement (and any underlying
obligations contemplated by this Agreement) does not and shall not constitute a non-exempt
prohibited transaction under ERISA or a comparable violation of state law.



     12. OFAC. Seller is not any of the following: (i) a person or entity that is listed
in the Annex to, or is otherwise subject to the provisions of, Executive Order No. 13224 on
Terrorist Financing (effective September 24, 2001) (herein called the “Executive Order”); (ii) a
person or entity owned or controlled by, or acting for or on behalf of any person or entity that is
listed in the Annex to, or is otherwise subject to the provisions of, the Executive Order; (iii) a
person or entity that is named as a “specifically designated national” or “blocked person” on the
most current list published by the U.S. Treasury Department’s Office of Foreign Assets Control
(herein called “OFAC”) at its official website,
http://www.treas.gov/offices/enforcement/ofac; (iv) a person or entity that is otherwise
the target of any economic sanctions program currently administered by OFAC; or (v) a person or
entity that is affiliated with any person or entity identified in the foregoing clauses (i), (ii),
(iii), or (iv).



     13. Disclosures. To Seller’s actual knowledge, all of the Seller’s Documents
delivered or to be delivered to Buyer are true and complete copies of such documents. To Seller’s
actual knowledge, Seller has used commercially reasonable efforts to disclose to Buyer, in writing
(which disclosure may be by delivery of the Seller’s Documents or the Variances described below),
all material information, knowledge and findings relating to the Property and its operations in
Seller’s possession.



     14. Variance Disclosure. Seller represents that to Seller’s knowledge there are
multiple variances affecting the Real Property on file with the City (“Variances”). Seller does
not have copies of the Variances and is working with the Title Company to secure copies. Seller
reserves the right to modify the warranties and representations contained herein based upon the
information and effect of the Variances.



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EXHIBIT D




Seller’s Documents


DUE DILIGENCE ITEMS LIST




Property Specific



Brochure, Offering Package, etc.

Personal Property Schedule




Operations

Warranties (roof, HVAC, elevator, etc.)

Schedule of Vendors and underlying Vendor Contracts utilized at the property



Landscaping/Snow Removal

Parking Lot Sweeping

Parking Lot Repair

Janitorial/Cleaning

Trash Removal

HVAC

Electrical

Window Repair

Plumbing




O&M Manuals

Personal Property and Supplies Inventory (on site)

Monthly Alarm Monitoring Contract

Any other contracts affecting or pertaining to this property

Copies of all License and Permits

Copies of all Governmental notices pertaining to the property including but not limited to
Building Code, Health Code, Zoning and Fire Code.




List of current on site Staff with Payroll and Benefit Information for Years 2009 and YTD 2010




List of account numbers for any utility accounts

Any existing engineering study or inspection report

All termite inspection reports

Any property management agreement




Tenant Information

Leases for all tenants and all available Tenant Correspondence files (including
amendments/letters/agreements)

The files for residential tenants will not be copied but are on site at the property and
are available for inspection. The files for office tenants will be copied and sent to
Buyer.

Schedule of Leases Under Negotiation or Leases Out for Signature

Rent Roll (showing, unit number, square footage (for commercial tenants only), monthly
rent, deposits, lease term, defaults (financial or otherwise), and such other information
as Buyer may require

Resident Phone List (name, address, phone number)

Tenant Work in Progress

Current Tenant Delinquency Report and status of all files placed for eviction or collection




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Financial (Property Specific)

Current Year Operating Budget

Operating Statements-YTD and 3 year historical

General Ledger-YTD and 3 year historical

Capital-Current Year Budget/ Historical (3 years)

Real estate tax bills, payment and appeals (3 years)

Schedule of Security Deposits and Prepaid Rents

Cash Activity Schedule for December 31, 2009 & 2008 and March 31, 2010 (with bank
reconciliations for said period to be made available to Buyer’s auditors for review at

Seller’s office in the presence of Seller’s representatives, but in no event to be copied
or distributed, if requested by Buyer’s auditors)

Trial balance as of December 31, 2009 and 2008 and for the years then ended

Trial balance as of March 31, 2010 and for the 3 month period then ended

Cash disbursement journals for January through March 2010 and 2009




Construction Issues

Plans & specifications

These files will not be copied but are on site at the property and are available for inspection.




Title and Other

Title Insurance Commitment and all recorded documents referenced therein

Existing survey

Any existing environmental reports or studies

Any existing zoning report or compliance letter

Certificates of Insurance

Insurance loss runs, rental rate history, occupancy percentage by month from 2004 to date




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EXHIBIT E




Rent Roll



To be provided as a Seller Document



25









 





EXHIBIT F




Notice Provisions



     Notices shall be deemed given hereunder upon personal delivery, upon the next business
day after depositing any such notice in the custody of a nationally recognized overnight delivery
service, or upon telecopy or electronic mail (during normal business hours, or, if after normal
business hours, on the next business day). Notices shall be deemed properly addressed if sent to
the following addresses, fax numbers or email addresses:



	 	 	 	 	 	 	 

	 

	 	If to Buyer:
	 	Sarah Metherell
	 	 
	 

	 	 	 	Steadfast Companies	 	 
	 

	 	 	 	4343 Von Karman Avenue	 	 
	 

	 	 	 	Suite 300	 	 
	 

	 	 	 	Newport Beach, CA 92660	 	 
	 

	 	 	 	Fax: (949) 852-0143	 	 
	 

	 	 	 	Email: smetherell@steadfastcompanies.com	 	 
	 
	 	 	 	 	 	 
	 

	 	With a copy to (sent
	 	Virginia A. Davis, Esq.	 	 
	 

	 	simultaneously via
	 	Katten Muchin Rosenman LLP	 	 
	 

	 	the same method of
	 	2900 K Street NW, North Tower — Suite 200	 	 
	 

	 	delivery):
	 	Washington, DC 20007-5118	 	 
	 

	 	 	 	Fax: (202) 298-7570	 	 
	 

	 	 	 	Email: virginia.davis@kattenlaw.com	 	 
	 
	 	 	 	 	 	 
	 

	 	If to Seller:
	 	Mr. Thomas G. Bernacchi	 	 
	 

	 	 	 	c/o Towne Realty, Inc.	 	 
	 

	 	 	 	710 N. Plankinton Avenue, #1400	 	 
	 

	 	 	 	Milwaukee, Wisconsin 53203	 	 
	 

	 	 	 	Fax: (414) 274-2744	 	 
	 

	 	 	 	Email: Tom.Bernacchi@Zilber.com	 	 
	 
	 	 	 	 	 	 
	 

	 	With a copy to (sent
	 	Ms. Sandra J. DeLisle, Esq.	 	 
	 

	 	simultaneously via
	 	Young & Madigan, S.C.	 	 
	 

	 	the same method of
	 	710 N. Plankinton Avenue, #1200	 	 
	 

	 	delivery):
	 	Milwaukee, Wisconsin 53203	 	 
	 

	 	 	 	Fax: (414) 274-2710	 	 
	 

	 	 	 	Email: Sandi.Delisle@Zilber.com	 	 






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EXHIBIT G




Contracts



To be provided as a Seller Document




27