Guaranty, dated August 5, 2008



 EXHIBIT 10.7 
 FHLMC Loan No. 504110004 
 Conifer Crossing 
 GUARANTY 
 MULTISTATE 
 (for use in all Property jurisdictions except California) 
 REVISION DATE 05/06/2005 
 This Guaranty (“Guaranty”) is entered into to be
effective as of August 5, 2008, by the undersigned person(s) (the “Guarantor” jointly and severally if more than one), for the benefit of HOLLIDAY FENOGLIO FOWLER, L.P., a Texas limited partnership (the
“Lender”). 
 RECITALS 
 A. FPA/PRIP Conifer, LLC, a Delaware limited liability company (the “Borrower”) has requested that Lender make a loan to Borrower in the amount of $28,700,000.00 (the “Loan”). The
Loan will be evidenced by a Multifamily Note from Borrower to Lender dated effective as of the effective date of this Guaranty (the “Note”). The Note will be secured by a Multifamily Mortgage, Deed of Trust, or Deed to Secure Debt
dated effective as of the effective date of the Note (the “Security Instrument”), encumbering the Mortgaged Property described in the Security Instrument. 
 B. As a condition to making the Loan to Borrower, Lender requires that the Guarantor execute this Guaranty. 
 NOW, THEREFORE, in order to induce Lender to make the Loan to Borrower, and in consideration thereof, Guarantor agrees as follows: 
 1. Defined Terms. “Indebtedness,” “Loan Documents” and “Property Jurisdiction” and other capitalized terms used but
not defined in this Guaranty shall have the meanings assigned to them in the Security Instrument. 
 2. Scope of Guaranty. 

(a) Guarantor hereby absolutely, unconditionally and irrevocably guarantees to Lender: 
  

	 	(i)	the full and prompt payment when due, whether at the Maturity Date or earlier, by reason of acceleration or otherwise, and at all times thereafter, of each of the following:


  

	 	(A)	a portion of the Indebtedness equal to zero percent (0%) of the original principal balance of the Note (the “Base Guaranty”); and 

  

	 	(B)	in addition to the Base Guaranty, all other amounts for which Borrower is personally liable under Sections 9(c), 9(d) and 9(f) of the Note; and 

  

	 	(C)	all costs and expenses, including reasonable Attorneys’ Fees and Costs incurred by Lender in enforcing its rights under this Guaranty; and 

  

  
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	 	(ii)	the full and prompt payment and performance when due of all of Borrower’s obligations under Section 18 of the Security Instrument. 

 (b) If the Base Guaranty stated in Section 2(a)(i)(A) is 100 percent of the original principal balance of the Note, then (i) the Base Guaranty
shall mean and include the full and complete guaranty of payment of the entire Indebtedness and the performance of all Borrower’s obligations under the Loan Documents; and (ii) for so long as the Base Guaranty remains in effect (there
being no limit to the duration of the Base Guaranty unless otherwise expressly provided in this Guaranty), the obligations guaranteed pursuant to Sections 2(a)(i)(B), 2(a)(i)(C) and Section 3 shall be part of, and not in addition to or in
limitation of, the Base Guaranty. 
 If the Base Guaranty stated in Section 2(a)(i)(A) is less than 100 percent of the original
principal balance of the Note, then this Section 2(b) shall be completely inapplicable and shall be treated as if not a part of this Guaranty. 
 (c) If Guarantor is not liable for the entire Indebtedness, then all payments made by Borrower with respect to the Indebtedness and all amounts received by Lender from the enforcement of its rights under the Security Instrument and the
other Loan Documents (except this Guaranty) shall be applied first to the portion of the Indebtedness for which neither Borrower nor Guarantor has personal liability. 
 3. Additional Guaranty Relating to Bankruptcy. 
 (a) Notwithstanding any limitation on liability
provided for elsewhere in this Guaranty, Guarantor hereby absolutely, unconditionally and irrevocably guarantees to Lender the full and prompt payment when due, whether at the Maturity Date or earlier, by reason of acceleration or otherwise, and at
all times thereafter, the entire Indebtedness, in the event that: 
  

	 	(i)	Borrower voluntarily files for bankruptcy protection under the United States Bankruptcy Code; or 

  

	 	(ii)	Borrower voluntarily becomes subject to any reorganization, receivership, insolvency proceeding, or other similar proceeding pursuant to any other federal or state law affecting
debtor and creditor rights; or 

  

	 	(iii)	an order of relief is entered against Borrower pursuant to the United States Bankruptcy Code or other federal or state law affecting debtor and creditor rights in any involuntary
bankruptcy proceeding initiated or joined in by a “Related Party.” 

 (b) For purposes of this Section, the
term “Related Party” means: 
  

	 	(i)	Borrower or Guarantor; and 

  

	 	(ii)	any person or entity that holds, directly or indirectly, any ownership interest in or right to manage Borrower or Guarantor, including without limitation, any shareholder, member or
partner of Borrower or Guarantor; and 

  

	 	(iii)	any person or entity in which any ownership interest (direct or indirect) or right to manage is held by Borrower, Guarantor or any partner, shareholder or member of, or any other
person or entity holding an interest in, Borrower or Guarantor; and 

  

  
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	 	(iv)	any other creditor of Borrower that is related by blood, marriage or adoption to Borrower, Guarantor or any partner, shareholder or member of, or any other person or entity holding
an interest in, Borrower or Guarantor. 

 (c) If Borrower, Guarantor or any Related Party has solicited creditors to initiate
or participate in any proceeding referred to in this Section, regardless of whether any of the creditors solicited actually initiates or participates in the proceeding, then such proceeding shall be considered as having been initiated by a Related
Party. 
 4. Guarantor’s Obligations Survive Foreclosure. The obligations of Guarantor under this Guaranty shall survive any
foreclosure proceeding, any foreclosure sale, any delivery of any deed in lieu of foreclosure, and any release of record of the Security Instrument, and, in addition, the obligations of Guarantor relating to Borrower’s obligations under
Section 18 of the Security Instrument shall survive any repayment or discharge of the Indebtedness. Notwithstanding the foregoing, if Lender has never been a mortgagee-in-possession of or held title to the Mortgaged Property, Guarantor shall
have no obligation under this Guaranty relating to Borrower’s obligations under Section 18 of the Security Instrument after the date of the release of record of the lien of the Security Instrument as a result of the payment in full of the
Indebtedness on the Maturity Date or by voluntary prepayment in full. 
 5. Guaranty of Payment and Performance. Guarantor’s
obligations under this Guaranty constitute an unconditional guaranty of payment and performance and not merely a guaranty of collection. 
 6. No Demand by Lender Necessary; Waivers by Guarantor. The obligations of Guarantor under this Guaranty shall be performed without demand by Lender and shall be unconditional regardless of the genuineness, validity, regularity or
enforceability of the Note, the Security Instrument, or any other Loan Document, and without regard to any other circumstance which might otherwise constitute a legal or equitable discharge of a surety, a guarantor, a borrower or a mortgagor.
Guarantor hereby waives, to the fullest extent permitted by applicable law: 
 (a) the benefit of all principles or provisions of law,
statutory or otherwise, which are or might be in conflict with the terms of this Guaranty and agrees that Guarantor’s obligations shall not be affected by any circumstances, whether or not referred to in this Guaranty, which might otherwise
constitute a legal or equitable discharge of a surety, a guarantor, a borrower or a mortgagor; 
 (b) the benefits of any right of discharge
under any and all statutes or other laws relating to a guarantor, a surety, a borrower or a mortgagor, and any other rights of a surety, a guarantor, a borrower or a mortgagor under such statutes or laws; 
 (c) diligence in collecting the Indebtedness, presentment, demand for payment, protest, all notices with respect to the Note and this Guaranty which may
be required by statute, rule of law or otherwise to preserve Lender’s rights against Guarantor under this Guaranty, including, but not limited to, notice of acceptance, notice of any amendment of the Loan Documents, notice of the
occurrence of any default or Event of Default, notice of intent to accelerate, notice of acceleration, notice of dishonor, notice of foreclosure, notice of protest, and notice of the incurring by Borrower of any obligation or indebtedness;

  

  
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 (d) all rights to cause a marshalling of the Borrower’s assets or to require Lender to: 

 

	 	(i)	proceed against Borrower or any other guarantor of Borrower’s payment or performance under the Loan Documents (an “Other Guarantor”); 


 

	 	(ii)	proceed against any general partner of Borrower or any Other Guarantor if Borrower or any Other Guarantor is a partnership; 

  

	 	(iii)	proceed against or exhaust any collateral held by Lender to secure the repayment of the Indebtedness; or 

  

	 	(iv)	pursue any other remedy it may now or hereafter have against Borrower, or, if Borrower is a partnership, any general partner of Borrower; 

 (e) any right to object to the timing, manner or conduct of Lender’s enforcement of its rights under any of the Loan Documents; and 
 (f) any right to revoke this Guaranty as to any future advances by Lender under the terms of the Security Instrument to protect Lender’s interest in
the Mortgaged Property. 
 7. Modification of Loan Documents. At any time or from time to time and any number of times, without notice
to Guarantor and without affecting the liability of Guarantor, Lender may: 
 (a) extend the time for payment of the principal of or interest
on the Indebtedness or renew the Indebtedness in whole or in part; 
 (b) extend the time for Borrower’s performance of or compliance
with any covenant or agreement contained in the Note, the Security Instrument or any other Loan Document, whether presently existing or hereinafter entered into, or waive such performance or compliance; 
 (c) accelerate the Maturity Date of the Indebtedness as provided in the Note, the Security Instrument, or any other Loan Document; 
 (d) with Borrower, modify or amend the Note, the Security Instrument, or any other Loan Document in any respect, including, but not limited to, an
increase in the principal amount; and/or 
 (e) modify, exchange, surrender or otherwise deal with any security for the Indebtedness or
accept additional security that is pledged or mortgaged for the Indebtedness. 
 8. Joint and Several Liability. The obligations of
Guarantor (and each party named as a Guarantor in this Guaranty) and any Other Guarantor shall be joint and several. Lender, in its sole and absolute discretion, may: 
 (a) bring suit against Guarantor, or any one or more of the parties named as a Guarantor in this Guaranty, and any Other Guarantor, jointly and severally, or against any one or more of them; 
  

  
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 (b) compromise or settle with Guarantor, any one or more of the parties named as a Guarantor in this
Guaranty, or any Other Guarantor, for such consideration as Lender may deem proper; 
 (c) release one or more of the parties named as a
Guarantor in this Guaranty, or any Other Guarantor, from liability; and 
 (d) otherwise deal with Guarantor and any Other Guarantor, or any
one or more of them, in any manner, and no such action shall impair the rights of Lender to collect from Guarantor any amount guaranteed by Guarantor under this Guaranty. 
 9. Subordination of Borrower’s Indebtedness to Guarantor. Any indebtedness of Borrower held by Guarantor now or in the future is and shall be subordinated to the Indebtedness and Guarantor shall collect,
enforce and receive any such indebtedness of Borrower as trustee for Lender, but without reducing or affecting in any manner the liability of Guarantor under the other provisions of this Guaranty. 
 10. Waiver of Subrogation. Guarantor shall have no right of, and hereby waives any claim for, subrogation or reimbursement against Borrower or any
general partner of Borrower by reason of any payment by Guarantor under this Guaranty, whether such right or claim arises at law or in equity or under any contract or statute, until the Indebtedness has been paid in full and there has expired the
maximum possible period thereafter during which any payment made by Borrower to Lender with respect to the Indebtedness could be deemed a preference under the United States Bankruptcy Code. 
 11. Preference. If any payment by Borrower is held to constitute a preference under any applicable bankruptcy, insolvency, or similar laws, or if
for any other reason Lender is required to refund any sums to Borrower, such refund shall not constitute a release of any liability of Guarantor under this Guaranty. It is the intention of Lender and Guarantor that Guarantor’s obligations under
this Guaranty shall not be discharged except by Guarantor’s performance of such obligations and then only to the extent of such performance. 
 12. Financial Statements. Guarantor, from time to time upon written request by Lender, shall deliver to Lender such financial statements as Lender may reasonably require. 
 13. Assignment. Lender may assign its rights under this Guaranty in whole or in part and upon any such assignment, all the terms and provisions of
this Guaranty shall inure to the benefit of such assignee to the extent so assigned. The terms used to designate any of the parties herein shall be deemed to include the heirs, legal representatives, successors and assigns of such parties, and the
term “Lender” shall also include any lawful owner, holder or pledgee of the Note. Reference in this Guaranty to “person” or “persons” shall be deemed to include individuals and entities. 
 14. Complete and Final Agreement. This Guaranty and the other Loan Documents represent the final agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous or subsequent oral agreements. There are no unwritten oral agreements between the parties. All prior or contemporaneous agreements, understandings, representations, and statements, oral or written,
are merged into this Guaranty and the other Loan Documents. Guarantor acknowledges that Guarantor has received a copy of the Note and all other Loan Documents. Neither this Guaranty nor any of its provisions may be waived, modified, amended,
discharged, or terminated except by a writing signed by the party against which the enforcement of the waiver, modification, amendment, discharge, or termination is sought, and then only to the extent set forth in that writing. 
  

  
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 15. Governing Law. This Guaranty shall be governed by and enforced in accordance with the laws of
the Property Jurisdiction, without giving effect to the choice of law principles of the Property Jurisdiction that would require the application of the laws of a jurisdiction other than the Property Jurisdiction. 
 16. Jurisdiction; Venue. Guarantor agrees that any controversy arising under or in relation to this Guaranty may be litigated in the Property
Jurisdiction, and that the state and federal courts and authorities with jurisdiction in the Property Jurisdiction shall have jurisdiction over all controversies which shall arise under or in relation to this Guaranty. Guarantor irrevocably consents
to service, jurisdiction and venue of such courts for any such litigation and waives any other venue to which it might be entitled by virtue of domicile, habitual residence or otherwise. However, nothing herein is intended to limit Lender’s
right to bring any suit, action or proceeding relating to matters arising under this Guaranty against Guarantor or any of Guarantor’s assets in any court of any other jurisdiction. 
 17. Guarantor’s Interest in Borrower. Guarantor represents to Lender that Guarantor has a direct or indirect ownership or other financial
interest in Borrower and/or will otherwise derive a material financial benefit from the making of the Loan. 
 18. STATE-SPECIFIC
PROVISIONS: Guarantor waives the benefit of O.C.G.A. Section 10-7-24. 
 19. Residence; Community Property Provision.

       (a) Guarantor represents and warrants that his/her state of residence is CA. 
       (b) Guarantor warrants and represents that s/he is: 
       [            ] single 
       [x] married 
 [If Guarantor is married and the Guarantor’s residence is a community property jurisdiction (other than California) (AZ, ID, LA, NV, NM, TX, WI), insert the first subsection (c). If the Guarantor is a married individual and
resides in California, insert the second subsection (c). In all other instances, delete both of the following subsections (c). 
       (c) Any one signing this Guaranty solely as the spouse of a Guarantor will bind only his/her marital community property and community assets and will not bind his/her sole and separate property and
assets, if any, to the payment and performance of obligations under this Guaranty. 
       (d) Guarantor is a
married individual residing in California. Guarantor acknowledges that this Guaranty is with recourse against the separate property and assets of such individual and against the marital community property and assets of such individual and his or her
spouse. 
 20. GUARANTOR AND LENDER EACH (A) AGREES NOT TO ELECT A TRIAL BY JURY WITH RESPECT TO ANY ISSUE ARISING OUT OF THIS
GUARANTY OR THE RELATIONSHIP BETWEEN THE PARTIES AS GUARANTOR AND LENDER THAT IS TRIABLE OF RIGHT BY A JURY AND (B) WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO SUCH ISSUE TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN THE FUTURE. THIS
WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN BY EACH PARTY, KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL COUNSEL. 
  

  
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 ATTACHED EXHIBIT. The following Exhibit is attached to this Guaranty: 
  

					
	 x
	  	Exhibit A	 	                Modifications to Guaranty

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

  
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	 /s/    Gregory A. Fowler
            (SEAL)

	 Gregory A. Fowler, Individually and as Trustee of
 the
Gregory A. Fowler Living Trust



  

	
	Signed, sealed and delivered in the presence of:
	
	 /s/    Monica Hill

	
	Print Name: Monica Hill, Unofficial Witness
	
	 /s/    N.
Wickham            (SEAL)

	Notary Public, Orange County,
	California

 Date: 8-1-08 
 My Commission Expires:                     
  

  
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 [IF THE GUARANTOR’S RESIDENCE IS A COMMUNITY PROPERTY STATE, 
 INCLUDE SPOUSAL CONSENT] 
 Elizabeth A. Fowler
(the “Non-Guarantor Spouse”) is signing this Guaranty solely as the spouse of the Guarantor to bind the marital community property and community assets and is not signing this Guaranty to bind the Non-Guarantor’s sole and
separate property or assets, if any, for the payment and performance of obligations under the Guaranty. 
  

			
	 Elizabeth A.
Fowler            (SEAL)

	[Name]	 	


  

	
	Signed, sealed and delivered in the presence of:
	
	 /s/    Monica Hill

	
	Print Name: Monica Hill, Unofficial Witness
	
	 N. Wickham            (SEAL)

	Notary Public, Orange County,
	California

 Date: 8-1-08 
 My Commission Expires:                     
  

  
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	Names and Address(es) of Guarantor(s):
		
	Name:	 	Gregory A. Fowler
	Address:	 	Fowler Property Acquisitions, LLC
		 	100 Bush Street, Suite 510
		 	San Francisco, CA 94104
		
		 	[Spouse’s
Name:                                    
]
		
		 	[Spouse’s
Address:                                    

		 	                                       
                                 ]

  

  
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 EXHIBIT A 
 MODIFICATIONS TO GUARANTY 
 The following modifications are made to the text of the Guaranty that precedes this Exhibit:

 1. Section 2(a)(i)(A) of the Guaranty is deleted and replaced with the following: 
 “A portion of the Indebtedness equal to $1,465,000 (the “Base Guaranty”). 
 The liability of Guarantor under this Section 2(a)(i)(A) only will be reduced to zero if all of the following conditions have been met: 

(1) Lender has received a written request from the Guarantor for the reduction of the Base Guaranty to zero (“Release Request”), which
Release Request may not be given prior to the last day of the third calendar month following the date of this Guaranty or later than the last day of the first calendar month following the Completion Date specified in the Acquisition Repair Agreement
or Acquisition Repair Escrow Agreement, as applicable. 
 (2) Borrower has provided Lender with a certified rent schedule, income and expense
statements, and other documentation required by Lender, demonstrating, to Lender’s satisfaction, (a) that the actual monthly occupancy of the residential units at the Mortgaged Property has been at least 95% for the three consecutive month
period (“Performance Period”) prior to the Releases Request; and (b) the debt coverage ratio (“DCR”) (regardless of whether or not the loan is in the interest-only period, the debt service coverage ratio will
be based on debt service that is amortizing a 30-year schedule) for the Mortgage has not been less than 1.15:1 for the Performance Period. 
 (3) There is not an Event of Default under any Loan Document or any event that with the giving of notice or the passage of time would become an Event of Default. 
 (4) The requirements of the Acquisition Repair Agreement (or Acquisition Repair Escrow Agreement), as applicable, executed by Borrower in connection with the Mortgage have been fully satisfied. 
 Failure to satisfy the requirements for the reduction of the Base Guaranty to ero as provided herein shall result in the Base Guaranty remaining in place
for the term of the Mortgage.” 
  

  
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