exv10w2









    Exhibit 10.2



 




    Agreement
    and Plan of Conversion and Merger



 



    AGREEMENT AND PLAN OF CONVERSION AND MERGER (this
    “Agreement”), dated as of July 28, 2011,
    by and among National Property Investors 4, a California limited
    partnership (“NPI”), AIMCO NPI 4 Merger Sub
    LLC, a Delaware limited liability company (the “Aimco
    Subsidiary”), and Aimco Properties, L.P., a Delaware
    limited partnership (“Aimco OP”).



 



    WHEREAS, NPI Equity Investments, Inc., the managing general
    partner of NPI and New NPI (“NPI Equity”), has
    determined that the conversion of NPI into a Delaware limited
    partnership named National Property Investors 4, LP
    (“New NPI”), and the subsequent merger of the
    Aimco Subsidiary with and into New NPI, with New NPI as the
    surviving entity, in each case, on the terms set forth herein,
    are advisable, fair to and in the best interests of NPI and New
    NPI and their respective partners; and



 



    WHEREAS, Aimco OP is the sole member of the Aimco Subsidiary and
    the sole limited partner of New NPI; and



 



    WHEREAS, the Board of Directors of AIMCO-GP, Inc., the general
    partner of Aimco OP (“AIMCO-GP”), has
    determined that the conversion of NPI into New NPI, and the
    subsequent merger of the Aimco Subsidiary with and into New NPI,
    with New NPI as the surviving entity, in each case, on the terms
    as set forth herein, are advisable and in the best interests of
    Aimco OP and its partners, and the Aimco Subsidiary; and



 



    WHEREAS, the parties desire to enter this Agreement to evidence
    the terms, provisions, representations, warranties, covenants
    and conditions upon which the Conversion and Merger (as defined
    below) will be consummated.



 



    NOW, THEREFORE, in consideration of the mutual agreements and
    covenants set forth herein, and for other good and valuable
    consideration, the adequacy, sufficiency, and receipt of which
    are hereby acknowledged, the parties hereby agree as follows:



 



    Section 1.  The
    Conversion.  Subject to the terms and
    conditions set forth herein, NPI shall be converted into New NPI
    (the “Conversion”), with New NPI as the
    surviving entity (the “First Surviving
    Entity”). As soon as practicable after all of the
    conditions to the Conversion set forth herein have been
    satisfied, NPI and New NPI shall (i) execute a certificate
    of conversion and cause such certificate to be filed with the
    Secretary of State of the State of California and
    (ii) execute a certificate of conversion and cause such
    certificate to be filed with the Secretary of State of the State
    of Delaware. The Conversion shall become effective upon the
    filing of such certificates (the “First Effective
    Time”). At the First Effective Time, the Conversion
    shall have the effect provided by applicable law and this
    Agreement, including, but not limited to, the following
    consequences:



 



    (a) Certificate of Limited
    Partnership.  The certificate of limited
    partnership of New NPI in effect immediately prior to the First
    Effective Time shall be the certificate of limited partnership
    of the First Surviving Entity unless and until subsequently
    amended.



 



    (b) Partnership Agreement.  The
    limited partnership agreement of NPI in effect immediately prior
    to the First Effective Time, as amended as set forth on
    Exhibit A hereto, shall be the partnership agreement
    of the First Surviving Entity unless and until subsequently
    amended. The general partners and each limited partner of the
    First Surviving Entity shall have the rights under, be bound by
    and be subject to the terms and conditions of, such partnership
    agreement.



 



    (c) General Partner.  NPI Equity
    shall be the managing general partner of the First Surviving
    Entity.



 



    (d) Conversion of Equity Interests.



 



    (i) Interests in NPI.  Each general
    partnership interest of NPI outstanding immediately prior to the
    First Effective Time and held by a general partner shall be
    converted into an equivalent general partnership interest in the
    First Surviving Entity (each new general partnership interest, a
    “New NPI GP Interest”). Each unit of






    

    1








 







    limited partnership interest of NPI outstanding immediately
    prior to the First Effective Time shall be converted into an
    equivalent unit of limited partnership interest in the First
    Surviving Entity (a “New NPI Unit”).



 



    (ii) Interests in New NPI.  The
    interest of each partner in New NPI immediately prior to the
    First Effective Time shall be cancelled.



 



    Section 2.  The
    Merger.  Subject to the terms and conditions
    set forth herein, immediately following the First Effective
    Time, the Aimco Subsidiary shall be merged with and into New NPI
    (the “Merger” and, together with the
    Conversion, the “Mergers”), with New NPI as the
    surviving entity (the “Second Surviving
    Entity”). As soon as practicable after all of the
    conditions to the Merger set forth herein have been satisfied,
    New NPI shall cause to be filed a certificate of merger with
    respect to the Merger with the Secretary of State of the State
    of Delaware. The Merger shall become effective upon the filing
    of such certificate (the “Second Effective
    Time”). At the Second Effective Time, the Merger shall
    have the effect provided by applicable law and this Agreement,
    including, but not limited to, the following consequences:



 



    (a) Certificate of Limited
    Partnership.  The certificate of limited
    partnership of New NPI in effect immediately prior to the Second
    Effective Time shall be the certificate of limited partnership
    of the Second Surviving Entity unless and until subsequently
    amended.



 



    (b) Partnership Agreement.  The
    limited partnership agreement of New NPI in effect immediately
    prior to the Second Effective Time shall be the partnership
    agreement of the Second Surviving Entity (the
    “Partnership Agreement”) unless and until
    subsequently amended. The general partners and each limited
    partner of the Second Surviving Entity shall have the rights
    under, be bound by and be subject to the terms and conditions
    of, the Partnership Agreement.



 



    (c) General Partners.  NPI Equity
    shall be the managing general partner of the Second Surviving
    Entity.



 



    (d) Treatment of Limited Partners Interests in New
    NPI.



 



    (i) In connection with the Merger and in accordance with
    the procedures set forth in Section 2(d)(iii) hereto, each
    New NPI Unit outstanding immediately prior to the Second
    Effective Time, except New NPI Units held by limited partners
    who have perfected their appraisal rights pursuant to
    Exhibit B hereto, shall be converted into the right
    to receive, at the election of the holder thereof, either
    (x) $195.27 in cash (the “Cash
    Consideration”) or (y) a number of partnership
    common units (“OP Units”) of Aimco OP
    calculated by dividing $195.27 by the average closing price of
    Apartment Investment and Management Company common stock, as
    reported on the NYSE, over the ten consecutive trading days
    ending on the second trading day immediately prior to the date
    of the Second Effective Time (the “OP Unit
    Consideration,” and, together with the Cash
    Consideration, the “Merger Consideration”).



 



    (ii) Notwithstanding Section 2(d)(i), if Aimco OP
    determines that the law of the state or other jurisdiction in
    which a holder of New NPI Units resides would prohibit the
    issuance of OP Units in that state or jurisdiction, or that
    the registration or qualification in that state or other
    jurisdiction would be prohibitively costly (each such state or
    jurisdiction, a “Specified Jurisdiction”), then
    such holder will only be entitled to receive the Cash
    Consideration for each New NPI Unit.



 



    (iii) Aimco OP shall prepare a form of election (the
    “Election Form”) describing the Merger,
    pursuant to which each holder of New NPI Units will have the
    right to elect to receive either the Cash Consideration or the
    OP Unit Consideration (subject to Section 2(d)(ii)).
    Aimco OP shall mail or cause to be mailed an Election Form to
    each holder of New NPI Units, together with any other materials
    that Aimco OP determines to be necessary or prudent, no later
    than ten (10) days after the Second Effective Time. An
    election to receive the Cash Consideration or the OP Unit
    Consideration shall be effective only if a properly executed
    Election Form is received by Aimco OP or its designees prior to
    5:00 p.m., New York Time, on the day that is thirty
    (30) days after the mailing of such Election Form by Aimco
    OP. If a holder New NPI Units fails to return a duly completed
    Election Form within the time period specified in the Election
    Form, such holder shall be deemed to have elected to receive the
    Cash Consideration. In addition, each holder of New NPI Units
    that resides in a Specified Jurisdiction will be deemed to have
    elected the Cash Consideration. NPI, New NPI, the Aimco






    

    2








 







    Subsidiary and Aimco OP agree that holders of New NPI Units
    shall have the right to revoke any election made in connection
    with the Merger at any time prior to the expiration of the time
    period stated in the Election Form. Aimco OP and NPI Equity, by
    mutual agreement, shall have the right to make rules, not
    inconsistent with the terms of this Agreement, governing the
    validity of Election Forms and the issuance and delivery of the
    Merger Consideration, as applicable.



 



    (e) Treatment of General Partners’
    Interests.  Each New NPI GP Interest
    outstanding immediately prior to consummation of the Merger
    shall remain outstanding and unchanged, with all of the rights
    set forth in the Partnership Agreement.



 



    (f) Treatment of Interests in the Aimco
    Subsidiary.  The entire membership interest in
    the Aimco Subsidiary immediately prior to the Second Effective
    Time shall be converted into one hundred (100) New NPI
    Units of the Second Surviving Entity.



 



    Section 3.  Appraisal
    Rights.  In connection with the Conversion,
    none of the partners in NPI or New NPI will have any
    dissenters’ appraisal rights. In connection with the
    Merger, the holders of New NPI Units immediately prior to the
    Merger shall have the appraisal rights set forth in
    Exhibit B hereto.



 



    Section 4.  Covenants.  Aimco
    OP agrees to pay for, or reimburse NPI and New NPI for, all
    expenses incurred by NPI and New NPI in connection with the
    Mergers and the transactions contemplated hereby. Aimco OP
    agrees to pay cash or issue and deliver OP Units to the
    former holders of New NPI Units, in accordance with
    Section 2(d) of this Agreement.



 



    Section 5.  Conditions
    to the Mergers.



 



    (a) Neither the Conversion or the Merger shall occur unless
    and until such transaction has been approved or consented to by
    a majority in interest of the limited partnership interests of
    NPI.



 



    (b) Notwithstanding any provisions of this Agreement to the
    contrary, none of the parties hereto shall be required to
    consummate the transactions contemplated hereby if any
    third-party consent, authorization or approval that any of the
    parties hereto deem necessary or desirable in connection with
    this Agreement, or the consummation of the transactions
    contemplated hereby, has not been obtained or received.



 



    Section 6.  Tax
    Treatment.



 



    (a) Conversion.  The parties hereto
    acknowledge and agree that for federal income tax purposes, the
    Conversion will be treated as follows:



 



    (i) The Conversion shall not be treated as a realization
    event, and in accordance therewith, the First Surviving Entity
    shall be treated as the continuation of NPI for federal income
    tax purposes; and



 



    (ii) In accordance with the foregoing, the tax bases of the
    general partners and limited partners of the First Surviving
    Entity in their First Surviving Entity interests and the
    respective initial capital account balances of the general
    partners and limited partners of the First Surviving Entity
    immediately following the First Effective Time shall be the same
    as those of the general partners and the limited partners of NPI
    immediately prior to the First Effective Time.



 



    (b) Merger.  The parties hereto
    intend and agree that, for Federal income tax purposes,
    (i) any payment of cash for New NPI Units shall be treated
    as a sale of such New NPI Units by such holder and a purchase of
    such New NPI Units by Aimco OP for the cash so paid under the
    terms of this Agreement, and (ii) each such holder of New
    NPI Units who accepts cash explicitly agrees and consents to
    such treatment. Furthermore, the parties hereto intend and agree
    that, for Federal income tax purposes, (x) any exchange of
    New NPI Units for OP Units under the terms of this
    Agreement shall be treated as the contribution of New NPI Units
    to Aimco OP in exchange for Aimco OP Units, in accordance
    with Section 721 of the Internal Revenue Code of 1986, as
    amended, and (y) each such holder of New NPI Units who
    accepts OP Units explicitly agrees and consents to such
    treatment. Any cash
    and/or
    OP Units to which a holder of New NPI Units is entitled
    pursuant to this Agreement shall be paid only after the receipt
    of a consent from such holder that, for Federal income tax
    purposes, the receipt of cash
    and/or
    OP Units shall be treated as described in this
    Section 6(b).





    

    3








 







    Section 7.  Further
    Assurances.



 



    (a) From time to time, as and when required by the First
    Surviving Entity or by its successors and assigns, there shall
    be executed and delivered on behalf of NPI such deeds and other
    instruments, and there shall be taken or caused to be taken by
    NPI all such further actions, as shall be appropriate or
    necessary in order to vest, perfect or confirm, of record or
    otherwise, in the First Surviving Entity the title to and
    possession of all property, interests, assets, rights,
    privileges, immunities, powers, franchises and authority of NPI,
    and otherwise to carry out the purposes of this Agreement, and
    the officers and directors of NPI Equity are fully authorized in
    the name and on behalf NPI or otherwise to take any and all such
    action and to execute and deliver any and all such deeds and
    other instruments.



 



    (b) From time to time, as and when required by the Second
    Surviving Entity or by its successors and assigns, there shall
    be executed and delivered on behalf of the Aimco Subsidiary such
    deeds and other instruments, and there shall be taken or caused
    to be taken by the Aimco Subsidiary all such further actions, as
    shall be appropriate or necessary in order to vest, perfect or
    confirm, of record or otherwise, in the Second Surviving Entity
    title to and possession of all property, interests, assets,
    rights, privileges, immunities, powers, franchises and authority
    of the Aimco Subsidiary, and otherwise to carry out the purposes
    of this Agreement, and the officers and directors of NPI Equity
    are fully authorized in the name and on behalf of Aimco
    Subsidiary or otherwise to take any and all such action and to
    execute and deliver any and all such deeds and other instruments.



 



    Section 8.  Amendment.  Subject
    to applicable law, this Agreement may be amended, modified or
    supplemented by written agreement of the parties hereto at any
    time prior to the consummation of the Mergers with respect to
    any of the terms contained herein.



 



    Section 9.  Abandonment.  At
    any time prior to consummation of the Mergers, this Agreement
    may be terminated and the Mergers may be abandoned without
    liability to any party hereto by any of the Aimco Subsidiary,
    Aimco OP, NPI or New NPI, in each case, acting in its sole
    discretion and for any reason or for no reason, notwithstanding
    approval of this Agreement by any of the members of the Aimco
    Subsidiary, the partners of NPI or the general partner of Aimco
    OP.



 



    Section 10.  Governing
    Law.  This Agreement shall be governed by and
    construed in accordance with the laws of the State of Delaware,
    without reference to the conflict of law provisions thereof.



 



    Section 11.  No
    Third-Party Beneficiaries.  No provision of
    this Agreement is intended to confer upon any person, entity, or
    organization other than the parties hereto any rights or
    remedies hereunder, other than the appraisal rights given to
    holders of New NPI Units pursuant to Section 3.





    

    4








 







    IN WITNESS WHEREOF, the parties hereto have caused this
    Agreement to be executed as of the date first above written.



 



    NATIONAL PROPERTY INVESTORS 4

    



 


			
	 	    By:
	
    NPI Equity Investments, Inc.,

    Its Managing General Partner




 


			
	 	    By: 
	
    /s/  Trent
    A. Johnson









    Name:     Trent A. Johnson



			
	 	    Title: 
	
    Vice President and Assistant General Counsel




 



    AIMCO NPI 4 MERGER SUB LLC

    



 


			
	 	    By: 
	
    Aimco Properties, L.P.,

    Its Sole Member





 


			
	 	    By: 
	
    AIMCO-GP, Inc.

    Its General Partner

	 
	 	    By: 
	
    /s/  Trent
    A. Johnson









    Name:     Trent A. Johnson



			
	 	    Title: 
	
    Vice President and Assistant General Counsel




 



    AIMCO PROPERTIES, L.P.

    



 


			
	 	    By: 
	
    AIMCO-GP, Inc.,

    Its General Partner

	 
	 	    By: 
	
    /s/  Trent
    A. Johnson









    Name:     Trent A. Johnson



			
	 	    Title: 
	
    Vice President and Assistant General Counsel




 



    [Signature Page — Merger Agreement]





    

    5








 








    EXHIBIT A



 




    FORM OF
    AMENDMENT

    TO

    PARTNERSHIP AGREEMENT

    OF

    NATIONAL PROPERTY INVESTORS 4



 



    This AMENDMENT TO THE PARTNERSHIP AGREEMENT OF NATIONAL PROPERTY
    INVESTORS 4 (this “Amendment”) is entered into
    as
    of          ,
    2011 by and among NPI Equity Investments, Inc., a Florida
    corporation, in its capacity as managing general partner (the
    “Managing General Partner”), and each of the
    Limited Partners. All capitalized terms used in this Amendment
    but not otherwise defined herein shall have the respective
    meanings given to them in the Partnership Agreement (as defined
    below).



 




    Recitals



 



    WHEREAS, National Property Investors 4, a California limited
    partnership (the “Partnership”), is governed
    pursuant to the terms of that certain Partnership Agreement,
    dated as of July 1, 1980, as amended and restated
    July 14, 1980 and as further amended to date (the
    “Partnership Agreement”);



 



    WHEREAS, the Partnership and National Property Investors 4, LP,
    a Delaware limited partnership (the “Delaware
    Partnership”), are parties to an Agreement and Plan of
    Conversion and Merger, dated as of July 28, 2011 (the
    “Merger Agreement”);



 



    WHEREAS, pursuant to the Merger Agreement, the Partnership will
    be converted into the Delaware Partnership;



 



    WHEREAS, pursuant to the Merger Agreement, at the effective time
    of the conversion, the Partnership Agreement, as further amended
    by this Amendment, will become the partnership agreement of the
    Delaware Partnership; and



 



    WHEREAS, the conversion will be effected upon the approval or
    consent of (i) the managing general partner of each of the
    Partnership and the Delaware Partnership, and (ii) a
    majority in interest of the limited partners of each of the
    Partnership and the Delaware Partnership.



 



    NOW, THEREFORE, in consideration of the premises, the agreement
    of the parties herein contained, and other good and valuable
    consideration, the receipt and sufficiency of which are hereby
    acknowledged and confessed, the parties hereby agree as follows:



 



    1. Amendments to the Partnership
    Agreement.  At the effective time of
    the Conversion, the Partnership Agreement shall be amended as
    follows:



 



    (a) In the first paragraph of the Partnership Agreement,
    the following words are deleted: “pursuant to the Uniform
    Limited Partnership Act of the State of California.”



 



    (b) All other references therein to the Uniform Limited
    Partnership Act of the State of California or to the Uniform
    Limited Partnership Act of California shall be deemed to refer
    to the Delaware Revised Uniform Limited Partnership Act.



 



    (c) Section 1 of the Partnership Agreement is hereby
    amended and restated to read in its entirety as follows:



 



    “1.1 The name of the Partnership is National Property
    Investors 4, LP, and its principal place of business is 55
    Beattie Place, P.O. Box 1089, Greenville, South
    Carolina 29602 and thereafter such other place or places as the
    Managing General Partner may from time to time determine.



 



    1.2 National Property Investors 4 was originally formed as
    a limited partnership (the “California Partnership”)
    pursuant to the provisions of the California Uniform Limited
    Partnership Act, upon the terms and conditions set forth in an
    agreement made as of July 1, 1980. Pursuant to an






    

    6








 







    Agreement and Plan of Conversion and Merger, dated as of
    July 28, 2011, by and between the California Partnership
    and National Property Investors 4, LP, a Delaware limited
    partnership (the “Delaware Partnership”), the
    California Partnership was converted into the Delaware
    Partnership (the “Surviving Entity”) in the conversion
    (the “Conversion”). At the effective time of the
    Conversion (the “Effective Time”), the Conversion had
    the effect provided by applicable law, and the following
    consequences: (a) the certificate of limited partnership of
    the Delaware Partnership in effect immediately prior to the
    Effective Time became the certificate of limited partnership of
    the Surviving Entity; (b) the limited partnership agreement
    of the California Partnership in effect immediately prior to the
    Effective Time, as amended as set forth on Annex A to the
    Merger Agreement, became the partnership agreement of the
    Surviving Entity (as so amended, the “Partnership
    Agreement”); (c) NPI Equity Investments, Inc., a
    Florida corporation, remained as sole Managing General Partner
    of the Surviving Entity, and its interest in the California
    Partnership immediately prior to the Effective Time was
    converted into an equivalent interest in the Surviving Entity;
    (d) the interests of the general partner in the Delaware
    Partnership immediately prior to the Effective Time was
    cancelled; (e) each limited partner in the California
    Partnership became a limited partner in the Surviving Entity,
    with an interest in the Surviving Entity equivalent to the
    interest such limited partner had in the California Partnership
    immediately prior to the Effective Time; and (f) the
    interest of each limited partner in the Delaware Partnership
    immediately prior to the Effective Time was cancelled.
    References herein to the “Partnership” are to the
    California Partnership prior to the Conversion and to the
    Delaware Partnership, as the Surviving Entity in the Conversion,
    from and after the Effective Time.”



 



    (d) Section 2.1.16 of the Partnership Agreement is
    hereby amended and restated to read in its entirety as follows:



 



    “2.1.16 “General Partner” shall refer to NPI
    Equity Investments, Inc., a Florida corporation, or to any other
    person or entity who succeeds it in such capacity.”



 



    (e) Section 2.1.23 of the Partnership Agreement is
    hereby amended and restated to read in its entirety as follows:



 



    “2.1.23 “Managing General Partner” shall
    refer to NPI Equity Investments, Inc., or to any other person or
    entity who succeeds in such capacity.”



 



    (f) Section 2.1.34 of the Partnership Agreement is
    hereby amended to delete such section in its entirety.



 



    (g) Section 15.3.18 of the Partnership Agreement is
    hereby amended by deleting the following word: “Except as
    provided in Paragraphs 17.6 and 17.7,”.



 



    (g) Section 16.2.2 of the Partnership Agreement is
    hereby amended to delete such section in its entirety.



 



    (h) Section 16.5 of the Partnership Agreement is
    hereby amended by deleting from the second to last sentence, the
    word “California” and replacing it with
    “Delaware”.



 



    (i) Section 16.5 of the Partnership Agreement is
    hereby amended by deleting the last sentence thereof.



 



    (j) Section 17.6 of the Partnership Agreement is
    hereby amended to delete such section in its entirety.



 



    (k) Section 17.7 of the Partnership Agreement is
    hereby amended to delete such section in its entirety.



 



    (l) Section 17.8 of the Partnership Agreement is
    hereby amended to delete from the last sentence the following
    words: “except as permitted in Paragraph 17.6 of this
    Partnership Agreement, and any act in violation of this
    provision shall not be binding upon or recognized by the
    Partnership regardless of whether any or all of the General
    Partners shall have knowledge thereof”.





    

    7








 







    (m) Section 19.1.1 of the Partnership Agreement is
    hereby amended to delete from the first sentence the following
    words: “or the Successor General Partner”.



 



    (n) Section 20.1.1 of the Partnership Agreement is
    hereby amended by deleting everything after the word
    “foregoing.”



 



    (o) Section 22.7 of the Partnership Agreement is
    hereby amended and restated to read in its entirety as follows:



 



    “The name and address of the Managing General Partners is:



 



    NPI Equity Investments, Inc.

    4582 S. Ulster St., Suite 1100

    Denver, CO 80237”



 



    (p) Section 22.9 of the Partnership Agreement is
    hereby amended and restated to read in its entirety as follows:



 



    “22.9 Notwithstanding the place where this Agreement
    may be executed by any of the parties hereto, the parties
    expressly agree that all the terms and provisions of hereof
    shall be construed under the laws of the State of Delaware and
    that the Delaware Revised Uniform Limited Partnership Act as now
    adopted or as may be hereafter amended shall govern the
    partnership aspects of this Agreement.”



 



    2. Miscellaneous.



 



    (a) Effect of Amendment.  In
    the event of any inconsistency between the terms of the
    Partnership Agreement and the terms of this Amendment, the terms
    of this Amendment shall prevail. In the event of any conflict of
    apparent conflict between any of the provisions of the
    Partnership Agreement as amended by this Amendment, such
    conflicting provisions shall be reconciled and construed to give
    effect to the terms and intent of this Amendment.



 



    (b) Ratification.  Except as
    otherwise expressly modified hereby, the Partnership Agreement
    shall remain in full force and effect, and all of the terms and
    provisions of the Partnership Agreement, as herein modified, are
    hereby ratified and reaffirmed.



 



    (c) Governing Law.  THIS
    AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
    ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE.



 




    [Remainder
    of page intentionally left blank.]





    

    8








 







    IN WITNESS WHEREOF, the parties have executed this Amendment as
    of the date first set forth above.



 



    The Managing General Partner:

    



 



    NPI EQUITY INVESTMENTS, INC.

    a Florida corporation



 


			
	 	    By: 
	
        









    Name:     




    Title:



 



    The Limited Partners:

    



 


			
	 	    By: 
	
    NPI Equity Investments, Inc.

    attorney-in-fact

	 
	 	    By: 
	
        









    Name:     




    Title:





    

    9








 








    EXHIBIT B



 




    Appraisal
    Rights of Limited Partners



 



    Capitalized terms used but not defined herein shall have the
    respective meanings ascribed thereto in the Agreement and Plan
    of Conversion and Merger, dated as of July 28, 2011, (the
    “Merger Agreement”) by and among National
    Property Investors 4, a California limited partnership, AIMCO
    NPI 4 Merger Sub LLC, a Delaware limited liability company, and
    AIMCO Properties, L.P., a Delaware limited partnership. In
    connection with the Merger, limited partners of New NPI shall
    have the following appraisal rights:



 



    (a) Any limited partner who holds New NPI Units on the
    effective date of the Merger who has not consented to the Merger
    (the “Nonconsenting Limited Partners”) and who
    has otherwise complied with paragraph (b) hereof shall be
    entitled to an appraisal by arbitration of the fair value of the
    Nonconsenting Limited Partner’s New NPI Units. This
    arbitration shall be conducted in Denver, Colorado, in
    accordance with the Commercial Arbitration Rules of the American
    Arbitration Association (“AAA”), excluding the
    Procedures for Large, Complex Commercial Disputes, by a single
    arbitrator selected by Aimco OP from a panel of AAA arbitrators
    who are qualified to value investment interests in commercial
    real estate. Any action for judicial review or enforcement of
    the arbitration award shall be brought in a court of competent
    jurisdiction located in Denver, Colorado.



 



    (b) Within 10 days after the effective date of the
    Merger, Aimco OP shall notify each of the Nonconsenting Limited
    Partners of the consummation of the Merger, the effective date
    of the Merger and that appraisal rights are available for any or
    all New NPI Units held by Nonconsenting Limited Partners, and
    shall include in such notice a copy of this Exhibit. Such notice
    shall include an Election Form pursuant to which Nonconsenting
    Limited Partners may elect an appraisal by arbitration of the
    fair value of their New NPI Units pursuant to paragraph
    (a) hereof. Any limited partner who holds New NPI Units on
    the effective date of the Merger and who has not consented to
    the Merger shall be entitled to receive such notice and may,
    within 30 days after the date of mailing of such notice
    (such 30th day being the “Election
    Deadline”), demand from Aimco OP the appraisal of his
    or her New NPI Units by making the appropriate election in the
    Election Form in accordance with the instructions thereto. Each
    completed Election Form must be delivered to the address, and
    within the time period, specified in the instructions to the
    Election Form. If a Nonconsenting Limited Partner fails to
    properly complete an Election Form or return it to the correct
    address within the specified time period, such Nonconsenting
    Limited Partner shall be deemed to have elected not to seek an
    appraisal of his or her New NPI Units, and will be deemed to
    have elected the Cash Consideration.



 



    (c) At any time prior to the Election Deadline, any
    Nonconsenting Limited Partner who has made a demand for
    appraisal of his or her New NPI Units shall have the right to
    withdraw his or her demand for appraisal and to accept the Cash
    Consideration payable pursuant to the Merger Agreement.
    Nonconsenting Limited Partners who wish to withdraw their
    demands must do so in writing delivered to Aimco Properties,
    L.P.,
    c/o Eagle
    Rock Proxy Advisors, LLC, by mail at 12 Commerce Drive,
    Cranford, New Jersey, 07016, or by fax at
    (908) 497-2349.
    At any time within 20 days after the Election Deadline, any
    Nonconsenting Limited Partner who has complied with the
    requirements of subsections (a) and (b) hereof, upon
    written request, shall be entitled to receive from Aimco OP a
    statement setting forth the aggregate number of New NPI Units
    with respect to which Nonconsenting Limited Partners have made
    demands for appraisal and the aggregate number of holders of
    such New NPI Units. Such written statement shall be mailed to
    the Nonconsenting Limited Partner within 10 days after such
    Nonconsenting Limited Partner’s written request for such a
    statement is received by Aimco OP or within 20 days after
    the Election Deadline, whichever is later.



 



    (d) Upon the submission of any such demand by a
    Nonconsenting Limited Partner, Aimco OP shall, within
    40 days after the Election Deadline, submit to the
    arbitrator a duly verified list containing the names and
    addresses of all Nonconsenting Limited Partners who have
    demanded payment for their New NPI Units and with whom
    agreements as to the value of their New NPI Units have not been
    reached with Aimco OP. The arbitrator shall give notice of the
    time and place fixed for the hearing of such demand by
    registered or certified mail to Aimco OP and to the
    Nonconsenting Limited Partners shown on the list at the
    addresses therein stated.






    

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    The forms of the notices shall be approved by the arbitrator,
    and the costs of the preparation and mailing thereof shall be
    borne by Aimco OP.



 



    (e) At the hearing on such demand, the arbitrator shall
    determine as to each of the Nonconsenting Limited Partners
    whether the Nonconsenting Limited Partner is entitled to
    appraisal rights hereunder.



 



    (f) After determining the Nonconsenting Limited Partners
    entitled to an appraisal, the arbitrator shall appraise the New
    NPI Units, determining their fair value, as of the date of the
    Merger, exclusive of any element of value arising from the
    accomplishment or expectation of the Merger, together with
    interest, if any, to be paid upon the amount determined to be
    the fair value. In determining such fair value, the arbitrator
    shall take into account all factors relevant to the issue of
    fair value of the New NPI Units, using the legal standard of
    fair value that would apply if the Nonconsenting Limited Partner
    were a stockholder in a corporation entitled to appraisal rights
    as a result of a corporate merger under the corporation laws of
    the state of Delaware. Unless the arbitrator in his or her
    discretion determines otherwise for good cause shown, interest
    from the effective date of the Merger through the date of
    payment of the judgment shall be compounded quarterly and shall
    accrue at 5% over the Federal Reserve discount rate (including
    any surcharge), as established from time to time during the
    period between the effective date of the Merger and the date of
    payment of the judgment. Upon application by Aimco OP or by any
    Nonconsenting Limited Partner entitled to participate in the
    appraisal proceeding, the arbitrator may, in his or her
    discretion, proceed with the appraisal prior to the final
    determination of the Nonconsenting Limited Partners’
    entitlement to appraisal rights hereunder. Any Nonconsenting
    Limited Partner whose name appears on the list submitted by
    Aimco OP pursuant to paragraph (d) hereof may participate
    fully in all proceedings until it is finally determined that
    such Nonconsenting Limited Partner is not entitled to appraisal
    rights hereunder.



 



    (g) The arbitrator shall direct the payment of the fair
    value of the New NPI Units (which will be paid only in cash),
    together with interest, if any, by Aimco OP to the Nonconsenting
    Limited Partners entitled thereto. Payment shall be so made to
    each such Nonconsenting Limited Partner upon the receipt by
    Aimco OP of the written consent from such Nonconsenting Limited
    Partner that, for federal income tax purposes, the issuance of
    cash for the New NPI Units shall be treated as a sale of the New
    NPI Units by the owner and a purchase of such New NPI Units by
    Aimco OP for the cash consideration so paid under the terms of
    the Merger Agreement in accordance with the guidelines set forth
    in Treas. Reg.
    Sections 1.708-1(c)(3)
    and 1.708-1(c)(4) and the release described in (i) hereof.



 



    (h) The costs of the proceeding may be determined by the
    arbitrator and taxed upon the parties as the arbitrator deems
    equitable in the circumstances. Upon application of a
    Nonconsenting Limited Partner, the arbitrator may order all or a
    portion of the expenses incurred by any Nonconsenting Limited
    Partner in connection with the appraisal proceeding, including,
    without limitation, reasonable attorney’s fees and the fees
    and expenses of experts, to be charged pro rata against the
    value of all the interests entitled to an appraisal.



 



    (i) Any Nonconsenting Limited Partner who has made a demand
    for appraisal of his or her New NPI Units and who has not
    withdrawn the demand before the Election Deadline shall be
    deemed to have entered into a binding contract with Aimco OP to
    accept the fair value awarded by the arbitrator in exchange for
    his or her New NPI Units, plus any interest as provided herein.
    The award of fair value, plus any interest, to the Nonconsenting
    Limited Partners shall be exclusive of and in lieu of any other
    right, claim or remedy under state or federal law that the
    Nonconsenting Limited Partner may have with respect to his or
    her New NPI Units whether under the Merger Agreement or
    otherwise and whether against NPI, New NPI, NPI Equity,
    Aimco-GP, Apartment Investment and Management Company, Aimco OP,
    or any other person or entity, and the Nonconsenting Limited
    Partner shall execute and deliver a release of all other such
    rights, claims and remedies in exchange for payment of the award.





    

    11








 







    (j) From and after the effective date of the Merger, no
    Nonconsenting Limited Partner who has demanded appraisal rights
    as provided in paragraph (b) hereof shall be entitled to
    vote such New NPI Units for any purpose or to receive payment of
    distributions on such interests (except distributions payable as
    of a record date prior to the effective date of the Merger);
    provided, however, that if such Nonconsenting
    Limited Partner shall deliver to Aimco Properties, L.P.,
    c/o Eagle
    Rock Proxy Advisors, LLC, by mail at 12 Commerce Drive,
    Cranford, New Jersey, 07016, or by fax at
    (908) 497-2349,
    a written withdrawal of such Nonconsenting Limited
    Partner’s demand for an appraisal and an acceptance of the
    Cash Consideration payable pursuant to the Merger Agreement,
    either as provided in paragraph (c) hereof or thereafter
    with the written approval of Aimco OP, then the right of such
    Nonconsenting Limited Partner to an appraisal shall cease. The
    appraisal proceeding may also be dismissed as to any
    Nonconsenting Limited Partner with the agreement or consent of
    Aimco OP upon such terms as the two parties may agree. Except as
    provided in the two foregoing sentences, no appraisal proceeding
    before the arbitrator shall be dismissed as to any Nonconsenting
    Limited Partner without the approval of the arbitrator, and such
    approval may be conditioned upon such terms as the arbitrator
    deems just.





    

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