Exhibit 10.39


 


PURCHASE AND SALE AGREEMENT

FOR 4550 CHERRY CREEK


 


PURCHASE AND SALE AGREEMENT FOR 4550 CHERRY CREEK (this “Agreement”)
made as of November 24, 2009 (the “Effective Date”) between 4550 CHERRY
CREEK TOWER APARTMENTS, LLC, a Colorado limited liability company having an
address of c/o Sentinel Real Estate Corporation, 1251 Avenue of the Americas,
New York, New York 10020 (“Seller”), and BEHRINGER HARVARD MULTIFAMILY OP
I LP, a Delaware limited partnership having an address of 15601 Dallas Parkway,
Suite 600, Addison, Texas 75001, or its permitted assigns (said entity and
its permitted assigns, the “Purchaser”).


 


Preliminary
Statement


 


A.                                   Seller is the owner of that certain
apartment-unit community known as 4550 Cherry Creek located in Arapahoe County,
Colorado (the “Project”).


 


B.                                     Seller wishes to sell and Purchaser
wishes to purchase the Project subject to the terms and conditions of this
Agreement.


 


NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:


 


1.                                       Purchase and Sale; Purchase Price;
Definitions.


 


1.01.                        Seller agrees to sell and Purchaser agrees to buy all
of the Seller’s rights, title and interest in and to the following property
(collectively, the “Property”) upon the terms and conditions hereinafter set
forth:


 


(a)          that certain tract of land located in
Arapahoe County, Colorado, more particularly described in Exhibit 1.01(a) attached
hereto, together with all structures, facilities, installations and other
improvements (including all parking structures) in, on, over or under said
land, and all right, title and interest of Seller, if any, whether now or
hereafter acquired, in any land lying in the bed of any street, road, avenue or
alley, open or closed, in front of or adjoining the same, to the centerline
thereof, and all easements, covenants and other rights appurtenant thereto, and
all the estate and rights of Seller in and to the same (collectively, the “Real
Property”);


 


(b)         the proceeds of, or any award made or to
be made for, a taking of all or any part of the Real Property by any
governmental authority pursuant to the exercise of its power of eminent domain;


 


(c)          all tangible personal property owned or
leased by Seller and used exclusively in connection with the operation of the
Real Property, excluding computer software,


 

















 


but including, without limitation, computer hardware, the name “4550
Cherry Creek,” “Cherry Creek Tower Apartments” and any other names (to the
extent that such exist) associated with the Property, the rights to the website
for the Property (including any photographs and floor plans thereon), any URL
or domain names for the Property, all machinery, furniture, furnishings,
decorations, decorative plants and office, landscaping, gardening, maintenance,
communications, security and other equipment, including, without limitation,
all those items listed in Exhibit 1.01(c) (the “Personal
Property”);


 


(d)         the Leases (as defined below) and all
leases entered into by Seller after the date hereof in accordance with Section 7.02
below;


 


(e)          the agreements described on Exhibit 1.01(e) and
all service contracts entered into by Seller after the date hereof in
accordance with Section 7 below (collectively, the “Service Contracts”);


 


(f)            all assignable licenses, authorizations,
approvals and permits issued by any governmental or quasi-governmental
authorities, and any assignable other intangible property relating to the
operation, ownership, use, occupancy or maintenance of the Property;


 


(g)         all assignable warranties or guaranties
presently in effect from contractors, suppliers or manufacturers of personal
property installed in or used in connection with the Property or any work
performed or improvements included as a part of the Property; and


 


(h)         to the extent located at the Property,
all surveys, blue prints, drawings, plans and specifications (including,
without limitation, structural, HVAC, mechanical and plumbing plans and
specifications) and other documentation for or with respect to the construction
or operation of the Real Property or any part thereof.


 


1.02.                        The aggregate purchase price (the “Purchase Price”)
for the Property shall be Fifty-Three Million and no/100ths Dollars
($53,000,000.00), and shall be paid as follows:


 


(a)          $500,000.00, together with all interest
accrued thereon (the “Initial Deposit”), within two (2) business days of
the execution of this Agreement by Seller and Purchaser, to be deposited in
escrow with First American Title Insurance Company of New York (“Escrow Agent”),


 


(b)         $500,000.00 (the “Second Deposit”, the
term “Second Deposit” shall include all interest accrued thereon) on or prior
to the expiration of the Due Diligence Period (as defined below), to be
deposited in escrow with the Escrow Agent,


 


(c)          if applicable, the Third Deposit (as
defined below) to be deposited in escrow with the Escrow Agent as provided in Section 3.01
below (the Initial Deposit and, if applicable, the Second Deposit and Third
Deposit are collectively referred to herein as the “Deposit” and individually
as the “Deposit”), and


 

















 


(d)         The balance of the Purchase Price,
subject to apportionment and proration as provided herein in cash by Federal
wire transfer at Closing, as directed by Seller.


 


Concurrently with the execution of this Agreement,
Purchaser is paying to Seller the sum of ONE HUNDRED AND NO/100 DOLLARS
($100.00) as independent consideration (the “Independent Consideration”) for
the execution of this Agreement by Seller. 
Such Independent Consideration is being paid to, and shall be retained
by, Seller as additional consideration for this Agreement and not as part of
the Purchase Price.  Such Independent
Consideration is deemed earned by Seller as of the Effective Date of this
Agreement and is non-refundable in all events.


 


2.                                       Investigation; Title Commitment; Survey.


 


2.01.                        Purchaser and its agents and representatives shall
have through and until 3:00pm New York time on January 6, 2010 (the “Due
Diligence Period”) in which to make an inspection of the Property and the
Property Materials (as defined below). 
If for any reason whatsoever Purchaser is not satisfied with the results
of its due diligence review, Purchaser may terminate this Agreement by sending
written notice of termination to Seller at any time prior to the expiration of
the Due Diligence Period, in which event the Purchaser shall be entitled to the
prompt return of the Deposit.  Purchaser’s
failure to send timely notice of its termination prior to the expiration of the
Due Diligence Period shall be deemed a waiver of Purchaser’s right to terminate
this Agreement pursuant to this Section 2.01.  Upon any termination of this Agreement,
Purchaser shall promptly return to Seller or destroy all unreturned information
regarding the Property of whatever nature made available to Purchaser by Seller
or Seller’s agents or representatives (the “Property Materials”), and the
parties shall have no further obligations or liability hereunder, except for
such obligations which expressly survive the termination of this
Agreement.  Seller shall provide
Purchaser the Property Materials set forth on Exhibit 2.01 within one (1) business day after the later of (i) the
execution of this Agreement by all parties hereto and (ii) the date that
the Deposit is received by the Escrow Agent.  Provided that Purchaser has deposited the
Deposit with the Escrow Agent as required hereby, during the term of this
Agreement, upon reasonable advance notice to Seller (which notice shall be
delivered at least one full business day prior to property visits and at least
three full business days prior to visits involving testing or entry into any
tenant’s apartment) (which notices may be by telephone), Purchaser, its agents
and representatives shall be entitled to enter upon the Property during regular
business hours (subject to the rights of tenants in possession) to perform such
inspections and tests of the Property as Purchaser deems reasonably necessary
to evaluate the purchase of the Property; provided, however, that in no event
shall (i) such inspections or tests unreasonably disrupt or disturb the
on-going operation of the Property or the rights of the tenants at the
Property, (ii) Purchaser or its agents or representatives drill or bore on
or through the surface of the Property or conduct any other invasive test
without Seller’s prior written consent, which consent may be given or withheld
in such Seller’s sole and absolute discretion, and (iii) Purchaser perform
any tests at or on the Property after the expiration of the Due Diligence
Period.  For the avoidance of doubt,
during Purchaser’s visits to the Property permitted hereunder, Purchaser shall
be entitled to review Seller’s lease files located at the Property.  Purchaser shall furnish to Seller
satisfactory evidence that Purchaser is insured under a policy of


 

















 


general liability insurance providing limits of not less than Two
Million and no/100ths Dollars ($2,000,000.00) (which amount may be met in
combination with an umbrella/excess liability policy) against any and all
personal injury, death, loss, damage, expense, liability or responsibility
whatsoever which may be occasioned, directly or indirectly, by reason of this
exercise of this right of entry upon or inspection of the Property by Purchaser
of any of its agents or assigns. 
Purchaser agrees to repair any damage to the Property caused by any
testing or inspection and to indemnify and hold Seller harmless from and
against any expense, claim or liability for personal injury or property damage
caused by entry upon the Property by Purchaser’s agents, representatives or
employees in connection with Purchaser’s inspection pursuant to this Section 2.01
or any other entry by Purchaser on the Property, provided, however, such indemnity shall not cover the mere discovery of
existing conditions.  Purchaser shall
promptly upon receiving notice of any lien placed on the Property by reason of
Purchaser’s or its agent’s or representative’s tests or inspections, cause the
lien to be discharged or bonded at Purchaser’s sole expense, and such lien
shall be deemed a Permitted Exception. 
Purchaser anticipates causing its independent contractors, agents,
consultants and other representatives conducting the inspection pursuant to
this Section 2.01 or any other entry by Purchaser on the Property
(collectively, “Purchaser’s Feasibility Representatives”) to procure and
maintain during the term of this Agreement liability insurance of not less than
$2,000,000 and to cause Purchaser’s Feasibility Representatives to indemnify
and hold Purchaser harmless from claims, liabilities, damages, losses, costs,
and expenses (including reasonable attorneys’ fees) for and from which
Purchaser is obligated to indemnify and hold Seller harmless in this Section 2.01.  If (i) Purchaser is obligated to
indemnify and hold Seller harmless in this Section 2.01 and (ii) Seller
actually receives money on account of any indemnification and hold harmless
from Purchaser’s Feasibility Representatives (by way of an assignment from
Purchaser to Seller or otherwise), Purchaser shall not be obligated to indemnify
and hold Seller harmless in this Section 2.01 to the extent of such
money actually received by Seller. 
Anything contained herein to the contrary notwithstanding, the foregoing
indemnity shall survive the Closing or the termination of this Agreement for
any reason.


 


Seller shall terminate each Service Contract which is
terminable at no cost to Seller on no more than thirty (30) days notice
effective as of the Closing Date if Purchaser notifies Seller to terminate the
same prior to the expiration of the Due Diligence Period.


 


2.02.                        As soon as practical after the execution and delivery
of this Agreement, Seller shall, if it has not already done so, order a
commitment (the “Title Commitment”) for a 2006 ALTA extended owner’s title
insurance policy, issued by First American Title Insurance Company (the “Title
Insurance Company”), together with copies of all recorded documents (“Exception
Documents”) referred to in the Title Commitment and the Searches (as hereafter
defined).


 


(b)         As soon as practical after the execution
and delivery of this Agreement, Seller shall, if it has not already done so,
order (i) an ALTA survey of the Real Property (the “Survey”) by a surveyor
licensed in the State of Colorado certified to Seller, Purchaser and the Title
Insurance Company setting forth and depicting, such matters necessary to obtain
extended title insurance coverage for the Real Property over all general survey
exceptions


 

















 


and (ii) Current UCC, tax lien and judgment searches with respect
to Seller and its manager, Cherry Creek Manager, Inc., for the Real
Property and the Personal Property showing all liens, security interests and
adverse claims affecting the Seller’s interest in the Real Property and/or the
Personal Property (collectively, “Searches”). The Survey shall meet the Minimum
Standard Detail Requirements for ALTA/ACSM Land Title Surveys adopted by the
ALTA and the ACSM in 2005 and shall include Table A Items 1-4, 6, 7(a), 7(c),
8, 9, 10, 11(a), and 14.


 


(c)          On or before the date which is five (5) business
days after receipt by Purchaser of all of the Title Commitment, Exception
Documents, Survey and Searches (or any update, amendment, or change to any of
the same), Purchaser may provide Seller with written notice (each, a “Purchaser’s
Exception Notice”) setting forth a list of the matters set forth or disclosed
in the same that are not acceptable to Purchaser (each, an “Unpermitted
Exception” and, collectively, Unpermitted Exceptions”; and all matters not so
objected to are herein referred to as “Permitted Exceptions”).  Notwithstanding the foregoing, Purchaser
shall not object to (i) any exception for the rights of tenants under the
Leases or any leases entered into in accordance with Section 7.02 below or
any other matter permitted thereunder, and the same shall be deemed “Permitted
Exceptions”; (ii) in respect of the Survey, any matter unless said matter
constitutes a material defect, encroachment or other material adverse title
and/or survey matter that is not set forth on Exhibit 2.01(c), and
said matters to which Purchaser is not permitted to object shall be deemed “Permitted
Exceptions”; and (iii) any of the matters set forth on Exhibit 2.01(c),
all of which are deemed “Permitted Exceptions”.


 


2.03.                        Seller shall have the right, but not the obligation, within
five (5) business days after receipt of a Purchaser’s Exception Notice (a “Seller’s
Election Period”), to send Purchaser written notice (a “Seller’s Election
Notice”) that Seller has agreed to use reasonable efforts to remove or
otherwise remedy any or all of the Unpermitted Exceptions set forth in such
Purchaser’s Exception Notice on or before the Closing Date.  If Seller provides Purchaser with such
written notice within such Seller’s Election Period, Seller shall use
reasonable efforts (but shall not be required to undertake any litigation) to
remove or otherwise remedy the Unpermitted Exceptions set forth on such Seller’s
Election Notice in a manner reasonably acceptable to Purchaser on or before the
Closing Date, and in the event that Seller despite such reasonable efforts
fails to remove or remedy such Unpermitted Exceptions in a manner reasonably
acceptable to Purchaser on or before the Closing Date, Purchaser, as its sole
remedy, shall be entitled to terminate this Agreement.  Upon such termination, Escrow Agent shall
promptly deliver the Deposit to Purchaser and Purchaser promptly shall destroy
or return or cause to be returned to Seller all unreturned Property Materials
received by Purchaser and its agents and representatives from Seller and the
parties shall have no further rights or obligations hereunder except as
otherwise expressly provided herein.


 


2.04.                        If Seller does not agree within a Seller’s Election
Period to remove all Unpermitted Exceptions referenced in the applicable
Purchaser’s Exception Notice on or before the Closing Date as hereinbefore
provided, Purchaser shall have five (5) business days after the earlier of
(i) receipt of the applicable Seller’s Election Notice or (ii) the
expiration of the applicable Seller’s Election Period to give Seller notice
that Purchaser has elected to terminate this Agreement or that it has waived
the applicable Title Objections that Seller has not agreed to


 

















 


remove.  Upon any such
termination, the Escrow Agent shall promptly deliver the Deposit to Purchaser
and Purchaser shall destroy or return or cause to be returned to Seller all
unreturned Property Materials received by Purchaser and its agents and
representatives from Seller and the parties shall have no further rights or
obligations hereunder, except as otherwise expressly provided herein.  If Purchaser sends the foregoing notice of
waiver (or if Purchaser fails to give such notice) within the aforesaid five (5) business
day period, then the condition set forth in this Article 2 shall be
deemed satisfied or waived and the parties shall, subject to the satisfaction
of all other terms and conditions applicable to the respective parties’
obligations hereunder, be obligated to proceed to Closing.  In such event the term “Permitted Exceptions”
as used herein in connection with the status of title to be conveyed to
Purchaser shall mean and include all exceptions designated by Purchaser as
Permitted Exceptions pursuant to Section 2.02(c) hereof, as
well as any Unpermitted Exceptions as to which Purchaser has so waived (or been
deemed to have waived) its objections. 
Notwithstanding the foregoing, Seller shall cause liens of an
ascertainable amount voluntarily created by Seller to be released at the
Closing or otherwise omitted from the Title Policy in a manner reasonably
acceptable to Purchaser, and Seller further agrees to remove or otherwise cause
to be omitted from the Title Policy in a manner reasonably acceptable to
Purchaser any exceptions or encumbrances to title which are voluntarily created
by Seller after the date of this Agreement without Purchaser’s consent.


 


3.                                       Closing.


 


3.01.                        The closing of the transactions contemplated by this
Agreement (the “Closing”) shall be at 1:00 p.m. (New York time) on January 21,
2010 (the “Closing Date”) or such earlier date as may be designated by
Purchaser in a notice from Purchaser to Seller delivered not less than ten (10) business
days before such earlier Closing Date, as the same may be adjourned in
accordance with the terms hereof, time being of the essence.  Notwithstanding the foregoing, Purchaser
shall have a one time right to extend the Closing Date to a date certain that
is not more than thirty (30) days after the initial Closing Date by delivering
notice thereof to Seller (the “Extension Notice”), prior to the expiration of
the Due Diligence Period.  Within three
business days after its delivery of the Extension Notice (and as a condition
precedent to the effectiveness of the Extension Notice), Purchaser shall deliver
$1,000,000 (the “Third Deposit”, the term “Third Deposit” shall include all
interest accrued thereon) to the Escrow Agent, which amount shall be paid by
Purchaser and held by Escrow Agent in the same manner as the Initial
Deposit.  The Closing shall be held at
the offices of the Escrow Agent or at such other location as the parties may
agree, or by escrow arrangement acceptable to the parties.


 


3.02.                        It is a condition to Purchaser’s obligations to
proceed to Closing that, as of the Closing Date (a) all of Seller’s
representations and warranties hereunder are true and correct in all material
respects as if made on and as of the Closing Date, (b) Seller has
performed all of its covenants and satisfied all of its obligations hereunder, (c) the
Title Insurance Company has irrevocably committed to issue a 2006 ALTA Extended
Coverage Owner’s Policy of Title Insurance (subject to payment of the portion
of the premium, if any, that Purchaser is required to pay hereunder) with
liability in an amount equal to the Purchase Price showing the Real Property vested
in Purchaser (or Purchaser’s permitted assignee or nominee) free and clear of
any occupants or rights to possession other than pursuant to the Leases (as
defined in


 

















 


Section 4.01(e)), the Permitted Exceptions, any leases entered into
pursuant to Section 7.02 below and title exceptions, if any,
resulting from documents recorded by Purchaser at Closing, (the “Title Policy”)
(d) Seller has delivered all documents and made all other deliveries
required in this Agreement and (e) all other conditions to Purchaser’s
obligations to proceed to Closing which are set forth in this Agreement are
satisfied.  If any condition to Purchaser’s
obligations hereunder is not fulfilled in any material respect, including any
condition not set forth in this Section 3.02, Purchaser shall have
no obligation to proceed to Closing, but may do so at its option.  If a condition precedent is not fulfilled in
any material respect and Purchaser is not prepared to proceed to Closing,
Purchaser shall notify Seller in writing that it elects to terminate this
Agreement, without limiting its rights in respect of any default by Seller
provided hereunder.  Upon such
termination, the Escrow Agent shall promptly return the Deposit to Purchaser
and Purchaser shall destroy or return or cause to be returned to Seller all
unreturned Property Materials received by Purchaser and its agents and
representatives from Seller and the parties shall have no further rights or
obligations hereunder except as otherwise expressly provided herein.  Purchaser acknowledges that if any of the
representations and warranties made by Seller hereunder as of the date hereof
are not true and complete in all material respects as if made on and as of the
Closing Date, and the cause of which is not the result of Seller’s act or
wrongful omission or default hereunder or breach of such representation and
warranty when made, Purchaser’s sole remedy shall be either to waive the
condition described in clause (a) above with respect to such
representation and warranty (in which event such representation and warranty
shall be deemed amended to reflect the actual state of facts of which Seller
has actual knowledge) or terminate this Agreement and receive a return of the
Deposit as provided above for failure of a condition.  Upon such termination, the Escrow Agent shall
promptly return the Deposit to Purchaser and Purchaser shall destroy or return
or cause to be returned to Seller all unreturned Property Materials received by
Purchaser and its agents and representatives from Seller and the parties shall
have no further rights or obligations hereunder except as otherwise expressly
provided herein.


 


3.03.                        It is a condition to Seller’s obligations to proceed
to Closing that, as of the Closing Date (a) all of Purchaser’s
representations and warranties hereunder are true and correct in all material
respects as if made on and as of the Closing Date, (b) Purchaser has
performed all of its covenants hereunder, (c) the Purchaser has delivered
all documents and made all other deliveries required in this Agreement, and (d) all
other conditions to Seller’s obligations to proceed to Closing which are set
forth in this Agreement are satisfied. 
If any condition to Seller’s obligations hereunder is not fulfilled in
any material respect, including any condition not set forth in this Section 3.03,
Seller shall have no obligation to proceed to Closing, but may do so at its
option.  If a condition precedent is not
fulfilled in any material respect and Seller is not prepared to proceed to
Closing, Seller may terminate this Agreement by sending written notice to
Purchaser without limiting its rights in respect of any default by Purchaser
hereunder.  Upon such termination, the
Escrow Agent shall promptly return the Deposit to Purchaser and Purchaser shall
destroy or return or cause to be returned to Seller all unreturned Property
Materials received by Purchaser and its agents and representatives from Seller
and the parties shall have no further rights or obligations hereunder except as
otherwise expressly provided herein.


 

















 


4.                                       Representations and Warranties of Seller.


 


4.01.                        Seller represents and warrants to Purchaser and its
successors and assigns that:


 


(a)          Seller is a limited liability company
duly organized and validly existing under the laws of the State of Colorado,
and is authorized to own its property and conduct its business in each
jurisdiction where it is required to be so authorized.


 


(b)         Seller has the legal right, power and
authority to enter into this Agreement and the documents contemplated hereby
and perform all of its obligations hereunder and thereunder, and the execution
and delivery of this Agreement and the documents contemplated hereby by Seller
and the performance by Seller of its obligations hereunder and thereunder (i) have
been duly authorized by all requisite action and (ii) shall not conflict
with, or result in a breach or violation of or default under, or be modified,
restricted or precluded by (w) any of the terms, conditions and provisions
of the governing documents of Seller, (x) any order, judgment, writ,
injunction or decree of any court or governmental instrumentality which has
been served or otherwise given to Seller, (y) any agreement or instrument
to which Seller is a party or by which Seller is bound, or to which Seller or
any portion of Seller’s property is subject, or (z) any law, rule or
regulation.


 


(c)          Seller has not (i) made a general
assignment for the benefit of its creditors, (ii) instituted any
proceeding to be adjudicated bankrupt or insolvent or consented to the institution
of bankruptcy or insolvency proceedings against it, (iii) filed a
petition, answer or consent seeking reorganization or relief under any
applicable Federal or state bankruptcy law or consented to the filing of any
such petition or to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator or other similar official of it or of any part of its
property, (iv) admitted in writing its inability to pay its debts
generally as they become due, or (v) taken any action in furtherance of any
of the foregoing.


 


(d)         Except as set forth in Exhibit 4.01(d),
to Seller’s knowledge, Seller has not received written notice from any
governmental agency requiring the correction of any condition with respect to
the Property, or any part thereof, by reason of a violation of any code,
ordinance, law or regulation of any city, county, state, or federal government
which has not been cured.


 


(e)          Attached hereto as Exhibit 4.01(e) is
a rent roll (the “Rent Roll”) in respect of all leases that to Seller’s Knowledge
have been signed and delivered and are in effect as of the date noted thereon
in respect of the Real Property (the “Leases”). 
To Seller’s knowledge, the Rent Roll is true and correct in all material
respects.  To Seller’s knowledge and as
of the date of the Rent Roll only, (i) Exhibit 4.01(e) discloses
all refundable security deposits made by each of the tenants under the Leases, (ii) no
tenant is or was entitled to any rebate or concession which is not disclosed on
Exhibit 4.01(e), and (iii) there are no written or oral leases
affecting the Property other than those listed in Exhibit 4.01(e).


 

















 


(f)            Except as set forth in Exhibit 4.01(f),
to Seller’s knowledge, none of Seller’s interests in the Leases or any of the
rents or amounts payable thereunder has been assigned, pledged, hypothecated or
otherwise encumbered.


 


(g)         To Seller’s knowledge, except for the
Service Contracts, there are no service or maintenance contracts or equipment
leases entered into by Seller affecting the Property which are not terminable
without cause on no more than 30 days notice. 
To Seller’s knowledge, the copies of the Service Contracts furnished by
Seller to Purchaser are true, correct and complete and there exist no defaults
by Seller under any of such Service Contracts.  Except as set forth in Exhibit 4.01(h),
to Seller’s knowledge, Seller has received no written notice of, nor are there
any pending or threatened actions or proceedings (including, without
limitation, condemnation or eminent domain proceedings or proceedings in the
nature or in lieu thereof) against Seller or the Property, relating to or
adversely affecting the right, title or interest of Seller in or to the
Property or any part thereof or the ability of Seller to fulfill its
obligations hereunder that have not been cured.


 


(h)         To Seller’s knowledge there are no liens
or encumbrances against the Personal Property listed on Exhibit 1.01(c) other
than those in connection with the existing first mortgage, if any, affecting
the Property.


 


(i)             Seller is not a “foreign person” as that
term is defined in the I.R.C., Section 1445(F)(3).


 


(j)             Seller has no employees.


 


(k)          To Seller’s knowledge, the financial
statements annexed as Exhibit 4.01(k) are true and correct in
all material respects with respect to the periods set forth thereon.


 


(l)             To Seller’s knowledge, Seller has not
received written notice of any violation of Environmental Laws related to the
Property or the presence or release of Hazardous Materials on or from the
Property except as may be set forth in the environmental report(s) described
on Exhibit 4.01(l).  The term
“Environmental Laws” includes without limitation the Resource Conservation and
Recovery Act and the Comprehensive Environmental Response Compensation and
Liability Act and other federal laws governing the environment as in effect on
the date of this Agreement together with their implementing regulations and
guidelines as of the date of this Agreement, and all state, regional, county,
municipal and other local laws, regulations and ordinances that are equivalent
or similar to the federal laws recited above or that purport to regulate
Hazardous Materials.  The term “Hazardous
Materials” includes petroleum, including crude oil or any faction thereof,
natural gas, natural gas liquids, liquefied natural gas, or synthetic gas
usable for fuel (or mixtures of natural gas or such synthetic gas), asbestos
and asbestos containing materials and any substance, material waste, pollutant
or contaminant listed or defined as hazardous or toxic under any Environmental
Law.


 


4.02.                        Any reference in this Article 4 to the
knowledge of Seller shall refer only to the current actual knowledge of the
Designated Representative (as defined below) of Seller,


 

















 


and shall not be construed, by imputation or otherwise, to refer to the
knowledge of Seller or any affiliate thereof or to impose upon such designated
employees any duty to investigate the matter to which such actual knowledge, or
the absence thereof, pertains.  As used
herein, the term “Designated Representative” shall refer to the following
people: Mr. Robert Kass, who is a Managing Director of Sentinel Real
Estate Corporation, and Stephanie Chamblin, who is an asset manager in respect
of the Property.


 


4.03.                        The representations and warranties of Seller contained
in Section 4.01 shall survive the Closing until the date nine (9) months
from the date thereof unless a written claim in respect thereof is still
pending on such date (in which case the relevant representations and warranties
shall survive as to the pending claim until its final resolution) (the “Survival
Period”).


 


4.04.                        Notwithstanding anything to the contrary contained in
this Agreement, the liability of Seller in respect of the representations and
warranties contained in Section 4.01 above shall be limited to
Seven Hundred Fifty Thousand and No/100ths Dollars ($750,000.00) in the
aggregate, and the recovery of such amount from Seller shall be Purchaser’s
sole and exclusive remedy in respect thereof. 
Seller hereby covenants to Purchaser that (i) Seller shall maintain
in a bank account of Seller the sum of not less than $750,000, for the nine
month period following the Closing Date and (ii) Seller shall not
terminate its existence with the Colorado Secretary of State until the end of
the Survival Period.  This Section 4.04
shall survive Closing.


 


5.                                       Representations and Warranties of
Purchaser.


 


5.01.                        Purchaser hereby represents and warrants to Seller and
its successors and assigns as of the date hereof that:


 


(a)          Purchaser is a limited partnership duly
organized and validly existing under the laws of the State of Delaware, and is
authorized to own its property and conduct its business in each jurisdiction
where it is required to be so authorized.


 


(b)         Purchaser has the legal right, power and
authority to enter into this Agreement and will prior to Closing have all legal
right, power and authority to perform all its obligations hereunder, and the
execution and delivery of this Agreement by Purchaser and the performance by
Purchaser of its obligations hereunder (i) have been duly authorized, or
will be duly authorized by Closing, by all requisite action, and (ii) shall
not conflict with, or result in a breach or violation of, or be modified,
restricted or precluded by (w) any of the terms, conditions and provisions
of the organizational documents of Purchaser, (x) any order, judgment,
writ, injunction or decree of any court or governmental instrumentality which
has been served or otherwise received by Purchaser, (y) any agreement or
instrument to which Purchaser is a party or by which it is bound, or to which
it or any portion of its property is subject, or (z) any law, rule or
regulation.


 


5.02.                        The representations and warranties of Purchaser
contained in Section 5.01 shall survive the Closing until
expiration of the Survival Period.


 
















 


6.                                       Brokerage.


 


6.01.                        Neither party has had any contact or
dealings regarding the Property, or any communication in connection with the
subject matter of this transaction, through any real estate broker or other
person who can claim a right to a commission or finder’s fee in connection with
the sale contemplated herein, other than with Apartment Realty Advisors (“Broker”),
whose commission, if any, Purchaser shall pay in accordance with a separate
agreement between Purchaser and Broker. 
In the event any broker or finder other than Broker claims a commission
or finder’s fee based upon any contact, dealings or communication, the party
through whom such broker or finder makes its claim shall be responsible for
said commission or fee and all costs and expenses (including reasonable
attorneys’ fees) incurred by the other party in defending against the
same.  The party through whom any broker
or finder other than Broker makes a claim shall hold harmless, indemnify and
defend the other party hereto, its successors and assigns, agents, employees,
directors, officers, trustees, shareholders, members from and against any and
all obligations, liabilities, claims, demands, liens, encumbrances and losses
(including attorneys’ fees), whether direct, contingent or consequential,
arising out of, based on, or incurred as a result of such claim.


 


6.02.                        The provisions of this Article 6
shall survive the Closing.


 


7.                                       Operations.


 


7.01.                        Between the date hereof and the Closing, Seller shall
operate and maintain the Property in its customary manner in all material
respects (including maintaining the URL or domain names currently in use for
the Property and not removing any of the items of Personal Property listed on Exhibit 1.01(c) unless
replaced with items of substantially the same or better quality), subject to
normal wear and tear, casualty and condemnation.  Until the Closing Date Seller shall maintain
insurance on the Property as currently insured, except for such changes as
shall be consented to by Purchaser, which approval shall not be unreasonably
withheld.


 


7.02.                        Between the date hereof and the Closing, Seller may
enter into new leases for space in the Project in accordance with its current
business practices.  After the expiration
of the Due Diligence Period, Seller shall not enter into any new Lease or Lease
renewals that provide for a monthly rental less than the rental presently being
charged or be for a term less than six (6) months or in excess of twelve
(12) months without receiving Purchaser’s prior written consent, which shall
not be unreasonably withheld, provided that, notwithstanding the foregoing
restrictions, Seller may renew month to month leases for the then current
tenants at the Property.


 


7.03.                        Between the date hereof and the Closing, Seller
without the written consent of Purchaser, shall not enter into any contract
that will be an obligation affecting the Property subsequent to the Closing,
except contracts that are terminable without cause on 30-days’ notice and
without the payment of any termination or similar fee.


 


7.04.                        Seller shall bring all units which are vacant on the
date which is seven (7) days prior to Closing, up to rent ready condition,
consistent with Seller’s past practices, including


 

















 


working appliances (either new or minimal cosmetic damage), paint and
cleaned or new (as reasonably necessary) carpets and for any such unit that
Seller fails to make “rent-ready” as aforesaid one (1) business day prior
to Closing, Seller shall give Purchaser a credit to be applied against the
Purchase Price at Closing in the amount of $500.00.


 


7.05.                        Seller shall not apply any security deposits against
rent delinquencies or other Lease defaults unless the subject Lease(s) have
been terminated and the tenant(s) thereunder have vacated the Premises.


 


7.06.                        Seller shall not initiate, consent to, approve or
otherwise make any change to zoning or any other governmental rules or
regulations presently applicable to all or any part of the Property.


 


7.07.                        As of Closing, all management contracts shall have
been terminated.


 


7.08.                        Prior to or at the Closing, Seller shall use
reasonable efforts to assist Purchaser in assigning any assignable warranties
or Service Contracts to Purchaser as Purchaser may request.


 


7.09.                        For a period of at least 72 hours before the Closing,
Seller shall use reasonable efforts to discontinue data entry operations in the
on-site computer system for the Property, including making deposits of rental
income.  Seller acknowledges that such
discontinuance is intended to afford Seller and Purchaser an opportunity to
coordinate the transition of the Property in anticipation of Closing and to
complete work on prorations as set forth in this Agreement.  Seller shall, as soon as reasonably
practicable after discontinuing such data entry, use reasonable efforts to
forward to Purchaser or its designee data to facilitate the compilation of
prorations.  For the avoidance of doubt,
it shall not be a default of Seller hereunder in the event that Seller does not
strictly comply with the provisions of this Section 7.09.


 


8.                                       Closing Adjustments; Transfer of Security
Deposits.


 


8.01.                        A statement of prorations and other adjustments (the “Closing
Statement”) shall be prepared by Seller in conformity with the provisions of
this Agreement and submitted to Purchaser for review, comment and approval (not
to be unreasonably withheld) not less than two (2) business days prior to
the Closing Date.  The following items in
respect of the Property shall be apportioned at Closing in an equitable manner
as of the close of business on the day prior to the Closing Date (the “Adjustment
Date”) so that the income and expense items with respect to the period up to
and including the Adjustment Date will be for Seller’s account and the income
and expense items with respect to the period after the Adjustment Date will be
for Purchaser’s account:


 


(a)          Rents as and when collected.  Fixed rents and other periodic charges,
including without limitation any pet rents, garage rents or other recurring
rents and fees (collectively, “Rent”) owed by tenants that have not been
collected by Seller which are applicable to any period of time prior to the
Adjustment Date, if and when collected, shall be paid by


 

















 


Purchaser to Seller, subject to the following sentence. Rents collected
after the Adjustment Date from a tenant who had been in arrears on the
Adjustment Date shall be deemed first to be payment of amounts, if any, due
from such tenant in respect of the period in which the Adjustment Date falls,
then in respect of periods subsequent to the Adjustment Date, and any balance
shall be deemed to be payment of amounts in arrears on the Adjustment Date.
Purchaser shall use reasonable efforts to collect rent arrearages due Seller
from tenants, provided that Purchaser shall not be obligated to commence any litigation
against such tenants, incur any expense in collecting such arrearages or
terminate any tenant’s lease.  If after
ninety (90)days following the Closing Date, Purchaser has failed to collect any
such rent arrearages, Seller may institute proceedings against such tenant to
collect such rent arrearages, provided that in no event shall Seller be
entitled to terminate such tenant’s lease or dispossess such tenant.  Purchaser and Seller agree to promptly
deliver to the other the portion of any rents collected by such party to which
the other is entitled pursuant to this Section.


 


(b)         All real and personal property taxes and
other taxes and assessments imposed on the owner of the Property, as owner, and
not paid by others.  If the Closing shall
occur before the taxes and assessments are fixed for the current tax year, the
apportionment of such taxes and assessments shall be tentatively made on the
basis of the best available information on the current assessment and tax rate
and shall be finally adjusted (and any necessary payments shall be made) at
such time as the tax bill shall be issued. 
If after the Closing there shall be a retroactive increase in the
assessment of the Property and a corresponding increase in the real or personal
property taxes and assessments imposed on the owner of the Property: (i) if
such increase (other than an increase arising solely from the sale of the
Property to Purchaser) shall relate to the tax year in which the Closing
occurred such increase shall be prorated by Seller and Purchaser on a per diem
basis based on their respective periods of ownership during the period such
increase is effective, (ii) if such increase shall relate to any tax year
subsequent to the tax year which the Closing occurred, such increase shall be
the obligation of Purchaser, and (iii) if such increase shall relate to
any tax year prior to the tax year in which the Closing occurred, such increase
shall be the obligation of Seller.


 


(c)          Utility charges, payable by the owner of
the Property, including water and sewer charges, except that where practicable,
utility readings shall be taken on the day prior to the Closing, and Seller
shall bear the charges for utility services based on such reading and Purchaser
shall bear charges for all such utility services thereafter.


 


(d)         Income from and charges under the Service
Contracts not terminated at Closing and any transferable permits and licenses
necessary for the operation of the Property.


 


(e)          All prepaid rents.


 


(f)            Other income and expenses of operation
and similar items to the extent each of the same is customarily prorated
between buyers and sellers of real property in Denver, Colorado.


 

















 


8.02.                        Any item of income or expense which should be
apportioned and which is not or cannot be apportioned as of the Adjustment Date
shall be reasonably estimated by Seller at Closing (for purposes of the Closing
Statement) and then duly apportioned and prorated as soon as determined.  Purchaser shall receive a credit at Closing
in an amount equal to all then unpaid leasing commissions due in respect of the
leases at the Property.


 


8.03.                        Seller shall pay for the cost of the Title Policy
(other than for extended coverage and endorsements), all real property transfer
taxes due upon recordation of the deed, Seller’s attorney’s fees, one-half of
the cost of Survey and one-half of any fees charged by Escrow Agent for its
services hereunder.  Purchaser shall be
responsible for the payment of the state documentary fee, recording fees for
the deed, Purchaser’s attorneys fee, the cost of extended coverage and all
endorsements issued in connection with the Title Policy (except those insuring
over Unpermitted Exceptions, but only to the extent Seller has agreed in
writing after the date hereof to pay for the same) and one-half of any fees charged
by Escrow Agent for its services hereunder and for one-half of the cost of
Survey.  Any other closing cost not
designated hereunder shall be payable per local custom.


 


8.04.                        In the event of any reduction in the assessed
valuation of the Real Property for any fiscal year, the net amount of any tax
savings, after deduction of reasonable expenses and tax service fees shall (a) with
respect to fiscal years (for real estate taxes) ending prior to the fiscal year
in which the Closing Date shall occur, be payable to Seller, (b) with
respect to the fiscal year (for real estate taxes) in which the Closing Date
shall occur, be adjusted between Seller and Purchaser as of the Closing Date so
that the amount of such savings with respect to the period up to (and including)
the Closing Date shall be payable to Seller and the remaining amount shall be
payable to Purchaser and (c) with respect to all fiscal years after the
fiscal year in which the Closing Date shall occur, be payable to Purchaser.
Notwithstanding the foregoing Purchaser shall not adjust or settle any such
protest or proceeding with respect to such fiscal years ending prior to the
fiscal year in which the Closing Date shall occur without Seller’s prior
written consent, which consent shall not be unreasonably withheld or delayed.
Any such protest or proceeding which relates in whole or in part to any period
after the Closing Date shall be prosecuted by Purchaser. Any such protest or
proceeding which relates in whole or in part to periods prior to the Closing
Date may be prosecuted by Seller provided any settlement of the same shall be
subject to the consent of Purchaser, which consent shall not be unreasonably
withheld.


 


8.05.                        Any post-closing adjustments due either party shall be
promptly made. Seller shall pay over to Purchaser any amounts received by it
following the Closing in respect of the Property to which Purchaser is entitled
not more than ten (10) days from the date received.


 


8.06.                        All refundable deposits held by Seller pursuant to the
terms of the Leases shall, together with accrued interest thereon (but only (i) if
such interest is required by law and/or the Leases to be paid to tenant under
any such Leases or (ii) if the Leases require such interest to become a
part of such security deposit), if any, be transferred to Purchaser as a credit
against the Purchase Price at Closing, and thereafter Purchaser shall indemnify
Seller from and against any and all claims, by tenants, their successors and
assigns for such refundable deposits and interest


 

















 


thereon credited to Purchaser at Closing.  All accrued interest under said security
deposits, if any, which is not required to be transferred to Purchaser by the
immediately preceding sentence shall be for Seller’s account.


 


8.07.                        The provisions of this Article 8 shall survive
the Closing until the date which is twelve (12) months from the date thereof,
except for Sections 8.06, which shall survive indefinitely.


 


9.                                       Closing Documents.


 


9.01.                        Seller shall deliver, or cause to be delivered, to
Purchaser on the Closing Date:


 


(a)          a deed, in the form of Exhibit 9.01(a),
duly executed by Seller and acknowledged in form suitable for recording,
conveying to Purchaser title to the Real Property (the “Deed”);


 


(b)         four originals of a bill of sale in the
form of Exhibit 9.01(b) (the “Bill of Sale”) duly executed by
Seller;


 


(c)          four originals of an assignment and
assumption of leases in the form of Exhibit 9.01(c) duly
executed by Seller, assigning to Purchaser all of Seller’s interest in the
Leases and the security deposits referred to in Section 8.06 (the “Assignment
and Assumption of Leases”);


 


(d)         four originals of an assignment and
assumption of contracts in the form of Exhibit 9.01(d) duly
executed by Seller, assigning to Purchaser all of Seller’s interest in the
Service Contracts and all assignable licenses, intangibles and warranties
relating to the Project (“Assignment and Assumption of Contracts”);


 


(e)          four originals of a letter in the form of
Exhibit 9.01(e)-1, signed by Seller, advising the Tenants of the transfer
of ownership to Purchaser and a letter advising vendors under the Approved
Service Contracts of the change in ownership of the Property in the form
attached hereto as Exhibit 9.01(e)-2;


 


(f)            a non-foreign status certification duly
executed by Seller, certifying that Seller is not a “foreign person”, pursuant
to Section 1445 (as may be amended) of the Internal Revenue Code of 1986,
as amended (“Code”);


 


(g)         to the extent Seller can truthfully give
the same, an American Land Title Association extended coverage
statement/affidavit regarding title, mechanics liens and such other customary
matters as may be reasonably requested by the Title Insurance Company in order
to cause it to issue the Owner’s Title Insurance Policy to Purchaser as
contemplated by this Agreement;


 

















 


(h)         a schedule, certified by Seller, of rent
arrearages as of the Closing Date, together with an updated certified Rent Roll
including a certified schedule of other amounts (in each case separately
itemized) due from tenants;


 


(i)             certified resolutions, incumbency
certificates and other evidence reasonably satisfactory to Purchaser’s counsel
as to the authority of Seller to consummate the transactions contemplated by
this Agreement;


 


(j)             all keys for the Property in the
possession of Seller;


 


(k)          the Closing Statement signed by Seller,
setting forth the prorations and adjustments to be made pursuant to Article 8
above;


 


(l)              an affidavit or other statement
acceptable to Escrow Agent providing the information necessary for the Escrow
Agent to file the Form 1099 required by the provisions of Section 6045(e) of
the Code and the Escrow Agent’s acceptance of the obligation to file such form;


 


(m)       Colorado Department of Revenue Form 1083
and, if applicable, Form 1079 and any other necessary state, county or
local governmental transfer tax forms or returns; and


 


(n)         A certificate certifying to Purchaser
that all representations and warranties of Seller contained herein are true and
correct as of Closing, or if untrue, specifying which are not true and correct.


 


9.02.                        Purchaser shall deliver, or cause to be delivered to
Seller on the Closing Date:


 


(a)          the balance of the Purchase Price due
pursuant to Section 1.02, in immediately available funds by Federal
Reserve Bank wire transfer to such account(s) and bank(s) as Seller
shall designate in writing;


 


(b)         four originals of the Assignment and
Assumption of Leases duly executed by Purchaser;


 


(c)          four originals of the Assignment and
Assumption of Contracts duly executed by Purchaser;


 


(d)         certified resolutions (which may be
standing resolutions) as to the authority of Purchaser to consummate the
transactions contemplated by this Agreement;


 


(e)          the Closing Statement signed by
Purchaser; and


 


(f)            Form TD 1000 (Real Property Transfer
Declaration) and any other necessary state, county or local governmental
transfer tax forms or returns.


 

















 


(g)         A certificate certifying to Seller that
all representations and warranties of Purchaser contained herein are true and
correct as of Closing, or if untrue, specifying which are not true and correct.


 


10.                                 Notices.  All notices
required or permitted to be given pursuant to the terms hereof shall be in
writing and shall be delivered either by (a) certified mail, return
receipt requested, in which case notice shall be deemed received three (3) business
days after deposit, postage prepaid in the U.S. mail, (b) a reputable
messenger service or a nationally recognized overnight courier, in which case
notice shall be deemed received one (1) business day after deposit with
such messenger or courier, (c) facsimile or other telecopy transmission
(followed with “hard copy” sent by a nationally recognized overnight courier or
mail as aforesaid), in which case notice shall be deemed received when the
facsimile or other telecopy transmission is received, provided such receipt
occurs before 6:00 p.m. recipient’s local time on a business day,
otherwise at 8:30 a.m. recipient’s local time on the next business day or (d) personal
delivery with receipt acknowledged in writing, in which case notice shall be
deemed received upon delivery.  Notices
shall be deemed given or sent upon deposit in the U.S. mail in the case of
clause (a) above, or upon deposit with a reputable messenger or courier in
the case of clause (b) above. 
Notices shall be deemed given or sent upon receipt of electronic
confirmation in the case of clause (c) above or upon receipt in the case
of clause (d).  All such notices shall be
addressed as follows:


 


	
  To Seller:

  	
  c/o Sentinel Real Estate Corporation.

  1251 Avenue of the Americas

  New York, New York 10020

  Telephone:                                  (212) 408-2911

  Facsimile:               (212) 603-8253

  Attention:                                       Mr. Robert Kass

  
	
   

  	
   

  
	
  With a copy to:

  	
  Seward & Kissel LLP

  One Battery Park Plaza

  New York, New York 10004

  Telephone:                                  (212) 574-1364

  Facsimile:               (212) 480-8421

  Attention:                                       Mark Brody, Esq.

  
	
   

  	
   

  
	
  To Purchaser:

  	
  Behringer Harvard Multifamily OP I LP

  15601 Dallas Parkway, Suite 600

  Addison, Texas 75001

  Telephone:                                  (214) 655-1600

  Facsimile:               (214) 655-1610

  Attention:                                         Mark T. Alfieri

  
	
   

  	
   

  
	
  With copies to:

  	
  Miller, Egan, Molter &
  Nelson LLP

  4514 Cole Avenue, Suite 1250

  Dallas, Texas 
  75205

  



 

















 


	
   

  	
  Telephone:                                    (214) 628-9502

  Facsimile:               (214) 628-9505

  Attention:                                         Walter D. Miller, Esq.

  
	
   

  	
   

  
	
  To Escrow Agent:

  	
  First American Title Insurance Company of New York

  Telephone:                                    (212) 850-0632

  Facsimile:               (212) 331-1506

  Attention:                                         Bruce Clay

  



 


The foregoing addresses may be changed by written notice to the other
party as provided herein. Counsel for any party may give notices to the other
party with the same effect as if given by the party.  Rejection or other refusal to accept or
inability to deliver because of changed address of which no notice was given
shall be deemed to be receipt of the notice, request or other communication.


 


11.                                 Damage to Property; Taking.


 


11.01.                  If, prior to the Closing, the Property or any part thereof (i) is
damaged by casualty for which in the judgment of a licensed architect or
Engineer selected by Seller with reasonable approval by Purchaser the cost of
repair does not exceed, in the aggregate, one million and No/100ths Dollars
($1,000,000.00), the Closing shall proceed
without regard to such damage and Seller shall assign to Purchaser all
insurance proceeds, and claims of Seller thereto, attributable to the Property
arising from the casualty, together with the proceeds of any rent loss
insurance allocable to periods after the Closing Date, and Purchaser shall
receive a credit against the Purchase Price equal to the positive difference,
if any, of (a) the expected cost of such repair as determined above less (b) the
amount of insurance proceeds expected to be realized (other than rent loss
insurance proceeds for periods after the Closing Date which shall be assigned
to Purchaser as described above) as a result of such casualty, taking into
account that (x) deductibles, (y) coinsurance requirements and (z) damage
from such casualty, the cost of repairing of which is not covered by existing
insurance, will reduce the amount of insurance proceeds expected to be
realized, all as reasonably determined by Seller, subject to the reasonable
approval of Purchaser.  Purchaser’s
credit described in the immediately preceding sentence shall be reduced by the
reasonable cost of repairs incurred by Seller in order to shore up any
dangerous condition at the Property.  If,
prior to the Closing, there has been any taking by eminent domain, but there
has been no Material Taking (as defined below), the Closing shall proceed
without regard to any such taking by eminent domain and Seller shall pay over
and assign to Purchaser all awards recovered or recoverable on account of such
taking.


 


11.02.                  If the Property or any part thereof (i) is damaged by casualty for
which in the judgment of a licensed architect or Engineer selected by Seller
with reasonable approval by Purchaser the cost of repair is in excess of one
million and No/100ths Dollars ($1,000,000.00), or
(ii) is taken by eminent domain prior to the Closing Date which materially
and adversely affects the then current use or value of the Property, including
but not limited to a materially adverse change in access to the Property or the
taking of all or any material part of the building located at the Property (a “Material
Taking”), either Seller or Purchaser may elect to terminate this


 

















 


Agreement by sending written notice to the other party within thirty
(30) days of learning of the same, and the Closing Date shall be extended, if
necessary, to provide Purchaser or Seller with a full thirty (30) days to make
such determination.  Upon such
termination, the Deposit shall be promptly returned to Purchaser and Purchaser
shall destroy or return or cause to be returned to Seller all unreturned
Property Materials received by Purchaser and its agents and representatives
from Seller and the parties shall have no further rights or obligations hereunder
except as otherwise expressly provided herein. 
If neither party terminates this Agreement pursuant to the preceding
sentence, the Closing shall proceed without regard to such damage, taking or
notice of taking, as the case may be, and Seller shall assign to Purchaser all
insurance proceeds, and claims of Seller thereto, attributable to the Property
arising from the casualty, together with the proceeds of any rent loss
insurance allocable to periods after the Closing Date, and Purchaser shall
receive a credit against the Purchase Price equal to the deductible amount
and/or coinsurance amount under the applicable insurance policy, or Seller
shall pay over and assign to Purchaser all awards recovered or recoverable on
account of such taking, as the case may be. 
If neither party terminates this Agreement pursuant to this Article 11,
then Seller shall not compromise, settle, or adjust any claims to such
proceeds, or awards, without Purchaser’s prior written consent, which consent
shall not unreasonably be withheld.


 


11.03.                  If and to the extent that Seller is required in this Article 11 to
assign and transfer to Purchaser all of Seller’s right, title, and interest in
and to insurance proceeds, and claims of Seller thereto, attributable to the
Property arising from the casualty, together with the proceeds of any rent loss
insurance allocable to periods after the Closing Date Seller shall, at the
election of Seller and at Purchaser’s expense, use commercially reasonable
efforts to cause its insurance carriers to either (i) pay any such unpaid
proceeds and insurance to Purchaser and for Purchaser’s benefit or (ii) pay
any such unpaid proceeds and insurance to Seller, in which case Seller shall
promptly remit the same to Purchaser  The
provisions of this Section 11.03 shall survive the Closing.


 


12.                                 Remedies.


 


12.01.                  In the event the transaction contemplated by this Agreement does not
close solely as a consequence of default by Purchaser, the Escrow Agent shall
deliver the Deposit to Seller and Seller shall retain the Deposit as liquidated
damages.  The parties have agreed that
Seller’s actual damages, in the event of a default by Purchaser, would be
extremely difficult or impracticable to determine.  THEREFORE, THE PARTIES ACKNOWLEDGE THAT THE
AMOUNT OF THE DEPOSIT HAS BEEN AGREED UPON AS THE PARTIES’ BEST, AND THEY
BELIEVE REASONABLE, ESTIMATE OF SELLER’S DAMAGES AND AS SELLER’S SOLE AND
EXCLUSIVE REMEDY AGAINST PURCHASER, AT LAW OR IN EQUITY, IN THE EVENT OF A
DEFAULT UNDER THIS AGREEMENT ON THE PART OF PURCHASER.  THE PARTIES FURTHER ACKNOWLEDGE THAT THE FOREGOING
LIQUIDATED DAMAGES ARE INTENDED NOT AS A PENALTY, BUT AS FULL LIQUIDATED
DAMAGES IN THE EVENT OF PURCHASER’S DEFAULT.


 


12.02.                  In the event that the Closing does not occur solely as a result of a
default on the part of Seller hereunder, Purchaser may, as its sole and
exclusive remedy, either


 

















 


(a) terminate this Agreement in which event the Deposit shall
immediately be returned to Purchaser, or (b) specifically enforce the
terms and conditions of this Agreement. 
Purchaser shall not be entitled to any other remedy for damages or
otherwise which it may have at law or in equity as a consequence of such
default; provided, however, in the event the remedy of specific performance is
not available to Purchaser due to willful act of Seller, Seller shall reimburse
Purchaser for Purchaser’s reasonable actual, out of pocket, third-party
expenses (including reasonable attorneys’ fees) incurred by it under the
Agreement, not to exceed $100,000.00 in the aggregate.  Prior to any reimbursement by Seller to
Purchaser described in the immediately preceding sentence, Purchaser shall
provide Seller with reasonable evidence of the incurrence and payment of any
such out of pocket expense by Purchaser.


 


12.03.                  The provisions of this Article 12 shall not limit or
restrict Purchaser or Seller from seeking to enforce or otherwise seeking
damages relating to any provisions of this Agreement which expressly survive
the termination of this Agreement, Purchaser’s indemnity of Seller pursuant to Section 2.01
above, or the mutual indemnities set forth in Article 6 above.


 


13.                                 Escrow.


 


13.01.                  The Deposit shall be held in escrow by Escrow Agent in an interest
bearing account until disbursed as herein provided.  Any interest accrued on the Deposit shall be
paid to whichever party is entitled to the Deposit in accordance with the
provisions of this Agreement. The Deposit shall be held and disbursed by Escrow
Agent in the following manner:


 


(a)          to Seller at the Closing upon
consummation of the Closing; or


 


(b)         to Seller upon receipt by Escrow Agent of
written demand therefor, stating (i) that Purchaser has defaulted in the
performance of Purchaser’s obligations under this Agreement and the facts and
circumstances underlying such default or (ii) that Seller is otherwise
entitled to the Deposit pursuant to the terms of this Agreement; provided,
however, that Escrow Agent shall not honor such demand until at least ten (10) days
after it has sent a copy of such demand to Purchaser, nor thereafter, if Escrow
Agent shall have received written notice of objection from Purchaser in
accordance with the provisions of Section 13.02; or


 


(c)          to Purchaser upon receipt of written
demand therefor, stating that either (i) this Agreement has been
terminated pursuant to a provision hereof and certifying the basis for such
termination, or (ii) Seller shall have defaulted in performance of Seller’s
obligations under this Agreement and the facts and circumstances underlying
such default or that Purchaser is otherwise entitled to the Deposit under the
provisions of this Agreement; provided, however, that Escrow Agent shall not
honor such demand until at least ten (10) days after it has sent a copy of
such demand to Seller, nor thereafter if Escrow Agent shall have received written
notice of objection from Seller in accordance with the provisions of Section 13.02.  Notwithstanding the foregoing, if Escrow
Agent receives a written demand from Purchaser for the return of the Deposit on
or before the expiration of the Due Diligence Period, then Escrow Agent shall
immediately send notice thereof to Seller and comply with said demand
notwithstanding any contrary instruction Escrow Agent may receive from Seller.


 
















 


13.02.                  Upon receipt of written demand for the Deposit by
Purchaser or Seller pursuant to clause (b) or (c) of Section 13.01
(other than a demand from Purchaser on or before expiration of the Due
Diligence Period, as provided above), Escrow Agent shall promptly send a copy
thereof to the other party.  The other
party shall have the right to object to the delivery of the Deposit by sending
written notice of such objection to Escrow Agent within the greater of five (5) days
or three (3) business days after Escrow Agent delivers a copy of the
written demand to the objecting party but not thereafter.  Such notice shall set forth the basis for
objecting to the delivery of the Deposit. 
Upon receipt of such notice, Escrow Agent shall promptly send a copy
thereof to the party who made the written demand.


 


13.03.                  In the event of any dispute between the parties
regarding the Deposit, Escrow Agent shall disregard all instructions received
and at its option either (i) hold the Deposit until the dispute is
mutually resolved and Escrow Agent is advised of fact in writing by both Seller
and Purchaser, or Escrow Agent is otherwise instructed by a final
non-appealable judgment of a court of competent jurisdiction, or (ii) deposit
the Deposit into a court of competent jurisdiction (whereupon Escrow Agent
shall be released and relieved of any and all liability and obligations
hereunder from and after the date of such deposit).


 


13.04.                  In the event Escrow Agent shall be uncertain as to its
duties or rights hereunder or shall receive conflicting instructions, claims or
demands from the parties hereto, or instructions which conflict with any of the
provisions of this Agreement, Escrow Agent shall be entitled (but not
obligated) to refrain from taking any action other than to keep safely the
Deposit until Escrow Agent shall be instructed otherwise in writing signed by
both Seller and Purchaser, or by final judgment of a court of competent
jurisdiction.


 


13.05.                  Escrow Agent may rely upon, and shall be protected in
acting or refraining from acting upon, any written notice, instruction or
request furnished to it hereunder and believed by it to be genuine and to have
been signed or presented by the proper party or parties, provided that any
modification of this Article 13 shall be signed by Escrow Agent, Purchaser
and Seller.


 


13.06.                  Seller and Purchaser shall jointly and severally hold
Escrow Agent harmless against any loss, damage, liability or expense incurred
by Escrow Agent not caused by its willful misconduct or gross negligence, arising
out of or in connection with its entering into this Agreement and the carrying
out of its duties hereunder, including the reasonable costs and expenses of
defending itself against any claim of liability or participating in any legal
proceeding.  Escrow Agent may consult
with counsel of its choice, and shall have full and complete authorization and
protection for any action taken or suffered by it hereunder in good faith and
in accordance with the opinion of such counsel.


 


13.07.                  Escrow Agent may resign at will and be discharged from
its duties or obligations hereunder by giving notice in writing of such
resignation specifying a date when such resignation shall take effect;
provided, however, that (i) prior to such resignation a substitute escrow
agent is approved in writing by Seller and Purchaser, which approval shall not
be unreasonably withheld or delayed, or (ii) Escrow Agent shall deposit
the Deposit with a court of 


 

















 


competent jurisdiction.  After such resignation, Escrow Agent shall
have no further duties or liability hereunder.


 


13.08.                  Purchaser and Seller, together, shall have the right
to terminate the appointment of Escrow Agent hereunder by giving to it notice
of such termination, specifying the date upon which such termination shall take
effect and designating a replacement escrow agent, who shall sign a counterpart
of this Agreement.  Upon demand of such
successor escrow agent, the Deposit shall be turned over and delivered to such
successor escrow agent, who shall thereupon be bound by all of the provisions
hereof.


 


13.09.                  Seller and Purchaser shall be jointly and severally
responsible for the reimbursement to Escrow Agent of all out-of-pocket
expenses, disbursements and advances (including reasonable attorneys’ fees)
incurred or made by Escrow Agent in connection with the carrying out of its
duties hereunder.


 


13.10.                  Escrow Agent’s agreements and obligations hereunder
shall terminate and Escrow Agent shall be discharged from further duties and
obligations hereunder upon final payment of the Deposit in accordance with the
terms of this Agreement.


 


14.         Survival; Disclaimer; Waiver.


 


14.01.                  The representations, warranties, covenants, agreements
and indemnities contained in this Agreement shall not survive the Closing,
except to the extent otherwise expressly provided herein.


 


14.02.                  PURCHASER HEREBY ACKNOWLEDGES AND AFFIRMS THAT SELLER
DOES NOT, BY THE EXECUTION AND DELIVERY OF THIS AGREEMENT, AND SELLER SHALL
NOT, BY THE EXECUTION AND DELIVERY OF ANY DOCUMENT OR INSTRUMENT EXECUTED AND
DELIVERED IN CONNECTION WITH THE CLOSING, MAKE ANY WARRANTY, EXPRESS OR
IMPLIED, OF ANY KIND OR ANY NATURE WHATSOEVER WITH RESPECT TO THE PROPERTY (INCLUDING WITHOUT LIMITATION THE DIMENSIONS OR
THE SQUARE FOOTAGE OF THE PROPERTY), AND ALL SUCH WARRANTIES ARE HEREBY
DISCLAIMED, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, THE DEED
AND THE DOCUMENTS AND MATERIALS DELIVERED BY SELLER AT CLOSING.  EXCEPT AS EXPRESSLY PROVIDED IN THIS
AGREEMENT, THE DEED AND THE DOCUMENTS AND MATERIALS DELIVERED BY SELLER AT
CLOSING, SELLER MAKES NO EXPRESS OR IMPLIED WARRANTY OF SUITABILITY OR FITNESS
OF THE PROPERTY FOR ANY PURPOSE, OR AS TO THE MERCHANTABILITY, TITLE, VALUE,
QUALITY, CONDITION OR SALABILITY OF ANY OF THE PROPERTY.  THE SALE OF THE PROPERTY BY SELLER TO PURCHASER
SHALL BE “AS IS” AND “WHERE IS” AND PURCHASER IS RELYING SOLELY ON THE TITLE
COMMITMENT AS TO TITLE MATTERS AND THE RESULTS OF ITS TESTS AND INSPECTIONS AS
TO THE PHYSICAL CONDITION OF THE PROPERTY EXCEPT AS OTHERWISE EXPRESSLY
PROVIDED IN THIS AGREEMENT, THE DEED AND SUCH DOCUMENTS AND 


 

















 


MATERIALS DELIVERED BY SELLER AT CLOSING. PURCHASER
HEREBY ACKNOWLEDGES THAT IT HAS NOT RELIED AND WILL NOT RELY ON, AND SELLER IS
NOT LIABLE OR BOUND BY, ANY EXPRESS OR IMPLIED WARRANTIES, GUARANTIES, STATEMENTS,
REPRESENTATIONS OR INFORMATION PERTAINING TO THE PROPERTY OR RELATING THERETO
(INCLUDING SPECIFICALLY, WITHOUT LIMITATION, OFFERING PACKAGES DISTRIBUTED WITH
RESPECT TO THE PROPERTY) MADE OR FURNISHED BY SELLER, THE MANAGER OF THE
PROPERTY OR ANY REAL ESTATE ADVISOR OR AGENT REPRESENTING OR PURPORTING TO
REPRESENT SELLER, TO WHOMEVER MADE OR GIVEN DIRECTLY OR INDIRECTLY, ORALLY OR
IN WRITING, UNLESS SPECIFICALLY SET FORTH IN THIS AGREEMENT, THE DEED OR SUCH
DOCUMENTS AND MATERIALS TO BE DELIVERED BY SELLER AT CLOSING.


 


14.03.                  WITHOUT LIMITING THE GENERALITY OF SECTION 14.02,
PURCHASER ACKNOWLEDGES THAT CERTAIN MATERIALS AND SUBSTANCES THAT WERE IN
COMMON USE WITHOUT REGULATION AT AND SINCE THE ORIGINAL CONSTRUCTION OF THE
IMPROVEMENTS MAY NOW BE DEEMED TO BE HAZARDOUS MATERIALS OR HAZARDOUS
SUBSTANCES UNDER APPLICABLE LAW OR THE USE, OR THE METHOD OF USE, OF SUCH ITEMS
MAY NOW BE PROHIBITED OR REGULATED, THAT SOME OF THOSE MATERIALS AND
SUBSTANCES MAY HAVE BEEN USED IN THE ORIGINAL CONSTRUCTION OF THE IMPROVEMENTS
OR THE SUBSEQUENT MAINTENANCE OF THE PROPERTY, THAT PRIOR OWNERS OF THE
PROPERTY OR ADJACENT PROPERTY MAY HAVE STORED, RELEASED, TRANSPORTED OR
OTHERWISE DISPOSED OF MATERIAL ON SUCH PROPERTIES DEEMED TO BE HAZARDOUS
SUBSTANCES UNDER APPLICABLE LAW, AND THAT, NOTWITHSTANDING SELLER MAKING
AVAILABLE ANY ENVIRONMENTAL STUDIES, ENGINEERING REPORTS OR OTHER
INVESTIGATIONS, PURCHASER SHALL BE SOLELY RESPONSIBLE FOR ALL INVESTIGATION OR
INQUIRY INTO SUCH ITEMS AND NEITHER SELLER NOR ITS PREDECESSORS IN TITLE SHALL
HAVE ANY LIABILITY WHATSOEVER TO PURCHASER FOR ANY CLAIMS RELATING TO OR
ARISING FROM THE EXISTENCE, REMOVAL AND REMEDIATION (INCLUDING CONSEQUENTIAL
DAMAGES) OF SUCH ITEMS.  THE FOREGOING
SHALL NOT BE INTERPRETED TO WAIVE ANY CLAIM OF PURCHASER WITH RESPECT TO ANY
BREACH BY SELLER OF ITS REPRESENTATIONS AND WARRANTIES IN THIS AGREEMENT AND
THE DOCUMENTS AND MATERIALS TO BE DELIVERED BY SELLER AT CLOSING.  PURCHASER
REPRESENTS TO SELLER THAT PURCHASER HAS CONDUCTED, OR DURING THE DUE DILIGENCE
PERIOD, WILL CONDUCT SUCH INVESTIGATIONS OF THE PROPERTY, INCLUDING BUT NOT
LIMITED TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS THEREOF, AS PURCHASER
DEEMS NECESSARY OR DESIRABLE TO SATISFY ITSELF AS TO THE CONDITION OF THE
PROPERTY AND THE EXISTENCE OR NON-EXISTENCE OR CURATIVE ACTION TO BE TAKEN WITH
RESPECT TO ANY HAZARDOUS MATERIALS ON OR DISCHARGED FROM THE PROPERTY, AND WILL
RELY SOLELY UPON SAME AND NOT UPON ANY INFORMATION PROVIDED BY OR ON BEHALF OF
SELLER OR ITS AGENTS OR EMPLOYEES WITH RESPECT THERETO, OTHER THAN 


 

















 


SUCH REPRESENTATIONS, WARRANTIES
AND COVENANTS OF SELLER, IF ANY, AS ARE EXPRESSLY SET FORTH IN THIS
AGREEMENT.  UPON CLOSING, PURCHASER SHALL
ASSUME THE RISK THAT ADVERSE PHYSICAL AND ENVIRONMENTAL CONDITIONS, MAY NOT
HAVE BEEN REVEALED BY PURCHASER’S INVESTIGATIONS, AND PURCHASER, UPON CLOSING,
SHALL BE DEEMED (EXCEPT AS OTHERWISE EXPRESSLY SET FORTH HEREIN OR WITH RESPECT
TO SELLER’S OBLIGATIONS SET FORTH IN THE DOCUMENTS TO BE DELIVERED BY SELLER AT
CLOSING AND FOR CLAIMS OF FRAUD ON THE PART OF SELLER) TO HAVE WAIVED,
RELINQUISHED AND RELEASED SELLER (AND SELLER’S OFFICERS, TRUSTEES, DIRECTORS,
SHAREHOLDERS, EMPLOYEES AND AGENTS) FROM AND AGAINST ANY AND ALL CLAIMS,
DEMANDS, CAUSES OF ACTION (INCLUDING CAUSES OF ACTION IN TORT) LOSSES, DAMAGES,
LIABILITIES, COSTS AND EXPENSES (INCLUDING REASONABLE ATTORNEYS’ FEES) OF ANY
AND EVERY KIND OR CHARACTER, KNOWN OR UNKNOWN WHICH PURCHASER MIGHT HAVE
ASSERTED OR ALLEGED AGAINST SELLER (AND SELLER’S OFFICERS, TRUSTEES, DIRECTORS,
SHAREHOLDERS, EMPLOYEES AND AGENTS) AT ANY TIME BY REASON OF OR ARISING OUT OF
ANY LATENT OR PATENT CONSTRUCTION DEFECTS OR PHYSICAL CONDITIONS, VIOLATIONS OF
ANY APPLICABLE LAWS AND ANY AND ALL OTHER ACTS, OMISSIONS, EVENTS,
CIRCUMSTANCES OR MATTERS REGARDING THE PROPERTY; PROVIDED, HOWEVER, THAT
NOTHING CONTAINED HEREIN SHALL LIMIT, IMPAIR OR OTHERWISE AFFECT ANY RIGHTS OF
PURCHASER AGAINST (I) PARTIES UNRELATED TO SELLER ARISING UNDER ANY OF THE
CONTRACTS, AGREEMENTS OR RIGHTS ASSIGNED BY SELLER TO PURCHASER PURSUANT TO
THIS AGREEMENT, AND (II) ANY RIGHT OF CONTRIBUTION WHICH PURCHASER MAY HAVE
AGAINST SELLER IN RESPECT OF ANY CLAIM MADE AGAINST PURCHASER BY ANY THIRD
PARTY (OTHER THAN PURCHASER’S AFFILIATES) IN RESPECT OF ANY TORT THAT OCCURRED
PRIOR TO CLOSING.


 


14.04.                  The provisions of this Article 14 shall survive
the Closing.


 


15.         Miscellaneous.


 


15.01.                  No waiver by any party of any breach hereunder shall
be deemed a waiver of any other or subsequent breach.


 


15.02.                  This Agreement may not be altered, amended, changed,
waived, terminated or modified in any respect or particular unless the same
shall be in writing and signed by or on behalf of the parties hereto.


 


15.03.                  This Agreement shall be binding upon and inure to the
benefit of the parties hereto and to their respective successors and
assigns.  Purchaser may not assign its
interest in this Agreement without Seller’s prior consent.  Notwithstanding the preceding sentence, and
without limitation to Purchaser’s rights under Section 15.15 hereof, upon
written notice to Seller at least five (5) business days prior to Closing,
Purchaser shall have the one time 


 

















 


right to assign this Agreement to any entity that is
both (i) an entity directly or indirectly controlling or controlled by or
under direct or indirect common control with Purchaser, Behringer
Harvard Holdings, LLC or Behringer Harvard Multifamily REIT I, Inc. and (ii) at least 51% owned directly
or indirectly by Purchaser, Behringer Harvard Holdings, LLC or Behringer
Harvard Multifamily REIT I, Inc.  As used in
this Agreement, the term “Purchaser” shall be deemed to include any permitted
assignee, designee or other transferee of the initial Purchaser.  Seller may not assign any of its rights
hereunder without the prior consent of Purchaser. No assignment by Purchaser
shall relieve Purchaser of any obligations hereunder without the execution of
and the delivery to Seller of an assignment and assumption of this Agreement in
form and substance reasonably satisfactory to Seller.


 


15.04.                  All understandings and agreements heretofore had
between the parties hereto are merged into this Agreement and the Exhibits
hereto, which fully and completely express the parties’ agreement with respect
to all matters pertaining to the Property.


 


15.05.                  This Agreement shall be governed by and construed in
accordance with the laws of the State of Colorado without reference to the
choice of law doctrine of such State.


 


15.06.                  Each of the Exhibits attached hereto is hereby
incorporated herein and made a part of this Agreement for all purposes.


 


15.07.                  This Agreement is for the sole and exclusive benefit
of the parties hereto and their respective permitted successors and assigns,
and, except as specifically provided in Article 13, no third party is
intended to or shall have any rights hereunder.


 


15.08.                  (a)          The headings and captions herein are
inserted for convenient reference only and the same shall not limit or construe
the paragraphs or sections to which they apply or otherwise affect the
interpretation hereof.


 


(b)         Unless the context otherwise requires,
the terms “hereby”, “hereof”, “herein”, “hereunder” and any similar terms shall
refer to this Agreement, and the term “hereafter” shall mean after, and the
term “heretofore” shall mean before the date of this Agreement.


 


(c)          Unless the context otherwise requires,
words of the masculine, feminine or neuter gender shall mean and include the
correlative words of other genders, and words importing the singular number
shall mean and include the plural number and vice versa.


 


(d)         Words importing persons shall include
firms, associations, partnerships (including limited partnerships), limited
liability companies, trusts, corporations and other legal entities, including
public bodies, as well as natural persons.


 


(e)          An “affiliate” of any specified person
means any other person directly or indirectly controlling or controlled by or
under direct or indirect common control with such specified person; provided
that if a person holds, directly or indirectly, a beneficial interest of 10% or
more in such specified person or is an officer, director, general partner,
trustee or a 


 

















 


family member of such specified person, such person
shall be deemed to be an affiliate of such specified person. For the purposes
of the foregoing definition, a family member shall include a spouse, a child
(natural or adopted), a spouse of any such child, a grandchild, a sister, a
brother, a parent, a lineal descendant of any of the foregoing or a trust for
the benefit of any of the foregoing.


 


(f)            The terms “include”, “including” and similar terms
shall be construed as if followed by the phrase “without limitation”.


 


15.09.                  The parties agree that no trustee, officer, director,
shareholder, limited partner, principal, parent, affiliate, member, manager or
agent of any of the parties hereto shall be held to any personal liability for
any obligation of, or claim against such party, and the parties agree to look
only to the assets of the other parties for sums payable by, or the performance
of any obligation of, such parties, except to the extent permitted by law in
connection with any claim based upon the intentional or willful fraud or
intentional or willful misconduct, or the intentional or willful misapplication
of funds or any other misapplication which constitutes direct conversion of
such funds by such party or any affiliates of such party.


 


15.10.                  In the event of any litigation between the parties
hereto concerning the terms hereof, the losing party shall pay the reasonable
attorneys’ fees and costs incurred by the prevailing party in connection with
such litigation, including appeals.  This
Section 15.10 shall survive the Closing or the termination of this
Agreement.


 


15.11.


 


(a)          Neither Purchaser nor its general partner is, nor will
they become, an entity with whom United States persons or entities are
restricted from doing business under regulations of the Office of Foreign Asset
Control (“OFAC”) of the Department of the Treasury (including those
named on OFAC’s Specially Designated and Blocked Persons List) or under any
statute, executive order (including the September 24, 2001, Executive
Order Blocking Property and Prohibiting Transactions with Persons Who Commit,
Threaten to Commit, or Support Terrorism), or other governmental action and is
not and will not engage in any dealings or transactions or be otherwise
associated with such persons or entities.


 


(b)         Neither Seller nor any of its partners, members,
shareholders or other equity owners is, nor will they become, a person or
entity with whom United States persons or entities are restricted from doing
business under regulations of the Office of Foreign Asset Control (“OFAC”)
of the Department of the Treasury (including those named on OFAC’s Specially
Designated and Blocked Persons List) or under any statute, executive order
(including the September 24, 2001, Executive Order Blocking Property and
Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or
Support Terrorism), or other governmental action and is not and will not engage
in any dealings or transactions or be otherwise associated with such persons or
entities.


 


(c)          This Section 15.11 shall survive Closing.


 

















 


15.12.                  This Agreement may be executed in any number of
identical counterparts, each of which shall be deemed an original, but all of
which together shall constitute but one and the same agreement.  Handwritten signatures to this Agreement
transmitted by telecopy or electronic transmission (for example, through use of
a Portable Document Format or “PDF” file) shall be valid and effective to bind
the party so signing.  Each party agrees
to promptly deliver to the other party an executed original of this Agreement
with its actual signature, but a failure to do so shall not affect the
enforceability of this Agreement, it being expressly agreed that each party to
this Agreement shall be bound by its own telecopied or electronically
transmitted handwritten signature and shall accept the telecopied or
electronically transmitted handwritten signature of the other party to this
Agreement.


 


15.13.                  Time is of the essence of this Agreement.  In the event the last day for performance of
any matter herein falls on a Saturday, Sunday or legal holiday in the States of
Colorado, Texas or New York, the time for performance shall automatically be
extended to the next business day.


 


15.14.                  If any term, covenant or condition of this Agreement
or the application thereof to any person or circumstance shall, to any extent,
be invalid or unenforceable, the remainder of this Agreement and the
application of such terms, covenants and conditions to persons or circumstances
other than those as to which it is held invalid or unenforceable, shall not be
affected thereby and each term, covenant and condition of this Agreement shall
be valid and be enforced to the fullest extent permitted by law.


 


15.15.                  Notwithstanding the prohibitions
against assignment contained in Section 15.03, Purchaser may consummate
the acquisition of the Property from Seller as part of a so-called like kind
exchange (an “Exchange”) qualifying under §1031 of the Code, provided
that: (a) the Closing shall not be delayed or affected by reason of the
Exchange, nor shall the consummation or accomplishment of an Exchange be a
condition precedent or condition subsequent to Purchaser’s obligations under
this Agreement; (b) Purchaser shall effect the Exchange through an
assignment of this Agreement, or its rights and obligations under this
Agreement, to a “qualified intermediary” (as such term is defined in the
applicable Treasury Regulations promulgated under Code §1031) (but such
assignment shall not release Purchaser of any liability hereunder); (c) Seller
shall not be required to take an assignment of the purchase and sale agreement
for the relinquished or replacement property or be required to acquire or hold
title to any real property for purposes of consummating an exchange desired by
Purchaser; and (d) Purchaser shall pay any additional costs that would not
otherwise have been incurred by Seller had Purchaser not consummated the
transaction through an Exchange and shall indemnify Seller for all costs loss
and liability resulting therefrom. 
Seller shall not, by this Agreement or by its acquiescence to an
Exchange desired by Purchaser, have its rights under this Agreement affected or
diminished in any manner or be responsible in any way for any matter relating
to the Exchange.  Without limiting the
generality of the foregoing, Seller shall not be responsible for compliance
with or be deemed to have warranted to any party that the Exchange in fact
complies with §1031 of the Code.  This Section 15.15
shall survive Closing


 

















 


15.16.                  Seller and Purchaser hereby designate the Title
Insurance Company to act as and perform the duties and obligations of the “reporting
person” with respect to the transaction contemplated by this Agreement for
purposes of 26 C.F.R. Section 1.6045-4(e)(5) relating to the
requirements for information reporting on real estate transactions closed on or
after January 1, 1991.


 


15.17.                  IN ANY LAWSUIT OR OTHER PROCEEDING INITIATED BY SELLER
OR PURCHASER UNDER OR WITH RESPECT TO THIS AGREEMENT, SELLER AND PURCHASER EACH
WAIVE ANY RIGHT IT MAY HAVE TO TRIAL BY JURY.


 


15.18.                  Each party has been represented by legal counsel in
connection with the negotiation of the transactions herein contemplated and the
drafting and negotiation of this Agreement. 
Each party and its counsel have had an opportunity to review and suggest
revisions to the language of this Agreement. 
Accordingly, no provision of this Agreement shall be construed for or
against or interpreted to the benefit or disadvantage of any party by reason of
any party having or being deemed to have structured or drafted such provision.


 


15.19.                  Subject to the requirements of applicable law and the
provisions of this Section 15.19, Seller and Purchaser each hereby
covenant that it will not issue any press release or other public written
statement with respect to the transaction contemplated hereunder (a “Release”)
without the consent of the other party hereto, which consent shall not be
unreasonably conditioned, withheld or delayed so long as such Release does not
identify any economic terms of the transaction contemplated hereunder or
identify Seller; provided, however, Seller and Purchaser each may, without the
consent of the other party hereto, issue any Release to its affiliates, agents,
prospective investors and their advisors, attorneys, representatives,
consultants, the making of which is required or deemed advisable by Seller or
Purchaser, as applicable, or its respective counsel, to be disclosed in
connection with financial reporting, securities disclosures or other legal, tax
or financial requirements or legal guidelines applicable to such party or its
respective affiliates.  This Section 15.19
shall survive the Closing.


 


15.20.                  During the term of this Agreement Seller shall not
enter into any other agreement for the purchase and sale of the Real Property.


 


15.21.                  Seller acknowledges that audited financial statements
and operating reports and statements (including, without limitation, rental
revenue, repairs and maintenance expenses, utilities, payroll, real estate
taxes, insurance, management fees, etc.) of the Property for one prior calendar
year of operation and the portion of the calendar year in which the Closing
occurs up to the Closing Date may be required to be filed by Purchaser
with the Securities and Exchange Commission (the “SEC Requirements”), from time
to time, after the Closing, but in no event later than March 31,
2012.  Accordingly, Seller agrees, upon
reasonable advance notice delivered prior to March 31, 2012, to reasonably
cooperate with Purchaser in such event to provide Purchaser and its
representatives with copies of such financial records and financial information
as may be necessary to satisfy the SEC Requirements but only to the extent the
same are in Seller’s possession or reasonable control.


 

















 


[Signature Page Follows]


 

















 


IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be executed the day and year first above written.


 


	
   

  	
  SELLER:

  
	
   

  	
  4550 CHERRY CREEK TOWER
  APARTMENTS, LLC, a Colorado limited liability company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Kass

  
	
   

  	
  Name:

  	
  Robert Kass

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PURCHASER:

  
	
   

  	
  BEHRINGER HARVARD
  MULTIFAMILY OP I LP, a Delaware limited partnership

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  BHMF, Inc.

  
	
   

  	
   

  	
  a Delaware corporation

  
	
   

  	
   

  	
  its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Robert T. Poynter

  
	
   

  	
   

  	
  Name:

  	
  Robert T. Poynter

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  



 

















 


	
  The undersigned acknowledged accepts appointment as
  Escrow Agent, agrees to act as escrow holder in accordance with this
  Agreement and acknowledges upon its receipt of the Deposit it shall hold
  those funds in accordance with and subject to the terms of this Agreement.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  FIRST AMERICAN TITLE INSURANCE COMPANY OF NEW YORK

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Serena Levy

  	
   

  	
   

  
	
   

  	
  Name: Serena Levy 

  	
   

  	
   

  
	
   

  	
  Title: AVP