**Exhibit 10.10**

 

**SALE, PURCHASE AND ESCROW AGREEMENT**

 

BETWEEN

 

 

**VERANDAH OWNER LIMITED PARTNERSHIP**

(Seller)

 

 

AND

 

 

**HARVARD PROPERTY TRUST, LLC**

(Purchaser)

 

 

AND

 

 

**PARTNERS TITLE COMPANY**

(Escrow Agent)

 

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**TABLE OF CONTENTS**

 

**Table of Contents**

** **
| ** **                                                                           | ** ** | ** ** | ** **                                                | ** ** | **Page**   |
|--------------------------------------------------------------------------------------|------------|------------|-----------------------------------------------------------|------------|------------|
| ** **                                                                           | ** ** | ** ** | ** **                                                | ** ** | ** ** |
| ARTICLE I PURCHASE AND SALE                                                          |       | 1          |
|                                                                                 | **1.1**    | ** ** | **Background**                                            |       | 1          |
|                                                                                 | **1.2**    | ** ** | **Purchase and Sale**                                     |       | 1          |
|                                                                                 |       |       |                                                      |       |       |
| ARTICLE II PURCHASE PRICE                                                            |       | 3          |
|                                                                                 | **2.1**    | ** ** | **Price**                                                 |       | 3          |
|                                                                                 | **2.2**    | ** ** | **Investments**                                           |       | 3          |
|                                                                                 | **2.3**    | ** ** | **Interest on the Deposit**                               |       | 4          |
|                                                                                 | **2.4**    | ** ** | **Existing Loan**                                         |       | 4          |
|                                                                                 | **2.5**    | ** ** | **Option Consideration**                                  |       | 5          |
|                                                                                 |       |       |                                                      |       |       |
| ARTICLE III CONDITIONS TO THE PARTIES’ OBLIGATIONS                              |       | 5          |
|                                                                                 | **3.1**    | ** ** | **Conditions to Purchaser’s Obligation to Purchase** |       | 5          |
|                                                                                 | **3.2**    | ** ** | **Conditions to Seller’s Obligation to Sell**        |       | 6          |
|                                                                                 |       |       |                                                      |       |       |
| ARTICLE IV PURCHASER’S DELIVERIES AND SELLER’S DELIVERIES TO ESCROW  AGENT |       | 7          |
|                                                                                 | **4.1**    | ** ** | **Purchaser’s Deliveries**                           |       | 7          |
|                                                                                 | **4.2**    | ** ** | **Seller’s Deliveries**                              |       | 7          |
|                                                                                 | **4.3**    | ** ** | **Failure to Deliver**                                    |       | 8          |
|                                                                                 |       |       |                                                      |       |       |
| ARTICLE V INVESTIGATION OF PROPERTY                                                  |       | 8          |
|                                                                                 | **5.1**    | ** ** | **Survey**                                                |       | 8          |
|                                                                                 | **5.2**    | ** ** | **Intentionally Deleted**                                 |       | 8          |
|                                                                                 | **5.3**    | ** ** | **Review of Survey and Title**                            |       | 8          |
|                                                                                 | **5.4**    | ** ** | **Inspection of Property**                                |       | 9          |
|                                                                                 | **5.5**    | ** ** | **Operational Information**                               |       | 10         |
|                                                                                 | **5.6**    | ** ** | **No Obligation to Cure**                                 |       | 11         |
|                                                                                 | **5.7**    | ** ** | **Inspection Period**                                     |       | 11         |
|                                                                                 | **5.8**    | ** ** | **Right to Audit**                                        |       | 11         |
|                                                                                 | **5.9**    | ** ** | **Proprietary Documents; Confidentiality**                |       | 11         |
|                                                                                 | **5.10**   | ** ** | **Purchaser’s Responsibilities**                     |       | 12         |
|                                                                                 | **5.11**   | ** ** | **Purchaser’s Agreement to Indemnify**               |       | 12         |
|                                                                                 |       |       |                                                      |       |       |
| ARTICLE VI THE CLOSING                                                               |       | 13         |
|                                                                                 | **6.1**    | ** ** | **Date and Manner of Closing**                            |       | 13         |
|                                                                                 |       |       |                                                      |       |       |
| ARTICLE VII PRORATION, FEES, COSTS AND ADJUSTMENTS                                   |       | 13         |
|                                                                                 | **7.1**    | ** ** | **Prorations**                                            |       | 13         |
|                                                                                 | **7.2**    | ** ** | **Seller’s Closing Costs**                           |       | 16         |

 

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|                                                      | **7.3**    | ** ** | **Purchaser’s Closing Costs**                        |       | 16         |
|-----------------------------------------------------------|------------|------------|-----------------------------------------------------------|------------|------------|
| ** **                                                | ** ** | ** ** | ** **                                                | ** ** | ** ** |
| ARTICLE VIII DISTRIBUTION OF FUNDS AND DOCUMENTS          |       | 16         |
|                                                      | **8.1**    | ** ** | **Delivery of the Purchase Price**                        |       | 16         |
|                                                      | **8.2**    | ** ** | **Other Monetary Disbursements**                          |       | 16         |
|                                                      | **8.3**    | ** ** | **Recorded Documents**                                    |       | 16         |
|                                                      | **8.4**    | ** ** | **Documents to Purchaser**                                |       | 16         |
|                                                      | **8.5**    | ** ** | **Documents to Seller**                                   |       | 17         |
|                                                      | **8.6**    | ** ** | **All Other Documents**                                   |       | 17         |
| ** **                                                | ** ** | ** ** | ** **                                                | ** ** | ** ** |
| ARTICLE IX RETURN OF DOCUMENTS AND FUNDS UPON TERMINATION |       | 17         |
|                                                      | **9.1**    | ** ** | **Return of Seller’s Documents**                     |       | 17         |
|                                                      | **9.2**    | ** ** | **Return of Purchaser’s Documents**                  |       | 17         |
|                                                      | **9.3**    | ** ** | **Deposit**                                               |       | 18         |
|                                                      | **9.4**    | ** ** | **Disbursement of Deposit**                               |       | 18         |
|                                                      | **9.5**    | ** ** | **No Effect on Rights of Parties; Survival**              |       | 18         |
| ** **                                                | ** ** | ** ** | ** **                                                | ** ** | ** ** |
| ARTICLE X DEFAULT                                         |       | 18         |
|                                                      | **10.1**   | ** ** | **Seller’s Remedies**                                |       | 18         |
|                                                      | **10.2**   | ** ** | **Purchaser’s Remedies**                             |       | 19         |
| ** **                                                | ** ** | ** ** | ** **                                                | ** ** | ** ** |
| ARTICLE XI REPRESENTATIONS AND WARRANTIES                 |       | 20         |
|                                                      | **11.1**   | ** ** | **Seller’s Warranties and Representations**          |       | 20         |
|                                                      | **11.2**   | ** ** | **Purchaser’s Warranties and Representations**       |       | 23         |
|                                                      | **11.3**   | ** ** | **No Other Warranties and Representations**               |       | 24         |
| ** **                                                | ** ** | ** ** | ** **                                                | ** ** | ** ** |
| ARTICLE XII CASUALTY AND CONDEMNATION                     |       | 25         |
|                                                      | **12.1**   | ** ** | **Uniform Vendor and Purchaser Act Not Applicable**       |       | 26         |
| ** **                                                | ** ** | ** ** | ** **                                                | ** ** | ** ** |
| ARTICLE XIII CONDUCT PRIOR TO CLOSING                     |       | 26         |
|                                                      | **13.1**   | ** ** | **Conduct**                                               |       | 26         |
|                                                      | **13.2**   | ** ** | **Actions Prohibited**                                    |       | 27         |
|                                                      | **13.3**   | ** ** | **Modification of Existing Leases and Service Contracts** |       | 28         |
|                                                      | **13.4**   | ** ** | **New Leases and Contracts**                              |       | 28         |
|                                                      | **13.5**   | ** ** | **Right to Cure**                                         |       | 28         |
| ** **                                                | ** ** | ** ** | ** **                                                | ** ** | ** ** |
| ARTICLE XIV OCCUPANCY CONTINGENCY                         |       | 28         |
|                                                      |       |       |                                                      |       |       |
| ARTICLE XV NOTICES                                        |       | 29         |
|                                                      |       |       |                                                      |       |       |
| ARTICLE XVI TRANSFER OF POSSESSION                        |       | 31         |
|                                                      | **16.1**   | ** ** | **Transfer of Possession**                                |       | 31         |
|                                                      | **16.2**   | ** ** | **Delivery of Documents at Closing**                      |       | 31         |
| ** **                                                | ** ** | ** ** | ** **                                                | ** ** | ** ** |
| ARTICLE XVII GENERAL PROVISIONS                           |       | 31         |
|                                                      | **17.1**   | ** ** | **Captions**                                              |       | 31         |
|                                                      | **17.2**   | ** ** | **Exhibits**                                              |       | 31         |

 

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| ** **                                     | **17.3**   | ** ** | **Entire Agreement**             |   | 31     |
|------------------------------------------------|------------|------------|----------------------------------|--------|--------|
| ** **                                     | **17.4**   | ** ** | **Modification**                 |   | 32     |
| ** **                                     | **17.5**   | ** ** | **Attorneys’ Fees**         |   | 32     |
| ** **                                     | **17.6**   | ** ** | **Governing Law**                |   | 32     |
| ** **                                     | **17.7**   | ** ** | **Time of Essence**              |   | 32     |
| ** **                                     | **17.8**   | ** ** | **Survival of Warranties**       |   | 32     |
| ** **                                     | **17.9**   | ** ** | **Assignment by Purchaser**      |   | 32     |
| ** **                                     | **17.10**  | ** ** | **Severability**                 |   | 33     |
| ** **                                     | **17.11**  | ** ** | **Successors and Assigns**       |   | 33     |
| ** **                                     | **17.12**  | ** ** | **Interpretation**               |   | 33     |
| ** **                                     | **17.13**  | ** ** | **Counterparts**                 |   | 33     |
| ** **                                     | **17.14**  | ** ** | **Recordation**                  |   | 33     |
| ** **                                     | **17.15**  | ** ** | **Limitation on Liability**      |   | 33     |
| ** **                                     | **17.16**  | ** ** | **Possession of Advisor**        |   | 34     |
| ** **                                     | **17.17**  | ** ** | **Business Day**                 |   | 34     |
| ** **                                     | **17.18**  | ** ** | **Waiver of Jury Trial**         |   | 34     |
| ** **                                     | ** ** | ** ** | ** **                       |   |   |
| ARTICLE XVIII ESCROW AGENT DUTIES AND DISPUTES |       | 34         |
| ** **                                     | **18.1**   | ** ** | **Other Duties of Escrow Agent** |   | 34     |
| ** **                                     | **18.2**   | ** ** | **Disputes**                     |   | 35     |
| ** **                                     | **18.3**   | ** ** | **Reports**                      |   | 35     |

 

**EXHIBITS**

 
| EXHIBIT A |   | — |   | Description of  Land                                          |
|----------------|--------|--------|--------|---------------------------------------------------------------|
| EXHIBIT B |   | — |   | Rent Roll                                                     |
| EXHIBIT C |   | — |   | Form of  Assignment of Leases and Contracts              |
| EXHIBIT D |   | — |   | Form of  Blanket Conveyance, Bill of Sale and Assignment |
| EXHIBIT E |   | — |   | Intentionally  Omitted                                        |
| EXHIBIT F |   | — |   | Service  Contracts                                            |
| EXHIBIT G |   | — |   | Form of  Notice to Tenants                               |
| EXHIBIT H |   | — |   | FIRPTA Affidavit                                              |
| EXHIBIT I      |   | — |   | Form of  Deed                                            |
| EXHIBIT J      |   | — |   | Personal  Property                                            |
| EXHIBIT K      |   | — |   | Due Diligence  Materials                                      |
| EXHIBIT L      |   | — |   | Lease Guidelines                                              |

 

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**INDEX OFDEFINED TERMS**

 
| **Term**                            | ** ** | **Section**   |
|-------------------------------------|------------|---------------|
|                                |       |          |
| Additional Funds                    |       | 2.1.2         |
| Advisor                             |       | 5.4           |
| Apartment  Development              |       | 1.1           |
| Assignment of  Escrow Accounts      |       | 4.2.9         |
| Assignment of  Leases and Contracts |       | 4.1.2         |
| Assumption  Documents               |       | 4.2.8         |
| Blanket  Conveyance                 |       | 4.1.3         |
| Closing                             |       | 6.1           |
| Code                                |       | 11.2.5        |
| Deed                                |       | 4.2.1         |
| Deposit                             |       | 2.1.1         |
| Due Diligence  Materials            |       | 5.4           |
| ERISA                               |       | 11.2.5        |
| Escrow Agent                        |       | Introduction  |
| Existing Survey                     |       | 5.1           |
| Final Closing  Date                 |       | 6.1           |
| Guarantor                           |       | 3.2.4         |
| Improvements                        |       | 1.2(a)        |
| Indemnitor                          |       | 3.2.4         |
| Inspection  Period                  |       | 5.6           |
| Intangibles                         |       | 1.2(e)        |
| Land                                |       | 1.2(a)        |
| Lender                              |       | 2.4           |
| Lender Consent                      |       | 2.4(e)        |
| Lender Consent  Notice              |       | 2.4(e)        |
| Leases                              |       | 1.2(c)        |
| Limitation  Period                  |       | 10.2          |
| Lists                               |       | 11.1.11(2)(a) |
| Loan                                |       | 2.4(a)        |
| Loan Assumption  Fee                |       | 7.2           |
| Loan Documents                      |       | 2.4(a)        |
| Maximum  Liability Cap              |       | 16.15         |
| Mortgage                            |       | 2.4(a)        |
| Note                                |       | 2.4(a)        |
| Occupancy  Condition                |       | Art. XV       |
| OFAC                                |       | 11.1.14       |
| Option  Consideration               |       | 2.5           |
| Order(s)                            |       | 11.1.14       |
| Original Lender                     |       | 2.4(a)        |
| Owner’s  Affidavit             |       | 4.2.10        |
| Permitted  Exceptions               |       | 5.3           |

 

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| Permitted  Outside Parties      |   | 5.9          |
|---------------------------------|--------|--------------|
| Personal  Property              |   | 1.2(b)       |
| Property                        |   | 1.2          |
| Property  Documents             |   | 5.9          |
| Purchase Price                  |   | 2.1          |
| Purchaser                       |   | Introduction |
| Purchaser’s  Action        |   | 10.1         |
| Purchaser  Assumption Documents |   | 4.1.6        |
| Real Property                   |   | 1.2(a)       |
| Rent Ready  Condition           |   | 13.1.4       |
| Rent Roll                       |   | 1.2(c)       |
| Seller                          |   | Introduction |
| Seller Assumption  Documents    |   | 4.2.8        |
| Seller Parties                  |   | 16.15        |
| Seller’s Broker            |   | 11.1.1       |
| Service  Contracts              |   | 1.2(d)       |
| Survey                          |   | 5.1          |
| Tenant Payments                 |   | 7.1.1        |
| Title Commitment                |   | 3.1.3(i)     |
| Title Company                   |   | 3.1.3        |
| Title Cure  Period              |   | 5.3          |
| Title Documents                 |   | 5.3          |
| Title Objections                |   | 5.3          |
| Title Policy                    |   | 3.1.3        |
| Title Report                    |   | 5.2          |
| Title Review  Period            |   | 5.3          |
| Underlying  Documents           |   | 3.1.3(i)     |

 

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**SALE,PURCHASE AND ESCROW AGREEMENT**

 

This Agreement, dated as of January 26, 2009, ismade by and between Verandah Owner Limited Partnership, a Delaware limitedpartnership (“**Seller**”), and Harvard PropertyTrust, LLC, a Delaware limited liability company (“**Purchaser**”)and constitutes (i) a contract of sale and purchase between theparties and (ii) an escrow agreement among Seller, Purchaser andPartners Title Company (“**Escrow Agent**”),the consent of which appears at the end hereof.

 

# **ARTICLE I**

# ** **

# **PURCHASE AND SALE**

# ** **

**1.1****                               Background**.  Selleris the owner of a 301-unit apartment development commonly known as The Verandahat Meyerland Apartments (the “**Apartment Development**”)located at 4620 N. Braeswood Avenue, Houston, Harris County, Texas.  Purchaser is willing to enter into a contractto buy the Apartment Development on the terms provided in this Agreement, andSeller has indicated that it is willing to enter into a contract to sell theApartment Development to Purchaser on the terms provided herein.

 

**1.2****                               Purchaseand Sale**.  Seller shall sell andconvey to Purchaser, and Purchaser shall buy from Seller, the Property (ashereinafter defined) for the consideration and upon and subject to the terms,provisions, and conditions of this Agreement. The “**Property**”means:

 

(a)                                  to the extent owned by Seller, the landsituated in Harris County, Texas, more particularly described in Exhibit A(the “**Land**”), together with: (i) theApartment Development and other improvements situated on the Land and all otherstructures, fixtures, buildings, and improvements situated on the Land (suchbuildings, structures, fixtures, and improvements being herein called the “**Improvements**”); (ii) any andall rights, titles, powers, privileges, easements, licenses, rights-of-way andinterests appurtenant to the Land and the Improvements; (iii) all rights,titles, powers, privileges, licenses, easements, rights-of-way, and interests,if any, of Seller, either at law or in equity, in possession or in expectancy,in and to any real estate lying in the streets, highways, roads, alleys,rights-of-way or sidewalks, open or proposed, in front of, above, over, under,through or adjoining the Land and in and to any strips or gores of real estateadjoining the Land; (iv) and all rights, titles, powers, privileges,interests, licenses, easements, and rights-of-way appurtenant or incident toany of the foregoing, including, without limitation, to the extent owned bySeller, all mineral, oil, gas and other hydrocarbon substances on and under andthat may be produced from the Land, as well as all development rights, land useentitlements, air rights, water, water rights, riparian rights, and water stockrelating to the Land (Land and Improvements being sometimes collectively hereinreferred to as the “**Real Property**”);

 

(b)                                 all equipment, fixtures, appliances,inventory, and other personal property of whatever kind or character owned bySeller and attached to or installed or located on or in the Land or theImprovements, including, without limitation, furniture, furnishings, 

 

1

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drapesand floor coverings, office equipment and supplies, heating, lighting,refrigeration, plumbing, ventilating, incinerating, cooking, laundry,communication, electrical, dishwashing, and air conditioning equipment,disposals, window screens, storm windows, recreational equipment, poolequipment, patio furniture, sprinklers, hoses, tools and lawn equipment (the “**Personal Property**”), a current listof the Personal Property being attached hereto as Exhibit J;

 

(c)                                  all right, title, and interest of Seller inand to all leases, rental agreements, licenses, and other similar arrangementspermitting occupancy or use by another of any apartment unit in theImprovements or any other space or area on the Land or in the Improvements, acurrent rent roll as of the date shown thereon being attached hereto as Exhibit B(the “**Rent Roll**”) (collectively, “**Leases**”), all guaranties of Leases,all rents, revenues, income, profits and receipts due under Leases or otherwisereceivable by the owner of the Property for use or occupancy of any of theProperty, and all security and other deposits and advance payments under Leases(subject to proration as provided in this Agreement);

 

(d)                                 all right, title, and interest of Seller inand to all contracts to which Seller is a party relating to the operation,maintenance, or management of the Property, including any agreements forelectric, gas, telephone, cable television, security alarm monitoring, sewer,trash collection or similar services, supply contracts, and brokerage andleasing agreements (collectively, the “**Service Contracts**”)to the extent that Service Contracts are assignable without consent, a currentlist of Service Contracts being attached hereto as Exhibit F, butspecifically excluding any contract with any affiliate of Seller (which shallbe terminated on or prior to the date of Closing (as hereinafter defined)) andspecifically excluding any contracts terminated by Seller pursuant to Section 5.6;

 

(e)                                  all right, title and interest of Seller inand to (i) all transferable permits, licenses, approvals, utility rights,development rights and similar rights related to the Property, if any, whethergranted by governmental authorities or private persons, to the extent that suchtransferable permits, licenses, approvals, utility rights, development rightsand similar rights are assignable without consent, (ii) all trademarks,trade names, or symbols under which the Land or the Improvements (or any partthereof) is operated including, without limitation, the name of “The Verandahat Meyerland” and the Internet domain name www.verandahmeyerland.com, (iii) alltelephone numbers serving the Apartment Development, (iv) all of theright, title, and interest in and to all site plans, surveys, soil andsubstrata studies, architectural drawings, plans and specifications,engineering plans and studies, floor plans, landscape plans and other plans orstudies of any kind that relate to the Land, the Improvements or the PersonalProperty in the possession of or under the control of Seller, and (v) allassignable warranties and *** ***guaranties covering all or anypart of the Property provided by any person and expressly including anywarranty or guaranty from an affiliate of Seller, if any, (collectively, the “**Intangibles**”), provided that anycost to assign or transfer any of the Intangibles shall be paid by Purchaser;and

 

2

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(f)                                    all other rights, privileges andappurtenances owned by Seller directly relating to the above-describedproperties.

 

# **ARTICLE II**

# ** **

# **PURCHASE PRICE**

# ** **

**2.1****                               Price**.  In consideration of the covenants hereincontained, Seller hereby agrees to sell and Purchaser hereby agrees to purchasethe Property for a total purchase price of TWENTY-NINE MILLION AND TWO-HUNDREDTHOUSAND DOLLARS ($29,200,000**)**(the “**Purchase Price**”), which shall bepaid by Purchaser as follows:

 

### **2.1.1****                     Deposit**.  Purchaser has delivered concurrently with itsexecution of this Agreement, or will deliver within two (2) business days,to Escrow Agent by bank wire of immediately available funds the sum of TWO-HUNDREDTHOUSAND****DOLLARS **(**$200,000)(the “**Deposit**”).

###  

### **2.1.2****                     Additionto Deposit**.  On or before theexpiration of the Investigation Period (as defined in Section 5.7),Purchaser shall deliver to Escrow Agent, by bank wire transfer of immediatelyavailable funds, an additional TWO-HUNDRED THOUSAND DOLLARS ($200,000) (the “**Additional Funds**”), unlessPurchaser shall have terminated this Agreement in accordance with Section 5.7.  The Additional Funds shall be deemed part ofthe Deposit, for an aggregate Deposit of four-hundred thousand Dollars($400,000).  If Purchaser fails todeliver the Additional Funds to Escrow Agent on or before the expiration of theInvestigation Period (provided Purchaser has not terminated this Agreement inaccordance with Section 5.7), such failure shall be a default underthis Agreement.

###  

### **2.1.3****                     Balanceof Purchase Price**.  Purchasershall, at least one (1) day before the Closing (as defined in Section 6.1),deliver to Escrow Agent, by bank wire transfer of immediately available funds,a sum equal to the balance of the Purchase Price, it being understood thatPurchaser shall receive a credit against the Purchase Price in the amount ofthe outstanding principal balance of the Loan (as described in Section 2.4below) as of the date of Closing which shall be $24,000,000, and whichPurchaser shall assume subject to the terms thereof at Closing.  The balance of the Purchase Price received bySeller at Closing shall be adjusted to reflect prorations and other adjustmentspursuant to Article VII.

###  

**2.2****                               Investments**.  Following the collection of the Deposit,Escrow Agent shall, at the direction of Purchaser, invest the Deposit in:

 

#### (i)                                     obligationsof the United States government, its agencies or independent departments;

####  

#### (ii)                                  certificatesof deposit issued by a banking institution whose principal office is in NewYork City or Houston with assets in excess of $1 billion; or

####  

#### 3

#### 

####  

#### (iii)                               an interest-bearingaccount of a banking institution whose principal office is in New York City orHouston with assets in excess of $1 billion.

####  

No investment of theDeposit shall have a maturity date beyond the Final Closing Date (as defined inSection 6.1).

 

**2.3****                               Intereston the Deposit**.  Any interestearned on the Deposit shall be credited and delivered to the party entitled toreceive the Deposit, provided, however, that if the transactioncloses, at Closing any interest earned on the Deposit shall be credited toPurchaser by applying the same against the Purchase Price.

 

**2.4****                               ExistingLoan**.  (a)  Seller hasadvised Purchaser that, as of the date of this Agreement, the Property isencumbered by a lien securing certain indebtedness (the “**Loan**”),which indebtedness is more particularly described in that certain Deed of Trustand Security Agreement given by Seller to Charles E. Odom, as trustee forDeutsche Banc Mortgage Capital, L.L.C., a Delaware limited liability company,as beneficiary (the “**Original Lender**”)dated as of August 11, 2006 and recorded on August 14, 2006 underClerk’s File No. Z524614 of the Official Public Records of Harris County,Texas, as assigned by Original Lender to Wells Fargo Bank, N.A. as trustee forthe Registered Holders of Banc of America Commercial Mortgage Inc., CommercialMortgage Pass-Through Certificates, Series 2006-4 (the **“Lender”**)****pursuant tothat certain Assignment of Deed of Trust and Security Agreement and Assignmentof Assignment of Leases and Rents by Original Lender in favor of Lender datedas of August 29, 2006 and recorded on December 29, 2006 under Clerk’sFile No. 20060294331 of the Official Public Records of Harris County,Texas (collectively, the “**Mortgage**”)and the Promissory Note in the original principal amount of $24,000,000 datedas of August 11, 2006 payable to Original Lender (the “**Note**” and together with theMortgage, collectively the “**Loan Documents**”).  Provided that Seller and Purchaser obtain theapproval of Lender as herein provided, Purchaser shall assume the Loan atClosing, subject to the terms and provisions of the Loan Documents.

 

(b)                                  Promptlyafter the execution of this Agreement and the delivery to Seller of suchinformation as is currently available to Purchaser to satisfy the requirementsof Lender with respect to a transfer of the Property, Seller shall deliver toLender a loan assumption request together with the applicable application feeset forth in the Loan Documents. Purchaser and Seller shall then use commercially reasonable efforts topursue the approval of Lender to the assignment and assumption of the Loan.Purchaser and Seller hereby agree to cooperate with the other in connectionwith the foregoing, including, without limitation, promptly furnishing allfinancial and other information reasonably required by Lender in connectionwith the foregoing, including without limitation any relating both to Purchaserand its partners or members, and otherwise satisfying Lender’s transferrequirements.

 

(c)                                   Purchaser shall have the right to contact Lender directly to discuss theLoan and the terms of any assumption thereof, provided Purchaser shall usecommercially reasonable efforts to advise Seller of all material matters(excluding confidential financial information) that Purchaser discusses withLender with respect to the assignment and assumption of the Loan.

 

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(d)                                  Inconnection with the assumption of the Loan, Purchaser shall be solelyresponsible for the payment of any and all Lender application fees, $50,000 ofthe Loan assumption fee and other Lender fees and expenses (including Lenderattorneys’ fees), including, without limitation, any portion thereof requiredto be paid at the time the request for consent is submitted to Lender, and anyrating agency fees, provided however that Seller shall be obligated to pay$190,000 of the one percent (1%) Loan assumption fee ($240,000) and all of itsexpenses in connection with obtaining Lender Consent, including its own attorneyfees.

 

(e)                                   Sellerand Purchaser shall use commercially reasonable efforts to obtain Lender’sagreement to the form of Loan Assumption and Consent Agreement in a form thatis satisfactory to Purchaser, Lender and Seller (the “**LenderConsent**”).  If Purchaserand Lender are unable to agree upon an acceptable form of assumption agreementwithin thirty (30) days after Purchaser is in receipt of draft loan assumptiondocuments from the Lender, Purchaser shall notify Seller in writing specifyingthe issues with respect to which Purchaser and Lender have failed to agree (the“**Lender Consent Notice**”).  Thereafter, Seller and/or Purchaser mayterminate this Agreement by written notice to the other delivered within five (5) businessdays after receipt of the Lender Consent Notice, in which event, theobligations of the parties hereunder shall be null and void and of no furtherforce and effect except those expressly stated to survive termination of thisAgreement and the Deposit shall be returned to Purchaser, within five (5) businessdays after receipt of the termination notice by the non-terminating party.

 

**2.5****                               OptionConsideration**.  Seller hereby acknowledges receipt of the sum of ONEHUNDRED AND NO/100 DOLLARS ($100.00) cash (the “**OptionConsideration**”) from Purchaser, as consideration for executionof this Agreement by Seller. If the purchase and sale of the Property isconsummated pursuant to this Agreement, the Option Consideration shall beapplied toward the cash portion of the Purchase Price paid by Purchaser. Ifthis Agreement is terminated pursuant to a default by Seller hereunder, theOption Consideration shall be immediately returned by Seller to Purchaser. Ifthis Agreement is terminated for any reason other than a default by Sellerhereunder, Seller shall be entitled to retain the Option Consideration.

 

# **ARTICLE III**

# ** **

# **CONDITIONS TO THE PARTIES’OBLIGATIONS**

# ** **

**3.1****                               Conditionsto Purchaser’s Obligation to Purchase**. Purchaser’s obligation to purchase is expressly conditioned upon each ofthe following:

 

### **3.1.1****                     Performanceby Seller**.  Performance in allmaterial respects of the obligations and covenants of, and deliveries requiredof, Seller hereunder.

###  

### **3.1.2****                     Deliveryof Title and Possession**. Delivery at the Closing of (i) all Closing documents as setforth in Section 4.2 hereof and (ii) possession asprovided in Section 17.1.

###  

### **3.1.3****                     TitleInsurance**.  Delivery at theClosing of the standard current form of Texas Land Title Association (TLTA)owner’s policy of title insurance (the “**Title**

###  

### 5

### 

###  

### **Policy**”),or an irrevocable commitment to issue the same,****withliability in the amount of the Purchase Price issued by Partners Title Companyas agent for Chicago Title Insurance Company (the “**TitleCompany**”), insuring that good and indefeasible fee title to theReal Property vests in Purchaser subject to the Permitted Exceptions (asdefined in Section 5.3) and the standard printed exceptions.

###  

#### (i)                                     Purchaserwill procure a commitment for title insurance issued by the Title Company (the “**Title Commitment**, and allsupporting encumbrance documents (the “**Underlying Documents**”).

####  

#### (ii)                                  Sellerwill pay via a closing adjustment the base premium for the basic cost of theTitle Policy not to exceed $91,577.00. At its option, Purchaser may direct the Title Company to issueadditional title insurance endorsements if Purchaser pays for the extra cost ofsuch additional endorsements, provided that the Title Company’s failure toissue any such additional endorsements shall not affect Purchaser’s obligationsunder this Agreement.

####  

### **3.1.4****                     Seller’sRepresentations**.  Therepresentations and warranties by Seller set forth in Section 11.1being true and correct in all material respects as of the Closing except asmodified by notice (in accordance with Section 11.1) to whichPurchaser does not object in writing by the later of (i) threebusiness days after receipt thereof or (ii) the end of theInvestigation Period.

###  

### **3.1.5****                     LoanAssumption**.  Lender’s willingnessto execute and deliver Lender’s Consent .

###  

**3.2****                               Conditionsto Seller’s Obligation to Sell**. Seller’s obligation to sell is expressly conditioned upon each of thefollowing:

 

### **3.2.1****                     Performanceby Purchaser**.  Performance in allmaterial respects of the obligations and covenants of, and deliveries requiredof, Purchaser hereunder.

###  

### **3.2.2****                     Receiptof Purchase Price**.  Receipt ofthe Purchase Price and any adjustments due Seller under Article VIIat the Closing in the manner herein provided.

###  

### **3.2.3****                     LoanAssumption**.  Purchaser’sassumption of the Loan in accordance with Section 2.4 hereof andPurchaser’s satisfaction of all conditions required by Lender in connectiontherewith.

###  

### **3.2.4****                     Release.**Release of all indemnities from Harry Bookey (the “**Guarantor**”)and Seller (collectively, the “**Indemnitor**”)with respect to that certain Environmental Indemnity Agreement dated August 11,2006, by Indemnitor in favor of Original Lender, and the release of Guarantorfrom obligations and liability under the Guaranty and Indemnity dated as of August 11,2006, by Guarantor in favor of Original Lender. In addition, Seller’s obligation to sell is conditioned upon Seller’sreceipt from Lender of a release of all of Seller’s obligations under the LoanDocuments accruing on and after the Closing.

###  

### 6

### 

# ** **

# **ARTICLE IV**

# ** **

# **PURCHASER’S DELIVERIESAND SELLER’S DELIVERIES TO ESCROW AGENT**

# ** **

**4.1****                               Purchaser’sDeliveries**.  Purchaser shall, ator before the Closing, deliver to Escrow Agent each of the following:

 

### **4.1.1****                     PurchasePrice**.  The balance of thePurchase Price as set forth in Article II.

###  

### **4.1.2****                     Assignmentof Leases and Contracts**.  Four (4) executedcounterparts of the Assignment and Assumption of Leases, Contracts and OtherProperty Interests (the “**Assignment of Leases andContracts**”) in the form of Exhibit C.

###  

### **4.1.3****                     BlanketConveyance, Bill of Sale and Assignment**.  Four (4) executed counterparts of ablanket conveyance, bill of sale, and assignment (the “**BlanketConveyance**”) in the form of Exhibit D.

###  

### **4.1.4****                     ClosingStatement**.  An executedsettlement statement reflecting the prorations and adjustments required under Article VII.

###  

### **4.1.5****                     Cash– Prorations**.  The amount, ifany, required of Purchaser under Article VII.

###  

### **4.1.6****                     LoanAssumption**.  Such documents asmay reasonably be required by Lender to be executed or delivered by Purchaserin connection with the assumption by Purchaser of the Loan (the “**Purchaser Assumption Documents**”).

###  

**4.2****                               Seller’sDeliveries**.  Seller shall, at orbefore the Closing, deliver to Escrow Agent each of the following:

 

### **4.2.1****                     Deed**.  A special warranty deed (the “**Deed**”) in the form of Exhibit Iwith respect to the Real Property, executed and acknowledged by Seller,pursuant to which Seller shall convey title to the Real Property subject to thePermitted Exceptions as defined in Section 5.3 hereof.

###  

### **4.2.2****                     Assignmentof Leases and Contracts**.  Four (4) executedcounterparts of the Assignment of Leases and Contracts in the form of Exhibit C,and (whether through the closing escrow or through such other method ofdelivery as the parties may establish) original executed Leases (or copies iforiginals are not in Seller’s possession) and the Service Contracts which areto be assumed hereunder pursuant to Section 5.6 hereof.

###  

### **4.2.3****                     BlanketConveyance, Bill of Sale and Assignment**.  Four (4) executed counterparts of theBlanket Conveyance.

###  

### **4.2.4****                     Noticesto Tenants**.  A notice signed bySeller (or Seller’s manager for the Improvements) addressed to the tenantsunder the Leases in the form of Exhibit G.

###  

### 7

### 

###  

### **4.2.5****                     FIRPTAAffidavit**.  Four (4) executedcopies of an affidavit in the form of Exhibit H with respect to theForeign Investment in Real Property Tax Act.

###  

### **4.2.6****                     ClosingStatement**.  An executedsettlement statement reflecting the prorations and adjustments required under Article VII.

###  

### **4.2.7****                     Cash– Prorations**.  The amount, ifany, required of Seller under Article VII.

###  

### **4.2.8****                     LoanAssumption**.  Such documents asmay reasonably be required by Lender to be executed or delivered by Seller inconnection with the assumption by Purchaser of the Loan (the “**Seller Assumption Documents**,”together with the Purchaser Assumption Documents, the “**AssumptionDocuments**”).

###  

### **4.2.9****                     Assignmentof Deed of Trust Escrow Accounts**. Four (4) executed counterparts of the Assignment of Deed of TrustEscrow Accounts (the “**Assignment of EscrowAccounts**”).

###  

### **4.2.10****              Owner’sAffidavit**.  A customary owner’s affidavit (the “**Owner’s Affidavit**”) in a formreasonably satisfactory to the Title Company certifying to the Title Companythat there are no unpaid bills or claims relating to the Property as of thedate of Closing except as specified, and whatever documentation may bereasonably requested or required in order to confirm the proper authority ofSeller to consummate this transaction and to issue the Title Policy.

###  

**4.3****                               Failureto Deliver**.  The failure ofPurchaser or Seller to make any delivery required above by and in accordancewith this Article IV which is not waived by the other party shallconstitute a default hereunder by Purchaser or Seller, as applicable.

 

# **ARTICLE V**

# ** **

# **INVESTIGATION OF PROPERTY**

# ** **

**5.1****                               Survey**.  Seller has, in accordance with Section 5.6below and as one of the Due Diligence Materials (as defined therein), deliveredto Purchaser an existing survey of the Land and Improvements prepared by TerraSurveying Co., Inc. (the “**Existing Survey**”).  Within the Title Review Period (hereinafterdefined), Purchaser, using commercially reasonable efforts, and at its soleexpense, shall cause to be delivered to Seller and Title Company a current platof an “as-built” “update” of the Existing Survey in form acceptable toPurchaser (the “**Survey**”),and a field note description thereof, prepared and certified as to all mattersshown thereon by a licensed professional engineer or surveyor acceptable to theTitle Company and in such form and substance sufficient to permit deletion fromthe Title Policy of the survey exception except for “shortages in area”.

 

**5.2****                               IntentionallyDeleted**.

 

**5.3****                               Reviewof Survey and Title**.  Purchaser shall have a period (the “**Title Review****Period**”) ending at 5 p.m. Central Standard Timefifteen (15) days after the Effective Date within 

 

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whichto review the Survey, the Title Commitment, and the Underlying Documents(collectively, “**Title Documents**”)and give Seller written notice of its objection to the condition of titlereflected by the Title Documents (the “**Title Objections**”).With regard to any objection so made by Purchaser, Seller shall reasonablycooperate with Purchaser to remedy such objection, but Seller shall not beobligated to pay any sum of money or to incur any obligation or liability toany third party as any inducement to remove an objection to title other than (i) avoluntary lien against the Property recorded subsequent to the date of theTitle Commitment and consented to by Seller, or (ii) any mechanic’s ormaterialman’s lien arising from work contracted for by Seller.  If Seller does not cure such objections oragree in writing to cure such objections within ten (10) days afterreceipt of Purchaser’s written objections (the “**TitleCure Period**”), Purchaser may, at its option, (i) waive suchuncured objections and accept such title as Seller can deliver, or (ii) terminatethis Agreement by notice in writing delivered to Seller within five (5) businessdays after the end of the Title Cure Period and receive back the Deposit.  In such event, if no termination notice isgiven under (ii) above, Purchaser shall be deemed to have waived suchuncured objections and shall accept such title as Seller can deliver.  In the event of such termination, neitherparty shall have any further rights or obligations under this Agreement exceptfor those that expressly survive the termination hereof.  In the event Purchaser fails to furnishSeller, on or before the end of the Title Review Period, either written noticethat the Survey, the Title Report, and the Underlying Documents aresatisfactory, or written notice of Purchaser objections to the Survey, theTitle Report, and/or the Underlying Documents, Purchaser shall be deemed tohave waived any objection to the Survey, Title Report, and the UnderlyingDocuments and shall accept such title as Seller can deliver.  In any event, any title matters that Seller does notexpressly agree in writing to cure by written notice to Purchaser or thatSeller is not expressly obligated to cure as provided above and that the TitleCompany does not agree to remove shall be “Permitted Exceptions” and deemedwaived by Purchaser if Purchaser does not elect to terminate this Agreementprior to the expiration of the Title Cure Period.  The term “**PermittedExceptions**” shall mean: the specific exceptions in the TitleReport that the Title Company has not agreed to remove from the Title Report asof the end of the Title Cure Period and that Seller is not required to removeas provided above; any other lien, encumbrance, easement or other exception ormatter voluntarily imposed or consented to by Purchaser prior to or as of theClosing or matters created by, through or under Purchaser; items shown on theSurvey which have not been removed as of the end of the Title Cure Period; realestate taxes not yet due and payable; rights of tenants under the Leases andany other leases executed in accordance with this Agreement after the datehereof, and the rights of tenants thereunder; rights of tenants or licenseesunder Service Contracts not terminated as of Closing; all exceptions (includingprinted exceptions) to title contained or disclosed in the Title Commitment otherthan Title Objections identified and not thereafter waived by Purchaser; allmatters, rights and interests that would be discovered by an inspection orsurvey of the Property; and the deed of trust and any other securityinstruments securing or evidencing the Loan.

 

**5.4****                               Inspectionof Property**.  Seller, at itsexpense, shall deliver or make available to Purchaser copies of all materialdocuments on the attached list attached hereto as Exhibit K, inaddition to materials and documents previously delivered to Purchaser (together, the “**DueDiligence Materials**”) Purchaser and its agents and dulyauthorized representatives shall have the right to inspect the condition of theLand, Improvements and Personal Property and the books and records of Sellerpertaining thereto during reasonable business hours.  Seller hereby agrees 

 

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togive Purchaser its reasonable cooperation in connection with such inspections,provided that (i) Purchaser must give Seller twenty-four (24) hours’prior telephone or written notice of any such inspection or test, and withrespect to any intrusive inspection or test (*i.e.*,core sampling) must obtain Seller’s prior written consent (which consent may begiven, withheld or conditioned in Seller’s sole discretion), (ii) prior toperforming any inspection or test, Purchaser must deliver a certificate ofinsurance to Seller evidencing that Purchaser and its contractors, agents andrepresentatives have in place not less than $1,000,000 of comprehensive generalliability insurance (including a contractual liability endorsement insuringPurchaser’s indemnity obligation under this Agreement) covering any accident ordamage arising in connection with the presence of Purchaser, its contractors,agents and representatives on the Property, which insurance shall name Sellerand BlackRock Realty Advisors, Inc. (“**Advisor**”)as additional insureds thereunder, issued by a licensed company qualified to dobusiness in the State in which the Property is located, and (iii) all suchtests shall be conducted by Purchaser in compliance with Purchaser’sresponsibilities set forth in Section 5.9 below.  Purchaser shall bear the cost of all suchinspections or tests.

 

**5.5****                               OperationalInformation**.  In addition, Seller agrees specifically toprovide upon request of Purchaser or make available to Purchaser (in Seller’soffices or at the management office of Seller’s local property manager or atthe Property), to the extent in Seller’s possession or control and to the extentnot previously delivered under Section 5.4 above or made availableto Purchaser under Section 5.4 above, the following:

 

### **5.5.1****                     Leasesand Contracts**.  Copies of theLeases and the Contracts.

###  

### **5.5.2****                     Plansand Specifications**.  To theextent in Seller’s possession, copies of all plans and specifications for theImprovements.

###  

### **5.5.3****                     Reports**.  To the extent in Seller’s possession, copiesof all environmental reports prepared by third parties.

###  

### **5.5.4****                     Permits**.  To the extent in Seller’s possession, copiesof all governmental permits, certificates of occupancy and approvals, in eachcase regarding the Property.

###  

### **5.5.5****                     LoanDocuments**.  Copies of the LoanDocuments.

###  

### **5.5.6****                     Other**.  Such additional customary documentation andinstruments as Purchaser may reasonably request.

###  

  If Purchaser terminates this Agreement as setforth in Section 5.6 below, then the Due Diligence Materials andall other information, documents and materials furnished by Seller to Purchasershall be returned promptly to Seller (which obligation shall survive thetermination of this Agreement).  Purchaseragrees that, in the exercise of the right of access granted hereby, it will notunreasonably interfere with or permit unreasonable interference with any personoccupying or providing service at the Property. Purchaser agrees that it or its agents will not communicate with anytenants without the consent of Seller.

 

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**5.6****                               NoObligation to Cure**.  Nothing contained in this Agreement orotherwise shall require Seller to render its title marketable or to remove orcorrect any exception or matter disapproved by Purchaser or to spend any moneyor incur any expense in order to do so except as set forth in Section 5.3hereof.

 

**5.7****                               InspectionPeriod**.  Purchaser shall have until 5 p.m.Central Standard Time on February 20, 2009 (“**InspectionPeriod**”) within which to review, examine, inspect, test andsatisfy itself as to the condition of the Land, Improvements and PersonalProperty and the operational information relating thereto. In the event thatsuch inspection indicates that the Property is not satisfactory to Purchaser,in Purchaser’s sole and absolute discretion, Purchaser may terminate thisAgreement by notice in writing delivered to Seller prior to the expiration ofthe Inspection Period, in which event the Deposit will be returned toPurchaser, and neither party shall have any further right or obligationhereunder other than as set forth herein with respect to rights or obligationswhich survive termination.  If thisAgreement is not terminated by written notice to Seller in the manner andwithin the time provided in this Section 5.7, Purchaser’s right toterminate this Agreement pursuant to this Section 5.7 and any andall objections with respect to the Inspection Period will be deemed to havebeen waived by Purchaser for all purposes. Except as provided below, Seller shall cause all Service Contracts to beterminated effective as of or prior to the date of Closing, provided that (i) Sellershall have no obligation to assign or terminate, and Purchaser shall beobligated to assume, any Service Contracts which by their terms cannot beassigned or  terminated without penalty orpayment of a fee and (ii) Seller shall not terminate any Service Contractswhich Purchaser notifies Seller in writing prior to the expiration of theInspection Period that it desires to assume. At Closing Seller shall assign and Purchaser must assume the obligationsarising from and after the Closing Date under those Service Contracts thatPurchaser is obligated or desires to assume pursuant to this Section 5.7.

 

**5.8****                               Rightto Audit**.  AtPurchaser’s request, at any time before Closing or within one (1) yearafter Closing, and without material cost or expense to Seller, Seller shallprovide to Purchaser’s designated independent auditor reasonable access to thebooks and records of the Property to the extent in Seller’s possession, and allrelated information in Seller’s possession regarding the period for whichPurchaser is required to have the Property audited under the regulations of theSecurities and Exchange Commission,****Purchaseragrees to indemnify and hold harmless Seller from any claim, damage, loss, orliability to which Seller is at any time subjected by any person who is not aparty to this Agreement as a result of Seller’s compliance with this paragraph,except to the extent any such claim, damage, loss or liability arises fromSeller’s fraud or intentional misrepresentation, which indemnification shallsurvive the Closing or earlier termination of this Agreement.

 

**5.9****                               ProprietaryDocuments; Confidentiality**.  Purchaser acknowledges that the documents andinformation provided or made available to Purchaser pursuant to this Agreement,including without limitation the documents and information described in Sections5.4 and 5.5 above (collectively, the “**Property Documents**”)are proprietary and confidential and will be delivered to Purchaser solely toassist Purchaser in determining the feasibility of purchasing theProperty.  Purchaser shall not use theProperty Documents for any purpose other than as set forth in the precedingsentence.  Purchaser shall not disclosethe contents to any person other than to those persons who are responsible fordetermining the feasibility of Purchaser’s acquisition of the Property and whohave agreed to preserve the confidentiality of such information as required 

 

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hereby(collectively, “**Permitted Outside Parties**”);provided, however, Purchaser shall disclose only such information to aparticular Permitted Outside Party as is reasonably necessary for thatPermitted Outside Party to perform its role in assisting Purchaser to determinethe feasibility of its acquisition of the Property, and nothing more. Purchasershall not divulge the contents of the Property Documents and other informationexcept in strict accordance with the confidentiality standards set forth in thisSection 5.9.  In permittingPurchaser to review the Property Documents or any other information, Seller hasnot waived any privilege or claim of confidentiality with respect thereto, andno third party benefits or relationships of any kind, either express orimplied, have been offered, intended or created.  Purchaser shall not at any time issue a pressrelease or otherwise communicate with media representatives regarding this saleand purchase unless such release or communication occurs after the Closing, butin no event shall such press release or media communication include informationregarding the Purchase Price.  Purchasershall promptly deliver all Property Documents to Seller in the event that the  Closing does not occur.  This Section 5.9 shall survivethe Closing or termination of this Agreement.

 

**5.10****                        Purchaser’sResponsibilities**.  In conducting any inspections, investigationsor tests of the Property and/or Property Documents, Purchaser and its agentsand representatives shall:  (i) notdisturb the tenants or interfere with their use of the Property pursuant totheir respective Leases; (ii) not interfere with the operation andmaintenance of the Property; (iii) not damage any part of the Property orany personal property owned or held by any tenant or any third party; (iv) notinjure or otherwise cause bodily harm to Seller or its agents, guests,invitees, contractors and employees or any tenants or their guests or invitees;(v) comply with all applicable laws; (vi) promptly pay when due thecosts of all tests, investigations, and examinations done with regard to theProperty; (vii) allow Seller to have a representative present during anysuch inspection or test; (viii) cooperate with any reasonable request bySeller in connection with the timing of any such inspection or test; (ix) provideSeller, upon Seller’s request, with a copy of any written inspection or testreport or summary prepared by any third party; (x) not permit any liens toattach to the Property by reason of the exercise of its rights hereunder;(xi) not reveal or disclose prior to Closing any information obtainedduring the Inspection Period concerning the Property and the Property Documentsto anyone other than the Permitted Outside Parties, in accordance with theconfidentiality standards set forth in Section 5.9 above, or exceptas may be otherwise required by law. Purchaser agrees at its own expense to promptly repair or restore theProperty, if any inspection or test requires or results in any damage to oralteration of the condition of the Property, and that the obligations set forthin this sentence shall survive the Closing or any termination of thisAgreement.

 

**5.11****                        Purchaser’sAgreement to Indemnify**.  Purchaser hereby agrees to indemnify, defendand hold harmless Seller, Advisor, and their affiliates, members, partners,subsidiaries, shareholders, officers, directors and agents from and against anyand all liens, claims, causes of action, damages, liabilities, losses,injuries, costs, and expenses (including reasonable attorneys’ fees and costs)arising out of inspections or tests by Purchaser or its employees, consultants,agents or representatives permitted under this Agreement ; provided, however,the indemnity shall not extend to protect Seller from any pre-existing liabilitiesfor matters merely discovered by Purchaser (*i.e.*,latent environmental contamination) so long as Purchaser’s actions do notaggravate any pre-existing liability of Seller. Furthermore, Purchaser shall be liable only for direct damages, and notincidental, consequential or punitive damages (except to the extent 

 

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Seller is liable to thirdparties for such incidental, consequential or punitive damages for whichPurchaser shall provide indemnity) and Purchaser shall not be liable for claimsto the extent arising in whole or in part from the negligence of Seller, itsagents, independent contractors, servants and/or employees.  Purchaser’s obligations under this Section 5.11shall survive the termination of this Agreement and shall survive the Closing.

 

# **ARTICLE VI**

 

# **THE CLOSING**

 

**6.1****                               Dateand Manner of Closing**.  Escrow Agent shall close the escrow (the “**Closing**”) as soon as all conditionsto closing contained in this Agreement have been satisfied (or deemed satisfied)or waived in writing which shall in any event be not later than 12:00 noonCentral Standard Time on the date that is ten (10) days after the later of(i) the expiration of the Investigation Period or (ii) Lender’sconfirmation of its willingness to immediately execute and deliver the LenderConsent (the “**Final Closing Date**”), andthereafter recording and delivering all documents and funds as set forth in Article VIII.  Notwithstanding anything herein to thecontrary, the Final Closing Date shall occur on or before May 1, 2009,after which date either party shall have the right to terminate this Agreementby written notice to the other, in which event the Deposit shall be returned tothe Purchaser.

 

# **ARTICLE VII**

 

# **PRORATION, FEES, COSTSAND ADJUSTMENTS**

 

**7.1****                               Prorations**.  Prior tothe Closing, Seller and Purchaser shall determine the amounts of the prorationsin accordance with this Agreement within no less than two (2) days priorto Closing.  Purchaser shall review andapprove such determination promptly and prior to the Closing, such approval notto be unreasonably withheld or delayed. Thereafter, Purchaser and Seller shall each inform Escrow Agent of suchamounts.

 

### **7.1.1****                     CertainItems Prorated**.  In accordancewith the notifications, Escrow Agent shall prorate between the parties (and theparties shall deposit funds therefor with Escrow Agent or shall instruct EscrowAgent to debit against sums held by Escrow Agent owing to such party), as of11:59 p.m. the day prior to the Closing, all income and operating expenseswith respect to the Property and payable to or by the owner of the Property,including, without limitation:  (i) allreal property and personal property taxes and assessments on the basis of thefiscal period for which assessed (if the Closing shall occur before the taxrate is fixed, the apportionment of taxes shall be based on the tax rate forthe preceding period applied to the latest assessed valuation****and after the Closing, when the actual real property andpersonal property taxes are finally fixed, Seller and Purchaser shall promptlymake a recalculation of such proration, and the appropriate party shall makethe applicable payment reflecting the recalculation to the other party); (ii) rentsand other tenant payments and tenant reimbursements, if any (collectively, “**Tenant Payments**”), received andcollected under the Leases; (iii) charges for water, sewer,electricity, gas, fuel and other utility charges, all of which shall be readpromptly 

 

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### beforeClosing, unless Seller elects to close its own applicable account, in whichevent Purchaser shall open its own account and the respective charges shall notbe prorated; (iv) amounts prepaid and amounts accrued but unpaid onService Contracts which are to be assumed by Purchaser under the terms hereof;and (v) periodic fees for licenses, permits or otherauthorizations, if any, with respect to the Property.  If such charges, expenses and income areunavailable at the Closing, a readjustment shall be made within thirty (30)days after the Closing of these items.

###  

### **7.1.2****                     LeasingCommissions**.  At the Closing,Purchaser and Seller shall prorate, based on the portion of the term of theapplicable Lease occurring before and after the Closing, all leasingcommissions entered into after the end of the Investigation Period, any renewalor extension of an existing Lease after such date and any new lease referred toin Section 13.4.

###  

### **7.1.3****                     Taxes**.

 

###### (a)                                  Realproperty tax refunds and credits received after the Closing which areattributable to a fiscal tax year prior to the year of Closing shall belong toSeller.  Any such refunds and creditsattributable to the fiscal tax year during which the Closing occurs shall beapportioned between Seller and Purchaser after deducting the reasonableout-of-pocket expenses of collection thereof. This apportionment obligation shall survive the Closing.

######  

###### (b)                                 Ifany tax appeal or certiorari proceedings shall not have been finally resolvedor settled prior to the Closing and shall relate to the year 2008 or a prioryear, Seller, at its sole cost and expense, shall be entitled to control thedisposition of any such tax appeal or certiorari proceeding and shall beentitled to any refunds received therefrom. With respect to the 2009 tax year, Purchaser shall be entitled tocontrol any tax protest and any refunds received therefrom, net of any expensesincurred by Purchaser in connection therewith, shall be prorated between theparties on the basis of the portions accruing to periods before and after theClosing.

######  

###### (c)                                  Paymentof rollback taxes that are the result of the change of Purchaser’s use of theproperty after Closing that result in the assessment of additional taxes,penalties or interest (assessment) for periods before Closing shall be theresponsibility of Purchaser

######  

### **7.1.4****                     Securityand Other Deposits**.  At theClosing, Seller shall deliver to Purchaser all unapplied refundable securityand pet deposits (plus interest accrued thereon to the extent required to bepaid by the applicable Leases or applicable laws) required to be held by Sellerunder the Leases and Purchaser shall pay Seller an amount equal to all utilityand contract deposits then held by third parties with respect to the Propertyand transferred to Purchaser hereunder.

 

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### **7.1.5****                     Adjustments**.

 

###### (a)                                  With respect to delinquent rentals and anyother rentals not collected as of the Closing (and thus not prorated as ofClosing), Purchaser shall make a commercially reasonable and customary attemptto collect the same for Seller’s benefit after the Closing and such collection,if any, shall be remitted to Seller promptly upon receipt by Purchaser. Nothingcontained herein shall operate to require Purchaser to institute any lawsuit orother legal collection procedure to collect such delinquent rentals. Purchaserand Seller agree that any sums received by Purchaser from any tenants afterClosing shall be applied (i) first to rentals due for the monthduring which the Closing occurs (and said rentals shall be allocated betweenSeller and Purchaser as if same had been prorated at Closing, with the amountdue Seller to be paid to Seller promptly upon receipt by Purchaser), (ii) second,to current rentals due after the monthin which the Closing occurs, (iii) third, to delinquent rentals owed withrespect to the period after the month in which the Closing occurs, and (iv) fourth,to delinquent rentals owed with respect to the period prior to Closing,regardless of the designation of such sums by the tenant. In addition toPurchaser’s agreement set forth above to pursue delinquent rents for thebenefit of Seller, Seller shall have the right to pursue collection ofdelinquent rents, but Seller agrees that it will initiate no suit or legal proceedingto collect delinquent rents from a tenant so long as they remain a tenant ofthe Property.

 

###### (b)                                 Sellershall receive a credit for the amount of all reserve escrow accounts under theLoan to be assigned to Purchaser at the Closing.

 

###### (c)                                  Purchasershall not receive a credit at the Closing for its prorated portion of any bonusor other up front payment previously made and received by Seller under or inconnection with any Service Contract, including, without limitation, laundryroom leases, security system, internet, satellite and cable TV leases orcontracts entered into prior to Closing.

 

### **7.1.6****                     Insurance**.  Seller’s existing liability and propertyinsurance pertaining to the Property shall be canceled as of the Closing, andSeller shall receive any premium refund due thereon.

 

### **7.1.7****                     LoanEscrows and Interest**.  In theevent Lender retains any tax, insurance or other escrow amount (including anyamounts which have been funded but held back) and are assigned to Purchaserpursuant to the Assignment of Escrow Account, the amounts thereof shall be paidto Seller at Closing.  Any accrued andunpaid interest on the Loan shall be credited against the Purchase Price.  Seller shall notify Purchaser of suchamounts, if any, no later than five (5) days prior to the Closing.

 

### **7.1.8****                     Survival**.  The provisions of this Article VIIshall survive the Closing of this transaction and the payment of anyconsideration and the delivery of all closing instruments.

 

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**7.2****                               Seller’sClosing Costs**.**** Seller shall pay (i) one-half of Escrow Agent’s escrow fee or escrow termination charge, (ii) thecost of any update to the Existing Survey of the Property, (iii) $91,577 towards the cost of the base TitlePolicy, (iv) all brokerage fees, (v) $190,000 ofthe one percent (1%) loan assumption fee of $240,000 (the “**LoanAssumption Fee**”), and (vi) Seller’s own attorneys’fees.  In addition, Seller shall beresponsible for any sales or use taxes imposed, if any, resulting from thistransaction.

 

**7.3****                               Purchaser’sClosing Costs**.   Purchaser shall pay (i) anydocumentary stamp or transfer tax, (ii) one-half of Escrow Agent’sescrow fee or escrow termination charge, (iii) the cost of anyother title insurance endorsements ordered by Purchaser and any difference inprice between the base title premium for the base Title Policy and $91,577, (iv) anycosts incurred in recording the Deed or any other instruments, (v) anycosts incurred in connection with Purchaser’s investigation of the Propertypursuant to Article V, including the cost of any new environmentalassessment commissioned by Purchaser, (vi) all costs and expensesof Lender in connection with obtaining Lender Consent as described in Section 2.4(d) hereof,any rating agency fees and $50,000 of the Loan Assumption Fee, and (vii) Purchaser’sown attorneys’ fees.

 

# **ARTICLE VIII**

 

# **DISTRIBUTION OF FUNDS ANDDOCUMENTS**

 

**8.1****                               Deliveryof the Purchase Price**.  At the Closing, Escrow Agent shall deliverthe Purchase Price to Seller, and the transaction shall not be consideredclosed until such delivery occurs.

 

**8.2****                               OtherMonetary Disbursements**.  Escrow Agent shall, at the Closing, hold forpersonal pickup or arrange for wire transfer, (i) to Seller, ororder, as instructed by Seller, all sums and any proration or other credits towhich Seller is entitled and less any appropriate proration or other chargesand (ii) to Purchaser, or order, any excess funds thereforedelivered to Escrow Agent by Purchaser and all sums and any proration or othercredits to which Purchaser is entitled and less any appropriate proration orother charges.

 

**8.3****                               RecordedDocuments**.  Escrow Agent shall cause the Deed and anyother documents that Seller or Purchaser desires to record to be recorded withthe appropriate county recorder and, after recording, returned to the grantee,beneficiary or person acquiring rights under said document or for whose benefitsaid document was required.

 

**8.4****                               Documentsto Purchaser**.  Escrow Agent shall at the Closing deliver byovernight express delivery to Purchaser the following:

 

##### (1)                                  oneconformed copy of the Deed showing all recording data;

##### (2)                                  twooriginals of the Assignment of Leases and Contracts;

##### (3)                                  twooriginals of the Blanket Conveyance;

##### (4)                                  twooriginals of the Assignment of Escrow Accounts;

##### (5)                                  oneoriginal of the Notice to Tenants;

##### (6)                                  twooriginals of the FIRPTA Affidavit;

##### (7)                                  oneoriginal of the Closing Statement;

 

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##### (8)                                  oneoriginal of all Assumption Documents;

##### (9)                                  oneoriginal of the Title Policy; and

(10)                            oneoriginal of any Owner Affidavit.

 

**8.5****                               Documentsto Seller**.  Escrow Agent shall at the Closing deliver byovernight express delivery to Seller, the following:

 

##### (1)                                  oneconformed copy of the Deed showing all recording data;

##### (2)                                  twooriginals of the Assignment of Leases and Contracts;

##### (3)                                  twooriginals of the Blanket Conveyance;

##### (4)                                  twooriginals of the Assignment of Escrow Accounts;

##### (5)                                  onecopy of the Notice to Tenants;

##### (6)                                  twooriginals of the FIRPTA Affidavit;

##### (7)                                  oneoriginal of the Closing Statement;

##### (8)                                  onecopy of all Assumption Documents;

##### (9)                                  onecopy of the Title Policy; and

##### (10)                            onecopy of any Owner Affidavit.

 

**8.6****                               AllOther Documents**.  Escrow Agent shall at the Closing deliver byovernight express delivery, each other document received hereunder by EscrowAgent to the person acquiring rights under said document or for whose benefitsaid document was required.

 

# **ARTICLE IX**

 

# **RETURN OF DOCUMENTS ANDFUNDS UPON TERMINATION**

 

**9.1****                               Returnof Seller’s Documents**.  If escrow or this Agreement is terminated byPurchaser for any reason, Purchaser shall, within five (5) daysfollowing such termination, deliver to Seller all documents and materialsrelating to the Property previously delivered to Purchaser by Seller and copiesof all reports and studies obtained by Purchaser from third parties inconnection with the Property and Purchaser’s investigation thereof.  Such items shall be delivered withoutrepresentation or warranty as to accuracy or completeness and with no right ofSeller to rely thereon without the consent of the third party.  Escrow Agent shall deliver all documents andmaterials deposited by Seller and then in Escrow Agent’s possession to Sellerand shall destroy any documents executed by both Purchaser and Seller.  Upon delivery by Escrow Agent to Seller (orsuch destruction, as applicable) of such documents and materials, Escrow Agent’sobligations with regard to such documents and materials under this Agreementshall be deemed fulfilled and Escrow Agent shall have no further liability withregard to such documents and materials to either Seller or Purchaser.

 

**9.2****                               Returnof Purchaser’s Documents**.  If escrow or this Agreement is terminated bySeller for any reason, Escrow Agent shall deliver all documents and materialsdeposited by Purchaser and then in Escrow Agent’s possession to Purchaser andshall destroy any documents executed by both Purchaser and Seller. Upondelivery by Escrow Agent to Purchaser (or such destruction, as applicable) ofsuch documents and materials, Escrow Agent’s obligations with regard to suchdocuments and materials under this Agreement shall be deemed fulfilled and 

 

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Escrow Agent shallhave no further liability with regard to such documents and materials to eitherSeller or Purchaser.

 

**9.3****                               Deposit**.  Ifescrow or this Agreement is terminated (i) pursuant to Section 2.4(e),Section 5.7, Section 10.2,Article XII, or Article XIV,or (ii) due to the failure of a condition set forth in Section 3.1,then Purchaser shall be entitled to obtain the return of the Deposit pursuantto Section 9.4 below.  If theClosing does not take place and escrow or this Agreement is terminated for anyother reason, Seller shall be entitled to the Deposit by retaining or causingEscrow Agent to deliver the Deposit to Seller pursuant to Section 9.4below.

 

**9.4****                               Disbursementof Deposit**.  If Escrow Agent receives a notice from eitherparty instructing Escrow Agent to deliver the Deposit to such party, EscrowAgent shall deliver a copy of the notice to the other party within three (3) daysafter receipt of the notice.  If theother party does not object to the delivery of the Deposit as set forth in thenotice within three (3) business days after receipt of the copy of thenotice, Escrow Agent shall, and is hereby authorized to, deliver the Deposit tothe party requesting it pursuant to the notice. Any objection hereunder shall be by notice setting forth the nature andgrounds for the objection and shall be sent to Escrow Agent and to the partyrequesting the Deposit.

 

**9.5****                               NoEffect on Rights of Parties; Survival**.  The return of documents and monies as setforth above shall not affect the right of either party to seek such legal orequitable remedies as such party may have under Article X with respectto the enforcement of this Agreement. The obligations under this Article IX shall survivetermination of this Agreement.

 

# **ARTICLE X**

 

# **DEFAULT**

 

**10.1****                        Seller’sRemedies**.  If, for any reason whatsoever (other than thefailure of a condition set forth in Section 3.1 and other than atermination of this Agreement pursuant to Section 2.4(e), Section 5.7,Section 10.2, Article XII, or Article XIV),Purchaser fails to complete the acquisition as herein provided, Purchaser shallbe in breach of its obligations hereunder and Seller shall be released from anyfurther obligations hereunder.  BYINITIALING BELOW, PURCHASER AND SELLER HEREBY ACKNOWLEDGE AND AGREE THAT SELLER’SACTUAL DAMAGES IN THE EVENT OF SUCH A BREACH OF THIS AGREEMENT BY PURCHASERWOULD BE EXTREMELY DIFFICULT OR IMPOSSIBLE TO DETERMINE, THAT THE AMOUNT OF THEDEPOSIT IS THE PARTIES’ BEST AND MOST ACCURATE ESTIMATE OF THE DAMAGES SELLERWOULD SUFFER IN THE EVENT THE TRANSACTION PROVIDED FOR IN THIS AGREEMENT FAILSTO CLOSE, AND THAT SUCH ESTIMATE IS REASONABLE UNDER THE CIRCUMSTANCES EXISTINGON THE DATE OF THIS AGREEMENT.  PURCHASERAND SELLER AGREE THAT SELLER’S RIGHT TO RETAIN THE DEPOSIT SHALL BE THE SOLEAND EXCLUSIVE REMEDY OF SELLER AT LAW IN THE EVENT OF SUCH A BREACH OF THISAGREEMENT BY PURCHASER. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED INTHIS SECTION 10.1, IF PURCHASER BRINGS AN ACTION AGAINST SELLER FORAN ALLEGED BREACH OR DEFAULT BY SELLER OF ITS OBLIGATIONS UNDER THIS AGREEMENT,RECORDS A LIS PENDENS OR 

 

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OTHERWISE ENJOINSOR RESTRICTS SELLER’S ABILITY TO SELL AND TRANSFER THE PROPERTY OR REFUSES TOCONSENT TO OR INSTRUCT RELEASE OF THE DEPOSIT TO SELLER IF REQUIRED BY ESCROWAGENT AND SELLER IS ENTITLED THERETO UNDER THE TERMS HEREOF (EACH A “**PURCHASER’S ACTION**”), SELLER SHALLNOT BE RESTRICTED BY THE PROVISIONS OF THIS SECTION 10.1 FROMBRINGING AN ACTION AGAINST PURCHASER SEEKING EXPUNGEMENT OR RELIEF FROM ANYIMPROPERLY FILED LIS PENDENS, INJUNCTION OR OTHER RESTRAINT, AND/OR RECOVERINGFEES, COSTS AND EXPENSES (INCLUDING ATTORNEYS’ FEES) WHICH SELLER MAY SUFFEROR INCUR AS A RESULT OF ANY PURCHASER’S ACTION BUT ONLY TO THE EXTENT THATSELLER IS THE PREVAILING PARTY; AND THE AMOUNT OF ANY SUCH FEES, COSTS ANDEXPENSES AWARDED TO SELLER SHALL BE IN ADDITION TO THE LIQUIDATED DAMAGES SETFORTH HEREIN.  NOTHING IN THIS AGREEMENTSHALL, HOWEVER, BE DEEMED TO LIMIT PURCHASER’S LIABILITY TO SELLER FOR DAMAGESOR INJUNCTIVE RELIEF FOR BREACH OF PURCHASER’S INDEMNITY OBLIGATIONS UNDER SECTION 5.11ABOVE OR FOR ATTORNEYS’ FEES AND COSTS AS PROVIDED IN SECTION 16.5BELOW.

 

ACCEPTED ANDAGREED TO:

 

| /s/ HB |   | /s/ MA    |
|--------|--------|-----------|
| Seller |   | Purchaser |

 

**10.2****                        Purchaser’sRemedies**.  If the sale is not completed as hereinprovided solely by reason of any material default of Seller, Purchaser shall beentitled, as its sole and exclusive remedy, to either (i) (a) terminatethis Agreement (by delivering notice to Seller which includes a waiver of anyright, title or interest of Purchaser in the Property) and (b) ifPurchaser so elects, pursue an action at law for recovery of Purchaser’s actualout-of-pocket third-party costs incurred as part of Purchaser’s due diligenceefforts and attorney’s fees incurred in connection with the negotiation andpreparation of this Agreement and representation of Purchaser hereunder, up tobut not to exceed $150,000, which action must be commenced, if at all, withinthe sixty (60) day period following the occurrence of such material default ofSeller  (the “**LimitationPeriod**”); provided, however, that if, within theLimitation Period,****Purchasergives Seller written notice of such a breach and Seller commences to cure andthereafter terminates such cure effort, Purchaser shall have an additionalthirty (30) days from the date of such termination within which to commence anaction at law for third-party costs, as aforesaid, as a consequence of Seller’sfailure to cure or (ii) treat this Agreement as being in full forceand effect and pursue only the specific performance of this Agreement, providedthat Purchaser must commence any action for specific performance within sixty(60) days after the scheduled Final Closing Date.  Purchaser waives any right to pursue anyother remedy at law or equity for such default of Seller, including, withoutlimitation, any right to seek, claim or obtain damages****(other than for costs under (i)(b) and(ii) above), punitive damages or consequential damages.  Except as set forth herein and in thisAgreement, in no case shall Seller ever be liable to Purchaser under anystatutory, common law, equitable or other theory of law, either prior to orfollowing the Closing, for any lost rents, profits, “benefit of the bargain,”business opportunities or any form of consequential damage in connection withany claim, liability, demand or cause of action in any 

 

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way or mannerrelating to the Property, the condition of the Property, this Agreement, or anytransaction or matter between the parties contemplated hereunder.  Purchaser’s remedies hereunder are inaddition to the right to receive the return of the Deposit, subject to Section 9.4,to the extent it is not applied to the Purchase Price in connection withPurchaser’s action for specific performance.

 

# **ARTICLE XI**

 

# **REPRESENTATIONSAND WARRANTIES**

 

**11.1****                        Seller’sWarranties and Representations**.  The matters set forth in this Section 11.1constitute representations and warranties by Seller which are now and (subjectto matters contained in any notice given pursuant to the next succeedingsentence) shall, in all material respects, at the Closing be true andcorrect.  If Seller has actual knowledgethat any of the representations and warranties contained in this Article XImay cease to be true, Seller shall give prompt notice to Purchaser (whichnotice shall include copies of the instrument, correspondence, or document, ifany, upon which Seller’s notice is based). As set forth in Section 3.1.4 hereof, the obligation of Purchaser to consummate thistransaction shall be contingent upon the lack of any material variance withrespect to the truth and accuracy of all such representations and warranties tothe extent of Seller’s actual knowledge as of the date scheduled forClosing.  Otherwise, Purchaser shall havethe right to terminate this Agreement in accordance with Section 3.1.4hereof.  As used in this Section 11.1,the phrase “to the extent of Seller’s actual knowledge” shall mean the actualknowledge of Joe Tortorello, the asset manager of Advisor responsible for theProperty.  There shall be no duty imposedor implied to investigate, inquire, inspect, or audit any such matters, andthere shall be no personal liability on the part of such asset manager.  To the extent Purchaser has or acquiresactual knowledge or is deemed to know prior to the expiration of theInvestigation Period that these representations and warranties are inaccurate,untrue or incorrect in any way, such representations and warranties shall bedeemed modified to reflect Purchaser’s knowledge or deemed knowledge.  Purchaser shall be deemed to know arepresentation or warranty is untrue, inaccurate or incorrect if this Agreementor any files, documents, materials, analyses, studies, tests, or reportsdisclosed or made available to Purchaser at the office of Seller’s propertymanager prior to the expiration of the Investigation Period containsinformation which is inconsistent with such representation or warranty.

 

### **11.1.1****              NoBroker**.  Seller has not engaged or dealt with anybroker or finder in connection with the sale contemplated by this Agreement,except Apartment Realty Advisors (the “**Seller’s Broker**”).  Seller shall pay a brokerage commissions tothe Seller’s Broker in accordance with a separate agreement.  Seller shall indemnify and hold harmlessPurchaser from any claims, costs, damages or liabilities (including attorneys’fees) arising from any breach of the representation contained in this Section 11.1.1or if the same shall be based on any statement, representation or agreement bySeller with respect to the payment of any brokerage commissions or finder’sfees.

 

### **11.1.2****              Organization**. Seller has been duly formed, validly exists and is in good standing inthe jurisdiction of its formation and in the state in which the Property islocated.

 

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### **11.1.3****              Powerand Authority**.  Seller has thelegal power, right and authority to enter into this Agreement and to consummatethe transactions contemplated hereby.

###  

### **11.1.4****              Proceedings**.Seller has not received any written notice of any pending or threatened condemnationor similar proceeding affecting any part of the Property.

###  

### **11.1.5****              Contravention**.  Seller is not prohibited from consummatingthe transactions contemplated by this Agreement by any law, regulation,agreement, instrument, restriction, order or judgment.

###  

### **11.1.6****              ServiceContracts**.  The Service Contractslisted on Exhibit F comprise all of the material service contractswhich currently affect the Property as of the date hereof.

###  

### **11.1.7****              Compliance**.  Seller has not received written notice fromany governmental authority that the Property is not in material compliance withall applicable laws, except for such failures to comply, if any, which havebeen remedied.

###  

### **11.1.8****              Employees**.  Seller has no employees on-site at theProperty providing on-site services to the Property and all such services areperformed by Seller’s third party manager of the Property.

###  

### **11.1.9****              Litigation**.  Tothe extent of Seller’s actual knowledge, there is no legal action, suit,proceeding or claim affecting Seller or the Land, Improvements or PersonalProperty or any portion thereof relating to or arising out of the ownership,operation, use or occupancy of the Property being prosecuted in any court or byor before any federal, state, county or municipal department, commission, board,bureau or agency or other governmental instrumentality.

###  

### **11.1.10****       SpecialAssessments**.  Seller has receivedno written notice of any pending improvement liens or special assessments to bemade against the Property by any governmental authority.

###  

### **11.1.11****       Leases**.  Based on information provided by Seller’sproperty manager and to Seller’s actual knowledge, the Rent Roll lists all Leases affecting the Land and Improvements otherthan those Leases entered into by Seller subsequent to the Effective Date, andis the rent roll used in the ordinary course of business, and is true andcorrect.

###  

### **11.1.12****       NoContracts.**  There are no options,contracts or other obligations outstanding for the sale, exchange or transferof the Property or any portion thereof or the business operated thereon.

###  

### **11.1.13****       EnvironmentalIssues**.  Seller has not received any written notice of and has no actualknowledge that any governmental authority or any employee or agent thereof hasdetermined, or threatens to determine, that there is a presence, release,threat of release, placement on or in the Property, of any Pollutants. Sellerhas not entered into any agreements with any governmental authority or agency(federal, state or local) or any tenant or prior owner of the Property or anyowner of any property located near the

###  

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### 

###  

### Property, relating in anyway to the presence, release, threat of release, placement on or in theProperty, or the generation, transportation, storage, treatment, or disposal atthe Property, of any Pollutants.  Forpurposes hereof, “Pollutants” shall mean asbestos, PCB and any substancethat is defined or listed as a hazardous, toxic or dangerous substance underany existing statute, including, without limitation, any substance that is a “hazardoussubstance” under the Comprehensive Environmental Response, Compensation andLiability Act of 1980, as amended by the Superfund Amendments andReauthorization Act of 1986, as the same be further amended, petroleum, naturalgas, natural gas liquids, liquefied natural gas, and synthetic gas usable forfuel, and any materials regulated by Texas law.

###  

### **11.1.14****       PATRIOTAct**.

###  

##### (1)                                  Selleris in compliance with the requirements of Executive Order No. 133224, 66 Fed. Reg. 49079 (Sept. 25, 2001)(the “**Order**”)****and other similar requirements contained in the rules andregulations of the Office of Foreign Assets Control, Department of the Treasury(“**OFAC**”)****and in any enabling legislation or other Executive Orders orregulations in respect thereof (the Order and such other rules, regulations,legislation, or orders are collectively called the “**Orders**”).** **Further,Seller covenants and agrees to make its policies, procedures and practicesregarding compliance with the Orders, if any, available to Purchaser for itsreview and inspection during normal business hours and upon reasonable priornotice.

#####  

##### (2)                                  NeitherSeller nor any beneficial owner of Seller:

#####  

###### (a)                                  islisted on the Specially Designated Nationals and Blocked Persons Listmaintained by OFAC pursuant to the Order and/or on any other list of terroristsor terrorist organizations maintained pursuant to any of the rules andregulations of OFAC or pursuant to any other applicable Orders (such lists arecollectively referred to as the “**Lists**”);

######  

###### (b)                                 isa person or entity who has been determined by competent authority to be subjectto the prohibitions contained in the Orders; or

######  

###### (c)                                  isowned or controlled by, or acts for or on behalf of, any person or entity onthe Lists or any other person or entity who has been determined by competentauthority to be subject to the prohibitions contained in the Orders.

######  

Notwithstanding anythingcontained herein to the contrary, for the purposes of this provision, thephrase “any beneficial owner of Seller” shall not include (x) any holderof a direct or indirect interest in a publicly traded company whose shares arelisted and traded on a United States national stock exchange, or (y) anylimited partner, unit holder or shareholder owning an interest of five percent (5%)or less in Seller or in the holder of any direct or indirect interest inSeller.

 

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** **

**11.2****                        Purchaser’sWarranties and Representations**. The matters set forth in this Section 11.2 constituterepresentations, warranties and covenants by Purchaser which are now and shall,at the Closing, be true and correct.

 

### **11.2.1****              NoBroker**.  Except for Seller’sBroker, Purchaser has not engaged or dealt with any broker or finder inconnection with the sale contemplated by this Agreement.  Purchaser shall indemnify and hold harmlessSeller and Advisor from any claims, costs, damages or liabilities (includingattorneys’ fees) arising from any breach of the representation contained inthis Section 11.2.1 or if the same shall be based on any statement,representation or agreement by Purchaser with respect to the payment of anybrokerage commissions or finder’s fees.

###  

### **11.2.2****              Powerand Authority**.  Purchaser has thelegal power, right and authority to enter into this Agreement and to consummatethe transactions contemplated hereby.

###  

### **11.2.3****              IndependentInvestigation**.  The consummationof this transaction shall constitute Purchaser’s acknowledgment that it hasindependently inspected and investigated the Property and, together with theterms and conditions of this Agreement including Seller’s representations andwarranties under Section 11.1 hereof, has made and entered intothis Agreement based upon such inspection and investigation and its ownexamination of the condition of the Property.

###  

### **11.2.4****              PurchaserReliance**.  Purchaser isexperienced in and knowledgeable about the ownership and management of realestate, and it has relied and will rely exclusively on its own consultants,advisors, counsel, employees, agents, principals and/or studies, investigationsand/or inspections with respect to the Property, its condition, value andpotential.  Purchaser agrees that,notwithstanding the fact that it has received certain information from Selleror its agents or consultants, Purchaser has relied solely upon and willcontinue to rely solely upon its own analysis and will not rely on anyinformation provided by Seller or its agents or consultants, except asexpressly set forth in Section 11.1.

###  

### **11.2.5****              ERISA**.  Purchaser represents, warrants and covenantsthat it is not using the assets of any (i) “employee benefit plan” (withinthe meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“**ERISA**”)), (ii) “plan” (withinthe meaning of Section 4975(e)(1) of the Internal Revenue Code of1986, as amended (the “**Code**”)) or (iii) entitywhose underlying assets include “plan assets” by reason of a plan’s investmentin such entity, to fund its purchase of the Property under this Agreement.

###  

### **11.2.6****              PATRIOTAct**.

###  

##### (1)                                  Purchaseris in compliance with the requirements of the Orders.** **Further, Purchasercovenants and agrees to make its policies, procedures and practices regardingcompliance with the Orders, if any, available to Seller for its review andinspection during normal business hours and upon reasonable prior notice.

 

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##### (2)                                  NeitherPurchaser nor any beneficial owner of Purchaser:

#####  

###### (a)                                  islisted on the Lists;

######  

###### (b)                                 isa person or entity who has been determined by competent authority to be subjectto the prohibitions contained in the Orders; or

######  

###### (c)                                  isowned or controlled by, or acts for or on behalf of, any person or entity onthe Lists or any other person or entity who has been determined by competentauthority to be subject to the prohibitions contained in the Orders.

######  

### **11.2.7****              PATRIOTAct Notice**.  Purchaser herebycovenants and agrees that if Purchaser obtains knowledge that Purchaser or anyof its beneficial owners becomes listed on the Lists or is indicted, arraigned,or custodially detained on charges involving money laundering or predicatecrimes to money laundering, Purchaser shall immediately notify Seller inwriting, and in such event, Seller shall have the right to terminate thisAgreement without penalty or liability to Purchaser immediately upon deliveryof written notice thereof to Purchaser**.**

###  

**11.3****                        NoOther Warranties and Representations**. Except as specifically set forth in this Article XI, neitherSeller nor Advisor has made, makes or has authorized anyone to make, anywarranty or representation as to the Leases, the Service Contracts, any writtenmaterials delivered to Purchaser, the persons preparing such materials, thetruth, accuracy or completeness of such materials, the present or futurephysical condition, development potential, zoning, building or land use law orcompliance therewith, the operation, income generated by, or any other matteror thing affecting or relating to the Property or any matter or thingpertaining to this Agreement.  Purchaserexpressly acknowledges that no such warranty or representation has been madeand that Purchaser is not relying on any warranty or representation whatsoeverother than as is expressly set forth in this Article XI.  Purchaser shall accept the Property “as is”and in its condition on the date of Closing subject only to the expressprovisions of this Agreement and hereby acknowledges and agrees that **EXCEPT AS SET FORTH IN SECTION 11.1 OF THIS AGREEMENT,****SELLER HAS NOT MADE, DOES NOT MAKE ANDSPECIFICALLY NEGATES AND DISCLAIMS ANY REPRESENTATIONS, WARRANTIES ORGUARANTIES OF ANY KIND OR CHARACTER WHATSOEVER, WHETHER EXPRESS OR IMPLIED,ORAL OR WRITTEN, PAST, PRESENT, FUTURE OR OTHERWISE, OF, AS TO, CONCERNING ORWITH RESPECT TO, THE PROPERTY**.

 

### **11.3.1****              NoEnvironmental Representations**. Except as set forth in Section 11.1.13 hereof, Seller makesno representations or warranties as to whether the Property contains asbestos,radon or any hazardous materials or harmful or toxic substances, or pertainingto the extent, location or nature of same, if any.  Further, to the extent that Seller hasprovided to Purchaser information from any inspection, engineering orenvironmental reports concerning asbestos, radon or any hazardous materials orharmful or toxic substances, Seller makes no representations or warranties withrespect to the 

###  

### 24

### 

###  

### accuracyor completeness, methodology of preparation or otherwise concerning thecontents of such reports.

###  

### **11.3.2****              Releaseof Claims**.  Subject to theexpress provisions hereof and except for the representations and warrantiesunder Sections 11.1.13 hereof, Purchaser acknowledges and agrees thatSeller makes no representation or warranty as to, and Purchaser, for itself,its successors and assigns, hereby waives and releases Seller from any presentor future claims, at law or in equity, whether known or unknown, foreseeable orotherwise, arising from or relating to the presence or alleged presence ofasbestos, radon or any hazardous materials or harmful or toxic substances in,on, under or about the Property, including without limitation any claims underor on account of (i) the Comprehensive Environmental Response,Compensation and Liability Act of 1980, as the same may have been or may beamended from time to time, and similar state statutes, and any regulationspromulgated thereunder, (ii) any other federal, state or local law,ordinance, rule or regulation, now or hereafter in effect, that deals withor otherwise in any manner relates to, environmental matters of any kind, (iii) thisAgreement, or (iv) the common law. Purchaser hereby specifically acknowledges that Purchaser has carefullyreviewed this Section 11.3.2 and has discussed its import withlegal counsel and that the provisions of this Section 11.3.2 are amaterial part of this Agreement**.**

###  

This Section 11.3.2shall survive the Closing forever.

 

# **ARTICLE XII**

# ** **

# **CASUALTY ANDCONDEMNATION**

# ** **

Promptly upon learning thereof, Seller shall givePurchaser written notice of any condemnation, damage or destruction of theProperty occurring prior to the Closing. If prior to the Closing any portion of the Property is condemned suchthat there is a material and adverse effect on use of the Property, or ismaterially damaged or destroyed by an insured casualty, Purchaser shall havethe option of either (i) applying the proceeds of any condemnationaward or payment under any insurance policies (other than business interruptionor rental loss insurance applicable to the period prior to Closing) toward thepayment of the Purchase Price to the extent such condemnation awards orinsurance payments have been received by Seller, receiving from Seller anamount equal to any applicable deductible under any such insurance policy andreceiving an assignment from Seller of Seller’s right, title and interest inany such awards or payments not theretofore received by Seller (includingbusiness interruption or rental loss insurance of Seller which would beapplicable to any period subsequent to Closing), or (ii) terminatingthis Agreement by delivering written notice of such termination to Seller andEscrow Agent within ten (10) days after Purchaser has received writtennotice from Seller of such condemnation or material damage or destruction.  If, prior to the Closing, a portion of theProperty is damaged or destroyed and such portion is not a material portion ofthe Property, the proceeds of any condemnation award or payment and anyapplicable deductible under any insurance policies shall be applied toward thepayment of the Purchase Price to the extent such condemnation awards orinsurance payments have been received by Seller and Seller shall assign toPurchaser all of Seller’s right, title and interest in any unpaid awards orpayments.  With respect to option (i) describedabove and the preceding sentence as it relates to the requirement 

 

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of Seller to assign toPurchaser the right to receive insurance awards and payments to be due Seller,Seller agrees that in the event that Seller’s insurance carrier(s) do notpermit assignment thereof Seller agrees to request from the insurance carrier(s) a“policy endorsement” whereby Purchaser shall be added as a “loss payee” underthe Purchaser’s policies effective as of the Closing Date.  For purposes of this Article XII,in defining a casualty, the terms “Material” and “Materially” shall mean damagevalued at greater than $1,000,000.  Ifthe damage or destruction arises out of an uninsured risk, Seller shall elect,by written notice within ten (10) days of the occurrence of such damage ordestruction either to terminate this Agreement or to close the transactioncontemplated hereby with a reduction of the Purchase Price equal to the costsof repairing the Property, as reasonably estimated by an engineer engaged bySeller and reasonably acceptable to Purchaser.

 

**12.1****                        UniformVendor and Purchaser Act Not Applicable**: It is the express intent ofthe parties hereto that the provisions of this Article XII governthe rights of the parties in the event of damage to or condemnation of theproperty and that the Uniform Vendor and Purchaser Act (Section 5.007 ofthe Texas Property Code) not apply to this agreement.

 

# **ARTICLEXIII**

# ** **

# **CONDUCTPRIOR TO CLOSING**

# ** **

**13.1****                        Conduct**.  From and after the date hereof and throughClosing, Seller covenants and agrees to operate the Property as follows:

 

13.1.1                  Seller will cause the Property to bemaintained and operated in a good and workmanlike manner in accordance with themanner as is being conducted by Seller at the time of execution hereof, andwill keep the Improvements and Personal Property in good order and operatingcondition (reasonable wear and tear and casualty accepted), causing allnecessary repairs, renewals and replacements to be promptly made. Seller willnot knowingly use or occupy the Property in a manner that constitutes waste ora public or private nuisance or that makes void, voidable or cancelable, orincreases the premium of, any insurance then in force with respect thereto.Seller will not do any act whereby the value of any part of the Property may bematerially lessened.

 

13.1.2                  Seller will advise Purchaser promptly of anychange in any applicable laws, regulations, restrictions, rulings, or ordersthat might affect the value or use of the Property by Purchaser of which Sellerobtains written notice after the Effective Date. Seller will also advisePurchaser promptly of any litigation, arbitration or administrative hearingconcerning or affecting the Property of which Seller obtains written noticeafter the Effective Date.

 

13.1.3                  Without obtaining Purchaser’s prior consent,which consent will not be unreasonably withheld, Seller will enter into nolease with respect to any portion of the Property unless such lease is on astandard form customarily utilized at the Property and is in conformity withthe Seller’s Lease Guidelines; which are attached hereto as Exhibit L.

 

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13.1.4                  Subject to the prorations prescribed herein,Seller will cause to be paid all trade accounts, costs and expenses ofoperation and maintenance of the Property incurred and accruing or due prior toClosing.

 

13.1.5                  Seller will not knowingly take any action,which action would have the effect of materially violating any of the Representationsand Warranties of Seller set forth in Section 11.1 of theAgreement.

 

13.1.6                  Seller will not, without the prior writtenconsent of Purchaser, remove any equipment forming a part of the Propertyexcept such as is replaced by Seller by an article of substantially equalsuitability and value, free and clear of any lien or security interest.

 

13.1.7                  Intentionally Omitted

 

13.1.8                  Seller will not, without Purchaser’s priorwritten consent, enter into any contracts of a continuing nature (or any optionalrenewal of Service Contracts) for services, supplies, or materials affectingthe Property that cannot be canceled on thirty (30) days’ notice.

 

13.1.9                  If any apartment unit is vacated more than five (5) businessdays prior to Closing, then prior to Closing Seller shall return such unit torentable condition in accordance with Seller’s customary cleaning, painting,and repair standards for vacant units (the condition of such an apartment unitafter cleaning is referred to herein as a “**Rent Ready Condition**”);provided if Seller fails to return any such vacated unit to a Rent ReadyCondition prior to Closing, or a unit is vacated within five (5) businessdays of Closing and Seller fails to return such unit to rent ready condition byClosing, then at Closing Seller shall credit Purchaser an amount equal to thereasonably estimated cost to return such unit to a Rent Ready Condition, up to,but not to exceed, $500.

 

**13.2****                        ActionsProhibited**.  Seller shall not,without the prior written approval of Purchaser:

 

#### (i)                                     makeany material structural alterations or additions to the Property except as (a) inthe ordinary course of operating the Property, (b) required formaintenance and repair, (c) required by any of the Leases or the ServiceContracts or (d) required by this Agreement;

####  

#### (ii)                                  sell,transfer, encumber or change the status of title of all or any portion of theProperty;

####  

#### (iii)                               changeor attempt to change, directly or indirectly, the current zoning of the RealProperty in a manner materially adverse to it; or

####  

#### (iv)                              cancel,amend or modify, in a manner materially adverse to the Property, any license orpermit held by Seller with respect to the Property or any part thereof whichwould be binding upon Purchaser after the Closing.

####  

#### 27

#### 

** **

**13.3****                        Modificationof Existing Leases and Service Contracts**.  Prior to the expiration of the InvestigationPeriod, Seller may cancel, amend and modify any of the Leases and any of theContracts, provided such action is in the ordinary course of businessand notice is given to Purchaser within five (5) business days after suchaction and in any event at least two (2) business days prior to theexpiration of the Investigation Period. After the expiration of the Investigation Period, Seller may not cancel,amend, or modify any material Service Contracts (except those Purchaser haselected to terminate under Section 5.6) or Leases, in a mannerbinding upon Purchaser after the Closing, unless such action is in the ordinarycourse of business, the Service Contract is cancelable on thirty (30) days orless notice without penalty or premium, and unless Seller obtains prior writtenconsent thereof from Purchaser, which consent shall not be unreasonablywithheld.

 

**13.4****                        NewLeases and Contracts**.  Prior tothe expiration of the Investigation Period (and up and until the Closing Datewith respect to new leases), Seller may enter into any new lease or servicecontract affecting the Property, or any part thereof, provided such newlease is in conformity with Seller’s Lease Guidelines or otherwise consented toin writing by Purchaser and, with respect to service contracts, notice is givento Purchaser within five (5) business days after such action and in anyevent at least two (2) business days prior to the expiration of theInvestigation Period and the service contract is cancelable on thirty (30) daysnotice, or less without penalty or premium. After the expiration of the Investigation Period, Seller may not enterinto any service contract without Purchaser’s consent, which consent will notbe unreasonably withheld or delayed. Notwithstanding the preceding sentence, after the expiration of theInvestigation Period, Seller may enter into any new service contracts withoutPurchaser’s consent if doing so is in the ordinary course of operating theProperty and the contract (i) will not be binding on Purchaserafter Closing unless Purchaser elects prior to Closing to assume such servicecontract or (ii) is cancelable on thirty (30) days or less noticewithout penalty or premium.

 

If Seller shall request Purchaser’s approval to any ofthe foregoing matters, Purchaser shall have five (5) days from its receiptof such request to give Seller notice of its approval or disapproval of suchmatter.  If Purchaser does not give suchnotice, such matter shall be deemed approved by Purchaser.

 

**13.5****                        Rightto Cure**.  If any title defect orother  matter which would entitlePurchaser to terminate this Agreement shall first arise after Purchasernotifies Seller of its Title Objections pursuant to Section 5.3 andprior to the Closing or if Seller shall have breached any representation orwarranty hereunder, Seller may elect, by written notice to Purchaser, to curesuch title defect or other matter by causing it to be removed, insured over orbonded to cure such breach and Seller may adjourn the Closing for up to thirty(30) days to do so.  Nothing contained inthis Section 13.5 shall require Seller to cure any such titledefect or other matter or to incur any liability or expense to do so.

 

# **ARTICLE XIV**

# ** **

# **OCCUPANCY CONTINGENCY**

# ** **

Anything in thisAgreement to the contrary notwithstanding, it shall be condition 

 

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precedent to Purchaser’sobligation to close that as of the Closing Date, Actual Occupancy (as definedbelow) shall be at least 85.0% (the “**OccupancyCondition**”).  If as of theClosing Date the above Occupancy Condition has not been achieved or exceeded,then Seller may, at its option by written notice to Purchaser, elect to extendthe Closing Date by thirty (30) days in order to provide more time to achieveor exceed the Occupancy Condition. If Seller does not elect to extend theClosing Date, or if Seller extends the Closing Date but the Occupancy Conditionstill has not been achieved or exceeded as of the extended Closing Date, thenPurchaser may, at its option, elect either to (i) terminate thisAgreement, whereupon the Deposit will be returned to Purchaser, andneither party shall have any further right or obligation hereunder other thanas set forth herein with respect to rights or obligations which survivetermination, or (ii) waive the Occupancy Condition and close.  If the Occupancy Condition has not beenachieved or exceeded and Purchaser does not advise Seller in writing of itselection to terminate this Agreement on or before the scheduled Closing Date,then Purchaser shall be deemed to have elected to waive the Occupancy Conditionand close, whereupon the Closing shall occur on the scheduled Closing Date.

 

In determining whetherthe Occupancy Condition has been “exceeded” or “achieved,”  the specific percentage occupancy numbersshall be rounded up to the nearest whole number if the fractional portion ofsaid number is equal to or greater than .5 but shall not be rounded down to thenearest whole number if the fractional portion of said number is less than..5.  By way of illustration, 84.5% wouldbe rounded up to 85.0%, but 84.4% would not be rounded down to 84.0%.

 

As used herein, the term “**Actual Occupancy**” shall mean, withrespect to all apartment units on the Property (except for the model unit), thepercentage of said units for which a leasehold tenancy exists pursuant to alease signed by both landlord and tenant (regardless of whether the tenant hastaken physical occupancy or commenced payment of rent) but shall be reduced******based on move-out notices receivedby Seller as of the Closing Date.

 

# **ARTICLE XV**

# ** **

# **NOTICES**

# ** **

All notices, demands or other communications givenhereunder shall be in writing and shall be deemed to have been duly delivered (i) uponthe delivery (or refusal to accept delivery) by messenger or overnight expressdelivery service (or, if such date is not on a business day, on the businessday next following such date), or (ii) on the third (3rd) businessday next following the date of its mailing by certified mail, postage prepaid,at a post office maintained by the United States Postal Service, or (iii) uponthe receipt by facsimile transmission as evidenced by a receipt transmissionreport (followed by next day delivery by one of the other means identified in (i)-(ii)),addressed as follows:

 

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If toPurchaser, to:

 

HarvardProperty Trust, LLCAttn: Mark T. Alfieri, Senior Vice President15601 Dallas Parkway, #600Addison, Texas 75001Facsimile:  (214) 655-1610

 

with acopy to:

 

Robert L. Abbott, P.C.Attn:  Robert L. Abbott2828 Routh Street, Suite 500Dallas, Texas 75201Facsimile:  (214) 848-9823

 

If toSeller, to:

 

VerandahOwner Limited Partnershipc/o BH Equities, L.L.C.400 Locust Street, Suite 790Des Moines, Iowa 50309Attention: Nicholas Roby, Esq.Facsimile: (515) 244-2742

 

with acopy to:

 

c/o BlackRock RealtyAdvisors, Inc.300 Campus Drive, 3rd Floor,Florham Park, New Jersey 07932Attention: Mario Mirabelli, Vice PresidentFacsimile: (646) 521-4990

 

and

 

Diamond Verandah LLCc/o BlackRock Realty Advisors, Inc.300 Campus Drive, 3rd Floor,Florham Park, New Jersey 07932Attention: Jeremy Litt, Esq.Facsimile: (646)521-4998

 

and

 

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Goodwin Procter LLPExchange PlaceBoston, Massachusetts  02109Attention:  Lawrence R. Cahill, Esq.Facsimile:  (617) 227-8591

 

If to Escrow Agent, to:

 

Partners Title Company712 Main Street, Suite 2000EHouston, Texas 77002-3218Attention:  Reno Hartfiel,Executive VP / General CounselFacsimile: (713) 238-9199

 

Either party may, bynotice given as aforesaid, change the address or addresses, or designate anadditional address or additional addresses, for its notices, provided, however,that no notice of a change of address shall be effective until actual receiptof such notice.

 

# **ARTICLE XVI**

 

# **TRANSFER OF POSSESSION**

 

**16.1****                        Transferof Possession**.  Possession of theProperty shall be transferred to Purchaser at the time of Closing subject tothe Permitted Exceptions.

 

**16.2****                        Deliveryof Documents at Closing**.  At thetime of Closing, Seller shall deliver to Purchaser originals or copies of anyadditional documents, instruments or records in the possession of Seller or itsagents which are necessary for the ownership and operation of the Property.

 

# **ARTICLEXVII**

 

# **GENERALPROVISIONS**

 

**17.1****                        Captions**.  Captions in this Agreement are inserted forconvenience of reference only and do not define, describe or limit the scope orthe intent of this Agreement or any of the terms hereof.

 

**17.2****                        Exhibits**.  All exhibits referred to herein and attachedhereto are a part hereof.

 

**17.3****                        EntireAgreement**.  This Agreementcontains the entire agreement between the parties relating to the transactioncontemplated hereby and all prior or contemporaneous agreements,understandings, representations and statements, oral or written, are mergedherein.

 

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**17.4****                        Modification**.  No modification, waiver, amendment, dischargeor change of this Agreement shall be valid unless the same is in writing andsigned by the party against which the enforcement of such modification, waiver,amendment, discharge or change is or may be sought.

 

**17.5****                        Attorneys’Fees**.  Should any party heretoemploy an attorney for the purpose of enforcing or construing this Agreement,or any judgment based on this Agreement, in any legal proceeding whatsoever,including insolvency, bankruptcy, arbitration, declaratory relief or otherlitigation, the prevailing party shall be entitled to receive from the otherparty or parties thereto reimbursement for all reasonable attorneys’ fees andall costs, whether incurred at the trial or appellate level, including but notlimited to service of process, filing fees, court and court reporter costs,investigative costs, expert witness fees and the cost of any bonds, whethertaxable or not, and such reimbursement shall be included in any judgment,decree or final order issued in that proceeding.  The “prevailing party” means the party inwhose favor a judgment, decree, or final order is rendered.

 

**17.6****                        GoverningLaw**.  This Agreement shall beconstrued and enforced in accordance with the laws of the State in which theProperty is located.

 

**17.7****                        Time ofEssence**.  Time is of the essenceto this Agreement and to all dates and time periods set forth herein.

 

**17.8****                        Survivalof Warranties**.  Only those warrantiesand representations contained in Sections 11.1 and 11.2 andthe provisions of Section 11.3 shall survive the Closing, thedelivery of the Deed and the payment of the Purchase Price, providedthat (i) such representations and warranties (but not such provisions)shall cease and terminate nine (9) months after the date of Closing,except in respect of any representation or warranty as to which Purchaser orSeller, as the case may be, shall have commenced, on or before such nine (9) monthanniversary, a legal proceeding based on the breach thereof as of the date ofClosing, and then only for so long as such proceeding shall continue andlimited to the breach therein claimed, (ii) Seller shall have noliability to Purchaser with respect thereto unless and until the damagessuffered by Purchaser as a result thereof shall equal or exceed $25,000 in theaggregate, and (iii) the maximum total liability for which Sellershall be responsible with respect to all representations and warranties shallnot exceed the Maximum Liability Cap in the aggregate.  Unless otherwise expressly herein stated tosurvive, all other representations, covenants, indemnities, conditions andagreements contained herein shall merge into and be superseded by the variousdocuments executed and delivered at Closing and shall not survive theClosing.  Seller shall have no liabilityto Purchaser after Closing for any matter disclosed by Seller pursuant to theterms of this Agreement or disclosed to Purchaser prior to Closing.

 

**17.9****                        Assignmentby Purchaser**.  Purchaser may notassign its rights under this Agreement.  Notwithstanding the foregoing,Purchaser may upon written notice to Seller assign its rights under thisAgreement to (a) any affiliate of Purchaser, or (b) any entity inwhich Purchaser, or the principals thereof, have control as defined herein, provided that  in each instance’ Purchaserremains liable for Purchasers obligations hereunder.  For purposesof this Section 16.9, an “affiliate” means (i) any entity thatcontrols, is controlled by, or is under common control, with the entity inquestion, or (ii) any investment program or any of its affiliates,sponsored by Behringer Harvard Holdings, LLC, the general partner ofPurchaser.  The 

 

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term “control”means the possession, directly or indirectly, of the power to direct or causethe direction of the management and policies of an entity, whether through theownership of voting securities or otherwise

 

**17.10****                 Severability**.  If any term, covenant, condition, provisionor agreement herein contained is held to be invalid, void or otherwiseunenforceable by any court of competent jurisdiction, the fact that such term,covenant, condition, provision or agreement is invalid, void or otherwise unenforceableshall in no way affect the validity or enforceability of any other term,covenant, condition, provision or agreement herein contained.

 

**17.11****                 Successors andAssigns**.  All terms of thisAgreement shall be binding upon, inure to the benefit of and be enforceable by,the parties hereto and their respective legal representatives, successors andassigns (subject to Section 16.9).

 

**17.12****                 Interpretation**.  Seller and Purchaser acknowledge each to theother that both they and their counsel have reviewed and revised this Agreementand that the normal rule of construction to the effect that anyambiguities are to be resolved against the drafting party shall not be employedin the interpretation of this Agreement or any amendments or exhibits hereto.

 

**17.13****                 Counterparts**.  This Agreement may be executed in any numberof counterparts, each of which so executed shall be deemed an original; suchcounterparts shall together constitute but one agreement.

 

**17.14****                 Recordation**.  This Agreement may not be recorded and anyattempt to do so shall be of no effect whatsoever.

 

**17.15****                 Limitation onLiability**.  In any action broughtto enforce the obligations of Seller under this Agreement or any other documentdelivered in connection herewith, the judgment or decree shall be subject tothe provisions of Section 16.8 and shall, otherwise in any event,be enforceable against Seller only up to an amount not to exceed 2.5% of thePurchase Price (“**Maximum Liability Cap**”).  In connection with this Agreement, Advisor isacting as the investment adviser to Seller and shall not have any individualliability hereunder. No shareholder, officer, employee or agent of orconsultant to Advisor or of or to Seller shall be held to any personalliability hereunder, and no resort shall be had to their property or assets, orthe property or assets of Advisor for the satisfaction of any claims hereunderor in connection with the affairs of Advisor. Furthermore, Seller’s liability under this Agreement is explicitlylimited to Seller’s interest in the Property, including any proceedsthereof.  Purchaser shall have norecourse against any other property or assets of Seller, if any, any assets ofthe Advisor, or to any of the past, present or future, direct or indirect,shareholders, partners, members, managers, principals, directors, officers,agents, incorporators, affiliates or representatives of Seller or the Advisor(collectively, “**Seller Parties**”)or of any of the assets or property of any of the Seller Parties for thepayment or collection of any amount, judgment, judicial process, arbitralaward, fee or cost or for any other obligation or claim arising out of or basedupon this Agreement and requiring the payment of money by Seller.  Except as otherwise expressly set forth inthis Agreement, neither Seller nor any Seller Party shall be subject to levy,lien, execution, attachment or other enforcement procedure for the satisfactionof any of Purchaser’s rights or remedies under or with respect to thisAgreement, at law, in equity or otherwise. Purchaser shall 

 

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not seekenforcement of any judgment, award, right or remedy against any property orasset of Seller or any Seller Parties other than Seller’s interest in theProperty or any proceeds thereof.  Theprovisions of this Section shall survive the termination of thisAgreement.

 

**17.16****                 Possession ofAdvisor**.  As used in thisAgreement, the “possession” or “receipt” of a document, notice or similarwriting by Seller shall be deemed to be only the possession, receipt or noticeof such document by Advisor.

 

**17.17****                 Business Day**.  As used in this Agreement, “business day”shall be deemed to be any day other than a day on which banks in the state ofTexas shall be permitted or required to close.

 

**17.18****                 Waiver of JuryTrial**.  PURCHASER AND SELLERHEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BYJURY IN RESPECT OF ANY LITIGATION BASED HEREON, ARISING OUT OF, UNDER OR INCONNECTION WITH THIS AGREEMENT OR ANY DOCUMENTS CONTEMPLATED TO BE EXECUTED INCONNECTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS(WHETHER ORAL OR WRITTEN) OR ANY ACTIONS OF EITHER PARTY ARISING OUT OF ORRELATED IN ANY MANNER WITH THIS AGREEMENT OR THE PROPERTY (INCLUDING WITHOUTLIMITATION, ANY ACTION TO RESCIND OR CANCEL THIS AGREEMENT OR ANY CLAIMS ORDEFENSES ASSERTING THAT THIS AGREEMENT WAS FRAUDULENTLY INDUCED OR IS OTHERWISEVOID OR VOIDABLE). THIS WAIVER IS A MATERIAL INDUCEMENT FOR SELLER TO ENTERINTO AND ACCEPT THIS AGREEMENT AND THE DOCUMENTS TO BE DELIVERED BY PURCHASERAT CLOSING, AND SHALL SURVIVE THE CLOSING OR TERMINATION OF THISAGREEMENT.  Each party hereby authorizesand empowers the other to file this Section 16.18 and thisAgreement with the clerk or judge of any court of competent jurisdiction as awritten consent to waiver of jury trial.

 

# **ARTICLE XVIII**

 

# **ESCROW AGENT DUTIES ANDDISPUTES**

 

**18.1****                        OtherDuties of Escrow Agent**.  EscrowAgent shall not be bound in any way by any other agreement or contract betweenSeller and Purchaser, whether or not Escrow Agent has knowledge thereof.  Escrow Agent’s only duties andresponsibilities with respect to the Deposit shall be to hold the Deposit andother documents delivered to it as agent and to dispose of the Deposit and suchdocuments in accordance with the terms of this Agreement.  Without limiting the generality of theforegoing, Escrow Agent shall have no responsibility to protect the Deposit andshall not be responsible for any failure to demand, collect or enforce anyobligation with respect to the Deposit or for any diminution in value of theDeposit from any cause, other than Escrow Agent’s gross negligence or willfulmisconduct.  In the event of any disputehereunder, Escrow Agent may, at the expense of Seller and Purchaser, consultwith counsel and accountants in connection with its duties under thisAgreement.  Escrow Agent shall not beliable to the parties hereto for any act taken, suffered or permitted by it ingood faith in accordance with the advice of counsel and accountants.  Escrow Agent shall not be obligated to takeany action hereunder that may, in its reasonable judgment, result in anyliability to it unless Escrow Agent 

 

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shall have beenfurnished with reasonable indemnity satisfactory in amount, form and substanceto Escrow Agent.

 

**18.2****                        Disputes**.  Escrow Agent is acting as a stakeholder onlywith respect to the Deposit.  If there isany dispute as to whether Escrow Agent is obligated to deliver the Deposit oras to whom the Deposit is to be delivered, Escrow Agent shall not make anydelivery, but shall hold the Deposit until receipt by Escrow Agent of anauthorization in writing, signed by all the parties having an interest in thedispute, directing the disposition of the Deposit, or, in the absence ofauthorization, Escrow Agent shall hold the Deposit until the finaldetermination of the rights of the parties in an appropriate proceeding.  Escrow Agent shall have no responsibility todetermine the authenticity or validity of any notice, instruction, instrument,document or other item delivered to it, and it shall be fully protected inacting in accordance with any written notice, direction or instruction given toit under this Agreement and believed by it to be authentic.  If written authorization is not given, orproceedings for a determination are not begun, within thirty (30) days afterthe date scheduled for the closing of title and diligently continued, EscrowAgent may, but is not required to, bring an appropriate action or proceedingfor leave to deposit the Deposit with a court of the State of Texas pending adetermination.  Escrow Agent shall bereimbursed for all costs and expenses of any action or proceeding, including,without limitation, attorneys’ fees and disbursements incurred in its capacityas Escrow Agent, by the party determined not to be entitled to theDeposit.  Upon making delivery of theDeposit in the manner provided in this Agreement, Escrow Agent shall have nofurther liability hereunder.  In no eventshall Escrow Agent be under any duty to institute, defend or participate in anyproceeding that may arise between Seller and Purchaser in connection with theDeposit.

 

**18.3****                        Reports**.  Escrow Agent shall be responsible for thetimely filing of any reports or returns required pursuant to the provisions of Section 6045(e) ofthe Internal Revenue Code of 1986 (and any similar reports or returns requiredunder any state or local laws) in connection with the closing of thetransaction contemplated by this Agreement.

 

[Remainder of Page IntentionallyLeft Blank]

 

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**IN WITNESS WHEREOF**,this Agreement has been executed as of the date first set forth above.

 
|   | **SELLER**:                              |
|--------|------------------------------------------|
|   |                                     |
|   | **VERANDAH OWNER LIMITED  PARTNERSHIP**, |
|   | a Delaware limited partnership           |
|   |                                     |
|   | By:                                      | Houston Verandah Investor Limited Partnership, a  Delaware limited partnership, its general partner |
|   |                                     |   |
|   |                                     | By: | BH Verandah, L.L.C., an Iowa limited liability  company, its general partner |
|   |                                     |   |   |
|   |                                     |   | By: | BH Equities L.L.C., an Iowa limited liability  company, its managing member |
|   |                                     |   |   |   |
|   |                                     |   |   | By: | /s/ Harry Bookey |
|   |                                     |   |   |   | Name: Harry Bookey |
|   |                                     |   |   |   | Title: Manager |
|   |                                     |   |   |   |   |
|   |                                     |   |   |   |   |
|   | **PURCHASER**:                           |
|   |                                     |
|   | **HARVARD PROPERTY TRUST, LLC,**         |
|   | a Delaware limited liability company     |
|   |                                     |
|   |                                     |
|   |                                     | By: | /s/ Mark T. Alfieri |
|   |                                     |   | Mark T. Alfieri, Senior Vice President |

 

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**CONSENTAND AGREEMENT OF ESCROW AGENT**

 

The undersigned Escrow Agent hereby agrees to (i) acceptthe foregoing Agreement, (ii) be escrow agent under said Agreement,and (iii) be bound by said Agreement in the performance of itsduties as escrow agent.

 
|   | PARTNERS TITLE COMPANY |
|--------|------------------------|
|   |                   |
|   |                   |
|   | By:                    | /s/ Reno Hartfiel |
|   |                   | Name: Reno Hartfiel |
|   |                   | Title:   Executive Vice  President & General Counsel |

 

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**EXHIBIT A**

 

**Descriptionof Land**

 

Being a tract or parcel containing 5.313 acres(231,427 square feet) of land situated in the James D. Owen Survey, AbstractNumber 612; being out of and a part of Unrestricted Block 7, of MEYER PARK, SECTION 2,a subdivision plat of record in Volume 142, Page 30, Harris County MapRecords; and being out of and a part of that certain tract of land (Tract One)conveyed to Aramco Services Company as described in deed recorded under HarrisCounty Clerk’s File (H.C.C.F.) Number H104446, Harris County, Texas; and beingthat certain called 5.313 acre tract conveyed to Verandah IH-610, L.P. asdescribed in deed recorded under H.C.C.F. number W636306; and said 5.313 acretract being more particularly described by metes and bounds as follows(bearings are oriented to said record plat):

 

BEGINNING at 1-inch iron rod found in the northright-of-way (R.O.W.) line of Braeswood Boulevard (100 feet wide) and markingthe most southerly southwest corner of the aforesaid Block 7 and the hereindescribed tract;

 

THENCE, North 06°18’24” West, along a southwest lineof said Block 7, a distance of 150.00 feet to an interior corner of said Blockand the herein described tract, from which a found 1-inch iron rod bears South60°43’ West, 0.26 feet;

 

THENCE, South 71°35’50” West, along a southwest lineof said Block 7, a distance of 150.00 feet to the curved east R.O.W. line ofInterstate Highway 610 (West Loop South) (Width Varies) for the most westerlysouthwest corner of said Block 7 and the herein described tract and for a pointof tangency of a non-tangent curve to the right, from which a found 1-inch ironrod bears North 66°35’ West, 0.36 feet;

 

THENCE, Northerly, an arc distance of 288.32 feetalong said east R.O.W. line and the west line of said Block 7 and along saidcurve to the right, having a central angle of 01°26’45”, a radius of 11,425.80feet and a chord which bears North 05°14’26” West, 288.31 feet to a 5/8-inchiron rod with plastic cap stamped “Terra Surveying” set marking the northwestcorner of the herein described tract;

 

THENCE, departing said east R.O.W. line and over andacross the aforesaid Aramco Services Company tract, the following courses anddistances:

 

North 89°49’01” East, a distance of 86.98 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

South 45°41’49” East, a distance of 14.27 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

North 89°49’01” East, a distance of 34.78 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

North 44°49’01” East, a distance of 14.14 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

1

----

 

North 89°49’01” East, a distance of 215.65 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

North 44°49’01” East, a distance of 52.57 feet to an “X” set inconcrete for an interior corner of the herein described tract;

 

North 89°49’01” East, a distance of 396.89 feet to “X” set in concreteset in the curved west R.O.W. line of Meyer Park Drive (60 feet wide) and theeast line of the aforesaid Block 7 and marking a point of curvature of anon-tangent curve to the left and the northeast corner of the herein describedtract;

 

THENCE, Southerly, an arc distance of 170.01 feetalong said west R.O.W. line and the east line of said Block 7 and along saidcurve to the left, having a central angle of 10°49’14”, a radius of 900.22 feetand a chord which bears South 16°02’49” East, 169.76 feet to the most northerlyend of a cutback-line for the most easterly southeast corner of said Block 7and the herein described tract, from which a found 5/8-inch iron rod bearsSouth 05°53’ East, 0.17 feet;

 

THENCE, South 23°32’34” West, along said cutback-line,a distance of 14.16 feet to the aforesaid north R.O.W. line of BraeswoodBoulevard for the most southerly southeast corner of said Block 7 and theherein described tract, from which a found 5/8-inch iron rod bears South 16°31’East, 0.65 feet;

 

THENCE, South 68°32’34” West, along the common line ofsaid north R.O.W. line and the south line of said Block 7, a distance of 435.95feet to a point of curvature of a tangent curve to the right, from which afound 5/8-inch iron rod bears South 19°40’ West, 0.22 feet;

 

THENCE, Southwesterly, an arc distance of 107.06 feetcontinuing along said common line and said curve to the right, having a centralangle of 01°04’14”, a radius of 5,730.00 feet and a chord which bears South69°04’41” West, 107.06 feet to a point of reverse curvature for a tangent curveto the left, from which a found 5/8-inch iron rod bears South 62°55’ West, 0.20feet;

 

THENCE, Southwesterly, an arc distance of 107.06 feetcontinuing along said common line and said curve to the left, having a centralangle, of 01°04’14”, a radius of 5,730.00 feet and a chord which bears South69°04’41” West, 107.06 feet to a point of tangency, from which a found 5/8-inchiron rod bears South 09°03’ East, 0.55 feet;

 

THENCE, South 68°32’34” West, continuing along saidcommon line, a distance of 45.05 feet to the POINT OF BEGINNING and containing5.313 acres (231,427 square feet) of land. This description is based on the Land Title Survey and plat made byTerra Surveying Company, Inc., dated July 1, 2002, latest revisiondated April 27, 2005.  TSC ProjectNumber 0038-0101-S.

 

2

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**EXHIBIT B**

 

**Rent Roll**

 

----

 

**EXHIBIT C**

 

**ASSIGNMENT OF TENANT LEASES AND ASSUMPTION AGREEMENT**

*(The Verandah at Meyerland Apartments, Houston,Texas)*

 

THISASSIGNMENT OF TENANT LEASES AND ASSUMPTION AGREEMENT is made as of the           dayof               ,2009, by and between **VERANDAH OWNER LIMITEDPARTNERSHIP,**a Delaware limited partnership (“Assignor”), and                                                      ,a                  limited partnership (“Assignee”).

 

W I T N E S S E T H:

 

For good and valuableconsideration, receipt and sufficiency of which are hereby acknowledged,Assignor and Assignee hereby agree as follows:

 

1.                                       Assignorhereby sells, transfers, assigns and conveys to Assignee all right, title andinterest of Assignor in and to all leases,rental agreements, licenses, and other similar arrangements permittingoccupancy or use by another of any apartment unit in the Improvements or anyother space or area on the Land or in the Improvements, including, withoutlimitation, each of the leasesdescribed on the rent roll attached hereto as Exhibit B-1, whichAssignor represents that, based on information provided by Assignor’s propertymanager and to Assignor’s knowledge (as defined in that certain Sale, Purchaseand Escrow Agreement dated                       ,2009 (the “Sale Agreement”), by and between Assignor, as Seller, andHarvard Property Trust, LLC, as Purchaser, whose rights thereunder have beenassigned to Assignee), that certain Sale, Purchase and Escrow Agreement amongAssignor, Assignee and Partners Title Company) , is true, complete and correct,along with the leases, agreements and/or licenses identified in Exhibit B-2attached hereto (collectively, the “Leases”), along with Assignee’sright, title and interest in and to allguaranties of Leases, all rents, revenues, income, profits and receipts dueunder Leases or otherwise receivable by the owner of the Land and Improvementsfor use or occupancy of any of the Land or Improvements, and all security andother deposits and advance payments under Leases (subject to proration and/orretention by Assignor as provided in the Purchase Agreement) to the extentassignable.  As used herein, the term “Land”shall mean the land situated in Harris County, Texas, more particularlydescribed in Exhibit A attached hereto (the “Land”), and theterm “Improvements” shall mean the all structures, fixtures, buildings,and improvements situated on the Land.

 

2.                                       This Assignment of Tenant Leases andAssumption Agreement shall be construed and enforced in accordance with thelaws of the State of Texas.

 

3.                                       Consistent with the Purchase Agreement, whichis hereby incorporated by reference as if herein set out in full and except asset forth herein, the Leases conveyed hereunder are conveyed by Assignor and acceptedby Assignee **WITHOUT ANY REPRESENTATION ORWARRANTIES OF WHATSOEVER NATURE, EXPRESS OR IMPLIED, EXCEPT AS EXPRESSLY SETFORTH HEREIN OR IN THE PURCHASE AGREEMENT.**

 

4.                                       Assignee hereby accepts the assignment of theLeases and agrees to assume and discharge, in accordance with the termsthereof, all of the obligations thereunder from and after the date hereof.

 

5.                                       Assignee agrees to indemnify and holdharmless Assignor from any cost, liability,

 

----

 

damageor expense (including attorneys’ fees) arising out of or relating to Assignee’sfailure to perform any of the foregoing obligations accruing on or after thedate hereof.

 

6.                                       Assignor agrees to indemnify and holdharmless Assignee from any cost, liability, damage or expense (includingattorneys’ fees) arising out of or relating to Assignor’s failure to performany of the obligations of Assignor under the Leases, to the extent accruingprior to the date hereof.

 

7.                                       This Assignment and Assumption may beexecuted in any number of counterparts, each of which shall be deemed anoriginal, but all of which shall constitute one and the same instrument.

 

**[Signature pages immediately follow.]**

 

----

 

IN WITNESS WHEREOF, theparties hereto have executed this Assignment of Tenant Leases and AssumptionAgreement as of the date first above written.

 

 
| ** ** | **ASSIGNOR**:                                                       |
|------------|---------------------------------------------------------------------|
|       |                                                                |
|       | VERANDAH OWNER LIMITED PARTNERSHIP, a Delaware  limited partnership |
|       |                                                                |
|       | By:                                                                 | Houston Verandah Investor Limited Partnership, a  Delaware limited partnership, its general partner |
|       |                                                                |   |
|       |                                                                | By: | BH Verandah, L.L.C., an Iowa limited liability  company, its general partner |
|       |                                                                |   |   |
|       |                                                                |   | By: | BH Equities L.L.C., an Iowa limited liability  company, its managing member |
|       |                                                                |   |   |   |
|       |                                                                |   |   | By: |   |
|       |                                                                | Name: Harry Bookey |
|       |                                                                | Title: Manager |

 

 
| THE STATE OF |   | § |
|--------------|--------|--------|
|         |   | § |
| COUNTY OF    |   | § |
|              |        |        |  |

 

Thisinstrument was acknowledged before me on this           day of                                 ,2009, by Harry Bookey, the Manager of BH Equities L.L.C., an Iowa limitedliability company, the managing member of BH Verandah, L.L.C., an Iowa limitedliability company, the general partner of Houston Verandah Investor LimitedPartnership, a Delaware limited partnership, the general partner of VerandahOwner Limited Partnership, a Delaware limited partnership, on behalf of saidlimited liability company and limited partnership.

 

 
|                   |                          |
|------------------------|-------------------------------|
|                   | NOTARY PUBLIC in and for  the |
|                   | State of                      |   |
| My Commission Expires: | Printed Name of Notary:       |   |
|                   |                          |
|                        |                               |  |  |

 

----

 

IN WITNESS WHEREOF, theparties hereto have executed this Assignment of Tenant Leases and AssumptionAgreement as of the date first above written.

 
| ** **   | **ASSIGNEE**:          |
|--------------|------------------------|
|         |                   |
| ** **   | **[PURCHASER ENTITY]** |
|         |                   |
|         |                   |
|         | By:                    |   |
|         |                   | Name: |   |
|         |                   | Title: |   |
|         |                   |
|         |                   |
| THE STATE OF |                   | § |
|         | §                 |
| COUNTY OF    |                   | § |
|              |                        |  |  |  |  |  |

 

Thisinstrument was acknowledged before me on this           day of                                ,2009, by                                                        ,                                                  of                                                                                   , on behalf of said limited partnership.

 

 
|                   |                          |
|------------------------|-------------------------------|
|                   | NOTARY PUBLIC in and for  the |
|                   | State of                      |   |
| My Commission Expires: | Printed Name of Notary:       |   |
|                   |                          |
|                   |                          |
| Exhibit A         | Leases                        |   |
| Exhibit B         | Real Property                 |   |
|                        |                               |  |  |  |

 

----

 

**EXHIBIT D**

 

**Form ofBlanket Conveyance, Bill of Sale and Assignment**

*(TheVerandah at Meyerland Apartments, Houston, Texas)*

 

THIS BLANKETCONVEYANCE, BILL OF SALE AND ASSIGNMENT is made as of the           day of                         ,2009, by and between **VERANDAH OWNER LIMITEDPARTNERSHIP,**a Delaware limited partnership (“Assignor”), and                                                                      ,a                                             (“Assignee”).

 

W I T N E S S E T H:

 

For good andvaluable consideration, receipt and sufficiency of which are herebyacknowledged Assignor and Assignee hereby****agreeas follows:

 

1.                                       Assignorhereby sells, transfers, assigns and conveys to Assignee the following:

 

a.                                       Allright, title and interest of Assignor in and to all equipment, fixtures, appliances, inventory, and other personalproperty of whatever kind or character owned by Assignor and attached to orinstalled or located on or in the Land or the Improvements (defined below),including, without limitation, furniture, furnishings, drapes and floorcoverings, office equipment and supplies, heating, lighting, refrigeration,plumbing, ventilating, incinerating, cooking, laundry, communication,electrical, dishwashing, and air conditioning equipment, disposals, windowscreens, storm windows, recreational equipment, pool equipment, patiofurniture, sprinklers, hoses, tools and lawn equipment, and specificallyincluding, without limitation, the items listed on Exhibit Battached hereto to the extent attachedto or installed or located on or in the Land or the Improvements (definedbelow)  (the “Personal Property”).  As used herein, the term “Land” shallmean the land situated in Harris County, Texas, more particularly described in Exhibit Aattached hereto (the “Land”), and the term “Improvements” shallmean the all structures, fixtures, buildings, and improvements situated on theLand.

 

b.                                      All right, title, and interest of Assignor inand to those contracts and agreements described on Exhibit Cattached hereto (collectively, the “Service Contracts”).

 

c.                                       All right, title and interest of Assignor inand to (i) all transferable permits, licenses, approvals, utility rights,development rights and similar rights related to the Property, if any, whethergranted by governmental authorities or private persons, (ii) alltrademarks, trade names, or symbols under which the Land or the Improvements(or any part thereof) is operated including, without limitation, the name of “TheVerandah at Meyerland” and the Internet domain name “                                              ,”(iii) all telephone numbers serving the Apartment Development (as definedin the Purchase Agreement), and (iv) all of the right, title, and interestin and to all site plans, surveys, soil and substrata studies, architecturaldrawings, plans and specifications, engineering plans and studies, floor plans,landscape plans and other plans or studies of any kind that relate to the Land,the Improvements or the Personal Property in the possession of or under thecontrol of Assignor (collectively, the “Intangibles”), provided that anycost to assign or transfer any of the Intangibles shall be paid by Assignee.

 

2.                                       ThisBlanket Conveyance, Bill of Sale and Assignment is given pursuant to thatcertain Sale, Purchase and Escrow Agreement dated                                byand between Assignor and Assignee (the “Purchase Agreement”), providingfor, among other things, the conveyance of the Personal Property, 

 

----

 

the Service Contracts,and the Intangibles.

 

3.                                       Consistentwith the Purchase Agreement, which is hereby incorporated by reference, theproperty conveyed hereunder is conveyed by Assignor and accepted by Assignee **AS IS, WHERE IS, AND WITHOUT ANY WARRANTIES OFWHATSOEVER NATURE, EXPRESS OR IMPLIED, EXCEPT AS EXPRESSLY SET FORTH IN THEPURCHASE AGREEMENT, IT BEING THE INTENTION OF ASSIGNOR AND ASSIGNEE EXPRESSLYTO NEGATE AND EXCLUDE ALL WARRANTIES, INCLUDING, WITHOUT LIMITATION, THEIMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR ANY PARTICULAR PURPOSE,WARRANTIES CREATED BY ANY AFFIRMATION OF FACT OR PROMISE OR BY ANY DESCRIPTIONOF THE PROPERTY CONVEYED HEREUNDER, OR BY ANY SAMPLE OR MODEL THEREOF, AND ALLOTHER WARRANTIES WHATSOEVER CONTAINED IN OR CREATED BY THE STATE OF TEXAS UNIFORM COMMERCIALCODE.**

 

4.                                       Assigneehereby accepts the assignment of the Personal Property, the Service Contracts,and the Intangibles Personal Property and agrees to assume and discharge, inaccordance with the terms thereof, all of the obligations thereunder accruingand applicable to the period from and after the date hereof.

 

5.                                       Assigneeagrees to indemnify and hold harmless Assignor from any cost, liability, damageor expense (including attorneys’ fees) arising out of or relating to Assignee’sfailure to perform any of the foregoing obligations arising from and accruingon or after the date hereof.

 

6.                                       Assignoragrees to indemnify and hold harmless Assignee from any cost, liability, damageor expense (including attorneys’ fees) arising out of or relating to Assignor’sfailure to perform any of the obligations of Assignor under the ServiceContracts or the Intangibles, to the extent accruing prior to the date hereof.

 

7.                                       ThisBlanket Conveyance, Bill of Sale and Assignment may be executed in any numberof counterparts, each of which shall be deemed an original, but all of whichshall constitute one and the same instrument.

 

**[Signature pages immediatelyfollow.]**

 

----

 

IN WITNESSWHEREOF, the parties hereto have executed this Blanket Conveyance, Bill of Saleand Assignment as of the date first above written.

 
| ** ** | **ASSIGNOR**:                                                            |
|------------|--------------------------------------------------------------------------|
|       |                                                                     |
|       | **VERANDAH OWNER LIMITED  PARTNERSHIP,**  a Delaware limited partnership |
|       |                                                                     |
|       | By:                                                                      | Houston Verandah Investor Limited Partnership, a  Delaware limited partnership, its general partner |
|       |                                                                     |   |
|       |                                                                     | By: | BH Verandah, L.L.C., an Iowa limited liability  company, its general partner |
|       |                                                                     |   |   |
|       |                                                                     |   | By: | BH Equities L.L.C., an Iowa limited liability  company, its managing member |
|       |                                                                     |   |   |   |
|       |                                                                     |   |   | By: |   |
|       |                                                                     | Name: Harry Bookey |
|       |                                                                     | Title: Manager |

 

 
| ** ** | **ASSIGNEE:** |
|------------|---------------|
| ** ** | ** **    |
| ** ** | ** **    |
|       |          |
|       | By:           |   |
|       |          |   |
|       |          |   |
|       |          | By: |   |
|       |          | Name: |
|       |          | Title: |

 

----

 

**EXHIBIT E**

 

**IntentionallyDeleted**

 

----

 

**EXHIBIT F**

 

**ServiceContracts**

 

----

 

**EXHIBIT G**

 

**Form ofNotice to Tenants**

 
|   | , 20   |   |   |
|--------|--------|--------|--------|
|   |   |   |
|   |   |
|   |   |
|   |   |
|   |   |   |
|   |   |   |
| Re:    |   |   |
|   |   |   |
|        |        |        |        |  |  |  |

 

Dear Tenant:

 

Please be advised thateffective __________________, 20___, ____________________________ has sold theabove-referenced property to _________________________________. Your securitydeposit has been transferred to such entity and such entity shall beresponsible for holding the same in accordance with the terms of your lease. Effective___________, 20___, all future rental payments should be sent to the followingaddress:

 
|                                                                                        |   |   |
|---------------------------------------------------------------------------------------------|--------|--------|
|                                                                                        |   |   |
|                                                                                        |   |   |
|                                                                                        |   |   |
| Any questions regarding  maintenance and management of the property should be addressed to: |
|                                                                                        |   |   |
|                                                                                        |   |   |
|                                                                                        |   |   |
|                                                                                        |   |   |

 

----

 
|   | Very truly yours,                                                   |
|--------|---------------------------------------------------------------------|
|   |                                                                |
|   | VERANDAH OWNER LIMITED PARTNERSHIP, a Delaware  limited partnership |
|   |                                                                |
|   | By:                                                                 | Houston Verandah Investor Limited Partnership, a  Delaware limited partnership, its general partner |
|   |                                                                |   |
|   |                                                                | By: | BH Verandah, L.L.C., an Iowa limited liability  company, its general partner |
|   |                                                                |   |   |
|   |                                                                |   | By: | BH Equities L.L.C., an Iowa limited liability  company, its managing member |
|   |                                                                |   |   |   |
|   |                                                                |   |   | By: |   |
|   |                                                                |   |   |   | Name: Harry Bookey |
|   |                                                                |   |   |   | Title: Manager |

 

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**EXHIBIT H**

 

**FIRPTAAffidavit**

**Transferor’sCertification of Non-Foreign Status**

 

To inform **[PURCHASER ENTITY]**,a                                    (“**Transferee**”), that withholding oftax under Section 1445 of the Internal Revenue Code of 1986, as amended(the “**Code**”), will not be required upon thetransfer of certain real property to Transferee by Verandah Owner LimitedPartnership, a Delaware limited partnership (“**Transferor**”),the undersigned hereby certifies the following on behalf of Transferor:

 

1.                                       Transferoris not a foreign corporation, foreign partnership, foreign trust or foreignestate (as those terms are defined in the Code and the Income Tax Regulationspromulgated thereunder);

 

2.                                       Selleris not a disregarded entity as defined in §1.1445-2(b)(2)(iii);

 

3.                                       Transferor’sU.S. employer identification number is                    ;and

 

4.                                       Transferor’soffice address is c/o **BH Equities, L.L.C. 400Locust Street, Suite 790, Des Moines, Iowa 50309, Attn: Nicholas Roby, Esq.**

 

Transferor understands that this Certification may bedisclosed to the Internal Revenue Service by Transferee and that any falsestatement contained herein could be punished by fine, imprisonment, or both.

 

Under penalty of perjury I declare that I haveexamined this Certification and to the best of my knowledge and belief it istrue, correct and complete, and I further declare that I have authority to signthis document on behalf of Transferor.

 

----

 

Dated:                             ,20

 
|   | VERANDAH OWNER LIMITED PARTNERSHIP, a Delaware  limited partnership |
|--------|---------------------------------------------------------------------|
|   |                                                                |
|   | By:                                                                 | Houston Verandah Investor Limited Partnership, a  Delaware limited partnership, its general partner |
|   |                                                                |   |
|   |                                                                | By: | BH Verandah, L.L.C., an Iowa limited liability company,  its general partner |
|   |                                                                |   |   |
|   |                                                                |   | By: | BH Equities L.L.C., an Iowa limited liability  company, its managing member |
|   |                                                                |   |   |   |
|   |                                                                |   |   |   |
|   |                                                                |   |   | By: |   |
|   |                                                                |   |   |   | Name: Harry Bookey |
|   |                                                                |   |   |   | Title: Manager |

 

----

 

**EXHIBIT I**

 

**Form ofSpecial Warranty Deed**

 
| THE STATE OF TEXAS |   | § |
|--------------------|--------|--------|
|               |   | § | KNOW ALL MEN BY THESE  PRESENTS THAT: |
| COUNTY OF HARRIS   |   | § |

 

VERANDAH OWNER LIMITED PARTNERSHIP, a Delaware limited partnership(whether one or more, “Grantor”), for and in consideration of the sum of TENAND NO/100 DOLLARS ($10.00), and other good and valuable consideration paid by                                  ,a                                 (the “Grantee”), the receipt and sufficiency of which are hereby acknowledgedand confessed, subject to the exceptions, liens, encumbrances, terms andprovisions hereinafter set forth and described, has GRANTED, BARGAINED, SOLDand CONVEYED, and by these presents does hereby GRANT, BARGAIN, SELL andCONVEY, unto Grantee all of that certain lot, tract or parcel of land situatedin Harris County, Texas, and being more particularly described in Exhibit “A”attached hereto and incorporated herein by reference for all purposes.

 

TOGETHER WITH, all and singular, the rights, benefits, privileges,easements, tenements, hereditaments, appurtenances and interests thereon or inanywise appertaining thereto and with all improvements located thereonbelonging to Grantor (said land, rights, benefits, privileges, easements,tenements, hereditaments, appurtenances, improvements and interests beinghereinafter referred to as the “Property”).

 

For the same consideration recited above, Grantor hereby BARGAINS,SELLS and TRANSFERS, without warranty, express or implied, all interest, ifany, of Grantor in (i) strips or gores, if any, between the Property andabutting or immediately adjacent properties, and (ii) any land lying in orunder the bed of any street, alley, road or right-of-way, opened or proposed,abutting or immediately adjacent to the Property.

 

This conveyance is made subject and subordinate to the encumbrances andexceptions (“Permitted Exceptions”) described in Exhibit “B”attached hereto and incorporated herein by reference for all purposes, but onlyto the extent they affect or relate to the Property.

 

**ALL GRANTS, BARGAINS, SALES AND TRANSFERS ARE MADE“AS—IS, WITHOUT REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, EXCEPT AS SETFORTH IN THE DEED AND IN ARTICLE XI OF THAT CERTAIN SALE, PURCHASE AND ESCROWAGREEMENT DATED                    ,2009 (THE “SALE AGREEMENT”), BY AND BETWEEN GRANTOR, AS SELLER, AND HARVARD PROPERTYTRUST, LLC, AS PURCHASER, WHOSE RIGHTS THEREUNDER HAVE BEEN ASSIGNED TOGRANTEE, WITHOUT WARRANTY OF HABITABILITY, SUITABILITY, MERCHANTIBILITY FORFITNESS FOR A PARTICULAR PURPOSE, WITH NO RELIANCE OF ANY BUYER ON ANYREPRESENATION WITH RESPECT TO PROPERTY CONDITION EXCEPT AS DESCRIBED ABOVE WITHRESPECT TO THE SALE AGREEMENT, AND WITH KNOWLEDGE THAT**

 

----

 

**ANY BUYER IS INSTEAD RELYING ON ITS OWNEXAMINATION OF THE PROPERTY.**

 

**At no time prior to January 1, 2015 shall allor any portion of the Property be established as a condominium regime under thelaws of the State of Texas unless the then current owner of the Property (the “Owner”)(i) shall have given written notice to Grantor and Verandah IH 610, L.P.of Owner’s intention to file such condominium declaration and establish all orany portion of the Property as a condominium regime and (ii) shall have,at least sixty (60) days prior to the recordation of a condominium declarationcovering the Property, recorded in the Official Public Records of Real Propertyof Harris County, Texas an affidavit, in the form attached hereto as Exhibit “C,”swearing that such notice was properly given. If Owner fails to timely file theaffidavit prior to recording any such condominium declaration as providedherein, then such condominium declaration shall be null and void *ab**initio*.However, if the affidavit is timely filed as provided herein, all subsequentpurchasers may rely on the affidavit as conclusive proof that the notice wasproperly given, and the condominium declaration shall be fully effective andwill not be void or voidable for failure to have properly given such notice. Thenotice required hereunder shall be delivered to Grantor and Verandah IH 610,L.P. by United States Mail, as a certified item with postage prepaid and returnreceipt requested, addressed as follows:**

 

**VerandahOwner Limited Partnershipc/o BlackRock Realty Advisors, Inc.****300 Campus Drive, 3****rd Floor, FlorhamPark, New Jersey 07932****Attention: Jeremy Litt, Esq.**

 

**with a copy to**

 

**GoodwinProcter****LLP****Exchange Place****Boston, Massachusetts 02109****Attention: Lawrence R. Cahill, Esq.**

 

**and**

 

**VerandahIH 610, L.P.**

**c/oVerandah Development, Inc.**

**8588 KatyFreeway, Suite 230**

**Houston,Texas 77024**

 

**with acopy to**

 

**J. RobertFisher**

**WinsteadSechrest & Minick P.C.**

**910Travis Street, Suite 2400**

**Houston,Texas 77002**

 

----

 

TO HAVE AND TO HOLD theProperty, subject to the Permitted Exceptions as aforesaid, unto Grantee, andGrantee’s successors and assigns, forever; and Grantor does hereby bindGrantor, and Grantor’s successors and assigns, to WARRANT and FOREVER DEFEND,all and singular, the Property, subject to the Permitted Exceptions, untoGrantee, and Grantee’s successors and assigns, against every person whomsoeverlawfully claiming or to claim the same or any part thereof, by, through orunder Grantor, but not otherwise.

 

Grantee, by its acceptance hereof, does hereby assume and agree to payany and all ad valorem taxes and special assessments pertaining to the Propertyfor calendar year 2009 and subsequent years, there having been a properproration of ad valorem taxes for the current calendar year between Grantor andGrantee.

 

[*Remainder of page left intentionally blank*]

 

----

 

EXECUTED as of the             day of                                  ,200

 

 
|   | GRANTOR:                                                            |
|--------|---------------------------------------------------------------------|
|   |                                                                |
|   | VERANDAH OWNER LIMITED PARTNERSHIP, a Delaware  limited partnership |
|   |                                                                |
|   | By:                                                                 | Houston Verandah Investor Limited Partnership, a  Delaware limited partnership, its general partner |
|   |                                                                |   |
|   |                                                                | By: | BH Verandah, L.L.C., an Iowa limited liability  company, its general partner |
|   |                                                                |   |   |   |
|   |                                                                |   | By: | BH Equities L.L.C., an Iowa limited liability  company, its managing member |
|   |                                                                |   |   |   |
|   |                                                                |   |   | By: |   |
|   |                                                                |   |   |   | Name: Harry Bookey |
|   |                                                                |   |   |   | Title: Manager |

 

 
| THE STATE OF |   |   | § |
|--------------|--------|--------|--------|
|         |   |   | § |
| COUNTY OF    |   |   | § |
|              |        |        |        |  |

 

Thisinstrument was acknowledged before me on this           day of                              ,2009, by Harry Bookey, the Manager of BH Equities L.L.C., an Iowa limitedliability company, the managing member of BH Verandah, L.L.C., an Iowa limitedliability company, the general partner of Houston Verandah Investor LimitedPartnership, a Delaware limited partnership, the general partner of VerandahOwner Limited Partnership, a Delaware limited partnership, on behalf of saidlimited liability company and limited partnership.

 

 
|                   |                          |
|------------------------|-------------------------------|
|                   | NOTARY PUBLIC in and for  the |
|                   | State of                      |   |
| My Commission Expires: | Printed Name of Notary:       |   |
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GRANTEE’S ADDRESS FOR TAXNOTICES:

 
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| When recorded, return  to: |
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| List of  Exhibits: |   |                  |
|--------------------|--------|-----------------------|
|               |   |                  |
| Exhibit A     | — | Property  Description |
| Exhibit B     | — | Permitted  Exceptions |
| Exhibit C     | — | Affidavit             |

 

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**EXHIBIT “A” TO SPECIAL WARRANTY DEED**

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**PROPERTY DESCRIPTION**

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Being a tract or parcel containing 5.313 acres(231,427 square feet) of land situated in the James D. Owen Survey, AbstractNumber 612; being out of and a part of Unrestricted Block 7, of MEYER PARK, SECTION 2,a subdivision plat of record in Volume 142, Page 30, Harris County MapRecords; and being out of and a part of that certain tract of land (Tract One)conveyed to Aramco Services Company as described in deed recorded under HarrisCounty Clerk’s File (H.C.C.F.) Number H104446, Harris County, Texas; and beingthat certain called 5.313 acre tract conveyed to Verandah IH-610, L.P. asdescribed in deed recorded under H.C.C.F. number W636306; and said 5.313 acretract being more particularly described by metes and bounds as follows(bearings are oriented to said record plat):

 

BEGINNING at 1-inch iron rod found in the northright-of-way (R.O.W.) line of Braeswood Boulevard (100 feet wide) and markingthe most southerly southwest corner of the aforesaid Block 7 and the hereindescribed tract;

 

THENCE, North 06°18’24” West, along a southwest lineof said Block 7, a distance of 150.00 feet to an interior corner of said Blockand the herein described tract, from which a found 1-inch iron rod bears South 60°43’West, 0.26 feet;

 

THENCE, South 71°35’50” West, along a southwest lineof said Block 7, a distance of 150.00 feet to the curved east R.O.W. line ofInterstate Highway 610 (West Loop South) (Width Varies) for the most westerlysouthwest corner of said Block 7 and the herein described tract and for a pointof tangency of a non-tangent curve to the right, from which a found 1-inch ironrod bears North 66°35’ West, 0.36 feet;

 

THENCE, Northerly, an arc distance of 288.32 feetalong said east R.O.W. line and the west line of said Block 7 and along saidcurve to the right, having a central angle of 01°26’45”, a radius of 11,425.80feet and a chord which bears North 05°14’26” West, 288.31 feet to a 5/8-inchiron rod with plastic cap stamped “Terra Surveying” set marking the northwestcorner of the herein described tract;

 

THENCE, departing said east R.O.W. line and over andacross the aforesaid Aramco Services Company tract, the following courses anddistances:

 

North 89°49’01” East, a distance of 86.98 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

South 45°41’49” East, a distance of 14.27 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

North 89°49’01” East, a distance of 34.78 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

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North 44°49’01” East, a distance of 14.14 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

North 89°49’01” East, a distance of 215.65 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

North 44°49’01” East, a distance of 52.57 feet to an “X” set inconcrete for an interior corner of the herein described tract;

 

North 89°49’01” East, a distance of 396.89 feet to “X” set in concreteset in the curved west R.O.W. line of Meyer Park Drive (60 feet wide) and theeast line of the aforesaid Block 7 and marking a point of curvature of anon-tangent curve to the left and the northeast corner of the herein describedtract;

 

THENCE, Southerly, an arc distance of 170.01 feetalong said west R.O.W. line and the east line of said Block 7 and along saidcurve to the left, having a central angle of 10°49’14”, a radius of 900.22 feetand a chord which bears South 16°02’49” East, 169.76 feet to the most northerlyend of a cutback-line for the most easterly southeast corner of said Block 7and the herein described tract, from which a found 5/8-inch iron rod bearsSouth 05°53’ East, 0.17 feet;

 

THENCE, South 23°32’34” West, along said cutback-line,a distance of 14.16 feet to the aforesaid north R.O.W. line of BraeswoodBoulevard for the most southerly southeast corner of said Block 7 and theherein described tract, from which a found 5/8-inch iron rod bears South 16°31’East, 0.65 feet;

 

THENCE, South 68°32’34” West, along the common line ofsaid north R.O.W. line and the south line of said Block 7, a distance of 435.95feet to a point of curvature of a tangent curve to the right, from which afound 5/8-inch iron rod bears South 19°40’ West, 0.22 feet;

 

THENCE, Southwesterly, an arc distance of 107.06 feetcontinuing along said common line and said curve to the right, having a centralangle of 01°04’14”, a radius of 5,730.00 feet and a chord which bears South69°04’41” West, 107.06 feet to a point of reverse curvature for a tangent curveto the left, from which a found 5/8-inch iron rod bears South 62°55’ West, 0.20feet;

 

THENCE, Southwesterly, an arc distance of 107.06 feetcontinuing along said common line and said curve to the left, having a centralangle, of 01°04’14”, a radius of 5,730.00 feet and a chord which bears South69°04’41” West, 107.06 feet to a point of tangency, from which a found 5/8-inchiron rod bears South 09°03’ East, 0.55 feet;

 

THENCE, South 68°32’34” West, continuing along saidcommon line, a distance of 45.05 feet to the POINT OF BEGINNING and containing5.313 acres (231,427 square feet) of land. This description is based on the Land Title Survey and plat made byTerra Surveying Company, Inc., dated July 1, 2002, latest revisiondated April 27, 2005.  TSC ProjectNumber 0038-0101-S.

 

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**EXHIBIT “B” TO SPECIAL WARRANTY DEED**

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**PERMITTED EXCEPTIONS**

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**EXHIBIT “C” TO SPECIAL WARRANTY DEED**

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**AFFIDAVIT**

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| STATE OF TEXAS   |   | § |
|------------------|--------|--------|
|             |   | § |
| COUNTY OF HARRIS |   | § |

 

**AFFIDAVIT**

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**NOTICE OF CONFIDENTIALITY RIGHTS:IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OF THE FOLLOWINGINFORMATION FROM THIS  INSTRUMENT BEFOREIT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER ORYOUR DRIVER’S LICENSE NUMBER.**

 

This Affidavit is executed as of the         day of                              ,20       by                                              ,who, after being duly sworn by the undersigned notary public, upon (his/her)oath did depose and say as follows:

 

My name is                                                                        ,I am over the age of 21 years, have personal knowledge of the facts set forthin this Affidavit and am in all things competent to give this Affidavit.

 

I am the                                      of                                           (“Owner”), the owner of the real property located in Houston, Harris County,Texas (the “Property”).  This Affidavitis given pursuant to the requirements set forth in that certain SpecialWarranty Deed dated                     ,200    ecorded under Clerk’s File No.                                     in the Official Public Records of Real Property of Harris County, Texas (the “Deed”).

 

Owner intends, not sooner that sixty (60) days from the date of therecordation of this Affidavit in the Official Public Records of Real Propertyof Harris County, Texas, to subject all or a part of the Property to adeclaration for the purposes of establishing a condominium regime over all or apart of the Property.

 

Prior to the recordation of this Affidavit Owner, fully in accordancewith the terms of the Deed, gave written notice of its intent to subject all ora part of the Property to a declaration for the purposes of establishing acondominium regime over all or a part of the Property to the grantor under theDeed.  Such written notice was deliveredto such grantor by United States certified mail, as a certified item withpostage paid and return receipt requested, addressed as follows:

 

VerandahOwner Limited Partnershipc/o BlackRock Realty Advisors, Inc.

300Campus Drive, 3rd Floor, Florham Park, New Jersey 07932

Attention:Jeremy Litt, Esq.

 

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with a copy to

 

Goodwin Procter LLP

Exchange Place

Boston,Massachusetts  02109

Attention:  Lawrence R. Cahill, Esq.

 

End of Affidavit

 
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SUBSCRIBED, SWORN TO AND ACKNOWLEDGED by                                            before me this          day of                            ,20      .

 
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|   | Notary  Public in and for the State of |   |

 

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** **

**EXHIBIT “A” TO AFFIDAVIT**

** **

**PROPERTY DESCRIPTION**

** **

Being a tract or parcel containing 5.313 acres(231,427 square feet) of land situated in the James D. Owen Survey, AbstractNumber 612; being out of and a part of Unrestricted Block 7, of MEYER PARK, SECTION 2,a subdivision plat of record in Volume 142, Page 30, Harris County MapRecords; and being out of and a part of that certain tract of land (Tract One)conveyed to Aramco Services Company as described in deed recorded under HarrisCounty Clerk’s File (H.C.C.F.) Number H104446, Harris County, Texas; and beingthat certain called 5.313 acre tract conveyed to Verandah IH-610, L.P. asdescribed in deed recorded under H.C.C.F. number W636306; and said 5.313 acretract being more particularly described by metes and bounds as follows(bearings are oriented to said record plat):

 

BEGINNING at 1-inch iron rod found in the northright-of-way (R.O.W.) line of Braeswood Boulevard (100 feet wide) and markingthe most southerly southwest corner of the aforesaid Block 7 and the hereindescribed tract;

 

THENCE, North 06°18’24” West, along a southwest lineof said Block 7, a distance of 150.00 feet to an interior corner of said Blockand the herein described tract, from which a found 1-inch iron rod bears South60°43’ West, 0.26 feet;

 

THENCE, South 71°35’50” West, along a southwest lineof said Block 7, a distance of 150.00 feet to the curved east R.O.W. line ofInterstate Highway 610 (West Loop South) (Width Varies) for the most westerlysouthwest corner of said Block 7 and the herein described tract and for a pointof tangency of a non-tangent curve to the right, from which a found 1-inch ironrod bears North 66°35’ West, 0.36 feet;

 

THENCE, Northerly, an arc distance of 288.32 feetalong said east R.O.W. line and the west line of said Block 7 and along saidcurve to the right, having a central angle of 01°26’45”, a radius of 11,425.80feet and a chord which bears North 05°14’26” West, 288.31 feet to a 5/8-inchiron rod with plastic cap stamped “Terra Surveying” set marking the northwestcorner of the herein described tract;

 

THENCE, departing said east R.O.W. line and over andacross the aforesaid Aramco Services Company tract, the following courses anddistances:

 

North 89°49’01” East, a distance of 86.98 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

South 45°41’49” East, a distance of 14.27 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

North 89°49’01” East, a distance of 34.78 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

North 44°49’01” East, a distance of 14.14 feet to a 5/8-inch iron rodwith plastic cap stamped 

 

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“Terra Surveying” set for an interior corner of the herein describedtract;

 

North 89°49’01” East, a distance of 215.65 feet to a 5/8-inch iron rodwith plastic cap stamped “Terra Surveying” set for an interior corner of theherein described tract;

 

North 44°49’01” East, a distance of 52.57 feet to an “X” set inconcrete for an interior corner of the herein described tract;

 

North 89°49’01” East, a distance of 396.89 feet to “X” set in concreteset in the curved west R.O.W. line of Meyer Park Drive (60 feet wide) and theeast line of the aforesaid Block 7 and marking a point of curvature of anon-tangent curve to the left and the northeast corner of the herein describedtract;

 

THENCE, Southerly, an arc distance of 170.01 feetalong said west R.O.W. line and the east line of said Block 7 and along saidcurve to the left, having a central angle of 10°49’14”, a radius of 900.22 feetand a chord which bears South 16°02’49” East, 169.76 feet to the most northerlyend of a cutback-line for the most easterly southeast corner of said Block 7and the herein described tract, from which a found 5/8-inch iron rod bearsSouth 05°53’ East, 0.17 feet;

 

THENCE, South 23°32’34” West, along said cutback-line,a distance of 14.16 feet to the aforesaid north R.O.W. line of BraeswoodBoulevard for the most southerly southeast corner of said Block 7 and theherein described tract, from which a found 5/8-inch iron rod bears South 16°31’East, 0.65 feet;

 

THENCE, South 68°32’34” West, along the common line ofsaid north R.O.W. line and the south line of said Block 7, a distance of 435.95feet to a point of curvature of a tangent curve to the right, from which afound 5/8-inch iron rod bears South 19°40’ West, 0.22 feet;

 

THENCE, Southwesterly, an arc distance of 107.06 feetcontinuing along said common line and said curve to the right, having a centralangle of 01°04’14”, a radius of 5,730.00 feet and a chord which bears South69°04’41” West, 107.06 feet to a point of reverse curvature for a tangent curveto the left, from which a found 5/8-inch iron rod bears South 62°55’ West, 0.20feet;

 

THENCE, Southwesterly, an arc distance of 107.06 feetcontinuing along said common line and said curve to the left, having a centralangle, of 01°04’14”, a radius of 5,730.00 feet and a chord which bears South69°04’41” West, 107.06 feet to a point of tangency, from which a found 5/8-inchiron rod bears South 09°03’ East, 0.55 feet;

 

THENCE, South 68°32’34” West, continuing along saidcommon line, a distance of 45.05 feet to the POINT OF BEGINNING and containing5.313 acres (231,427 square feet) of land. This description is based on the Land Title Survey and plat made byTerra Surveying Company, Inc., dated July 1, 2002, latest revisiondated April 27, 2005.  TSC ProjectNumber 0038-0101-S.]

 

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**EXHIBIT J**

 

**Personal Property**

 

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**EXHIBIT K**

 

**Due Diligence Materials**

 

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**EXHIBIT L**

 

**Seller’s Lease Guidelines**

 

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