exv10w5






Exhibit 10.5




GUARANTY OF NON-RECOURSE OBLIGATIONS




     This GUARANTY OF NON-RECOURSE OBLIGATIONS (this “Guaranty”), dated as of June 28, 2011, is
executed by the undersigned (“Guarantor”), to and for the benefit of PNC BANK, NATIONAL
ASSOCIATION, a national banking association (“Lender”).



RECITALS:




     A. Pursuant to that certain Multifamily Loan and Security Agreement dated as of the date
hereof, by and between SIR CLARION PARK, LLC, a Delaware limited liability company (“Borrower”),
and Lender (as amended, restated, replaced, supplemented or otherwise modified from time to time,
the “Loan Agreement”), Lender is making a loan to Borrower in the original principal amount of
Eight Million Nine Hundred Seventy-Two Thousand and 00/100 Dollars ($8,972,000.00) (the “Mortgage
Loan”), as evidenced by that certain Multifamily Note dated as of the date hereof, executed by
Borrower and made payable to the order of Lender in the amount of the Mortgage Loan (as amended,
restated, replaced, supplemented or otherwise modified from time to time, the “Note”).



     B. The Note will be secured by, among other things, a Security Instrument (as defined in the
Loan Agreement) encumbering the real property described in the Security Instrument (the
“Property”).



     C. Guarantor has an economic interest in Borrower or will otherwise obtain a material
financial benefit from the Mortgage Loan.



     D. As a condition to making the Mortgage Loan to Borrower, Lender requires that Guarantor
execute this Guaranty.



     NOW, THEREFORE, in order to induce Lender to make the Mortgage Loan to Borrower, and in
consideration thereof, Guarantor agrees as follows:



AGREEMENTS:




1. Recitals.




     The recitals set forth above are incorporated herein by reference as if fully set forth in the
body of this Guaranty.



2. Defined Terms.




     Capitalized terms used and not specifically defined herein have the meanings given to such
terms in the Loan Agreement.



					
	 	 	 	 	 
	Guaranty of Non-Recourse Obligations
	 	Form 6015
	 	Page 1
	Fannie Mae
	 	04-11
	 	© 2011 Fannie Mae
















 






3. Guaranteed Obligations.




     Guarantor hereby absolutely, unconditionally and irrevocably guarantees to Lender the full and
prompt payment and performance when due, whether at maturity or earlier, by reason of acceleration
or otherwise, and at all times thereafter, of:



     (a) all amounts, obligations and liabilities owed to Lender under Article 3 (Personal
Liability) of the Loan Agreement (including the payment and performance of all indemnity
obligations of Borrower described in Section 3.03 (Personal Liability for Indemnity Obligations) of
the Loan Agreement and including all of Borrower’s obligations under the Environmental Indemnity
Agreement); and



     (b) all costs and expenses, including reasonable fees and out-of-pocket expenses of attorneys
and expert witnesses, incurred by Lender in enforcing its rights under this Guaranty.



4. Survival of Guaranteed Obligations.




     The obligations of Guarantor under this Guaranty shall survive any Foreclosure Event, and any
recorded release or reconveyance of the Security Instrument or any release of any other security
for any of the Indebtedness; provided, however, that notwithstanding anything to the contrary
herein, Guarantor’s liability to Lender shall not include any loss, liability or expense arising or
occurring from and after the date of the Foreclosure Event which relates to actions or omissions of
Lender or any future assignee or holder of the Note occurring after such Foreclosure Event.



5. Guaranty of Payment; Community Property.




     Guarantor’s obligations under this Guaranty constitute a present and unconditional guaranty of
payment and not merely a guaranty of collection. If Guarantor (or any Guarantor, if more than one)
is a married person, and the state of residence of Guarantor or Guarantor’s spouse is a community
property jurisdiction, Guarantor (or each such married Guarantor, if more than one) agrees that
Lender may satisfy Guarantor’s obligations under this Guaranty to the extent of all Guarantor’s
separate property and Guarantor’s interest in any community property.



6. Obligations Unsecured; Cross-Default.




     The obligations of Guarantor under this Guaranty shall not be secured by the Security
Instrument or the Loan Agreement. However, a default under this Guaranty shall be an Event of
Default under the Loan Agreement, and a default under this Guaranty shall entitle Lender to be able
to exercise all of its rights and remedies under the Loan Agreement and other Loan Documents.



7. Continuing Guaranty.




     The obligations of Guarantor under this Guaranty shall be unconditional irrespective of the
genuineness, validity, regularity or enforceability of any provision of this Guaranty, the Note,



					
	 	 	 	 	 
	Guaranty of Non-Recourse Obligations
	 	Form 6015
	 	Page 2
	Fannie Mae
	 	04-11
	 	© 2011 Fannie Mae
















 





the Loan Agreement, the Security Instrument or any other Loan Document. Guarantor agrees that
performance of the obligations hereunder shall be a primary obligation, shall not be subject to any
counterclaim, set-off, recoupment, abatement, deferment or defense based upon any claim that
Guarantor may have against Lender, Borrower, any other guarantor of the obligations hereunder or
any other person or entity, and shall remain in full force and effect without regard to, and shall
not be released, discharged or affected in any way by any circumstance or condition (whether or not
Guarantor shall have any knowledge thereof), including:




     (a) any furnishing, exchange, substitution or release of any collateral securing repayment of
the Mortgage Loan, or any failure to perfect any lien in such collateral;



     (b) any failure, omission or delay on the part of Borrower, Guarantor, any other guarantor of
the obligations hereunder or Lender to conform or comply with any term of any of the Loan Documents
or failure of Lender to give notice of any Event of Default;



     (c) any action or inaction by Lender under or in respect of any of the Loan Documents, any
failure, lack of diligence, omission or delay on the part of Lender to perfect, enforce, assert or
exercise any lien, security interest, right, power or remedy conferred upon it in any of the Loan
Documents, or any other action or inaction on the part of Lender;



     (d) any Bankruptcy Event, or any voluntary or involuntary bankruptcy, insolvency,
reorganization, arrangement, readjustment, assignment for the benefit of creditors, composition,
receivership, liquidation, marshaling of assets and liabilities or similar events or proceedings
with respect to Guarantor or any other guarantor of the obligations hereunder, or any of their
respective property or creditors or any action taken by any trustee or receiver or by any court in
such proceeding;



     (e) any merger or consolidation of Borrower into or with any entity or any sale, lease or
Transfer of any asset of Borrower, Guarantor or any other guarantor of the obligations hereunder to
any other Person;



     (f) any change in the ownership of Borrower or any change in the relationship between
Borrower, Guarantor or any other guarantor of the obligations hereunder, or any termination of such
relationship;



     (g) any release or discharge by operation of law of Borrower, Guarantor or any other guarantor
of the obligations hereunder, any obligation or agreement contained in any of the Loan Documents;
or



     (h) any other occurrence, circumstance, happening or event, whether similar or dissimilar to
the foregoing, and whether seen or unforeseen, which otherwise might constitute a legal or
equitable defense or discharge of the liabilities of a guarantor or surety or which otherwise might
limit recourse against Borrower or Guarantor to the fullest extent permitted by law.



					
	 	 	 	 	 
	Guaranty of Non-Recourse Obligations
	 	Form 6015
	 	Page 3
	Fannie Mae
	 	04-11
	 	© 2011 Fannie Mae
















 






8. Guarantor Waivers.




     Guarantor hereby waives:



     (a) the benefit of all principles or provisions of law, statutory or otherwise, which are or
might be in conflict with the terms of this Guaranty (and agrees that Guarantor’s obligations shall
not be affected by any circumstances, whether or not referred to in this Guaranty, which might
otherwise constitute a legal or equitable discharge of a surety or a guarantor);



     (b) the benefits of any right of discharge under any and all statutes or other laws relating
to guarantors or sureties and any other rights of sureties and guarantors;



     (c) diligence in collecting the Indebtedness, presentment, demand for payment, protest and all
notices with respect to the Loan Documents and this Guaranty which may be required by statute, rule
of law or otherwise to preserve Lender’s rights against Guarantor under this Guaranty, including
notice of acceptance, notice of any amendment of the Loan Documents, notice of the occurrence of
any default or Event of Default, notice of intent to accelerate, notice of acceleration, notice of
dishonor, notice of foreclosure, notice of protest and notice of the incurring by Borrower of any
obligation or indebtedness; and



     (d) all rights to require Lender to:




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




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




     (3) demand or require collateral security from Borrower, any other guarantor or any
other Person as provided by applicable law or otherwise.


9. No Effect Upon Obligations.




     At any time or from time to time and any number of times, without notice to Guarantor and
without releasing, discharging or affecting the liability of Guarantor:



     (a) the time for payment of the principal of or interest on the Indebtedness may be extended
or the Indebtedness may be renewed in whole or in part;



     (b) the rate of interest on or period of amortization of the Mortgage Loan or the amount of
the Monthly Debt Service Payments payable under the Loan Documents may be modified;



     (c) the time for Borrower’s performance of or compliance with any covenant or agreement
contained in any Loan Document, whether presently existing or hereinafter entered into, may be
extended or such performance or compliance may be waived;



					
	 	 	 	 	 
	Guaranty of Non-Recourse Obligations
	 	Form 6015
	 	Page 4
	Fannie Mae
	 	04-11
	 	© 2011 Fannie Mae
















 






     (d) the maturity of the Indebtedness may be accelerated as provided in the Loan Documents;



     (e) any or all payments due under the Loan Agreement or any other Loan Document may be
reduced;



     (f) any Loan Document may be modified or amended by Lender and Borrower in any respect,
including an increase in the principal amount of the Mortgage Loan;



     (g) any amounts under the Loan Agreement or any other Loan Document may be released;



     (h) any security for the Indebtedness may be modified, exchanged, released, surrendered or
otherwise dealt with or additional security may be pledged or mortgaged for the Indebtedness;



     (i) the payment of the Indebtedness or any security for the Indebtedness, or both, may be
subordinated to the right to payment or the security, or both, of any other present or future
creditor of Borrower;



     (j) any payments made by Borrower to Lender may be applied to the Indebtedness in such
priority as Lender may determine in its discretion; and



     (k) any other terms of the Loan Documents may be modified as required by Lender.



10. Joint and Several (or Solidary) Liability.




     If more than one Person executes this Guaranty as Guarantor, such Persons shall be liable for
the obligations hereunder on a joint and several (solidary instead for purposes of Louisiana law)
basis. Lender, in its discretion, may:



     (a) to the extent permitted by applicable law, bring suit against Guarantor, or any one or
more of the Persons constituting Guarantor, and any other guarantor, jointly and severally
(solidarily instead for purposes of Louisiana law), or against any one or more of them;



     (b) compromise or settle with any one or more of the Persons constituting Guarantor, or any
other guarantor, for such consideration as Lender may deem proper;



     (c) discharge or release one or more of the Persons constituting Guarantor, or any other
guarantor, from liability or agree not to sue such Person; and



     (d) otherwise deal with Guarantor and any guarantor, or any one or more of them, in any
manner, and no such action shall impair the rights of Lender to collect from Guarantor any amount
guaranteed by Guarantor under this Guaranty.


Nothing contained in this Section 10 shall in any way affect or impair the rights or obligations of
Guarantor with respect to any other guarantor.




					
	 	 	 	 	 
	Guaranty of Non-Recourse Obligations
	 	Form 6015
	 	Page 5
	Fannie Mae
	 	04-11
	 	© 2011 Fannie Mae
















 






11. Subordination of Affiliated Debt.




     Any indebtedness of Borrower held by Guarantor now or in the future is and shall be
subordinated to the Indebtedness and any such indebtedness of Borrower shall be collected, enforced
and received by Guarantor, as trustee for Lender, but without reducing or affecting in any manner
the liability of Guarantor under the other provisions of this Guaranty.



12. Subrogation.




     Guarantor shall have no right of, and hereby waives any claim for, subrogation or
reimbursement against Borrower or any general partner of Borrower by reason of any payment by
Guarantor under this Guaranty, whether such right or claim arises at law or in equity or under any
contract or statute, until the Indebtedness has been paid in full and there has expired the maximum
possible period thereafter during which any payment made by Borrower to Lender with respect to the
Indebtedness could be deemed a preference under the Insolvency Laws.



13. Voidable Transfer.




     If any payment by Borrower is held to constitute a preference under any Insolvency Laws or
similar laws, or if for any other reason Lender is required to refund any sums to Borrower, such
refund shall not constitute a release of any liability of Guarantor under this Guaranty. It is the
intention of Lender and Guarantor that Guarantor’s obligations under this Guaranty shall not be
discharged except by Guarantor’s performance of such obligations and then only to the extent of
such performance. If any payment by any Guarantor should for any reason subsequently be declared
to be void or voidable under any state or federal law relating to creditors’ rights, including
provisions of the Insolvency Laws relating to a Voidable Transfer, and if Lender is required to
repay or restore, in whole or in part, any such Voidable Transfer, or elects to do so upon the
advice of its counsel, then the obligations guaranteed hereunder shall automatically be revived,
reinstated and restored by the amount of such Voidable Transfer or the amount of such Voidable
Transfer that Lender is required or elects to repay or restore, including all reasonable costs,
expenses and legal fees incurred by Lender in connection therewith, and shall exist as though such
Voidable Transfer had never been made, and any other guarantor, if any, shall remain liable for
such obligations in full.



14. Credit Report/Credit Score.




     Guarantor acknowledges and agrees that Lender is authorized, no more frequently than once in
any twelve (12) month period, to obtain a credit report (if applicable) on Guarantor, the cost of
which shall be paid for by Guarantor. Guarantor acknowledges and agrees that Lender is authorized
to obtain a Credit Score (if applicable) for Guarantor at any time at Lender’s expense.



15. Financial Reporting.




     Guarantor shall deliver to Lender such Guarantor financial statements as required by Section
8.02 (Books and Records; Financial Reporting — Covenants) of the Loan Agreement.



					
	 	 	 	 	 
	Guaranty of Non-Recourse Obligations
	 	Form 6015
	 	Page 6
	Fannie Mae
	 	04-11
	 	© 2011 Fannie Mae
















 






16. Further Assurances.




     Guarantor acknowledges that Lender (including its successors and assigns) may sell or transfer
the Mortgage Loan, or any interest in the Mortgage Loan.



     (a) Guarantor shall:




     (1) do anything necessary to comply with the requirements of Lender or any Investor of
the Mortgage Loan or provide, or cause to be provided, to Lender or any Investor of the
Mortgage Loan, at Borrower’s and Guarantor’s cost and expense, such further documentation or
information required by Lender or Investor, in order to enable:




     (A) Lender to sell the Mortgage Loan to such Investor;




     (B) Lender to obtain a refund of any commitment fee from any such Investor; or




     (C) any such Investor to further sell or securitize the Mortgage Loan;




     (2) confirm that Guarantor is not in default under this Guaranty or in observing any of
the covenants or agreements contained in this Guaranty (or, if Guarantor is in default,
describing such default in reasonable detail); and




     (3) execute and deliver to Lender and/or any Investor such other documentation,
including any amendments, corrections, deletions or additions to this Guaranty as is
required by Lender or such Investor.



     (b) Nothing in this Section 16 shall require Guarantor to do any further act that has the
effect of:




     (1) changing the essential economic terms of the Mortgage Loan set forth in the related
commitment letter between Borrower and Lender; or




     (2) imposing on Borrower or Guarantor greater personal liability under the Loan
Documents than that set forth in the related commitment letter between Borrower and Lender.



17. Successors and Assigns.




     Lender may assign its rights under this Guaranty in whole or in part and, upon any such
assignment, all the terms and provisions of this Guaranty shall inure to the benefit of such
assignee to the extent so assigned. Guarantor may not assign its rights, duties and obligations
under this Guaranty, in whole or in part, without Lender’s prior written consent and any such
assignment shall be deemed void ab initio. The terms used to designate any of the parties herein
shall be deemed to include the heirs, legal representatives, successors and assigns of such
parties.



					
	 	 	 	 	 
	Guaranty of Non-Recourse Obligations
	 	Form 6015
	 	Page 7
	Fannie Mae
	 	04-11
	 	© 2011 Fannie Mae
















 






18. Final Agreement.




     Guarantor acknowledges receipt of a copy of each of the Loan Documents and this Guaranty.
THIS GUARANTY REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO THE SUBJECT MATTER
HEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. All prior or
contemporaneous agreements, understandings, representations and statements, oral or written, are
merged into this Guaranty. Neither this Guaranty nor any of its provisions may be waived,
modified, amended, discharged or terminated except by an agreement in writing signed by the party
against which the enforcement of the waiver, modification, amendment, discharge or termination is
sought, and then only to the extent set forth in that agreement.



19. Governing Law.




     This Guaranty shall be governed by and construed in accordance with the substantive law of the
Property Jurisdiction without regard to the application of choice of law principles that would
result in the application of the laws of another jurisdiction.



20. Property Jurisdiction.




     Guarantor agrees that any controversy arising under or in relation to this Guaranty shall be
litigated exclusively in the Property Jurisdiction. The state and federal courts and authorities
with jurisdiction in the Property Jurisdiction shall have exclusive jurisdiction over all
controversies which shall arise under or in relation to this Guaranty or any other Loan Document
with respect to the subject matter hereof. Guarantor irrevocably consents to service, jurisdiction
and venue of such courts for any such litigation and waives any other venue to which it might be
entitled by virtue of domicile, habitual residence or otherwise.



21. Time is of the Essence.




     Guarantor agrees that, with respect to each and every obligation and covenant contained in
this Guaranty, time is of the essence.



22. Notices.




     Guarantor agrees to notify Lender of any change in Guarantor’s address within ten (10)
Business Days after such change of address occurs. All “Notices” under this Guaranty shall be:



     (a) in writing and shall be




     (1) delivered, in person;




     (2) mailed, postage prepaid, either by registered or certified delivery, return receipt
requested;



					
	 	 	 	 	 
	Guaranty of Non-Recourse Obligations
	 	Form 6015
	 	Page 8
	Fannie Mae
	 	04-11
	 	© 2011 Fannie Mae
















 







     (3) sent by overnight courier; or




     (4) sent by electronic mail with originals to follow by overnight courier;




     (b) addressed to the intended recipient at the notice addresses provided under the signature
block at the end of this Guaranty; and




     (c) deemed given on the earlier to occur of:




     (1) the date when the Notice is received by the addressee; or




     (2) if the recipient refuses or rejects delivery, the date on which the Notice is so
refused or rejected, as conclusively established by the records of the United States Postal
Service or such express courier service.


Lender shall endeavor to give Guarantor’s counsel a courtesy copy of any notice given to Guarantor
by Lender, at such counsel’s address provided on the signature page of this Guaranty; provided,
however, failure to provide such courtesy copy notice shall not affect the validity or sufficiency
of any notice to Guarantor, shall not affect Lender’s rights and remedies hereunder or under any
other Loan Documents, nor subject Lender any claim by or liability to Guarantor.




23. Construction.




     (a) Any reference in this Guaranty to an “Exhibit” or “Schedule” or a “Section” or an
“Article” shall, unless otherwise explicitly provided, be construed as referring, respectively, to
an exhibit or schedule attached to this Guaranty or to a Section or Article of this Guaranty.



     (b) Any reference in this Guaranty to a statute or regulation shall be construed as referring
to that statute or regulation as amended from time to time.



     (c) Use of the singular in this Guaranty includes the plural and use of the plural includes
the singular.



     (d) As used in this Guaranty, the term “including” means “including, but not limited to” or
“including, without limitation,” and is for example only, and not a limitation.



     (e) Whenever Guarantor’s knowledge is implicated in this Guaranty or the phrase “to
Guarantor’s knowledge” or a similar phrase is used in this Guaranty, Guarantor’s knowledge or such
phrase(s) shall be interpreted to mean to the best of Guarantor’s knowledge after reasonable and
diligent inquiry and investigation.



     (f) Unless otherwise provided in this Guaranty, if Lender’s approval is required for any
matter hereunder, such approval may be granted or withheld in Lender’s sole and absolute
discretion.



     (g) Unless otherwise provided in this Guaranty, if Lender’s designation, determination,
selection, estimate, action or decision is required, permitted or contemplated



					
	 	 	 	 	 
	Guaranty of Non-Recourse Obligations
	 	Form 6015
	 	Page 9
	Fannie Mae
	 	04-11
	 	© 2011 Fannie Mae
















 





hereunder, such designation, determination, selection, estimate, action or decision shall be
made in Lender’s sole and absolute discretion.




     (h) All references in this Guaranty to a separate instrument or agreement shall include such
instrument or agreement as the same may be amended or supplemented from time to time pursuant to
the applicable provisions thereof.



     (i) “Lender may” shall mean at Lender’s discretion, but shall not be an obligation.



24. WAIVER OF JURY TRIAL.




     TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH OF GUARANTOR AND LENDER (A) AGREES NOT
TO ELECT A TRIAL BY JURY WITH RESPECT TO ANY ISSUE ARISING OUT OF THIS GUARANTY OR ANY LOAN
DOCUMENT OR THE RELATIONSHIP BETWEEN THE PARTIES AS GUARANTOR AND LENDER THAT IS TRIABLE OF RIGHT
BY A JURY AND (B) WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO SUCH ISSUE TO THE EXTENT THAT
ANY SUCH RIGHT EXISTS NOW OR IN THE FUTURE. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY
GIVEN BY GUARANTOR AND LENDER, KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL
COUNSEL.



25. Schedules.




     The schedules, if any, attached to this Guaranty are incorporated fully into this Guaranty by
this reference and each constitutes a substantive part of this Guaranty.



ATTACHED SCHEDULE. The following Schedule is attached to this Guaranty:




	 	 	 

	o Schedule 1

	 	Modifications to Guaranty






[Remainder of Page Intentionally Blank]




					
	 	 	 	 	 
	Guaranty of Non-Recourse Obligations
	 	Form 6015
	 	Page 10
	Fannie Mae
	 	04-11
	 	© 2011 Fannie Mae
















 






     IN WITNESS WHEREOF, Guarantor has signed and delivered this Guaranty under seal (where
applicable) or has caused this Guaranty to be signed and delivered under seal (where applicable) by
its duly authorized representative. Where applicable law so provides, Guarantor intends that this
Guaranty shall be deemed to be signed and delivered as a sealed instrument.



	 	 	 	 	 
	 	GUARANTOR:







STEADFAST INCOME REIT, INC.,

a Maryland corporation

 	 
	 	By:  	/s/ Ana Marie del Rio
 	 
	 	 	Name:  	Ana Marie del Rio 	 
	 	 	Title:  	Secretary 	 
	 



	 	 	 

	 

	 	Address for Notices to Guarantor:
	 
	 

	 	18100 Von Karman Avenue, Suite 500
	 

	 	Irvine, Orange County, California 92612
	 

	 	Email address: adelrio@steadfastcompanies.com
	 
	 	 
	 

	 	with a courtesy copy to Guarantor’s counsel at:
	 
	 	 
	 

	 	Garrett DeFrenza Stiepel LLP
	 

	 	Park Tower
	 

	 	695 Town Center Drive, Suite 500
	 

	 	Costa Mesa, California 92626-1924
	 

	 	Attn: Marc DeFrenza and Jim Mullen
	 

	 	Email addresses: mdefrenza@gdslaw.net and 

jmullen@gdslaw.net







					
	 	 	 	 	 
	Guaranty of Non-Recourse Obligations
	 	Form 6015
	 	Page S-1
	Fannie Mae
	 	04-11
	 	© 2011 Fannie Mae