**Exhibit 10.36**

 

RECORDER MEMO: This COPY has not been QUALITY ASSURED.

 

**This page is part of yourdocument - DO NOT DISCARD**

 
|   | ** ** | **20091425286**                                  | **Pages:** |
|--------|------------|--------------------------------------------------|------------|
|   | **[SEAL]** | **[BAR  CODE]**                                  | **0029**   |
|   | ** ** | **Recorded/Filed  in Official Records**          | ** ** |
|   | ** ** | **Recorder’s  Office, Los Angeles County,** | ** ** |
|   | ** ** | **California**                                   | ** ** |
|   | ** ** | **09/18/09  AT 08:00AM**                         | ** ** |

 

| FEES:  |   | 0.00 |   |
|--------|--------|------|--------|
| TAXES: |   | 0.00 |   |
| OTHER: |   | 0.00 |   |
| PAID:  |   | 0.00 |   |

 

**[BAR CODE]**

**LEADSHEET**

 

**[BAR CODE]**

**200909180180006**

 

**00001216363**

 

**[BAR CODE]**

**002346527**

 

**SEQ:03**

 

DAR - Title company (Hard Copy)

 

**[BAR CODE]**

 

**THIS FORM ISNOT TO BE DUPLICATED**

 
| [ILLEGIBLE] |   | T72 |
|-------------|--------|-----|

 

----

 

CHICAGOTITLE COMPANY

 
|                                     | **09/18/2009**    |
|------------------------------------------|-------------------|
| RECORDING  REQUESTED BY                  | **[BAR  CODE]**   |
| AND  WHEN RECORDED MAIL TO:              | ***20091425286*** |
|                                     | ** **        |
| Munsch  Hardt Kopf & Harr, P.C. | ** **        |
| 3800  Lincoln Plaza                      | ** **        |
| 500  N. Akard                            | ** **        |
| Dallas,  Texas 75201                     | ** **        |
| Attention:  Gregg Cleveland              | ** **        |

 

 

*(Spaceabove this tine for Recorder’s use only)*

 

**SUBAREA “A”PARTIAL ASSIGNMENT OF OWNER PARTICIPATION AGREEMENT**

**AND CONSENTTO ASSIGNMENT**

 

THIS SUBAREA “A” PARTIAL ASSIGNMENT OF OWNER PARTICIPATION AGREEMENT ANDCONSENT TO ASSIGNMENT (this **“Agreement”**)****is entered into as of this 17th****day of September,****2009, by and between SF NO HO LLC, aCalifornia limited liability company (**“Assignor”**),BEHRINGER HARVARD NOHO, LLC, a Delaware limited liability company (**“Assignee”**) and THE COMMUNITY REDEVELOPMENTAGENCY OF THE CITY OF LOS ANGELES, a public body, corporate and politic (the **“CRA/LA”**)****with respect tothat certain real property (the **“Property”**)****described more fully in **Exhibit “A”**(Legal Description)attached hereto and incorporated herein by this reference. Assignor, Assigneeand the CRA/LA shall hereinafter sometimes be referred to individually as a **“Party”**and collectively as the **“Parties.”**

 

**SEE EXHIBIT A and “B”**

 

RECITALS

 

WHEREAS, SL No Ho, LLC, a California limited liability company (**“Developer”**)****and the CRA/LA entered into that certain Owner ParticipationAgreement dated as of March 5, 2002, as supplemented and amended by (i) thatcertain First Implementation Agreement dated as of November 18, 2002, (ii) thatcertain Second Implementation Agreement dated as of December 12, 2003 (the**“Second Implementation”**),****(iii) that certain ThirdImplementation Agreement dated as of October 1, 2004, (iv) thatcertain Partial Assignment and Assumption Agreement dated as of December 18,2003 from Developer to Assignor concerning Subarea A, (v) that certainSecond Partial Assignment and Assumption Agreement dated as of October 1,2004 from Developer to No Ho Lofts, LLC, a Delaware limited liability company (**“Subarea B Assignee”**)****concerning Subarea B, (vi) thatcertain Third Partial Assignment of Owner Participation Agreement and Consentto Assignment, dated as of January 9, 2007 from Subarea B Assignee toRedRock Noho Residential, LLC, a Delaware limited liability company and SMASPE, LLC,  a Delaware limited liabilitycompany (collectively, **“Subarea B-2 Assignee”**)**,**as tenants in common concerning SubareaB-2, (viii) that certain Fourth Partial Assignment of Owner ParticipationAgreement****and Consent toAssignment, dated as of August 3, 2007 from No Ho Lofts, LLC, a Delawarelimited liability company to RedRock Noho Retail, LLC, a Delaware limitedliability company (the **“Subarea B-1 Assignee”**)**,**concerning Subarea B-l (ix) thatcertain Letter Agreement dated December 18, 2003 concerning the LosAngeles County Metropolitan Transportation Authority right of way realignmentand exchange (the **“First Letter Agreement”**)**,**(x) that certain Letter Agreementdated March 4, 2004 correcting certain obligations under Item 103.1****(e)(3) (the **“Second Letter Agreement”**)**,**(xi) that certain**Letter Agreement dated February 13,2007 concerning certain construction obligations of Assignor, and

 

1

----

 

RECORDINGREQUESTED BY

ANDWHEN RECORDED MAIL TO:

 

MunschHardt Kopf & Harr, P.C.

3800Lincoln Plaza

500N. Akard

Dallas,Texas 75201

Attention:Gregg Cleveland

 

 

*(Spaceabove this line for Recorder’s use only)*

 

**SUBAREA “A”PARTIAL ASSIGNMENT OF OWNER PARTICIPATION AGREEMENTAND CONSENT TO ASSIGNMENT**

 

THIS SUBAREA “A” PARTIAL ASSIGNMENT OF OWNER PARTICIPATION. AGREEMENTAND CONSENT TO ASSIGNMENT (this **“Agreement”**)****is entered into as of this 17 day ofSeptember, 2009, by and between SF NO HO LLC, a California limited liabilitycompany (**“Assignor”**).****BEHRINGER HARVARD NOHO, LLC, a Delawarelimited liability company (**“Assignee”**)****and THE COMMUNITY REDEVELOPMENT AGENCY OFTHE CITY OF LOS ANGELES, a public body, corporate and politic (the **“CRA/LA”**)****with respect to that certain real property (the **“Property”**)****described more fully in **Exhibit “A”**(Legal Description) attached hereto and incorporated herein by thisreference. Assignor, Assignee and the CRA/LA shall hereinafter sometimes bereferred to individually as a **“Party”**andcollectively as the **“Parties.”**

 

RECITALS

 

WHEREAS, SL No Ho, LLC, a California limited liability company **(“Developer”**)****and the CRA/LAentered into that certain Owner Participation Agreement dated as of March 5,2002, as supplemented and amended by (i) that certain First ImplementationAgreement dated as of November 18, 2002, (ii) that certain SecondImplementation Agreement dated as of December 12, 2003 (the **“Second Implementation”**)**,**(iii) thatcertain Third Implementation Agreement dated as of October 1, 2004, (iv) thatcertain Partial Assignment and Assumption Agreement dated as of December 18,2003 from Developer to Assignor concerning Subarea A, (v) that certainSecond Partial Assignment and Assumption Agreement dated as of October 1,2004 from Developer to No Ho Lofts, LLC, a Delaware limited liability company **(“Subarea B Assignee”**)****concerningSubarea B, (vi) that certain Third Partial Assignment of OwnerParticipation Agreement and Consent to Assignment, dated as of January 9,2007 from Subarea B Assignee to RedRock Noho Residential, LLC, a Delawarelimited liability company and SMA SPE, LLC, a Delaware limited liabilitycompany (collectively, **“Subarea B-2 Assignee”**)**,**astenants in common concerning Subarea B-2, (viii) that certain FourthPartial Assignment of Owner Participation Agreement and Consent to Assignment,dated as of August 3, 2007 from No Ho Lofts, LLC, a Delaware limitedliability company to RedRock Noho Retail, LLC, a Delaware limited liabilitycompany (the **“Subarea B-1 Assignee”**)**,**concerningSubarea B-l (ix) that certain Letter Agreement dated December 18,2003 concerning the Los Angeles County Metropolitan Transportation Authorityright of way realignment and exchange (the **“FirstLetter Agreement”**)**,**(x) that certain LetterAgreement dated March 4, 2004 correcting certain obligations under Item103.1 (e)(3) (the **“Second LetterAgreement”**)**,**(xi) that certain Letter Agreementdated February 13, 2007 concerning certain construction obligations ofAssignor, and

 

1

----

 

(xii)that certain Letter Agreement dated August 31, 2005 correcting Attachment10 (collectively, the “**OPA**”).

 

WHEREAS, certain terms of the OPA are also reflected in the followingdocuments recorded against the Property: (i) Agreement ContainingCovenants Affecting Real Property/Affordability Covenants recorded as Document No. 03-3851364in the records of the Los Angeles County Recorder’s office; and (2) AgreementContaining Covenants Affecting Real Property recorded as Document No. 03-3851365in the records of the Los Angeles County Recorder’s office (collectively, the **“Regulatory Agreements”**).

 

WHEREAS, any capitalized terms not otherwise defined in this Agreementshall have the respective meanings ascribed to such terms in the OPA.

 

WHEREAS, pursuant to the OPA: Developer (i) has certain rights todevelop a mixed-use development in North Hollywood, California, known as NoHoCommons (the **“Project”**);****and (ii) in consideration forDeveloper developing the Project in accordance with the CRA/LA’s guidelines andrequirements, the CRA/LA will assist with financing for the Project by makingavailable to Assignor certain CRA/LA subsidies and facilitating certain loansand grants.

 

WHEREAS, pursuant to that certain Partial Assignment of OwnerParticipation Agreement and Consent to Assignment, dated as of December 18,2003 (the **“Subarea A****Assignment”**),****Developer assigned to Assignor certain rights, duties andobligations relating to the construction, operation and maintenance of SubareaA.

 

WHEREAS, pursuant to that certain Second Partial Assignment of OwnerParticipation Agreement and Consent to Assignment, dated as of October 1,2004 (the **“Subarea B Assignment”**),Developer assigned to the Subarea B Assignee all of its rights, duties andobligations relating to the construction, operation and maintenance of SubareaB and the Subarea B Improvements.

 

WHEREAS, pursuant to the that certain Third Partial Assignment of OwnerParticipation Agreement and Consent to Assignment, dated as of January 9,2007 (the **“Subarea B-2 Assignment”**),****the Subarea B Assignee assigned to theSubarea B-2 Assignee all of its rights, duties and obligations relating to theoperation and maintenance of Subarea B-2 and the Subarea B-2 Improvements.

 

WHEREAS, pursuant to that certain Fourth Partial Assignment of OwnerParticipation Agreement and Consent to Assignment, dated as of August 3,2007 (the **“Subarea B-l Assignment”**),****the Subarea B Assignee assigned to theSubarea B-l Assignee all of its rights, duties and obligations relating to theoperation and maintenance of Subarea B-l and the Subarea B-l Improvements.

 

WHEREAS, Assignor has agreed to transfer and convey to Assignee its feeinterest in Subarea A together with those certain apartment buildingscontaining approximately 438 apartment units, and the other improvements,structures and fixtures placed, constructed or installed on Subarea A(collectively, the **“Subarea A Improvements”**)and to assign Assignor’s rights, duties and obligations under the OPA andRegulatory Agreements, with the exception of the Retained Obligations which arenot being assigned hereunder, to Assignee which are specifically set forth on Exhibit “B”and relate solely to the operation and maintenance of Subarea A and the SubareaA Improvements (collectively, the **“AssigneeProperty”**),****all subjectto the terms and conditions of this Agreement.

 

2

----

 

WHEREAS, Developer, the Subarea B Assignee, the Subarea B-l Assignee andthe Subarea B-2 Assignee shall retain all of the obligations contained in theOPA that do not relate to the Assignee Property, including without limitationall obligations relating to the Assignee Property that were retained byDeveloper pursuant to the Subarea A Assignment, Subarea B (including SubareaB-l and Subarea B-2), Subarea C, Subarea D, the Subarea B Improvements (includingthe Subarea B-l Improvements and the Subarea-B-2 Improvements), the Subarea CImprovements and the Subarea D Improvements (collectively, the **“Non-Subarea A Obligations”)**and Developer,the Subarea B Assignee, the Subarea B-l Assignee and the Subarea B-2 Assigneeshall retain all of the rights contained in the OPA that do not relate to theAssignee Property, including without limitation all rights relating to SubareaB (including Subarea B-l and Subarea B-2), Subarea C, Subarea D, the Subarea BImprovements (including the Subarea B-l Improvements and the Subarea-B-2Improvements), the Subarea C Improvements and the Subarea D Improvements(collectively, the **“Non-Assigned Property”**)**.**

 

WHEREAS, Assignor and Assignee require CRA/LA’s execution of this Agreementas the CRA/LA’s acknowledgement and agreement of the matters set forth in thisAgreement including, without limitation, those obligations and restrictions inthe OPA which continue to attach to the Assignee Property as set forth in thisAgreement and a release of the Assignee Property and the Assignee of all otherobligations, restrictions and requirements described in the OPA.

 

NOW THEREFORE, in consideration of the mutual covenants and agreementscontained herein, and other good and valuable consideration the receipt andsufficiency of which are hereby acknowledged, the Parties hereby agree asfollows:

 

ARTICLE I

DEFINITIONS

 

Section 1.1                           Defined Terms. Inaddition to terms defined elsewhere herein, the following terms shall have thefollowing respective meanings:

 

(a)                                     **“Assigned Interests”**means, only to the extent specifically setforth on Exhibit “B”, all of Assignor’s right, title and interest underthe OPA and the Regulatory Agreements with respect to the ownership, operationand maintenance of the Assignee Property together with any and all benefitsassociated therewith which occur after the Effective Date. The AssignedInterests are specifically set forth on Exhibit “B”, attached hereto andincorporated herein by this reference, and it is the Parties intent that theAssigned Interests include all rights under the OPA and the RegulatoryAgreements relating to the Assignee Property that are necessary for theAssignee Property to receive all of the benefits established in the OPA and theRegulatory Agreements for the Assignee Property, or that could reasonably beinferred to be an integral part of the benefits that are appurtenant to theAssigned Interests.

 

(b)                                    **“Assumed Obligations”**means those certain duties and obligationsunder the OPA and the Regulatory Agreements relating to the ownership,operation and maintenance of the Assignee Property specifically set forth as anobligation of Assignee on Exhibit “B” which occur after the EffectiveDate.

 

(c)                                     **“Business Day**” means any day on which banks are open toconduct business in the state of California.

 

3

----

 

(d)                                    **“CRA/LA Audit”**means that housing compliance audit currentlybeing conducted by the CRA/LA in regards to the Property for compliance withthe CRA/LA Housing Policy and/or the Housing Management Plan.

 

(e)                                     **“Effective Date”**means the date upon which fee title to theAssignee Property is conveyed to Assignee.

 

(f)                                       **“HUD Loan”**means the loan evidenced by and described inthat certain Loan Agreement (Number 106620 of City Contracts) between the Cityof Los Angeles, as lender, and the CRA/LA, as borrower, relating to theProject, dated May 4, 2004, as assigned to and assumed by Developerpursuant to that certain Assignment and Assumption Agreement by and between theCRA/LA and Developer entered into as of August 27, 2004.

 

(g)                                    **“Retained Obligations”**means those certain obligations and duties ofAssignor under the OPA relating to the acquisition and construction of theAssignee Property that are specifically set forth as an obligation of Assignoron Exhibit “C”.

 

ARTICLE II

ASSIGNMENT AND ASSUMPTION

 

Section 2.1                           Assignment. Assignorhereby assigns and transfers to Assignee all of Assignor’s right, title andinterest in and to the Assigned Interests, without recourse, representation orwarranty, which occur after the Effective Date, it being the intent of theParties that all benefits including, without limitation, all subsidies andother payments, relating to periods of time after the Effective Date areassigned to Assignee and only those benefits including, without limitation, allsubsidies and other payments, relating to periods of time prior to theEffective Date are retained by Assignor.

 

Section 2.2                           Acceptance and Assumption. Assignee hereby accepts the foregoing assignment and transfer fromAssignor, and Assignee hereby assumes and agrees to perform all of the AssumedObligations which occur after the Effective Date, and to be bound by, and tocomply from and after the Effective Date with, all of the terms and provisionsof the OPA and the Regulatory Agreements to the extent same relate to theAssigned Interests and the Assumed Obligations.

 

Section 2.3                           Effect of Assignment.From and after the Effective Date the Parties, by their execution of thisAgreement, agree that: (a) Assignee shall be deemed a party to the OPA andany reference therein to “Developer” shall be deemed to refer to Assignee tothe extent said reference relates to the Assigned Interests and/or the AssumedObligations; (b) Assignor shall remain a party to the OPA solely withrespect to the Retained Obligations and, except as set forth in Subsection 2.3(a) above,any reference to “Developer” shall be deemed to refer to Assignor, Developer,the Subarea B Assignee, the Subarea B-l Assignee or the Subarea B-2 Assignee,as the case may be; (c) Assignee shall be entitled to exercise and enforceall rights to the Assigned Interests under the OPA as if Assignee had been asignatory to the OPA or a beneficiary thereunder as of the date of its originalexecution and Assignor shall no longer have any entitlement thereto; (d) CRA/LAhereby releases Assignee, its successors and assigns and the Assignee Propertyfrom all obligations, restrictions and requirements contained in the OPA,except for compliance with the Assumed Obligations specified on Exhibit “B”from and after the Effective Date; and (e) Assignor is not released fromand shall be responsible for the performance and

 

4

----

 

satisfactionof the Retained Obligations and Assignee shall have no liability therefore; (f) CRA/LAhereby releases Assignor from all duties and obligations under the OPA andRegulatory Agreements which occur after the Effective Date and the obligationsrelated to the Assignee Property assumed by Assignee as set forth on Exhibit “B”which occur after the Effective Date.

 

Section 2.4                           Consent to Amendment.Notwithstanding Section 2.3 above, from and after the Effective Date, anyfuture amendment of the OPA which does not affect any of the Assignee Property,the Assigned Interests, or the Assumed Obligations shall not require theconsent or signature of Assignee. In addition, from and after the EffectiveDate, the CRA/LA shall make a good faith effort to provide written notificationto Lender (defined below and at the address below) at least ten (10) daysprior to executing any proposed amendments or modifications to any of theprovisions of the OPA which are binding on the Assignee Property. From andafter the Effective Date, the CRA/LA agrees that any amendments ormodifications to any of the provisions of the OPA which are binding on theAssignee Property shall not be binding on the Lender, unless the Lender hasconsented to such amendments or modifications, such consent not to beunreasonably withheld, delayed or conditioned.

 

Section 2.5                           Conflict of Terms. Itis the intent of the Parties that this Agreement effect an assignment toAssignee of all of Assignor’s right, title and interest in and to the operationand maintenance of the Assignee Property under the OPA to the extent of theAssigned Interests and Assumed Obligations set forth on Exhibit “B”. Exhibit “B”is intended as an exhaustive list of all assigned rights, benefits andobligations. Therefore, notwithstanding the provisions set forth in Section 2.1above, to the extent that a particular interest, obligation, or benefit underthe OPA is expressly assigned or assumed, as applicable, in Exhibit “B”,such specific provision shall control over the general assignment languagecontained in Sections 2.1 and 2.2 above.

 

ARTICLE III

ASSIGNOR’S REPRESENTATION ANDWARRANTY

 

Section 3.1                           No Default Under OPA.Assignor hereby represents and warrants to Assignee that, neither the Assignornor, to the best of Assignor’s knowledge, the CRA/LA is in default of any ofits obligations under the OPA or the Regulatory Agreements.

 

ARTICLEIV

CRA/LACONSENT

 

Section 4.1                           Consent toAssignment. The CRA/LA acknowledges,consents and agrees to the allocation of obligations and benefits as set forthherein and shall not attempt to bestow any benefit upon Assignor under the OPAunless and only to the extent that such action is consistent with theallocation of such benefit as set forth in this Agreement. The CRA/LA consentsto: (i) the assignment, transfer and/or hypothecation of Assignee’sinterest in the Assignee Property and the OPA by Assignee to any lenderincluding, without limitation Red Mortgage Capital, Inc., its successorsand assigns pursuant to the Fannie Mae Delegated Underwriting and ServicingProgram (collectively, the **“Lender”**)****oris assignee or designee including, without limitation, any assignee or designeein lieu of foreclosure, without liability for any event of default under theOPA or the Regulatory Agreements first accruing or arising prior to Lender’s orits assignee’s or designee’s acquisition of the Assignee Property. The CRA/LAshall have the right to require any transferee of the Assignee Property tocomply with the terms and obligations of the OPA and the Regulatory Agreementsfirst accruing and arising during the transferee’s period of

 

5

----

 

ownershipin order for the transferee to enforce the benefits of, and the obligations ofthe CRA/LA under, the OPA relating to the Assignee Property.

 

Section 4.2                           No Breach of the Assumed Obligations. The CRA/LA hereby certifies to Assignor, Assignee and Lender that,subject to the findings of the CRA/LA Audit, Assignor (a) has performedand is in compliance in all material respects with its obligations under theOPA and the Regulatory Agreements, including the Retained Obligations, and (b) isnot currently in default of any of its obligations under the OPA or theRegulatory Agreements, including the Retained Obligations. The CRA/LAacknowledges that Assignor and Assignee are entering into this Agreement inreliance upon said certification and that the CRA/LA shall hereafter beestopped from pursuing any rights or remedies against Assignee or Lender inconnection with any alleged breach of an Assumed Obligation prior to the datehereof.

 

Section 4.3                           Waiver and Release of Claims.

 

(a)                     The CRA/LA hereby acknowledges and agreesthat, from and after the Effective Date only, Assignee (and its successors)shall be responsible for compliance with (and the Assignee Property shall onlybe bound and encumbered by) only the Assumed Obligations which occur after theEffective Date and, from and after the Effective Date, the CRA/LA expressly,fully and forever releases and discharges Assignee and the Assignee Property fromany and all losses, expenses, claims, costs, damages, debts, attorneys’ fees,actions, suits, judgments, awards, obligations and/or liabilities of any kind,whether foreseeable or unforeseeable, known or unknown, suspected orunsuspected, with respect to or in any way relating to or arising out of (i) theNon-Subarea A Obligations and the Non-Assigned Property, and (ii) anyobligations under the OPA or the Regulatory Agreements which occurred prior tothe Effective Date including, without limitation, the Retained Obligations;provided that nothing herein shall be deemed a release of Assignee from theAssumed Obligations.

 

(b)                    The CRA/LA hereby acknowledges and agreesthat, from and after the Effective Date only, (i) Assignor (and itssuccessors) shall not be responsible for any obligations under the OPA or theRegulatory Agreements which occur after the Effective Date except for theRetained Obligations that have not been fully performed by Assignor, and (ii) theCRA/LA expressly, fully and forever releases and discharges Assignor from anyand all losses, expenses, claims, costs, damages, debts, attorneys’ fees,actions, suits, judgments, awards, obligations and/or liabilities of any kind,whether foreseeable or unforeseeable, known or unknown, suspected or unsuspected,with respect to or in any way relating to or arising out of the OPA or theRegulatory Agreements which occur after the Effective Date; provided thatnothing herein shall be deemed a release of Assignor from the RetainedObligations that have not been fully performed by Assignor.

 

(c)                     The Parties acknowledge that the Property iscurrently being audited under the CRA/LA Audit and that the CRA/LA Audit mayreveal violations of the OPA, including but not limited to the CRA/LA HousingPolicy and/or the Housing Management Plan attached to the OPA. Notwithstandinganything to the contrary in this Agreement, the Parties do hereby acknowledgethat this Waiver and Release of Claims does not extend to violations uncoveredin the CRA/LA Audit and the Parties further agree to correct any violationsuncovered by the CRA/LA Audit in a manner reasonably satisfactory to theCRA/LA.

 

6

----

 

(d)                    The Parties agree that the HUD Loan does notencumber the Assignee Property nor is the Assignee responsible for repayment ofthe HUD Loan and the Developer (as defined in the first Recital above) issolely responsible for repayment of the HUD Loan. The CRA/LA expressly, fullyand forever releases and discharges, Assignor, Assignee and the AssigneeProperty from any remedies which might be construed as in any way relating toor arising out of a default of the HUD Loan under the OPA. The Parties agree thatany default by Developer on the HUD Loan shall be interpreted as a DeveloperEvent of Default pursuant to Section 1001.1 and Section I.E. ofAttachment No. 8 of the OPA and shall have no affect whatsoever on theAssignee or the Assignee Property. The CRA/LA hereby acknowledges and agreesthat in the event of such Developer Event of Default, the CRA/LA shall have noright against Assignor, Assignee or the Assignee Properly. Notwithstanding theforegoing, the CRA/LA acknowledges and agrees that, as set forth in Exhibit “B”,from and after the Effective Date, any and all payments set forth in Section I.A.2.of Attachment 8, as amended by Section 22 of the Second Implementation,which are allocated to Subarea A (each a “HUD Payment”) shall be paid toAssignee. Assignor and Assignee shall prorate the HUD Payment applicable to theCRA/LA Fiscal Year 2009-2010 between themselves.

 

Section 4.4                           No Cross Default. TheCRA/LA hereby acknowledges that:

 

(a)                                     A default of any of the Assumed Obligationsshall not be deemed a default of the Non-Subarea A Obligations and/or RetainedObligations, and vice versa.

 

(b)                                    In the event of a default of any of theNon-Subarea A Obligations, then the CRA/LA shall have no rights or remediesagainst Assignor, Assignee or the Assignee Property and, to the extent thatsuch a default would entitle the CRA/LA to terminate the OPA, then the CRA/LAshall have no right to terminate the OPA to the extent it relates to Subarea Aor the Subarea A Improvements, including without limitation, any of theAssigned Interests.

 

(c)                                     In the event of a default of any of theRetained Obligations, then the CRA/LA shall have no rights or remedies againstAssignee or the Assignee Property and, to the extent that such a default wouldentitle the CRA/LA to terminate the OPA, then the CRA/LA shall have no right toterminate the OPA to the extent it relates to Subarea A or the Subarea AImprovements, including without limitation, any of the Assigned Interests.

 

Section 4.5                           Consent to Financing and Security Interest: The CRA/LA hereby acknowledges and agreesthat Assignee, and any successors to Assignee, shall have the right, at anytime and without notice to or the need for approval from CRA/LA, to encumberall or any portion of the Assignee Property.

 

Section 4.6                           Relinquishment of Right of Reverter. The right of reveller related to the Assignee Property reserved toCRA/LA under OPA Section 1002.3 and in the Grant Deed from CRA/LA andrecorded as Instrument No. 03-3851362 on December 23, 2003, is herebyquitclaimed, waived, released and relinquished by the CRA/LA. The CRA/LA agreesto execute and deliver on or prior to the Effective Date a quitclaim of suchright of reverter, and/or such other documentation evidencing therelinquishment of such right by the CRA/LA as Assignee or Assignee’s titlecompany may reasonably require.

 

Section 4.7.                        Relinquishment of Option to Purchase. The option to purchase the Assignee Property reserved to CRA/LA underOPA Section 1004 and in the Grant Deed from CRA/LA and recorded asInstrument No. 03-3851362 on December 23, 2003, is herebyquitclaimed, waived, released

 

7

----

 

and relinquished by CRA/LA. CRA/LA agrees on or prior to the EffectiveDate to execute and deliver a quitclaim of such option to purchase, and/or suchother documentation evidencing the relinquishment of such option by CRA/LA asAssignee or Assignee’s title company may reasonably require.

 

Section 4.8                           Lender Reliance. EachParty hereto hereby acknowledges and agrees that any Lender shall have theright to rely on the contents and provisions of this Agreement and that suchLender will rely on such content and provisions in connection with its loan toAssignee.

 

Section 4.9                           Affordable Housing Subsidy. The CRA/LA acknowledges and agrees that (a) the AffordableHousing Subsidy in the Public-Private Feasibility Agreement (Attachment No. 8to the OPA) with respect to Subarea A is assigned to Assignee and that CRA/LAwill provide the Affordable Housing Subsidy payable for the Restricted Unitsprovided on Subarea A to Assignee in accordance with the provisions of the OPA,(b) the amount of the Affordable Housing Subsidy is $1,988,276.24 perannum which amount shall be paid to the owner of Subarea A by September 30of each year, (c) the Affordable Housing Subsidy is scheduled to be paidin twenty-one (21) equal annual installments beginning with the CRA/LA FiscalYear 2008-2009 and continuing annually until the CRA/LA Fiscal Year 2028-2029, (d) thefirst installment of the Affordable Housing Subsidy was paid to Assignor on orabout September 30, 2008 for the CRA/LA Fiscal Year 2008-2009, (e) theCRA/LA Fiscal Year is from July 1 to June 30 of each year, and (f) allother subsidies and payments set forth in the OPA with respect to Subarea Aare, to the extent set forth in Exhibit “B”, assigned to Assignee.Assignor and Assignee shall prorate the Affordable Housing Subsidy applicableto the CRA/LA Fiscal Year 2009-2010 between themselves.

 

ARTICLE V

EFFECT OF ASSIGNMENT ONINTERPRETATION OF OPA

 

Section 5.1                           Interpretation of OPA.The Parties hereby acknowledge and agree that, from and after the EffectiveDate, certain rights, duties and obligations under the OPA shall be interpretedas follows:

 

(a)                                     The failure by Developer to commence or completeconstruction of any improvements on time (or at all) on the Non-AssignedProperty shall not constitute a default on the part of Assignee and shall notaffect Assignee’s right to any benefit that Assignee may otherwise be entitledto under the OPA.

 

(b)                                    With respect to the Assignee Property, theCRA/LA shall have no right pursuant Section 1003.3 of the OPA to terminatethe OPA after the Effective Date of this Agreement.

 

(c)                                     The transfer of the Assignee Property toAssignee constitutes a “First Sale” pursuant to Section 605.3. l(c) ofthe OPA of the Subarea A Project Element, and that, upon payment by Assignor tothe CRA/LA of the amount required by Section 605.3.1(a) of the OPA,if any, the Adjusted Project Costs shall be defined as the gross proceeds ofthe sale of the Assignee Property pursuant to Section 605.3. l(b) ofthe OPA.

 

(d)                                    The CRA/LA acknowledges that no payment is duethe CRA/LA under Section 605.3.1(c) of the OPA.

 

8

----

 

(e)                                     Assignee shall be responsible only for theaccuracy of those representations and warranties of the Developer under the OPAthat relate to the Assignee Property from and after the Effective Date.

 

ARTICLE VI

INDEMNITIES

 

Section 6.1                           Assignor Indemnity.Subject to Section 6.3, below, but without limiting the provisions of Section 4.3or Section 5.1 hereof, Assignor hereby agrees to indemnify, defend andhold harmless Assignee and Assignee’s officers, directors, trustees,shareholders, members, partners, employees, beneficiaries, representatives,managers, agents and controlling persons (collectively the **“Indemnified Parties”**) from and against any and allexpenses, losses, claims, damages and liabilities (including without limitationreasonable attorneys’ fees and expenses) caused by, or in any way resultingfrom or relating to, a breach by Assignor of any Assigned Interests or AssumedObligation prior to the Effective Date and a breach by Assignor of any RetainedObligation.

 

Section 6.2                           Assignee Indemnity.Subject to the provisions of Section 6.3, below, but without limiting theprovisions of Section 4.3 or Section 5.1 hereof, Assignee herebyagrees to indemnify, defend and hold harmless Assignor and Assignor’s officers,directors, trustees, shareholders, members, partners, employees, beneficiaries,representatives, managers, agents and controlling persons (also collectivelythe **“Indemnified Parties”**)****fromand against any and all expenses, losses, claims, damages and liabilities(including without limitation reasonable attorneys’ fees and expenses) causedby, or in any way resulting from or relating to, a breach by Assignee of anyAssigned Interests or Assumed Obligations on or after the Effective Date.

 

Section 6.3                           Indemnification Procedures. The respective obligations of Assignor and Assignee under Section 6.1and Section 6.2, above, shall be subject to the following terms andconditions:

 

(a)                                     As soon as reasonably possible, but no laterthan thirty (30) days following an Indemnified Party’s receipt of notice of anyclaim or other matter that may give rise to indemnification under thisAgreement (each a **“Claim”**)**,**saidIndemnified Party shall notify in writing the Party responsible for theapplicable indemnification obligation (the **“IndemnifyingParty”**)****of such Claim. The IndemnifyingParty shall undertake the defense of the Claim with legal representation of theIndemnifying Party’s choice but reasonably satisfactory to the IndemnifiedParty. The notice required by this Section 6.3(a) shall state thenature and basis upon which indemnification is sought. Failure of theIndemnified Party to give the notice required by this Section 6.3(a) withinthe applicable time period shall not relieve the Indemnifying Party of anyliability that the Indemnifying Party may have to the Indemnified Party exceptto the extent the Indemnifying Party is prejudiced thereby. All costs andexpenses of such defense (including reasonable fees of counsel) and anysettlement or compromise resulting from the defense of any claim or othermatter that may give rise to indemnification under this Agreement that has beenconsented to by the Indemnified Party shall be paid for by the IndemnifyingParty, provided that the Indemnifying Party’s obligation to indemnify suchIndemnified Party with respect to any such settlement or compromise shall befully satisfied by the payment by the Indemnifying Party of the amounts calledfor by such settlement or compromise and any such settlement or compromiseapproved by the Indemnified Party shall include a complete release of suchIndemnified Party.

 

9

----

 

(b)                                    In the event that the Indemnifying Party failsto undertake the defense of a Claim or advises the Indemnified Party of itsintention not to defend a Claim, the Indemnified Party will (upon furtherwritten notice to the Indemnifying Party) have the right to undertake thedefense, compromise or settlement of said Claim on behalf of and for theaccount and risk of the Indemnifying Party, and the Indemnifying Party shallreimburse the Indemnified Party for any and all reasonable, third-party,out-of-pocket costs and expenses (including reasonable attorney’s fees)incurred by the Indemnified Party for the defense, compromise or settlement ofsaid Claim.

 

(c)                                     Any judgment, award, settlement or compromiseof any Claim, the defense of which has been undertaken by the IndemnifyingParty, shall be solely for the payment of money and shall be binding on theIndemnified Party, and the amount of such judgment, award, settlement orcompromise shall be prima facie evidence of the amount (together with allamounts in respect of costs and expenses referred to in Section 6.3(a),above) which the Indemnifying Party is obligated to indemnify the IndemnifiedParty under this Agreement with respect to any Claim. In the event of paymentby the Indemnified Party of any amount subject to indemnification under thisAgreement that neither the Indemnifying Party nor the Indemnified Party electto contest or defend as above provided, the actual amount of such payment shallbe prima facie evidence of the amount (together with all amounts in respect ofcosts and expenses referred to in Section 6.3(a), above) which theIndemnifying Party is obligated to indemnify the Indemnified Party under thisAgreement with respect to that payment.

 

(d)                                    In the event so requested by the IndemnifyingParty, the Indemnified Party shall use its reasonable best efforts to makeavailable all information and assistance reasonably required in the defense bythe Indemnifying Party of any Claim.

 

(e)                                     Any and all claims made by Assignor or anyIndemnified Party under Section 6.2 above shall be subject and subordinateto the rights and liens of any bona fide third party beneficiary of a deed oftrust encumbering the Assignee Property.

 

ARTICLE VII

MISCELLANEOUS

 

Section 7.1                           Further Assignment of Assigned Interests. The CRA/LA acknowledges that, from and afterthe Effective Date, Assignee may sell, assign, transfer, encumber or grant toany third parties any rights, duties or interests in the Assigned Propertywithout the prior written consent of the CRA/LA.

 

Section 7.2                           Receipt of Further Payments. If Assignor receives, after the Effective Date, any payments orbenefits on account of any Assigned Interests, Assignor shall promptly notifyAssignee thereof, hold such amounts in trust for Assignee, and promptly (but inno event later than thirty (30) days after Assignor’s receipt thereof) turnover such amounts in full to Assignee or as Assignee may direct, in the same orequivalent form received, without recourse, representation or warranty ofAssignor.

 

Section 7.3                           Survival. Allrepresentations, warranties, covenants and agreements made by the Partieshereunder shall be considered to have been relied upon by the Parties and shallsurvive the execution, delivery and performance of this Agreement and all otherdocuments contemplated herein.

 

Section 7.4                           Successors and Assigns.This Agreement, including, without limitation, the

 

10

----

 

representations, warranties, covenants and agreements contained herein (a) shallinure to the benefit of and be enforceable by the Parties and their respectivepermitted successors, assigns and transferees, and (b) shall be bindingupon and enforceable against the Parties and their respective successors,assigns and transferees.

 

Section 7.5                           Further Assurances.Each of the Parties agrees to execute and deliver, or cause to be executed anddelivered, all such instruments, and to take all such action, as the otherParties may reasonably require in order to effectuate the intent and purposesof, and to carry out the terms of, this Agreement.

 

Section 7.6                           Costs and Expenses.Except as otherwise expressly provided herein, Assignor and Assignee shall eachbear its own costs and expenses (including but not limited to attorneys’ feesand expenses) in connection with the negotiation and preparation of thisAgreement.

 

Section 7.7                           Counterpart Execution.This Agreement may be executed in any number of counterparts, each of which,when so executed and delivered, shall be an original, but all of which togethershall constitute one Agreement binding on all of the Parties. Any signaturedelivered by facsimile or telecopier shall be deemed to constitute an originalsignature hereto.

 

Section 7.8                           Amendments; Waivers.

 

(a)                                     No amendment of any provision of thisAgreement shall be effective unless it is in writing and signed by all theParties, and no waiver of any provision of this Agreement, nor consent to anydeparture by a Party therefrom, shall be effective unless it is in writing andsigned by the other Parties, and then such waiver or consent shall be effectiveonly in the specific instance and for the specific purpose for which given.

 

(b)                                    No failure on the part of any Party to excuse,and no delay in exercising any right hereunder or under any related documentshall operate as a waiver thereof by such Party, nor shall any single orpartial exercise of any right hereunder or under any other related documentpreclude any other or further exercise thereof or the exercise of any otherright. The rights and remedies of each Party provided herein and in otherrelated documents (i) are cumulative and are in addition to, and notexclusive of, any rights or remedies provided by law, and (ii) are notconditional or contingent on any attempt by such Party to exercise any of itsrights under any other related document against the other Parties or any otherentity.

 

Section 7.9                           Governing Law. ThisAgreement shall be governed by and construed under, and the obligation of theParties hereunder shall be determined in accordance with, the laws of the Stateof California (without regard to any conflict of laws provisions thereof).

 

Section 7.10                     Notices. All demands,notices, requests, consents and communications required hereunder or under theOPA shall be in writing and shall be deemed to have been duly given ifpersonally delivered by courier service or messenger, sent by overnightdelivery service, or facsimile transmission, or deposited in the mails, bycertified or registered mail, postage prepaid, return receipt requested, to thefollowing addresses, or such other addresses as may be furnished hereafter bynotice in writing:

 

11

----

 
| To Assignee:    | Behringer  Harvard Multifamily OP I LP                            |
|-----------------|-------------------------------------------------------------------|
|            | 15601  Dallas Parkway, Suite 600                             |
|            | Addison,  Texas 75001                                             |
|            | Attention:  Mark Alfieri                                          |
|            | 469/341-2471                                                      |
|            | 214/655-1610  (FAX)                                               |
|            |                                                              |
| With a copy to: | Munsch  Hardt Kopf & Harr, P.C.                          |
|            | 3800  Lincoln Plaza                                               |
|            | 500  N. Akard                                                     |
|            | Dallas,  Texas 75201                                              |
|            | Attention:  Gregg Cleveland                                       |
|            | 214/855-7537                                                      |
|            | 214/978-4364  (FAX)                                               |
|            |                                                              |
| To Assignor:    | SF  No Ho LLC                                                     |
|            | c/o  Fairfield Residential LLC                                    |
|            | 5510  Morehouse Dr., Suite 200                               |
|            | San  Diego, California 92121                                      |
|            | Attn:  Gino A. Barra                                              |
|            | (619)  457-2123                                                   |
|            | (619)  457-3982 (FAX)                                             |
|            | email:  gbarra@ffres.com                                          |
|            |                                                              |
| With a copy to: | Meltzer,  Purtill & Stelle LLC                           |
|            | 1515  East Woodfield Rd., Second Floor                            |
|            | Schaumburg,  Illinios 60173-5431                                  |
|            | Attn:  Michael J. Wolfe                                           |
|            | (847)  330-6052                                                   |
|            | (847)  330-1231 (FAX)                                             |
|            | email:  mwolfe@mpslaw.com                                         |
|            |                                                              |
| To the CRA/LA:  | To  the address provided for notices to the CRA/LA under the OPA. |

 

All demands, requests, consents, notices andcommunications shall be deemed to have been received if addressed in the samemanner described above (i) at the time of actual delivery thereof ifdelivered by hand, by courier service or by facsimile transmission, or (ii) ifsent by overnight delivery service, then one (1) Business Day afterdeposit thereof with such delivery service, or (iii) if sent by certifiedor registered mail, then three (3) Business Days after certification orregistration thereof.

 

Section 7.11                     Integration. ThisAgreement, together with the OPA, and any exhibits attached hereto, constitutethe entire agreement and understanding between the Parties with respect to thesubject matter hereof and supersede all prior agreements, understandings orrepresentations pertaining to the subject matter hereof, whether oral orwritten. There are no representations, warranties or other agreements betweenthe Parties in connection with the subject matter hereof except as specificallyset forth or incorporated herein.

 

12

----

 

Section 7.12                     Severability. If anyprovision of this Agreement or any other agreement or document delivered inconnection herewith, is partially or completely invalid or unenforceable in anyjurisdiction, then that provision shall be ineffective in that jurisdiction tothe extent of its invalidity or un enforceability, but the invalidity or unenforceability of that provision shall not affect the validity orenforceability or any provision of this Agreement, all of which shall beconstrued and enforced as if that invalid or unenforceable provision wereomitted, nor shall the invalidity or un enforceability of that provision in onejurisdiction affect its validity or enforceability in any other jurisdiction.

 

Section 7.13                     Captions and Headings.The section captions and headings in this Agreement are for convenience ofreference only and are not intended to be full or accurate descriptions of thecontents thereof. They shall not be deemed to be part of this Agreement and inno way define, limit, extend or describe the scope or intent of any provisionshereof.

 

Section 7.14                     Agreement Effective.Notwithstanding any provision of this Agreement to the contrary, this Agreementshall become effective only upon and simultaneous with, the transfer of theProperty from Assignor to Assignee by recorded deed.

 

*[Theremainder of this page has been intentionally left blankSignatures appear on the following page.]*

 

13

----

 

IN WITNESS WHEREOF, the Parties have executedthis Agreement as of the date first set forth above.

 
| “ASSIGNOR”:                                |                                  |
|------------------------------------------------------|---------------------------------------|
|                                                 |                                  |
| SF  NO HO LLC,a California limited liability company |                                  |
|                                                 |                                  |
| By:                                                  | FF  CALIFORNIA HOUSING FUND LLC,      |   |
|                                                 | a  Delaware limited liability company |   |
|                                                 | Its:                                  | Manager |   |
|                                                 |                                  |   |   |
|                                                 | By:                                   | FF  PROPERTIES, INC., |   |
|                                                 |                                  | a  Delaware corporation |   |
|                                                 |                                  |   |   |
|                                                 |                                  | By: | /s/  Gino A. Barra |   |
|                                                 |                                  |   | Gino A. Barra |   |
|                                                 |                                  |   | Vice President |   |

 
| “ASSIGNEE”:                    |                 |
|------------------------------------------|----------------------|
|                                     |                 |
| BEHRINGER  HARVARD NOHO, LLC, a Delaware |                 |
| limited  liability company               |                 |
|                                     |                 |
| By:                                      | /s/  Mark T. Alfieri |   |
|                                     |                 |   |
| Print:                                   | Mark  T. Alfieri     |   |
|                                     |                 |   |
| Title:                                   | COO                  |   |

 

*[Signaturescontinue on the following page.]*

 

----

 
| The  State of Texas | § |   |
|---------------------|--------|--------|
|                | § |   |
| County  of Dallas   | § |   |

 

BEFORE ME, the undersigned authority, on this day personally appearedMark T. Alfieri, Chief Operating Officer, of Behringer Harvard NOHO, LLC, aDelaware limited liability company, known to me to be the person whose name issubscribed to the foregoing instrument, and acknowledged to me that he executedthe same for the purposes and consideration therein expressed, in the capacitytherein stated, and as the act and deed of said limited liability company.

 

GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the 14th day of September, 2009.

 

 
|   |   | /s/ Linda K.  Perkins |
|--------|--------|-----------------------|
|   |   | Notary  Public        |
|   |   | Linda  K. Perkins     |
|   |   |                  |
|   |   |                  |
|   |   | Seal:                 |  |

 

----

 

**CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT**

 
| State  of California                                                       |
|----------------------------------------------------------------------------|
|                                                                       |
| County  of San Diego                                                       |
|                                                                       |
| On  September 15, 2009 before me, Shannyn Daye Henkel, Notary Public, |
| Date                                                                       | Here insert Name and Title of the Officer |
|                                                                       |
| personally  appeared                                                       | Gino  A. Barra |
|                                                                       | Name(s) of Signer(s) |
| ,                                                                          |
|                                                                            |  |  |

 

[SEAL]

 

Place Notary Seal Above

 

whoproved to me on the basis of satisfactory evidence to be the person whose nameis subscribed to the within instrument and acknowledged to me that he executedthe same in his authorized capacity, and that by his signature on theinstrument the person, or the entity upon behalf of which the person acted,executed the instrument.

 

Icertify under PENALTY OF PERJURY under the laws of the State of California thatthe foregoing paragraph is true and correct.

 

WITNESSmy hand and official seal.

 
| Signature | /s/  Shannyn Daye Henkel   |   |
|-----------|----------------------------|--------|
|      | Signature of Notary Public |   |

 

***OPTIONAL***

 

*Though theinformation below is not required by law, it may prove valuable to personsrelying on the document and could prevent fraudulent removal and reattachment of this form to anotherdocument.*

 

**Description of Attached Document**

 
| Title  or Type of Document:             |   |
|-----------------------------------------|--------|
| Document  Date:                         |   | Number  of Pages: |   |
| Signer(s) Other  Than Named Above: |   |
|                                         |        |  |  |  |  |

 

**Capacity(ies) Claimed by Signer(s)**

 
| Signer’s  Name:     |                                |   |               |
|--------------------------|-------------------------------------|--------|--------------------|
| o                        | Individual                          |   |               |
| o                        | Corporate  Officer — Title(s): |   |               |   |
| o                        | Partner  — o Limited o General |   | RIGHT THUMBPRINT   |
| o                        | Attorney  in Fact                   |   | OF SIGNER          |
| o                        | Trustee                             |   | Top of thumb  here |
| o                        | Guardian  or Conservator            |   |               |
| o                        | Other:                              |   |               |   |
|                     |                                |   |               |
| Signer  Is Representing: |                                |   |               |
|                     |                                |   |
|                     |                                |   |
|                     |                                |   |               |
| Signer’s  Name:     |                                |   |               |
| o                        | Individual                          |   |               |
| o                        | Corporate  Officer — Title(s): |   |               |   |
| o                        | Partner  — o Limited o General |   | RIGHT THUMBPRINT   |
| o                        | Attorney  in Fact                   |   | OF SIGNER          |
| o                        | Trustee                             |   | Top of thumb  here |
| o                        | Guardian  or Conservator            |   |               |
| o                        | Other:                              |   |               |   |
|                     |                                |   |               |
| Signer  Is Representing: |                                |   |               |
|                     |                                |   |
|                     |                                |   |
|                          |                                     |        |                    |  |  |  |  |

 

©2007 National Notary Association · 9350 De Soto Ave., P.O. Box 2402 · Chatsworth, CA 91313-2402 · www.NationalNotary.org Item # 5907 Reorder:Call Toll-Free 1-800-876-6827

 

----

 

“THECRA/LA”

 
| THE  COMMUNITY REDEVELOPMENT AGENCY OF                 |                      |
|--------------------------------------------------------|---------------------------|
| THE  CITY OF LOS ANGELES, a public body, corporate and |                      |
| politic                                                |                      |
|                                                   |                      |   |
|                                                   |                      |   |
| By:                                                    | /s/  Authorized Signatory |   |
| Print:                                                 | Authorized  Signatory     |   |
| Its:                                                   | Regional  Administrator   |   |

 

 

APPROVEDAS TO FORM:

 

CARMENA. TRUTANICH,

CITYATTORNEY

 

 
| By:    | /s/  Authorized Signatory 9/14/09 |   |
|--------|-----------------------------------|--------|
|   | Assistant/Deputy City Attorney    |   |

 

 

APPROVEDAS TO FORM:

 

 
| By:    | /s/  Authorized Signatory |   |
|--------|---------------------------|--------|
|   | Agency Special Counsel    |   |

 

----

 

**CALIFORNIAALL-PURPOSE ACKNOWLEDGMENT**

 
| STATE  OF CALIFORNIA                                                      |
|---------------------------------------------------------------------------|
|                                                                      |
| COUNTY  OF Los Angeles                                                    |
|                                                                      |
| On  September 15, 2009 before me, Shannyn Daye Henkel, Notary Public |
|                                                                      | Name  and Title of the Officer e.g. “JANE DOE, NOTARY PUBLIC” |
|                                                                      |   |
| personally  appeared                                                      | Margarita  Hernandez Escontrias |
|                                                                      | Name(s) of Signer(s) |
|                                                                           |  |  |

 

whoproved to me on the basis of satisfactory evidence to be the person whose nameis subscribed to the within instrument and acknowledged to me that she executedthe same in her authorized capacity, and that by her signature on theinstrument the person, or the entity upon behalf of which the person acted,executed the instrument.

 

Icertify under PENALTY OF PERJURY under the laws of the State of California thatthe foregoing paragraph is true and correct

 
|       | WITNESS my hand and official seal. |   |
|------------|------------------------------------|--------|
|       |                               |   |
|       |                               |   |
|       | /s/ Shannyn Daye Henkel            |   |
|       | SIGNATURE OF NOTARY                |   |
| ** ** | ** **                         |   |
| ** ** | ** **                         |   |
| ** ** | [SEAL]                             |   |

 

 
| -OPTIONAL SECTION-                                                                                                                        |
|-------------------------------------------------------------------------------------------------------------------------------------------|
| **CAPACITY  CLAIMED BY SIGNER**                                                                                                           |
|                                                                                                                                      |
| Though  statute does not require the Notary to fill in the date below, doing so may  prove invaluable to persons relying on the document. |
|                                                                                                                                      |
| oINDIVIDUAL                                                                                                                               |
|                                                                                                                                      |
| oCORPORATE OFFICER(s)                                                                                                                     |
| ** **                                                                                                                                |
| ** **                                                                                                                                |
| TITLE(s)                                                                                                                                  |
|                                                                                                                                      |
| o PARTNERS(S                                                                                                                              | oLIMITED |
| o GENERAL                                                                                                                                 |   |
|                                                                                                                                      |   |
| o ATTORNEY-IN-FACT                                                                                                                        |   |
|                                                                                                                                      |   |
| oTRUSTEE(S)                                                                                                                               |   |
|                                                                                                                                      |   |
| oGUARDIAN/CONSERVATOR                                                                                                                     |   |
|                                                                                                                                      |   |
| oOTHER:                                                                                                                                   |   |
|                                                                                                                                      |
|                                                                                                                                      |
|                                                                                                                                      |
| **SIGNER IS  REPRESENTING**                                                                                                               |
| NAME OF PERSON(S) OR ENTITY(IES)                                                                                                     |
| ** **                                                                                                                                |

 

**OPTIONALSECTION**

 
| THIS  CERTIFICATE MUST BE ATTACHED TO THE DOCUMENT DESCRIBED AT RIGHT: |   | Title  or Type of Document:                                              . |
|------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                   |   |                                                                                                                                                                                                                                                                                                             |
|                                                                   |   | Number of Pages:       Date of Document:                        .                                                                                                    |
| Though  the data requested here is not required by law, it could       |   |                                                                                                                                                                                                                                                                                                             |
| prevent  fraudulent reattachment of this form.                         |   | Signer(s) Other  Than Named Above:                                                                                                                                                                                                                                                                          |

 

----

 

**EXHIBIT “B”**

 

Assigned Interests and Assumed Liabilities

 

(See Attached)

 

----

 

**EXHIBIT “B” TO SUBAREA “A” PARTIAL ASSIGNMENT OF OWNER PARTICIPATION AGREEMENT AND CONSENT TO ASSIGNMENT**

 

**Supplementary Comments to Assigned Interests**

 

TheAssigned Interests and Assumed Obligations shall include any and all rights,duties and obligations of the Developer under those Sections of the OPA andthose Paragraphs of that certain First Letter Agreement and the Second LetterAgreement, but only to the extent said Sections relate to, apply to, or involvethe ownership, operation and maintenance of Subarea A and the Subarea AImprovements:

 
| 102(a)         |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|----------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 103.1          |   | Assumed only to the extent necessary to confirm the  Agency’s right to pre-approve tenants pursuant to Section 103.1 of the  OPA shall not apply to residential tenants of Subarea A.                                                                                                                                                                                                                                                                                                                            |
| 103.1(a)       |   | Assumed only to the extent necessary to confirm  construction of 438 units and associated parking allowed.                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 103.1(e)(l)    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 103.1(e)(4)    |   | See also Section 6 of the Second Implementation  Agreement. Assignor assigns to Assignee the unpaid Housing Subsidy for Subarea  A payable to the Developer by the Agency, which has been calculated by the  Agency to be $1,988,276.24 per annum in accordance with the calculations set  forth in Section 103.1(e)(4). The Housing Subsidy is separately  performed for Subareas A and B-2. The annual payments of the Housing Subsidy  are scheduled to terminate at the end of Agency Fiscal Year 2028-2029. |
| 104            |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 105            |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 106            |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 106.2          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Article 2 |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 302            |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 308.1          |   | Assumed only to the extent necessary to confirm the  representations and warranties and assume the obligations of Developer under  the second, third and fourth paragraphs only of Section 308.1 of the OPA  which relate solely to the Assignee Property from and after the Effective  Date, shall be deemed to have been made and assumed by Assignee only after                                                                                                                                                    |

 

4

----

 
|   |   | the Effective Date, and Assignor shall have no  responsibility or liability therefore, except to the extent Assignor made any  such representations and warranties or assumed any such obligations before  the Effective Date for which Assignor shall remain solely liable. Further,  only to the extent it is applicable, Assignee shall assume only (i) the  right to the Agency’s reimbursement obligation in the fifth paragraph of  Section 308.1, as it relates to the Assignee Property and (ii) the  remainder of the fifth paragraph of Section 308.1 only in the event of  construction by Assignee on the Assignee Property after the Effective Date. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 308.2  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 316.1  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 318.5  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 319    |   | Assumed only to the extent necessary to confirm the  Release of Construction Covenants is conclusive evidence of the satisfactory  Completion of the construction for Subarea A and the termination of all  construction covenants.                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 509    |   | Assumed only to the extent necessary to confirm that  the representations and warranties of Developer under Section 509 of the  OPA which relate only to the use and operation of the Assignee Property by  the Assignee from and after the date of this Agreement, shall be deemed to  have been made by Assignee only after the date of this Agreement, and  Assignor shall have no responsibility or liability therefore, except for  representations and warranties made by Assignor prior to the date of this  Agreement for which Assignee shall have no responsibility or liability.                                                                                           |
| 601.2  |   | Assumed only to the extent necessary to confirm that  the Agency has certified the Project Costs which pertain to the annual return  shortfall and annual agency participation payments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 602    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 603    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 605.1  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 605.2  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 605.3  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 605.4  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 702.7  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |

 

----

 
| 801.1.2                            |   | Assumed only to the extent it applies to the  operation and use of the Assignee Property from and after the date of this  Agreement.                                                                                                                                                                              |
|------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 801.1.5                            |   |                                                                                                                                                                                                                                                                                                              |
| 801.1.6                            |   |                                                                                                                                                                                                                                                                                                              |
| 801.1.8                            |   | Assumed only to the extent necessary to confirm that  a coordinated Signage Plan may be independently prepared and implemented for  Subarea A, on the one hand, and Subareas B and C, on the other hand.                                                                                                          |
| 801.1.10                           |   |                                                                                                                                                                                                                                                                                                              |
| 801.1.11                           |   |                                                                                                                                                                                                                                                                                                              |
| 801.1.12                           |   |                                                                                                                                                                                                                                                                                                              |
| 801.1.14                           |   |                                                                                                                                                                                                                                                                                                              |
| 801.2                              |   |                                                                                                                                                                                                                                                                                                              |
| 802                                |   |                                                                                                                                                                                                                                                                                                              |
| 803.1                              |   |                                                                                                                                                                                                                                                                                                              |
| 803.2                              |   |                                                                                                                                                                                                                                                                                                              |
| 804.2                              |   |                                                                                                                                                                                                                                                                                                              |
| 1001.1                             |   |                                                                                                                                                                                                                                                                                                              |
| 1001.2                             |   |                                                                                                                                                                                                                                                                                                              |
| 1002                               |   |                                                                                                                                                                                                                                                                                                              |
| 1002.1                             |   |                                                                                                                                                                                                                                                                                                              |
| 1002.2                             |   |                                                                                                                                                                                                                                                                                                              |
| 1101 through  1109                 |   |                                                                                                                                                                                                                                                                                                              |
| 1110                               |   | Assignee makes the representations and warranties in  Paragraphs 1 thru 5 as of the Effective Date only                                                                                                                                                                                                           |
| 1111 through  1124                 |   |                                                                                                                                                                                                                                                                                                              |
| 1126                               |   |                                                                                                                                                                                                                                                                                                              |
| 1127                               |   | Assignee only assumes this section for purposes of  establishing the “Date of the Agreement”                                                                                                                                                                                                            |
| Attachment  No. 2             |   |                                                                                                                                                                                                                                                                                                              |
| Attachment  No. 3             |   |                                                                                                                                                                                                                                                                                                              |
| Attachment  No. 8             |   | The payment rights from the Agency in Sections IA,  IB, ID, IE, VI and VII with respect to Subarea A are assigned to Assignee. In  addition, the payment rights under Section II with respect to the  (Affordable Housing Subsidy) with respect to the Restricted Units provided on  Subarea A are assigned. |
| Attachment  No. 10            |   |                                                                                                                                                                                                                                                                                                              |
| **First Implementation Agreement** |   |                                                                                                                                                                                                                                                                                                              |
| l.a                                |   |                                                                                                                                                                                                                                                                                                              |

 

----

 
| 2.a                                 |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|-------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| **Second Implementation Agreement** |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 1                                   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 2                                   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 6                                   |   | See 103. l(e)(4), above. Assignor assigns to  Assignee the unpaid Housing Subsidy for Subarea A payable to the Developer by  the Agency, which has been calculated by the Agency to be $1,988,276.24 per  annum in accordance with the calculations set forth in  Section 103.1(e)(4). The Housing Subsidy is separately performed for  Subareas A and B-2. The annual payments of the Housing Subsidy are scheduled  to terminate at the end of Agency Fiscal Year 2028-2029. |
| 17                                  |   | Assignee only assumes the rights to the credit  allocated to Subarea A.                                                                                                                                                                                                                                                                                                                                                                                                             |
| 22                                  |   | Assignee only assumes the rights to the payments and  credits under Sections 1.A.2, 1.A.3, and l.B as allocated to Subarea A.                                                                                                                                                                                                                                                                                                                                                       |
| 23                                  |   | Assignee only assumes the rights to the credit  allocated to Sublease A.                                                                                                                                                                                                                                                                                                                                                                                                            |
| 24                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| **First Letter Agreement**          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 6                                   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 7                                   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 9                                   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 10                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| **Second Letter Agreement**         |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |

 

Except as otherwise expresslyprovided in this Agreement including, without limitation, Sections 4.6 and 4.7,Assignee acknowledges that it is acquiring the Property subject to thefollowing covenants and restrictions:

 

1. Agreement ContainingCovenants Affecting Real Property (Affordability Covenants) by and between SFNO HO, LLC and The Community Redevelopment Agency of the City of Los Angelesdated December 18, 2003 and recorded against the Property on December 23,2003 as Instrument No. 03-3851364.

 

2. Grant Deed from TheCommunity Redevelopment Agency of the City of Los Angeles to SF No Ho, LLCdated December 19, 2003 and recorded against the Property on December 23,2003

 

----

 

as Instrument No. 03-3851362.

 

3. Agreement ContainingCovenants Affecting Real Property by and between the Community RedevelopmentAgency of the City of Los Angeles and SF No Ho, LLC dated December 19,2003, recorded against the Property on December 23, 2003 as Instrument No. 03-3851365.

 

----

 

**EXHIBIT “C” TO SUBAREA “A” PARTIAL ASSIGNMENT OF OWNERPARTICIPATIONAGREEMENT AND CONSENT TO ASSIGNMENT**

 

**Retained Obligations**

 
| 101   |   |                    |
|-------|--------|-------------------------|
| 103.2 |   |                    |
| 107   |   |                    |
| 301   |   |                    |
| 303   |   |                    |
| 303.1 |   |                    |
| 303.2 |   |                    |
| 303.3 |   |                    |
| 303.4 |   |                    |
| 303.5 |   |                    |
| 303.6 |   |                    |
| 304   |   |                    |
| 305   |   |                    |
| 306   |   |                    |
| 306.1 |   |                    |
| 306.2 |   |                    |
| 306.3 |   |                    |
| 306.4 |   |                    |
| 306.5 |   |                    |
| 307   |   |                    |
| 308.1 |   | Paragraphs 1 and 6 only |
| 309   |   |                    |
| 310.1 |   |                    |
| 310.2 |   |                    |
| 312   |   |                    |
| 313   |   |                    |
| 314   |   |                    |
| 315   |   |                    |
| 317   |   |                    |
| 318   |   |                    |
| 318.1 |   |                    |
| 318.2 |   |                    |

 

1

----

 
| 318.2.1  |   |
|----------|--------|
| 318.2.2  |   |
| 318.2.3  |   |
| 318.2.4  |   |
| 318.3    |   |
| 318.4    |   |
| 401.2    |   |
| 401.3    |   |
| 406.2    |   |
| 601.1    |   |
| 701      |   |
| 702.1    |   |
| 702.2    |   |
| 702.3    |   |
| 702.5    |   |
| 702.6    |   |
| 703.1    |   |
| 703.2    |   |
| 703.3    |   |
| 703.4    |   |
| 703.5    |   |
| 801.1.1  |   |
| 801.1.7  |   |
| 801.1.9  |   |
| 801.1.13 |   |
| 804.1    |   |
| 1002.3   |   |
| 1003.1   |   |
| 1004     |   |
| 1004.1   |   |
| 1004.2   |   |
| 1004.3   |   |
| 1004.4   |   |
| 1005     |   |
| 1125     |   |

 

2

----

 
| Attachment No. 7               |   |                                                                                         |
|-------------------------------------|--------|----------------------------------------------------------------------------------------------|
| Attachment No. 9               |   |                                                                                         |
| Attachment No. 11              |   |                                                                                         |
| Attachment No. 12              |   |                                                                                         |
|                                |   |                                                                                         |
| **First Implementation Agreement**  |   |                                                                                         |
| 3                                   |   |                                                                                         |
| 4                                   |   |                                                                                         |
|                                |   |                                                                                         |
| **Second Implementation Agreement** |   |                                                                                         |
| 7                                   |   | Assignee retains only the obligations in the first  paragraph which were assumed by Assignor |
| 9                                   |   |                                                                                         |
| 10                                  |   |                                                                                         |
| 11                                  |   | See Section 310.1.                                                                      |
| 12                                  |   |                                                                                         |
| 13                                  |   |                                                                                         |
| 16                                  |   |                                                                                         |
| 18                                  |   |                                                                                         |
| 19                                  |   |                                                                                         |
| 21                                  |   |                                                                                         |
|                                |   |                                                                                         |
| **Letter Agreement**                |   |                                                                                         |
| 5                                   |   |                                                                                         |
| 8                                   |   |                                                                                         |
| 9                                   |   |                                                                                         |

 

3

----