Document:

Exhibit 4.4

 

AMENDED AND RESTATED

SHARE REDEMPTION PROGRAM

OF

BEHRINGER HARVARD MULTIFAMILY
REIT I, INC.

 

This amended and restated share redemption program, effective as of November 11,
2009 (our “Program”), is intended to provide limited interim liquidity for our
stockholders until a bona fide secondary market develops for our shares of
common stock (the “Shares”).  No such
market presently exists, and we can provide no assurance that any market for
the Shares will ever develop.

 

Prior to the time that a bona fide secondary market for our Shares has
developed, stockholders who meet the applicable requirements, as described
herein, may receive the benefit of limited liquidity by presenting for
redemption all or a portion of their Shares to us at any time in accordance
with the procedures outlined herein.  At
that time, we may, subject to the conditions and the Redemption Limitations
described below, redeem for cash such Shares. 
The terms on which we redeem Shares may differ between redemptions upon
the death or “qualifying disability” (as defined herein) of the stockholder or
requests for redemption sought upon a stockholder’s confinement to a long-term
care facility (collectively referred to herein as “Exceptional Redemptions”)
and all other redemptions (referred to herein as “Ordinary Redemptions”).

 

Ordinary
Redemptions

 

In the case of Ordinary Redemptions, the purchase price per Share for
the redeemed Shares will equal 90% of (i) the most recently disclosed
estimated value per Share (the “Valuation”) as determined in accordance with
our valuation policy (the “Valuation Policy”), as such Valuation Policy is
amended from time to time, less (ii) the aggregate distributions per Share
of any net sale proceeds from the sale of one or more of our assets, or other
special distributions so designated by our Board of Directors (our “Board”),
distributed to stockholders after the Valuation was determined (the “Valuation
Adjustment”); provided, however, that the purchase price per Share shall not
exceed: (1) prior to the first Valuation conducted by the Board, or a
committee thereof (the “Initial Board Valuation”), under the Valuation Policy,
90% of (i) the Original Share Price (as defined herein) less (ii) the
aggregate distributions per Share of any net sale proceeds from the sale of one
or more of our assets, or other special distributions so designated by the
Board, distributed to stockholders prior to the redemption date (the “Special Distributions”);
or (2) on or after the Initial Board Valuation, the Original Share Price
less any Special Distributions.  As used
herein “Original Share Price” means the average price per Share the original
purchaser or purchasers of Shares paid to us for all of his or her Shares (as
adjusted for any stock dividends, combinations, splits, recapitalizations and
the like with respect to our common stock).

 

Exceptional
Redemptions

 

In addition, and subject to the conditions and limitations described
below, we may redeem Shares upon the death of a stockholder who is a natural
person, including Shares held by the stockholder through a revocable grantor
trust, or an IRA or other retirement or profit-sharing plan, after receiving
written notice from the estate of the stockholder, the recipient of the Shares
through bequest or inheritance, or, in the case of a revocable grantor trust,
the trustee of the trust, having the sole ability to request redemption on
behalf of the trust.  We must, however,
receive the written notice within one year after the death of the
stockholder.  Requests not received
within the one-year period will not be eligible to be treated as a redemption
request in connection with the death of a stockholder, but instead will be
treated as an Ordinary Redemption.  If
spouses are joint registered holders of Shares, the request to redeem the
Shares may be made if either of the registered holders dies.  If the stockholder is not a natural person,
such as a trust (other than a revocable grantor trust), partnership,
corporation or other similar entity, the right of redemption upon death does
not apply.

 

Furthermore, and subject to the conditions and limitations described
below, we may redeem Shares held by a stockholder who is a natural person with
a qualifying disability, or upon confinement to a long-term care facility,
including Shares held by the stockholder through a revocable grantor trust, or
an IRA or other retirement or profit-sharing plan, after receiving written
notice from the stockholder, provided that the condition causing the qualifying
disability was not pre-existing on the date that the stockholder became a
stockholder or that the stockholder seeking redemption was not confined to a
long-term care facility on the date the person became a stockholder.  We must, however, receive the written notice
within one year after the determination of the stockholder’s qualifying
disability or with respect to redemptions sought upon a stockholder’s
confinement to a long-term care facility, within one year of the earlier of (1) the
one year anniversary of the stockholder’s admittance to the long-term care
facility or (2) the

 

 

date of the
determination of the stockholder’s indefinite confinement to the long-term care
facility by a licensed physician. 
Requests not received within the one-year period will not be eligible to
be treated as a redemption request in connection with a qualifying disability
of a stockholder or confinement to a long-term care facility, but instead will
be treated as an Ordinary Redemption.  If
the stockholder is not a natural person, such as a trust (other than a
revocable grantor trust), partnership, corporation or other similar entity, the
right of redemption described in this paragraph does not apply.

 

In order for a disability to be considered a “qualifying disability,” (1) the
stockholder must receive a determination of disability based upon a physical or
mental condition or impairment arising after the date the stockholder acquired
the Shares to be redeemed, and (2) the determination of disability must be
made by the governmental agency responsible for reviewing the disability
retirement benefits that the stockholder could be eligible to receive (the “applicable
governmental agency”).  The “applicable
governmental agencies” are limited to the following: (a) if the
stockholder paid Social Security taxes and therefore could be eligible to
receive Social Security disability benefits, then the applicable governmental
agency is the Social Security Administration or the agency charged with
responsibility for administering Social Security disability benefits at that time
if other than the Social Security Administration; (b) if the stockholder
did not pay Social Security benefits and therefore could not be eligible to
receive Social Security disability benefits, but the stockholder could be
eligible to receive disability benefits under the Civil Service Retirement
System (CSRS), then the applicable governmental agency is the U.S. Office of
Personnel Management or the agency charged with responsibility for
administering CSRS benefits at that time if other than the Office of Personnel
Management; or (c) if the stockholder did not pay Social Security taxes
and therefore could not be eligible to receive Social Security benefits but
suffered a disability that resulted in the stockholder’s discharge from
military service under conditions that were other than dishonorable and
therefore could be eligible to receive military disability benefits, then the
applicable governmental agency is the Veteran’s Administration or the agency
charged with the responsibility for administering military disability benefits
at that time if other than the Veteran’s Administration.

 

Disability determinations by governmental agencies for purposes other
than those listed above, including but not limited to worker’s compensation
insurance, administration or enforcement of the Rehabilitation Act or Americans
with Disabilities Act, or waiver of insurance premiums, will not entitle a
stockholder to the terms available for Exceptional Redemptions, unless
permitted in the discretion of our Board. 
Redemption requests following an award by the applicable governmental
agency of disability benefits must be accompanied by (1) the stockholder’s
initial application for disability benefits and (2) a Social Security
Administration Notice of Award, a U.S. Office of Personnel Management
determination of disability under CSRS, a Veteran’s Administration record of
disability-related discharge or such other documentation issued by the
applicable governmental agency that we deem acceptable and demonstrates an
award of the disability benefits.

 

We understand that the following disabilities do not entitle a worker
to Social Security disability benefits:

 

·                  disabilities occurring after the legal retirement age;

 

·                  temporary disabilities; and

 

·                  disabilities that do not render a worker incapable of
performing substantial gainful activity.

 

Therefore,
these disabilities will not qualify for the terms available for Exceptional
Redemptions.  However, where a
stockholder requests the redemption of his or her Shares due to a disability
and the stockholder does not have a “qualifying disability” under the terms
described above, but has become subject to similar circumstances, our Board may
redeem the stockholder’s Shares, in its sole discretion, on the terms available
for Exceptional Redemptions.

 

With respect to Exceptional Redemptions sought upon a stockholder’s
confinement to a long-term care facility, a “long-term care facility” shall
mean an institution that: (1) either (a) is approved by Medicare as a
provider of skilled nursing care or (b) is licensed as a skilled nursing
home by the state or territory in which it is located (it must be within the
United States, Puerto Rico, or U.S. Virgin Islands) and (2) meets all of
the following requirements: (a) its main function is to provide skilled,
intermediate or custodial nursing care; (b) it provides continuous room
and board to three or more persons; (c) it is supervised by a registered
nurse or licensed practical nurse; (d) it keeps daily medical records of
all medication dispensed; and (e) its primary service is other than to
provide housing for residents.  A
stockholder seeking an Exceptional Redemption of his or her Shares due to
confinement to a long-term care facility must submit a written statement from a
licensed physician certifying either (1) the stockholder’s continuous and
continuing confinement to a long-term care facility over the course of the last

 

2

 

year or (2) that
the licensed physician has determined that the stockholder will be indefinitely
confined to a long-term care facility. 
Notwithstanding the above, where a stockholder requests an Exceptional
Redemption of his or her Shares due to confinement to a long-term care facility
but does not meet the definition set forth above, but has become subject to
similar circumstances, our Board may redeem the stockholder’s Shares, in the
Board’s sole discretion, on the terms available for Exceptional Redemptions.

 

In the case of Exceptional Redemptions, the purchase price per Share
will be equal to: (1) prior to the Initial Board Valuation, the Original
Share Price less any Special Distributions; or (2) on or after the Initial
Board Valuation, the most recently disclosed Valuation less any Valuation
Adjustment, provided, however, that the purchase price per Share shall not
exceed the Original Share Price less any Special Distributions.

 

General Terms
for Redemption

 

Our Program, whether for Ordinary Redemptions or Exceptional
Redemptions, is available only for stockholders who have held their Shares for
at least one year and who acquired their Shares directly from us or the
transferees mentioned below, and is not intended to provide liquidity to any
stockholder who acquired his or her Shares by purchase from another
stockholder.  In connection with a
request for redemption, the stockholder or his or her estate, heir or
beneficiary will be required to certify to us that the stockholder either (1) acquired
the Shares requested to be repurchased directly from us or (2) acquired
the Shares from the original subscriber by way of a bona fide gift not for
value to, or for the benefit of, a member of the subscriber’s immediate or
extended family (including the subscriber’s spouse, parents, siblings, children
or grandchildren and including relatives by marriage) or through a transfer to
a custodian, trustee or other fiduciary for the account of the subscriber or
members of the subscriber’s immediate or extended family in connection with an
estate planning transaction, including by bequest or inheritance upon death or
operation of law.

 

For purposes of the one-year holding period, limited partners of
Behringer Harvard Multifamily OP I LP (“Behringer Harvard Multifamily OP I”)
who exchange their limited partnership units for Shares will be deemed to have
owned their Shares as of the date they were issued their limited partnership
units in Behringer Harvard Multifamily OP I.

 

We will not redeem Shares that are subject to liens or other
encumbrances until the stockholder presents evidence that the liens or
encumbrances have been removed.  If any
Shares subject to a lien are inadvertently redeemed or we shall otherwise be
required to pay to any other party all or any amount in respect of the value of
redeemed Shares, then the recipient of amounts in respect of redemption shall
repay to us the amount paid for such redemption up to the amount we are
required to pay to such other party.

 

Notwithstanding the redemption prices established above, the Board may
determine, whether pursuant to formulae or processes approved by our Board or
otherwise set by our Board, the redemption price of the Shares, which may
differ between Ordinary Redemptions and Exceptional Redemptions; provided,
however, that we must provide at least 30 days’ notice to stockholders before applying
the new price that is set pursuant to this sentence to either Ordinary
Redemptions or Exceptional Redemptions.

 

Any Shares approved for redemption will be redeemed on a periodic basis
as determined from time to time by our Board, and no less frequently than
annually. We will not redeem, during any twelve-month period, more than 5% of
the weighted average number of Shares outstanding during the twelve-month
period immediately prior to the date of redemption (the “5% Limitation”). Generally,
the cash available for redemption on any particular date will be limited to the
proceeds from our distribution reinvestment plan (our “DRP”) during the period consisting
of the preceding four fiscal quarters for which financial statements are
available, less any cash already used for redemptions during the same period, plus,
if we had positive operating cash flow during such preceding four fiscal
quarters, 1% of all operating cash flow during such preceding four fiscal
quarters (the “Funding Limitation” and, together with the 5% Limitation, the “Redemption
Limitations”).  The Redemption
Limitations apply to all redemptions, whether Ordinary or Exceptional
Redemptions.

 

Our Board reserves the right in its sole discretion at any time and
from time to time to (1) waive the one-year holding requirement applicable
to exigent circumstances such as bankruptcy, a mandatory distribution
requirement under a stockholder’s IRA or with respect to Shares purchased under
or through our DRP, (2) reject any request for redemption, (3) change
the purchase price for redemptions, (4) limit the funds to be used for
redemptions hereunder or otherwise change the Redemption Limitations or (5) amend,
suspend (in whole or in part) or terminate the Program.  If we suspend our Program (in whole or in
part), except as otherwise provided by the Board, until the suspension is
lifted, we will not accept any requests for redemption in respect of Shares to
which such suspension

 

3

 

applies in
subsequent periods and any such requests and all pending requests that are
subject to the suspension will not be honored or retained, but will be returned
to the requestor.  Our advisor and its
affiliates will defer their own redemption requests, if any, until all other
requests for redemption have been satisfied in any particular period.  Provided that a request for an Exceptional
Redemption is made within one year of the event giving rise to eligibility for
an Exceptional Redemption, we will waive the one-year holding requirement (a) upon
the request of the estate, heir or beneficiary of a deceased stockholder or (b) upon
the qualifying disability of a stockholder or upon a stockholder’s confinement
to a long-term care facility, provided that the condition causing such
disability or need for long-term care was not preexisting on the date that such
person became a stockholder.

 

A request for redemption may be withdrawn in whole or in part by a
stockholder in writing at any time prior to redemption.  We cannot guarantee that we will accommodate
all requests made in any particular redemption period.  If we do not redeem all Shares presented for
redemption during any period, the stockholder or his or her estate, heir or
beneficiary can (1) withdraw the request for redemption, or (2) if we
have not suspended the redemption of the Shares that are subject to the
redemption request (in which case the request will be returned as provided
above), ask that we honor the request during the next period in which requests
are considered.  Further, if we do not
redeem all Shares presented for redemption during any period in which we are
redeeming Shares, then all Shares will be redeemed on a pro rata basis during
the relevant period.  Any portion of a
redemption request that is not honored will be automatically treated as a
request for redemption during the next period in which requests will be
considered, unless the stockholder seeking redemption affirmatively asks us to
withdraw that portion of the request. 
The stockholder will then be required to resubmit a request for
redemption request.  Unless otherwise
determined by the Board, we will not retain any redemption requests that are
withdrawn.

 

In general, a stockholder or his or her estate, heir or beneficiary may
present to us fewer than all of the Shares then owned for redemption, except
that the minimum number of Shares that must be presented for redemption must be
at least 25% of the holder’s Shares.  If,
however, redemption is being requested (1) within the one-year timeframe
discussed above, on behalf of a deceased stockholder or by a stockholder with a
qualifying disability or who is confined to a long-term care facility or (2) by
a stockholder due to other exigent circumstances, such as bankruptcy or a
mandatory distribution requirement under such stockholder’s IRA, a minimum of
10% of the stockholder’s Shares may be presented for redemption; provided,
however, that any future redemption request by the stockholder must present for
redemption at least 25% of the stockholder’s remaining Shares.  Except in the case of redemptions due to a
mandatory distribution under a stockholder’s IRA, we will treat a redemption
request that would cause a stockholder to own fewer than 200 Shares as a
request to redeem all of his or her Shares, and we will vary from pro rata
treatment of redemptions as necessary to avoid having stockholders holding
fewer than 200 Shares.  In the case of
stockholders who undertake a series of partial redemptions, appropriate
adjustments in the purchase price for the redeemed Shares will be made so that
the blended price per Share for all redeemed Shares reflects the Original Share
Price of all Shares owned by the stockholder through the dates of each
redemption.

 

A stockholder who wishes to have Shares redeemed must mail or deliver
to us a written request on a form provided by us and executed by the
stockholder, its trustee or authorized agent. 
An estate, heir or beneficiary that wishes to have Shares redeemed
following the death of a stockholder must mail or deliver to us a written
request on a form provided by us, including evidence acceptable to our Board of
the death of the stockholder, and executed by the executor or executrix of the
estate, the heir or beneficiary, or their trustee or authorized agent.  A stockholder requesting the redemption of
his or her Shares due to a qualifying disability or confinement to a long-term
care facility must mail or deliver to us a written request on a form provided
by us, including the evidence and documentation described above, or evidence
acceptable to our Board of the stockholder’s permanent disability or
confinement to a long-term care facility. 
If the Shares are to be redeemed under the conditions outlined herein,
we will forward the documents necessary to affect the redemption, including any
signature guaranty we may require.

 

The effective date of any redemption (the “Effective Date”), and the
date on which the purchase price per Share is determined, calculated in
accordance with the procedures discussed herein, will be the last day of the
calendar month preceding the date that the Board accepts the request for
redemption (the “Determination Date”). 
Commencing on the Effective Date, any Shares accepted for redemption
will no longer be deemed outstanding and will no longer be eligible to receive
distributions.  Our Board will consider
only properly completed redemption requests that we received on or before the
end of the period ending no later than the last day of the calendar month preceding
the Determination Date.  Payment for the
Shares so approved for redemption, assuming that we have not exceeded the
Redemption Limitations and that all necessary conditions have been satisfied,
will be made no later than 15 days after the Determination Date.

 

4

 

Subject to the restrictions in Behringer Harvard Multifamily OP I’s
limited partnership agreement and any other applicable agreement, we may cause
Behringer Harvard Multifamily OP I to offer to its limited partners (other than
our subsidiaries, BHMF, Inc. and BHMF Business Trust) a partnership unit
redemption program equivalent to our Program. 
Any units redeemed under the partnership unit redemption program will be
redeemed upon terms substantially equivalent to the redemption terms of our
Program and will be treated as Shares for purposes of calculating the
Redemption Limitations.

 

Neither our advisor, any member of our Board nor any of their
affiliates will receive any fee on the repurchase of Shares by us pursuant to
our Program. The Shares we purchase under our Program will be cancelled, and
will have the status of authorized but unissued Shares.  We will not reissue repurchased Shares unless
they are first registered with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, and under appropriate state securities laws
or otherwise issued in compliance with or exemption from registration under
these laws.

 

The foregoing provisions regarding our Program in no way limit our
ability to repurchase Shares or other of our securities or those of Behringer
Harvard Multifamily OP I from holders thereof by any other legally available
means for any reason that the advisor or our Board, each in its discretion, deems
to be in our best interest.

 

5Exhibit 10.17

 

RECORDING REQUESTED BY

CHICAGO TITLE COMPANY

 

RECORDING REQUESTED BY

AND WHEN RECORDED RETURN TO:

 

L. Anthony Beall, Esquire

Troutman Sanders LLP

P.O. Box 1122

Richmond, Virginia 23218-1122

 

59023906

 

ASSUMPTION AGREEMENT

 

 

Freddie Mac Loan No. 002669129

Waterford Place Apartments

 

ASSUMPTION AGREEMENT

(for use with electronic mortgage documents only)

Revision Date 7-15-09

 

THIS ASSUMPTION
AGREEMENT is made effective as of the 25th day of August, 2009, by and among WATERFORD PLACE APARTMENTS, LLC, a
California limited liability company (“Original
Borrower”); BEHRINGER HARVARD
WATERFORD PLACE REIT, LLC, a Delaware limited liability company (“New Borrower”); and the FEDERAL HOME LOAN MORTGAGE CORPORATION (“Noteholder”) and is acknowledged and
consented to by J. F. SHEA CO., INC.,
a Nevada corporation (“Original Guarantor”).

 

RECITALS

 

A.                     Original
Borrower obtained a mortgage loan (the “Loan”)
from Berkshire Mortgage Finance Limited Partnership, a Massachusetts limited
partnership (“Original Lender”),
which loan is secured by certain Land and Improvements (the “Property”), located in Alameda County,
California. The Land is more particularly described in Exhibit A,
attached to this Agreement.

 

B.                       Original
Borrower executed a promissory note evidencing the Loan, dated April 1,
2004,, in the original principal amount of $52,000,000.00, payable to Original
Lender (the “Note”). The Original
Guarantor guaranteed payment of certain amounts due under the Note by executing
a Guaranty dated April 1, 2004 (the “Original
Guaranty”),

 

C.                       To secure
repayment of the Loan, Original Borrower executed and delivered to Original
Lender a Multifamily Deed of Trust, Assignment of Rents, Security Agreement and
Fixture Filing (the “Security Instrument”)
of even date with the Note, which
is recorded in the Official Records in the County of Alameda, State of
California (the “Land Records”) as
Instrument No. 2004-159476. Any capitalized terms used in this Agreement
and not defined shall have the meaning ascribed to them in the Security
Instrument.

 

D.                      The Note,
Security Instrument and any other document executed by Original Borrower in
connection with the Loan that will be assumed by New Borrower, all as listed on
Exhibit B to this Agreement, are referred to collectively in this
Agreement as the “Loan Documents”.

 

E.                        Original
Lender endorsed the Note to the order of the Noteholder and by instrument dated
April 1, 2004 filed for record on April 15, 2004 in the Land Records
as Instrument No. 2004-159477 sold, assigned and transferred all right,
title and interest of the Original Lender in and to the Security Instrument and
the Loan Documents to the Noteholder. The Noteholder is now the owner and
holder of the Note and the Loan is serviced by Deutsche Bank Berkshire Mortgage, Inc.,
a Delaware corporation (the “Servicer”).

 

ASSUMPTION AGREEMENT

Multifamily - For Use with Electronic Mortgage
Documents (7/15/2009)

 

 

F.                        Original
Borrower has transferred or has agreed to transfer all of its right, title, and
interest in and to the Property to New Borrower (the “Transfer”).

 

G.                       New
Borrower has agreed to assume all of Original Borrower’s rights, obligations,
and liabilities created or arising under the Loan Documents, with certain
modifications, if any, as set forth in Exhibit C to this Agreement
(the “Assumption”).

 

H.                      Subject to
the full satisfaction of all conditions set forth below, the Noteholder has
agreed to consent to New Borrower’s Assumption.

 

I.                           Original
Borrower desires to be released by the Noteholder from any and all obligations
and liabilities under the terms and provisions of the Loan Documents, and
Noteholder has agreed to release Original Borrower from liability as provided
in Section 16 of this Agreement.

 

NOW, THEREFORE, in
consideration of these premises, the mutual covenants contained in this
Agreement and other good and valuable consideration, the receipt and
sufficiency of which are acknowledged,
the parties agree as follows:

 

1.                          Assumption
of Obligations. New Borrower covenants, promises and agrees that New
Borrower, jointly and severally if more than one, will unconditionally assume
and be bound by all terms, provisions, and covenants of the Loan Documents set
forth in Exhibit B to this Agreement, as if New Borrower had been
the original maker of the Loan Documents. New Borrower will pay all sums to be
paid and perform each and every obligation to be performed by Original Borrower
under and in accordance with the terms and conditions of the Loan Documents.

 

2.                          Affirmation
by New Borrower. New Borrower agrees that the Loan Documents set forth in Exhibit B
to this Agreement are and will be and remain in full force and effect,
enforceable against New Borrower in accordance with their terms, except as
modified by Exhibit C to this Agreement. The Property will remain
subject to the lien, charge and encumbrance of the Security Instrument. Nothing
contained in this Agreement or done pursuant to this Agreement will affect or
be construed to affect the lien, charge, and encumbrance of the Security
Instrument or the priority of the Security Instrument over other liens, charges
and encumbrances. Nothing contained in this Agreement or done pursuant to this
Agreement will release or be construed to release or affect the liability of
any party or parties who may now or after the date of this Agreement be liable
under or on account of the Note and the Security Instrument, except as
expressly provided in this Agreement. New Borrower will be liable for the
payment of all sums and the performance of every obligation required under the Loan
Documents to the extent set forth in the Loan Documents as modified by this
Agreement.

 

3.                          Subordination
of Rights of Original Borrower and New Borrower. Any indebtedness of
Original Borrower to New Borrower, or of New Borrower to Original Borrower, now
or existing after the date of this Agreement, together with any interest on
such debt, is hereby subordinated to any indebtedness of Original Borrower or
New Borrower to the Noteholder under the Loan Documents. Any collection or
receipts with respect to any such indebtedness of Original Borrower to New
Borrower, or of New Borrower to Original Borrower, will be collected, enforced
and received by New Borrower or Original Borrower (as applicable) in

 

2

 

trust for the benefit of
the Noteholder, and will be paid over to the Noteholder on account of the
indebtedness of Original Borrower and New Borrower to the Noteholder, but
without impairing or affecting in any manner the liability of Original Borrower
or New Borrower under the other provisions of the Loan Documents and this
Agreement. However, until the occurrence of an Event of Default under the
Security Instrument, Original Borrower or New Borrower (as applicable) will be
entitled to retain for its own account all payments made on account of the
principal of and interest on any such indebtedness; provided no such payment is
made more than ten (10) days in advance of the due date.

 

4.                          Modification
of Note and Security Instrument. New Borrower and Noteholder agree that the
provisions of the Loan Documents are modified as set forth on  Exhibit C to this Agreement.

 

5.                          Replacement Reserve. New Borrower and  Noteholder agree that a Replacement Reserve Fund will be
established with Servicer with payments to be made by New Borrower to such
account in the amount of Six Thousand Five Hundred and 00/100 Dollars
($6,500.00) per month, in accordance with the terms and provisions of the
Replacement Reserve Agreement to be executed by New Borrower and Noteholder on
the same date as this Agreement.

 

6.                          Repairs. No Repairs are required and no Repair Escrow will be established as
of the date of this Agreement. Original Borrower acknowledges and agrees that
Noteholder is not holding any funds pursuant to the Repair Escrow, if any, executed
by Original Borrower.

 

7.                          Escrows for Taxes, Insurance and Other
Charges. On or prior to the
execution of this Agreement, to ensure that sufficient funds are available for
the payment of real estate taxes, an escrow account will be established with
Servicer, with payments to be made by New Borrower to such account in the
amount required by Noteholder and/or Servicer. New Borrower will not be
required to establish and pay escrows for (i) fire, hazard or other
insurance premiums, (ii) water and sewer charges and (iii) assessments
or other charges (the “Impositions”); however, New Borrower and New Guarantor,
if any, will be personally liable for any loss or damage as the result of New
Borrower’s failure to pay any Imposition. The Note is hereby amended as set
forth in Exhibit C to evidence the personal liability of New
Borrower and New Guarantor (as defined below) for any taxes, hazard insurance,
flood insurance, ground rent or such other charges or assessments for which no
escrow is being collected, but which are not timely paid. By execution of this
Agreement, Original Borrower acknowledges and agrees that it relinquishes any
right, title or interest it has or may have in any escrow account held by
Servicer in connection with the Property.

 

8.                          Guaranty Requirements. On the date of execution of this Agreement,
Behringer Harvard Multifamily REIT I, Inc., a Maryland corporation
(jointly and severally if more than one, “New
Guarantor”) will execute and deliver to Noteholder the appropriate
version of the Guaranty (the “Guaranty”)
under which the New Guarantor guarantees the full and punctual payment when due
of the “Guaranteed Obligations” (as such term is defined in the Guaranty). The
Guaranty will provide that New Guarantor is personally liable for zero percent
(0%) of the outstanding principal balance of the Loan. New Guarantor
automatically will become liable for one hundred percent (100%) of all amounts
payable under the Loan Documents upon the occurrence of certain events more
specifically set forth in the Guaranty.

 

9.                          Original Guaranty Released. The original guaranty under which the
Original Guarantor guaranteed payments of certain amounts under the Loan
Documents (“Original Guaranty”) is
released and will not have any force or effect, all as more fully provided in Section 16
below.

 

3

 

10.                    Representations
and Acknowledgements. Original Borrower, New Borrower and Noteholder
acknowledge that:

 

a)                          As of the date of this Agreement, the
amount of the unpaid indebtedness under the Note is Forty-Seven Million Three
Hundred Ninety-Eight Thousand Six Hundred One and 91/100 Dollars
($47,398,601.91).

 

b)                         Interest at the rate set forth in the
Note has been paid to Noteholder in full through and including August 31,2009.

 

Original Borrower
represents and warrants to Noteholder that:

 

a)                          All of the representations and warranties
in the Loan Documents are true as of the date on which Original Borrower
executes this Agreement.

 

b)                         No Event of Default (or event which, with
the giving of notice or the passage of time or both, would be an Event of
Default) has occurred or is continuing under the Security Instrument.

 

c)                          Original Borrower has no claims, offsets,
defenses, or counterclaims of any kind to its performance under, or Noteholder’s
enforcement of, the Note and the other Loan Documents; and to the extent any
such counterclaims, setoffs, defenses or other causes of action may exist,
whether known or unknown, Original Borrower waives all such items. Original
Borrower acknowledges that all of Noteholder’s actions in connection with the
Loan have been in compliance with the terms of the applicable Loan Documents,
and Original Borrower acknowledges and agrees that Noteholder has not breached
or failed to perform any duty or obligation that Noteholder may owe Original
Borrower.

 

d)                         There are no suits or actions pending or,
to the knowledge of Original Borrower after diligent inquiry threatened against
Original Borrower which affect the enforcement or validity of the Note, the Security
Instrument and/or the Loan Documents.

 

11.                    Additional
Transfers. Notwithstanding the Noteholder’s consent to the Transfer of the
Property to New Borrower, New Borrower understands and agrees that such consent
will in no way limit or operate as a waiver of the Noteholder’s continuing
rights under Section 21 of the Security Instrument.

 

12.                    Continuing
Obligations. New Borrower will execute, acknowledge and deliver an
Operations and Maintenance Plan for mold and such other documents as
Noteholder, or Servicer may require to document the Assumption described in
this Agreement and to more fully effectuate the provisions of this Agreement.
The failure of New Borrower to comply with the additional obligations contained
in this Section will constitute an Event of Default under the Security
Instrument, and the Noteholder will be entitled to exercise all remedies
available to it under the terms of the Loan Documents.

 

13.                    Additional
Obligations.

 

a)                        To induce the Noteholder to consent to
New Borrower’s Assumption, in addition to the covenants and agreements set
forth in the Loan Documents, New Borrower

 

4

 

agrees that it will
comply with the Additional Obligations set forth on Exhibit D to
this Agreement, if applicable.

 

b)                       The failure
of New Borrower to comply with the Additional Obligations, if applicable, will
constitute an Event of Default under the Security Instrument, and the
Noteholder will be entitled to exercise all remedies available to it under the
terms of the Loan Documents.

 

14.                    Release of
Original Borrower; Rights of Noteholder.

 

a)                        Original
Borrower is released from liability under the terms and provisions of the Loan
Documents, all as more fully provided in Section 16 below. If any material
element of Original Borrower’s representations and warranties are materially
false or misleading, this release will be canceled and Original Borrower will
remain obligated under the Loan Documents as though there had been no release.

 

b)                       If at any
time all or any part of any payment by Original Borrower which has been applied
by the Noteholder to payment of the Loan is or must be rescinded, repaid or
returned by the Noteholder for any reason whatsoever (including, without
limitation, the application of any bankruptcy, insolvency or other law), for
purposes of this Agreement, to the extent that such payment is or must be
rescinded, repaid or returned, such payment will be deemed to have continued to
be due and payable, notwithstanding such application by the Noteholder and this
Agreement will continue to be effective as to such payment as though such
application by the Noteholder had not been made. Original Borrower and New
Borrower will each remain liable to the Noteholder for the amount so rescinded,
repaid, or returned to the same extent as if such amount had never originally
been received by the Noteholder, notwithstanding any cancellation of the Note,
release or satisfaction of the Security Instrument, or the cancellation of any
other Loan Document.

 

15.                    Expenses.
New Borrower’s execution of this Agreement will constitute New Borrower’s
agreement to pay all expenses incurred by the Noteholder in connection with
this Assumption, including without limitation the payment of any title
endorsement costs, legal costs (including in-house legal costs) attorney’s
fees, and assumption fees required by the Noteholder.

 

16.                    Release.

 

a)                        Release
of Original Borrower and Original Guarantor. Noteholder and Servicer each
fully, finally, and forever releases and discharges Original Borrower and
Original Guarantor (collectively, the “Original
Loan Parties”), and their successors, assigns, members, managers,
directors, officers, employees, agents and representatives from any and all
actions, causes of action, claims, debts, demands, liabilities, obligations,
and suits, of whatever kind or nature, in law or equity, that Noteholder and
Servicer have or in the future may have, whether known or unknown in respect of
the Loan, the Loan Documents, or the acts or omissions of the Original Loan Parties
in respect of the Loan or the Loan Documents (the “Released Claims”). Noteholder and Servicer agree that the
above release shall be effective as a full and final release of each and every
matter specifically and generally referred to above. Notwithstanding the
foregoing, (i) the Released Claims shall not include, and nothing
contained in this Section

 

5

 

16(a) shall be
deemed to be a release of the Original Loan Parties and their successors and
assigns from, any liability and obligations of any Original Loan Party (i) arising
pursuant to this Agreement, (ii) resulting from the fraud or any material
misrepresentation of any Original Loan Party, or (iii) arising from any
and all actions, causes of action, claims, debts, demands, liabilities,
obligations, and suits, of whatever kind or nature, in law or equity, that
Noteholder or Servicer have or in the future may have, whether known or unknown
in connection with the ownership or operation of Units 2, 3 and 4 as shown on
the Condominium Instruments.

 

b)                       Release
of Lenders. The Original Loan Parties each fully, finally, and forever
releases and discharges Noteholder and Servicer, and their successors, assigns,
members, managers, directors, officers, employees, agents and representatives
from any and all actions, causes of action, claims, debts, demands,
liabilities, obligations, and suits, of whatever kind or nature, in law or
equity, that the Original Loan Parties have or in the future may have, whether
known or unknown in respect of the Loan, the Loan Documents, or the acts or
omissions of the Noteholder or Servicer in respect of the Loan or the Loan
Documents (the “Lenders’ Released Claims”).
The Original Loan Parties each agree that the above release shall be effective
as a full and final release of each and every matter specifically and generally
referred to above. Notwithstanding the foregoing, (i) the Lenders’
Released Claims shall not include, and nothing contained in this Section 16(b) shall
be deemed to be a release of the Noteholder or Servicer and their successors
and assigns from, any liability and obligations of Noteholder or Service (i) arising
pursuant to this Agreement, or (ii) resulting from the fraud or any
material misrepresentation of Noteholder or Servicer.

 

c)                        General
Release. Each of the Original Loan Parties, Noteholder and Servicer, having
consulted with their respective counsel, is aware of the contents of Section 1542
of the Civil Code of the State of California. Section 1542 reads as follows:

 

Section 1542.
(General Release - Claims Extinguished.) A general release does not extend to
claims which the creditor does not know or suspect to exist in his or her favor
at the time of executing the release, which if known by him or her must have
materially affected his or her settlement with the debtor.

 

Noteholder and Servicer
each expressly waives and relinquishes all rights and benefits under that
section and any law or legal principle of similar effect in any jurisdiction,
with respect to the Released Claims. Noteholder has executed this Agreement
voluntarily, with full knowledge of its significance, and with the express
intention of effecting the legal consequences provided by a waiver of
California Civil Code Section 1542.

 

Each of the Original Loan
Parties expressly waives and relinquishes all rights and benefits under that
section and any law or legal principle of similar effect in any jurisdiction,
with respect to the Lenders’ Released Claims. Each of the Original Loan Parties
has executed this Agreement voluntarily, with full knowledge of its
significance, and with the express intention of effecting the legal
consequences provided by a waiver of California Civil Code Section 1542.

 

6

 

17.                    Miscellaneous.

 

a)                        This
Agreement will be binding upon and  will
inure to the benefit of the parties to the Agreement and their respective
heirs, successors and permitted assigns.

 

b)                       Except as
expressly modified by this Agreement, the Note, the Security Instrument and all
other Loan Documents will be unchanged and remain in full force and effect, and
are hereby expressly approved, ratified and confirmed. No provision of this
Agreement that is held to be inoperative, unenforceable or invalid will affect
the remaining provisions, and to this end all provisions of this Agreement are
declared to be severable.

 

c)                        Time is of
the essence of this Agreement.

 

d)                       This
Agreement may not be changed orally, but only by an agreement in writing,
signed by the party against whom enforcement of any waiver, change,
modification or discharge is sought.

 

e)                        This
Agreement will be construed in accordance with the laws of the jurisdiction in
which the Property is located.

 

f)                          This
Agreement may be executed in counterparts, each of which will be deemed an
original, but all of which together will constitute one and the same document.

 

g)                       All notices
given pursuant to the Agreement must be in writing and will be effectively
given if personally delivered or, if mailed, postage prepaid, certified or
registered mail, return receipt requested, to the addresses of the parties set
forth below or to such other address as any party subsequently may designate in
writing.

 

h)                       The failure
of New Borrower to comply with the additional obligations contained in this
Agreement will constitute an Event of Default under the Security Instrument,
and the Noteholder will be entitled to exercise all remedies available to it
under the terms of the Loan Documents.

 

18.                    Executed
Originals. An executed original of this Agreement will be (i) attached
permanently to the Note as an amendment to the Note, and (ii) recorded in
the Land Records as a modification to the Security Instrument.

 

19.                    State
Specific Requirements. N/A.

 

ATTACHED
EXHIBITS. The following Exhibits are attached to this
Instrument:

 

	
  x Exhibit A

  	
  Legal Description of
  the Land (required).

  
	
   

  	
   

  
	
  x Exhibit B

  	
  List of Loan Documents
  (required).

  
	
   

  	
   

  
	
  x Exhibit C

  	
  Modifications to Note
  and Security Instrument, (required).

  
	
   

  	
   

  
	
  o Exhibit D

  	
  Additional Obligations
  of New Borrower – [check box if applicable]

  

 

7

 

	
  x Exhibit E

  	
  Modification to
  Assumption Agreement Borrower – [check box
  if applicable]

  

 

IN WITNESS
WHEREOF, the parties have executed this Agreement as of the date written above.

 

8

 

	
   

  	
  ORIGINAL
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  WATERFORD PLACE APARTMENTS, LLC, a

  California limited liability company

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Shea
  Properties Management Company, Inc., a Delaware corporation, its manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ James G. Shontere

  
	
   

  	
   

  	
   

  	
  James G. Shontere

  
	
   

  	
   

  	
   

  	
  Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Robert R. O’Dell

  
	
   

  	
   

  	
   

  	
  Robert R. O’Dell

  
	
   

  	
   

  	
   

  	
  Treasurer

  

 

 

Address for Notice to
Original Borrower:

 

c/o J. F. Shea Co., Inc.

655 Brea Canyon Road 

Walnut, California 91789

 

9

 

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT

 

	
  State of California

  	
   

  
	
   

  	
   

  
	
  County of Los Angeles

  	
   

  
	
   

  	
   

  
	
  On August 14, 2009
  before me,

  	
  Christine Rodriguez,
  Notary Public,

  
	
                   DATE

  	
  NAME, TITLE OF OFFICER-
  E.G. JANE DOE, NOTARY PUBLIC personally appeared

  
	
  James G. Shontere,

  
	
  NAME(S) OF
  SIGNER(S)

  

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

 

I certify under PENALTY
OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.

 

WITNESS my hand and official
seal.

 

 

	
  [SEAL]

  	
   

  	
  /s/ Christine Rodriguez

  
	
   

  	
   

  	
  Signature of Notary

  

 

 

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT

 

	
  State of California

  	
   

  
	
   

  	
   

  
	
  County of Los Angeles

  	
   

  
	
   

  	
   

  
	
  On August 14, 2009
  before me,

  	
  Christine Rodriguez,
  Notary Public,

  
	
                   DATE

  	
  NAME, TITLE OF OFFICER-
  E.G. JANE DOE, NOTARY PUBLIC personally appeared

  
	
  Robert R. O’Dell,

  
	
  NAME(S) OF
  SIGNER(S)

  

who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or the entity
upon behalf of which the person(s) acted, executed the instrument.

 

I certify under PENALTY
OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.

 

WITNESS my hand and
official seal.

 

 

	
  [SEAL]

  	
   

  	
  /s/ Christine Rodriguez

  
	
   

  	
   

  	
  Signature of Notary

  

 

10

 

	
   

  	
  NEW BORROWER:

  
	
   

  	
   

  
	
   

  	
  BEHRINGER HARVARD WATERFORD PLACE
  REIT, LLC, a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Behringer
  Harvard Waterford Place Venture, LLC, a Delaware limited liability company,
  its manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Behringer
  Harvard Waterford Place, LLC, a Delaware limited liability company, its
  manager

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Mark T. Alfieri

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Mark T. Alfieri

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Operating Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Tax identification
  number for New Borrower:

  
	
   

  	
  27-0318723

  
	
   

  	
   

  
	
   

  	
  Address for Notice to
  New Borrower:

  
	
   

  	
   

  
	
   

  	
  15601 Dallas Parkway,
  Suite 600

  Addison, Texas 75001

  

 

11

 

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT

 

	
  State of Texas

  	
   

  
	
   

  	
   

  
	
  County of Dallas

  	
   

  
	
   

  	
   

  
	
  On August 19, 2009
  before me,

  	
  Mary Lee Hackedorn, Notary
  Public,

  
	
                    DATE

  	
  NAME, TITLE OF OFFICER-
  E.G. JANE DOE, NOTARY PUBLIC personally appeared

  
	
  Mark T. Alfieri,

  
	
  NAME(S) OF
  SIGNER(S)

  

who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or the entity
upon behalf of which the person(s) acted, executed the instrument.

 

I certify under PENALTY
OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.

 

WITNESS my hand and
official seal.

 

 

	
  [SEAL]

  	
   

  	
  /s/ Mary Lee Hackedorn

  
	
   

  	
   

  	
  Signature of Notary

  

 

12

 

	
   

  	
  CONSENTED
  TO BY NOTEHOLDER:

  
	
   

  	
   

  
	
   

  	
  FEDERAL
  HOME LOAN MORTGAGE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David J. Goozman

  
	
   

  	
   

  	
  Name:

  	
  David J. Goozman

  
	
   

  	
   

  	
  Title:

  	
  Manager of Multifamily
  Portfolio Services

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notice to Noteholder:

  
	
   

  	
   

  
	
   

  	
  8200 Jones Branch Drive

  McLean, Virginia 22102-3110

  

 

 

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT

 

	
  State of Virginia

  	
   

  
	
   

  	
   

  
	
  County of Fairfax

  	
   

  
	
   

  	
   

  
	
  On August 24, 2009
  before me,

  	
  Jennifer Lam, Notary
  Public,

  
	
                DATE

  	
  NAME, TITLE OF OFFICER-
  E.G. JANE DOE, NOTARY PUBLIC personally appeared

  
	
  David J. Goozman,

  
	
  NAME(S) OF
  SIGNER(S)

  

who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or the entity
upon behalf of which the person(s) acted, executed the instrument.

 

I certify under PENALTY
OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.

 

WITNESS my hand and
official seal.

 

 

	
   

  	
   

  	
  /s/ Jennifer Michelle
  Lam

  
	
   

  	
   

  	
  Signature of Notary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [SEAL]

  

 

13

 

	
   

  	
  ACKNOWLEDGED
  AND CONSENTED TO:

  
	
   

  	
   

  
	
   

  	
  ORIGINAL
  GURANTOR:

  
	
   

  	
   

  
	
   

  	
  J. F.
  SHEA CO., INC., a
  Nevada corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James G. Shontere

  
	
   

  	
   

  	
  James G. Shontere

  
	
   

  	
   

  	
  Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert R. O’Dell

  
	
   

  	
   

  	
  Robert R. O’Dell

  
	
   

  	
   

  	
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
  Address for Notice to
  Original Guarantor:

  
	
   

  	
   

  
	
   

  	
  655 Brea Canyon Road

  Walnut, California 91789

  

 

 

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT

 

	
  State of California

  	
   

  
	
   

  	
   

  
	
  County of Los Angeles

  	
   

  
	
   

  	
   

  
	
  On August 14, 2009
  before me,

  	
  Christine Rodriguez,
  Notary Public,

  
	
               DATE

  	
  NAME, TITLE OF OFFICER-
  E.G. JANE DOE, NOTARY PUBLIC personally appeared

  
	
  James G. Shontere &
  Robert R. O’Dell,

  
	
  NAME(S) OF
  SIGNER(S)

  

who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) are
subscribed to the within instrument and acknowledged to me that they executed
the same in their authorized capacity(ies), and that by their signature(s) on
the instrument the person(s), or the entity upon behalf of which the person(s) acted,
executed the instrument.

 

I certify under PENALTY
OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.

 

WITNESS my hand and
official seal.

 

 

	
  [SEAL]

  	
   

  	
  /s/ Christine Rodriguez

  
	
   

  	
   

  	
  Signature of Notary

  

 

14

 

CALIFORNIA ALL-PURPOSE
ACKNOWLEDGMENT

 

	
  State of                                    

  	
   

  
	
   

  	
   

  
	
  County of                                    

  	
   

  
	
   

  	
   

  
	
  On
                                      before
  me,

  	
                                                                                                                         ,

  
	
   

  	
  DATE

  	
  NAME, TITLE OF OFFICER- E.G. JANE DOE, NOTARY PUBLIC
  personally appeared

  
	
                                                                                                                         ,

  
	
  NAME(S) OF SIGNER(S)

  
			

who proved to me on the basis of satisfactory evidence
to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity, and that by his/her/their signature(s) on
the instrument the person(s), or the entity upon behalf of which the person(s) acted,
executed the instrument.

 

I certify under PENALTY OF PERJURY under the laws of
the State of California that the foregoing paragraph is true and correct.

 

WITNESS my hand and official seal.

 

 

	
   

  	
   

  
	
   

  	
  Signature of Notary

  

 

15

 

	
   

  	
  NEW GUARANTOR:

  
	
   

  	
   

  
	
   

  	
  BEHRINGER
  HARVARD MULTIFAMILY REIT I, INC., a Maryland corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark T. Alfieri

  
	
   

  	
   

  	
  Name: Mark T. Alfieri

  
	
   

  	
   

  	
  Title: Chief Operating Officer

  
	
   

  	
   

  
	
   

  	
  Address for Notice to New Guarantor:

  
	
   

  	
   

  
	
   

  	
  15601 Dallas Parkway, Suite 600

  Addison, Texas 75001

  

 

 

CALIFORNIA ALL-PURPOSE
ACKNOWLEDGMENT

 

	
  State of Texas

  	
   

  
	
   

  	
   

  
	
  County of Dallas

  	
   

  
	
   

  	
   

  
	
  On August 19, 2009 before me,

  	
  Mary Lee Hackedorn, Notary Public,

  
	
   

  	
  DATE

  	
  NAME, TITLE OF OFFICER- E.G. JANE DOE, NOTARY PUBLIC
  personally appeared

  
	
  Mark T. Alfieri,

  
	
  NAME(S) OF SIGNER(S)

  
			

who proved to me on the basis of satisfactory evidence
to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity (ies), and that by his/her/their signature(s) on
the instrument the person(s), or the entity upon behalf of which the person(s) acted,
executed the instrument.

 

I certify under PENALTY OF PERJURY under the laws of
the State of California that the foregoing paragraph is true and correct.

 

WITNESS my hand and official seal.

 

 

	
  [SEAL]

  	
  /s/ Mary Lee Hackedorn

  
	
   

  	
  Signature of Notary

  

 

16

 

EXHIBIT
B

 

REQUIRED

 

(List
of Loan Documents that will be Assumed)

 

1.                          Multifamily
Note dated as of April 1, 2004 in the original principal amount of
$52,000,000.00 by Original Borrower to Original Lender.

 

2.                          Multifamily
Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing dated
as of April 1, 2004, by Original Borrower for the benefit of Original
Lender.

 

B-1

 

EXHIBIT
C

 

REQUIRED

 

(Changes
to Loan Documents)

 

Modifications to all Loan
Documents

 

As used in the Loan Documents, all references to
Borrower will be deemed to refer to New Borrower.

 

All modifications currently set forth in Exhibit A
to the Note and Exhibit B to the Security Instrument are hereby deleted.

 

Modification to Note:

 

1.                          Section 9(c)(iv) is
deleted in its entirety and restated as follows:

 

(iv)                Borrower
fails to pay when due the amount of any item below marked “Deferred” in
accordance with the terms of the Security Instrument; provided however, that if
no item is marked “Deferred”, this Section 9(c)(iv) shall be of no
force or effect.

 

	
  [Deferred]

  	
  Hazard Insurance premiums or other insurance
  premiums,

  
	
  [Collect]

  	
  Taxes,

  
	
  [Deferred]

  	
  water and sewer charges (that could become a lien on
  the Mortgaged Property),

  
	
  [N/A]

  	
  ground rents,

  
	
  [Deferred]

  	
  assessments or other charges (that could become a
  lien on the Mortgaged Property)

  

 

Modifications to Security
Instrument:

 

1.                          The
second sentence of Section 4(e) is modified to read as follows:

 

All Leases for residential dwelling units shall be on
forms approved by Lender, shall be for initial terms of at least three
months and not more than two years, and shall not include options to
purchase; provided, however, that as many as 2.5
percent of the total units in the Mortgaged Property may be leased on a
month-to-month basis as corporate units at any one time.

 

2.                          Section 14(a) is
modified to read as follows:

 

Borrower shall keep and maintain at all times at the
Mortgaged Property or the management agent’s office, and upon Lender’s request
shall make available at the Mortgaged Property (or, at Borrower’s option, at
the management agent’s office or at the corporate offices of Behringer Harvard
Multifamily Management Services, LLC, in Addison, Texas), complete and accurate
books of account and records (including copies

 

C-1

 

of supporting bills and invoices) adequate to reflect
correctly the operation of the Mortgaged Property, and copies of all written
contacts, Leases, and other instruments which affect the Mortgaged Property; provided, however,
that each of the following must be maintained on and available at the
Mortgaged Property:

 

i.                            lease
files,

ii.                         information
regarding the leasing status of each unit,

iii.                      documentation
regarding marketing efforts,

iv.                     the
Moisture Management Plan (MMP),

v.                        all
operations & maintenance (O&M) plans,

vi.                     lead-based
paint (LBP) compliance documentation, and

vii.                  income
compliance reports for income-restricted units.

 

The books, records, contracts, Leases and other
instruments shall be subject to examination and inspection by Lender at any
reasonable time.

 

3.                          Sections
I9(a), (b) and (c) of the Security Instrument are deleted and replaced
with the following:

 

(a)                    Borrower
shall keep the Improvements insured at all times against such hazards as Lender
may from time to time require, which insurance shall include but not be limited
to coverage against loss by fire, windstorm and allied perils, general boiler
and machinery coverage, and business interruption including loss of rental
value insurance for the Mortgaged Property with extra expense insurance. If
Lender so requires, such insurance shall also include sinkhole insurance, mine
subsidence insurance, earthquake insurance, and, if the Mortgaged Property does
not conform to applicable zoning or land use laws, building ordinance or law
coverage. In the event any updated reports or other documentation are
reasonably required by Lender in order to determine whether such additional
insurance is necessary or prudent, Borrower shall pay for all such
documentation at its sole cost and expense. Borrower acknowledges and agrees
that Lender’s insurance requirements may change from time to time throughout
the term of the Indebtedness. If any of the Improvements is located in an area
identified by the Federal Emergency Management Agency (or any successor to that
agency) as an area having special flood hazards, Borrower shall insure such
Improvements against loss by flood. All insurance required pursuant to this Section 19(a) shall
be referred to as “Hazard Insurance.” All policies of Hazard Insurance must
include a non-contributing, non-reporting mortgage clause in favor of, and in a
form approved by, Lender.

 

(b)                   All
premiums on insurance policies required under this Section 19 shall be
paid in the manner provided in Section 7, unless Lender has designated in
writing another method of payment. All such policies shall also be in a form
approved by Lender. Borrower shall deliver to Lender a legible copy of each
insurance policy (or duplicate original) and Borrower shall promptly deliver to
Lender a copy of all renewal and other notices received by Borrower with
respect to the policies and all receipts for paid premiums. At least 5 days
prior to the expiration date of any insurance policy, Borrower shall deliver to
Lender evidence acceptable to Lender that the policy has been renewed. If
Borrower has not delivered a legible copy of each renewal policy (or a duplicate
original) prior to the expiration date of any

 

C-2

 

insurance policy, Borrower shall deliver a legible
copy of each renewal policy (or a duplicate original) in a form satisfactory to
Lender within 120 days after the expiration date of the original policy.

 

(c)                    Borrower
shall maintain at all times commercial general liability insurance, workers,
compensation insurance and such other liability, errors and omissions and
fidelity insurance coverages as Lender may from time to time require. All
policies for general liability insurance must contain a standard additional
insured provision, in favor of, and in a form approved by, Lender.

 

4.                          Section 21(c)(vii) is hereby
deleted in its entirety.

 

5.                          Section 21(e)(vii) is modified to
read as follows:

 

(vii)             a Transfer of any interest in a Controlling
Entity which, if such Controlling Entity were Borrower, would result in an
Event of Default under any of the Sections 2l(e)(i) through (vi), above; provided,
however, that the following will not constitute an Event of
Default:

 

A.                      a Transfer under Section 2l(e)(v) with
respect to Behringer Harvard Multifamily REIT I, Inc., a Maryland
corporation (“BH REIT I”), or

B.                        a Transfer under Section 21(e)(ii)(B) with
respect to Behringer Harvard Multifamily OP I LP, a Delaware limited
partnership (“BHMOP”),

 

but only if in each case (X) Behringer Harvard
Multifamily Advisors I LP, a Texas limited partnership (the “Advisor”) is
managing the day-to-day operations, either internally or externally, of BH REIT
I or BHMOP, as applicable, and (Y) there is not a Transfer of a
Controlling Interest in the Advisor; provided, however, that
it will not be an Event of Default if a Transfer of the Advisor is made to BH
REIT I or BHMOP.

 

6.                          A
new Section 53 is hereby added as follows:

 

“53.           CONDOMINIUM PROVISIONS.

 

(a)                      Borrower represents and warrants that, to the
best of its knowledge, the  Mortgaged
Property is a condominium (the “Condominium”) and constitutes all of Unit 1 (as
defined in the Condominium Instruments) and a 97% tenancy-in-common interest in
the common elements comprising the Waterford Place Condominiums, a Condominium,
as established under the applicable Condominium Act codified in California
Civil Code Sections 1350 et seq., as from time to time amended the “Condominium
Act”). The Declaration, as recorded in the official records of Alameda County,
State of California as Document No, 2003653881, Bylaws and Plats establishing
and describing the Condominium, are collectively referred to below as the “Condominium
Instruments.”

 

(b)                     Borrower hereby agrees that the Condominium
Instruments will not be modified or amended without the prior written consent
of Lender until the Indebtedness has been paid in full.

 

C-3

 

(c)                      Borrower
represents and warrants that none of the units in Unit 1 and its 97%
tenancy-in-common interest in the common elements comprising the Condominium
have been sold, conveyed or encumbered or are subject to any agreement to
convey or encumber. Borrower agrees that it will not in any way pledge, sell,
convey or encumber or enter into a contract or agreement to pledge, sell,
convey or encumber any unit in Unit 1 or any of its 97% tenancy-in-common
interest in the common elements of the Condominium unless expressly agreed to
in writing by Lender.

 

(d)                     Borrower agrees that it
shall own, operate and maintain the Mortgaged Property in accordance with the
terms of this Instrument and operate the Mortgaged Property solely as a rental
apartment project.

 

(e)                      The Mortgaged Property
granted, conveyed and assigned to Lender hereunder shall include all rights,
easements, rights of way, reservations and powers of the Borrower under the
Condominium Act and the Condominium Instruments in Borrower’s capacity as owner
of the Mortgaged Property and as Declarant as well as any rights that Borrower
may have, in any capacity, under the Condominium Act and the Condominium
Instruments in addition to Borrower’s rights as owner of any of the units or
the Condominium, specifically including but not limited to all rights to
approve any amendments to the Condominium instruments and all rights to expand
the Condominium.

 

(f)                        Borrower hereby irrevocably
constitutes and appoints Lender as Borrower’s proxy and attorney-in-fact (which
appointment shall be deemed coupled with an interest) for and in its behalf to
perform all of the obligations of Borrower and to exercise all of the rights
and powers of Borrower under the Condominium Instruments without any liability
therefor or thereunder (except for gross negligence or willful misconduct).
Borrower hereby instructs and grants and gives to Lender full power and
authority to do and perform all and every act and thing whatsoever authorized,
permitted, requisite or necessary to be done by Borrower under the provisions
of the Condominium Instruments to all intents and purposes the same as Borrower
might do, hereby ratifying and confirming all such attorney shall lawfully do
or choose to do or be done by virtue hereof, it being understood and agreed
that the aforesaid provisions impose no burden or obligation on the Lender to
do or perform any act whatsoever. It shall be a default under this Instrument
if (i) Borrower terminates or revokes or attempts to terminate or revoke
the aforesaid appointment of Lender as Borrower’s proxy or attorney-in-fact
either permanently or as to any election in the Condominium Act or Condominium
Instruments or (ii) Borrower attempts to modify the terms of the
Condominium Instruments without the prior written consent of Lender.
Notwithstanding anything in this paragraph to the contrary, the rights and
powers of Borrower granted in this paragraph may not be exercised by Lender
prior to the occurrence of an Event of Default.

 

(g)                     Borrower hereby agrees that
it shall maintain insurance in accordance with Lender’s requirements on all of
the Mortgaged Property, including any common areas.

 

C-4

 

(h)                     Nothing
contained herein is intended to or shall be construed to constitute Lender as
the “Declarant” under the Condominium Act and/or the Condominium Instruments or
as owner of the Condominium, a partner or joint venturer of Borrower.

 

(i)                         Borrower
hereby agrees to indemnify and hold Lender harmless from and against any and
all losses, cost, liabilities, or damages (including attorney’s fees and
disbursements) arising out of (i) the failure of the Borrower to comply
with any state or local law, ordinance, statute, or regulation by any
governmental authority covering the condominium at the Mortgaged Property; or (ii) any
claim of any unit owner or tenant of any unit owner as a result of any
violation, breach, misrepresentation, fraud, act, or omission of any obligation
of Borrower as set forth in the Condominium Instruments.

 

7.                          A
new Section 54 is hereby added as follows:

 

54.                  MOISTURE
MANAGEMENT PLAN AND MOLD.

 

Borrower must have or must establish and must adhere
to a moisture management plan (an “MMP”). The Borrower must keep all MMP
documentation at the Mortgaged Property or at the management agent’s office and
available for the Lender or the Loan Servicer to review during any annual
assessment or other inspection of the Mortgaged Property that is required by
Lender.

 

If Lender determines that Mold has developed at the
Mortgaged Property as a result of a water intrusion event or leak, Lender, at
Lender’s discretion, may require that a professional inspector inspect the
Mortgaged Property as frequently as Lender determines is necessary until any
issue with Mold and its cause(s) are resolved to Lender’s satisfaction.
Such inspection shall be limited to a visual and olfactory inspection of the
area that has experienced the water intrusion event, leak or Mold. Borrower
shall be responsible for the cost of such professional inspection and any
remediation deemed to be necessary as a result of the professional inspection.
After any issue with Mold, water intrusion or leaks is remedied to Lender’s
satisfaction, Lender shall not be entitled to require a professional inspection
any more frequently than once every three years unless Lender is otherwise
aware of subsequent Mold as a result of a water intrusion event or leak.

 

If Lender or Loan Servicer determines not to conduct
an annual inspection of the Mortgaged Property, and in lieu thereof Lender
requests a certification, Borrower shall be prepared to provide and must
actually provide to Lender a factually correct certification each year that the
annual inspection is waived to the following effect:

 

Borrower has not received any written complaint,
notice, letter or other written communication from tenants, management agent or
governmental authorities regarding odors, indoor air quality, mold, fungus,
microbial contamination or pathogenic organisms (“Mold”) or any activity,
condition, event or omission that causes or facilitates the growth of Mold on
or in any part of the

 

C-5

 

Mortgaged Property or if Borrower has received any
such written complaint, notice, letter or other written communication that
Borrower has investigated and determined that no Mold activity, condition or
event exists or alternatively has fully and properly remediated such activity,
condition, event or omission in compliance with the Moisture Management Plan
for the Mortgaged Property.

 

If Borrower is unwilling or unable to provide such
certification, Lender may require a professional inspection of the Mortgaged
Property at Borrower’s expense.

 

C-6

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