Document:

exv10w16

 

Exhibit 10.16

 

 

LOAN AGREEMENT

between

THE ENTITIES IDENTIFIED AS BORROWERS PARTY

HERETO,

as Borrowers

THE LENDERS PARTY HERETO,

as Lenders

and

GENERAL ELECTRIC CAPITAL CORPORATION,

as Administrative Agent

As of November 30, 2005

 

 

Property Locations:

Attached as Exhibit B

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	1. CERTAIN DEFINITIONS
	 	 	1	 
	2. THE LOAN
	 	 	15	 
	2.1 General
	 	 	15	 
	2.2 Interest Rate; Late Charge
	 	 	17	 
	2.3 Terms of Payment
	 	 	17	 
	2.4 Security
	 	 	19	 
	2.5 Capital Improvements Reserve
	 	 	19	 
	2.6 Required Reserves
	 	 	20	 
	2.7 Payments; Pro Rata Treatment; Etc
	 	 	21	 
	2.8 Yield Protection; Etc
	 	 	24	 
	3. SPECIAL PORTFOLIO PROVISIONS
	 	 	29	 
	3.1 Net Cash Flow Sweep
	 	 	29	 
	3.2 Reserved
	 	 	29	 
	3.3 Reserved
	 	 	29	 
	3.4 Reserved
	 	 	29	 
	3.5 Reserved
	 	 	29	 
	3.6 Early Loan Acceleration
	 	 	29	 
	3.7 Reserved
	 	 	29	 
	3.8 Reserved
	 	 	29	 
	3.9 Release of Projects
	 	 	29	 
	3.10 Substitution of Projects
	 	 	33	 
	4. INSURANCE, CONDEMNATION, AND IMPOUNDS
	 	 	35	 
	4.1 Insurance
	 	 	35	 
	4.2 Use and Application of Insurance Proceeds
	 	 	37	 
	4.3 Condemnation Awards
	 	 	38	 
	4.4 Impounds
	 	 	38	 
	5. ENVIRONMENTAL MATTERS
	 	 	39	 
	5.1 Certain Definitions
	 	 	39	 
	5.2 Representations and Warranties on Environmental Matters
	 	 	40	 
	5.3 Covenants on Environmental Matters
	 	 	40	 
	5.4 Allocation of Risks and Indemnity
	 	 	43	 

(i)

 

	 	 	 	 	 
	 	 	Page	 
	5.5 No Waiver
	 	 	43	 
	6. LEASING MATTERS
	 	 	44	 
	6.1 Representations and Warranties on Leases
	 	 	44	 
	6.2 Standard Lease Form; Approval Rights
	 	 	44	 
	6.3 Covenants
	 	 	44	 
	6.4 Tenant Estoppels
	 	 	45	 
	7. REPRESENTATIONS AND WARRANTIES
	 	 	45	 
	7.1 Organization and Power
	 	 	45	 
	7.2 Validity of Loan Documents
	 	 	45	 
	7.3 Liabilities; Litigation
	 	 	45	 
	7.4 Taxes and Assessments
	 	 	46	 
	7.5 Other Agreements; Defaults
	 	 	46	 
	7.6 Compliance with Law and Covenants
	 	 	46	 
	7.7 Location of Borrowers
	 	 	47	 
	7.8 ERISA
	 	 	47	 
	7.9 Margin Stock
	 	 	47	 
	7.10 Tax Filing
	 	 	47	 
	7.11 Solvency
	 	 	47	 
	7.12 Full and Accurate Disclosure
	 	 	47	 
	7.13 Single Purpose Entity
	 	 	48	 
	7.14 Ownership of the Project; Liens
	 	 	49	 
	7.15 Parking
	 	 	49	 
	7.16 Forfeiture
	 	 	49	 
	7.17 Flood Zone
	 	 	50	 
	7.18 Reserved
	 	 	50	 
	7.19 Reserved
	 	 	50	 
	7.20 Structure Chart
	 	 	50	 
	8. FINANCIAL REPORTING
	 	 	50	 
	8.1 Financial Statements
	 	 	50	 
	8.2 Accounting Principles
	 	 	51	 
	8.3 Other Information; Access
	 	 	51	 
	8.4 Annual Budgets
	 	 	51	 
	8.5 Audits
	 	 	51	 

(ii)

 

	 	 	 	 	 
	 	 	Page	 
	9. COVENANTS
	 	 	51	 
	9.1 Due on Sale and Encumbrance; Transfers of Interests
	 	 	51	 
	9.2 Taxes; Utility; Charges
	 	 	52	 
	9.3 Control; Management
	 	 	52	 
	9.4 Operation; Maintenance; Inspection; Use
	 	 	52	 
	9.5 Taxes on Security
	 	 	53	 
	9.6 Legal Existence; Name, Etc
	 	 	53	 
	9.7 Affiliate Transactions
	 	 	53	 
	9.8 Limitation on Other Debt
	 	 	54	 
	9.9 Further Assurances
	 	 	54	 
	9.10 Estoppel Certificates
	 	 	54	 
	9.11 Notice of Certain Events
	 	 	54	 
	9.12 Indemnification
	 	 	54	 
	9.13 Payment for Labor and Materials
	 	 	55	 
	9.14 Immediate Repairs and Capital Improvements
	 	 	55	 
	9.15 Contribution Agreement
	 	 	55	 
	9.16 Interest Rate Protection Agreement
	 	 	55	 
	9.17 Post-Closing Obligations
	 	 	56	 
	10. EVENTS OF DEFAULT
	 	 	56	 
	10.1 Payments
	 	 	56	 
	10.2 Insurance
	 	 	56	 
	10.3 Sale, Encumbrance, Etc
	 	 	56	 
	10.4 Covenants
	 	 	57	 
	10.5 Representations and Warranties
	 	 	57	 
	10.6 Other Encumbrances
	 	 	57	 
	10.7 Involuntary Bankruptcy or Other Proceeding
	 	 	57	 
	10.8 Voluntary Petitions, etc
	 	 	57	 
	10.9 Reserved
	 	 	57	 
	11. REMEDIES
	 	 	57	 
	11.1 Remedies — Insolvency Events
	 	 	57	 
	11.2 Remedies — Other Events
	 	 	58	 
	11.3 Administrative Agent’s Right to Perform the Obligations
	 	 	58	 
	11.4 Cross-Default; Cross-Collateralization; Waiver of Marshalling of Assets
	 	 	59	 

(iii)

 

	 	 	 	 	 
	 	 	Page	 
	12. MISCELLANEOUS
	 	 	59	 
	12.1 Notices
	 	 	59	 
	12.2 Amendments and Waivers
	 	 	60	 
	12.3 Limitation on Interest
	 	 	60	 
	12.4 Invalid Provisions
	 	 	61	 
	12.5 Reimbursement of Expenses
	 	 	61	 
	12.6 Approvals; Third Parties; Conditions
	 	 	62	 
	12.7 Administrative Agent Not in Control; No Partnership
	 	 	62	 
	12.8 Time of the Essence
	 	 	63	 
	12.9 Successors and Assigns
	 	 	63	 
	12.10 Secondary Market Transaction
	 	 	63	 
	12.11 Evidence of Indebtedness
	 	 	64	 
	12.12 Renewal, Extension or Rearrangement
	 	 	64	 
	12.13 Waivers
	 	 	64	 
	12.14 Cumulative Rights
	 	 	64	 
	12.15 Singular and Plural
	 	 	64	 
	12.16 Phrases
	 	 	64	 
	12.17 Exhibits and Schedules
	 	 	65	 
	12.18 Titles of Articles, Sections and Subsections
	 	 	65	 
	12.19 Promotional Material
	 	 	65	 
	12.20 Survival
	 	 	65	 
	12.21 Waiver of Jury Trial
	 	 	65	 
	12.22 Waiver of Punitive or Consequential Damages
	 	 	66	 
	12.23 Governing Law; Jurisdiction and Venue
	 	 	66	 
	12.24 Entire Agreement
	 	 	67	 
	12.25 Counterparts
	 	 	67	 
	12.26 Contest of Certain Claims
	 	 	67	 
	12.27 Assignments and Participations
	 	 	68	 
	13. LIMITATIONS ON LIABILITY
	 	 	69	 
	13.1 Limitation on Liability
	 	 	69	 
	13.2 Limitation on Liability of Administrative Agent’s and the Lenders’
Officers, Employees, etc
	 	 	71	 
	14. ANTI-MONEY LAUNDERING AND INTERNATIONAL TRADE CONTROLS
	 	 	71	 

(iv)

 

	 	 	 	 	 
	 	 	Page	 
	14.1 Compliance with International Trade Control Laws and OFAC Regulations
	 	 	71	 
	14.2 Borrowers’ Funds
	 	 	71	 
	14.3 Borrower Compliance with Patriot Act
	 	 	72	 
	14.4 Cooperation with Administrative Agent
	 	 	72	 
	14.5 Additional Events of Default
	 	 	72	 
	14.6 Representations and Warranties True and Correct
	 	 	72	 
	14.7 Actions Taken Pursuant to Anti-Money Laundering Laws
	 	 	73	 
	15. THE ADMINISTRATIVE AGENT
	 	 	73	 
	15.1 Appointment, Powers and Immunities
	 	 	73	 
	15.2 Reliance by Administrative Agent
	 	 	74	 
	15.3 Defaults
	 	 	74	 
	15.4 Rights as a Lender
	 	 	74	 
	15.5 Standard of Care; Indemnification
	 	 	74	 
	15.6 Non-Reliance on Administrative Agent and Other Lenders
	 	 	75	 
	15.7 Failure to Act
	 	 	75	 
	15.8 Resignation of Administrative Agent
	 	 	75	 
	16. MULTIPLE OBLIGORS
	 	 	76	 
	16.1 Multiple Mortgages and Notes
	 	 	76	 
	16.2 Waivers
	 	 	77	 
	16.3 Full Knowledge
	 	 	79	 
	16.4 Deferral of Reimbursement
	 	 	79	 
	16.5 Deferral of Subrogation and Contribution
	 	 	79	 
	16.6 Lender’s Disgorgement of Payments
	 	 	79	 

(v)

 

LIST OF EXHIBITS AND SCHEDULES

	 	 	 
	Exhibit A

	 	Legal Description of the Projects
	Exhibit B

	 	Location of the Projects
	Exhibit C

	 	Form of Promissory Note
	Exhibit D

	 	Allocated Loan Amounts
	Exhibit E

	 	Form of Assignment and Acceptance
	Exhibit F

	 	List of Management Agreements
	Exhibit G

	 	Structure Chart
	Exhibit H

	 	Reserved
	Exhibit I

	 	Form of Interest Rate Protection Pledge
	Exhibit J

	 	Defeasance
	Schedule 1

	 	Commitments
	Schedule 2

	 	Guaranties
	Schedule 2.1

	 	Advance Conditions
	Schedule 2.3.5

	 	Make Whole Breakage Amount Definitions
	Schedule 3.9.3

	 	Northeast Portfolio Projects
	Schedule 5.3.4

	 	Lead Based Paint Projects
	Schedule 5.3.5

	 	O&M Plan Projects
	Schedule 5.3.6

	 	UST Projects
	Schedule 5.3.7

	 	Phase II Projects
	Schedule 4

	 	Projects
	Schedule 9.14

	 	Required Repairs
	Schedule 9.17

	 	Post Closing Obligations

(vi)

 

INDEX OF DEFINED TERMS

	 	 	 	 	 
	Abatement Budget
	 	 	41	 
	Abatement Plan
	 	 	41	 
	Abatement Program
	 	 	41	 
	ACM
	 	 	42	 
	Additional Advance
	 	 	1	 
	Additional Costs
	 	 	24	 
	Adjusted Operating Expenses
	 	 	1	 
	Adjusted Operating Revenues
	 	 	1	 
	Administrative Agent
	 	 	1	 
	Advance Date
	 	 	1, 22	 
	Affiliate
	 	 	1	 
	Agreement
	 	 	1	 
	Allocated Loan Amount
	 	 	1	 
	Alternate Base Rate
	 	 	1	 
	Alternate Base Rate Loans
	 	 	2	 
	Anti-Money Laundering Laws
	 	 	2	 
	Applicable Lending Office
	 	 	2	 
	Applicable Percentage
	 	 	2	 
	Appraisal
	 	 	2	 
	Asbestos Operations & Maintenance Plans
	 	 	42	 
	Assignment and Acceptance
	 	 	2	 
	Assignment of Contracts
	 	 	2	 
	Assignments of Rents and Leases
	 	 	3	 
	Bank Secrecy Act
	 	 	3	 
	Bankruptcy Party
	 	 	57	 
	Basle Accord
	 	 	3	 
	Borrower
	 	 	1	 
	Borrower Party
	 	 	3	 
	Building
	 	 	3	 
	Buildings
	 	 	3	 
	Business Day
	 	 	3	 
	Capital Improvements Period
	 	 	19	 
	Capital Improvements Reserve
	 	 	3	 
	Capital Improvements Shortfall
	 	 	20	 
	Carve-Out Guaranty
	 	 	3	 
	Cash Flow Sweep Event
	 	 	3	 
	Cash Flow Sweep Release
	 	 	3	 
	Cash on Cash Return
	 	 	3	 
	Casualty
	 	 	37	 
	Closing Date
	 	 	4	 
	Commitment
	 	 	4	 
	Contract Rate
	 	 	4	 
	Contribution Agreement
	 	 	4	 
	Control
	 	 	4	 
	Convert
	 	 	4	 
	Cross-Collateral Guaranty
	 	 	4	 
	Debt
	 	 	4	 
	Debt Service
	 	 	5	 
	Debt Service Coverage
	 	 	5	 
	Default Rate
	 	 	5	 
	Early Termination Date
	 	 	29	 
	Environmental Consultant
	 	 	41	 
	Environmental Laws
	 	 	39	 
	Eurodollar Business Day
	 	 	6	 
	Event of Default
	 	 	56	 
	Expense Fee
	 	 	34	 
	Federal Funds Rate
	 	 	5	 
	Financial Institution
	 	 	5	 
	First Mortgage
	 	 	5	 
	Form W-8BEN
	 	 	28	 
	Form W-8ECI
	 	 	28	 
	Guarantors
	 	 	5	 
	Guaranty
	 	 	5	 
	Hazardous Materials
	 	 	39	 
	Hazardous Materials Indemnity Agreement
	 	 	5	 
	Interest Rate Protection Agreement
	 	 	6	 
	Interest Rate Protection Pledge
	 	 	6	 
	Joinder Loan Documents
	 	 	6	 
	Lead Based Paint Operations and Maintenance Plan

	 	 	41	 
	Leases
	 	 	6	 
	Lender
	 	 	1	 
	Lenders
	 	 	1	 
	Libor-based Loans
	 	 	6	 
	Libor-based Rate
	 	 	6, 25	 
	Lien
	 	 	6	 
	Loan Documents
	 	 	6	 
	Loan Year
	 	 	7	 
	Loans
	 	 	6	 
	Lockout Period
	 	 	18	 
	LTV
	 	 	7	 
	Majority Lenders
	 	 	7	 
	Management Agreements
	 	 	7	 
	Manager Subordination Agreement
	 	 	7	 
	Managers
	 	 	7	 
	Maturity Date
	 	 	7	 
	Maximum Loan Amount
	 	 	7	 
	Mortgage
	 	 	7	 
	Mortgage Security Documents
	 	 	8	 
	Net Cash Flow
	 	 	8	 
	Net Cash Flow Sweep
	 	 	29	 
	Net Operating Income
	 	 	8	 
	Note
	 	 	8	 
	Note A
	 	 	8	 
	Note A and Note B Lockout Period
	 	 	8, 18	 
	Note A Interest Rate
	 	 	8	 
	Note A Loans
	 	 	8	 
	Note B
	 	 	8	 
	Note B Interest Rate
	 	 	8	 
	Note B Loans
	 	 	9	 
	Note C
	 	 	9	 
	Note C Amortization Date
	 	 	18	 
	Note C Interest Rate
	 	 	9	 
	Note C Loans
	 	 	9	 
	Note C Lockout Period
	 	 	8	 
	OFAC
	 	 	9	 
	Operating Expenses
	 	 	9	 
	Operating Revenues
	 	 	10	 
	Other Income
	 	 	10	 
	Partial Release
	 	 	10	 
	Partial Release Amount
	 	 	10	 
	Partial Release Notice
	 	 	10	 

(vii)

 

	 	 	 	 	 
	Participant
	 	 	10	 
	Patriot Act
	 	 	10	 
	Payment Date
	 	 	11	 
	Payor
	 	 	11, 22	 
	Permitted Encumbrances
	 	 	11	 
	Person
	 	 	11	 
	Pledge and Security Agreement
	 	 	11	 
	Pledgor
	 	 	11	 
	Portfolio
	 	 	11	 
	Potential Default
	 	 	11	 
	Primary Debt Obligation
	 	 	11	 
	Prime Rate
	 	 	11	 
	Principal Repayment Allocations
	 	 	11	 
	Projects
	 	 	12	 
	Proposed Lender
	 	 	12, 28	 
	Recourse Guaranties
	 	 	12	 
	Regulation D
	 	 	12	 
	Regulatory Change
	 	 	12	 
	Release Date
	 	 	12	 
	Rents
	 	 	12	 
	Replacement Costs
	 	 	19	 
	Requesting Lender
	 	 	12, 28	 
	Required Amount
	 	 	19	 
	Required Payment
	 	 	22	 
	Required Payment
	 	 	12	 
	Required Repairs
	 	 	12	 
	Second Mortgage
	 	 	13	 
	Secondary Debt Obligation
	 	 	13	 
	Secured Guaranty
	 	 	13	 
	Single Purpose Entity
	 	 	13	 
	Site Assessment
	 	 	13	 
	Specially Designated National and Blocked Persons

	 	 	13	 
	State
	 	 	13	 
	Substitute Loan
	 	 	13	 
	Substitute Project
	 	 	33	 
	Substitution Fee
	 	 	34	 
	Substitution Request
	 	 	33	 
	Survey Completion Date
	 	 	41	 
	Tax and Insurance Escrow Fund
	 	 	39	 
	Taxes
	 	 	13	 
	Term
	 	 	14	 
	Title Policy
	 	 	14	 
	Type
	 	 	14	 
	U.S. Person
	 	 	14, 28	 
	U.S. Taxes
	 	 	28	 
	Underwritten Expenses
	 	 	14	 
	Underwritten Income
	 	 	14	 

(viii)

 

LOAN AGREEMENT

This Loan Agreement (together with all exhibits, schedules, and attachments and as hereafter
amended, this “Agreement”) is entered into as of November 30, 2005 among each of the
entities that is a signatory hereto identified under the caption “BORROWERS” on the signature pages
hereof (individually, a “Borrower” and, collectively, the “Borrowers”); each of the
lenders that is a signatory hereto identified under the caption “LENDERS” on the signature pages
hereof and each lender that becomes a “Administrative Agent” after the date hereof pursuant to
Section 12.27.2 (individually, a “Lender” and, collectively, the
“Lenders”); and GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation, as
administrative agent for the Lenders (in such capacity, together with its successors in such
capacity, “Administrative Agent”).

1. CERTAIN DEFINITIONS

As used herein, defined terms shall have the meanings ascribed to them in the text of this
Agreement (refer to the index of defined terms in the Table of Contents) and in addition, the
following terms have the meanings indicated:

“Additional Advance” has the meaning assigned in Section 2.1.1.(d).

“Adjusted Operating Expenses” means Underwritten Expenses, as determined and adjusted by
Administrative Agent in accordance with its then current audit policies and procedures.

“Adjusted Operating Revenues” means Underwritten Revenues, as determined and adjusted by
Administrative Agent in accordance with its then current audit policies and procedures.

“Advance Date” has the meaning assigned in Section 2.7.3.

“Affiliate” means (a) any corporation in which any Borrower or any partner, shareholder,
director, officer, member, or manager of any Borrower directly or indirectly owns or controls more
than ten percent (10%) of the beneficial interest, (b) any partnership, joint venture or limited
liability company in which any Borrower or any partner, shareholder, director, officer, member, or
manager of any Borrower is a partner, joint venturer or member, (c) any trust in which any Borrower
or any partner, shareholder, director, officer, member or manager of any Borrower is a trustee or
beneficiary, (d) any entity of any type that is directly or indirectly owned or controlled by any
Borrower or any partner, shareholder, director, officer, member or manager of any Borrower, (e) any
partner, shareholder, director, officer, member, manager or employee of any Borrower, (f) any
Person related by birth, adoption or marriage to any partner, shareholder, director, officer,
member, manager, or employee of any Borrower, or (g) any Borrower Party.

“Allocated Loan Amount” means, for any Project, the portion of the principal amount of the
Loans allocated to such Project in Exhibit D annexed hereto, as such amount may be
increased as provided in Section 2.1.1.

“Alternate Base Rate” means, for any day, a rate per annum equal to the Prime Rate in
effect for such day plus one and eight-tenths percent (1.8%) per annum.

1

 

“Alternate Base Rate Loans” means the Note C Loans that bear interest at rates based upon
the Alternate Base Rate.

“Anti-Money Laundering Laws” means those laws, regulations and sanctions, state and
federal, criminal and civil, that (a) limit the use of and/or seek the forfeiture of proceeds from
illegal transactions; (b) limit commercial transactions with designated countries or individuals
believed to be terrorists, narcotics dealers or otherwise engaged in activities contrary to the
interests of the United States; (c) require identification and documentation of the parties with
whom a Financial Institution conducts business; or (d) are designed to disrupt the flow of funds to
terrorist organizations. Such laws, regulations and sanctions shall be deemed to include the
Patriot Act, the Bank Secrecy Act, the Trading with the Enemy Act, 50 U.S.C. App. Section 1 et
seq., the International Emergency Economic Powers Act, 50 U.S.C. Section 1701 et seq., and the
sanction regulations promulgated pursuant thereto by the OFAC, as well as laws relating to
prevention and detection of money laundering in 18 U.S.C. Sections 1956 and 1957.

“Applicable Lending Office” means, for each Lender and for each Type of Loan, if
applicable, the “Lending Office” of such Lender (or of an affiliate of such Lender) designated on
the respective signature pages hereof or such other office of such Lender (or of an affiliate of
such Lender) as such Lender may from time to time specify to Administrative Agent and Borrowers as
the office by which its Loans and the Loans of each Type are to be made and maintained.

“Applicable Percentage” means, with respect to any Lender, the percentage of the total
Commitments represented by such Lender’s Commitment. If the Commitments have terminated or
expired, the Applicable Percentages shall be determined based upon the Commitments most recently in
effect, giving effect to any assignments.

“Appraisal” means an appraisal of a Project prepared by a MAI appraiser in accordance with
the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation, in compliance
with the requirements of Title 11 of the Financial Institution Reform, Recovery and Enforcement Act
of 1989 and the regulations promulgated thereunder and utilizing customary valuation methods such
as the income, sales/market or cost approaches, as any of the same may be updated by
recertification from time to time by the appraiser performing such Appraisal.

“Assignment and Acceptance” means an Assignment and Acceptance, duly executed by the
parties thereto, in substantially the form of Exhibit E hereto and consented to by
Administrative Agent in accordance with Section 12.27.2.

“Assignment of Contracts” means each absolute, first priority Assignments of Contracts,
Licenses, Permits, Agreements, Warranties and Approvals, dated as of the date hereof, by Borrowers
for the benefit of Administrative Agent (on behalf of the Lenders), together with all amendments,
modifications or supplements thereto, pertaining to an absolute, first priority assignment to
Administrative Agent (on behalf of the Lenders) of all of
Borrowers’ rights, title and benefits under all agreements, license agreements, permits (including,
license building and occupancy permits), approvals, operating contracts, trade names, signage
agreements and all service, supply and maintenance contracts relating to the Projects, unless
prohibited by law or the express terms of such instruments.

2

 

“Assignments of Rents and Leases” means, collectively, the Assignment of Rents and Leases
and any other assignments of rents and leases executed by any Borrower for the benefit of
Administrative Agent (on behalf of the Lenders), and pertaining to leases of space in the Projects,
together with all amendments, modifications and supplements thereto.

“Bank
Secrecy Act” means the Bank Secrecy Act, 31 U.S.C.
Sections 5311 et seq.

“Basle Accord” means the proposals for risk-based capital framework described by the Basle
Committee on Banking Regulations and Supervisory Practices in its paper entitled “International
Convergence of Capital Measurement and Capital Standards” dated July 1988, as amended, modified and
supplemented and in effect from time to time or any replacement thereof.

“Borrower Party” means any Guarantor, any general partner or managing member in any
Borrower, and any general partner or managing member in any partnership or limited liability
company that is a general partner in or managing member in any Borrower at any level.

“Building” or “Buildings”, as the context requires means each building and the
other improvements and appurtenances attendant thereto now or hereafter erected, and all related
facilities, amenities, fixtures, equipment and personal property owned by any Borrower with respect
thereto located on the real property described on Exhibit A attached hereto and made a part
hereof, comprising the Projects.

“Business Day” means a day other than a Saturday, a Sunday, or a legal holiday on which
national banks located in the State of New York are not open for general banking business.

“Capital Improvements Reserve” has the meaning attached to such term in Section 2.5
hereof.

“Carve-Out Guaranty” shall mean that certain Guaranty of the Non-Recourse Exceptions, dated
as of the date hereof, from Tarragon to Administrative Agent (on behalf of the Lenders) with
respect to the exceptions to the non-recourse provisions contained in Section 13.1 hereof,
as the same may be modified or amended from time to time.

“Cash on Cash Return” means, as of the date of any calculation, the ratio, expressed as a
percentage, of (a) annualized Net Operating Income, to (b) the outstanding principal balance of the
Loans.

“Cash Flow Sweep Event” means, at any time (a) during the first Loan Year (i) Cash on Cash
Return is less than seven percent (7.0%) or (ii) Debt Service
Coverage is less than 1.05:1, (b) during the second Loan Year (i) Cash on Cash Return is less than
seven and one half percent (7.50%) or (ii) Debt Service Coverage is less than 1.10:1, (c) during
the third Loan Year (i) Cash on Cash Return is less than eight percent (8.0%) or (ii) Debt Service
Coverage is less than 1.20:1, (d) during the fourth Loan Year (i) Cash on Cash Return is less than
eight and one quarter percent (8.25%) or (ii) Debt Service Coverage is less than 1.25:1, or (e)
during the fifth Loan Year (i) Cash on Cash Return is less than eight and one half percent (8.50%)
and (ii) Debt Service Coverage is less than 1.30:1.

“Cash Sweep Release” shall mean, at any time after the occurrence of a Cash Flow Sweep
Event, that the Cash on Cash Return and Debt Service Coverage shall be at or above the levels

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identified for the applicable Loan Year in the definition of Cash Flow Sweep Event for a period of
at least six (6) consecutive months.

“Closing Date” means the date of the initial funding of the proceeds of the Loans.

“Commitment” means, as to each Lender, the obligation of such Lender to make Loans in the
aggregate principal amount up to but not exceeding the amount set opposite the name of such Lender
on Schedule 1 under the caption “Commitment” or, in the case of a Person that becomes a
Lender pursuant to an assignment permitted under Section 12.27.2, as specified in the
respective instrument of assignment pursuant to which such assignment is effected. The original
aggregate principal amount of the Commitments is $391,000,000.00.

“Contract Rate” means, (a) with respect to the Note A Loans, the Note A Interest Rate, (b)
with respect to the Note B Loans, the Note B Interest Rate, and (c) with respect to the Note C
Loans, the Note C Interest Rate.

“Contribution Agreement” means the Contribution Agreement, dated as of the date hereof,
among the Guarantors, as the same may have been heretofore modified or may be further modified or
amended from time to time.

“Control” means having (either directly or indirectly) primary responsibility to make or
veto all material decisions and day-to-day management decisions with respect to the operation,
management and disposition of another Person’s assets (including decisions regarding sales,
acquisitions and financings). “Control” shall not be deemed diminished solely by the fact that
responsibility for day-to-day operating and management functions or leasing activities as are
ordinarily handled by a property manager has been delegated by such controlling Person pursuant to
an agreement in writing to another Person.

“Convert” “Conversion” and “Converted” refer to a conversion pursuant to
the terms of this Agreement of one Type of Loans into another Type of Loans, which may be
accompanied by the transfer by a Lender (at its sole discretion) of a Loan from one Applicable
Lending Office to another.

“Cross-Collateral Guaranty” means, collectively, that certain Cross-Collateral Guaranties,
dated as of the date hereof, from Tarragon to Administrative Agent (on behalf of the Lenders) with
respect to certain cross-collateral aspects of the Loans, as the same may or may be modified or
amended from time to time.

“Debt” means, for any Person, without duplication: (a) all indebtedness of such Person for
borrowed money, for amounts drawn under a letter of credit, or for the deferred purchase price of
property for which such Person or its assets is liable, (b) all unfunded amounts under a loan
agreement, letter of credit, or other credit facility for which such Person would be liable, if
such amounts were advanced under the credit facility, (c) all amounts required to be paid by such
Person as a guaranteed payment to partners and/or members or a preferred or special dividend,
including any mandatory redemption of shares or interests, (d) all indebtedness guaranteed by such
Person, directly or indirectly, (e) all obligations under leases that constitute capital leases for
which such Person is liable, and (f) all obligations of such Person under interest rate swaps,
caps, floors, collars and other interest hedge agreements, in each case whether such Person is

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liable contingently or otherwise, as obligor, guarantor or otherwise, or in respect of which
obligations such Person otherwise assures a creditor against loss.

“Debt Service” means the aggregate interest, principal (if any), and other payments
required to be made under the Loans, and on any other outstanding permitted Debt relating to the
Projects approved by Administrative Agent for the period of time for which calculated, but
excluding any Net Cash Flow paid to Administrative Agent under Section 3.2 hereof.

“Debt Service Coverage” means, for the period of time for which calculation is being made,
the ratio of Net Operating Income to Debt Service.

“Default Rate” means the lesser of (a) the maximum rate of interest allowed by applicable
law, and (b) five percent (5%) per annum in excess of the Contract Rate.

“Federal Funds Rate” means, for any day, the rate per annum (rounded upwards, if necessary,
to the nearest 1/100 of 1%) equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such
day, provided that (a) if the day for which such rate is to be determined is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day and (b) if such rate is not so
published for any Business Day, the Federal Funds Rate for such Business Day shall be the average
rate charged to Deutsche Bank Trust Company Americas on such Business Day on such transactions as
determined by Administrative Agent, or such other commercial bank as selected by Administrative
Agent.

“Financial Institution” means a United States Financial Institution as defined in 31 U.S.C.
5312, as periodically amended.

“First Mortgage” means a first Lien priority mortgage, subject to Permitted Encumbrances,
deed of trust, deed to secure debt or other real property Lien instrument acceptable to
Administrative Agent (as the same may be modified, amended, consolidated, restated, refinanced, or
extended) that: (a) is executed and delivered from time to time in favor Administrative Agent (on
behalf of the Lenders) in connection with this Agreement or the Loans; (b) encumbers the Project(s)
owned by the Borrower executing such First Mortgage; and (c) secures the Primary Debt Obligation of
such Borrower and such other sums as are specified in such Notes and in such First Mortgage as
being secured thereby.

“Guarantors” means the Persons, if any, executing a Guaranty, including Borrowers and
Tarragon.

“Guaranties” collectively means the instruments of guaranty or indemnification, as further
described and defined on Schedule 2 attached hereto and made a part hereof, and
individually, any one of such Guaranties, as the context shall dictate, as such instruments may be
amended or modified from time to time.

“Hazardous Materials Indemnity Agreement” means each Environmental Indemnity Agreement
dated as of the date hereof, from Borrowers and Tarragon in favor of Administrative Agent (on

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behalf of the Lenders) with respect to environmental matters related to the Projects, together with
all amendments, modifications and supplements thereto.

“Interest Rate Protection Agreement” has the meaning assigned in Section 9.16.

“Interest Rate Protection Pledge” shall mean a Collateral Assignment of Interest Rate
Protection Agreement substantially in the form attached hereto as Exhibit I, to be
executed, dated and delivered by Borrowers and the counterparty under the applicable Interest Rate
Protection Agreement in favor of Administrative Agent (on behalf of the Lenders) at any time
Borrowers are required to enter into an Interest Rate Protection Agreement, which Collateral
Assignment of Interest Rate Protection Agreement shall provide for, among other things, the
assignment to Administrative Agent (on behalf of the Lenders) of all of Borrowers’ right, title and
interest in and to any such Interest Rate Protection Agreement, as the same may be modified,
supplemented or amended.

“Joinder Loan Documents” has the meaning attached to such term in Section 3.10
hereof.

“Leases” means all written rights to use or occupy any portion of the Projects.

“Libor-based Loans” means Loans evidenced by Note C that bear interest at rates based on
rates referred to in the definition of “Libor-based Rate.”

“Libor-based Rate” means the U.S. Dollar rate (rounded upward to the nearest one-one
hundredth of one percent) listed on page 3750 (i.e., the Libor page) of the Telerate News
Services titled “British Banker Association Interest Settlement Rates” for a designated
maturity of one (1) month determined as of 11:00 a.m. London Time on the second (2nd) full
Eurodollar Business Day next preceding the first day of each month with respect to which interest
is payable under the Loans attributable to Note C (unless such date is not a Business Day in which
event the next succeeding Business Day will be used). If the Telerate News Services (i) publishes
more than one (1) such Libor-based Rate, the average of such rates shall apply, or (ii) ceases to
publish the Libor-based Rate, then the Libor-based Rate shall be determined from such substitute
financial reporting service as Lender in its discretion, shall determine. “Eurodollar Business
Day” means any day on which banks in the City of London are generally open for interbank or
foreign exchange transactions.

“Lien” means any interest, or claim thereof, in any Project securing an obligation owed to,
or a claim by, any Person other than the owner of such Project, whether such interest is based on
common law, statute or contract, including the lien or security interest arising from a deed of
trust, mortgage, assignment, encumbrance, pledge, security agreement, conditional sale or trust
receipt or a lease, consignment or bailment for security purposes. The term “Lien” shall include
reservations, exceptions, encroachments, easements, rights of way, covenants, conditions,
restrictions, leases and other title exceptions and encumbrances affecting any Project.

“Loans” means, collectively, the Note A and Note B Loans and the Note C Loans made by the
Lenders to Borrowers under this Agreement and all other amounts secured by the Loan Documents.

“Loan Documents” means: (a) this Agreement, (b) the Notes, (c) the Guaranties, (d) the
Pledges, (e) any letter of credit provided to Administrative Agent in connection with the Loans,
(f) the

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Mortgages, (g) the Assignments of Rents and Leases, (h) the Assignments of Contracts, (i)
the Manager Subordination Agreements, (j) Uniform Commercial Code financing statements, (k) such
assignments of management agreements, contracts and other rights as requested by Administrative
Agent, (l) the Hazardous Materials Indemnity Agreement, (m) the Interest Rate Protection Pledge,
(n) all other documents evidencing, securing, governing or otherwise pertaining to the Loans, and
(o) all amendments, modifications, renewals, substitutions and replacements of any of the
foregoing.

“Loan Year” means (a) for the first Loan Year, the period between the date hereof and
November 30, 2006, and (b) each consecutive twelve month calendar period after the first Loan Year
until the Maturity Date.

“LTV” means, as of any date of determination, the ratio, expressed as a percentage, of (a)
the outstanding principal balance of the Loans as of such date to (b) the value of the Projects as
of such date, as determined in Administrative Agent’s sole and absolute discretion.

“Majority Lenders” means Lenders holding at least sixty-six and two-thirds percent
(662/3%) of the aggregate outstanding principal amount of the Loans or, if the Loans
shall not have been made, at least sixty-six and two-thirds percent (662/3%) of the
Commitments.

“Make Whole Breakage Amount” means the amount resulting from the calculation set forth in
Schedule 2.3.5 attached hereto.

“Management Agreements” means those certain management agreements described in Exhibit
F attached hereto between Managers and Borrowers with respect to the management of the Projects
by the Managers, together with any management agreements entered into with future Managers in
accordance with the terms of this Agreement.

“Managers” means the Persons identified as property managers in Exhibit F attached
hereto, which are initially the managers of the Projects under the Management Agreements, together
with any successor property managers appointed for any of the Projects in accordance with the terms
of this Agreement.

“Manager Subordination Agreement” means each of the Manager’s Consent and Subordination of
Management Agreements, dated as of the date hereof, among Borrowers, Managers and Administrative
Agent (on behalf of the Lenders), together with all amendments, modifications and supplements
thereto.

“Maturity Date” means the earlier of (a) November 30, 2012, or (b) any earlier date on
which the Loans are required to be paid in full, by acceleration or otherwise, under this Agreement
or any of the other Loan Documents.

“Maximum Loan Amount” means the amount of Three Hundred Ninety-One Million Dollars and
No/100s ($391,000,000).

“Mortgage” means each First Mortgage and Second Mortgage and any other deed of trust, deed
to secure debt or similar agreement executed by any Borrower in favor of Administrative Agent (on
behalf of the Lenders) covering any Project and any amendments, modifications, renewals,
substitutions, consolidations, severances and replacements thereof.

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“Mortgage Security Documents” means, collectively, the Mortgages, the UCC financing
statements, the Subordinations of Management Agreement and any other document or instrument
securing the obligations secured or intended to be secured by the Mortgage, together with any
rider, addendum or amendment thereto, as the same may be amended, restated, replaced, supplemented
or otherwise modified from time to time.

“Net Cash Flow” means, for any period, the amount by which Operating Revenues exceed the
sum of (a) Operating Expenses, (b) Debt Service, and (c) any actual payment into impounds, escrows,
or reserves required by Administrative Agent, except to the extent included within the definition
of Operating Expenses.

“Net Operating Income” means the amount by which Adjusted Operating Revenues exceed
Adjusted Operating Expenses.

“Notes” means collectively, each Note A, each Note B and each Note C of even date herewith
as provided for in Section 2.1.4 and all promissory notes delivered in substitution or
exchange therefor, in each case as the same may be consolidated, replaced, severed, modified,
amended or extended from time to time.

“Note A” shall mean, collectively, those certain notes or note denominated “Note A” dated
concurrently with this Agreement, executed by each Borrower to the order of the Lender named
therein, in the aggregate original principal amount of $305,000,000, as the same may be
consolidated, replaced, severed, modified, amended or extended from time to time. Each Note A
shall constitute a “Note” for all purposes under this Agreement and the other Loan Documents.

“Note A and Note B Lockout Period has the meaning assigned in Section 2.3.5.

“Note C Lockout Period has the meaning assigned in Section 2.3.5.

“Note A Interest Rate” means (a) with respect to Loans evidenced by Note A and advanced as
of the Closing Date, a rate of interest equal to five and seven hundred seventy-eight thousandths
percent (5.778%) per annum (or, when applicable pursuant to this Agreement or any other Loan
Document, the Default Rate); and (b) with respect to any Additional Advance, a rate of interest per
annum equal to the Treasury Rate plus one and thirty-three hundredths percent (1.33%) (or, when
applicable pursuant to this Agreement or any other Loan Document, the Default Rate).

“Note A Loans” means the Loans made to Borrowers evidenced by Note A and bearing interest
at the Note A Interest Rate.

“Note B” shall mean, collectively, those certain notes or note denominated “Note B” dated
concurrently with this Agreement, executed by each Borrower to the order of the Lender named
therein, in the aggregate original principal amount of $66,000,000, as the same may be
consolidated, replaced, severed, modified, amended or extended from time to time. Each Note B
shall constitute a “Note” for all purposes under this Agreement and the other Loan Documents.

“Note B Interest Rate” means (a) with respect to Loans evidenced by Note B and advanced as
of the Closing Date, a rate of interest equal to six and seven hundred thirty-four thousandths
percent (6.734%) per annum (or, when applicable pursuant to this Agreement or any other Loan
Document, the Default Rate); and (b) with respect to any Additional Advance, a rate of interest

8

 

per
annum equal to the Treasury Rate plus two and two hundred and eighty-six thousandths percent
(2.286%) (or, when applicable pursuant to this Agreement or any other Loan Document, the Default
Rate).

“Note B Loans” means the Loans made to Borrowers evidenced by Note B and bearing interest
at the Note B Interest Rate.

“Note C” shall mean, collectively, those certain notes or note denominated “Note C” dated
concurrently with this Agreement, executed by each Borrower to the order of the Lender named
therein, in the aggregate original principal amount of $20,000,000, as the same may be
consolidated, replaced, severed, modified, amended or extended from time to time. Each Note C
shall constitute a “Note” for all purposes under this Agreement and the other Loan Documents.

“Note C Interest Rate” means, with respect to Loans evidenced by Note C, a rate of interest
per annum equal to four and one half percent (4.50%) in excess of the Libor Rate, provided however,
that, subject to the provisions of Section 2.7 at such time that the Loans evidenced by
Note C are Alternate Base Rate Loans, the interest rate for such Alternate Base Rate Loans shall be
equal to the Alternate Base Rate (or, in each case, when applicable pursuant to this Agreement or
any other Loan Document, the Default Rate).

“Note C Loans” means the Loans made to Borrowers evidenced by Note C and bearing interest
at the Note C Interest Rate.

“OFAC” means the Office of Foreign Assets Control, Department of the Treasury.

“Operating Expenses” means the following: all reasonable and necessary expenses of
operating the Projects in the ordinary course of business that are paid in cash by Borrowers and
that are directly associated with and fairly allocable to the Projects for the applicable period,
including ad valorem real estate taxes and assessments, insurance premiums, regularly scheduled tax
impounds paid to Administrative Agent, maintenance costs, management fees and costs not to exceed
three percent (3%) of Operating Revenues, accounting, legal, and other professional fees, fees
relating to environmental and Net Cash Flow and Net Operating Income audits, and other expenses
incurred by Administrative Agent and reimbursed by Borrower under this Agreement and the other Loan
Documents, deposits to any capital replacement reserves required by Administrative Agent, wages,
salaries, and personnel expenses, but excluding Debt Service, capital expenditures, any of the
foregoing expenses that are paid from deposits to cash reserves previously included as Operating
Expenses, any payment or expense for which any Borrower was or is to be reimbursed from proceeds of
the Loans or insurance or by any third party, and any non-cash charges such as depreciation and
amortization. Any management fee or other expense payable to any Borrower or to an Affiliate of
any Borrower shall be included as an Operating Expense only with Administrative Agent’s prior
approval. Administrative Agent hereby approves the management fee payable to Manager, provided
that each such fee is and remains equal to or less than three percent (3%) of Operating Revenues
relating to the applicable Project, and approves the inclusion of such fee in Borrowers’
calculation of Operating Expenses. Operating Expenses shall not include federal, state or local
income taxes or legal and other professional fees unrelated to the operation of the Projects.

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“Operating Revenues” means the following: all cash receipts of Borrowers from operation of
the Projects or otherwise arising in respect of the Projects after the date hereof that are
properly allocable to the Projects for the applicable period, including receipts from Leases and
parking agreements, concession fees and charges and other miscellaneous operating revenues,
proceeds from rental or business interruption insurance, proceeds of any loans (other than the
Loans and any refinancing of the Loans) obtained by any Borrower after the date hereof that are
secured by the Projects (less only reasonable and customary expenses incurred in procuring and
closing such loan and actually paid in cash to individuals or entities other than a Borrower or any
Affiliate of any Borrower and without implying any consent of Administrative Agent to the granting
of any security for any such loans), withdrawals from cash reserves (except to the extent any
operating expenses paid therewith are excluded from Operating Expenses), but excluding security
deposits and earnest money deposits until they are forfeited by the depositor, advance rentals
until they are earned, and proceeds from a sale or other disposition, casualty or condemnation.

“Other Income” means, for any period of determination, the then current audited income
received from sources other than Rent, as determined by Administrative Agent’s then current audit
policy, including, without limitation, storage rentals or payments, parking income, pet fees,
application fees, laundry fees, vending fees, provided that such income has been collected
consistently for at least each of the most recent three (3) years (or, in Administrative Agent’s
discretion, such shorter time which is sufficient in Administrative Agent’s discretion to
demonstrate the consistency of such income). Notwithstanding the foregoing, “Other Income”
shall not include, at Administrative Agent’s discretion, (a) interest income or (b) fifty percent
(50%) of negative event income (i.e., late fees, termination payments and forfeited security
deposits).

“Partial Release ”has the meaning assigned in Section 3.9.

“Partial Release Amount” means, except as otherwise set forth in Section 3.9.3(b),
with respect to any Project, an amount of immediately available funds sufficient to pay the
aggregate of the following:

	 	(A)	 	one hundred fifteen percent (115%) of the Allocated Loan Amount
for the Project proposed to be released (or, in the case of a Partial Release
involving more than one (1) Project, the aggregate of the Allocated Loan
Amounts for the Projects proposed to be released) (which amount shall be equal
to (i) one hundred percent (100%) of the Allocated Loan Amount of such
Project(s) (the “Par Amount”) plus (ii) fifteen percent (15%) of the
Allocated Loan Amount of such Project(s) (the “Acceleration Payment”);
and
	 
	 	(B)	 	all amounts due under Section 2.3.4 in connection with
the payment described in clause (A) above.

“Partial Release Notice” has the meaning assigned in Section 2.9.

“Participant” has the meaning assigned in Section 12.27.3.

“Patriot Act” means the USA Patriot Act of 2001, Pub. L. No. 107-56.

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“Payment Date” means January 1, 2006, and the first day of each month thereafter during the
Term.

“Payor” has the meaning assigned in Section 2.6.3.

“Permitted Encumbrances” has the meaning set forth in the Mortgages.

“Person” means any individual, corporation, partnership, joint venture, association, joint
stock company, trust, trustee, estate, limited liability company, unincorporated organization, real
estate investment trust, government or any agency or political subdivision thereof, or any other
form of entity.

“Pledges” means collectively the Pledge and Security Agreements, each dated as of the date
hereof, for the benefit of Administrative Agent (on behalf of the Lenders) from the Pledgors
pursuant to which each of the pledgors thereunder pledge to Administrative Agent (on behalf of the
Lenders) all of its then respective direct or indirect interest in one or more Borrowers,
including, without limitation, the rights to receive all distributions made by, and profits earned
by, one or more Borrowers as all of the foregoing may have been or may hereafter be further amended
or modified from time to time.

“Pledgor” means each of Ansonia MezzCo, a Delaware limited liability company, Vintage
National, Inc., a Texas corporation, Stewart Square National, Inc., a Nevada corporation, Woodcreek
Garden Apartments, a California limited partnership, and Tarragon Woodcreek, Inc., a Nevada
corporation, in their capacities as pledgors under the Pledges.

“Portfolio” means the portfolio of Projects listed under the column “Project” on
Schedule 4, and all Projects securing all Substitute Loans made as permitted hereunder, if
any.

“Potential Default” means the occurrence of any event or condition that, with the giving of
notice, the passage of time, or both, would constitute an Event of Default.

“Primary Debt Obligation” means, with respect to any Borrower, the amount equal to the
maximum principal amount of the Notes executed by such Borrower.

“Prime Rate” means the highest prime rate (or base rate) reported in the Money Rates column
or section of The Wall Street Journal as the rate in effect for corporate loans at large United
States money center commercial banks (whether or not such rate has actually been charged by any
such bank) from time to time. If The Wall Street Journal ceases publication of the Prime Rate, the
“Prime Rate” shall mean the prime rate (or base rate) announced by Deutsche Bank Trust
Company Americas (whether or not such rate has actually been charged by such bank). If such bank
discontinues the practice of announcing the Prime Rate, the “Prime Rate” shall mean the
prime or base rate charged by a large United States commercial bank selected by the Administrative
Agent to its most creditworthy large corporate borrowers.

“Principal Repayment Allocations” means, in connection with any repayment on account of the
principal amount of the Loans, so long as no Event of Default exists, an allocation of such
repayment among the Notes as follows:

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          (a) Subject to the provisions of Section 3.9.3, if such repayment arises from a
Partial Release, casualty, condemnation, failure of title or other event affecting a specific
Project (“Project Proceeds”), then such repayment shall be applied first against the Notes
executed by the Borrower whose Project was affected thereby and thereafter to reduce the amount of
the various Notes in proportion to their then relative principal balances; and

          (b) If such repayment arises from mandatory amortization or any source other than Project
Proceeds, then such repayment shall be applied to reduce the principal balances of the applicable
Notes (as determined in accordance with Section 3.9.3) in proportion to their then relative
principal balances.

“Projects” means the apartment Projects listed on Schedule 4 attached hereto and
made a part hereof and shall also be deemed to include the projects which secure, to the extent
outstanding, all Substitute Loans made as permitted hereunder, if any.

“Proposed Lender” has the meaning assigned in Section 2.8.7.

“REA” means each agreement executed by a Borrower or a predecessor in interest with regard
to a Project pursuant to which such Borrower, as the owner of such Project, and other owners
and/or operators of real property adjacent to such Project set forth the terms and conditions
regarding reciprocal easements, the management and operation of a planned development in which such
Project is located, and other similar matters, together with other similar agreements.

“Recourse Guaranties” means collectively the Cross-Collateral Guaranty and the Carve-Out
Guaranty.

“Regulation D” means Regulation D of the Board of Governors of the Federal Reserve System
of the United States of America (or any successor), as the same may be modified and supplemented
and in effect from time to time.

“Regulatory Change” means any change after the date hereof in federal, state or foreign law
or regulations (including, without limitation, Regulation D) or the adoption or making after such
date of any interpretation, directive or request applying to a class of banks including
Administrative Agent of or under any federal, state or foreign law or regulations (whether or not
having the force of law and whether or not failure to comply therewith would be unlawful) by any
court or governmental or monetary authority charged with the interpretation or administration
thereof.

“Release Date” has the meaning assigned in Section 3.9.1.

“Rents” means, collectively, rents and all other sums due Borrowers under the Leases.

“Requesting Lender has the meaning assigned in Section 2.8.7.

“Required Payment” has the meaning assigned in Section 2.7.3.

“Required Repairs” means the immediate maintenance, repairs, and/or remedial or corrective
work as more particularly described on Schedule 9.14, attached hereto and made a part
hereof.

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“Second Mortgage” means a mortgage, deed of trust, deed to secure debt or other real
property lien instrument acceptable to Administrative Agent (as the same may be modified, amended,
consolidated, restated, refinanced, or extended) that: (a) is executed and delivered from time to
time in favor of Administrative Agent (on behalf of the Lenders) in connection with this Agreement
or the Loans; (b) encumbers the Project(s) owned by the Borrower executing such Second Mortgage;
(c) secures the Secured Guaranty executed by such Borrower; ] and (d) is subordinate in Lien,
subject to Permitted Encumbrances, priority only to the First Mortgage encumbering such Project(s).

“Secondary Debt Obligation” means, with respect to any Borrower, the Primary Debt
Obligations of all of the other Borrowers, other than the Primary Debt Obligation of such Borrower.

“Secured Guaranty” means each Guaranty identified as a Secured Guaranty on Schedule
2 attached hereto.

“Single Purpose Entity” means a Person (other than an individual, a government, or any
agency or political subdivision thereof), which exists solely for the purpose of owning one or more
Projects, conducts business only in its own name, does not engage in any business or have any
assets unrelated to one or more Projects, or interests in another Project owning entity, does not
have any indebtedness other than as permitted by this Agreement, has its
own separate books, records, and accounts (with no commingling of assets), holds itself out as
being a Person separate and apart from any other Person, and observes corporate and partnership
formalities independent of any other entity, and which otherwise constitutes a single purpose,
bankruptcy remote entity as determined by Administrative Agent.

“Site Assessment” means an environmental engineering report for a Project prepared by an
engineer engaged by Administrative Agent at Borrowers’ expense, and in a manner satisfactory to
Administrative Agent, based upon an investigation relating to and making appropriate inquiries
concerning the existence of Hazardous Materials on or about the Project in question, and the past
or present discharge, disposal, release or escape of any such substances, all consistent with good
customary and commercial practice.

“Specially Designated National and Blocked Persons” means those Persons that have been
designated by executive order or by the sanction regulations of OFAC as Persons with whom U.S.
Persons may not transact business or must limit their interactions to types approved by OFAC.

“State” means, with respect to any Project, the State or Commonwealth in which such Project
is located.

“Substitute Loan” means a new loan or a modification of the Loans pursuant to Section
3.10 hereof.

“Tarragon” means Tarragon Corporation, a Nevada corporation.

“Taxes” has the meaning attached to such term in Section 9.2 hereof.

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“Term” means the period beginning on the date hereof and ending upon the Maturity Date of
the Loans or upon any accelerated maturity of the Loans in accordance with the provisions of the
Loan Documents.

“Title Policy” means, an ALTA mortgagee’s title insurance policy for a Project, as more
particularly described in Part A of Schedule 2.1 attached hereto and made a part hereof.

“Treasury Rate” shall mean (a) as used in the calculation of Make Whole Breakage Amount,
(i) with respect to the Loans advanced as of the Closing Date, four and four hundred forty-eigth
thousands percent (4.448%), and (ii) with respect to each Additional Advance, the Treasury Rate
applicable thereto pursuant to clause (b) of this definition; and (b) as used in clause (b) of the
definitions of Note A Interest Rate and Note B Interest Rate, a rate determined by Administrative
Agent as of the date of such calculation equivalent to the yield, calculated by linear
interpolation (rounded to two decimal places), on U.S. Treasury Security as quoted in the Wall
Street Journal having maturities as close as possible to the remaining term of the Loans. If the
Wall Street Journal (i) quotes more than one such seven year U.S. Treasury Security, the highest of
such quotes shall apply, or (ii) ceases to publish such quotes, the seven year U.S. Treasury
Security shall be determined from such substitute financial reporting service or source as Lender
in its discretion shall determine.

“Type” has the meaning assigned in Section 2.1.

“U.S. Person” means any United States citizen, any entity organized under the laws of the
United States or its constituent states or territories, or any entity, regardless of where
organized, having its principal place of business within the United States or any of its
territories.

“Underwritten Expenses” means the calculation of the last twelve (12) months rolling
expenses adjusted for non-recurring items, the management fee (which fee is subject to the
limitations set forth in this Agreement), replacement reserves as determined by Administrative
Agent’s engineer, and current or stabilized real estate taxes and insurance premiums.
Administrative Agent may in its discretion, make adjustments to the foregoing method of calculation
from time to time.

“Underwritten Income” means, for any period of determination, the sum of (a) the then
current (as reflected by the rent rolls, certified by Borrowers) audited gross potential income
(which income shall be the sum that is equal to the number of leased and Rent-producing units at
the Projects plus the number of non-income producing units (i.e. without limitation, units that are
vacant, used for employees, under Rent concessions, or are display units) multiplied by twelve (12)
multiplied by the average of the last twelve (12) months average economic occupancy percentage
(such percentage to be a function of rental unit income received divided by gross potential income)
with further adjustments to be made for units rented above prevailing market rent as well as for
current Rent concessions being offered at the Projects, plus (b) Other Income. Notwithstanding the
foregoing, average economic occupancy will not exceed the lesser of ninety-five percent (95%),
average market occupancy rates, or actual average economic occupancy. Administrative Agent may in
its discretion, make adjustments to the foregoing method of calculation from time to time.

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2. THE LOAN

2.1 General. Each Lender severally agrees, on the terms and conditions of this Agreement,
to make loans to Borrowers in Dollars in an aggregate principal amount up to but not exceeding the
amount of the Commitment of such Lender. The Loans shall be funded in one or more advances and
repaid in accordance with this Agreement. Loans applicable to Note C hereunder are distinguished
by “Type.” The “Type” of a Loan refers to whether such Loan is an Alternate Base
Rate Loan or a Libor-based Loan, each of which constitutes a Type.

     2.1.1 Advances.

          (a) Initial Advance of the Note A Loans and Note B Loans. The initial advance of the
Note A Loans and Note B Loans, in the aggregate amount of up to $371,000,000.00, shall be made
ratably by the Lenders to the Borrowers in accordance with the respective Allocated Loan Amounts of
the Project(s) owned by each Borrower upon Borrowers’ satisfaction of the conditions to initial
advance described in Schedule 2.1.

          (b) Initial Advance of Note C Loans. The initial advance of the Note C Loans, in the
aggregate amount of up to $20,000,000.00, shall be made ratably by the Lenders to the Borrowers in
accordance with the respective Allocated Loan Amounts of the Project(s)
owned by each Borrower upon Borrowers’ satisfaction of the conditions to initial advance
described in Schedule 2.1.

          (c) Reserved.

          (d) Additional Advances of Note A and Note B. In any of the first (1st),
second (2nd), third (3rd) or fourth (4th) Loan Years, Borrowers
shall be permitted to request (and, subject to the terms and conditions of this Section 2.1
and Borrowers’ satisfaction of the terms and conditions set forth in Part B of Schedule 2.1
hereto, each of the Lenders severally agrees to advance its Applicable Percentage of) up to two (2)
additional advances of the Loans per Loan Year (each such additional advance, an “Additional
Advance”) in an aggregate principal amount, taking into account all additional advances under
the Note A and Note B in such Loan Year and in all prior Loan Years, not to exceed Twenty Million
Dollars ($20,000,000.00). Any such Additional Advance shall be made ratably to the Borrowers in
accordance with the respective Allocated Loan Amounts of the Project(s) owned by each Borrower and
shall be used (i) first, at all times while there is any balance on Note C, solely by Borrowers to
pay down the principal balance of Note C and (ii) second, provided that Note C has been paid in
full, to Borrowers, and in each case, shall be made in accordance with a written request of the
Borrowers containing the Borrowers’ wire transfer instructions and the other information required
by Schedule 2.1 (an “Additional Advance Request”). Without limiting the generality
of the foregoing, each Lender’s obligation to fund its Applicable Percentage of any Additional
Advance is subject to Administrative Agent’s verification, based upon audits of Net Operating
Income for periods ending not more than sixty (60) days prior to the date of the proposed
Additional Advance, of the then Net Operating Income, Debt Service Coverage and Cash on Cash
Return. Upon verifying that Borrowers have satisfied or failed to satisfy the Additional Advance
conditions set forth in Part B of Schedule 2.1, Administrative Agent shall so
notify the Borrowers and the Lenders and, if the Additional Advance conditions have been satisfied,
the Lenders shall each make their respective Applicable Percentages of the requested Additional
Advance available to the Borrowers on the date specified by Administrative Agent in such notice to
the Borrowers and the

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Lenders, which date shall be the first Payment Date immediately following the
date on which such notice is given. For the avoidance of doubt: (a) no Additional Advance may be
used for any other purpose than to repay the principal balance on Note C unless and until Note C
has been repaid in full, and nothing in this Section 2.1.1(d) shall be construed as to permit the
making of an Additional Advance for purposes of repaying all or any portion of Note C prior to the
end of the Note C Lockout Period; (b) in determining the amount of any Additional Advance
hereunder, after Borrowers have satisfied all of the Additional Advance conditions set forth herein
and in Part B of Schedule 2.1, each Additional Advance by the Lenders hereunder shall be reduced by
an amount equal to the reduction in the outstanding principal amount of the Loans attributed to the
cumulative Acceleration Payment(s) on account of each Partial Release made pursuant to Section
3.9.1; and (c) in no event shall the outstanding principal balance of the Loans hereunder at any
time exceed the Maximum Loan Amount. Amounts borrowed hereunder and repaid may not be reborrowed.

     2.1.2 Lending Offices. The Loans of each Lender shall be made and maintained at such
Lender’s Applicable Lending Office for Loans of such Type.

     2.1.3 Several Obligations. The failure of any Lender to make any Loan to be made by it on the date specified therefor shall
not relieve any other Lender of its obligation to make its Loan, but neither any Lender nor
Administrative Agent shall be responsible for the failure of any other Lender to make a Loan to be
made by such other Lender.

     2.1.4 Notes.

          (a) Loan Notes. The Loans made by each Lender shall be evidenced by its Note(s)
substantially in the form of Exhibit C, payable to such Lender in a principal amount equal
to the product of (x) such Lender’s Applicable Percentage and (y) the aggregate Allocated Loan
Amount for the Projects owned by such Borrower, and otherwise duly completed.

          (b) Endorsements on Notes. The date, amount, Type and interest rate of each Loan made
by each Lender to each Borrower, and each payment made on account of the principal thereof, shall
be recorded by such Lender on its books and, prior to any transfer of the Note(s) held by it,
endorsed by such Lender on the schedule attached to such Note(s) or any continuation thereof;
provided that the failure of such Lender to make any such recordation or endorsement shall not
affect the obligations of such Borrower to make a payment when due of any amount owing hereunder or
under such Note in respect of such Loans.

          (c) Substitution, Exchange and Subdivision of Notes. Each Lender shall be entitled to
have its Note(s) substituted or exchanged or subdivided for promissory notes of lesser
denominations, from time to time in connection with a permitted assignment of all or any portion of
such Lender’s Commitment, Loans and Notes pursuant to Sections 12.10, 12.12 or
12.27 (and, if requested by any Lender, each Borrower agrees to so substitute or exchange
any Notes and enter into note splitter agreements in connection therewith).

          (d) Loss, Theft, Destruction or Mutilation of Notes. In the event of the loss, theft
or destruction of any Note, upon the applicable Borrower’s receipt of a reasonably satisfactory
indemnification agreement executed in favor of such Borrower by the holder of such Note, or in the
event of the mutilation of any Note, upon the surrender of such mutilated Note by

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the holder
thereof to the applicable Borrower, such Borrower shall execute and deliver to such holder a new
replacement Note in lieu of the lost, stolen, destroyed or mutilated Note.

2.2 Interest Rate; Late Charge.

     2.2.1 Interest Rate. The outstanding principal balance of the Loans (including any
amounts added to principal under the Loan Documents) shall bear interest at the Contract Rate.
Interest owing for each month shall be computed on the basis of a fraction, the denominator of
which is three hundred sixty (360) and the numerator of which is the actual number of days elapsed
from the first day of such month (or, for the initial advance, from the date of such advance).
Principal and other amortization payments shall be applied to the balance of the Loans as and when
actually received.

     2.2.2 Late Charge. If Borrowers fail to pay any installment of interest or principal
within five (5) days after the date on which the same is due, Borrowers shall pay to Administrative
Agent (on behalf of the Lenders) a late charge on such past-due amount, as
liquidated damages and not as a penalty, equal to the five percent (5%) of such amount, but
not in excess of the maximum amount of interest allowed by applicable law. The foregoing late
charge is intended to compensate Administrative Agent and the Lenders for the expenses incident to
handling any such delinquent payment and for the losses incurred by Administrative Agent and the
Lenders as a result of such delinquent payment. Borrowers agree that, considering all of the
circumstances existing on the date this Agreement is executed, the late charge represents a
reasonable estimate of the costs and losses Administrative Agent and the Lenders will incur by
reason of late payment. Borrowers and Administrative Agent and the Lenders further agree that
proof of actual losses would be costly, inconvenient, impracticable and extremely difficult to fix.
Acceptance of the late charge shall not constitute a waiver of the default arising from the
overdue installment, and shall not prevent Administrative Agent and the Lenders from exercising any
other rights or remedies available to Administrative Agent and the Lenders. While any Event of
Default exists, the Loans shall bear interest at the Default Rate.

2.3 Terms of Payment. The Loan shall be payable as follows:

     2.3.1 Interest. Commencing on the first Payment Date, Borrowers shall pay interest
with respect to each Note in arrears on the first Business Day of each month until all amounts due
under the Loan Documents are paid in full.

     2.3.2 Note A and Note B Principal Amortization. With respect to the Note A Loans and
Note B Loans, collectively, commencing on the first Payment Date of the sixth (6th) Loan Year (the
“Note A and Note B Principal Amortization Date”) and continuing on each Payment Date until
the Maturity Date, in addition to the payment of interest as provided in Section 2.3.1
hereof and any other sums required to be paid to the Lenders by Borrowers hereunder, Borrowers
shall pay to the Lenders, pro rata among the Note A Loans and Note B Loans, monthly principal
payments in sufficient amounts so as to amortize the aggregate outstanding principal balance of the
Note A Loans and the Note B Loans over a twenty-five (25) year period commencing on the Note A and
Note B Principal Amortization Date, as determined by Administrative Agent based on the aggregate
amount of the Note A Interest Rate and the Note B Interest Rate then in effect; and

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     2.3.3 Note C Principal Amortization. On the first Payment Date (the “Note C
Amortization Date”), and on each subsequent Payment Date until the earlier to occur of: (i) the
Maturity Date or (ii) the date the principal amount of the Note C Loans has been paid in full, in
addition to the payment of interest as provided in Section 2.3.1 hereof and any other sums
required to be paid to the Lenders by Borrowers hereunder, Borrowers shall pay to the Lenders
monthly principal payments in sufficient amounts so as to amortize the outstanding principal
balance from time to time of the Note C Loans over a twenty-five (25) year period commencing on the
Note C Amortization Date, as calculated by Administrative Agent monthly based on the Note C
Interest Rate then in effect. In the event any Additional Advance(s) are made pursuant to
Section 2.1.1(a) hereunder to prepay the Note C Loans after the Note C Amortization Date,
Administrative Agent shall in its own discretion, at the time of such Additional Advance, adjust
the required monthly amortization payments required under this Section 2.3.3 to take
account of such Additional Advance and reduction of the balance of the Note C Loans.
Administrative Agent’s determination of the amount of the monthly amortization
payments to be made by Borrowers under this Section 2.3.3 shall be reasonably
calculated and conclusive absent demonstrable error.

     2.3.4 Maturity. On the Maturity Date, Borrowers shall pay to Administrative Agent (on
behalf of the Lenders) all outstanding principal, accrued and unpaid interest, and any other
amounts due under the Loan Documents.

     2.3.5 Prepayment of Loan.

          (a) Note A Loans and Note B Loans. The Note A Loans and Note B Loans are closed to
prepayment, in whole or in part, during the first two (2) Loan Years (the “Note A and Note B
Lockout Period”). Thereafter, upon not less than thirty (30) days’ prior written notice to
Administrative Agent, Borrowers may prepay any of the Loans, in whole but not in part, upon payment
of a prepayment premium equal to the Make Whole Breakage Amount, calculated as provided in
Schedule 2.3.5, except that no premium shall be due if the Note A Loans and Note B Loans
are repaid during the forty-five (45) day period prior to the scheduled Maturity Date. If the Note
A Loans and Note B Loans are accelerated during the Lockout Period for any reason other than
casualty or condemnation, Borrowers shall pay, in addition to all other amounts outstanding under
the Loan Documents, a prepayment premium (the “Prepayment Premium”) equal to five percent
(5%) of the outstanding balance of the Loans plus the Make Whole Breakage Amount. Without limiting
the foregoing, Borrowers shall have the right to defease all or a portion of the Loans in
accordance with Exhibit J attached hereto after the Note A and Note B Lockout Period and
the Note C Lockout Period.

          (b) Note C Loans. The Note C Loans are closed to prepayment, in whole or in part,
during the first eighteen months of the Term (the “Note C Lockout Period”). Thereafter,
upon not less than thirty (30) days’ prior written notice to Administrative Agent, Borrowers may
prepay the Note C Loans, in whole or in part.

     2.3.6 No Make Whole Breakage. Notwithstanding anything to the contrary in Section
2.3, No Make Whole Breakage Amount shall be applicable to prepayments of the Loans pursuant to
Sections 2.3.2., 2.3.3, 2.3.5 or 3.1.

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     2.3.7 Loans Continue if Prepayment Not Made. If after providing Administrative Agent
with notice of its intention to prepay any of the Loans on a date certain, Borrowers fail to prepay
any of the Loans on such date, (1) such notice of prepayment shall be deemed rescinded, and (2) the
Loans shall continue without Potential Default or Event of Default by reason of such failure
provided that Borrowers pay to Administrative Agent and the Lenders the out-of-pocket fees and
expenses and, with respect to Note C only, breakage costs incurred by Administrative Agent and the
Lenders as a result of such failure by Borrowers, if any.

     2.3.8 Application of Payments. All payments received by Administrative Agent under
the Loan Documents shall be applied: first, to any fees and expenses due to Administrative Agent
and the Lenders under the Loan Documents; second, to any Default Rate interest or late charges;
third, to accrued and unpaid interest; fourth, to amounts owed under any reserves or escrows
required by Administrative Agent; and fifth, to the principal sum and other amounts due or
outstanding under the Loan Documents, as Administrative Agent shall determine.

2.4 Security. The Loans shall be secured by, among other things, the Mortgages, the
Assignments of Rents and Leases, the Pledges, the Guaranties and the other Loan Documents. As
further security for the Loans, Borrowers agree to fund the:

     2.4.1
Tax and Insurance Escrow Fund in accordance with Section 4.4 hereof;

     2.4.2
Capital Improvements Reserve in accordance with Section 2.5 below; and

     2.4.3
Required Repairs Reserve in accordance with Section 2.6 below.

2.5 Capital Improvements Reserve.

     2.5.1 During each Loan Year, Borrowers shall be obligated to spend with respect to the
Projects, an amount (the “Required Amount”) equal to (a) for the period commencing on the
Closing Date and ending on December 31, 2006 (the “Initial Capital Improvements Period”),
the sum of $301.00 per rental unit at the Projects out of Operating Revenues; and (b) thereafter,
for each twelve (12) month period during the Term commencing on January 1 and ending on December 31
of the each calendar year (each such twelve-month period, together with the Initial Capital
Improvements Period, a “Capital Improvements Period”), $278.00 per rental unit at the
Projects out of Operating Revenues. The Required Amount for each Capital Improvements Period shall
be used to pay the costs of replacing furnishings, fixtures and equipment at the Projects and
making such capital repairs and replacements to the Projects as are necessary to continue the
present use thereof as a top quality apartment complex in good repair (excluding, however, the
customary costs of ongoing maintenance at the Projects) (collectively, “Replacement
Costs”). Expenditures for Replacement Costs shall be made subject to and in accordance with an
annual budget prepared by Borrowers and reviewed and approved by Administrative Agent in accordance
with this Agreement, or shall otherwise be made only with the prior written approval of
Administrative Agent in its sole discretion. Borrowers shall submit to Administrative Agent no
later than the fifteenth (15th) day of the last calendar month of each Capital
Improvements Period a list of Replacement Costs expended during such Capital Improvements Period,
together with reasonable supporting documentation therefor.

19

 

     2.5.2 If any Borrower expends less than the Required Amount for Replacement Costs in any
Capital Improvements Period (a “Capital Improvements Shortfall”), then in such event such
Borrower shall be obligated to deposit such Capital Improvements Shortfall into an account held by
Administrative Agent (the “Capital Improvements Reserve”) no later than the fifteenth
(15th) day of the next Capital Improvements Period. To the extent any Borrower, in any
Capital Improvements Period, pays the Required Amount for Replacement Costs and thereafter incurs
additional Replacement Costs, it may use funds in the Capital Improvements Reserve, if any, to pay
for such additional Replacement Costs. The Capital Improvements Reserve shall be an interest
bearing account held by Administrative Agent (on behalf of the Lenders) and may be commingled with
Administrative Agent’s own funds. Borrowers hereby grant to Administrative Agent (on behalf of the
Lenders) a security interest in the Capital Improvements Reserve. While an Event of Default or a
Potential Default exists, Administrative Agent shall not be obligated to permit advances to
Borrowers of the Capital Improvements Reserve, and while an Event of Default exists,
Administrative Agent shall be entitled, without notice to Borrowers, to apply any funds in the
Capital Improvements Reserve to satisfy Borrowers’ obligations under the Loan Documents. The
Capital Improvements Reserve shall be advanced to Borrowers to reimburse Borrowers for Replacement
Costs incurred by Borrowers during the applicable Capital Improvements Period in accordance with
the budget reviewed and approved by Administrative Agent as described in the preceding clause (a)
or in accordance with the provisions of Schedule 2.1 Part D, attached hereto and made a
part hereof, or as otherwise approved by Administrative Agent, but only after Borrowers have
expended the Required Amount for such Capital Improvements Period from their own funds. The
Capital Improvements Reserve shall be advanced in accordance with the provisions of Schedule
2.1 Parts C and D, attached hereto, and shall not in any event be disbursed for the financing
of any of the Required Repairs.

2.6 Required Reserves.

     2.6.1 Completion of Required Repairs. Borrowers shall perform and complete each item of the
repairs and environmental remedial work at the Projects described on Schedule 9.l4 hereto
(the “Required Repairs”) within twelve (12) months of the date hereof or such shorter
period of time for such item set forth on Schedule 9.14 hereto.

     2.6.2 Escrow. On the date hereof, Borrowers shall deposit with Administrative Agent
the aggregate amount set forth on Schedule 9.14 hereto as being required to complete the
Required Repairs and Administrative Agent shall cause such amount to be transferred to an interest
bearing account (the “Required Repairs Reserve”). Provided no Potential Default or Event
of Default shall have occurred and is continuing, Administrative Agent shall disburse funds held in
the Required Repairs Reserve to the applicable Borrower, within fifteen (15) days after the
delivery by a Borrower to Administrative Agent of a request therefor (but not more often than once
per month), in increments of at least $10,000, accompanied by the following items (which items
shall be in form and substance satisfactory to Administrative Agent): (i) a certificate from such
Borrower (A) certifying that the Required Repairs or any portion thereof which are the subject of
the requested disbursement have been completed in a good and workmanlike manner and in accordance
with all applicable legal requirements, (B) identifying each Person that supplied materials or
labor in connection with such Required Repairs or any portion thereof and (C) stating that each
such Person has been or, upon receipt of the requested disbursement, will be paid in full with
respect to the portion of the Required Repairs which is the subject of the requested disbursement;
(ii) copies of appropriate lien waivers or other evidence of

20

 

payment satisfactory to Administrative
Agent; (iii) at Administrative Agent’s option, a title search for the relevant Project indicating
that it is free from all liens not previously approved by Administrative Agent; (iv) a copy of each
license required to be obtained with respect to the portion of the Required Repairs which is the
subject of the requested disbursement; and (v) such other evidence as Administrative Agent shall
reasonably request that the Required Repairs which are the subject of the requested disbursement
have been completed and paid for. Provided no Potential Default or Event of Default shall have
occurred and is continuing, upon each Borrower’s completion of all Required Repairs in accordance
with this Section 2.6.2, Administrative Agent shall release any funds remaining in the
Required Repairs Reserve, if any, to the applicable Borrower.

     2.6.3 Interest Payable by Administrative Agent. All monies held in reserves which are
expressly designated elsewhere in this Agreement as interest-bearing (each, an
“Interest-Bearing Reserve”) shall be deposited into interest-bearing accounts of the type
customarily maintained by Administrative Agent for the investment of (and may be commingled with)
similar reserves or Administrative Agent’s general funds, which accounts may not yield the highest
interest rate then available. Each Interest Bearing Reserve shall be held in an account in
Administrative Agent’s name (or such other account name as Administrative Agent may elect) at a
financial institution or other depository selected by Administrative Agent in its sole discretion
(collectively, the “Depository Institution”). Each Borrower shall earn no more than an
amount of interest on each Interest Bearing Reserve equal to an amount determined by applying to
the average monthly balance of such Interest Bearing Reserve the quoted interest rate for the
Depository Institution’s money market savings account, as such rate is determined from time to time
(each such allocated amount being referred to as “Borrower’s Interest”). Administrative
Agent or its Depository Institution shall be entitled to report under each Borrower’s Federal tax
identification number of such Borrower’s Interest on each Interest Bearing Reserve. If the
Depository Institution does not have an established money market savings account (or if an interest
rate for such account cannot otherwise be determined in connection with the deposit of each
Interest Bearing Reserve), a comparable interest rate quoted by the Depository Institution and
acceptable to Administrative Agent in its reasonable discretion shall be used. The amount of each
Borrower’s Interest allocated to each Interest Bearing Reserve shall be added to the balance in
such Interest Bearing Reserve, and shall be disbursed for payment of the items for which such
Interest Bearing Reserve is to be disbursed. Any interest earned above each Borrower’s Interest
shall be retained by Administrative Agent (on behalf of the Lenders) as compensation for its
administration and investment of each Interest Bearing Reserve.

2.7 Payments; Pro Rata Treatment; Etc.

     2.7.1 Payments Generally..

          (a) Payments by Borrowers. Except to the extent otherwise provided herein, all
payments of principal, interest and other amounts to be made by Borrowers under this Agreement and
the Notes, and, except to the extent otherwise provided therein, all payments to be made by
Borrowers under any other Loan Document, shall be made in Dollars, in immediately available funds,
without deduction, set-off or counterclaim, to Administrative Agent at an account designated by
Administrative Agent by notice to Borrowers, not later than 2:00 p.m., New York City time, on the
date on which such payment shall become due (each such

21

 

payment made after such time on such due
date to be deemed to have been made on the next succeeding Business Day).

          (b) Application of Payments. At the time of making each payment under this Agreement
or any Note for the account of any Lender, Administrative Agent may distribute such payment to the
Lenders for application in such manner as it may determine to be appropriate, subject to
Section 2.7.2 and any other agreement among Administrative Agent and the Lenders with
respect to such application.

          (c) Forwarding of Payments by Administrative Agent. Except as otherwise agreed by
Administrative Agent and the Lenders, each payment received by Administrative Agent under this
Agreement or any Note for account of any Lender shall be paid by Administrative Agent promptly to
such Lender, in immediately available funds, for account of such Lender’s Applicable Lending Office
for the Loans or other obligation in respect of which such payment is made.

          (d) Extensions to Next Business Day. If the due date of any payment under this
Agreement or any Note would otherwise fall on a day that is not a Business Day, such date shall be
extended to the next succeeding Business Day, and interest shall be payable for any principal so
extended for the period of such extension.

     2.7.2 Pro Rata Treatment. Except to the extent otherwise provided herein: (a) each
advance of a Loan from the Lenders under Section 2.1 shall be made from the Lenders, and
any termination of the obligation to make an advance of the Loans shall be applied to the
respective Commitments of the Lenders, pro rata according to the amounts of their respective
Commitments; (b) except as otherwise provided in Section 2.7.4, Loans shall be allocated
pro rata among the Lenders according to the amounts of their respective Commitments (in the case of
the making of Loans) or their respective Loans (in the case of Conversions of Loans); (c) each
payment or prepayment of principal of Loans by Borrowers shall be made in accordance with the
Principal Repayment Allocations and for account of the Lenders pro rata in accordance with the
respective unpaid principal amounts of the Commitments held by them; and (d) each payment of
interest on the Loans by Borrowers shall be made for account of the Lenders pro rata in accordance
with the amounts of interest on the Loans then due and payable to the respective Lenders.

     2.7.3 Non-Receipt of Funds by Administrative Agent. Unless Administrative Agent shall have
been notified by a Lender or a Borrower (in either case, the “Payor”) prior to the date on
which the Payor is to make payment to Administrative Agent of (in the case of a Lender) the
proceeds of the Loans to be made by such Lender hereunder or (in the case of a Borrower) a payment
to Administrative Agent for account of any Lender hereunder (in either case, such payment being
herein called the “Required Payment”), which notice shall be effective upon receipt, that
the Payor does not intend to make the Required Payment to Administrative Agent, Administrative
Agent may assume that the Required Payment has been made and may, in reliance upon such assumption
(but shall not be required to), make the amount thereof available to the intended recipient(s) on
such date; and, if the Payor has not in fact made the Required Payment to Administrative Agent, the
recipient(s) of such payment shall, on demand, repay to Administrative Agent the amount so made
available together with interest thereon in respect of each day during the period commencing on the
date (the “Advance Date”) such amount was so

22

 

made available by Administrative Agent until
the date Administrative Agent recovers such amount at a rate per annum equal to (i) the Federal
Funds Rate for such day in the case of payments returned to Administrative Agent by any of the
Lenders or (ii) the applicable interest rate due hereunder with respect to payments returned by a
Borrower to Administrative Agent and, if such recipient(s) shall fail promptly to make such
payment, Administrative Agent shall be entitled to recover such amount, on demand, from the Payor,
together with interest as aforesaid, provided that if neither the recipient(s) nor the Payor shall
return the Required Payment to Administrative Agent within three (3) Business Days of the Advance
Date (unless Borrowers are the Payor, in which case such period shall be five (5) days), then,
retroactively to the Advance Date, the Payor and the recipient(s) shall each be obligated to pay
interest on the Required Payment as follows:

          (a) if the Required Payment shall represent a payment to be made by Borrowers to the Lenders,
Borrowers and the recipient(s) shall each be obligated retroactively to the Advance Date to pay
interest in respect of the Required Payment at the Default Rate (without duplication of the
obligation of Borrowers under Section 2.2 to pay interest on the Required Payment at the
Default Rate), it being understood that the return by the recipient(s) of the Required Payment to
Administrative Agent shall not limit such obligation of Borrowers under Section 2.2 to pay
interest at the Default Rate in respect of the Required Payment, and

          (b) if the Required Payment shall represent proceeds of the Loans to be made by the Lenders to
Borrowers, the Payor and Borrowers shall each be obligated retroactively to the Advance Date to pay
interest in respect of the Required Payment pursuant to the rate specified in Section 2.2,
it being understood that the return by Borrowers of the Required Payment to Administrative Agent
shall not limit any claim Borrowers may have against the Payor in respect of such Required Payment.

     2.7.4 Sharing of Payments, Etc.

          (a) Right of Set-off. Borrowers agree that, in addition to (and without limitation
of) any right of set-off, banker’s lien or counterclaim a Lender may otherwise have, each Lender
shall be entitled, at its option (to the fullest extent permitted by law), to set off and apply any
deposit (general or special, time or demand, provisional or final), or other indebtedness, held by
it for the credit or account of any Borrower at any of its offices, in Dollars or in any other
currency, against any principal of or interest on any of such Lender’s Loans or any other amount
payable to such Lender hereunder, that is not paid when due (regardless of whether such deposit or
other indebtedness is then due to such Borrower), in which case it shall promptly notify Borrowers
and Administrative Agent thereof, provided that such Lender’s failure to give such notice shall not
affect the validity thereof.

          (b) Sharing. If any Lender shall obtain from Borrowers payment of any principal of or
interest on the Loans owing to it or payment of any other amount under this Agreement or any other
Loan Document through the exercise of any right of set-off, banker’s lien or counterclaim or
similar right or otherwise (other than from Administrative Agent as provided herein), and, as a
result of such payment, such Lender shall have received a greater percentage of the principal of or
interest on the Loans or such other amounts then due hereunder or thereunder by Borrowers to such
Lender than the percentage received by any other Lender, it shall promptly purchase from such other
Lenders participations in (or, if and to the extent

23

 

specified by such Lender, direct interests in)
the Loans or such other amounts, respectively, owing to such other Lenders (or in interest due
thereon, as the case may be) in such amounts, and make such other adjustments from time to time as
shall be equitable, to the end that all the Lenders shall share the benefit of such excess payment
(net of any expenses that may be incurred
by such Lender in obtaining or preserving such excess payment) pro rata in accordance with the
unpaid principal of and/or interest on the Loans or such other amounts, respectively, owing to each
of the Lenders. To such end all the Lenders shall make appropriate adjustments among themselves
(by the resale of participations sold or otherwise) if such payment is rescinded or must otherwise
be restored.

          (c) Consent by Borrower. Borrowers agree that any Lender so purchasing such a
participation (or direct interest) may exercise all rights of set-off, banker’s lien, counterclaim
or similar rights with respect to such participation as fully as if such Lender were a direct
holder of the Loans or other amounts (as the case may be) owing to such Lender in the amount of
such participation.

          (d) Rights of Lenders; Bankruptcy. Nothing contained herein shall require any Lender
to exercise any such right or shall affect the right of any Lender to exercise, and retain the
benefits of exercising, any such right with respect to any other indebtedness or obligation of any
Borrower. If, under any applicable bankruptcy, insolvency or other similar law, any Lender
receives a secured claim in lieu of a set-off to which this Section 2.7.4(d) applies, such
Lender shall, to the extent practicable, exercise its rights in respect of such secured claim in a
manner consistent with the rights of the Lenders entitled under this Section 2.7.4(d) to
share in the benefits of any recovery on such secured claim.

2.8 Yield Protection; Etc. The provisions of this Section 2.8 set forth below
shall apply only to the Note C Loans.

          2.8.1 Additional Costs.

          A. Costs of Making or Maintaining Libor-based Loans. Borrowers shall pay directly to
each Lender from time to time such amounts as such Lender may determine to be necessary to
compensate such Lender for any costs that such Lender reasonably determines are attributable to its
making or maintaining of any Libor-based Loans or its obligation to make any Libor-based Loans
hereunder, or any reduction in any amount receivable by such Lender hereunder in respect of any of
such Loans or such obligation (such increases in costs and reductions in amounts receivable being
herein called “Additional Costs”), resulting from any Regulatory Change that:

	 	(a)	 	shall subject any Lender (or its Applicable
Lending Office for any of such Loans) to any tax, duty or other charge
in respect of such Loans or its Note or changes the basis of taxation
of any amounts payable to such Lender under this Agreement or its Note
in respect of any of such Loans (excluding changes in the rate of tax
on the overall net income or franchise tax rate of such Lender or of
such Applicable Lending Office by the jurisdiction in which such Lender
has its principal office or such Applicable Lending Office); or

24

 

	 	(b)	 	imposes or modifies any reserve, special
deposit or similar requirements relating to any extensions of credit or
other assets of, or any deposits with or other liabilities of, such
Lender (including,
without limitation, any of such Loans or any deposits referred to in
the definition of “Libor-based Rate”), or any commitment of
such Lender (including, without limitation, the Commitment of such
Lender hereunder); or
	 
	 	(c)	 	imposes any other condition affecting this
Agreement or its Notes (or any of such extensions of credit or
liabilities) or its Commitment.

If any Lender requests compensation from Borrowers under this paragraph (A), Borrowers may, by
notice to such Lender (with a copy to Administrative Agent), suspend the obligation of such Lender
thereafter to make or to Convert Loans into Libor-based Loans, until the Regulatory Change giving
rise to such request ceases to be in effect (in which case the provisions of Section 2.8.4
shall be applicable), provided that such suspension shall not affect the right of such Lender to
receive the compensation so requested.

          B. Costs Attributable to Regulatory Change or Risk-Based Capital Guidelines. Without
limiting the effect of the foregoing provisions of this Section 2.8.1 (but without
duplication), Borrowers shall pay to Administrative Agent for the account of each Lender from time
to time, within ten (10) Business Days after request, such amounts as such Lender may reasonably
determine to be necessary to compensate such Lender (or, without duplication, the bank holding
company of which such Lender is a subsidiary) for any costs that it determines are attributable to
the maintenance by such Lender (or any Applicable Lending Office or such bank holding company),
pursuant to any law or regulation or any interpretation, directive or request (whether or not
having the force of law and whether or not failure to comply therewith would be unlawful) of any
court or governmental or monetary authority (i) following any Regulatory Change or (ii)
implementing any risk-based capital guideline or other requirement (whether or not having the force
of law and whether or not the failure to comply therewith would be unlawful) hereafter issued by
any government or governmental or supervisory authority implementing at the national level the
Basel Accord, of capital in respect of its Commitment or Loans (such compensation to include,
without limitation, an amount equal to any reduction of the rate of return on assets or equity of
such Lender (or any Applicable Lending Office or such bank holding company) to a level below that
which such Lender (or any Applicable Lending Office or such bank holding company) could have
achieved but for such law, regulation, interpretation, directive or request), it being agreed that
Borrowers shall make such payments within ten (10) Business Days after request therefor.

          C. Notification and Certification. Each Lender shall notify Borrowers of any event
occurring after the date hereof entitling such Lender to compensation under paragraph A or B of
this Section 2.8.1 as promptly as practicable, but in any event within thirty (30) days,
after such Lender obtains actual knowledge thereof; provided that (i) if any Lender fails to give
such notice within thirty (30) days after it obtains actual knowledge of such an event, such Lender
shall, with respect to compensation payable pursuant to this Section 2.8.1 in respect of
any costs resulting from such event, only be entitled to payment under this Section 2.8.1
for costs incurred from and after the date thirty (30) days prior to the date that such Lender does
give such

25

 

notice and (ii) each Lender will designate a different Applicable Lending Office for the
Loans of such Lender affected by such event if such designation will avoid the need for, or reduce
the amount of, such compensation and will not, in the sole opinion of such Lender, be
disadvantageous to such Lender, except that such Lender shall have no obligation to designate
an Applicable Lending Office located in the United States of America. Each Lender will furnish to
Borrowers a certificate setting forth the basis and amount of each request by such Lender for
compensation under paragraph A or B of this Section 2.8.1 within such thirty (30) day
period. Determinations and allocations by any Lender for purposes of this Section 2.8.1 of
the effect of any Regulatory Change pursuant to paragraph A of this Section 2.8.1, or of
the effect of capital maintained pursuant to paragraph B of this Section 2.8.1, on its
costs or rate of return of maintaining Loans or its obligation to make Loans, or on amounts
receivable by it in respect of Loans, and of the amounts required to compensate such Lender under
this Section 2.8.1, shall be conclusive provided that such determinations and allocations
are made on a reasonable basis and absent manifest error, and such Lender shall provide reasonable
evidence thereof.

          2.8.2 Reserved.

          2.8.3 Illegality. Notwithstanding any other provision of this Agreement, in the event
that it becomes unlawful for any Lender or its Applicable Lending Office to honor its obligation to
make or maintain Libor-based Loans hereunder (and, in the sole opinion of such Lender, the
designation of a different Applicable Lending Office would either not avoid such unlawfulness or
would be disadvantageous to such Lender), then such Lender shall promptly notify Borrowers thereof
(with a copy to Administrative Agent) and such Lender’s obligation to make or to Convert Loans of
any other Type into, Libor-based Loans shall be suspended until such time as such Lender may again
lawfully make and maintain Libor-based Loans (in which case the provisions of Section
2.8.4. shall be applicable).

          2.8.4 Treatment of Affected Loans. If the obligation of any Lender to make
Libor-based Loans or to Convert Alternate Base Rate Loans into, Libor-based Loans shall be
suspended pursuant to Section 2.8.1 or 2.8.3, such Lender’s Loans shall be
automatically Converted into Alternate Base Rate Loans on the day immediately prior to the next
succeeding Payment Date (or, in the case of a Conversion resulting from a circumstance described in
Section 2.8.3, on such earlier date as such Lender may specify to Borrowers with a copy to
Administrative Agent) and, unless and until such Lender gives notice as provided below that the
circumstances specified in Section 2.8.1 or 2.8.3 that gave rise to such Conversion
no longer exist:

          A. to the extent that such Lender’s Loans have been so Converted, all payments and prepayments
of principal that would otherwise be applied to such Lender’s Loans shall be applied instead to its
Alternate Base Rate Loans; and

          B. all Loans that would otherwise be made by such Lender as Libor-based Loans shall be made
instead as Alternate Base Rate Loans, and all Loans of such Lender that would otherwise be
Converted into Libor-based Loans shall remain as Alternate Base Rate Loans.

If such Lender gives notice to Borrowers with a copy to Administrative Agent that the circumstances
specified in Section 2.8.1 or 2.8.3 that gave rise to the Conversion of such

26

 

Lender’s Loans pursuant to this Section 2.8.4 no longer exist (which such Lender agrees to
do promptly upon such circumstances ceasing to exist) at a time when Libor-based Loans made by
other Lenders are outstanding, such Lender’s Alternate Base Rate Loans shall be automatically
Converted, on the first day(s) of the next Payment Date to the extent necessary so that, after
giving effect thereto, all Alternate Base Rate Loans and Libor-based Loans are allocated among the
Lenders ratably (as to principal amounts and Types) in accordance with their respective
Commitments.

          2.8.5 Compensation. Borrowers shall pay to Administrative Agent (for account of each
Lender, upon the request of such Lender through Administrative Agent), such amount or amounts as
shall be sufficient (in the reasonable opinion of such Lender) to compensate it for any loss, cost
or expense that such Lender reasonably determines is attributable to any payment, prepayment or
Conversion of a Libor-based Loan made by such Lender for any reason (including, without limitation,
the acceleration of the Loans pursuant to Administrative Agent’s or the Lenders’ rights referred to
in Article 11) on a date other than a Payment Date (or, if such Payment Date fall upon a
day which is not a Business Day, the next succeeding Business Day). Without limiting the effect of
the preceding sentence, such compensation shall include an amount equal to the excess, if any, of
(i) the amount of interest that otherwise would have accrued on the principal amount so paid,
prepaid or Converted from the date of such payment, prepayment or Conversion at the applicable rate
of interest for such Loan provided for herein over (ii) the amount of interest that otherwise would
have accrued on such principal amount at a rate per annum equal to the interest component of the
amount such Lender would have bid in the London interbank market for Dollar deposits of leading
banks in amounts comparable to such principal amount and with maturities comparable to such period
(as reasonably determined by such Lender), or if such Lender shall cease to make such bids, the
equivalent rate, as reasonably determined by such Lender, derived from Page 3750 of the Dow Jones
Markets (Telerate) Service or other publicly available source as described in the definition of
Libor-based Rate.

          2.8.6 U.S. Taxes.

          A. Gross-up for Deduction or Withholding of U.S. Taxes. Borrowers agree to pay to
each Lender that is not a U.S. Person such additional amounts as are necessary in order that the
net payment of any amount due to such non-U.S. Person hereunder, after deduction for or withholding
in respect of any U.S. Taxes imposed (or increased) with respect to such payment (or in lieu
thereof, payment of such U.S. Taxes by such non-U.S. Person) as a result of changes in legal
requirements or the application of new legal requirements, in either case occurring after the date
such non-U.S. Person becomes a Lender hereunder, will not be less than the amount stated herein to
be then due and payable, provided that the foregoing obligation to pay such additional amounts
shall not apply:

	 	(a)	 	to any payment to any Lender hereunder unless
such Lender is, on the date hereof (or on the date it becomes a Lender
hereunder as provided in Section 12.27.2 and on the date of any
change in the Applicable Lending Office of such Lender, either entitled
to submit a Form W-8BEN (relating to such Lender and entitling it to a
complete exemption from withholding on all interest to be received by
it hereunder in respect of the Loans) or Form W-8ECI

27

 

	 	 	 	(relating to all
interest to be received by such Lender hereunder in respect of the
Loans), or
	 
	 	(b)	 	to any U.S. Taxes imposed solely by reason of
the failure by such non-U.S. Person to comply with applicable
certification, information, documentation or other reporting
requirements concerning the nationality, residence, identity or
connections with the United States of America of such non-U.S. Person
if such compliance is required by statute or regulation of the United
States of America as a precondition to relief or exemption from such
U.S. Taxes.

For the purposes hereof, (1) “U.S. Person” means a citizen, national or resident of the
United States of America, a corporation, limited liability company, partnership or other entity
created or organized in or under any laws of the United States of America or any State thereof, or
any estate or trust that is subject to Federal income taxation regardless of the source of its
income, (2) “U.S. Taxes” means any present or future tax, assessment or other charge or
levy imposed by or on behalf of the United States of America or any taxing authority thereof or
therein, (3) “Form W-8BEN” means Form W-8BEN of the Department of the Treasury of the
United States of America and (4) “Form W-8ECI” means Form W-8ECI of the Department of the
Treasury of the United States of America. Each of the Forms referred to in the foregoing clauses
(3) and (4) shall include such successor and related forms as may from time to time be adopted by
the relevant taxing authorities of the United States of America to document a claim to which such
Form relates.

          B. Evidence of Deduction, Etc. Within thirty (30) days after paying any amount to
Administrative Agent or any Lender from which it is required by law to make any deduction or
withholding, and within thirty (30) days after it is required by law to remit such deduction or
withholding to any relevant taxing or other authority, Borrowers shall deliver to Administrative
Agent for delivery to such non-U.S. Person evidence satisfactory to such Person of such deduction,
withholding or payment (as the case may be).

          2.8.7 Replacement of Lenders. If any Lender requests compensation pursuant to
Section 2.8.1 or 2.8.6, or any Lender’s obligation to Convert Loans of any Type
into the other Type of Loan, shall be suspended pursuant to Section 2.8.2 or 2.8.3
(any such Lender requesting such compensation, or whose obligations are so suspended, being herein
called a “Requesting Lender”), Borrowers may require that such Requesting Lender transfer
all of its right, title and interest under this Agreement and such Requesting Lender’s Notes to any
bank or other financial institution (a “Proposed Lender”) identified by Borrowers that is
reasonably satisfactory to Administrative Agent (i) if such Proposed Lender agrees to assume all of
the obligations of such Requesting Lender hereunder, and to purchase all of such Requesting
Lender’s Loans hereunder for consideration equal to the aggregate outstanding principal amount of
such Requesting Lender’s Loans, together with interest thereon to the date of such purchase (to the
extent not paid by Borrowers), and satisfactory arrangements are made for payment to such
Requesting Lender of all other amounts accrued and payable hereunder to such Requesting Lender as
of the date of such transfer (including any fees accrued hereunder and any amounts that would be
payable under Section 2.8.5 as if all of such Requesting Lender’s Loans were being prepaid
in full on such date) and (ii) if such Requesting Lender has requested compensation pursuant to
Section 2.8.1 or 2.8.6, such Proposed Lender’s aggregate requested compensation, if
any, pursuant to

28

 

Section 2.8.1 or 2.8.6 with respect to such Requesting Lender’s Loans is lower
than that of the Requesting Lender. Subject to the provisions of Section 12.27.2, such
Proposed Lender shall be a “Lender” for all purposes hereunder. Without prejudice to the survival
of any other agreement of Borrowers hereunder, the agreements of Borrowers contained in
Sections 2.8.1, 2.8.6 and 12.5 (without duplication of any payments made to
such Requesting Lender by Borrowers or the Proposed Lender) shall survive for the benefit of such
Requesting Lender under this Section 2.8.7 with respect to the time prior to such
replacement.

3. SPECIAL PORTFOLIO PROVISIONS.

3.1 Net Cash Flow Sweep. During the first five (5) Loan Years of the Term, if at any time
a Cash Flow Sweep Event has occurred, then on the fifteenth day of each month following such Cash
Flow Sweep Event and continuing thereafter, Borrowers shall pay to Administrative Agent one hundred
percent (100%) of their Net Cash Flow for the immediately preceding month, such amounts to be paid
to Administrative Agent and applied by Administrative Agent in reduction of the unpaid principal
balance of the Loans, as Administrative Agent shall determine, until the occurrence of a Cash Flow
Sweep Release (the “Net Cash Flow Sweep”).

3.2 Reserved.

3.3 Reserved.

3.4 Reserved.

3.5 Reserved.

3.6 Early Loan Acceleration. Notwithstanding anything contained in this Agreement, if, at
any time (a) the outstanding principal balance of the Loans is Thirty-Five Million Dollars
($35,000,000.00) or less or (b) if less than three (3) Projects remain in the Portfolio,
Administrative Agent shall have the right to accelerate the Loans, whereupon all amounts due under
the Loan Documents shall become due and payable on the date that is ninety (90) days (the
“Early Termination Date”) after the date that Administrative Agent provides Borrowers with
written notice of its intent to accelerate the Loans pursuant to the provisions of this Section
3.6; provided that Borrowers shall have the right to repay the Loans on any date earlier than
the Early Termination Date after Borrowers’ receipt of such notice, upon not less than fifteen (15)
days prior written notice to Administrative Agent. Borrowers shall pay to Administrative Agent (on
behalf of the Lenders), in immediately available funds, all outstanding principal, accrued and
unpaid interest, and any other amounts due under the Loan Documents as of the Early
Termination Date (or as of such earlier date on which Borrowers elect to repay the Loans, as
permitted in this Section 3.6).

3.7 Reserved.

3.8 Reserved.

3.9 Release of Projects. Except as set forth in this Section 3.9, no repayment or
prepayment of all or any portion of the Notes shall cause, give rise to a right to require, or
otherwise result in, the release of the Lien of any Mortgage on any Project or other collateral
securing the Loans.

29

 

     3.9.1 Release of Individual Projects. Subject to the provisions of Section
2.3.5 and Section 2.3.7, Borrowers on one or more occasions may obtain, and
Administrative Agent and the Lenders shall take such actions as are necessary to effectuate
pursuant to this Section 3.9, the release of any one (1) or more Projects pursuant to an
arm’s length sale of a such Project(s) by any Borrower to a third-party purchaser which is not a
Borrower, a Borrower Party or an Affiliate of any Borrower or Borrower Party from the Liens of the
Mortgages thereon (and related Loan Documents) (a “Partial Release”) upon satisfaction of
each of the following conditions to the satisfaction of Administrative Agent:

          (a) Administrative Agent shall have received from Borrowers at least thirty (30) days’ prior
written notice (a “Partial Release Notice”) of the date proposed for such Partial Release
(the “Release Date”);

          (b) Borrowers shall remit to Administrative Agent on the Release Date an amount equal to the
Partial Release Amount for the applicable Project (for application to the principal balance of the
Loans as set forth in Section 3.9.3 below);

          (c) Borrowers shall pay to Administrative Agent all sums then due and payable under the Notes,
this Agreement, the Mortgages and the other Loan Documents;

          (d) the applicable Project is transferred from the Borrower owning the same to another Person
which is not a Borrower or a Borrower Party or Affiliate of Borrower or any Borrower Party;

          (e) Borrowers shall submit to Administrative Agent (on behalf of the Lenders), not less than
fifteen (15) Business Days prior to the date of such release, a release of Lien (and related Loan
Documents) for such Project for execution by Administrative Agent. Such release shall be in a form
appropriate in each jurisdiction in which the applicable Project(s) is located and reasonably
satisfactory to Administrative Agent. In addition, Borrowers shall provide all other documentation
Administrative Agent reasonably requires to be delivered by Borrowers in connection with such
release, including evidence (including such endorsements to the title policies obtained in
connection with each mortgage at the closing as Administrative
Agent may require) that such documentation (A) is in compliance with all applicable legal
requirements, (B) will effect such release in accordance with the terms of this Agreement, and (C)
will not impair or otherwise adversely affect the Liens and other rights of Administrative Agent or
Lenders under the Loan Documents not being released (or as to the parties to the Loan Documents and
Projects subject to the Loan Documents not being released);

          (f) with respect to the Note A Loans and Note B Loans:

     (i) after giving effect to such Partial Release, the Cash on Cash Return will
not be lower than the greater of (1) a 7.5% Cash On Cash Return and (2) the Cash On
Cash Return for the trailing six (6) consecutive months immediately prior to such
Partial Release;

     (ii) after giving effect to such Partial Release, the Debt Service Coverage
will not be lower than the greater of (1) 1.30:1 Debt Service Coverage and (2) the
Debt Service Coverage for the trailing six (6) consecutive months;

30

 

     (iii) after giving effect to such Partial Release, the Debt Service Coverage
will not be lower than the greater of (1) 85% LTV and (2) the LTV for the trailing
six (6) consecutive months;

          (g) with respect to the Note C Loans:

     (i) after giving effect to such Partial Release, the Cash on Cash Return will
not be lower than the greater of (1) a 7.1% Cash On Cash Return and (2) the Cash On
Cash Return for the trailing six (6) consecutive months immediately prior to such
Partial Release;

     (ii) after giving effect to such Partial Release, the Debt Service Coverage
will not be lower than the greater of (1) 1.12:1 Debt Service Coverage and (2) the
Debt Service Coverage for the trailing six (6) consecutive months;

     (iii) after giving effect to such Partial Release, the Debt Service Coverage
will not be lower than the greater of (1) 89% LTV and (2) the LTV for the trailing
six (6) consecutive months;

          (h) Administrative Agent shall have received from Borrowers with respect to the matters
referred to in clauses (f) and (g), (x) statements of the Net Operating Income and Debt Service
(both on a consolidated basis and separately for the applicable Project(s) to be released for the
applicable measuring period) and (y) based on the foregoing statements of Net Operating Income and
Debt Service, calculations of the Debt Service Coverage and Cash on Cash Return both with and
without giving effect to the proposed Partial Release, accompanied by an officer’s certificate that
such statements, calculations and information are true, correct and complete in all material
respects;

          (i) Borrowers, at their sole cost and expense, shall have delivered to Administrative Agent
one or more endorsements to the lender’s policies of title insurance delivered to Administrative
Agent on the date hereof in connection with the Mortgages insuring that, after giving effect to
such Partial Release, (x) the Liens created by the Mortgages and
insured thereby are first (or second, in the case of the Second Mortgages), priority Liens on
the remaining Projects, subject only to the Permitted Encumbrances applicable to such Projects, and
(y) that such policies are each in full force and effect and unaffected by such Partial Release;

          (j) Borrowers shall pay any amounts due in connection in with such Partial Release pursuant to
Section 2.8, and Borrowers shall pay all reasonable costs and expenses of Administrative
Agent in connection with the Partial Release;

          (k) no Event of Default or Potential Default exists and is continuing at the time of the
Partial Release Notice or on the Release Date;

          (l) after giving effect to such Partial Release, the Allocated Loan Amount for the Project
known as “River City Landing” located in Jacksonville, Florida, shall not be equal to or greater
than twenty percent (20%) of the outstanding principal balance of the Loans, or if the Allocated
Loan Amount for such Project would exceed twenty percent (20%) following such release, Borrowers
shall pay to Administrative Agent for application to the Loans secured by such Project as, when
combined with the Partial Release Amount payable in connection with

31

 

such Partial Release, is
sufficient to cause the Allocated Loan Amount for the River City Landing Project to be less than
twenty percent (20%) of the outstanding principal balance of the Loans upon such Partial Release;
and

          (m) Borrowers shall have delivered to Administrative Agent an officer’s certificate confirming
the matters referred to in clause (g) above and certifying that all conditions precedent for such
Partial Release contained in this Agreement have been satisfied.

     3.9.2 Release of All the Projects.

          (a) Subject to the provisions of Section 2.3.5, Administrative Agent shall, upon the
written request and at the expense of Borrowers, upon payment in full of all principal and interest
on the Loans and all other amounts due and payable under the Loan Documents in accordance with the
terms and provisions of the Notes and this Agreement, including, but not limited to, any prepayment
fees and Make Whole Breakage Amount due pursuant to Section 2.3.4 hereof, release the Liens
of the Mortgages and all other security interests created by the Loan Documents not theretofore
released provided that the requirements of this Section 3.9.2 have been satisfied.

          (b) In connection with the release of the Liens and any other security interests created by
the Loan Documents, Borrowers shall submit to Administrative Agent, not less than fifteen (15)
Business Days prior to the payment date, a release of Lien (and related Loan Documents) for each
Project and other collateral for execution by Administrative Agent. Such release shall be in a
form appropriate in each jurisdiction in which a Project or other collateral is located and
reasonably satisfactory to Administrative Agent. In addition, Borrowers shall provide all other
documentation Administrative Agent reasonably requires to be delivered by Borrowers in connection
with such release.

     3.9.3 Special Release Provisions.

          (a) Except as otherwise provided in Subsection 3.9.3(c) below, upon satisfaction of
the conditions to a Partial Release set forth in Section 3.9.1 above Administrative
Agent shall apply the Partial Release Price to the paydown the principal balance of the Loans,
pro rata, as follows:

     (i) The Par Amount shall be used to pay down the principal amount of the Loans
attributable to the Allocated Loan Amount for the Project(s) released; and

     (ii) The Acceleration Payment shall be used to pay down, pro rata, the
principal amount of the Loans attributable to the Allocated Loan Amounts of the
Projects listed on Schedule 3.9.3 attached hereto (the “Northeast
Portfolio”).

          (b) If, after giving effect to a Partial Release, such Partial Release would result in the
total balance of the Loans allocated to the Projects in the Northeast Portfolio being equal
to an amount greater than sixty percent (60%) of the then total outstanding balance of the Loans,
then, the Partial Release Price for such Project shall be equal to an amount which is the lesser of
(i) one hundred percent (100%) of the Net Sales Proceeds of such Project in connection with a sale
of the Project and (ii) an amount that, when applied to pay down the principal amount

32

 

of the Loans
attributable to the Allocated Loan Amounts for the Projects in the Northeast Portfolio, would
result in a loan balance for the Northeast Portfolio not greater than sixty percent (60%) of the
total outstanding balance of the Loans.

          3.9.4 Sale of Houses. Without limiting the other provisions of this Section
3.9, Borrowers shall have the right to sell one or more of the existing four (4) single and
multi-family homes located on the Project known as 200 Fountain-Executive House (each a
“House”), provided that the following conditions are satisfied: (a) such release shall be
in connection with a bona fide, arm’s length sale of a House to a third party who is not an
Affiliate of any Borrower, (b) Borrowers shall pay one hundred percent (100%) of the Net Sale
Proceeds received from the such of each House to Administrative Agent to pay down ratably the
outstanding principal balance of the Loans, (c) Borrowers shall pay the Make Whole Breakage Amount
with respect to the prepayment of the Note A Loans and the Note B Loans (with no Make Whole
Breakage Amount applied to the prepayment of the Note C Loans, but without limiting Borrower’s
obligations under Section 2.8), (d) Borrowers shall, after giving effect to the sale of
each such House, satisfy the Cash on Cash Return and Debt Service Coverage requirements set forth
in Schedule 2.1-Part B, paragraph 1, (e) such House is located on a separate legal parcel
in compliance with all applicable legal requirements, and (f) Administrative Agent shall be
satisfied in its sole discretion that the sale of such House does not in any way impair the
priority of Liens on the remaining Projects. The sale of any House shall be permitted by
Administrative Agent at any time, including during the Note A and Note B Lockout Period and the
Note C Lockout Period then existing. The Net Sales Proceeds received by Administrative Agent from
the sale of any House shall be applied pro rata to the repayment of the outstanding principal
balance of each of Note A Loans, Note B Loan and, if any are then outstanding, the Note C Loans;
provided, however, that if an Event of Default has occurred and is continuing, Administrative Agent
may apply such Net Proceeds to the obligations of the Borrowers hereunder in such order and manner
of priority as Administrative Agent may elect in its sole and absolute discretion. For purposes
hereof, “Net Sales Proceeds” means any and all consideration received by a Borrower in
connection with a bona fide, arm’s length sale of a House to a third party who is not an Affiliate
of any Borrower, less the following costs and expenses to the extent actually incurred by such
Borrower in connection with such sale: (i) reasonable and customary brokerage commissions;
(ii) the reasonable cost of title insurance purchased for the buyer; (iii) documentary
transfer taxes, sales taxes and recording fees; (iv) reasonable escrow fees; and (v) other
reasonable closing costs and expenses of the type customarily incurred by sellers of real property
in the locale where the applicable House is located.

3.10 Substitution of Projects. Borrowers may request that, at any time at least one
hundred eighty (180) days before the end of the Term, Administrative Agent substitute for a Project
another project, substantially similar in Administrative Agent’s sole determination to the Project
in question in all material respects, including, without limitation, fair market value, position in
the regional market, condition, quality, character of use, and nature (each such project, a
“Substitute Project”; and the exercise of any Borrower’s right to request such a
substitution, the “Substitution Request”). Each Substitute Project shall be owned by an
Affiliate of any Borrower, substantially similar to any Borrower in, without limitation, corporate
or company organization and ultimate ownership, purpose, and financial strength and otherwise
acceptable to Administrative Agent in its sole and absolute discretion (each such owner, a
“Substitute Borrower”). Administrative Agent agrees to allow such a substitution, subject
to the satisfaction and completion, in Administrative Agent’s sole and absolute discretion, of the
following

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conditions and requirements on or before the closing of the Substitute Loan, all of which
shall be at Borrowers’ expense.

     3.10.1 On the date that a Borrower makes the Substitution Request, Administrative Agent
receives a payment which in an amount equal to: (i) 0.25% of the amount of the Allocated Loan
Amount of the replaced Project (the “Substitution Fee”) and (ii) $35,000, as a deposit to
be applied to Administrative Agent’s expenses as set forth in Section 3.10.12 below (the
“Expense Fee”).

     3.10.2 On the date that a Borrower makes the Substitution Request, and at the time of the
closing of the Substitute Loan, there exists no Potential Default or Event of Default under any of
the Loan Documents.

     3.10.3 The Substitute Borrower and Administrative Agent and, as appropriate, the Lenders,
shall enter into such joinders and modifications to the Loan Documents, and shall execute such
promissory notes, as Administrative Agent shall deem necessary so as to obligate the Substitute
Borrower under the Loan Documents. The Substitute Loan shall be evidenced and secured by loan
documents (the “Joinder Loan Documents”) containing the same terms and conditions as the
Loan Documents, including, without limitation, provisions of cross-default and
cross-collateralization and guaranties as Administrative Agent may require in order to provide
Administrative Agent and the Lenders with the same type of security for the Substitute Loan as it
has for the Loans and ensure that the Substitute Project provides the same security for the Loans
as does the Project in question as of the date hereof.

     3.10.4 The Substitute Borrower and the Substitute Project have complied with conditions and
requirements substantially similar to those previously required by Administrative Agent in
connection with the closing of the Loans.

     3.10.5 Administrative Agent’s completion of its then customary due diligence (including,
without limitation, background checks and credit reports) and underwriting processes with respect
to the Substitute Borrower and the Substitute Project, including customary financial, legal, and
physical due diligence, and Administrative Agent’s and the Lenders’ satisfaction with the findings
and results of such due diligence and approval by Administrative Agent’s credit committee.

     3.10.6 Administrative Agent has approved the property manager and the management agreement for
the Substitute Project.

     3.10.7 Borrowers shall have delivered to Administrative Agent (on behalf of the Lenders) of an
opinion of counsel opining as to, among other things, the enforceability of the Joinder Loan
Documents with respect to the Substitute Project and the Substitute Borrower in substantially the
same form and substance as the opinions concerning enforceability and other matters originally
delivered in connection with the Project to be replaced, with reasonable allowance for variations
in applicable state law.

     3.10.8 Administrative Agent shall have received title insurance policies issued by a title
insurance company reasonably acceptable to Administrative Agent in an amount equal to: (x) in the
case of the First Mortgage, the Allocated Loan Amount for the Substitute Project (so long as

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a
“tie-in” endorsement shall be available, otherwise in the amount of the Allocated Loan Amount for
the Substitute Project) and (y) in the case of the Second Mortgage, the amount to be guaranteed by
the Substitute Borrower pursuant a Guaranty to be executed by such Substitute Borrower, and
otherwise conforming to the requirements applicable to the title insurance policies obtained at the
initial closing as provided in Schedule 2.1 or, if the substitution is accomplished by
modification of existing Mortgages, endorsements to the original title policies insuring such
Mortgages as so modified and endorsements to the title insurance policies insuring the other
Mortgages to the effect (and insuring) that Administrative Agent’s (on behalf of the Lenders)
perfected first and second (as applicable) priority Liens in and to the other Projects are
unaffected by such modifications.

     3.10.9 Administrative Agent shall have received a then current “as-built” survey of the
Substitute Project conforming to the requirements applicable to the surveys of the Projects
obtained at the initial closing as provided in Schedule 2.1.

     3.10.10 Cash on Cash Return, Debt Service Coverage and LTV would be not be lower than the Cash
On Cash Return, Debt Service Coverage and LTV for the trailing six (6) consecutive months
immediately prior to such substitution.

     3.10.11 The Joinder Loan Documents are accepted and duly executed together with any
modifications to the other Loan Documents made necessary by the Substitute Loan.

     3.10.12 Administrative Agent and the Lenders are reimbursed for all of Administrative Agent’s
and the Lenders’ expenses (in the event that such expenses exceed the amount of the Expense Fee) in
connection with the making of the Substitute Loan, including, without limitation, Administrative
Agent’s and the Lenders’ due diligence expenses and reasonable attorneys’ fees.

In the event that Administrative Agent and the Lenders determine not to make the Substitute Loan,
Administrative Agent shall refund the amount paid to Administrative Agent under Section
3.10.1 hereof (minus sums sufficient to pay for all Administrative Agent’s and any Lender’s
expenses as set forth in item “3.10.12” above even though the Substitute Loan was not made) to
Borrowers within ten (10) Business Days after Administrative Agent’s written notice to Borrowers
that the Substitute Loan will not be made.

4. INSURANCE, CONDEMNATION, AND IMPOUNDS

4.1 Insurance. Borrowers shall maintain insurance as follows:

     4.1.1 Casualty; Business Interruption. Borrowers shall keep the Projects insured
against damage by fire and the other hazards covered by a standard extended coverage and all-risk
insurance policy for the full insurable value thereof on a replacement cost claim recovery basis
(without reduction for depreciation or co-insurance), and shall maintain such other casualty
insurance as reasonably required by Administrative Agent. Administrative Agent reserves the right
to require from time to time the following additional insurance to the extent such insurance types
are applicable to properties such as the Projects, are customarily required by prudent lenders in
the areas where the Projects are located, and such insurance is available at commercially
reasonable rates: boiler and machinery; earthquake/sinkhole; worker’s compensation; coverage
against acts of terrorism; and/or building law or ordinance. Without

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limiting the generality of
the foregoing, unless Administrative Agent otherwise consents in writing (which consent may be
withheld in Administrative Agent’s sole and absolute discretion), Borrowers shall at all times
maintain law and ordinance coverage with respect to the Project known as “River City Landing” upon
such terms and conditions and in such amount (and with such deductibles) as are included in the
coverage with respect to such Project maintained by Borrowers as of the date hereof (provided,
further, that Borrowers may increase, but not decrease (including by means of increased
deductibles), the amount of such coverage from time to time without Administrative Agent’s
consent). Borrowers shall keep each Project insured against loss by flood if such Project is
located currently or at any time in the future in an area identified by the Federal Emergency
Management Agency as an area having special flood hazards and in which flood insurance has been
made available under the National Flood Insurance Act of 1968, the Flood Disaster Protection Act of
1973 or the National Flood Insurance Reform Act of 1994 (as such acts may from time to time be
amended) in an amount at least equal to the lesser of (i) the maximum amount of the Loans or (ii)
the maximum limit of coverage available under said acts. Any such flood insurance policy shall be
issued in accordance with the requirements and current guidelines of the Federal Insurance
Administration. Borrowers shall maintain use and occupancy insurance covering, as applicable,
rental income or business interruption, with coverage in an amount not less than twelve (12) months
anticipated gross rental income or gross business earnings, as applicable in each case,
attributable to each Project. Borrowers shall not maintain any separate or additional insurance
which is contributing in the event of loss unless it is properly endorsed and otherwise reasonably
satisfactory to Administrative Agent in all respects. The proceeds of insurance paid on account of
any damage or destruction to a Project shall be paid to Administrative Agent to be applied as
provided in Section 4.2.

     4.1.2 Liability. Borrowers shall maintain (a) commercial general liability insurance
with respect to the Projects providing for limits of liability of not less than $5,000,000 for both
injury to or death of a person and for property damage per occurrence, and (b) other liability
insurance as reasonably required by Administrative Agent.

     4.1.3 Form and Quality. All insurance policies shall be endorsed in form and
substance acceptable to Administrative Agent to name Administrative Agent (on behalf of the
Lenders) as an additional insured, loss payee or mortgagee thereunder, as its interest may appear,
with loss payable to Administrative Agent, without contribution, under a standard New York (or
local equivalent) mortgagee clause. All such insurance policies and endorsements shall be fully
paid for and contain such provisions and expiration dates and be in such form and issued by such
insurance companies licensed to do business in the states where the Projects are located, with a
general company and financial size rating of “A-IX” or better as established by Best’s Rating Guide
(or an equivalent rating approved in writing by Administrative Agent). Each policy shall provide
that such policy may not be cancelled or materially changed except upon thirty (30) days’ prior
written notice of intention of non-renewal, cancellation or material change to Administrative Agent
and that no act or thing done by any Borrower shall invalidate any policy as against Administrative
Agent. Blanket policies shall be permitted only if Administrative Agent receives appropriate
endorsements and/or duplicate policies containing Administrative Agent’s right to continue coverage
on a pro rata pass-through basis and that coverage will not be affected by any loss on other
properties covered by the policies. Borrowers authorize Administrative Agent to pay the premiums
for such policies (the “Insurance Premiums”) from the Tax and Insurance Escrow Fund as the
same become due and payable annually in advance. If any Borrower fails to deposit funds into the
Tax and Insurance Escrow Fund sufficient to

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permit Administrative Agent to pay the premiums when
due, Administrative Agent may obtain such insurance and pay the premium therefor and such Borrower
shall, on demand, reimburse Administrative Agent for all expenses incurred in connection therewith.
Borrowers shall assign the policies or proofs of insurance to Administrative Agent (on behalf of
the Lenders), in such manner and form that Administrative Agent and its successors and assigns
shall at all times have and hold the same as security for the payment of the Loans. Borrowers
shall deliver copies of all original policies certified to Administrative Agent by the insurance
company or authorized agent as being true copies, together with the endorsements required
hereunder. The proceeds of insurance policies coming into the possession of Administrative Agent
shall not be deemed trust funds, and Administrative Agent shall be entitled to apply such proceeds
as herein provided.

     4.1.4 Adjustments. Borrowers shall give immediate written notice of any loss to the
insurance carrier and to Administrative Agent. Borrowers irrevocably authorize and empower
Administrative Agent, as attorney-in-fact for Borrowers coupled with an interest, to make proof of
loss, to adjust and compromise any claim under insurance policies, to appear in and prosecute any
action arising from such insurance policies, to collect and receive insurance proceeds, and to
deduct therefrom Administrative Agent’s expenses incurred in the collection of such proceeds.
Nothing contained in this Section 4.1.4, however, shall require Administrative Agent to
incur any expense or take any action hereunder.

4.2 Use and Application of Insurance Proceeds. If any of the Projects shall be damaged or
destroyed, in whole or in part, by fire or other casualty (a “Casualty”), Borrowers shall
give prompt notice thereof to
Administrative Agent. Following the occurrence of a Casualty, the applicable Borrower or
Borrowers, regardless of whether insurance proceeds are available, shall promptly proceed to
restore, repair, replace or rebuild the same to be of at least equal value and of substantially the
same character as prior to such damage or destruction, all to be effected in accordance with
applicable law. Administrative Agent shall apply insurance proceeds to costs of restoring the
relevant Project or Projects or to the payment of Loans as follows:

     4.2.1 if the loss is less than or equal to $250,000, Administrative Agent shall apply the
insurance proceeds to restoration provided (a) no Event of Default or Potential Default exists, and
(b) the applicable Borrowers or Borrower promptly commences and is diligently pursuing restoration
of the relevant Project or Projects;

     4.2.2 if the loss exceeds $250,000 but is not more than 25% of the replacement value of the
improvements (for projects containing multiple phases or stand alone structures, such calculation
to be based on the damaged phase or structure, not the project as a whole), Administrative Agent
shall apply the insurance proceeds to restoration provided that at all times during such
restoration (a) no Event of Default or Potential Default exists; (b) Administrative Agent
determines throughout the restoration that there are sufficient funds available to restore and
repair the relevant Project or Projects to a condition approved by Administrative Agent; (c)
Administrative Agent determines that the Net Operating Income of the relevant Project or Projects
during restoration, taking into account rent loss or business interruption insurance, will be
sufficient to pay Debt Service; (d) Administrative Agent determines that after restoration the
Debt Service Coverage will equal at least the Debt Service Coverage that exists on the Closing Date
hereof; (e) Administrative Agent determines that the LTV of the Projects after restoration will not
exceed the LTV that existed on the Closing Date; (f) Administrative Agent determines that
restoration and repair of the relevant Project or Projects to a condition approved by

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Administrative Agent will be completed within six (6) months after the date of loss or casualty and
in any event ninety (90) days prior to the Maturity Date; (g) the applicable Borrower or Borrowers
promptly commence and is diligently pursuing restoration of the relevant Projects; and (h) the
relevant Project or Projects after the restoration will be in compliance with and permitted under
all applicable zoning, building and land use laws, rules, regulations and ordinances;

     4.2.3 if the conditions set forth above are not satisfied or the loss exceeds the maximum
amount specified in Section 4.2.2 above, in Administrative Agent’s sole discretion,
Administrative Agent may apply any insurance proceeds it may receive to the payment of the Loans or
allow all or a portion of such proceeds to be used for the restoration of the relevant Project or
Projects; and

     4.2.4 Insurance proceeds applied to restoration will be disbursed on receipt of satisfactory
plans and specifications, contracts and subcontracts, schedules, budgets, lien waivers and
architects’ certificates, and otherwise in accordance with prudent commercial construction lending
practices for construction loan advances, including, as applicable, the advance conditions under
Schedule 2.1.

4.3 Condemnation Awards. Borrowers shall immediately notify Administrative Agent of the actual or threatened institution
of any proceeding for the condemnation or other taking of any Project or any portion thereof (a
“Condemnation”) and shall deliver to Administrative Agent copies of any and all papers
served in connection with such Condemnation. Following the occurrence of a Condemnation,
Borrowers, regardless of whether any award or compensation is available, shall promptly proceed to
restore, repair, replace or rebuild the same to the extent practicable to be of at least equal
value and of substantially the same character as prior to such Condemnation, all to be effected in
accordance with applicable law. Administrative Agent may participate in any such proceeding and
Borrowers will deliver to Administrative Agent all instruments necessary or required by
Administrative Agent to permit such participation. Without Administrative Agent’s prior consent
(subject to the approval by the Majority Lenders), Borrowers shall not: (a) agree to any
compensation or award, and (b) act or fail to take any action that would cause the compensation to
be determined. All awards and compensation for the taking or purchase in lieu of condemnation of
any Project or any part thereof are hereby assigned to and shall be paid to Administrative Agent.
Borrowers authorize Administrative Agent to collect and receive such awards and compensation, to
give proper receipts and acquittances therefor, and in Administrative Agent’s sole discretion to
apply the same toward the payment of the Loans, notwithstanding that the Loans may not then be due
and payable, or to the restoration of the affected Project; however, if the award is less than or
equal to $250,000 and Borrowers request that such proceeds be used for non-structural site
improvements (such as landscape, driveway, walkway and parking area repairs) required to be made as
a result of such condemnation, Administrative Agent will apply the award to such restoration in
accordance with disbursement procedures applicable to insurance proceeds provided there exists no
Potential Default or Event of Default. Borrowers, upon request by Administrative Agent, shall
execute all instruments requested to confirm the assignment of the awards and compensation to
Administrative Agent, free and clear of all liens, charges or encumbrances.

4.4 Impounds. Borrowers shall deposit with Administrative Agent, monthly, (i) one-twelfth
(1/12th) of the Taxes that Administrative Agent estimates will be payable during the next

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ensuing
twelve (12) months in order to accumulate with Administrative Agent sufficient funds to pay all
such Taxes at least thirty (30) days prior to their respective due dates and (ii) one-twelfth
(1/12th) of the Insurance Premiums that Administrative Agent estimates will be payable for the
renewal of the coverage afforded by the insurance policies required by Administrative Agent upon
the expiration thereof in order to accumulate with Administrative Agent sufficient funds to pay all
such Insurance Premiums at least thirty (30) days prior to expiration (said amounts in (i) and (ii)
above hereinafter called the “Tax and Insurance Escrow Fund”). At or before the advance of
the Loans, Borrowers shall deposit with Administrative Agent a sum of money that together with the
monthly installments will be sufficient to make each of such payments thirty (30) days prior to the
date any delinquency or penalty becomes due with respect to such payments. Deposits shall be made
on the basis of Administrative Agent’s estimate from time to time of the charges for the current
year (after giving effect to any reassessment or, at Administrative Agent’s election, on the basis
of the charges for the prior year, with adjustments when the charges are fixed for the then current
year). All funds so deposited shall be held by Administrative Agent, without interest, and may be
commingled with Administrative Agent’s general funds. Borrowers hereby grant to Administrative
Agent (on behalf of the Lenders) a security interest in all funds so deposited with Administrative
Agent for
the purpose of securing the Loans. While an Event of Default exists, the funds deposited may be
applied in payment of the charges for which such funds have been deposited, or to the payment of
the Loans or any other charges affecting the security of Administrative Agent and the Lenders, as
Administrative Agent may elect, but no such application shall be deemed to have been made by
operation of law or otherwise until actually made by Administrative Agent. Borrowers shall furnish
Administrative Agent with bills for the charges for which such deposits are required at least
thirty (30) days prior to the date on which the charges first become payable. If at any time the
amount on deposit with Administrative Agent, together with amounts to be deposited by Borrowers
before such charges are payable, is insufficient to pay such charges, Borrowers shall deposit any
deficiency with Administrative Agent immediately upon demand. Administrative Agent shall pay such
charges when the amount on deposit with Administrative Agent is sufficient to pay such charges and
Administrative Agent has received a bill for such charges.

5. ENVIRONMENTAL MATTERS

5.1 Certain Definitions. As used herein, the following terms have the meanings indicated:

     5.1.1 “Environmental Laws” means any federal, state or local law (whether imposed by
statute, ordinance, rule, regulation or administrative or judicial order, or common law), now or
hereafter enacted, governing health, safety, industrial hygiene, the environment or natural
resources, or Hazardous Materials, including, without limitation such laws governing or regulating
(i) the use, generation, storage, removal, recovery, treatment, handling, transport, disposal,
control, release, discharge of, or exposure to, Hazardous Materials, (ii) the transfer of property
upon a negative declaration or other approval of a governmental authority of the environmental
condition of such property, and (iii) requiring notification or disclosure of releases of Hazardous
Materials or other environmental conditions whether or not in connection with a transfer of title
to or interest in property.

     5.1.2 “Hazardous Materials” means (a) petroleum or chemical products, whether in
liquid, solid, or gaseous form, or any fraction or by-product thereof, (b) asbestos or
asbestos-containing materials, (c) polychlorinated biphenyls (PCBs), (d) radon gas,

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(e) underground
storage tanks, (f) any explosive or radioactive substances, (g) lead or lead-based paint, (h) molds
or similar substances, or (i) any other substance, material, waste or mixture that is or shall be
listed, defined, or otherwise determined by any governmental authority to be hazardous, toxic,
dangerous or otherwise regulated, controlled or giving rise to liability under any Environmental
Laws.

5.2 Representations and Warranties on Environmental Matters. To each Borrower’s knowledge,
except as set forth in the Site Assessments, (1) no Hazardous Material is now or was formerly used,
stored, generated, manufactured, installed, disposed of or otherwise present at or about any
Project or any property adjacent to any Project (except for cleaning and other products currently
used in connection with the routine maintenance or repair of such Project in full compliance with
Environmental Laws) and no Hazardous Materials were removed or transported from any Project, (2)
all permits, licenses, approvals and filings required by Environmental Laws have been obtained, and
the use, operation and condition of each Project does not, and did not previously, violate any
Environmental Laws, (3) no civil, criminal or
administrative action, suit, claim, hearing, investigation or proceeding has been brought or been
threatened, nor have any settlements been reached by or with any parties or any liens imposed in
connection with the Project concerning Hazardous Materials or Environmental Laws, and (4) no
underground storage tanks exist on any part of any Project.

5.3 Covenants on Environmental Matters.

     5.3.1 Each Borrower shall (a) comply strictly and in all respects with applicable
Environmental Laws; (b) notify Administrative Agent immediately upon such Borrower’s discovery of
any spill, discharge, release or presence of any Hazardous Material at, upon, under, within,
contiguous to or otherwise affecting any Project; (c) promptly remove such Hazardous Materials and
remediate such Project in full compliance with Environmental Laws or as reasonably required by
Administrative Agent based upon and in accordance with the recommendations and specifications of an
independent environmental consultant approved by Administrative Agent; and (d) promptly forward to
Administrative Agent copies of all orders, notices, permits, applications or other communications
and reports in connection with any spill, discharge, release or the presence of any Hazardous
Material or any other matters relating to the Environmental Laws or any similar laws or
regulations, as they may affect any Project or any Borrower.

     5.3.2 Each Borrower shall not cause, shall prohibit any other Person within the control of
such Borrower from causing, and shall use prudent, commercially reasonable efforts to prohibit
other Persons (including tenants) from (a) causing any spill, discharge or release, or the use,
storage, generation, manufacture, installation, or disposal, of any Hazardous Materials at, upon,
under, within or about the Project or the transportation of any Hazardous Materials to or from any
Project (except for cleaning and other products used in connection with routine maintenance or
repair of such Project in full compliance with Environmental Laws), (b) installing any underground
storage tanks at any Project, or (c) conducting any activity that requires a permit or other
authorization under Environmental Laws.

     5.3.3 Each Borrower shall provide to Administrative Agent, at such Borrower’s expense promptly
upon the written request of Administrative Agent from time to time, a Site Assessment or, if
required by Administrative Agent, an update to any existing Site Assessment,

40

 

to assess the presence
or absence of any Hazardous Materials and the potential costs in connection with abatement, cleanup
or removal of any Hazardous Materials found on, under, at or within the Project. Each Borrower
shall pay the cost of no more than one such Site Assessment or update in any twelve-month period
per Project, unless Administrative Agent’s request for a Site Assessment is based on information
provided under Section 5.3.1, a reasonable suspicion of Hazardous Materials at or near the
Project in question, a breach of representations under Section 5.3.1, or an Event of
Default, in which case any such Site Assessment or update shall be at the applicable Borrower’s
expense.

     5.3.4 Borrowers shall: (i) immediately following the date hereof, retain IVI Environmental,
Inc., or another environmental consultant reasonably acceptable to Agent (the “Environmental
Consultant”) to manage the abatement of lead based paint at each of the Projects identified in
Schedule 5.3.4 attached hereto (the “LBP 
Projects”), and to oversee the work of any contractors or subcontractors hired in
connection therewith; (ii) within ninety (90) days of the date hereof (the “Survey Completion
Date”) cause the Environmental Consultant to complete a comprehensive environmental survey of
each LBP Project detailing all damaged and undamaged lead based paint at the such LBP Projects
(including, without limitation, in any of the units and/or common areas); (iii) within thirty (30)
days of the Survey Completion Date cause the Environmental Consultant to (A) prepare a hazard
assessment, (B) establish an operations and maintenance plan which is reasonably satisfactory to
Agent to manage the overall continuing maintenance and abatement of lead based paint at each LBP
Project (the “Lead Based Paint Operations and Maintenance Plan”), and (C) establish and
implement an abatement plan which is satisfactory to Agent to manage the abatement of all damaged
lead based paint detected in the environmental survey described in this Section (the “Abatement
Plan”); (iv) immediately after the establishment of the Abatement Plan, (A) file the Abatement
Plan with the appropriate state agency in each state in which the LBP Projects are located (each a
“State Agency”), (B) complete any revisions required by any such State Agency, and (C)
obtain approval of the Abatement Plan from each State Agency; (v) finalize a budget (the
“Abatement Budget”), acceptable to Agent, for all costs (including but not limited to
remediation, monitoring, tenant relocation and notification costs) related to the Abatement
Program, which budget shall not be modified without Agent’s approval; (vi) cause the Environmental
Consultant to enter into a contract with a lead based paint abatement contractor or contractors,
reasonably acceptable to Agent or Agent’s environmental consultant, which contractor or
contractor(s) will remediate all areas at any of the LBP Projects requiring such lead based paint
remediation; (vii) cause the Environmental Consultant to (A) complete any appropriate documentation
and records to show that the lead based paint was abated properly and completely, and (B) file any
necessary documents with each State Agency, as each such agency may then require; (vii) receive
confirmation without condition from each State Agency that each such LBP Project is in compliance
with all applicable laws related to the lead paint removal and the activities referred to in this
Section; and (ix) receive confirmation from Agent that the remediation of the lead based paint is
satisfactory to Agent’s environmental risk assessment team ((i) through (ix) above, collectively,
the “Abatement Program”) . Notwithstanding anything to the contrary herein, (x) Borrowers
shall maintain and continue any existing Lead Based Paint Operations and Maintenance Plan with
respect to any Project which Administrative Agent has an existing Lien that is in existence as of
the Closing Date, (y) to the extent they exist, Borrowers shall provide to Administrative Agent for
review and approval any existing Lead Based Paint Operations and Maintenance Plan with respect to
any other Project that is in existence as of the Closing Date,

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and (z) Borrowers shall cause the
Abatement Program for the Project known as “200 Fountain” to be completed within one year from the
date hereof.

     5.3.5 Borrowers shall, within forty-five (45) days of the date hereof, (iv) establish and
implement an operations & maintenance plan for each of the Projects identified on Schedule
5.3.5 attached hereto (the “O&M Plan Projects”), which are reasonably satisfactory to
Agent, to manage asbestos containing materials (“ACM”) at the O&M Plan Projects (the
“Asbestos Operations & Maintenance Plans”). Borrowers shall promptly abate any damaged ACM
found at such O&M Plan Projects in a manner which is in compliance with all applicable laws.
Borrowers shall not modify the Asbestos Operations & Maintenance Plans without Agent approval, and
shall, at all times,
comply with the terms and provisions thereof, as applicable. Notwithstanding anything to the
contrary herein, (x) Borrowers shall maintain and continue any existing Asbestos Operations and
Maintenance Plan with respect to any Project which Administrative Agent has an existing Lien that
is in existence as of the Closing Date, and (y) to the extent they exist, Borrowers shall provide
to Administrative Agent for review and approval any existing Asbestos Paint Operations and
Maintenance Plan with respect to any other Project that is in existence as of the Closing Date.

     5.3.6 Borrowers shall: (i) immediately following the date hereof, retain Environmental
Consultant to conduct Underground Storage Tank (“UST”) System tightness testing at the
Projects identified on Schedule 5.3.6 attached hereto (the “UST Projects”) and to
oversee the work of any contractors or subcontractors hired in connection therewith; (ii) within
forty-five (45) days of the date hereof, cause the Environmental Consultant to complete a
comprehensive assessment of the UST tightness testing for each UST Project (each an “UST
Tightness Assessment”) and submit the same to Agent for review and approval; and (iii) take any
action necessary at each UST Project to comply with any recommendations contained in such UST
Tightness Assessments in accordance therewith, which actions shall be approved by Agent or Agent’s
environmental consultant. In addition, prior to the date hereof Borrowers shall have caused the
removal of two (2) 55-gallon drums located at the Project identified in Schedule 5.3.4(c).
Borrowers shall, within ninety (90) days of the date hereof, cause the secondary containment of the
above ground storage tank located adjacent to the fire-suppression system pump located at The
Liberty Building Project, in accordance with the recommendations set forth in the Site Assessment
for such Project.

     5.3.7 Borrowers shall, immediately following the date hereof: (i) retain Environmental
Consultant to conduct a Phase II Environmental Site Assessment (a “Phase II Assessment”) of
each of the Projects identified on Schedule 5.3.7 attached hereto (the “Phase II
Projects”), in accordance with the proposal prepared for Administrative Agent, titled:
Proposal, Phase II Environmental Site Assessment, submitted by IVI Environmental, Inc., dated as of
November 16, 2005, and to oversee the work of any contractors or subcontractors hired in connection
therewith; and (ii) within forty-five (45) days of the date hereof, cause the Environmental
Consultant to complete a Phase II Assessment for each Phase II Project and submit the same to Agent
for review and approval.

     5.3.8 Borrowers shall prohibit the operation of a dry cleaning facility to be conducted at any
of the Projects.

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5.4 Allocation of Risks and Indemnity. As between Borrowers, Administrative Agent and the
Lenders, all risk of loss associated with non-compliance with Environmental Laws, or with the
presence of any Hazardous Material at, upon, within, contiguous to or otherwise affecting any
Project, shall lie solely with Borrowers. Accordingly, Borrowers shall bear all risks and costs
associated with any loss (including any loss in value attributable to Hazardous Materials), damage
or liability therefrom, including all costs of removal of Hazardous Materials or other remediation
required by Administrative Agent or by law. Borrowers shall jointly and severally indemnify,
defend and hold Administrative Agent and the Lenders and their respective shareholders, directors,
officers, employees and agents harmless from and against all loss, liabilities, damages, claims,
costs and expenses (including reasonable
costs of defense and consultant fees, investigation and laboratory fees, court costs, and other
litigation expenses) arising out of or associated, in any way, with (a) the non-compliance with
Environmental Laws, (b) the existence of Hazardous Materials in, on, or about any Project, (c) any
personal injury (including wrongful death) or property damage (real or personal) arising out of or
related to Hazardous Materials, (d) any lawsuit brought or threatened, settlement reached, or
government order relating to such Hazardous Materials, (e) any breach of any representation,
warranty or covenant contained in this Article 5, whether based in contract, tort, implied
or express warranty, strict liability, criminal or civil statute or common law, including those
arising from the joint, concurrent, or comparative negligence of Administrative Agent; or (f) the
imposition of any environmental Lien encumbering any Project; provided, however,
Borrowers shall not be liable under such indemnification to the extent such loss, liability,
damage, claim, cost or expense results solely from Administrative Agent’s or any Lender’s gross
negligence or willful misconduct. Borrowers’ obligations under this Section 5.4 shall
arise upon the discovery of the presence of any Hazardous Materials, whether or not any
governmental authority has taken or threatened any action in connection with the presence of any
Hazardous Material, and whether or not the existence of any such Hazardous Material or potential
liability on account thereof is disclosed in the Site Assessment and shall continue notwithstanding
the repayment of the Loans or any transfer or sale of any right, title and interest in the Project
in question (by foreclosure, deed in lieu of foreclosure or otherwise). Additionally, if any
Hazardous Materials affect or threaten to affect any Project, Administrative Agent may (but shall
not be obligated to) give such notices and take such actions as it deems necessary or advisable at
the expense of the Borrowers in order to abate the discharge of any Hazardous Materials or remove
the Hazardous Materials. Any amounts payable to Administrative Agent by reason of the application
of this Section 5.4 shall become immediately due and payable and shall bear interest at the
Default Rate from the date loss or damage is sustained by Administrative Agent until paid. The
obligations and liabilities of Borrowers under this Section 5.4 shall survive any
termination, satisfaction, assignment, entry of a judgment of foreclosure or delivery of a deed in
lieu of foreclosure.

5.5 No Waiver. Notwithstanding any provision in this Article 5 or elsewhere in the
Loan Documents, or any rights or remedies granted by the Loan Documents, Administrative Agent and
the Lenders do not waive and expressly reserve all rights and benefits now or hereafter accruing to
Administrative Agent and/or any Lender under the “security interest” or “secured creditor”
exception under applicable Environmental Laws, as the same may be amended. No action taken by
Administrative Agent and/or any Lender pursuant to the Loan Documents shall be deemed or construed
to be a waiver or relinquishment of any such rights or benefits under the “security interest
exception.”

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6. LEASING MATTERS

6.1 Representations and Warranties on Leases. Borrowers represent and warrant to
Administrative Agent and the Lenders with respect to leases of the Projects that: (1) to Borrowers’
knowledge, the rent rolls delivered to Administrative Agent are true and correct, and the Leases
are valid and in and full force and effect; (2) the Leases (including amendments) are in writing,
and there are no oral agreements
with respect thereto; (3) the copies of the Leases delivered to Administrative Agent, if any, are
true and complete; (4) neither the landlord nor, except as set forth on such rent rolls, any tenant
is in default under any of the Leases; (5) except as set forth on such rent rolls, no Borrower has
knowledge of any notice of termination or default with respect to any Lease; (6) no Borrower has
assigned or pledged any of the Leases, the Rents or any interests therein except to Administrative
Agent (on behalf of the Lenders); (7) no tenant or other party has an option to purchase all or any
portion of any Project; (8) no tenant has the right to terminate its Lease prior to expiration of
the stated term of such Lease; (9) no tenant has prepaid more than one month’s Rent in advance
(except for bona fide security deposits not in excess of an amount equal to two month’s Rent); (10)
all existing Leases are subordinate to the Mortgages, either pursuant to the terms of such Leases
or a recorded subordination agreement; and (11) all leases are residential Leases and require the
occupancy thereunder by Tenant or its permitted subtenant, if any.

6.2 Standard Lease Form; Approval Rights. All Leases and other rental arrangements shall
in all respects be approved by Administrative Agent, shall be on a standard lease form approved by
Administrative Agent with no modifications (except as approved by Administrative Agent) and shall
comply with the leasing criteria approved by Administrative Agent from time to time. Borrowers
shall hold, in trust, all tenant security deposits in a segregated account to the extent required
by applicable law. Within ten (10) days after Administrative Agent’s request, Borrowers shall
furnish to Administrative Agent a statement of all tenant security deposits, and copies of all
Leases not previously delivered to Administrative Agent, certified by Borrowers as being true,
correct, and complete.

Notwithstanding anything contained in the Loan Documents, Administrative Agent’s approval shall not
be required for future Leases or Lease extensions if the following conditions are satisfied: (i)
there exists no Potential Default or Event of Default; (ii) the Lease is on the standard lease form
approved by Administrative Agent with no modifications; (iii) the Lease does not conflict with any
restrictive covenant affecting the relevant Project or any other lease for space in the relevant
Project; and (iv) the effective rental rate of the Lease is a market rate.

6.3 Covenants. Each Borrower shall: (1) perform the obligations that such Borrower is
required to perform under the Leases; (2) enforce the obligations to be performed by the tenants in
accordance with prudent property management practices; (3) not collect any rents for more than
thirty (30) days in advance of the time when the same shall become due, except for bona fide
security deposits not in excess of an amount equal to two (2) month’s Rent; (4) not enter into any
ground Lease or master Lease of any part of such Borrower’s Project(s); (5) not further assign or
encumber any Lease; (6) not, except with Administrative Agent’s prior written consent, cancel or
accept surrender or termination of any Lease except for default in accordance with prudent property
management practices; (7) not, except with Administrative Agent’s prior written consent, modify or
amend any Lease (except for modifications and amendments entered into in the ordinary course of
business, consistent with prudent property management practices);

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and (8) shall assign to
Administrative Agent any letter of credit evidencing a security deposit on such terms as may be
required by any lender and shall deliver the original of such letter(s) of credit to Administrative
Agent. Any action in violation of clauses (4), (5), (6), and (7) of this Section 6.3 shall
be void at the election of Administrative Agent.

6.4 Tenant Estoppels. At Administrative Agent’s request, Borrowers shall obtain and
furnish to Administrative Agent, written estoppels in form and substance reasonably satisfactory to
Administrative Agent, executed by tenants under “corporate” or master Leases of any part of the
related Project and confirming the term, Rent, and other provisions and matters relating to the
Leases.

7. REPRESENTATIONS AND WARRANTIES

Each Borrower represents and warrants to Administrative Agent and the Lenders, each of which
representations and warranties shall be deemed to be made, as of the date hereof and as of the date
of any Additional Advance, any Partial Release, any Substitution, and any permitted transfer, both
as to each and every Borrower (whether each representation or warranty refers to a “Borrower” or
the “Borrowers”) and as to each and every Project (whether each representation or warranty refers
to a “Project” or the “Projects”) that:

7.1 Organization and Power. Each Borrower and each Borrower Party is duly organized,
validly existing and in good standing under the laws of the state of its formation or existence,
and complies with legal requirements applicable to doing business in the state in which the
Project(s) owned by such Borrower is located, and has the necessary governmental approvals to own
and operate the Project(s) owned by such Borrower and conduct the business now conducted or to be
conducted thereon. Each Borrower has the full power, authority and right to execute, deliver and
perform its obligations pursuant to this Loan Agreement and the other Loan Documents, and to
mortgage the Project(s) owned by such Borrower pursuant to the terms of the First Mortgage(s) and
the Second Mortgage(s) executed by such Borrower and to keep and observe all of the terms of this
Loan Agreement and the other Loan Documents on such Borrower’s part to be performed. No Borrower
is a “foreign person” within the meaning of § 1445(f)(3) of the Internal Revenue Code.

7.2 Validity of Loan Documents. The execution, delivery and performance by each Borrower
and each Borrower Party of the Loan Documents: (1) are duly authorized and do not require the
consent or approval of any other party or governmental authority that has not been obtained; and
(2) will not violate any law or result in the imposition of any lien, charge or encumbrance upon
the assets of any such party, except as contemplated by the Loan Documents. The Loan Documents
constitute the legal, valid and binding obligations of each Borrower and each Borrower Party,
enforceable in accordance with their respective terms, subject to applicable bankruptcy,
insolvency, or similar laws generally affecting the enforcement of creditors’ rights.

7.3 Liabilities; Litigation.

     7.3.1 The financial statements delivered by each Borrower and each Borrower Party are true and
correct with no significant change since the date of preparation. Except as disclosed in such
financial statements, there are no liabilities (fixed or contingent) affecting any of the Projects,
any Borrower or any Borrower Party. Except as disclosed in such financial statements,
there is no litigation, administrative proceeding, investigation or other legal action
(including any

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proceeding under any state or federal bankruptcy or insolvency law) pending or, to
the knowledge of any Borrower, threatened, against any of the Projects, any Borrower or any
Borrower Party that if adversely determined could have a material adverse effect on such party, any
Project or the Loans.

     7.3.2 None of the Borrowers nor any Borrower Party is contemplating either the filing of a
petition by it under state or federal bankruptcy or insolvency laws or the liquidation of all or a
major portion of its assets or property, and none of the Borrower nor any Borrower Party has
knowledge of any Person contemplating the filing of any such petition against it.

7.4 Taxes and Assessments. Each Project is comprised of one or more parcels, each of which
constitutes a separate tax lot and none of which constitutes a portion of any other tax lot. There
are no pending or, to each Borrower’s best knowledge, proposed, special or other assessments for
public improvements or otherwise affecting any Project, nor are there any contemplated improvements
to any Project that may result in such special or other assessments.

7.5 Other Agreements; Defaults. None of the Borrowers nor any Borrower Party is a party to
any agreement or instrument or subject to any court order, injunction, permit, or restriction that
might adversely affect any Project or the business, operations, or condition (financial or
otherwise) of any Borrower or any Borrower Party. None of the Borrowers nor any Borrower Party is
in violation of any agreement, which violation would have an adverse effect on any Project, any
Borrower, or any Borrower Party or any Borrower’s or any Borrower Party’s business, properties, or
assets, operations or condition, financial or otherwise.

7.6 Compliance with Law and Covenants.

     7.6.1 Each Borrower and each Borrower Party have all requisite licenses, permits, franchises,
qualifications, certificates of occupancy or other governmental authorizations to own, lease and
operate and occupy the Project(s) of such Borrower and carry on its business, and each Project is
in compliance with all applicable legal requirements, including all legal requirements relating to
zoning and use, and is free of structural defects, and all building systems contained therein are
in good working order, subject to ordinary wear and tear. No Project constitutes, in whole or in
part, a legally non-conforming use under applicable legal requirements;

     7.6.2 No condemnation has been commenced or, to any Borrower’s knowledge, is contemplated with
respect to all or any portion of any Project or for the relocation of roadways providing access to
any Project;

     7.6.3 Each Project has adequate rights of access to public ways and is served by adequate
water, sewer, sanitary sewer and storm drain facilities. All public utilities necessary or
convenient to the full use and enjoyment of each Project are located in the public right-of-way
abutting such Project, and all such utilities are connected so as to serve such Project without
passing over other property, except to the extent such other property is subject to a
perpetual easement for such utility benefiting such Project. All roads necessary for the full
utilization of each Project for its current purpose have been completed and dedicated to public use
and accepted by all governmental authorities;

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     7.6.4 To the best of Borrowers’ knowledge: Each Project is in compliance with all REAs
relating to such Project; each REA is in full force and effect and has not been amended, modified
or supplemented other than as shown in the Title Policies; there is neither any default nor any
event which, with the passage of time or the giving of notice, or both, would constitute a default
under an REA by any of the parties thereto and no other party to an REA has any offsets, claims or
defenses to the enforcement thereof; all construction obligations and parking requirements to be
completed or satisfied by Borrower on or prior to the date hereof under the REAs have been
performed and satisfied, and there are no payments currently due and delinquent from a Borrower
under any REA; and there are no currently existing condition which permit, or with the passage of
time or the giving of notice, or both, will permit, any other party to exercise any right of early
termination under any REA.

7.7 Location of Borrowers. Each Borrower’s principal place of business and chief executive
offices are located at the address stated in Section 12.1.

7.8 ERISA. As of the date hereof and throughout the term of the Loans, no Borrower has
established, nor will establish, any pension plan for employees that would cause such Borrower to
be subject to the Employee Retirement Income Security Act of 1974, as amended.

7.9 Margin Stock. No part of proceeds of the Loans will be used for purchasing or
acquiring any “margin stock” within the meaning of Regulations G, T, U or X of the Board of
Governors of the Filings Federal Reserve System.

7.10 Tax Filing. Each Borrower and each Borrower Party has filed (or has obtained
effective extensions for filing) all federal, state and local tax returns required to be filed and
has paid or made adequate provision for the payment of all federal, state and local taxes, charges
and assessments payable by such Borrower and each such Borrower Party, respectively.

7.11 Solvency. Giving effect to the Loans (and each Borrower’s obligations with respect
thereto), the fair saleable value of each Borrower’s assets exceeds and will, immediately following
the making of the Loans, exceed such Borrower’s total liabilities, including, without limitation,
subordinated, unliquidated, disputed and contingent liabilities. The fair saleable value of each
Borrower’s assets is and will, immediately following the making of the Loans, be greater than such
Borrower’s probable liabilities, including the maximum amount of its contingent liabilities on its
Debts as such Debts become absolute and matured. No Borrower’s assets either immediately before or
immediately following the making of the Loans will constitute unreasonably small capital to carry
out its business as conducted or as proposed to be conducted. No Borrower intends to, nor does any
Borrower believe that it will, incur Debts and liabilities (including contingent liabilities and
other commitments) beyond its ability to pay such Debts as they mature (taking into account the
timing and amounts of cash to be received by each Borrower and the amounts to be payable on or in
respect of obligations of Borrower). Except as expressly disclosed to Administrative Agent in
writing, no petition in bankruptcy has been filed against any Borrower or any Borrower Party in the
last seven (7) years, and no Borrower nor any Borrower Party in the last seven (7) years has ever
made an assignment for the benefit of creditors or taken advantage of any insolvency act for the
benefit of debtors.

7.12 Full and Accurate Disclosure. No statement of fact made by or on behalf of any
Borrower or any Borrower Party in this Agreement or in any of the other Loan Documents

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contains
any untrue statement of a material fact or omits to state any material fact necessary to make
statements contained herein or therein not misleading. There is no fact presently known to any
Borrower that has not been disclosed to Administrative Agent that adversely affects, nor as far as
any Borrower can foresee, might adversely affect, any Project or the business, operations or
condition (financial or otherwise) of any Borrower or any Borrower Party.

7.13 Single Purpose Entity.

     7.13.1 Each Borrower represents, warrants and covenants as follows:

     A. Such Borrower has not owned, does not own, and will not own any asset or property
other than (x) one or more Projects, and (y) incidental personal property necessary for the
ownership or operation of the Project(s) owned by it.

     B. Such Borrower will not engage in any business other than the ownership, management
and operation of the Project(s) owned by it and such Borrower will conduct and operate its
business as presently conducted and operated.

     C. Except with respect to the Loan Documents, such Borrower will not enter into any
contract or agreement with any Affiliate of the Borrower, any constituent party of such
Borrower, or any Affiliate of any constituent party, except upon terms and conditions that
are intrinsically fair and substantially similar to those that would be available on an
arms-length basis with third parties other than any such party.

     D. Except with respect to the Loan Documents, such Borrower has not incurred and will
not incur any Debt other than (x) the Loans, (y) trade and operational debt incurred in the
ordinary course of business with trade creditors and in amounts as are normal and reasonable
under the circumstances, provided such debt is not evidenced by a note and is paid when due,
and (z) Debt incurred in the financing of equipment and other personal property used on the
Project(s) owned by it. No indebtedness other than the Loans may be secured (subordinate or
pari passu) by the Project(s) owned by it.

     E. Such Borrower has not made and will not make any loans or advances to any third
party (including any affiliate or constituent party or any affiliate of any constituent
party), and shall not acquire obligations or securities of its affiliates or any constituent
party.

     F. Such Borrower is and will remain solvent and such Borrower will pay its debts and
liabilities (including, as applicable, shared personnel and overhead expenses) from its own
funds and assets as the same shall become due.

     G. Such Borrower has done or caused to be done and will do all things necessary to
observe organizational formalities and preserve its existence, and such Borrower will not,
nor will such Borrower permit, any constituent party to materially amend, modify or
otherwise change the partnership certificate, partnership agreement, articles of
incorporation and bylaws, operating agreement, trust or other organizational documents of
such Borrower or such constituent party without the prior written consent of Administrative
Agent.

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     H. Such Borrower will maintain separate books, records, and financial statements;
provided, however, that each Borrower’s assets and liabilities may be included in a
consolidated financial statement issued by an affiliate of the Borrowers. Such Borrower
shall maintain its books, records, resolutions and agreements as official records.

     I. Such Borrower will be, and at all times will hold itself out to the public as a
legal entity separate and distinct from any other entity (including any Affiliate of any
Borrower, any constituent party of any Borrower, or any Affiliate of any constituent party),
shall correct any known misunderstanding regarding its status as a separate entity, shall
conduct business in its own name, and shall not identify itself or any of its Affiliates as
a division or part of the other ; provided, however, each Borrower’s assets and liabilities
may be included in a consolidated financial statement issued by an affiliate of the
Borrowers; and shall maintain and utilize a separate telephone number, if any, and separate
stationery, invoices and checks.

     J. Such Borrower will maintain adequate capital for the normal obligations reasonably
foreseeable in a business of its size and character and in light of its contemplated
business operations.

     K. Neither such Borrower nor any constituent party will seek the dissolution, winding
up, liquidation, consolidation or merger in whole or in part, of such Borrower.

     L. Such Borrower has and will maintain its assets in such a manner that it will not be
costly or difficult to segregate, ascertain or identify its individual assets from those of
any Affiliate or constituent party, or any Affiliate of any constituent party, or any other
person.

     M. Such Borrower does not and will not hold itself out to be responsible for the debts
or obligations of any other person, except as otherwise permitted in accordance with this
Agreement.

7.14 Ownership of the Project; Liens (i) Each Borrower owns good, insurable, and
marketable title to the Project(s) shown to be owned by such Borrower on Schedule 4
attached hereto, subject only to the Permitted Encumbrances; and (ii) no Project is subject to any
liens except Permitted Encumbrances.

7.15 Parking Each Project includes sufficient parking spaces, presently used and operated
as such, to comply with all applicable legal requirements and to permit the applicable Borrower to
operate a residential apartment complex on such Project in compliance with all legal requirements.

7.16 Forfeiture. There has not been and shall never be committed by any Borrower or any
other person in occupancy of or involved with the operation or use of any Project any act or
omission affording the federal government or any state or local government the right of forfeiture
as against any Project or any part thereof or any monies paid in performance of any Borrower’s
obligations under any of the Loan Documents. Borrower hereby covenants and agrees not to commit,
permit or suffer to exist any act or omission affording such right of forfeiture.

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7.17 Flood Zone. No portion of the improvements comprising any of the Projects is located
in an area identified by the Secretary of Housing and Urban Development or any successor thereto as
an area having special flood hazards pursuant to the National Flood Insurance Act of 1968, the
Flood Disaster Protection Act of 1973 or the National Flood Insurance Act of 1994, as amended, or
any successor law, or, if located within any such area, the applicable Borrower has obtained and
will maintain the insurance prescribed in Section 4.1 hereof.

7.18 Reserved.

7.19 Reserved.

7.20 Structure Chart The organizational structure chart set forth at Exhibit G,
attached hereto and made a part hereof, accurately describes the name, organizational status, and
relationship among each of the entities listed on such chart.

8. FINANCIAL REPORTING

8.1 Financial Statements.

     8.1.1 Monthly Reports. Within thirty (30) days after the end of each fiscal month,
Borrowers shall furnish to Administrative Agent a current (as of the fiscal month just ended)
detailed operating statement for each Project and for all of the Borrowers and Projects (on an
aggregate basis) (showing monthly activity and year-to-date) stating Operating Revenues, Operating
Expenses, operating income and an updated rent roll, and, as requested by Administrative Agent, a
written statement setting forth any variance from the annual budget, copies of bank statements and
bank reconciliations and other documentation supporting the information disclosed in the most
recent financial statements.

     8.1.2 Quarterly Reports. Within forty-five (45) days after the end of each fiscal
quarter, Borrowers shall furnish to Administrative Agent a detailed operating statement (showing
quarterly activity and year-to-date) stating Operating Revenues, Operating Expenses, operating
income and balance sheet for the calendar quarter just ended for each Borrower and each Project and
for all of the Borrowers and Projects (on an aggregate basis).

     8.1.3 Annual Reports. Within ninety (90) days after the end of each fiscal year of
Borrowers’ operation of the Projects, Borrowers shall furnish to Administrative Agent a current (as
of the end of such fiscal year) balance sheet, and a detailed operating statement stating Operating
Revenues, Operating Expenses, operating income for each Borrower and each Project and for all of
the Borrowers and Projects (on an aggregate basis), and, if required by Administrative Agent after
the occurrence and during the continuation of an Event of Default or Potential Default, prepared on
a review basis and certified by an independent public accountant satisfactory to Administrative
Agent.

     8.1.4 Certification; Supporting Documentation. Each such financial statement shall be
in scope and detail satisfactory to Administrative Agent and certified by the chief financial
representative of each Borrower.

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8.2 Accounting Principles. All financial statements shall be prepared in accordance with
sound accounting principles applicable to commercial real estate, consistently applied from year to
year.

8.3 Other Information; Access. Each Borrower shall deliver to Administrative Agent such
additional information regarding such Borrower, its subsidiaries, its business, any Borrower Party,
and any Project within thirty (30) days after Administrative Agent’s request therefor. Each
Borrower shall permit Administrative Agent to examine such records, books and papers of such
Borrower which reflect upon its financial condition and the income and expenses of the Project(s)
owned by such Borrower. In the event that any Borrower fails to forward the financial statements
required in this Article 8 within thirty (30) days after written request, Administrative
Agent shall have the right to audit such records, books and papers at such Borrower’s expense.

8.4 Annual Budgets. At least thirty (30) days before the commencement of each fiscal year,
Borrowers will provide to Administrative Agent their proposed annual operating budgets and annual
capital budgets for such fiscal year for review and approval by Administrative Agent.

8.5 Audits. Administrative Agent shall have the right to choose and appoint a certified
public accountant to perform financial audits as it deems necessary, including, but not limited to,
Administrative Agent’s verification of Cash on Cash Return, Debt Service Coverage, Net Operating
Income and such similar items, at Borrowers’ expense. Borrowers shall permit Administrative Agent
to examine such records, books and papers of Borrowers that reflect upon its financial condition
and the income and expense relative to the Projects.

9. COVENANTS

Each Borrower covenants and agrees with Administrative Agent and the Lenders as follows:

9.1 Due on Sale and Encumbrance; Transfers of Interests. Notwithstanding anything to the
contrary contained in the organizational documents of any Borrower or any Borrower’s managing
member or general partner, without the prior written consent of Administrative Agent:

     9.1.1 no Borrower nor any other Person having a direct or indirect ownership or beneficial
interest in any Borrower shall (a) sell, transfer, convey, mortgage, pledge, or assign any interest
in any Project or any part thereof (including any partnership or any other ownership interest in
any Borrower or Borrower’s general partner or managing member); (b) further encumber, alienate,
grant a Lien or grant any other interest in any Project or any part thereof (including any
partnership or other ownership interest in any Borrower or any Borrower’s general partner or
managing member), whether voluntarily or involuntarily; or (c) enter into any easement or other
agreement granting rights in or restricting the use or development of any Project;

     9.1.2 no new general partner, member or limited partner having the ability to control the
affairs of a Borrower shall be admitted to or created in any Borrower (nor shall any existing
general partner or member or controlling limited partner withdraw from a Borrower), and no change
in any Borrower’s organizational documents relating to control over such Borrower and/or any
Project shall be effected; and

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     9.1.3 Notwithstanding the other provisions of this Section 9.1, no transfer (including
transfers pursuant to any Lease of other occupancy agreement involving any Project) shall be
permitted without the applicable Borrower demonstrating to Administrative Agent’s satisfaction the
compliance of such transfer with the applicable provisions of the “Patriot Act”, as the same may
hereafter be amended or which would be contrary to Article 14 hereof.

As used in this Section 9.1, “transfer” shall include the sale, transfer, conveyance,
mortgage, pledge or assignment of the legal or beneficial ownership of (a) any Project or any
Borrower, (b) any partnership or membership interest in any general partner or member in any
Borrower that is a partnership, or limited liability company, as applicable and (c) any voting
stock in any general partner in any Borrower that is a corporation; “transfer” shall not include
(i) the leasing of individual units within any Project so long as the applicable Borrower complies
with the provisions of the Loan Documents relating to such leasing activity; or (ii) transfers of
limited partner interests in Borrower so long as the provisions of Sections 9.1.1, and
9.1.2 are satisfied.

9.2 Taxes; Utility; Charges. Except to the extent sums sufficient to pay all Taxes have
been previously deposited with Administrative Agent as part of the Tax and Insurance Escrow Fund
and subject to each Borrower’s right to contest in accordance with Section 12.26 hereof,
each Borrower shall pay before any fine, penalty, interest or cost may be added thereto, and shall
not enter into any agreement to defer, any real estate taxes and assessments, franchise taxes and
charges, and other governmental charges (the “Taxes”) that may become a Lien upon its
Project(s) or become payable during the term of the Loans, and will promptly furnish Administrative
Agent with evidence of such payment; however, such Borrower’s compliance with Section 4.4
relating to impounds for taxes and assessments shall, with respect to payment of such taxes and
assessments, be deemed compliance with this Section 9.2. No Borrower shall suffer or permit the
joint assessment of its Project(s) with any other real property constituting a separate tax lot or
with any other real or personal property. Each Borrower shall pay when due all claims and demands
of mechanics, materialmen, laborers and others that, if unpaid, might result in a Lien on its
Project(s).

9.3 Control; Management. There shall be no change in the Control and management of any
Borrower or any Borrower’s general partner or managing member, as applicable, without the prior
written consent of Administrative Agent. No Borrower shall modify or amend its partnership
agreement, limited liability company agreement or certificate of incorporation and bylaws, as
applicable, without the prior, written consent of Administrative Agent. No Borrower shall
terminate, replace or appoint any Manager or terminate or amend the Management Agreement for its
Project(s) without Administrative Agent’s prior written approval. Any change in ownership or
control of a Manager shall be cause for Administrative Agent to re-approve such Manager and
Management Agreement. Each Manager shall hold and maintain all necessary licenses, certifications
and permits required by law. Each Borrower shall fully perform all of its covenants, agreements
and obligations under the Management Agreement to which such Borrower is a party.

9.4 Operation; Maintenance; Inspection; Use. Each Borrower shall observe and comply with
all requisite licenses, permits, franchises, qualifications, certificates of occupancy and other
governmental authorizations to own, use, operate, maintain and occupy its Project(s) and otherwise
comply with all legal requirements applicable thereto. Each Borrower shall maintain its Project(s)
in good condition and promptly repair any damage or casualty. Each Borrower

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shall permit
Administrative Agent and the Lenders and their agents, representatives and employees, upon
reasonable prior notice to such Borrower, to inspect its Project(s) and conduct such environmental
and engineering studies as Administrative Agent may require, provided such inspections and studies
do not materially interfere with the use and operation of such Project(s). Without Administrative
Agent’s prior written consent, no Borrower shall file or subject any part of any Project to any
declaration of condominium or co-operative or convert any part of any Project to a condominium,
co-operative or other direct or indirect form of multiple ownership and governance.

9.5 Taxes on Security. Borrowers shall pay all taxes, charges, filing, registration and recording fees, excises and
levies payable with respect to the Notes or the Liens created or secured by the Loan Documents,
other than income, franchise and doing business taxes imposed on Administrative Agent or any
Lender. If there shall be enacted any law (1) deducting the Loans from the value of the Projects
for the purpose of taxation, (2) affecting any Lien on any Project, or (3) changing existing laws
of taxation of mortgages, deeds of trust, security deeds, or debts secured by real property, or
changing the manner of collecting any such taxes, Borrowers shall promptly pay to Administrative
Agent, on demand, all taxes, costs and charges for which Administrative Agent or any Lender is or
may be liable as a result thereof; however, if such payment would be prohibited by law or would
render the Loans usurious, then instead of collecting such payment, Administrative Agent (and on
the request of the Majority Lenders shall) may declare all amounts owing under the Loan Documents
to be immediately due and payable.

9.6 Legal Existence; Name, Etc. Each Borrower and each general partner or managing member
of each Borrower, as the case may be, shall preserve and keep in full force and effect its
existence as a Single Purpose Entity, entity status, franchises, rights and privileges under the
laws of the state of its formation, and all qualifications, licenses and permits applicable to the
ownership, use and operation of its Projects. No Borrower nor any general partner or managing
member of any Borrower, as the case may be, shall wind up, liquidate, dissolve, reorganize, merge,
or consolidate with or into, or convey, sell, assign, transfer, lease, or otherwise dispose of all
or substantially all of its assets, or acquire all or substantially all of the assets of the
business of any Person, or permit any subsidiary or Affiliate of any Borrower to do so. Each
Borrower and each general partner or managing member of each Borrower, as the case may be, shall
conduct business only in its own name and shall not change its name, identity, or organizational
structure, or the location of its chief executive office or principal place of business unless such
Borrower (a) shall have obtained the prior written consent of Administrative Agent to such change,
and (b) shall have taken all actions necessary or requested by Administrative Agent to file or
amend any financing statement or continuation statement to assure perfection and continuation of
perfection of security interests under the Loan Documents. Each Borrower and each general partner
or managing member of each Borrower, as the case may be, shall maintain its separateness as an
entity, including maintaining separate books, records, and accounts and observing corporate and
partnership formalities independent of any other entity, shall pay its obligations with its own
funds and shall not commingle funds or assets with those of any other entity.

9.7 Affiliate Transactions. Without the prior written consent of Administrative Agent, no
Borrower shall engage in any transaction affecting the Project with any Affiliate of any

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Borrower.
Administrative Agent hereby approves transactions entered into as of the date hereof among
Borrowers and Managers, with regard to management and maintenance of the Projects.

9.8 Limitation on Other Debt. Each Borrower (and each general partner and managing member
in each Borrower, if any) shall not, without the prior written consent of Administrative Agent and
the Majority Lenders,
incur any Debt other than the Loans and customary trade payables that are payable, and shall be
paid, within thirty (30) days of when incurred.

9.9 Further Assurances. Borrowers shall promptly (1) cure any defects in the execution and
delivery of the Loan Documents, and (2) execute and deliver, or cause to be executed and delivered,
all such other documents, agreements and instruments as Administrative Agent may reasonably request
to further evidence and more fully describe the collateral for the Loans, to correct any omissions
in the Loan Documents, to perfect, protect or preserve any liens created under any of the Loan
Documents, or to make any recordings, file any notices, or obtain any consents, as may be necessary
or appropriate in connection therewith. Borrowers grant Administrative Agent (on behalf of the
Lenders) an irrevocable power of attorney coupled with an interest for the purpose of exercising
and perfecting any and all rights and remedies available to Administrative Agent and the Lenders
under the Loan Documents and the Hazardous Materials Indemnity Agreement, at law and in equity,
including without limitation such rights and remedies available to Administrative Agent and the
Lenders pursuant to this Section 9.9.

9.10 Estoppel Certificates. Borrowers, within ten (10) days after request, shall furnish
to Administrative Agent a written statement, duly acknowledged, setting forth the amount due on the
Loans, the terms of payment of the Loans, the date to which interest has been paid, whether any
offsets or defenses exist against the Loans and, if any are alleged to exist, the nature thereof in
detail, and such other matters as Administrative Agent reasonably may request.

9.11 Notice of Certain Events. Borrowers shall promptly notify Administrative Agent of
any: (1) Potential Default or Event of Default, together with a detailed statement of the steps
being taken to cure such Potential Default or Event of Default; (2) notice of default received by
any Borrower under other obligations relating to any Project or otherwise material to any
Borrower’s business; and (3) threatened or pending legal, judicial or regulatory proceedings,
including any dispute between any Borrower and any governmental authority, affecting any Borrower
or any Project.

9.12 Indemnification. Borrowers shall jointly and severally protect, indemnify, defend and
hold Administrative Agent and each Lender harmless from and against any and all losses,
liabilities, claims, damages, expenses, obligations, penalties, actions, judgments, suits, costs or
disbursements of any kind or nature whatsoever, including the reasonable fees and actual expenses
of Administrative Agent’s and/or any Lender’s counsel, in connection with (1) ownership of the
Mortgages, the Projects or any interest therein or receipt of any rents; (2) any accident, injury
to or death of persons or loss of or damage to property occurring in, on or about the Projects or
any part thereof or on the adjoining sidewalks, curbs, adjacent property or adjacent parking areas,
streets or ways; (3) any use, nonuse or condition in, on or about the Projects or any part thereof
or on the adjoining sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways;
(4) performance of any labor or services or the furnishing of any materials or other property in
respect of the
Projects or any part thereof; (5) the failure of any Person to file timely with the Internal
Revenue Service an accurate Form 1099-B, Statement for

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Recipients of Proceeds from Real Estate,
Broker and Barter Exchange Transactions, which may be required in connection with this Agreement,
or to supply a copy thereof in a timely fashion to the recipient of the proceeds of the transaction
in connection with which this Agreement is made; (6) any inspection, review or testing of or with
respect to the Projects; (7) any investigative, administrative, mediation, arbitration, or judicial
proceeding, whether or not Administrative Agent or any Lender is designated a party thereto,
commenced or threatened at any time (including after the repayment of the Loans) in any way related
to the execution, delivery or performance of any Loan Document or to the Projects; (8) any
proceeding instituted by any Person claiming a Lien; (9) any brokerage commissions or finder’s fees
claimed by any broker or other party in connection with the Loans, the Projects, or any of the
transactions contemplated in the Loan Documents, except those arising from brokers with whom
Administrative Agent has dealt and with whom no Borrower has had communication; and (10) any
failure by any Borrower to comply with any of its obligations, agreements, or covenants, in this
Loan Agreement or any misrepresentation made by such Borrower hereunder. Any amounts payable to
Administrative Agent and/or any Lender by reason of the application of this section shall become
immediately due and payable and shall bear interest at the Default Rate from the date loss or
damage is sustained by Administrative Agent or any such Lender until paid.

9.13 Payment for Labor and Materials. Subject to each Borrower’s right to contest in
accordance with Section 12.26 hereof, each Borrower will promptly pay when due all bills
and costs for labor, materials, and specifically fabricated materials incurred in connection with
its Project(s) and never permit to exist beyond the due date thereof in respect of its Project(s)
or any part thereof any Lien, even though inferior to the Liens hereof, and in any event never
permit to be created or exist in respect of its Project(s) or any part thereof any other or
additional Lien other than the Liens hereof, except for the Permitted Encumbrances (defined in the
applicable Mortgage).

9.14 Immediate Repairs and Capital Improvements. Borrowers acknowledge that on or prior to
the date hereof, Administrative Agent has caused the Projects to be inspected and such inspection
has revealed that the Projects are in need of the Required Repairs as more particularly described
on Schedule 9.14 attached hereto. Each Borrower shall cause (or shall use commercially
reasonable diligent efforts to cause the tenant under the applicable Lease to cause) the Required
Repairs to be completed, performed, remediated and corrected to the satisfaction of Administrative
Agent and as necessary to bring its Project(s) into compliance with all applicable laws,
ordinances, rules and regulations on or before the first anniversary of the date hereof.

9.15 Contribution Agreement. Borrowers shall comply in all respects with the terms of the
Contribution Agreement. Borrowers shall not modify or amend the Contribution Agreement without the
prior written consent of the Administrative Agent, which consent shall not be unreasonably
withheld.

9.16 Interest Rate Protection Agreement9.16.1 . With respect to the Note C Loans,
Administrative Agent shall have the right at any time during the Term to require Borrowers to
procure and thereafter maintain in full force and effect, at Borrower’s sole cost and expense, an
interest rate protection agreement that (a) is with a financial institution having a long term
unsecured debt rating of at least “AA+” by S&P and the equivalent ratings by Moody’s
(“Counterparty”); (b) has at least an initial one-year term; (c) is an interest rate cap in
respect of a notional amount

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not less than the outstanding principal amount of the Note C Loans
that shall have the effect of capping the LIBOR-based Rate at an interest rate that would cause the
Debt Service Coverage to be equal or greater than 1.05 to 1; (d) shall not be secured by any
Project or any pledge of the membership interests in any Borrower; and (e) is otherwise in a form
acceptable to Administrative Agent (an “Interest Rate Protection Agreement”). Upon the
expiration of the initial term, the Interest Rate Protection Agreement shall be renewed or amended
on an annual basis (or Borrowers shall have entered into a new interest rate protection agreement),
as necessary, (1) to increase or decrease the notional amount to reflect the then current aggregate
outstanding principal balance of the Note C Loans, (2) to have the effect of capping the
LIBOR-based Rate at an interest rate that would cause the Debt Service Coverage to be equal or
greater than 1.05 to 1, (3) to have a term of at least one year and (4) is otherwise in form and
substance acceptable to Administrative Agent. In the event of that a Counterparty’s long term
unsecured debt rating falls below “AA” as determined by S&P and the equivalent ratings by Moody’s,
Borrower shall replace the Interest Rate Protection Agreement with a replacement Interest Rate
Protection Agreement meeting the requirements of this Section 9.16 not later than ten (10)
Business Days after learning of such downgrade, withdrawal or qualification. In the event that the
Interest Rate Protection Agreement is terminated for any reason or is otherwise unenforceable by
Borrowers, Borrowers shall promptly obtain from a financial institution reasonably satisfactory to
Administrative Agent a replacement interest rate protection agreement in form and substance similar
to the Interest Rate Protection Agreement. Borrowers shall pledge to Administrative Agent (on
behalf of the Lenders) all right, title and interest of Borrowers in and to all payments owing to
or received by Borrowers under the Interest Rate Protection Agreement (and any replacement interest
rate protection agreement) as additional collateral for the Loans and deliver to Administrative
Agent a favorable legal opinion with respect to the enforceability of such pledge against Borrowers
thereunder. Borrowers shall execute and deliver, and shall cause the counterparty under the
applicable Interest Rate Protection Agreement to execute and deliver, to Administrative Agent (on
behalf of the Lenders) an Interest Rate Protection Pledge within fifteen (15) days following the
Closing Date.

9.17 Post-Closing Obligations. Borrowers shall perform and complete all obligations set
forth on Schedule 9.17 attached hereto within the time frames set forth therein to the
satisfaction of Administrative Agent. Failure of Borrowers to perform any of the obligations
within the time frames set forth on Schedule 9.17 shall be an immediate Event of Default.

10. EVENTS OF DEFAULT

Each of the following shall constitute an “Event of Default” under the Loans:

10.1 Payments. Any Borrower’s failure to pay any regularly scheduled installment of principal, interest or
other amount due under the Loan Documents within five (5) days after the date when due, or any
Borrower’s failure to pay the Loans at the Maturity Date, whether by acceleration or otherwise.

10.2 Insurance. Any Borrower’s failure to maintain insurance as required under Section
4.1.

10.3 Sale, Encumbrance, Etc. The sale, transfer, conveyance, pledge, mortgage or
assignment of any part or all of the Projects, or any interest therein, or of any interest in any
Borrower, in violation of Section 9.1.

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10.4 Covenants. Any Borrower’s failure to perform or observe any of the agreements and
covenants contained in this Agreement or in any of the other Loan Documents (other than payments
under Section 10.1, insurance requirements under Section 10.2, and transfers and
encumbrances under Section 10.3), and the continuance of such failure for twenty (20) days
after notice by Administrative Agent to such Borrower; however, subject to any shorter period for
curing any failure by such Borrower as specified in any of the other Loan Documents, such Borrower
shall have an additional sixty (60) days to cure such failure if (1) such failure does not involve
the failure to make payments on a monetary obligation; (2) such failure cannot reasonably be cured
within twenty (20) days; (3) such Borrower is diligently undertaking to cure such default, and (4)
such Borrower has provided Administrative Agent with security reasonably satisfactory to
Administrative Agent against any interruption of payment or impairment of collateral as a result of
such continuing failure. The notice and cure provisions of this Section 10.4 do not apply
to the Events of Default described in Sections 10.5, 10.6, 10.7, and
10.8 and 10.10.

10.5 Representations and Warranties. Any representation or warranty made in any Loan
Document proves to be untrue in any material respect when made or deemed made, not cured within any
applicable race or cure period therein.

10.6 Other Encumbrances. Any default under any document or instrument, other than the Loan
Documents, evidencing or creating a Lien on the any Project or any part thereof.

10.7 Involuntary Bankruptcy or Other Proceeding. Commencement of an involuntary case or
other proceeding against any Borrower, any Borrower Party or any other Person having an ownership
or security interest in any Project (each, a “Bankruptcy Party”) that seeks liquidation,
reorganization or other relief with respect to it or its debts or other liabilities under any
bankruptcy, insolvency or other similar law now or hereafter in effect or seeks the appointment of
a trustee, receiver, liquidator, custodian or other similar official of it or any of its property,
and such involuntary case or other proceeding shall remain undismissed or unstayed for a period of
sixty (60) days; or an order for
relief against a Bankruptcy Party shall be entered in any such case under the Federal Bankruptcy
Code.

10.8 Voluntary Petitions, etc. Commencement by a Bankruptcy Party of a voluntary case or
other proceeding seeking liquidation, reorganization or other relief with respect to itself or its
Debts or other liabilities under any bankruptcy, insolvency or other similar law or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar official for it or any
of its property, or consent by a Bankruptcy Party to any such relief or to the appointment of or
taking possession by any such official in an involuntary case or other proceeding commenced against
it, or the making by a Bankruptcy Party of a general assignment for the benefit of creditors, or
the failure by a Bankruptcy Party, or the admission by a Bankruptcy Party in writing of its
inability, to pay its debts generally as they become due, or any action by a Bankruptcy Party to
authorize or effect any of the foregoing;

10.9 Reserved.

11. REMEDIES

11.1 Remedies — Insolvency Events. Upon the occurrence of any Event of Default described
in Section 10.7 or 10.8, the obligations of the Lenders to advance amounts
hereunder shall

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immediately terminate, and all amounts due under the Loan Documents immediately
shall become due and payable, all without written notice and without presentment, demand, protest,
notice of protest or dishonor, notice of intent to accelerate the maturity thereof, notice of
acceleration of the maturity thereof, or any other notice of default of any kind, all of which are
hereby expressly waived by Borrowers; however, if the Bankruptcy Party under Section 10.7
or 10.8 is other than a Borrower, then all amounts due under the Loan Documents shall
become immediately due and payable at Administrative Agent’s election, in Administrative Agent’s
sole discretion.

11.2 Remedies — Other Events. Except as set forth in Section 11.1 above, while any
Event of Default exists, Administrative Agent may (1) by written notice to Borrowers, declare the
entire amount of the Loans to be immediately due and payable without presentment, demand, protest,
notice of protest or dishonor, notice of intent to accelerate the maturity thereof, notice of
acceleration of the maturity thereof, or other notice of default of any kind, all of which are
hereby expressly waived by Borrowers, (2) terminate the obligation, if any, of Administrative Agent
to advance amounts hereunder, and (3) exercise all rights and remedies therefor under the Loan
Documents with respect to any collateral given as security for the Loans and at law or in equity.

11.3 Administrative Agent’s Right to Perform the Obligations. If any Borrower shall fail,
refuse or neglect to make any payment or perform any act required by the Loan Documents, then while
any Event of Default exists, and without notice to or demand
upon Borrowers and without waiving or releasing any other right, remedy or recourse Administrative
Agent may have because of such Event of Default, Administrative Agent or any Lender may (but shall
not be obligated to) make such payment or perform such act for the account of and at the expense of
Borrowers, and shall have the right to enter upon all or any of the Projects for such purpose and
to take all such action thereon and with respect to such Projects as it may deem necessary or
appropriate. If Administrative Agent shall elect to pay any sum due with reference to any Project,
Administrative Agent may do so in reliance on any bill, statement or assessment procured from the
appropriate governmental authority or other issuer thereof without inquiring into the accuracy or
validity thereof. Similarly, in making any payments to protect the security intended to be created
by the Loan Documents, Administrative Agent shall not be bound to inquire into the validity of any
apparent or threatened adverse title, lien, encumbrance, claim or charge before making an advance
for the purpose of preventing or removing the same. Additionally, if any Hazardous Materials
affect or threaten to affect any Project, Administrative Agent may (but shall not be obligated to)
give such notices and take such actions as it deems necessary or advisable in order to abate the
discharge of any Hazardous Materials or remove the Hazardous Materials. Borrowers shall jointly
and severally indemnify Administrative Agent and the Lenders for all losses, expenses, damages,
claims and causes of action, including reasonable attorneys’ fees, incurred or accruing by reason
of any acts performed by Administrative Agent or any Lender pursuant to the provisions of this
Section 11.3, including those arising from the joint, concurrent, or comparative negligence
of Administrative Agent and any Lender, except as a result of Administrative Agent’s or any
Lender’s gross negligence or willful misconduct. All sums paid by Administrative Agent or any
Lender pursuant to this Section 11.3, and all other sums expended by Administrative Agent
or any Lender to which it shall be entitled to be indemnified, together with interest thereon at
the Default Rate from the date of such payment or expenditure until paid, shall constitute
additions to the Loans, shall be secured by the Loan Documents and shall be paid by Borrowers to
Administrative Agent upon demand. In the event that

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Administrative Agent (with the approval of the Majority
Lenders) exercises its right to foreclose on any security for the Loans, the applicable Borrower
and Tarragon shall cooperate with Administrative Agent in connection with any filings or the
fulfillment of any other obligations arising under local residential housing legal requirements.

11.4 Cross-Default; Cross-Collateralization; Waiver of Marshalling of Assets.

     11.4.1 Borrowers acknowledge that the Lenders have made the Loans to the Borrowers upon the
security of its collective interest in the Projects and in reliance upon the aggregate of the
Projects taken together being of greater value as collateral security than the sum of the Projects
taken separately. Borrowers agree that the Mortgages are and will be cross-collateralized and
cross-defaulted with each other so that (a) an Event of Default under any of the Mortgages shall
constitute an Event of Default under this Agreement and each of the other Mortgages; and (b) an
Event of Default under any of the Notes or this Agreement shall constitute an Event of Default
under all of the Notes and each Mortgage.

     11.4.2 To the fullest extent permitted by law, each Borrower, for itself and its successors
and assigns, waives all rights to a marshalling of the assets of Borrowers, and others with
interests in any Borrower, and of the Projects, or to a sale in inverse order of alienation in the
event of foreclosure of all or any of the Mortgages, and agrees not to assert any right under any
laws pertaining to the marshalling of assets, the sale in inverse order of alienation, homestead
exemption, the administration of estates of decedents, or any other matters whatsoever to defeat,
reduce or affect the right of Administrative Agent (on behalf of the Lenders) under the Loan
Documents to a sale of the Projects for the collection of the Loans without any prior or different
resort for collection or of the right of Administrative Agent to the payment of the Loans (on
behalf of the Lenders) out of the net proceeds of the Projects in preference to every other
claimant whatsoever. In addition, each Borrower, for itself and its successors and assigns, waives
in the event of foreclosure of any or all of the Mortgages, any equitable right otherwise available
to the Borrowers which would require the separate sale of the Projects or require Administrative
Agent to exhaust its remedies against any Project or any combination of the Projects before
proceeding against any other Project or combination of Projects; and further in the event of such
foreclosure each Borrower hereby expressly consents to and authorizes, at the option of
Administrative Agent, the foreclosure and sale either separately or together of any combination of
the Projects.

12. MISCELLANEOUS

12.1 Notices. Any notice required or permitted to be given under this Agreement shall be
in writing and either shall be mailed by certified mail, postage prepaid, return receipt requested,
or sent by overnight air courier service, or personally delivered to a representative of the
receiving party, or sent by telecopy (provided an identical notice is also sent simultaneously by
mail, overnight courier, or personal delivery as otherwise provided in this Section 12.1).
All such communications shall be mailed, sent or delivered, addressed to the party for whom it is
intended at its address set forth below.

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	If to Borrower:

	 	c/o Tarragon Corporation
	 

	 	1775 Broadway, 23rd Floor
	 

	 	New York, NY 10019
	 

	 	Attn: Todd C. Minor
	 

	 	Fax: (212) 949-8001

	 	 	 
	with a copy to:

	 	Tarragon Corporation
	 

	 	3100 Monticello, Suite 200
	 

	 	Dallas, TX 75205
	 

	 	Attn: Kathryn Mansfield, Esq.
	 

	 	Telecopy: (214) 599-2250

	 	 	 
	If to Administrative Agent:

	 	General Electric Capital Corporation
	 

	 	125 Park Avenue
	 

	 	New York, NY 10017-5529
	 

	 	Attn: Asset Manager, Project Tarragon
	 

	 	Telecopy: (212) 573-9733

	 	 	 
	with a copy to:

	 	Morrison & Foerster LLP
	 

	 	555 W. Fifth Street, Suite 3500
	 

	 	Los Angeles, CA 90013-1024
	 

	 	Attn: Marc D. Young, Esq.
	 

	 	Telecopy: (213) 892-5454

Any communication so addressed and mailed shall be deemed to be given on the earliest of (1) when
actually delivered, (2) on the first Business Day after deposit with an overnight air courier
service, or (3) on the third Business Day after deposit in the United States mail, postage prepaid,
in each case to the address of the intended addressee (except as otherwise provided in the
Mortgages), and any communication so delivered in person shall be deemed to be given when receipted
for by, or actually received by Administrative Agent, a Lender or Borrowers, as the case may be.
If given by telecopy, a notice shall be deemed given and received when the telecopy is transmitted
to the party’s telecopy number specified above, and confirmation of complete receipt is received by
the transmitting party during normal business hours or on the next Business Day if not confirmed
during normal business hours, and an identical notice is also sent simultaneously by mail,
overnight courier, or personal delivery as otherwise provided in this Section 12.1. Either
party may designate a change of address by written notice to the other by giving at least ten (10)
days’ prior written notice of such change of address.

12.2 Amendments and Waivers. No amendment or waiver of any provision of the Loan Documents
shall be effective unless in writing and signed by the party against whom enforcement is sought.

12.3 Limitation on Interest. It is the intention of the parties hereto to conform strictly
to applicable usury laws. Accordingly, all agreements between Borrowers, Administrative Agent and
the Lenders with respect to the Loans are hereby expressly limited so that in no event, whether by
reason of acceleration of maturity or otherwise, shall the amount paid or agreed to be

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paid to
Administrative Agent or any Lenders or charged by any Lender for the use, forbearance or detention
of the money to be lent hereunder or otherwise, exceed the maximum amount allowed by law. If the
Loans would be usurious under applicable law (including the laws of the State and the laws of the
United States of America), then, notwithstanding anything to the contrary in the Loan Documents:
(1) the aggregate of all consideration that constitutes interest under applicable law that is
contracted for, taken, reserved, charged or received under the Loan Documents shall under no
circumstances exceed the maximum amount of interest allowed by applicable law, and any excess shall
be credited on the Notes by the holder thereof (or, if the Notes have been paid in full, refunded
to Borrowers); and (2) if maturity is accelerated by reason of an election by Administrative Agent,
or in the event of any prepayment, then any consideration that constitutes interest may never
include more than the maximum amount allowed by applicable law. In such case, excess interest, if
any, provided for in the Loan Documents or otherwise, to the extent permitted by applicable law,
shall be amortized, prorated, allocated and spread from the date of advance until payment in full
so that the actual rate of interest is uniform through the term hereof. If such amortization,
proration, allocation and spreading is not permitted under applicable law, then such excess
interest shall be cancelled automatically as of the date of such acceleration or prepayment and, if
theretofore paid, shall be credited on the Notes (or, if the Notes have been paid in full, refunded
to Borrowers). The terms and provisions of this Section 12.3 shall control and supersede
every other provision of the Loan Documents. The Loan Documents are contracts made under and shall
be construed in accordance with and governed by the laws of the State of New York (except to the
extent otherwise provided in another Loan Document), except that if at any time the laws of the
United States of America permit the Lenders to contract for, take, reserve, charge or receive a
higher rate of interest than is allowed by the laws of the State of New York (whether such federal
laws directly so provide or refer to the law of any state), then such federal laws shall to such
extent govern as to the rate of interest that the Lenders may contract for, take, reserve, charge
or receive under the Loan Documents.

12.4 Invalid Provisions. If any provision of any Loan Document is held to be illegal,
invalid or unenforceable, such provision shall be fully severable; the Loan Documents shall be
construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a
part thereof; the remaining provisions thereof shall remain in full effect and shall not be
affected by the illegal, invalid, or unenforceable provision or by its severance therefrom; and in
lieu of such illegal, invalid or unenforceable provision there shall be added automatically as a
part of such Loan Document a provision as similar in terms to such illegal, invalid or
unenforceable provision as may be possible to be legal, valid and enforceable.

12.5 Reimbursement of Expenses. Borrowers shall pay or reimburse Administrative Agent
and/or the Lenders on demand of the applicable party for: (1) all reasonable expenses incurred by
Administrative Agent in connection with the Loans, including fees and expenses of Administrative
Agent’s attorneys, environmental, engineering and other consultants, and fees, charges or taxes for
the negotiation, recording or filing of Loan Documents, (2) all expenses of Administrative Agent in
connection with the administration of the Loans, including audit costs, inspection fees and costs,
settlement of condemnation and casualty awards, and premiums for title insurance and endorsements
thereto, and fees and costs for UCC and litigation searches and background checks, and (3)
Administrative Agent and the Lenders for all amounts expended, advanced or incurred by
Administrative Agent and the Lenders to collect the Notes, or to enforce the rights of
Administrative Agent and the Lenders under this Agreement or any other Loan

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Document, or to defend
or assert the rights and claims of Administrative Agent and the Lenders under the Loan Documents or
with respect to any Project (by litigation or other proceedings), which amounts will include all
court costs, attorneys’ fees and expenses, fees of auditors and accountants, and investigation
expenses as may be incurred by Administrative Agent and the Lenders in connection with any such
matters (whether or not litigation is instituted), together with interest at the Default Rate on
each such amount from the date of disbursement until the date of reimbursement to Administrative
Agent and the Lenders, all of which shall constitute part of the Loans and shall be secured by the
Loan Documents.

12.6 Approvals; Third Parties; Conditions. All approval rights retained or exercised by
Administrative Agent and the Lenders with respect to leases, contracts, plans, studies and other
matters are solely to facilitate Administrative Agent’s and the Lenders’ credit underwriting, and
shall not be deemed or construed as a determination that the Lenders have passed on the adequacy
thereof for any other purpose and may not be relied upon by any Borrower or any other Person. This
Agreement is for the sole and exclusive use of Administrative Agent, the Lenders and Borrowers and
may not be enforced, nor relied upon, by any Person other than Administrative Agent, the Lenders
and Borrowers. All conditions of the obligations of Administrative Agent and the Lenders
hereunder, including the obligation to make advances, are imposed solely and exclusively for the
benefit of Administrative Agent and the Lenders, their successors and assigns, and no other Person
shall have standing to require satisfaction of such conditions or be entitled to assume that the
Lenders will refuse to make advances in the absence of strict compliance with any or all of such
conditions, and no other Person shall, under any circumstances, be deemed to be a beneficiary of
such conditions, any and all of which may be freely waived in whole or in part by Administrative
Agent and the Lenders at any time in their sole discretion.

12.7 Administrative Agent Not in Control; No Partnership. None of the covenants or other
provisions contained in this Agreement shall, or shall be deemed to, give Administrative Agent or
any Lender the right or power to exercise control over the affairs or management of any Borrower,
the power of Administrative Agent and the Lenders being limited to the rights to exercise the
remedies referred to in the Loan Documents. The relationship between Borrowers and the Lenders is,
and at all times shall remain, solely that of debtor and creditor. No covenant or provision of the
Loan Documents is intended, nor shall it be deemed or construed, to create a partnership, joint
venture, agency or common interest in profits or income between Administrative Agent, the Lenders
and Borrowers or to create an equity in any Project in Administrative Agents or any Lender.
Administrative Agents and the Lenders neither undertake nor assume any responsibility or duty to
Borrowers or to any other person with respect to the Projects or the Loans, except as expressly
provided in the Loan Documents; and notwithstanding any other provision of the Loan Documents: (1)
neither Administrative Agent nor any Lender is, nor shall be construed as, a partner, joint
venturer, alter ego, manager, controlling person or other business associate or participant of any
kind of any Borrower or its stockholders, members, or partners and neither Administrative Agent nor
any Lender intends to ever assume such status; (2) neither Administrative Agent nor any Lenders
shall be liable for any Debts, expenses or losses incurred or sustained by any Borrower; and (3)
neither Administrative Agent nor any Lender shall be deemed responsible for or a participant in any
acts, omissions or decisions of any Borrower or its stockholders, members, or partners.
Administrative Agent, the Lenders and Borrowers disclaim any intention to create any partnership,
joint venture, agency or common interest in profits or income between Administrative Agent, the
Lenders and Borrowers, or to

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create any equity in any Project in Administrative Agent or any
Lender, or any sharing of liabilities, losses, costs or expenses.

12.8 Time of the Essence. Time is of the essence with respect to this Agreement.

12.9 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit
of Administrative Agent, the Lenders and Borrowers and the respective successors and assigns of
Administrative Agent, the Lenders and Borrowers, provided that neither any Borrower nor any other
Borrower Party shall, without the prior written consent of Administrative Agent, assign any rights,
duties or obligations hereunder.

12.10 Secondary Market Transaction. Borrowers acknowledge that Administrative Agent and
each Lender and its respective successors and assigns may without notice to or consent from
Borrowers (a) sell this Agreement, the Mortgages, the Notes, the other Loan Documents, and any and
all servicing rights thereto, or any portions thereof, to one or more investors, (b) participate
and/or syndicate the Loans to one or more investors, (c) deposit this Agreement, the Notes and the
other Loan Documents, or any portions thereof, with a trust, which trust may sell certificates to
investors evidencing an ownership interest in the trust assets, or (d) otherwise sell, transfer or
assign the Loans or interests therein in one or more transactions to investors (the transactions
referred to in clauses (a) through (d) are hereinafter each referred to as a “Secondary Market
Transaction”). Borrowers shall reasonably cooperate with Administrative Agent and each Lender
in effecting any such Secondary Market Transaction and shall reasonably cooperate and use all
reasonable efforts to satisfy the market standards to which Administrative Agent and each Lender
customarily adheres or which may be reasonably required by any participant, investor, purchaser or
any Rating Agency involved in any Secondary Market Transaction (including, without limitation,
delivery of opinions of counsel in form and substance similar to the opinions of counsel delivered
to the Administrative Agent on the date hereof) at no third party cost to Borrowers except for
their own legal fees and incidental costs and expenses in connection therewith. Borrowers shall
provide such non-confidential, proprietary information and documents relating to Borrowers and the
Projects as Administrative Agent and each Lender may reasonably request in connection with such
Secondary Market Transaction. In addition, Borrowers shall make available to Administrative Agent
and the Lenders all information concerning the Projects, their business and operations that
Administrative Agent and the Lenders may reasonably request. Administrative Agent and the Lenders
shall be permitted to share all information with the participants, investors, purchasers,
investment banking firms, Rating Agencies, accounting firms, law firms and third-party advisory
firms involved with the Loans and Loan Documents or the applicable Secondary Market Transaction,
subject to the execution of customary confidentiality agreements. Administrative Agent and the
Lenders and all of the aforesaid participants, investors, purchasers, advisors, Rating Agencies and
professional firms shall be entitled to rely on the information supplied by or on behalf of
Borrowers. Borrowers also agree to execute any amendment of or supplement to this Agreement and
the other Loan Documents as Administrative Agent and the Lenders may reasonably request (in a form
reasonably acceptable to Borrowers) in connection with any Secondary Market Transaction, provided
that such amendment or supplement does not change the economic terms of the Loans, or increase
Borrowers’ non-monetary obligations or diminish Borrowers’ rights under this Agreement and the
other Loan Documents, except in a de minimus way.

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     12.10.1 Administrative Agent and each Lender shall have the right, at any time (whether prior
to, in connection with, or after any Secondary Market Transaction), with respect to all or any
portion of the Loan, to modify, split and/or sever all or any portion of the Loan as hereinafter
provided. Without limiting the foregoing, Administrative Agent may (i) cause the Notes and
Mortgages to be split into a first and second mortgage loan, (ii) create one or more senior and
subordinate notes, (iii) create multiple components of the Notes (and allocate or reallocate the
principal balance of the Loans among such components) or (iv) otherwise sever membership interests
(directly or indirectly) in Borrowers (i.e., a senior loan/mezzanine loan structure), in each such
case, in whatever proportion and whatever priority Administrative Agent determines; provided,
however, in each such instance the outstanding principal balance of all the Notes evidencing the
Loans (or components of such Notes) immediately after the effective date of such modification
equals the outstanding principal balance of the Loans immediately prior to such modification and
the weighted average of the interest rates for all such Notes (or components of such Notes)
immediately after the effective date of such modification equals the interest rate of the original
Notes immediately prior to such modification. If requested by Administrative Agent, Borrowers (and
Borrowers’ constituent members, if applicable) shall execute within ten (10) days after such
request, such documentation as Lender may reasonably request to evidence and/or effectuate any such
modification or severance.

12.11 Evidence of Indebtedness. The Notes may hereafter be split, severed and subdivided,
by exchange for promissory notes of lesser denominations or otherwise, and, in such event,
Borrowers shall promptly execute additional or replacement Notes. At no time shall the aggregate
original principal amount of such replacement Notes exceed the maximum principal balance of the
loan outstanding plus the amount of any Additional Advances which may be available hereunder as of
the date of execution of such replacement Notes.

12.12 Renewal, Extension or Rearrangement. All provisions of the Loan Documents shall
apply with equal effect to each and all promissory notes and amendments thereof hereinafter
executed that in whole or in part represent a renewal, extension, increase or rearrangement of the
Loans.

12.13 Waivers. No course of dealing on the part of Administrative Agent or any Lender,
their officers, employees, consultants or agents, nor any failure or delay by Administrative Agent
or any Lender with respect to exercising any right, power or privilege of Administrative Agent or
any Lender under any of the Loan Documents, shall operate as a waiver thereof.

12.14 Cumulative Rights. Rights and remedies of Administrative Agent and the Lenders under
the Loan Documents shall be cumulative, and the exercise or partial exercise of any such right or
remedy shall not preclude the exercise of any other right or remedy.

12.15 Singular and Plural. Words used in this Agreement and the other Loan Documents in
the singular, where the context so permits, shall be deemed to include the plural and vice versa.
The definitions of words in the singular in this Agreement and the other Loan Documents shall apply
to such words when used in the plural where the context so permits and vice versa.

12.16 Phrases. When used in this Agreement and the other Loan Documents, the phrase
“including” shall mean “including, but not limited to,” the phrases “satisfactory to any Lender” or
“satisfactory to Administrative Agent” shall mean in form and substance satisfactory to such

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Lender
or Administrative Agent, as the case may be, in all respects, the phrases “with Lender’s consent”,
“with Lender’s approval”, “with Administrative Agent’s consent” or “with Administrative Agent’s
approval” shall mean such consent or approval at Lender’s or Administrative Agent’s, as the case
may be, discretion, and the phrases “acceptable to Lender” or “acceptable to Administrative Agent”
shall mean acceptable to Lender or Administrative Agent, as the case may be, at such party’s sole
discretion.”

12.17 Exhibits and Schedules. The exhibits and schedules attached to this Agreement are
incorporated herein and shall be considered a part of this Agreement for the purposes stated
herein.

12.18 Titles of Articles, Sections and Subsections. All titles or headings to articles,
sections, subsections or other divisions of this Agreement and the other Loan Documents or the
exhibits hereto and thereto are only for the convenience of the parties and shall not be construed
to have any effect or meaning with respect to the other content of such articles, sections,
subsections or other divisions, such other content being controlling as to the agreement between
the parties hereto.

12.19 Promotional Material. Each Borrower authorizes Administrative Agent and each of the
Lenders to issue press releases, advertisements and other promotional materials in connection with
Administrative Agent’s or such Lender’s own promotional and marketing activities, and describing
the Loans in general terms or in detail and Administrative Agent’s or such Lender’s participation
in the Loans. All references to Administrative Agent or any Lender contained in any press release,
advertisement or promotional material issued by any Borrower shall be approved in writing by
Administrative Agent and such Lender in advance of issuance.

12.20 Survival. All of the representations, warranties, covenants, and indemnities
hereunder (including environmental matters under Article 4), and under the indemnification
provisions of the other Loan Documents, shall survive the repayment in full of the Loans and the
release of the liens evidencing or securing the Loans, and shall survive the transfer (by sale,
foreclosure, conveyance in lieu of foreclosure or otherwise) of any or all right, title and
interest in and to any of the Projects to any party, whether or not an Affiliate of any Borrower.

12.21 Waiver of Jury Trial. TO THE MAXIMUM EXTENT PERMITTED BY LAW, BORROWERS,
ADMINISTRATIVE AGENT AND EACH LENDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE
RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENT (WHETHER VERBAL OR WRITTEN) OR ACTION OF EITHER PARTY OR ANY EXERCISE BY ANY
PARTY OF THEIR RESPECTIVE RIGHTS UNDER THE LOAN DOCUMENTS OR IN ANY WAY RELATING TO THE LOAN OR ANY
PROJECT (INCLUDING, WITHOUT LIMITATION, ANY ACTION TO RESCIND OR CANCEL THIS AGREEMENT, AND ANY
CLAIM OR DEFENSE ASSERTING THAT THIS AGREEMENT WAS FRAUDULENTLY INDUCED OR IS OTHERWISE VOID OR
VOIDABLE). THIS WAIVER IS A MATERIAL INDUCEMENT FOR ADMINISTRATIVE AGENT AND EACH LENDER TO ENTER
THIS AGREEMENT.

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12.22 Waiver of Punitive or Consequential Damages. None of Administrative Agent, the
Lenders or Borrowers shall be responsible or liable to the other or to any other Person for any
punitive, exemplary or consequential damages that may be alleged as a result of the Loans or the
transaction contemplated hereby, including any breach or other default by any party hereto.

12.23 Governing Law; Jurisdiction and Venue12.23.1 .

     12.23.1 THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK, AND MADE BY THE ADMINISTRATIVE
AGENT AND LENDERS AND ACCEPTED BY BORROWERS IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THE NOTES
DELIVERED PURSUANT HERETO WERE DISBURSED FROM THE STATE OF NEW YORK, WHICH STATE THE PARTIES AGREE
HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY,
AND IN ALL RESPECTS, INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND PERFORMED IN SUCH STATE AND ANY APPLICABLE LAW OF THE UNITED STATES OF AMERICA,
EXCEPT THAT AT ALL TIMES THE PROVISIONS FOR THE CREATION, PERFECTION, AND ENFORCEMENT OF THE LIENS
AND SECURITY INTERESTS CREATED PURSUANT HERETO AND PURSUANT TO THE OTHER LOAN DOCUMENTS SHALL BE
GOVERNED BY AND CONSTRUED ACCORDING TO THE LAW OF THE STATE IN WHICH THE PROJECT IS LOCATED, IT
BEING UNDERSTOOD THAT, TO THE FULLEST EXTENT PERMITTED BY THE LAW OF SUCH STATE, THE LAW OF THE
STATE OF NEW YORK SHALL GOVERN THE CONSTRUCTION, VALIDITY AND ENFORCEABILITY OF ALL LOAN DOCUMENTS
AND ALL OF THE OBLIGATIONS ARISING HEREUNDER OR THEREUNDER. TO THE FULLEST EXTENT PERMITTED BY
LAW, EACH OF BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER HEREBY UNCONDITIONALLY AND
IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY OTHER JURISDICTION GOVERNS THIS
AGREEMENT AND THE NOTES, AND THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATIONS LAW.

     12.23.2 ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER OR
ANY BORROWER ARISING OUT OF OR RELATING TO THE LOAN DOCUMENTS MAY AT THE ADMINISTRATIVE AGENT’S
OPTION BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF NEW YORK, COUNTY OF NEW YORK,
PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND EACH BORROWER WAIVES ANY
OBJECTIONS WHICH IT THEY MAY NOW OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM NON CONVENIENS OF
ANY SUCH SUIT, ACTION OR PROCEEDING, AND EACH OF ADMINISTRATIVE AGENT, LENDERS AND BORROWERS HEREBY
IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING. EACH
BORROWER DOES HEREBY DESIGNATE AND APPOINT WILLIAM S. FRIEDMAN, HAVING AN ADDRESS AT C/O TARRAGON

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CORPORATION, 1775 BROADWAY, 23RD FLOOR, NEW YORK, NEW YORK 10019, AS ITS AUTHORIZED
AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY AND ALL PROCESS WHICH MAY BE SERVED IN
ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES
THAT SERVICE OF PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID SERVICE MAILED
OR DELIVERED TO SUCH BORROWER IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY RESPECT
EFFECTIVE SERVICE OF PROCESS UPON SUCH BORROWER, IN ANY SUCH SUIT, ACTION OR PROCEEDING IN THE
STATE OF NEW YORK. BORROWERS (A) SHALL GIVE PROMPT NOTICE TO THE ADMINISTRATIVE AGENT OF ANY
CHANGED ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (B) MAY AT ANY TIME AND FROM TIME TO TIME
DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW YORK (WHICH SUBSTITUTE
AGENT AND OFFICE SHALL BE DESIGNATED AS THE PERSON AND ADDRESS FOR SERVICE OF PROCESS), AND (C)
SHALL PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS AUTHORIZED AGENT CEASES TO HAVE AN OFFICE IN NEW
YORK, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A SUCCESSOR.

12.24 Entire Agreement. This Agreement and the other Loan Documents embody the entire
agreement and understanding between Administrative Agent, the Lenders and Borrowers and supersede
all prior agreements and understandings between such parties relating to the subject matter hereof
and thereof. Accordingly, the Loan Documents may not be contradicted by evidence of prior,
contemporaneous, or subsequent oral agreements of the parties. There are no unwritten oral
agreements between the parties. If any conflict or inconsistency exists between any prior
agreement or understanding between Administrative Agents, the Lenders and Borrowers and this
Agreement or any of the other Loan Documents, the terms of this Agreement and the other Loan
Documents shall control.

12.25 Counterparts. This Agreement may be executed in multiple counterparts, each of which
shall constitute an original, but all of which shall constitute one document.

12.26 Contest of Certain Claims. Any Borrower may contest the validity of Taxes or any
mechanic’s or materialman’s lien asserted against its Project(s) so long as (1) such Borrower
notifies Administrative Agent that it intends to contest such Taxes or liens, as applicable, (2)
such Borrower provides Administrative Agent with an indemnity, bond or other security reasonably
satisfactory to Administrative Agent assuring the discharge of such Borrower’s obligations for such
Taxes or liens, as applicable, including interest and penalties, (3) such Borrower is diligently
contesting the same by appropriate legal proceedings in good faith and at its own expense and
concludes such contest prior to the tenth (10th) day preceding the earlier to occur of the Maturity
Date or the date on which its Project(s) is scheduled to be sold for non-payment, (4) such Borrower
promptly upon final determination thereof pays the amount of any such Taxes or liens, as
applicable, together with all costs, interest and penalties which may be payable in connection
therewith, and (5) notwithstanding the foregoing, such Borrower shall immediately upon request of
Administrative Agent pay any such Taxes or liens, as applicable, notwithstanding such contest if,
in the opinion of Administrative Agent, its Project(s) or any part thereof or interest therein may
be in danger of being sold, forfeited, foreclosed, terminated, canceled or lost. Administrative
Agent may pay over any cash deposit or part thereof to the

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claimant entitled thereto at any time
when, in the reasonable judgment of Administrative Agent, the entitlement of such claimant is
established.

12.27 Assignments and Participations.

     12.27.1 Assignments by Borrower. No Borrower may assign any of its rights or
obligations hereunder or under the Notes without the prior consent of all of the Lenders and
Administrative Agent.

     12.27.2 Assignments by the Lenders. Each Lender may assign any of its Loans, its Note
and its Commitment (but only with the consent of Administrative Agent) and upon notice Borrowers;
provided that:

     A. no such consent by Administrative Agent shall be required in the case of any
assignment by any Lender to another Lender or an affiliate of such Lender or such other
Lender;

     B. except to the extent Administrative Agent shall otherwise consent, any such partial
assignment (other than to another Lender or an affiliate of a Lender) shall be in an amount
at least equal to $10,000,000;

     C. each such assignment (including an assignment to another Lender or an affiliate of a
Lender) by a Lender of its Loans or Commitment shall be made in such manner so that the same
portion of its Loans and Commitment is assigned to the respective assignee;

     D. subject to the applicable Lender’s compliance with the provisions of clauses (B) and
(C) above, Administrative Agent’s consent to an assignment shall not be unreasonably
withheld, delayed or conditioned if (i) in the reasonable judgment of Administrative Agent,
such assignment is made to a reputable institutional investor with substantial experience in
real estate lending and originating mortgage loans similar to the Loans, and a financial net
worth of at least $100,000,000, (ii) such assignment is first offered to Administrative
Agent in accordance with the terms and conditions of a separate agency agreement among
Administrative Agent and the Lenders, and (iii) the provisions of clause (E) have been
satisfied; and

     E. upon execution and delivery by the assignee (even if already a Lender) to Borrowers
and Administrative Agent of an Assignment and Acceptance pursuant to which such assignee
agrees to become a “Lender” hereunder (if not already a Lender) having the Commitment and
Loans specified in such instrument, and upon consent thereto by Administrative Agent to the
extent required above, the assignee shall have, to the extent of such assignment (unless
otherwise consented to by Administrative Agent), the obligations, rights and benefits of a
Lender hereunder holding the Commitment and Loans (or portions thereof) assigned to it (in
addition to the Commitment and Loans, if any, theretofore held by such assignee) and the
assigning Lender shall, to the extent of such assignment, be released from the Commitment
(or portion thereof) so assigned. Upon each such assignment the assigning Lender shall pay
Administrative Agent a

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processing and recording fee of $3,500 and the reasonable fees and
disbursements of Administrative Agent’s counsel incurred in connection therewith.

     12.27.3 Participations. A Lender may sell or agree to sell to one or more other
Persons (each a “Participant”) a participation in all or any part of any Loans held by it,
or in its Commitment, provided that such Participant shall not have any rights or obligations under
this Agreement or any Note or any other Loan Document (the Participant’s rights against such Lender
in respect of such participation to be those set forth in the agreements executed by such Lender
and the applicable Participant). All amounts payable by Borrowers to any Lender under Section
2.8 in respect of Loans held by it and its Commitment shall be determined as if such Lender had
not sold or agreed to sell any participations in such Loans and Commitment, and as if such Lender
were funding each of such Loans and Commitment in the same way that it is funding the portion of
such Loans and Commitment in which no participations have been sold. In no event shall a Lender
that sells a participation agree with the Participant to take or refrain from taking any action
hereunder or under any other Loan Document except that such Lender may agree with the Participant
that it will not, without the consent of the Participant, agree to (i) increase or extend the term
of such Lender’s Commitment, (ii) extend the date fixed for the payment of principal of or interest
on the related Loan or Loans or any portion of any fee hereunder payable to the Participant, (iii)
reduce the amount of any such payment of principal, (iv) reduce the rate at which interest is
payable thereon, or any fee hereunder payable to the Participant, to a level below the rate at
which the Participant is entitled to receive such interest or fee or (v) consent to any
modification, supplement or waiver hereof or of any of the other Loan Documents to the extent that
the same, under Section 12.2, requires the consent of each Lender.

     12.27.4 Certain Pledges. In addition to the assignments and participations permitted
under the foregoing provisions of this Section 12.27 (but without being subject thereto),
any Lender may (without notice to Borrowers, Administrative Agent or any other Lender and without
payment of any fee) assign and pledge all or any portion of its Loans and its Note to any Federal
Reserve Bank as collateral security pursuant to Regulation A and any operating circular issued by
such Federal Reserve Bank, and such Loans and Note shall be fully transferable as provided therein.
No such assignment shall release the assigning Lender from its obligations hereunder.

     12.27.5 Provision of Information to Assignees and Participants. A Lender may furnish
any information concerning Borrowers or any of their Affiliates in the possession of such Lender
from time to time to assignees and participants (including prospective assignees and participants).

     12.27.6 No Assignments to Borrower or Affiliates. Anything in this Section
12.27 to the contrary notwithstanding, no Lender may assign or participate any interest in any
Loan held by it hereunder to any Borrower or any of its Affiliates without the prior consent of
each Lender.

13. LIMITATIONS ON LIABILITY

13.1 Limitation on Liability. Except as provided below, none of the Borrowers nor Tarragon
shall be personally liable for amounts due under the Loan Documents (except Tarragon shall be
personally liable under the Recourse Guaranties and the Hazardous Materials Indemnity Agreements).
Each Borrower and Tarragon, however, shall be personally liable to Administrative Agent and the
Lenders on a joint and several basis for any deficiency, loss or

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damage suffered by Administrative
Agent or any Lender because of: (1) any Borrower’s or Tarragon’s commission of a criminal act, (2)
the failure to comply with provisions of the Loan Documents prohibiting the sale, transfer or
encumbrance of any Project, any other collateral, or any direct or indirect ownership interest in
any Borrower; (3) the misapplication by any Borrower or any Borrower Party or Tarragon of any funds
derived from any Project, including security deposits, insurance proceeds and condemnation awards
in violation of this Agreement or any of the other Loan Documents; (4) the fraud or
misrepresentation by any Borrower, Tarragon, or any Borrower Party made in or in connection with
the Loan Documents or the Loans; (5) any Borrower’s collection of Rents more than one month in
advance or entering into or modifying leases, or receipt of monies by any Borrower or any Borrower
Party in connection with the modification of any Leases, in violation of this Agreement or any of
the other Loan Documents; (6) any Borrower’s failure to apply proceeds of Rents or any other
payments in respect of the Leases and other income of any Project or any other collateral when
received to the costs of maintenance and operation of any Project and to the payment of taxes, lien
claims, insurance premiums, Debt Service and other amounts due under the Loan Documents to the
extent the Loan Documents require such proceeds to be then so applied; (7) any Borrower’s or
Tarragon’s interference with Administrative Agent’s exercise of rights under the Assignment of
Rents and Leases; (8) any Borrower’s or Tarragon’s failure to timely renew any letter of credit
issued in connection with the Loans; (9) any Borrower’s failure to maintain insurance as required
by this Agreement or to pay any taxes or assessments affecting any Project; (10) damage or
destruction to any Project caused by the acts or omissions of any Borrower, or any Borrower’s
agents, employees, or contractors; (11) any Borrower’s failure to comply with its obligations with
respect to environmental matters under Article 5; (12) any Borrower’s or Tarragon’s failure
to pay for any loss, liability or expense (including attorneys’ fees) incurred by Administrative
Agent or any Lender arising out of any claim or allegation made by any Borrower or Tarragon, their
successors or assigns, or any creditor of such Borrower or Tarragon, that this Agreement or the
transactions contemplated by the Loan Documents establish a joint venture, partnership or other
similar arrangement between any Borrower, Tarragon, Administrative Agent and any Lender; (13) any
brokerage commission or finder’s fees claimed in connection with the transactions contemplated by
the Loan Documents; (14) the filing by any Borrower or Tarragon or any of their members, partners,
or shareholders, or the filing against any of the preceding, of a petition under the United States
Bankruptcy Code or similar state insolvency laws; (15) uninsured damage to any Project resulting
from acts of terrorism; (16) the failure of any Borrower and/or Tarragon after Administrative
Agent’s exercise of any of its remedies pursuant to Article 11 to cooperate with any laws,
rules,
regulation, or ordinances of any governmental authority governing or related to residential
property; (17) the making of any claim by any Borrower, Tarragon, any Borrower Party or any other
person or entity that the transactions contemplated by the Loans constitutes a “Fraudulent
Conveyance” as such term is used in the United States Bankruptcy Code; (18) the failure of
Borrowers to cause Net Cash Flow to be deposited in accordance with Section 3.1; (19) any
losses or damages incurred by Administrative Agent or any Lender to the extent that, in
Administrative Agent’s or such Lender’s reasonable judgment, such losses or damages would not have
been incurred by Administrative Agent or such Lender if Administrative Agent and the Lenders had
fully cross collateralized each of the Loans with respect to each Borrower pursuant to first and
second mortgages from each Borrower in favor of Administrative Agent (on behalf of the Lenders) and
guaranties by each of the Borrowers of all of the other Borrowers’ Loans, which guaranties are
secured by second mortgages on each of the Projects of such guarantor or (20) any damage or loss
suffered by

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Administrative Agent or any Lender at any time as a result of or relating to the
commingling of any of any Borrower’s funds with the funds of any other Borrower or Person
(including, without limitation, Affiliates, partners, and managing members of any Borrower)
including, without limitation, any losses or damages suffered by Administrative Agent or any Lender
by a consolidation or a deemed consolidation of any Borrower with any other Borrower or any other
Person under any bankruptcy or similar law or in connection with any bankruptcy-related purpose or
any other purpose. None of the foregoing limitations on personal liability shall modify, diminish
or discharge the personal liability of any Guarantor. Nothing herein shall be deemed to be a
waiver of any right that Lender may have under Sections 506(a), 506(b),
1111(b) or any other provision of the United States Bankruptcy Code, as such sections may
be amended, or corresponding or superseding sections of the Bankruptcy Amendments and Federal
Judgeship Act of 1984, to file a claim for the full amount due to Administrative Agent or such
Lender under the Loan Documents or to require that all collateral shall continue to secure the
amounts due under the Loan Documents.

13.2 Limitation on Liability of Administrative Agent’s and the Lenders’ Officers, Employees,
etc. Any obligation or liability whatsoever of Administrative Agent or any Lender that may
arise at any time under this Agreement or any other Loan Document shall be satisfied, if at all,
out of Administrative Agent’s or such Lender’s assets only. No such obligation or liability shall
be personally binding upon, nor shall resort for the enforcement thereof be had to, the property of
any of Administrative Agent’s or any Lender’s shareholders, directors, officers, employees or
agents, regardless of whether such obligation or liability is in the nature of contract, tort or
otherwise.

14. ANTI-MONEY LAUNDERING AND INTERNATIONAL TRADE CONTROLS

14.1 Compliance with International Trade Control Laws and OFAC Regulations. Each Borrower
represents, warrants and covenants to Administrative Agent and the Lenders that:

     14.1.1 It is not now nor shall it be at any time until the Loans are fully repaid a Person
with whom a U.S. Person, including a Financial Institution, is prohibited from transacting business
of the type contemplated by this Agreement, whether such prohibition arises under U.S. law,
regulation, executive orders and lists published by the OFAC (including those executive orders and
lists published by OFAC with respect to Specially Designated Nationals and Blocked Persons) or
otherwise.

     14.1.2 No Borrower Party, no Guarantor, and no Person who owns a direct interest in any
Borrower is now nor shall be at any time until the Loans are fully repaid a Person with whom a U.S.
Person, including a Financial Institution, is prohibited from transacting business of the type
contemplated by this Agreement, whether such prohibition arises under U.S. law, regulation,
executive orders and lists published by the OFAC (including those executive orders and lists
published by OFAC with respect to Specially Designated Nationals and Blocked Persons) or otherwise.

14.2 Borrowers’ Funds.

     14.2.1 Each Borrower represents, warrants and covenants to Administrative Agent and the
Lenders that it has taken, and shall continue to take until the Loans are fully repaid, such
measures as are required by law to assure that the funds invested in such Borrower and/or used to
make payments on the Loans are derived (a) from transactions that do not violate U.S. law nor,

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to
the extent such funds originate outside the United States, do not violate the laws of the
jurisdiction in which they originated; and (b) from permissible sources under U.S. law or to the
extent such funds originate outside the United States, under the laws of the jurisdiction in which
they originated.

     14.2.2 Each Borrower further represents, warrants and covenants to Administrative Agent and
the Lenders that, to the best of its knowledge after making due inquiry, no Borrower, nor any
Borrower Party, nor any Guarantor, nor any holder of a direct interest in any Borrower, nor any
Person providing funds to any Borrower (a) is under investigation by any governmental authority
for, or has been charged with, or convicted of, money laundering, drug trafficking,
terrorist-related activities, any crimes which in the United State would be predicate crimes to
money laundering, or any violation of any Anti-Money Laundering Laws; (b) has been assessed civil
or criminal penalties under any Anti-Money Laundering Laws; and (c) has had any of its funds seized
or forfeited in any action under any Anti-Money Laundering Laws.

14.3 Borrower Compliance with Patriot Act. Each Borrower represents and warrants that it
is in compliance with any and all applicable provisions of the Patriot Act.

14.4 Cooperation with Administrative Agent. After the Closing Date, each Borrower agrees
to cooperate with Administrative Agent and the Lenders, and to cause each Borrower Party and
Guarantor to cooperate with Administrative Agent and the Lenders, in providing such additional
information and documentation on such Borrower’s and each Borrower Party’s legal or beneficial
ownership, policies, procedures and sources of funds as Administrative Agent and the Lenders deem
necessary or prudent to enable Administrative Agent and the Lenders to comply with Anti-Money
Laundering Laws as now in existence or hereafter amended. From time to time upon the written
request of Administrative Agent and the Lenders, each Borrower shall deliver to Administrative
Agent and the Lenders a schedule of the name, legal domicile address and jurisdiction of
organization, if applicable, for each Borrower Party and each holder of a legal interest in such
Borrower.

14.5 Additional Events of Default. If (l) any Borrower shall fail to comply with any of
the provisions of this Article 14, or (2) any representation, warranty or covenant of such
Borrower under this Article 14, or any representation, warranty or covenant made by any
Person that proposes to become a partner, member or shareholder in any Borrower after the date of
which this Agreement is made (an “Interest Holder”), shall be false, misleading or
incorrect as of the date made, then Administrative Agent, in addition to all of its other rights
and remedies hereunder, may declare that an Event of Default exists under this Agreement. Each
Borrower shall notify Administrative Agent promptly of any change in facts or circumstances that
causes any of the representations, warranties or covenants in this Article 14 to be untrue.

14.6 Representations and Warranties True and Correct. Each Borrower further represents,
warrants and covenants that all evidence of such Borrower’s, each Borrower Party’s and each
Guarantor’s identity provided to Administrative Agent is genuine, that all related information is
accurate and that such Borrower has acquired and shall hold its interest in its Project(s) for its
own account, risk and beneficial interest, without the obligation or intention to sell, distribute,
assign or transfer all or any portion of such interest to any other Person.

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14.7 Actions Taken Pursuant to Anti-Money Laundering Laws. If Administrative Agent
reasonably believes that any Borrower, any Borrower Party, any Guarantor or any Interest Holder,
may have the breached any of its representations, warranties or covenants set forth in this
Article 14, Administrative Agent has the right (and may have the obligation under
applicable law), with or without notice to any such Borrower, to (1) notify the appropriate
governmental authority (or authorities) and to take such action as such governmental authority (or
authorities) may direct; (2) withhold Loan advances and segregate assets constituting the Loans or
any of such Borrower’s funds or assets deposited with or otherwise controlled by Administrative
Agent pursuant to the Loan Documents; (3) decline any payment (or deposit such payment with an
appropriate United States governmental authority or court) or decline any prepayment or consent
request, and/or declare an Event of Default and immediately accelerate the Loans. Each Borrower
agrees that it shall not assert any claim (and hereby waives any claim that it may now or hereafter
have) against Administrative Agent, the Lenders or any of their affiliates, successors, assigns, or
agents for any form of damages as a result of any of the foregoing actions, regardless of whether
Administrative Agent’s reasonable belief is ultimately demonstrated to be accurate.

15. THE ADMINISTRATIVE AGENT

15.1 Appointment, Powers and Immunities. Each Lender hereby appoints and authorizes
Administrative Agent to act as its agent hereunder and under the other Loan Documents with such
powers as are specifically delegated to Administrative Agent by the terms of this Agreement and of
the other Loan Documents, together with such other powers as are reasonably incidental thereto.
Administrative Agent (which term as used in this sentence and in Section 15.5 and the first
sentence of Section 15.6 shall include reference to its affiliates and its own and its
affiliates’ officers, directors, employees and agents):

     15.1.1 shall have no duties or responsibilities except those expressly set forth in this
Agreement and in the other Loan Documents, and shall not by reason of this Agreement or any other
Loan Document be a trustee for any Lender;

     15.1.2 shall not be responsible to the Lenders for any recitals, statements, representations
or warranties contained in this Agreement or in any other Loan Document, or in any certificate or
other document referred to or provided for in, or received by any of them under, this Agreement or
any other Loan Document, or for the value, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement, any Note or any other Loan Document or any other document referred
to or provided for herein or therein or for any failure by any Borrower or any other Person to
perform any of its obligations hereunder or thereunder; and

     15.1.3 shall not be responsible for any action taken or omitted to be taken by it hereunder or
under any other Loan Document or under any other document or instrument referred to or provided for
herein or therein or in connection herewith or therewith, except to the extent any such action
taken or omitted violates Administrative Agent’s standard of care set forth in the first sentence
of Section 15.5.

Administrative Agent may employ agents and attorneys-in-fact, and may delegate all or any part of
its obligations hereunder, to third parties and shall not be responsible for the negligence or
misconduct of any such agents, attorneys-in-fact or third parties selected by it in good faith.
Administrative Agent may deem and treat the payee of a Note as the holder thereof for all

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purposes
hereof unless and until a notice of the assignment or transfer thereof shall have been filed with
Administrative Agent.

15.2 Reliance by Administrative Agent. Administrative Agent shall be entitled to rely upon
any certification, notice or other communication (including, without limitation, any thereof by
telephone, telecopy, telegram or cable) reasonably believed by it to be genuine and correct and to
have been signed or sent by or on behalf of the proper Person or Persons, and upon advice and
statements of legal counsel, independent accountants and other experts selected by Administrative
Agent. As to any matters not expressly provided for by this Agreement or any other Loan Document,
Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting,
hereunder or thereunder in accordance with instructions given by the Majority Lenders, and such
instructions of the Majority Lenders and any action taken or failure to act pursuant thereto shall
be binding on all of the Lenders.

15.3 Defaults. Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of a Potential Default or Event of Default unless Administrative Agent has received
notice from a Lender or a Borrower specifying such Potential Default or Event of Default and
stating that such notice is a “Notice of Default”. In the event that Administrative Agent receives
such a notice of the occurrence of a Potential Default or Event of Default, Administrative Agent
shall give prompt notice thereof to the Lenders. Administrative Agent shall (subject to
Section 15.7) take such action with respect to such Potential Default or Event of Default
and other matters relating to the Loans as shall be directed by the Lenders in accordance with a
separate agreement entered into by Administrative Agent and the Lenders.

15.4 Rights as a Lender. With respect to Administrative Agent’s Commitment and the Loans
made by it, Administrative Agent (and any successor acting as Administrative Agent) in its capacity
as a Lender hereunder shall have the same rights and powers hereunder as any other Lender and may
exercise the same as though it were not acting as Administrative Agent, and the term “Lender” or
“Lenders” shall, unless the context otherwise indicates, include Administrative Agent in its
individual capacity. Administrative Agent (and any successor acting as Administrative Agent) and
its affiliates (including Administrative Agent) may (without having to account therefor to any
Lender) lend money to, make investments in and generally engage in any kind of lending, trust or
other business with any Borrower (and any of its Affiliates) as if it were not acting as
Administrative Agent, and Administrative Agent and its affiliates (including Administrative Agent
may accept fees and other consideration from any Borrower for services in connection with this
Agreement or otherwise without having to account for the same to the Lenders.

15.5 Standard of Care; Indemnification. In performing its duties under the Loan Documents,
Administrative Agent will exercise the same degree of care as Administrative Agent normally
exercises in connection with real estate loans in which no syndication or participations are
involved, but Administrative Agent shall have no further responsibility to any Lender except as
expressly provided herein and except for its own gross negligence or willful misconduct which
resulted in actual loss to such Lender, and, except to such extent, Administrative Agent shall have
no responsibility to any Lender for the failure by Administrative Agent to comply with any of
Administrative Agent’s obligations to Borrowers under the Loan Documents or otherwise. The Lenders
agree to indemnify Administrative Agent (to the extent not reimbursed under Section 12.5,
but without limiting the obligations of Borrowers under Section 12.5) ratably in

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accordance
with the aggregate principal amount of the Loans held by the Lenders (or, if no Loans are at the
time outstanding, ratably in accordance with their respective Commitments), for any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever that may be imposed on, incurred by or asserted
against Administrative Agent (including by any Lender) arising out of or by reason of any
investigation in or in any way relating to or arising out of this Agreement or any other Loan
Document or any other documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby (including, without limitation, the costs and expenses
that Borrowers are obligated to pay under Section 12.5, but excluding, unless a Event of
Default has occurred and is continuing, normal administrative costs and expenses incident to the
performance of its agency duties hereunder) or the enforcement of any of the terms hereof or
thereof or of any such other documents, provided that no Lender shall be liable for any of the
foregoing to the extent they arise from Administrative Agent’s breach of its standard of care set
forth in the first sentence of this Section.

15.6 Non-Reliance on Administrative Agent and Other Lenders. Each Lender agrees that it
has, independently and without reliance on Administrative Agent or any other Lender, and based on
such documents and information as it has deemed appropriate, made its own credit analysis of
Borrowers and their Affiliates and decision to enter into this Agreement and that it will,
independently and without reliance upon Administrative Agent or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue to make its own
analysis and decisions in taking or not taking action under this Agreement or under any other Loan
Document. Subject to the provisions of the first sentence of Section 15.5, Administrative
Agent shall not be required to keep itself informed as to the performance or observance by
Borrowers of this Agreement or any of the other Loan Documents or any other document referred to or
provided for herein or therein or to inspect any Project or the books of any Borrower or any of
their Affiliates. Except for notices, reports and other documents and information expressly
required to be furnished to the Lenders by Administrative Agent hereunder or as otherwise agreed by
Administrative Agent and the Lenders, Administrative Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information concerning the affairs,
financial condition or business of any Borrower or any of its Affiliates that may come into the
possession of Administrative Agent or any of its affiliates.

15.7 Failure to Act. Except for action expressly required of Administrative Agent
hereunder, and under the other Loan Documents, Administrative Agent shall in all cases be fully
justified in failing or refusing to act hereunder and thereunder unless it shall receive further
assurances to its satisfaction from the Lenders of their indemnification obligations under
Section 15.5 against any and all liability and expense that may be incurred by it by reason
of taking or continuing to take any such action.

15.8 Resignation of Administrative Agent. Administrative Agent may resign at any time by
giving notice thereof to the Lenders and Borrowers. Upon any such resignation, the Majority
Lenders shall have the right to appoint a successor Administrative Agent which shall be a financial
institution that has (a) an office in New York, New York with a combined capital and surplus of at
least $500,000,000 and (b) knowledge and experience comparable to the resigning Administrative
Agent’s knowledge and experience in the servicing of loans similar to the Loans hereunder. If no
successor Administrative Agent shall have been so appointed by the Majority Lenders and shall have
accepted such appointment within thirty (30) days after the retiring

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Administrative Agent’s giving
of notice of resignation of the retiring Administrative Agent, then the retiring Administrative
Agent’s resignation shall nonetheless become effective and (i) the retiring Administrative Agent
shall be discharged from its duties and obligations hereunder and (ii) the Majority Lenders shall
perform the duties of Administrative Agent (and all payments and communications provided to be made
by, to or through Administrative Agent shall instead be made by or to each Lender directly) until
such time as the Majority Lenders appoint a successor agent as provided for above in this
Section 15.8. Upon the acceptance of any appointment as Administrative Agent hereunder by
a successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the retiring (or retired)
Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and
obligations hereunder (if not already discharged therefrom as provided above in this Section
15.8). The fees payable by Borrowers to a successor Administrative Agent shall be the same as
those payable to its predecessor unless otherwise agreed between Borrowers and such successor.
After any retiring Administrative Agent’s resignation hereunder as Administrative Agent, the
provisions of this Article 15 and Section 12.5 shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while it was acting as
Administrative Agent.

16. MULTIPLE OBLIGORS

16.1 Multiple Mortgages and Notes. Each Borrower acknowledges, represents and warrants the
following:

     16.1.1 Amounts of Notes. The amounts of the Notes executed by the respective
Borrowers represent a reasonable allocation of the Loans among the various Borrowers, taking into
account the value of the assets of each Borrower.

     16.1.2 Disbursement and Direct Benefit. Each Borrower’s allocable share of the Loans
has been or, in accordance with this Agreement will be, disbursed to such Borrower or to
creditor(s) of such Borrower on account of reduction of such Borrower’s indebtedness to such
creditor(s). The principal amount outstanding under each Borrower’s Note represents direct benefit
received by such Borrower on account of the Loans.

     16.1.3 Inducement. The Lenders have been induced to make the Loans to Borrowers in
part based upon the assurances by each Borrower that each Borrower desires the Notes and Mortgages
to be honored and enforced as separate obligations of each Borrower, should Administrative Agent
and the Lenders desire to do so.

     16.1.4 Separate Foreclosures. Each Borrower desires and intends that the Notes and
Mortgages executed by it may be enforced (by foreclosure or otherwise) separately from the Notes
and Mortgages executed by the other Borrowers.

     16.1.5 Combined Liability. Notwithstanding the foregoing, the Loans constitute the
joint and several obligation of each and every Borrower, and Administrative Agent and the Lenders
may at their option enforce the entire amount of the Loans against any one or more Borrowers.
However, due to the operation of Section 13.1, each Borrower acknowledges that as a
practical matter the amount of any Borrower’s liability with respect to the Loans cannot exceed the
value of such Borrower’s assets and thus the Loans cannot render any Borrower insolvent.

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     16.1.6 Separate Exercise of Remedies. Subject to Section 13.1 and any
limitations set forth in the Mortgages, Administrative Agent (on behalf of the Lenders) may
exercise remedies against each Borrower and its property separately, whether or not Administrative
Agent exercises remedies against any other Borrower or its property. Administrative Agent may
enforce one or more Borrowers’ obligations without enforcing the other Borrowers’ obligations. Any
failure or inability of Administrative Agent to enforce one or more Borrowers’ obligations shall
not in any way limit Administrative Agent’s right to enforce the obligations of any other Borrower.
If Administrative Agent forecloses or exercises similar remedies under any one or more
Mortgage(s), then such foreclosure or similar remedy shall be deemed to reduce the balance of the
Loans only to the extent of the cash proceeds actually realized by the Lenders from such
foreclosure or similar remedy or, if applicable, Administrative Agent’s credit bid at such sale,
regardless of the effect of such foreclosure or similar remedy on the Note(s) or Guaranties
actually secured by such Mortgage(s) under the applicable state law. If Administrative Agent
accepts a deed in lieu of foreclosure of any one or more Projects from one or more Borrowers, then
such acceptance shall not be deemed to diminish any other Borrower’s liability for the full amount
of the Loans and such Borrower’s other liabilities under this Agreement and the other Loan
Documents, except to the extent that Administrative Agent and the Lenders otherwise agree in
writing.

     16.1.7 Second Mortgages. Borrowers and the Lenders acknowledge that the Second
Mortgage executed by each Borrower is intended to secure the obligations of such Borrower under the
Secured Guaranty executed by such Borrower in an amount equal to the amount of all Loans, other
than the Loans represented and evidenced by the Notes executed by such Borrower and secured by the
related First Mortgage of such Borrower. Notwithstanding the foregoing, at Borrowers’ request,
Administrative Agent and the Lenders have agreed that certain Second Mortgages shall secure an
amount (the “Apportioned Amount”) less than the amount of all Loans other than the Loans
represented and evidenced by the Notes executed by such Borrower and secured by the related First
Mortgage of such Borrower. With respect to each Second Mortgage securing an Apportioned Amount and
notwithstanding the Principal Repayment Allocations, each Borrower agrees that all amounts received
by Administrative Agent and the Lenders which are required or otherwise applied to payment of the
principal amount of the Loans shall first be applied to the principal amount of all Loans other
than those comprising any part (or all) of the Apportioned Amount (the “Excess
Obligations”), and only when the Excess Obligations have been paid in full shall subsequent
payments in respect of the principal amount of the Loans be credited against the Apportioned
Amount.

16.2 Waivers 

     16.2.1 General. Subject to Section 12.2 hereof, without notice to, or consent
by, any Borrower, and in Administrative Agent’s sole and absolute discretion and without prejudice
to any Lender or in any way limiting or reducing each or any Borrower’s liability for all of its
obligations under this Agreement and the other Loan Documents, Administrative Agent may: (a) grant
extensions of time, renewals or other indulgences or modifications to any Borrower(s) or any other
party under any of the Loans Document(s), (b) agree with Borrowers to change the rate of interest
under the Loans, (c) agree with Borrowers to change, amend or modify any Loan Document(s), (d) to
the extent permitted under the Loan Documents following an Event of Default, sell, exchange,
release or exercise remedies with respect to any or all collateral, (e) accept or reject additional
collateral for the Loans or any portion thereof, (f) discharge or

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release any party or parties
liable under the Loan Documents, (g) foreclose or otherwise realize on any collateral, or attempt
to foreclose or otherwise realize on any collateral, whether such attempt is successful or
unsuccessful, and whether such attempt relates to some or all or only some portion of the
collateral, (h) accept or make compositions or other arrangements or file or refrain from filing a
claim in any bankruptcy, insolvency or similar proceeding, (i) make other or additional loans to
any Borrower(s) in such amount(s) and at such time(s) as Administrative Agent may determine, and
(j) credit payments in such manner and order of priority to principal, interest or other
obligations as Administrative Agent may determine in its discretion, except as otherwise provided
in this Agreement. Without limiting the generality of the foregoing, except as might be provided
in this Agreement to the contrary, each or any Borrower’s liability for the Loans shall continue
even if Administrative Agent and any other Borrower(s) alter any obligations under the Loan
Documents in any respect or Administrative Agent’s (or any Borrower’s) remedies or rights against
any Borrower are in any way impaired or suspended without any Borrower’s consent. If
Administrative Agent performs any of the actions described in this Section 16.2.1, then
every Borrower’s liability shall continue in full force and effect even if Administrative Agent’s
actions impair, diminish or eliminate any Borrower’s subrogation, contribution or reimbursement
rights (if any) against any other Borrower.

     16.2.2 Waivers of Rights and Defenses. Each Borrower waives any right to require
Administrative Agent to (a) proceed against any particular Borrower(s) or any particular Project(s)
or other collateral or in any particular order of realization, (b) proceed against or exhaust any
Project(s) or other collateral, or (c) pursue any other right or remedy. Each Borrower agrees that
Administrative Agent may proceed against each or any Borrower with respect to the obligations of
such Borrower under this Agreement and the other Loan Documents without taking any actions against
any other Borrower(s) and without proceeding against or exhausting any Project(s) or other
collateral. Each Borrower agrees that Administrative Agent (on behalf of the Lenders) may
unqualifiedly exercise (or refrain from exercising) in its sole discretion any or all rights and
remedies available to it against any Borrower without impairing Administrative Agent’s rights and
remedies in enforcing the obligations of any Borrower under this Agreement or the other Loan
Documents, under which every Borrower’s liabilities shall remain independent and unconditional.
Each Borrower agrees and acknowledges that Administrative Agent’s exercise of certain of such
rights or remedies may affect or eliminate such Borrower’s right of subrogation or recovery (if
any) against any or all of the other Borrowers and that such Borrower may incur a partially or
totally non-reimbursable liability in performing its obligations under the Loan Documents. Without
limiting the generality of any other waivers in this Agreement, each Borrower expressly waives any
statutory or other right that such Borrower might otherwise have to require Administrative Agent to
exhaust the collateral (or collateral held with respect to other Borrower(s)) before Administrative
Agent may proceed against the collateral owned by such Borrower.

     16.2.3 Additional Waivers. Each Borrower waives diligence and all demands, protest,
presentments and notices of every kind or nature except notices of default, notices to cure and
notices that, in any of the foregoing cases, are either required by law or by the Loan Documents,
including notices of protest, dishonor, nonpayment, acceptance of the obligations of such Borrower
under this Agreement and the other Loan Documents and the creation, renewal, extension,
modification or accrual of any such obligations. No failure or delay on Administrative Agent’s or
any Lender’s part in exercising any power, right or privilege under the Loan Documents shall impair
or waive any such power, right or privilege.

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16.3 Full Knowledge. Each Borrower acknowledges, represents and warrants that such
Borrower has had a full and adequate opportunity to review the Loan Documents, the transaction
contemplated by the Loan Documents and all underlying facts relating to such transaction. Each
Borrower represents and warrants that such Borrower fully understands: (a) the remedies
Administrative Agent (on behalf of the Lenders) may pursue against such Borrower and each other
Borrower in the event of a default under the Loan Documents, (b) the value (if any) of any
collateral, and (c) such Borrower’s and each other Borrower’s financial condition and ability to
perform under the Loan Documents. Each Borrower agrees to keep itself fully informed regarding all
aspects of such Borrower’s and each other Borrower’s financial condition and the performance of
such Borrower’s and each other Borrower’s obligations under this Agreement and the other Loan
Documents. Each Borrower agrees that neither Administrative Agent nor any Lender has any duty,
whether now or in the future, to disclose to any Borrower any information pertaining to such
Borrower, any collateral or any other Borrower.

16.4 Deferral of Reimbursement. Each Borrower waives any right to be reimbursed by any
other Borrower for any payment(s) made by such Borrower or from such Borrower’s property on account
of the obligations of any Borrower under this Agreement or any other Loan Document, unless and
until all such obligations under the Loan Documents then required to be performed have been paid
and performed (as applicable) in full. Each Borrower acknowledges that such Borrower has received
adequate consideration for execution of the Loan Documents to which such Borrower is a party by
virtue of Lenders’ making the Loans (which benefit each and every Borrower). No Borrower requires
or expects, and no Borrower is entitled to, any other right of reimbursement against any other
Borrower as consideration for entering into the Loan Documents to which such Borrower is a party.

16.5 Deferral of Subrogation and Contribution.

     16.5.1 Deferral. Each Borrower agrees it shall have no right of subrogation against
any Lender or any other Borrower, no right of subrogation against any collateral, and no right of
contribution against any other Borrower unless and until: (a) such right of subrogation does not
violate (or otherwise produce any result adverse to Administrative Agent or any Lender under) any
applicable law, including any bankruptcy or insolvency law; and (b) all amounts then owed under the
Loan Documents have been paid in full and all other performance required under the Loan Documents
has been rendered in full to Administrative Agent and the Lenders (such deferral of Borrowers’
subrogation and contribution rights, the “Subrogation Deferral”).

     16.5.2 Effect of Invalidation. To the extent that a court of competent jurisdiction
determines that any Borrower’s Subrogation Deferral is void or voidable for any reason, such
Borrower agrees that such Borrower’s rights of subrogation against Administrative Agent and the
Lenders or any other Borrower(s) and such Borrower’s right of subrogation against any collateral
shall at all times be junior and subordinate to Administrative Agent’s and the Lenders’ rights
against all Borrowers and Administrative Agent’s and the Lenders’ right, title and interest in such
collateral.

16.6 Lender’s Disgorgement of Payments. Upon payment of all or any portion of the Loans,
every Borrower’s obligations under the Loan Documents shall continue and remain in full force and
effect if all or any part of such payment is, pursuant to any bankruptcy, insolvency or similar
proceeding or otherwise, avoided or recovered directly or indirectly from Administrative Agent

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or
any Lender as a preference, fraudulent transfer or otherwise, irrespective of (a) any notice of
revocation given by such Borrower prior to such avoidance or recovery, or (b) payment in full of
the Loans. Each Borrower’s liability under the Loan Documents shall continue until all periods
have expired within which Administrative Agent or the Lenders could (on account of bankruptcy or
insolvency proceedings, whether or not then pending, affecting any Borrower or any other person) be
required to return or repay any amount paid at any time on account of the Loans. If, in any such
proceeding, any party seeks to require Administrative Agent or any Lender to disgorge or repay any
payments previously made by any Borrower to Administrative Agent or any Lender, then such Borrower
and/or every Borrower shall jointly and severally be obligated to pay Administrative Agent or such
Lender, within ten (10) days after such written request, an amount equal to the amount adjudicated
to be disgorged or repaid.

[Signature Pages Follow]

80

 

EXECUTED as of the date first written above.

	 	 	 	 	 
	LENDER:	 	GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 	 	Lending Office for Libor-based and

Alternate Base Rate Loans:
	 
	 	 	 	 
	 	 	General Electric Capital Corporation
	 	 	125 Park Avenue
	 	 	New York, New York 10017
	 	 	Attention: Asset Manager
	 	 	Telecopier No.: (212) 573-9733
	 
	 	 	 	 
	 	 	Lending Office:
	 
	 	 	 	 
	 	 	General Electric Capital Corporation
	 	 	125 Park Avenue
	 	 	New York, New York 10017
	 	 	Attention: Asset Manager
	 	 	Telecopier No.: (212) 573-9733

81

 

	 	 	 	 	 	 	 	 	 
	 	 	BORROWERS
	 
	 	 	 	 	 	 	 	 
	 	 	TARRAGON HUNTSVILLE APARTMENTS, L.L.C., an Alabama
limited liability company
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 	 	 
	 	 	WEST DALE NATIONAL ASSOCIATES, L.P., a Texas limited
partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Vintage National, Inc., a Texas corporation, its
General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 	 	 
	 	 	MANCHESTER TARRAGON, LLC, a Connecticut limited

liability company
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Woodcreek Garden Apartments, a California

limited partnership, its Managing Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	TRI Woodcreek, Inc., a Nevada corporation,
its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Kathryn Mansfield
	 

	 	 	 	 	 	 	 	Executive Vice President and
Secretary

 

 

	 	 	 	 	 	 	 
	 	 	AUTUMN RIDGE APARTMENTS, LLC, a Connecticut

limited liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 
	 	 	DOGWOOD HILLS APARTMENTS, LLC, a Connecticut limited

liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 
	 	 	FOREST PARK TARRAGON, LLC, a Connecticut limited

liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 
	 	 	ANSONIA ACQUISITIONS I, LLC, a Connecticut limited

liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary

 

 

	 	 	 	 	 	 	 
	 	 	HAMDEN CENTRE APARTMENTS, LLC, a Connecticut

limited liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 
	 	 	ANSONIA LIBERTY, LLC, a Connecticut limited liability

company
	 
	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 
	 	 	OCEAN BEACH APARTMENTS, LLC, a Connecticut limited

liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 
	 	 	DANFORTH APARTMENT OWNERS, L.L.C., a Florida limited
liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary

 

 

	 	 	 	 	 	 	 
	 	 	HERON COVE NATIONAL, INC., a Florida
corporation
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 	 	 	 	 
	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 
	 	 	PLANTATION BAY APARTMENTS, L.L.C., a Florida limited
liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 
	 	 	TARRAGON SAVANNAH I, L.L.C., a Georgia limited
liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 
	 	 	TARRAGON SAVANNAH II, L.L.C., a Georgia limited
liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	Ansonia MezzCo, LLC, a Delaware limited

liability company, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary

 

 

	 	 	 	 	 	 	 
	 	 	HEATHER LIMITED PARTNERSHIP, a Maryland

limited partnership
	 
	 	 	 	 	 	 
	 	 	By:	 	Vintage National, Inc., a Texas corporation, its
General Partner
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 
	 	 	SUMMIT / TARRAGON MURFREESBORO, L.L.C., a Tennessee
limited liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	Stewart Square National, Inc., a Nevada
corporation, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary
	 
	 	 	 	 	 	 
	 	 	VINTAGE LEGACY LAKES NATIONAL, L.P., a Texas limited
partnership
	 
	 	 	 	 	 	 
	 	 	By:	 	Vintage National, Inc., a Texas corporation, its
General Partner
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary

 

 

	 	 	 	 	 
	ADMINISTRATIVE AGENT:	 	GENERAL ELECTRIC
CAPITAL CORPORATION,

 a Delaware corporation
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 

 

 

EXHIBIT A

LEGAL DESCRIPTION OF THE PROJECTS

[To be attached]

 

 

EXHIBIT B

LOCATION OF THE PROJECTS

	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	State	 	County
	Autumn Ridge

	 	90 Gerrish Avenue

East Haven, CT 06512
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Dogwood Hills

	 	200 Evergreen Avenue

Hamden, CT 06518
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Forest Park Apartments

	 	108D West Street

Rocky Hill, CT 06067
	 	CT
	 	Hartford
	 
	 	 	 	 	 	 
	Groton Towers

	 	39 Broad Street Extension

Groton, CT 06340
	 	CT
	 	New London
	 
	 	 	 	 	 	 
	Hamden Center

	 	169 School Street

Hamden, CT 06518
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Lakeview Apartments

	 	440 Meriden Road

Waterbury, CT 06705
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	The Liberty Building

	 	152 Temple Street

New Haven, CT 06510
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Ocean Beach Apartments

(fka Sandalwood)

	 	5 Nob Hill Road

New London, CT 06320
	 	CT
	 	New London
	 
	 	 	 	 	 	 
	Parkview Apartments

	 	270 Spring Street #5

Naugatuck, CT 06770
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Sagamore Hill

	 	1151-1189 Washington St.,
B-2

Middletown, CT 06457
	 	CT
	 	Middlesex
	 
	 	 	 	 	 	 
	Nutmeg Woods

	 	84 Hawthorne Drive

New London, CT 06320
	 	CT	 	 
	 
	 	 	 	 	 	 
	Woodcliff Estates

	 	181 Nutmeg Lane

East Hartford, CT 06118
	 	CT
	 	Hartford
	 
	 	 	 	 	 	 
	200 Fountain-Exec House

	 	216 Fountain Street

New Haven, CT 06516
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	278 Main Street-Giannotti

	 	278 Main Street

West Haven, CT 06516
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Lofts at the Mills

	 	210 Pine Street

Manchester, CT 06040
	 	CT
	 	Hartford
	 
	 	 	 	 	 	 
	 

	 	91 Elm Street

Manchester, CT 06040	 	 	 	 

 

 

	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	State	 	County
	Club at Danforth

	 	3701 Danforth Drive

Jacksonville, FL 32224
	 	FL
	 	Duval
	 
	 	 	 	 	 	 
	Vintage at Madison Crossing

	 	7584 Old Madison Pike

Huntsville, AL 35806
	 	AL
	 	Madison
	 
	 	 	 	 	 	 
	Heather Hill

	 	5837 Fisher Road

Temple Hills, MD 20748
	 	MD
	 	Prince George’s
	 
	 	 	 	 	 	 
	The Links at Georgetown

	 	Phase I & II

450 Al Henderson Blvd.

Savannah, GA 31419
	 	GA
	 	Chatham
	 
	 	 	 	 	 	 
	River City Landing

	 	2681 University Blvd.

Jacksonville, FL 32211
	 	FL
	 	Duval
	 
	 	 	 	 	 	 
	The Vintage at Legacy

	 	3700 Legacy Drive

Frisco, TX 75034
	 	TX
	 	Collin
	 
	 	 	 	 	 	 
	The Vintage at Plantation 

Bay

	 	7740 Plantation Bay Drive

Jacksonville, FL 32244
	 	FL
	 	Duval
	 
	 	 	 	 	 	 
	Vintage at the Parke

(fka Vintage @ Barfield)

	 	261 Barfield Crescent Road

Murfreesboro, TN 37129
	 	TN
	 	Rutherford

 

 

EXHIBIT C

FORM OF PROMISSORY NOTE

[To be attached]

 

 

EXHIBIT D

ALLOCATED LOAN AMOUNTS

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Total Allocated
	Property	 	Note A	 	Note B	 	Note C	 	Loan Amount
	Woodcliff Estates
	 	$	28,268,200	 	 	$	6,117,053	 	 	$	1,853,652	 	 	$	36,238,905	 
	Heather Hill
	 	$	27,538,134	 	 	$	5,937,432	 	 	$	1,799,22	 	 	$	35,174,789	 
	Lofts at the Mills
	 	$	23,212,566	 	 	$	5,023,047	 	 	$	1,522,135	 	 	$	29,757,748	 
	The Links at
Georgetown
	 	$	21,994,861	 	 	$	4,759,544	 	 	$	1,442,286	 	 	$	28,195,690	 
	Whalers-Nutmeg
	 	$	20,760,387	 	 	$	4,492,412	 	 	$	1,361,337	 	 	$	26,614,135	 
	The Club at Danforth
	 	$	19,715,046	 	 	$	4,266,207	 	 	$	1,292,790	 	 	$	25,274,043	 
	The Vintage at
Legacy
	 	$	18,992,842	 	 	$	4,109,926	 	 	$	1,245,432	 	 	$	24,348,201	 
	Ocean Beach
Apartments
	 	$	17,799,880	 	 	$	3,851,777	 	 	$	1,167,205	 	 	$	22,818,863	 
	The Vintage at
Plantation Bay
	 	$	16,927,223	 	 	$	3,662,940	 	 	$	1,109,982	 	 	$	21,700,146	 
	River City Landing
	 	$	14,182,058	 	 	$	3,068,904	 	 	$	929,971	 	 	$	18,180,933	 
	Vintage at the Park
	 	$	13,548,090	 	 	$	2,931,718	 	 	$	888,399	 	 	$	17,368,207	 
	The Liberty Building
	 	$	9,775,265	 	 	$	2,115,303	 	 	$	641,001	 	 	$	12,531,569	 
	200 Fountain-Exec.
House
	 	$	9,641,704	 	 	$	2,086,402	 	 	$	632,243	 	 	$	12,360,349	 
	Vintage at Madison
Crossing
	 	$	9,557,630	 	 	$	2,068,208	 	 	$	626,730	 	 	$	12,252,568	 
	Parkview Apartments
	 	$	9,220,275	 	 	$	1,995,207	 	 	$	604,608	 	 	$	11,820,091	 
	Forest Park
Apartments
	 	$	9,043,518	 	 	$	1,956,958	 	 	$	593,018	 	 	$	11,593,493	 
	Sagamore Hills
	 	$	8,736,275	 	 	$	1,890,473	 	 	$	572,871	 	 	$	11,199,619	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Total Allocated
	Property	 	Note A	 	Note B	 	Note C	 	Loan Amount
	Groton Towers
	 	$	6,867,451	 	 	$	1,486,071	 	 	$	450,325	 	 	$	8,803,847	 
	Autumn Ridge
	 	$	4,309,329	 	 	$	932,511	 	 	$	282,579	 	 	$	5,524,418	 
	Lakeview Apartments
	 	$	4,052,196	 	 	$	876,869	 	 	$	265,718	 	 	$	5,194,783	 
	278 Main
Street-Giannotti
	 	$	3,832,599	 	 	$	829,349	 	 	$	251,318	 	 	$	4,913,267	 
	Hamden Centre
	 	$	3,795,835	 	 	$	821,394	 	 	$	248,907	 	 	$	4,866,137	 
	Dogwood Hills
	 	$	3,328,635	 	 	$	720,295	 	 	$	218,271	 	 	$	4,267,201	 

 

 

EXHIBIT E

FORM OF ASSIGNMENT AND ACCEPTANCE

ASSIGNMENT AND ACCEPTANCE

          Reference is made to the Loan Agreement dated as of ___, 2005 (as amended and in
effect on the date hereof, the “Agreement”), between THE BORROWERS LISTED ON SCHEDULE 1
ATTACHED HERETO, the Lenders named therein and GENERAL ELECTRIC CAPITAL CORPORATION, as
Administrative Agent for the Lenders. Terms defined in the Agreement are used herein with the same
meanings.

          The Assignor named below hereby sells and assigns, without recourse, to the Assignee named
below, and the Assignee hereby purchases and assumes, without recourse, from the Assignor,
effective as of the Assignment Date set forth below, the interests set forth below (the
“Assigned Interest”) in the Assignor’s rights and obligations under the Agreement,
including, without limitation, the interests set forth below in the Commitment of the Assignor on
the Assignment Date and Loans owing to the Assignor which are outstanding on the Assignment Date,
together with (a) interest on the assigned Loans from and after the Assignment Date and (b) the
amount, if any, set forth below of the fees accrued to the Assignment Date for account of the
Assignor. The Assignee hereby acknowledges receipt of a copy of the Agreement and the Agency
Agreement. From and after the Assignment Date (i) the Assignee shall be a party to and be bound by
the provisions of (x) the Agreement and (y) the Agency Agreement and, in each case, to the extent
of the interests assigned by this Assignment and Acceptance, have the rights and obligations of a
Lender thereunder and (ii) the Assignor shall, to the extent of the interests assigned by this
Assignment and Acceptance, relinquish its rights and be released from its obligations under the
Agreement and the Agency Agreement.

          This Assignment and Acceptance is being delivered to the Administrative Agent together with,
if the Assignee is not already a Lender under the Agreement, an administrative questionnaire in the
form supplied by the Administrative Agent, duly completed by the Assignee. The [Assignee/Assignor]
shall pay the fee payable to the Administrative Agent pursuant to Section 12.27.2.E of the
Agreement.

          This Assignment and Acceptance shall be governed by and construed in accordance with the laws
of the State of New York.

          The Assignor represents and warrants to the Assignee that the Assignor is the legal and
beneficial owner of the Assigned Interest and has not created any adverse interest therein. The
Assignor and the Assignee represent and warrant to each other that they are, respectively,
authorized to execute and deliver this Assignment and Acceptance.

 

 

Date of Assignment:

Legal Name of Assignor:

Legal Name of Assignee:

Assignee’s Address for Notices:

Effective Date of Assignment

(“Assignment Date”)1:

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Percentage Assigned of
	 	 	 	 	 	 	Facility/Commitment
	 	 	 	 	 	 	(set forth, to at
	 	 	 	 	 	 	least 4 decimals, as a
	 	 	 	 	 	 	percentage of the
	 	 	 	 	 	 	Facility and the
	 	 	 	 	 	 	aggregate Commitments
	 	 	Principal Amount	 	of all Lenders
	 	 	Assigned	 	thereunder
	Current Outstanding
	 	 	 	 	 	 	 	 
	Loans Assigned:
	 	$	 	 	 	 	%]	 2
	 
	 	 	 	 	 	 	 	 
	Future Funding
	 	 	 	 	 	 	 	 
	Commitment:
	 	$	 	 	 	 	%	 

[Fees Assigned (if any):]

The terms set forth above and below are hereby agreed to:

	 	 	 	 	 
	 	[NAME OF ASSIGNOR]           , as Assignor

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	 	[NAME OF ASSIGNEE]           , as Assignee

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

 

			
	1	 	Must be at least five Business Days after
execution hereof by all required parties.
	 
	2	 	Delete if no future advances are involved.

 

 

The undersigned hereby consents to the within assignment:3

[                                        ],

as Administrative Agent

	 	 	 	 
	 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

 

			
	3	 	Consent to be included to the extent
required by Section 12.27.2 of the Agreement.

 

 

EXHIBIT F

LIST OF MANAGEMENT AGREEMENTS

	 	 	 
	Project	 	Agreement
	200 Fountain — Exec House

	 	Management Agreement by and
between West Dale National
Associates, L.P. (“Owner”) and
Tarragon Management, Inc.
(“Manager”), dated as of March 17,
2004
	 
	 	 
	Plantation Bay

	 	Management Agreement by and
between Plantation Bay Apartments,
L.L.C. (“Owner”) and Tarragon
Management, Inc. (“Manager”),
dated as of June 28, 2000
	 
	 	 
	Club at Danforth

	 	Management Agreement by and
between Danforth National
Apartments, Ltd. (“Owner”) and
Tarragon Management, Inc.
(“Manager”), dated as of August 1,
1999
	 
	 	 
	Woodcliff Estates

	 	Management Agreement by and
between Ansonia Acquisitions I,
L.L.C. (“Owner”) and Tarragon
Management, Inc. (“Manager”),
dated as of January 1, 2005
	 
	 	 
	Sagamore Hills

	 	Management Agreement by and
between Ansonia Acquisitions I,
L.L.C. (“Owner”) and Tarragon
Management, Inc. (“Manager”),
dated as of January 1, 2005
	 
	 	 
	Nutmeg Woods

	 	Management Agreement by and
between Ansonia Acquisitions I,
L.L.C. (“Owner”) and Tarragon
Management, Inc. (“Manager”),
dated as of January 1, 2005
	 
	 	 
	Forest Park

	 	Management Agreement by and
between Forest Park Tarragon, LLC
(“Owner”) and Tarragon Management,
Inc. (“Manager”), dated as of
January 1, 2005
	 
	 	 
	Dogwood Hills

	 	Management Agreement by and
between Dogwood Hills Apartments,
L.L.C. (“Owner”) and Tarragon
Management, Inc. (“Manager”),
dated as of January 1, 2005
	 
	 	 
	Parkview Apartment

	 	Management Agreement by and
between Ansonia Acquisitions I,
L.L.C. (“Owner”) and Tarragon
Management, Inc. (“Manager”),
dated as of January 1, 2005
	 
	 	 
	Ocean Beach

	 	Management Agreement by and
between Ocean Beach Apartments
L.L.C. (“Owner”) and Tarragon
Management, Inc. (“Manager”),
dated as of January 1, 2005
	 
	 	 
	Liberty Building

	 	Management Agreement by and
between Ansonia Liberty, L.L.C.
(“Owner”) and Tarragon Management,
Inc. (“Manager”), dated as of
January 1, 2005
	 
	 	 
	Lakeview

	 	Management Agreement by and
between Ansonia Acquisitions I,
L.L.C. (“Owner”) and Tarragon
Management, Inc. (“Manager”),
dated as of January 1, 2005
	 
	 	 
	Hamden Centre

	 	Management Agreement by and
between Hamden Centre Apartments,
L.L.C. (“Owner”) and Tarragon
Management, Inc. (“Manager”),
dated as of January 1, 2005

 

 

	 	 	 
	Project	 	Agreement
	Vintage at Madison Crossing

	 	Management Agreement by and
between Tarragon Huntsville
Apartments, L.L.C. (“Owner”) and
Tarragon Management, Inc.
(“Manager”), dated as of January
1, 2005
	 
	 	 
	Autumn Ridge

	 	Management Agreement by and
between Autumn Ridge Partners
(“Owner”) and Tarragon Management,
Inc. (“Manager”), dated as of
December 4, 1997
	 
	 	 
	Vintage at the Parke

	 	Management Agreement by and
between Summit/Tarragon
Murfreesboro, L.L.C. (“Owner”) and
Tarragon Management, Inc.
(“Manager”), dated as of January
1, 2003
	 
	 	 
	River City

	 	Management Agreement by and
between Heron Cove National, Inc.
(“Owner”) and Tarragon Management,
Inc. (“Manager”), dated as of June
1, 1999
	 
	 	 
	Lofts at the Mills

(Yarn Mills Apartments)

(Weaver Mill Apartments)

	 	Management Agreement by and
between Manchester Tarragon, LLC
(“Owner”) and Tarragon Management,
Inc. (“Manager”), dated as of
February 8, 2005 (Yarn Mills
Apartments) 

Management Agreement by and
between Manchester Tarragon, LLC
(“Owner”) and Tarragon Management,
Inc. (“Manager”), dated as of
February 8, 2005 (Weaver Mills
Apartments)
	 
	 	 
	The Links at Georgetown

	 	Management Agreement by and
between Tarragon Savannah II,
L.L.C. (“Owner”) and Tarragon
Management, Inc. (“Manager”),
dated as of January 1, 2002
Management Agreement by and
between Tarragon Savannah, L.P.
(“Owner”) and Tarragon Management,
Inc. (“Manager”), dated as of May
4, 1999
	 
	 	 
	Vintage at Legacy

	 	Management Agreement by and
between Vintage Legacy Lakes
National, L.P. (“Owner”) and
Pacific West Management, Inc.
(“Manager”), dated as January 1,
2002
	 
	 	 
	Heather Hill Apartments

	 	Management Agreement by and
between Heather Limited
Partnership (“Owner”) and Sunchase
American, Ltd. (“Manager”), dated
as of January 1, 2002
	 
	 	 
	Gianotti Apartments

	 	Management Agreement by and
between Manchester Tarragon, LLC
(“Owner”) and Tarragon Management,
Inc. (“Manager”), dated as of
February 8, 2005
	 
	 	 
	Groton Towers

	 	Management Agreement by and
between Ansonia Acquisitions I,
LLC (“Owner”) and Tarragon
Management, Inc. (“Manager”),
dated as of January 1, 2005

 

 

EXHIBIT G

STRUCTURE CHART

[To be attached]

 

 

EXHIBIT H

RESERVED

(See Attached)

 

 

EXHIBIT I

FORM OF INTEREST RATE PROTECTION PLEDGE

(See Attached)

 

 

EXHIBIT J

DEFEASANCE

1. In accordance with Section 2.3.5 of this Agreement, Borrowers may obtain the release of
one or more Projects (each a “Defeased Project”) from the lien of the applicable Mortgages
relating to such Defeased Project upon the satisfaction of the following conditions precedent:

     (a) not less than thirty (30) days prior written notice to Administrative Agent specifying a
regularly scheduled Payment Date (the “Release Date”) on which the Defeasance Deposit
(hereinafter defined) is to be made;

     (b) the payment to Administrative Agent of interest accrued and unpaid on the principal
balance of the Notes to and including the Release Date;

     (c) the payment to Administrative Agent of all other sums, not including scheduled interest or
principal payments, due under the Notes, the Mortgages, the Assignments of Leases and Rents, and
the other Loan Documents;

     (d) the payment to Administrative Agent of the Defeasance Deposit and a $5,000 non-refundable
processing fee;

     (e) the delivery by the applicable Borrower to Administrative Agent (on behalf of the Lenders)
of:

     (i) a security agreement in form and substance satisfactory to Administrative Agent,
creating a first priority lien on the Defeasance Deposit and the U.S. Obligations
(hereinafter defined) purchased on behalf of the applicable Borrowers with the Defeasance
Deposit in accordance with this Exhibit J (the “Security Agreement”);

     (ii) a release of the Defeased Project from the lien of the applicable Mortgages (for
execution by Administrative Agent (on behalf of the Lenders)) in a form appropriate for the
jurisdiction in which the Defeased Project is located;

     (iii) an officer’s certificate of the applicable Borrower certifying that the
requirements set forth in this paragraph (e) have been satisfied;

     (iv) an opinion of counsel in form and substance, and rendered by counsel satisfactory
to Administrative Agent at the expense of the applicable Borrower, stating, among other
things, that Administrative Agent (on behalf of the Lenders) has a perfected first priority
security interest in the Defeasance Deposit and the U.S. Obligations purchased by or on
behalf of the applicable Borrower and pledged to Administrative Agent and as to
enforceability of the Security Agreement and other documents delivered in connection
therewith;

     (v) if required by the Rating Agencies and/or pooling and servicing agreement relating
to the Secondary Market Transaction, evidence in writing from the applicable Rating Agencies
to the effect that such release will not result in a qualification,

 

 

downgrade or withdrawal
of any rating in effect immediately prior to such defeasance for any securities issued in
connection with a Secondary Market Transaction; and

     (vi) such other certificates, documents or instruments as Administrative Agent may
reasonably request.

     (f) if the Loans have been sold in a Secondary Market Transaction, Administrative Agent shall
have received an opinion of counsel acceptable to Administrative Agent in form satisfactory to
Administrative Agent stating, among other things, that the substitution of collateral shall not
cause the holder of the Loans to fail to maintain its status as a real estate mortgage investment
conduit (REMIC); and

     (g) Administrative Agent shall have received a certificate from a nationally recognized
independent certified public accountant acceptable to Administrative Agent, in form and substance
satisfactory to Administrative Agent, certifying that the U.S. Obligations purchased with the
Defeasance Deposit will generate sufficient sums to satisfy the obligations of the applicable
Borrower under the Notes and this Exhibit J as and when such obligations become due.

In connection with the conditions set forth above, the applicable Borrower hereby appoints
Administrative Agent as its agent and attorney in fact for the purpose of using the Defeasance
Deposit to purchase or cause to be purchased U.S. Obligations which provide payments on or prior
to, but as close as possible to, all successive scheduled Payment Dates after the Release Date upon
which interest and principal payments are required under the Notes including the amounts due on the
Maturity Date and in amounts equal to the scheduled payments due on such dates under the Notes plus
Administrative Agent’s estimate of administrative expenses and applicable federal income taxes
associated with or to be incurred by the Successor Borrower (as defined below) during the remaining
term of, and applicable to, the Loans (the “Scheduled Defeasance Payments”). The
applicable Borrower, pursuant to the Security Agreement or other appropriate document, shall
authorize and direct that the payments received from the U.S. Obligations may be made directly to
Administrative Agent and applied to satisfy the obligations of such Borrower under the Notes and
this Exhibit J.

2. Upon compliance with the requirements of this Exhibit J, the Defeased Project shall be
released from the lien of the applicable Mortgages and the pledged U.S. Obligations shall be the
sole source of collateral securing the Notes. Any portion of the Defeasance Deposit in excess of
the amount necessary to purchase the U.S. Obligations required by the preceding paragraph and to
otherwise satisfy the applicable Borrower’s obligations under this Exhibit J shall be
remitted to the applicable Borrower with the release of the Defeased Project from the lien of the
applicable Mortgages. In connection with such release, a successor entity meeting Administrative
Agent’s Single Purpose Entity criteria, adjusted, as applicable, for the Defeasance contemplated by
this Exhibit J (the “Successor Borrower”), shall be established by the applicable
Borrower subject to Administrative Agent’s approval (or at Administrative Agent’s option, by
Administrative Agent) and the applicable Borrower shall transfer and assign all of its obligations,
rights and duties under and to the Notes together with the pledged U.S. Obligations to such
Successor Borrower pursuant to an assignment and assumption agreement in form and substance
satisfactory to Administrative Agent (the “Assignment Agreement”). Such Successor Borrower
shall assume the obligations under the Notes and the Security Agreement and the applicable Borrower
shall be relieved of its obligations thereunder, except that the applicable Borrower

 

 

shall be
required to perform its obligations pursuant to this Exhibit J, including maintenance of
the Successor Borrower, if applicable. The applicable Borrower shall pay $1,000.00 to any such
Successor Borrower as consideration for assuming the obligations under the Note and the Security
Agreement pursuant to the Assignment Agreement. Notwithstanding anything in the relevant Mortgages
to the contrary, no other assumption fee shall be payable upon a transfer of the Notes in
accordance with this paragraph, but the applicable Borrower shall pay all costs and expenses
incurred by Administrative Agent in connection with this Exhibit J, including
Administrative Agent’s reasonable attorneys’ fees and expenses, cost and expenses in obtaining
review and confirmation by the applicable Rating Agencies as required herein, and any
administrative and tax expenses associated with or incurred by the Successor Borrower.

3. For purposes of this Exhibit J, the following terms shall have the following meanings:

     (a) The term “Defeasance Deposit” shall mean an amount equal to the Yield Maintenance
Amount, any costs and expenses incurred or to be incurred in the purchase of U.S. Obligations
necessary to meet the Scheduled Defeasance Payments (including Administrative Agent’s estimate of
administrative expenses and applicable federal income taxes associated with or to be incurred by
the Successor Borrower during the remaining term of, and applicable to, the Loans) and any revenue,
documentary stamp or intangible taxes or any other tax or charge due in connection with the
transfer of the Note or otherwise required to accomplish the agreements of this Exhibit J.

     (b) The term “Yield Maintenance Amount” shall mean the amount which will be sufficient
to purchase U.S. Obligations providing the required Scheduled Defeasance Payments; and

     (c) The term “U.S. Obligations” shall mean “Government Securities” as defined
in the REMIC regulations, specifically, Treasury Regulation § 1.860G-2(a)(8)(i).

 

 

SCHEDULE 1

COMMITMENTS

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Total
	Lender	 	A Note	 	B Note	 	C Note	 	Commitment
	General Electric Capital Corporation

	 	$321,442,000	 	 	$69,558,000	 	 	20,000,000	 	 	$411,000,000, with
a Maximum Loan
Amount not to
exceed $391,000,000
at any time

 

 

SCHEDULE 2.1

ADVANCE CONDITIONS

Part A — Initial Advance

Part B — Conditions to Additional Advances

Part C — General Conditions to all Advances

Part D — Capital Improvements Advances

PART A. CONDITIONS TO INITIAL ADVANCE.

     The initial advance of the Loans shall be subject to Administrative Agent’s receipt, review,
approval and/or confirmation of the following, at Borrowers’ cost and expense, each in form and
content satisfactory to Administrative Agent in its sole discretion:

1. The Loan Documents, executed by Borrowers and, as applicable, each Guarantor.

2. The commitment fee for the Note A Loans and Note B Loans in the aggregate amount of $2,782,500
in cash.

3. The commitment fee for the Note C Loans in the amount of $150,000 in cash.

4. An ALTA (or equivalent) mortgagee policy or policies of title insurance in an amount equal to,
for each Mortgage, the maximum Allocated Loan Amount(s) for the Project(s) in question assuming all
Additional Advances are made (so long as a tie-in endorsement shall be available, otherwise in an
amount equal to the Allocated Loan Amount(s) for the Projects in question assuming all Additional
Advances are made). Each such policy shall be issued together with such reinsurance and
endorsements as Administrative Agent may require, contain no exceptions to title (printed or
otherwise) which are unacceptable to Administrative Agent, and insure that the applicable First
Mortgage and Second Mortgage are first and second priority Liens, respectively, subject to
Permitted Encumbrances on the applicable Project and related collateral. Without limitation, each
such policy shall (a) be in the 1970 ALTA (revised 10-17-84) form or, if not available, ALTA 1992
form (deleting arbitration and creditors’ rights, if permissible) or, if not available, the form
commonly used in the state where the property is located, insuring Administrative Agent (on behalf
of the Lenders) or any and its successors and assigns; and (b) include the following endorsements
and/or affirmative coverages: (1) ALTA 9 Comprehensive, (2) Survey, (3) ALTA 3.1 Zoning (with
additional coverage for number and type of parking spaces), (4) Usury, (5) Doing Business, (6)
Access, (7) Separate Tax Lot, (8) Environmental Protection Lien, (9) Subdivision, (10) Contiguity,
(11) Tax Deed (as applicable), (12) Mortgage Recording Tax (as applicable), (13) Tie-In, (14) First
Loss, (15) Last Dollar, (16) Variable Rate and (17) Multiple Foreclosure.

5. All documents evidencing the formation, organization, valid existence, good standing, and due
authorization of and for each Borrower and each Guarantor for the execution, delivery, and
performance of the Loan Documents by each Borrower and each Guarantor.

 

 

6. Legal opinions issued by counsel for each Borrower and each Guarantor, opining as to the due
organization, valid existence and good standing of each Borrower and each Guarantor, and the due
authorization, execution, delivery, enforceability and validity of the Loan Documents with respect
to, each Borrower and each Guarantor; that the Loans, as reflected in the Loan Documents is not
usurious; to the extent that Administrative Agent is not otherwise satisfied, that the Projects and
their use are in full compliance with all legal requirements; that the Loan Documents do not create
or constitute a partnership, a joint venture or a trust or fiduciary relationship between any
Borrower and Administrative Agent; and as to such other matters as Administrative Agent and
Administrative Agent’s counsel reasonably may specify.

7. Current Uniform Commercial Code searches, and litigation, bankruptcy, tax lien and judgment
reports as requested by Administrative Agent, with respect to each Borrower, each Borrower’s
general partners, managing members, trustees, and principals, and the immediately preceding owner
of each Project.

8. Evidence of insurance as required by this Agreement, and conforming in all respects to the
requirements of Administrative Agent.

9. A current “as-built” survey of each Project, dated or updated to a date not earlier than thirty
(30) days prior to the date hereof, certified to Administrative Agent and the Lenders and their
successors and assigns and such title insurer, prepared by a licensed surveyor acceptable to
Administrative Agent and the issuer of the title insurance, and conforming to Administrative
Agent’s current standard survey requirements.

10. A current engineering report or architect’s certificate with respect to each Project, covering,
among other matters, inspection of heating and cooling systems, roof and structural details and
showing no failure of compliance with building plans and specifications, applicable legal
requirements (including requirements of the Americans with Disabilities Act) and fire, safety and
health standards. As requested by Administrative Agent, such report shall also include an
assessment of the Project’s tolerance for earthquake and seismic activity.

11. A current Site Assessment for each Project.

12. All appraisals, environmental reports, building condition reports and Site Assessments
delivered to Administrative Agent and the Lenders prior to the execution of this Agreement shall be
certified to Administrative Agent (on behalf of the Lenders and their successors and assigns)
without modification or change thereto in the form reasonably requested by the Administrative Agent
which may include certification to additional participants, co-lenders and/or investors in a
Secondary Market Transaction.

13. A current rent roll of each Project, certified by the Borrower owning such Project. Such rent
roll shall include the following information: (a) tenant names; (b) unit/suite numbers; (c) area of
each demised premises and total area of such Project (stated in net rentable square feet); (d)
rental rate (including escalations); (e) Lease term (commencement, expiration and renewal options);
(f) expense pass-throughs; (g) cancellation/termination provisions; and (h) security deposit. In
addition, each Borrower shall provide Administrative Agent with a copy of the standard Lease form
to be used by such Borrower in leasing space in such Borrower’s Project(s), and, at Administrative
Agent’s request, true and correct copies of all Leases of such Project(s).

 

 

14. A copy of the Management Agreement for each Project, certified by the Borrower owning the
relevant Project as being true, correct and complete.

15. Borrowers’ deposit with Administrative Agent of the amount required by Administrative Agent to
impound for taxes and assessments under Article 4 and to fund any other required escrows or
reserves.

16. Evidence that each Project and the operation thereof comply with all legal requirements,
including that all requisite certificates of occupancy, building permits, and other licenses,
certificates, approvals or consents required of any governmental authority have been issued without
variance or condition and that there is no litigation, action, citation, injunctive proceedings, or
like matter pending or threatened with respect to the validity of such matters. At Administrative
Agent’s request, Borrowers shall furnish Administrative Agent with a zoning endorsement to
Administrative Agent’s title insurance policy, zoning letters from applicable municipal agencies,
and utility letters from applicable service providers.

17. No change shall have occurred in the financial condition of any Borrower or any Guarantor or in
the Net Operating Income of any Project, which would have, in Administrative Agent’s judgment, a
material adverse effect on any Project or on any Borrower’s or any Guarantor’s ability to repay the
Loans or otherwise perform its obligations under the Loan Documents.

18. No condemnation or adverse zoning or usage change proceeding shall have occurred or shall have
been threatened against any Project; no Project shall have suffered any significant damage by fire
or other casualty that has not been repaired; no law, regulation, ordinance, moratorium, injunctive
proceeding, restriction, litigation, action, citation or similar proceeding or matter shall have
been enacted, adopted, or threatened by any governmental authority, which would have, in
Administrative Agent’s judgment, a material adverse effect on any Borrower, any Guarantor or any
Project.

19. On the date of the Initial Advance, the annualized Adjusted Net Operating Income equals or
exceeds $27,785,000; the Cash on Cash Return is at least 7.5%; the Debt Service Coverage is at
least 1.22:1; and the LTV is not more than 85% (based on the lesser of actual or market occupancy),
each as determined by Administrative Agent in its sole discretion.

20. All fees and commissions payable to real estate brokers, mortgage brokers, or any other brokers
or agents in connection with the Loans or the acquisition of each Project have been paid, such
evidence to be accompanied by any waivers or indemnifications deemed necessary by Administrative
Agent.

21. Borrowers’ unreturned cash investment in the (equity) is at least $27,500,000.

22. Payment of Administrative Agent’s costs and expenses in underwriting, documenting, and closing
the transaction, including fees and expenses of Administrative Agent’s inspecting engineers,
consultants, and outside counsel.

23. Amendments to the existing Loan Documents, and such other documents or items as Administrative
Agent or its counsel reasonably may require.

 

 

24. The representations and warranties contained in this Loan Agreement and in all other Loan
Documents are true and correct.

25. No Potential Default or Event of Default shall have occurred or exist.

PART B. CONDITIONS TO ADDITIONAL ADVANCE

Additional Advances of the Loans following the initial advance shall be available only during the
first four (4) Loan Years and are subject to Administrative Agent’s receipt, review, approval
and/or confirmation of the following, each in form and content satisfactory to Administrative Agent
in its sole discretion:

1. If, after giving effect to the Additional Advance and after giving effect to previous repayments
of the Loans in connection with a Partial Release of a Project, and the Additional Advance occurs
(a) during the first Loan Year, the Cash on Cash Return is at least 7.75%, the Debt Service
Coverage is at least 1.30:1.00, and LTV is at least 85%, (b) during the second Loan Year, the Cash
on Cash Return is at least 8.00%, the Debt Service Coverage is at least 1.35:1.00, and LTV is at
least 83%, (c) during the third Loan Year, the Cash on Cash Return is at least 8.25%, the Debt
Service Coverage is at least 1.40:1.00, and LTV is at least 81%, and (d) during the fourth Loan
Year, the Cash on Cash Return is at least 8.50%, the Debt Service Coverage is at least 1.45:1.00,
and LTV is at least 79%.

2. The Contract Rate for the Additional Advance shall be based on a Treasury Rate at the time of
the funding of the Additional Advance plus one and one-half percent (1.5%). Borrowers may
request Administrative Agent to rate lock prior to the actual funding date of any Additional
Advance but such request will be subject to terms and conditions satisfactory to Administrative
Agent in its sole discretion, including but not limited to: (a) Administrative Agent’s
satisfaction as to the amount of any Additional Advance including Borrowers’ satisfaction of the
conditions set forth in paragraph 1 above; (b) Borrowers shall have executed such documentation
required by Administrative Agent setting forth the terms and conditions of such rate lock
including, but not limited to (i) the term of the rate lock and (ii) the required amount to be
deposited by Borrowers to Administrative Agent to cover Administrative Agent’s hedge losses and
costs; and (c) Borrowers shall pay all of Administrative Agent’s out-of-pocket costs related to any
such rate lock.

3. On the date that such Additional Advance is funded, Administrative Agent receives a payment
which in an amount equal to 0.75% of the amount of the Additional Advance.

4. Administrative Agent shall have received from Borrowers with respect to the matters referred to
in clauses 1. (a) statement of the Net Operating Income and Debt Service and (b) based on the
foregoing statements of Net Operating Income and Debt Service, calculations of the Debt Service
Coverage, Cash on Cash Return and LTV accompanied by an officer’s certificate that such statements,
calculations and information are true, correct and complete in all material respects.

PART C. GENERAL CONDITIONS TO ALL ADVANCES

Each advance of the Loans following the initial advance shall be subject to Administrative Agent’s
receipt, review, approval and/or confirmation of the following, each in form and content
satisfactory to Administrative Agent in its sole discretion:

 

 

1. There shall exist no Potential Default or Event of Default (currently and after giving effect to
the requested advance).

2. The representations and warranties contained in this Loan Agreement and in all other Loan
Documents are true and correct.

3. Such advance shall be secured by the Loan Documents, subject only to those exceptions to title
approved by Administrative Agent at the time of Loan closing, as evidenced by title insurance
endorsements satisfactory to Administrative Agent.

4. Borrowers shall have paid Administrative Agent’s costs and expenses in connection with such
advance (including title charges, and costs and expenses of Administrative Agent’s inspecting
engineer and attorneys).

5. No change shall have occurred in the financial condition of the Borrowers or any Guarantor, or
in the Net Operating Income of the Projects, which would have, in Administrative Agent’s judgment,
a material adverse effect on the Loans, the Projects, or any Borrower’s or any Guarantor’s ability
to perform their respective obligations under the Loan Documents.

6. No condemnation or adverse, as determined by Administrative Agent, zoning or usage change
proceeding shall have occurred or shall have been threatened against any Project; no Project shall
have suffered any damage by fire or other casualty that has not been repaired or is not being
restored in accordance with this Agreement; no law, regulation, ordinance, moratorium, injunctive
proceeding, restriction, litigation, action, citation or similar proceeding or matter shall have
been enacted, adopted, or threatened by any governmental authority, which would have, in
Administrative Agent’s judgment, a material adverse effect on any Project or any Borrower’s or any
Borrower Party’s ability to perform its obligations under the Loan Documents.

7. At the option of Administrative Agent (i) each advance request shall be submitted to
Administrative Agent at least ten (10) Business Days prior to the date of the requested advance;
and (ii) all advances shall be made at the New York office of Administrative Agent or at such other
place as Administrative Agent may designate unless Administrative Agent exercises its option to
make an advance directly to the Person to whom payment is due.

PART D. CAPITAL IMPROVEMENTS ADVANCES

Additional advances shall be made from the Capital Improvements Reserve no more than once per
calendar month to finance capital improvements on the following terms and conditions:

1. Each request for such an advance shall specify the amount requested (in minimum amounts of
$10,000 per month), shall be on forms satisfactory to Administrative Agent, and shall be
accompanied by appropriate invoices, bills paid affidavits, lien waivers, title updates,
endorsements to the title insurance, and other documents as may be required by Administrative
Agent. Such advances may be made to the extent that there are available funds in the Capital
Improvements Reserve at Administrative Agent’s election, either: (a) in reimbursement for expenses
paid by a Borrower, or (b) for payment of expenses incurred and invoiced but not yet paid by a
Borrower. Administrative Agent, at its option and without further direction from any Borrower, may
disburse any improvements advance to the Person to whom payment is due or through an escrow
satisfactory to Administrative Agent. Each Borrower hereby irrevocably

 

 

directs and authorizes
Administrative Agent so to advance the proceeds of the Capital Improvements Reserve, if any.
Administrative Agent may, at the each Borrower’s expense, conduct an audit, inspection, or review
of the Project(s) owned by such Borrower to confirm the amount of the requested improvements
advance.

2. Each Borrower shall have submitted and Administrative Agent shall have approved (a) the
improvements to be constructed at its Project(s), (b) the plans and specifications for such
improvements, which plans and specifications may not be changed without Administrative Agent’s
prior written consent, and (c) if requested by Administrative Agent, each contract or subcontract
for an amount in excess of $25,000.00 for the performance of labor or the furnishing of materials
for such improvements.

3. Each Borrower shall have submitted and Administrative Agent shall have approved the time
schedule for completing the capital improvements for its Project(s). After Administrative Agent’s
approval of any such detailed budget, such budget may not be changed without Administrative Agent’s
prior written consent. If the estimated cost of the improvements for any Project exceeds the
unadvanced portion of the amount allocated for such improvements at such Project in the approved
budget, then the applicable Borrower shall provide such security as Administrative Agent may
require to assure the lien-free completion of improvements before the scheduled completion date.

4. All improvements constructed by any Borrower prior to the date an improvements advance is
requested shall be completed to the satisfaction of Administrative Agent and Administrative Agent’s
engineer and in accordance with the plans and budget for such improvements, as approved by
Administrative Agent, and all legal requirements.

5. In the event that any capital improvements advance is to be used to pay for tenant improvements
under a commercial lease only, in addition to the other advance conditions herein, advance of funds
shall also be conditioned upon: (i) the tenant being required to take occupancy of the subject
space pursuant to a Lease; (ii) such tenant having accepted such space; (iii) such tenant having
paid all Rent and other sums due under the Lease; and (iv) such tenant having executed and
delivered to Administrative Agent a tenant estoppel certificate affirming all of the foregoing and
such other matters as Administrative Agent may reasonably require.

6. No Borrower shall use any portion of any improvements advance for payment of any other cost
except as specifically set forth in a request for advance approved by Administrative Agent in
writing.

7. Each improvements advance, except for a final improvements advance, shall be in the amount of
actual costs incurred less ten percent (10%) of such costs as retainage to be advanced as
part of a final improvements advance.

8. Administrative Agent shall not under any circumstances be obligated to make any improvements
advance ninety (90) days before the Maturity Date.

9. No funds will be advanced for materials stored at any Project unless the applicable Borrower
furnishes Administrative Agent satisfactory evidence that such materials are properly stored and
secured at such Project.

 

 

SCHEDULE 2

GUARANTIES

	1.	 	Cross Collateralization Guaranty, dated as of November 30, 2005, by Tarragon Corporation.
	 
	2.	 	Guaranty of the Non-Recourse Exceptions, dated as of November 30, 2005, by Tarragon
Corporation.
	 
	3.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Autumn Ridge Apartments,
LLC.*
	 
	4.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Dogwood Hills
Apartments, LLC.*
	 
	5.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Forest Park Tarragon,
LLC.*
	 
	6.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Ansonia Acquisitions I,
LLC.*
	 
	7.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Hamden Centre
Apartments, LLC.*
	 
	8.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Ansonia Liberty, LLC.*
	 
	9.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Ocean Beach Apartments,
LLC.*
	 
	10.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by West Dale National
Associates, L.P.*
	 
	11.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Manchester Tarragon,
LLC.*
	 
	12.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Danforth Apartment
Owners, L.L.C.*
	 
	13.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Tarragon Huntsville
Apartments, L.L.C.*
	 
	14.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Heather Limited
Partnership.*
	 
	15.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Tarragon Savannah I,
L.L.C.*

 

			
	*	 	Secured Guaranties

 

 

	16.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Tarragon Savannah II,
L.L.C.*
	 
	17.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Heron Cove National,
Inc.*
	 
	18.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Vintage Legacy Lakes
National, L.P.*
	 
	19.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Plantation Bay
Apartments, L.L.C.*
	 
	20.	 	Secured Cross Collateral Guaranty, dated as of November 30, 2005, by Summit/Tarragon
Murfreesboro, L.L.C.*
	 
	21.	 	Unsecured Cross Collateral Guaranty, dated as of November 30, 2005, by Danforth Apartment
Owners, L.L.C.
	 
	22.	 	Unsecured Cross Collateral Guaranty, dated as of November 30, 2005, by Heather Limited
Partnership.
	 
	23.	 	Unsecured Cross Collateral Guaranty, dated as of November 30, 2005, by Heron Cove National,
Inc.
	 
	24.	 	Unsecured Cross Collateral Guaranty, dated as of November 30, 2005, by Plantation Bay
Apartments, L.L.C.
	 
	25.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Autumn Ridge Apartments,
LLC and Tarragon Corporation.
	 
	26.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Dogwood Hills
Apartments, LLC and Tarragon Corporation.
	 
	27.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Forest Park Tarragon,
LLC and Tarragon Corporation.
	 
	28.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Ansonia Acquisitions I,
LLC and Tarragon Corporation.
	 
	29.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Hamden Centre
Apartments, LLC and Tarragon Corporation.
	 
	30.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Ansonia Liberty, LLC and
Tarragon Corporation.
	 
	31.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Ocean Beach Apartments,
LLC and Tarragon Corporation.

 

			
	*	 	Secured Guaranties

 

 

	32.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by West Dale National
Associates, L.P. and Tarragon Corporation.
	 
	33.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Manchester Tarragon,
LLC. and Tarragon Corporation.
	 
	34.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Danforth Apartment
Owners, L.L.C. and Tarragon Corporation.
	 
	35.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Tarragon Huntsville
Apartments, L.L.C. and Tarragon Corporation.
	 
	36.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Heather Limited
Partnership. and Tarragon Corporation.
	 
	37.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Tarragon Savannah I,
L.L.C. and Tarragon Corporation.
	 
	38.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Tarragon Savannah II,
L.L.C. and Tarragon Corporation.
	 
	39.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Heron Cove National,
Inc. and Tarragon Corporation.
	 
	40.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Vintage Legacy Lakes
National, L.P. and Tarragon Corporation.
	 
	41.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Plantation Bay
Apartments, L.L.C. and Tarragon Corporation.
	 
	42.	 	Environmental Indemnity Agreement, dated as of November 30, 2005, by Summit/Tarragon
Murfreesboro, L.L.C. and Tarragon Corporation.

 

			
	*	 	Secured Guaranties

 

 

SCHEDULE 2.3.5

MAKE WHOLE BREAKAGE AMOUNT DEFINITION

The “Make Whole Breakage Amount” means the sum of present value on the date of prepayment
of each Monthly Interest Shortfall (as hereinafter defined) for the remaining term of the Loans
discounted at the Discount Rate (as hereinafter defined).

The “Monthly Interest Shortfall” will be calculated for each monthly Payment Date and means
the product of (1) the prepaid principal balance of the Loans divided by twelve (12), and (2) the
positive result, if any, from (a) the Treasury Rates used to calculate the Note A Interest Rates
and the Note B Interest Rates (plus a break contract fee of 20 basis points) minus (b) the
Replacement Treasury Rate (as hereinafter defined).

The “Discount Rate” will be the monthly compounded Replacement Treasury Rate.

The “Replacement Treasury Rate” will be the yield calculated by linear interpolation
(rounded to one-thousandth of one percent (i.e., .001%)) of the yields, as reported in Federal
Reserve Statistical Release H.15-Selected Interest Rates under the heading U.S. Government
Securities/Treasury Constant Maturities for the week ending prior to the prepayment date, of U.S.
Treasury Constant Maturities with terms (one longer and one shorter) most nearly approximating the
remaining Weighted Average Life of the Loans (as hereinafter defined) as of the prepayment date.
In the event Release H.15 is no longer published, Administrative Agent shall select a comparable
publication to determine the Replacement Treasury Rate.

The “Weighted Average Life of the Loans” will be determined as of the prepayment date by
(1) multiplying the amount of each monthly principal payment that would have been paid had the
prepayment not occurred by the number of months from the prepayment date to each Payment Date, (2)
adding the results, and (3) dividing the sum by the balance remaining on the Loans on the
prepayment date multiplied by twelve (12). If no monthly principal payments are required, the
Weighted Average Life of the Loans shall be the remaining term of the Loans as of the prepayment
date.

 

 

SCHEDULE 3.9.3

NORTHEAST PORTFOLIO PROJECTS

	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	State	 	County
	Autumn Ridge

	 	90 Gerrish Avenue

East Haven, CT 06512
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Dogwood Hills

	 	200 Evergreen Avenue

Hamden, CT 06518
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Forest Park Apartments

	 	108D West Street

Rocky Hill, CT 06067
	 	CT
	 	Hartford
	 
	 	 	 	 	 	 
	Groton Towers

	 	39 Broad Street Extension

Groton, CT 06340
	 	CT
	 	New London
	 
	 	 	 	 	 	 
	Hamden Center

	 	169 School Street

Hamden, CT 06518
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Lakeview Apartments

	 	440 Meriden Road

Waterbury, CT 06705
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	The Liberty Building

	 	152 Temple Street

New Haven, CT 06510
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Ocean Beach Apartments

	 	5 Nob Hill Road

New London, CT 06320
	 	CT
	 	New London
	 
	 	 	 	 	 	 
	Parkview Apartments

	 	270 Spring Street #5

Naugatuck, CT 06770
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Sagamore Hill

	 	1151-1189 Washington

St., B-2

Middletown, CT 06457
	 	CT
	 	Middlesex
	 
	 	 	 	 	 	 
	Nutmeg Woods

	 	84 Hawthorne Drive

New London, CT 06320
	 	CT	 	 
	 
	 	 	 	 	 	 
	Woodcliff Estates

	 	181 Nutmeg Lane

East Hartford, CT 06118
	 	CT
	 	Hartford
	 
	 	 	 	 	 	 
	200 Fountain-Exec House

	 	216 Fountain Street

New Haven, CT 06516
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	278 Main Street-Giannotti

	 	278 Main Street

West Haven, CT 06516
	 	CT
	 	New Haven
	 
	 	 	 	 	 	 
	Lofts at the Mills

	 	210 Pine Street

Manchester, CT 06040
	 	CT
	 	Hartford

 

 

	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	State	 	County
	 

	 	90 Elm Street

Manchester, CT 06040
	 	 	 	Hartford

 

 

SCHEDULE 4

PROJECTS

	 	 	 	 	 
	Property Name	 	Property Address	 	Owner
	Autumn Ridge

	 	90 Gerrish Avenue

East Haven, CT 06512
	 	Autumn Ridge
Apartments, a
Connecticut limited
liability company
	 
	 	 	 	 
	Dogwood Hills

	 	200 Evergreen Avenue

Hamden, CT 06518
	 	Dogwood Hills
Apartments, LLC, a
Connecticut limited
liability company
	 
	 	 	 	 
	Forest Park Apartments

	 	108D West Street

Rocky Hill, CT 06067
	 	Forest Park
Tarragon, LLC, a
Connecticut limited
liability company
	 
	 	 	 	 
	Groton Towers

	 	39 Broad Street Extension

Groton, CT 06340
	 	Ansonia
Acquisitions I,
LLC, a Connecticut
limited liability
company
	 
	 	 	 	 
	Hamden Center

	 	169 School Street

Hamden, CT 06518
	 	Hamden Centre
Apartments, LLC, a
Connecticut limited
liability company
	 
	 	 	 	 
	Lakeview Apartments

	 	440 Meriden Road

Waterbury, CT 06705
	 	Ansonia
Acquisitions I,
LLC, a Connecticut
limited liability
company
	 
	 	 	 	 
	The Liberty Building

	 	152 Temple Street

New Haven, CT 06510
	 	Ansonia Liberty,
LLC, a Connecticut
limited liability
company
	 
	 	 	 	 
	Ocean Beach Apartments

(fka Sandalwood)

	 	5 Nob Hill Road

New London, CT 06320
	 	Ocean Beach
Apartments LLC, a
Connecticut limited
liability company
	 
	 	 	 	 
	Parkview Apartments

	 	270 Spring Street #5

Naugatuck, CT 06770
	 	Ansonia
Acquisitions I,
LLC, a Connecticut
limited liability
company
	 
	 	 	 	 
	Sagamore Hill

	 	1151-1189 Washington

St., B-2

Middletown, CT 06457
	 	Ansonia
Acquisitions I,
LLC, a Connecticut
limited liability
company
	 
	 	 	 	 
	Nutmeg Woods

	 	84 Hawthorne Drive

New London, CT 06320
	 	Ansonia
Acquisitions I,
LLC, a Connecticut
limited liability
company
	 
	 	 	 	 
	Woodcliff Estates

	 	181 Nutmeg Lane

East Hartford, CT 06118
	 	Ansonia
Acquisitions I,
LLC, a Connecticut
limited liability
company
	 
	 	 	 	 
	200 Fountain-Exec House

	 	216 Fountain Street

New Haven, CT 06516
	 	West Dale National
Associates, L.P., a
Texas limited
partnership
	 
	 	 	 	 
	278 Main Street-Giannotti

	 	278 Main Street

West Haven, CT 06516
	 	Manchester
Tarragon, LLC, a
Connecticut limited
liability company

 

 

	 	 	 	 	 
	Property Name	 	Property Address	 	Owner
	Lofts at the Mills

	 	210 Pine Street

Manchester, CT 06040
	 	Manchester
Tarragon, LLC, a
Connecticut limited
liability company
	 
	 	 	 	 
	 

	 	91 Elm Street

Manchester, CT 06040
	 	Danforth Apartment
Owners, L.L.C., a
Florida limited
liability company
	 
	 	 	 	 
	Club at Danforth

	 	3701 Danforth Drive

Jacksonville, FL 32224
	 	Tarragon Huntsville
Apartments, L.L.C.,
an Alabama limited
liability company
	 
	 	 	 	 
	Vintage at Madison Crossing

	 	7584 Old Madison Pike

Huntsville, AL 35806
	 	Heather Limited
Partnership, a
Maryland limited
partnership
	 
	 	 	 	 
	Heather Hill

	 	5837 Fisher Road

Temple Hills, MD 20748
	 	Tarragon Savannah
I, L.L.C. and
Tarragon Savannah
II, L.L.C., each a
Georgia limited
liability company
	 
	 	 	 	 
	The Links at Georgetown

	 	Phase I & II

450 Al Henderson Blvd.

Savannah, GA 31419
	 	Heron Cove
National, Inc., a
Florida corporation
	 
	 	 	 	 
	River City Landing

	 	2681 University Blvd.

Jacksonville, FL 32211
	 	Vintage Legacy
Lakes National,
L.P., a Texas
limited partnership
	 
	 	 	 	 
	The Vintage at Legacy

	 	3700 Legacy Drive

Frisco, TX 75034
	 	Plantation Bay
Apartments, L.L.C.,
a Florida limited
liability company
	 
	 	 	 	 
	The Vintage at Plantation 

Bay

	 	7740 Plantation Bay Drive

Jacksonville, FL 32244
	 	Summit/Tarragon
Murfreesboro,
L.L.C., a Tennessee
limited liability
company
	 
	 	 	 	 
	Vintage at the Parke

(fka Vintage @ Barfield)

	 	261 Barfield Crescent

Road

Murfreesboro, TN 37129
	 	Dogwood Hills
Apartments, LLC, a
Connecticut limited
liability company

 

 

SCHEDULE 5.3.4

LEAD BASED PAINT PROJECTS

	1.	 	Hamden Centre
	 
	2.	 	200 Fountain

 

 

SCHEDULE 5.3.5

O&M PLAN PROJECTS

	1.	 	200 Fountain-Executive House
	 
	2.	 	Autumn Ridge
	 
	3.	 	Dogwood Hills
	 
	4.	 	Forest Park
	 
	5.	 	Groton Towers
	 
	6.	 	Hamden Centre
	 
	7.	 	Heather Hill
	 
	8.	 	Lofts at the Mills
	 
	9.	 	Ocean Beach
	 
	10.	 	Parkview
	 
	11.	 	River City
	 
	12.	 	Sagamore Hills
	 
	13.	 	278 Main Street-Gianotti
	 
	14.	 	Nutmeg Woods
	 
	15.	 	Woodcliff Estates
	 
	16.	 	The Liberty Building

 

 

SCHEDULE 5.3.6

UST PROJECTS

	1.	 	Groton Towers — tightness testing
	 
	2.	 	Ocean Beach — tightness testing
	 
	3.	 	Nutmeg Woods — tightness testing
	 
	4.	 	Forest Park — remove two (2) 55-gallon drums

 

 

SCHEDULE 5.3.7

PHASE II PROJECTS

	1.	 	Parkview

 

 

SCHEDULE 9.14

REQUIRED REPAIRS

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Immediate	 	Capital	 	 
	 	 	# of	 	Repairs	 	Improvement	 	 
	Property	 	Units	 	HoldBack	 	Holdback	 	Total
	 
	AUTUMN RIDGE
	 	 	116	 	 	 	30,750	 	 	 	 	 	 	 	30,750	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	DOGWOOD HILLS
	 	 	46	 	 	 	6,800	 	 	 	 	 	 	 	6,800	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	FOREST PARK APARTMENTS
	 	 	161	 	 	 	63,123	 	 	 	 	 	 	 	63,123	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	GROTON TOWERS
	 	 	114	 	 	 	7,000	 	 	 	 	 	 	 	7,000	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	HAMDEN CENTRE
	 	 	65	 	 	 	6,250	 	 	 	 	 	 	 	6,250	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	LAKEVIEW APARTMENTS
	 	 	88	 	 	 	1,500	 	 	 	 	 	 	 	1,500	 
	THE LIBERTY BUILDING
	 	 	123	 	 	 	—	 	 	 	 	 	 	 	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	OCEAN BEACH APARTMENTS
	 	 	455	 	 	 	13,325	 	 	 	 	 	 	 	13,325	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	PARKVIEW APARTMENTS
	 	 	160	 	 	 	9,420	 	 	 	 	 	 	 	9,420	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	SAGAMORE HILLS
	 	 	212	 	 	 	9,000	 	 	 	 	 	 	 	9,000	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	WHALERS-NUTMEG
	 	 	382	 	 	 	64,175	 	 	 	 	 	 	 	64,175	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	WOODCLIFF ESTATES
	 	 	561	 	 	 	36,500	 	 	 	 	 	 	 	36,500	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	200 FOUNTAIN-EXEC HOUSE
	 	 	166	 	 	 	6,250	 	 	 	 	 	 	 	6,250	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	278 MAIN STREET-GIANNOTTI
	 	 	99	 	 	 	2,100	 	 	 	 	 	 	 	2,100	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	LOFTS AT THE MILLS
	 	 	411	 	 	 	3,500	 	 	 	890,000	 	 	 	893,500	 
	THE CLUB AT DANFORTH
	 	 	288	 	 	 	—	 	 	 	 	 	 	 	—	 
	VINTAGE AT MADISON CROSSING
	 	 	178	 	 	 	 	 	 	 	 	 	 	 	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	HEATHER HILL
	 	 	459	 	 	 	113,575	 	 	 	 	 	 	 	113,575	 
	THE LINKS AT GEORGETOWN
	 	 	360	 	 	 	—	 	 	 	 	 	 	 	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	RIVER CITY LANDING
	 	 	352	 	 	 	821,955	 	 	 	 	 	 	 	821,955	 
	THE VINTAGE AT LEGACY
	 	 	320	 	 	 	—	 	 	 	 	 	 	 	—	 
	THE VINTAGE AT PLANTATION BAY
	 	 	240	 	 	 	—	 	 	 	 	 	 	 	—	 
	VINTAGE AT THE PARK
	 	 	278	 	 	 	—	 	 	 	 	 	 	 	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total
	 	 	5,634	 	 	 	1,195,223	 	 	 	890,000	 	 	 	2,085,223	 

THE REQUIRED REPAIRS ARE DETAILED ON THE 24 PAGES ATTACHED HERETO, EACH ENTITLED “OPINIONS
OF PROBABLE COSTS”. IN THE EVENT OF ANY CONFLICT BETWEEN THE AMOUNTS SET FORTH ON THE SCHEDULE
ABOVE AND THE AMOUNTS SET FORTH IN THE ATTACHED “OPINIONS OF PROBABLE COSTS”, THE AMOUNTS SET FORTH
IN THE SCHEDULE ABOVE SHALL BE CONTROLLING.

 

 

SCHEDULE 9.17

POST CLOSING OBLIGATIONS

1. Within thirty (30) days from the date hereof, obtain Subordination, Non-disturbance and
Attornment Agreements in the form previously provided to Borrowers by Administrative Agent (with
such modifications thereto as may be approved by Administrative Agent) from each laundry room
lessee at the Projects.

2. Within thirty (30) days from the date hereof, obtain a new or updated ALTA/ACSM survey of the
Project known as “210 Pine Street” in Connecticut, which survey shall contain a certificate
substantially in the form delivered to Administrative Agent in connection with the surveys obtained
by Administrative Agent with respect to the other Projects on the Closing Date and shall otherwise
be in form and substance acceptable to Administrative Agent.

3. Within the statutorily prescribed period following its qualification to do business in the State
of Alabama, cause to be filed with the Alabama Department of Revenue a PPT Alabama Business
Privilege Tax Return and Annual Report for Ansonia MezzCo, a Delaware limited liability company.

4. Within thirty (30) days from the date hereof, obtain a revised ALTA/ACSM survey of the Project
known as “Vintage at Plantation Bay” in Connecticut, which survey shall contain a certificate
substantially in the form delivered to Administrative Agent in connection with the surveys obtained
by Administrative Agent with respect to the other Projects on the Closing Date and shall otherwise
be in form and substance acceptable to Administrative Agent.

5. Within sixty (60) days from the date hereof, cause to be release or terminated that certain
UCC-1 Financing Statement No. 0002103119, naming Prudential Mortgage Capital Funding, LLC, filed
with the Connecticut Secretary of State on November 6, 2001.exv10w17

 

Exhibit 10.17

FIRST AMENDMENT TO LOAN AGREEMENT

AND OMNIBUS AMENDMENT AND REAFFIRMATION OF LOAN DOCUMENTS

     THIS FIRST AMENDMENT TO LOAN AGREEMENT AND OMNIBUS AMENDMENT AND REAFFIRMATION OF LOAN
DOCUMENTS (this “Amendment”) is made and entered into as of June 30, 2006, by and among
each of the entities that is a signatory hereto identified under the caption “BORROWERS” on the
signature pages hereof (individually, a “Borrower” and, collectively, the
“Borrowers”); each of the lenders that is a signatory hereto identified under the caption
“LENDERS” on the signature pages hereof and each lender that becomes a “Lender” hereunder after the
date hereof (individually, a “Lender” and, collectively, the “Lenders”); and
GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation, as administrative agent for the
Lenders (in such capacity, together with its successors in such capacity, “Administrative
Agent”).

RECITALS

     WHEREAS, Borrowers, Administrative Agent, and the Lenders are parties to a Loan Agreement
dated as of November 30, 2005 (said Loan Agreement, as amended, modified and supplemented hereby
and as the same may be amended, modified and supplemented and in effect from time to time in the
future, being herein called the “Loan Agreement”), which Loan Agreement provides, among
other things, for Loans to be made by the Lenders to Borrowers in an aggregate principal amount not
exceeding $391,000,000 upon and subject to the terms and conditions set forth therein; and

     WHEREAS, the Borrowers, the Lenders and Administrative Agent desire to amend the Loan
Agreement as more fully set forth herein.

AGREEMENT

     NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants, conditions and
agreements herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Borrowers, Administrative Agent, and the Lenders
agree as follows:

     1. Definitions. Except as otherwise herein expressly provided, all capitalized terms
used herein shall have the meanings assigned to such terms in the Loan Agreement.

     2. Increased Loan Amount. Subject to the terms and conditions of this Amendment, the
Lenders hereby agree to increase the total Commitments by the amount of $20,000,000, to a total
aggregate principal amount of the Commitments not to exceed $411,000,000.

     3. Modifications to Loan Documents. The Loan Agreement and the other Loan Documents
are hereby amended, modified and supplemented as follows:

1

 

A. Definitions.

     (i) The following definitions in the Loan Agreement are hereby amended and restated in
their entirety as follows:

“‘Alternate Base Rate’ means (a) with respect to the Note C Loans,
for any day, a rate per annum equal to the Prime Rate in effect for such day
plus one and eight tenths percent (1.8%) per annum and (b) with respect to
Note D Loans, for any day, a rate per annum equal to the Prime Rate in
effect for such day plus six and two tenths percent (6.2%) per annum.”

“‘Alternate Base Rate Loans’ means the Note C Loans and/or the Note
D Loans that bear interest at rates based upon the Alternate Base Rate.”

“‘Cash Flow Sweep Event’ means, at any time (a) during the first
Loan Year (i) Cash on Cash Return is less than six and six-tenths percent
(6.60%) or (ii) Debt Service Coverage is less than 1.03:1; (b) during the
second Loan Year (i) Cash on Cash Return is less than seven and one-tenths
percent (7.10%) or (ii) Debt Service Coverage is less than 1.05:1; (c)
during the third Loan Year (i) Cash on Cash Return is less than seven and
three-quarters percent (7.75%) or (ii) Debt Service Coverage is less than
1.10:1; (d) during the fourth Loan Year (i) Cash on Cash Return is less than
eight and one-half of one-tenth percent (8.05%) or (ii) Debt Service
Coverage is less than 1.15:1, or (e) during the fifth Loan Year (i) Cash on
Cash Return is less than eight and thirty-five one hundredths percent
(8.35%) or (ii) Debt Service Coverage is less than 1.17:1. For purposes of
determining a Cash Flow Sweep Event, in determining the Cash on Cash Return
and the Debt Service Coverage Ratio Net Operating Income shall be increased
by the amount of funds in the Note D Debt Service Reserve.”

“‘Cash Sweep Release’ means, at any time after the occurrence of a
Cash Flow Sweep Event, that the Cash on Cash Return and Debt Service
Coverage Ratio is equal to the greater of (a) (i) Cash on Cash Return of at
least seven percent (7.0%) and (ii) Debt Service Coverage of at least
1.05:1, and (b) the levels identified for the applicable Loan Year in the
definition of Cash Flow Sweep Event for a period of at least six (6)
consecutive months.”

“‘Commitment’ means, as to each Lender, the obligation of such
Lender to make Loans in the aggregate principal amount up to but not
exceeding the amount set opposite the name of such Lender on Schedule
1 under the caption “Commitment” or, in the case of a Person that
becomes a Lender pursuant to an assignment permitted under Section
12.27.2, as specified in the respective instrument of assignment
pursuant to which such assignment is effected. The original aggregate
principal amount of the Commitments is $411,000,000.00.”

2

 

“‘Contract Rate’ means, (a) with respect to the Note A Loans, the
Note A Interest Rate, (b) with respect to the Note B Loans, the Note B
Interest Rate, (c) with respect to the Note C Loans, the Note C Interest
Rate, and (d) with respect to the Note D Loans, the Note D Interest Rate.”

“‘Guarantors’ means the Persons, if any, executing a Guaranty,
including Borrowers and, with respect to the Carve-out Guaranty only,
Tarragon and William S. Friedman.”

“‘Libor-based Loans’ means Loans evidenced by Note C and/or Loans
evidenced by Note D that bear interest at rates based on rates referred to
in the definition of ‘Libor-based Rate.’”

“‘Libor-based Rate’ means the U.S. Dollar rate (rounded upward to
the nearest one-one hundredth of one percent) listed on page 3750
(i.e., the Libor page) of the Telerate News Services titled
“British Banker Association Interest Settlement Rates” for a
designated maturity of one (1) month determined as of 11:00 a.m. London Time
on the second (2nd) full Eurodollar Business Day next preceding the first
day of each month with respect to which interest is payable under (a) the
Loans attributable to Note C or (b) the Loans attributable to Note D (unless
such date is not a Business Day in which event the next succeeding Business
Day will be used). If the Telerate News Services (i) publishes more than
one (1) such Libor-based Rate, the average of such rates shall apply, or
(ii) ceases to publish the Libor-based Rate, then the Libor-based Rate shall
be determined from such substitute financial reporting service as Lender in
its discretion, shall determine. “Eurodollar Business Day” means
any day on which banks in the City of London are generally open for
interbank or foreign exchange transactions.”

“‘Loans’ means, collectively, the Note A and Note B Loans, the Note
C Loans and the Note D Loans made by the Lenders to Borrowers under this
Agreement, and all other amounts secured by the Loan Documents.”

“‘Maximum Loan Amount’ means the amount of Four Hundred Eleven
Million Dollars and No/100s ($411,000,000).”

“‘Notes’ means collectively, each Note A, each Note B and each Note
C dated as of November 30, 2005 and each Note D dated as of June 30, 2006,
as provided for in Section 2.1.4, and all promissory notes delivered
in substitution or exchange therefor, in each case as the same may be
consolidated, replaced, severed, modified, amended or extended from time to
time.”

     (ii) The following new definitions are hereby added to the Loan Agreement as follows:

“‘Account Collateral’ has the meaning assigned in Section
3.2.3.”

3

 

“‘Lockbox Account’ has the meaning assigned in Section
3.2.1.”

“‘Lockbox Agreement’ means each Lockbox Agreement by and among
Borrower, Administrative Agent and the Lockbox Bank pertaining to a Lockbox
Account, as same may be modified or amended from time to time. Each such
Lockbox Agreement shall be substantially in the form of Exhibit C
attached hereto, with such modifications thereto as Administrative Agent may
approve.”

“‘Lockbox Bank’ means a depository institution insured by the
Federal Deposit Insurance Corporation and otherwise reasonably acceptable to
Administrative Agent.”

“‘Note D’ means, collectively, those certain notes or note
denominated “Note D” dated as of June 30, 2006, executed by each Borrower to
the order of the Lender named therein, in the aggregate original principal
amount of $20,000,000, as the same may be consolidated, replaced, severed,
modified, amended or extended from time to time. Each Note D shall
constitute a “Note” for all purposes under the Loan Agreement and the other
Loan Documents.”

“‘Note D Debt Service Reserve’ has the meaning assigned in
Section 2.1.1(e).”

“‘Note D Interest Rate’ means, with respect to Loans evidenced by
Note D, a rate of interest per annum equal to eight and nine-tenths percent
(8.90%) in excess of the Libor-based Rate, provided however, that, subject
to the provisions of Section 2.7, at such time that the Loans
evidenced by Note D are Alternate Base Rate Loans, the interest rate for
such Alternate Base Rate Loans shall be equal to the Alternate Base Rate
(or, in each case, when applicable pursuant to this Agreement or any other
Loan Document, the Default Rate).”

“‘Note D Loans’ means the Loans made to Borrowers evidenced by Note
D and bearing interest at the Note D Interest Rate.”

“‘Note D Lockout Period’ has the meaning assigned in Section
2.3.5(c).”

“‘Rent Deposit Obligation’ means the obligation of each Borrower and
Manager to deposit all Rents into the Lockbox Accounts.”

     B. General. Section 2.1 of the Loan Agreement is hereby amended to read in its
entirety as follows:

     “2.1 General. Each Lender severally agrees, on the terms and
conditions of this Agreement, to make loans to Borrowers in Dollars in an
aggregate principal amount up to but not exceeding the amount of the

4

 

Commitment of such Lender. The Loans shall be funded in one or more
advances and repaid in accordance with this Agreement. Loans applicable to
Note C and Loans applicable to Note D hereunder are distinguished by
“Type.” The “Type” of a Loan refers to whether such Loan is
an Alternate Base Rate Loan or a Libor-based Loan, each of which constitutes
a Type.”

     C. Advances. Section 2.1.1(c) of the Loan Agreement is hereby amended to read in its
entirety as follows:

     “(c) Initial Advance of Note D Loans. The initial advance of
the Note D Loans, in the aggregate amount of up to $19,500,000.00, shall be
made ratably by the Lenders to the Borrowers proportionately in accordance
with the respective Allocated Loan Amounts of the Project(s) owned by each
Borrower upon Borrowers’ satisfaction of the conditions to initial advance
described in Schedule 2.1.”

     D. Additional Advances of Note A and Note B. Section 2.1.1(d) of the Loan Agreement
is hereby amended to read in its entirety as follows:

     “(d) Additional Advances of Note A and Note B. In any of the
first (1st), second (2nd), third (3rd) or
fourth (4th) Loan Years, Borrowers shall be permitted to request
(and, subject to the terms and conditions of this Section 2.1 and
Borrowers’ satisfaction of the terms and conditions set forth in Parts B and
C of Schedule 2.1 hereto, each of the Lenders severally agrees to
advance its Applicable Percentage of up to two (2) additional advances of
Note A Loans and Note B Loans per Loan Year (each such additional advance,
an “Additional Advance”) in an aggregate principal amount, taking
into account all Additional Advances under the Note A and Note B in such
Loan Year and in all prior Loan Years, not to exceed Twenty Million Dollars
($20,000,000.00). Any such Additional Advance shall be made ratably to the
Borrowers and allocated proportionally to Note A and Note B in accordance
with the respective Allocated Loan Amounts for Note A and Note B for each
Project each Project and shall be used (i) first, at all times while there
is any balance on Note D, solely by Borrowers to pay down the principal
balance of Note D, (ii) second, at all time while there is any balance on
Note C, solely by Borrowers to pay down the principal balance of Note C, and
(iii) third, provided that Note D and Note C have been paid in full, by
Borrower for any business purpose, and in each case, shall be made in
accordance with a written request of the Borrowers containing the Borrowers’
wire transfer instructions and the other information required by
Schedule 2.1 (an “Additional Advance Request”). Without
limiting the generality of the foregoing, each Lender’s obligation to fund
its Applicable Percentage of any Additional Advance is subject to
Administrative Agent’s verification, based upon audits of Net Operating
Income for periods ending not more

5

 

than sixty (60) days prior to the date of
the proposed Additional Advance,
of the then Net Operating Income, Debt Service Coverage and Cash on
Cash Return. Upon verifying that Borrowers have satisfied or failed to
satisfy the Additional Advance conditions set forth in Parts B and C of
Schedule 2.1, Administrative Agent shall so notify the Borrowers and
the Lenders and, if the Additional Advance conditions have been satisfied,
the Lenders shall each make their respective Applicable Percentages of the
requested Additional Advance available to the Borrowers on the date
specified by Administrative Agent in such notice to the Borrowers and the
Lenders, which date shall be the first Payment Date immediately following
the date on which such notice is given. For the avoidance of doubt: (i) no
Additional Advance may be used for any other purpose than (x) first, to
repay the principal balance on Note D unless and until Note D has been
repaid in full, and (y) second, to repay the principal balance on Note C,
unless and until Note D and Note C have been repaid in full, and nothing in
this Section 2.1.1(d) shall be construed as to permit the making of
an Additional Advance for purposes of repaying all or any portion of Note D
or Note C prior to the end of the Note D Lockout Period and the Note C
Lockout Period, as applicable; (ii) in determining the amount of any
Additional Advance hereunder, after Borrowers have satisfied all of the
Additional Advance conditions set forth herein and in Parts B and C of
Schedule 2.1, each Additional Advance by the Lenders hereunder shall
be reduced by an amount equal to the reduction in the outstanding principal
amount of the Loans attributed to the cumulative Acceleration Payment(s) on
account of each Partial Release made pursuant to Section 3.9.1; and
(iii) in no event shall the outstanding principal balance of the Loans
hereunder at any time exceed the Maximum Loan Amount. Amounts borrowed
hereunder and repaid may not be reborrowed.”

     E. Note D Debt Service Reserve. A new Section 2.1.1(e) of the Loan Agreement shall be
added as follows:

     “(e) Note D Debt Service Reserve. Borrowers shall be permitted
to request (and, subject to the terms and conditions of this Section
2.1 and Borrowers’ satisfaction of the terms and conditions set forth in
Parts B and C of Schedule 2.1 hereto, each of the Lenders severally
agrees to advance its Applicable Percentage of additional Note D Loans (each
such additional advance, a “Debt Service Advance”) in an aggregate
principal amount, taking into account all other Debt Service Advances in
such Loan Year and in all prior Loan Years, not to exceed Five Hundred
Thousand Dollars $500,000.00 (the “Note D Debt Service Reserve”).
Any such Debt Service Advance shall be advanced from time to time (and,
subject to the terms and conditions of this Section 2.1 and
Borrowers’ satisfaction of the terms and conditions set forth in Parts B and
C of Schedule 2.1 hereto, each of the Lenders severally agrees to
advance its Applicable Percentage of such Debt Service Advance) for the
purpose

6

 

of making scheduled debt service payments on the Loans during
periods in
which there is insufficient Operating Revenues to cover such debt
service payments. Provided no Potential Default or Event of Default exists
and subject to satisfaction of the conditions set forth in Parts B and C of
Schedule 2.1 prior to each such advance, the Lenders shall make Debt
Service Advances as requested by Borrowers on a monthly basis within five
(5) Business Days following receipt by Administrative Agent of a written
request for such advance (in a form reasonably approved by Administrative
Agent). Such request shall be executed by an authorized officer of
Borrowers and shall certify, among other things, that there are insufficient
Operating Revenues to pay the scheduled debt service payments for which such
Debt Service Advance is being requested. In no event shall any such Debt
Service Advance be in an amount in excess of the debt service payments on
the Note D Loans then due hereunder, and in no event will the aggregate
amount of all Debt Service Advances exceed $500,000.00. At such time as the
Debt Service Coverage shall be at least 1.10:1 for a period of six (6)
consecutive months, upon written request of Borrowers (and subject to the
terms and conditions of this Section 2.1 and Borrowers’ satisfaction
of the terms and conditions set forth in Parts B and C of Schedule
2.1 hereto), any portion of the Note D Debt Service Reserve which
remains unfunded as of the date of such request shall be advanced to
Borrowers. All Debt Service Advances shall be made ratably to the Borrowers
and allocated proportionally to Note D in accordance with the respective
Allocated Loan Amounts for Note D for each Project.”

     F. Amortization.

     (i) Section 2.3.3 of the Loan Agreement shall be renamed “Note C and Note D
Principal Amortization”; and

     (ii) Section 2.3.3 ( Note C Principal Amortization) shall be denominated as a
new subsection (a) of Section 2.3.3;

     (iii) The reference in the second sentence of Section 2.3.3 (Note C Principal
Amortization) to “Section 2.1.1(a)” is hereby amended to refer to “Section
2.1.1(d).”

     (iv) A new subsection (b) of Section 2.3.3 shall be added to the Loan Agreement as
follows:

     “(b) Note D Principal Amortization. On the August 1, 2006 (the
“Note D Amortization Date”), and on each subsequent Payment Date
until the earlier to occur of: (i) the Maturity Date or (ii) the date the
principal amount of the Note D Loans has been paid in full, in addition to
the payment of interest as provided in Section 2.3.1 hereof and any
other sums required to be paid to the Lenders by Borrowers hereunder,
Borrowers shall pay to the Lenders monthly principal payments in sufficient
amounts so as to amortize the outstanding principal balance

7

 

from time to time of the Note D Loans over a twenty-five (25) year
period commencing on the Note D Amortization Date, as calculated by
Administrative Agent monthly based on the Note D Interest Rate then in
effect. In the event any Additional Advance(s) are made pursuant to
Section 2.1.1(d) hereunder to prepay the Note D Loans after the Note
D Amortization Date, Administrative Agent shall, at the time of such
Additional Advance, adjust the required monthly amortization payments
required under this Section 2.3.3(b) to take account of such
Additional Advance and reduction of the balance of the Note D Loans.
Administrative Agent’s determination of the amount of the monthly
amortization payments to be made by Borrowers under this Section
2.3.3(b) shall be reasonably calculated and conclusive absent
demonstrable error.”

G. Prepayment of Loan.

     (i) The last sentence of Section 2.3.5(a) of the Loan Agreement is hereby amended to
read in its entirety as follows:

“Without limiting the foregoing, Borrowers shall have the right to defease
all or a portion of the Loans in accordance with Exhibit J attached
hereto after the Note A and Note B Lockout Period, the Note C Lockout Period
and the Note D Lockout Period.”

     (ii) A new subsection (c) of Section 2.3.5 of the Loan Agreement is hereby added as
follows:

“(c) Note D Loans. The Note D Loans are closed to prepayment, in
whole or in part, during the first eighteen months following the date of
execution of the Amendment (the “Note D Lockout Period”).
Thereafter, upon not less than thirty (30) days’ prior written notice to
Administrative Agent, Borrowers may prepay the Note D Loans, in whole or in
part.”

     (iii) Section 2.3.7 of the Loan Agreement is amended in its entirety to read as
follows:

“2.3.7 Loans Continue if Prepayment Not Made. If after providing
Administrative Agent with notice of its intention to prepay any of the Loans
on a date certain, Borrowers fail to prepay any of the Loans on such date,
(1) such notice of prepayment shall be deemed rescinded, and (2) the Loans
shall continue without Potential Default or Event of Default by reason of
such failure provided that Borrowers pay to Administrative Agent and the
Lenders the out-of-pocket fees and expenses and, with respect to Note C and
Note D only, breakage costs incurred by Administrative Agent and the Lenders
as a result of such failure by Borrowers, if any.”

8

 

     H. Yield Protection. Section 2.8 of the Loan Agreement is hereby amended to read as
follows:

     “2.8 Yield Protection; Etc. The provisions of this Section
2.8 set forth below shall apply only to the Note C Loans and the Note D
Loans.”

     I. Release of Projects.

     (i) Section 3.9.1(f)(iii) is hereby amended to read in its entirety as follows:

     “(iii) after giving effect to such Partial Release, the LTV will not be
greater than the lower of (1) 85% and (2) the LTV immediately prior to the
release;”

     (ii) Section 3.9.1(g)(iii) is hereby amended to read in its entirety as follows:

     “(iii) after giving effect to such Partial Release, the LTV will not be
greater than the lower of (1) 89% and (2) the LTV immediately prior to the
release;”

     (iii) Section 3.9.1 of the Loan Agreement is hereby amended and revised to renumber the
existing clauses (h) through (m) of Section 3.9.1 to clauses (i) through (n) of Section
3.9.1, as more fully set forth in subparagraphs (iv) through (ix) below, and Section 3.9.1
is hereby further revised to insert a new clause (h) as follows:

     “(h) with respect to the Note D Loans:

     (i) after giving effect to such Partial Release, the Cash on Cash
Return will not be lower than the greater of (1) a 6.9% Cash On Cash Return
and (2) the Cash On Cash Return for the trailing six (6) consecutive months
immediately prior to such Partial Release;

     (ii) after giving effect to such Partial Release, the Debt Service
Coverage will not be lower than the greater of (1) 1.04:1 Debt Service
Coverage and (2) the Debt Service Coverage for the trailing six (6)
consecutive months;

     (iii) after giving effect to such Partial Release, the LTV will not be
greater than the lower of (1) 95% and (2) the LTV immediately prior to the
release;”

     (iv) Existing clause (h) of Section 3.9.1 shall be renumbered clause (i) and amended in
its entirety to read as follows:

“(i) Administrative Agent shall have received from Borrowers with respect to
the matters referred to in clauses (f), (g) and (h), (x) statements of the
Net Operating Income and Debt Service (both on a consolidated basis and
separately for the applicable Project(s) to be released for the

9

 

applicable measuring period) and (y) based on the foregoing statements of
Net Operating Income and Debt Service, calculations of the Debt Service
Coverage and Cash on Cash Return both with and without giving effect to the
proposed Partial Release, accompanied by an officer’s certificate that such
statements, calculations and information are true, correct and complete in
all material respects;”

     (v) Existing clause (i) of Section 3.9.1 shall be renumbered clause (j);

     (vi) Existing clause (j) of Section 3.9.1 shall be renumbered clause (k);

     (vii) Existing clause (k) of Section 3.9.1 shall be renumbered clause (l);

     (viii) Existing clause (l) of Section 3.9.1 shall be renumbered clause (m); and

     (ix) Existing clause (m) of Section 3.9.1 shall be renumbered clause (n) and
amended in its entirety to read as follows:

“(n) Borrowers shall have delivered to Administrative Agent an officer’s
certificate confirming the matters referred to in clause (h) above and
certifying that all conditions precedent for such Partial Release contained
in this Agreement have been satisfied.”

     J. Sale of Houses. Section 3.9.4 of the Loan Agreement is hereby amended in its
entirety to read as follows:

“3.9.4 Sale of Houses. Without limiting the other provisions of
this Section 3.9, Borrowers shall have the right to sell one or more
of the existing four (4) single and multi-family homes located on the
Project known as 200 Fountain-Executive House (each a “House”),
provided that the following conditions are satisfied: (a) such release shall
be in connection with a bona fide, arm’s length sale of a House to a third
party who is not an Affiliate of any Borrower, (b) Borrowers shall pay one
hundred percent (100%) of the Net Sale Proceeds received from the such of
each House to Administrative Agent to pay down ratably the outstanding
principal balance of the Loans, (c) Borrowers shall pay the Make Whole
Breakage Amount with respect to the prepayment of the Note A Loans and the
Note B Loans (with no Make Whole Breakage Amount applied to the prepayment
of the Note C Loans or the Note D Loans, but without limiting Borrower’s
obligations under Section 2.8), (d) Borrowers shall, after giving
effect to the sale of each such House, satisfy the Cash on Cash Return and
Debt Service Coverage requirements set forth in Paragraph 1 of Part B of
Schedule 2.1, (e) such House is located on a separate legal parcel
in compliance with all applicable legal requirements, and (f) Administrative
Agent shall be satisfied in its sole discretion that
the sale of such House does not in any way impair the

10

 

priority of Liens on
the remaining Projects. The sale of any House shall be permitted by
Administrative Agent at any time, including during the Note A and Note B
Lockout Period, the Note C Lockout Period and the Note D Lockout Period then
existing. The Net Sales Proceeds received by Administrative Agent from the
sale of any House shall be applied pro rata to the repayment of the
outstanding principal balance of each of Note A Loans, Note B Loan, the Note
C Loans and, if any are then outstanding, the Note D Loans; provided,
however, that if an Event of Default has occurred and is continuing,
Administrative Agent may apply such Net Proceeds to the obligations of the
Borrowers hereunder in such order and manner of priority as Administrative
Agent may elect in its sole and absolute discretion. For purposes hereof,
“Net Sales Proceeds” means any and all consideration received by a
Borrower in connection with a bona fide, arm’s length sale of a House to a
third party who is not an Affiliate of any Borrower, less the following
costs and expenses to the extent actually incurred by such Borrower in
connection with such sale: (i) reasonable and customary brokerage
commissions; (ii) the reasonable cost of title insurance purchased for the
buyer; (iii) documentary transfer taxes, sales taxes and recording fees;
(iv) reasonable escrow fees; and (v) other reasonable closing costs and
expenses of the type customarily incurred by sellers of real property in the
locale where the applicable House is located.”

     K. Interest Rate Protection Agreement. Section 9.16 of the Loan Agreement is hereby
amended in its entirety to read as follows:

“9.16 Interest Rate Protection Agreement. With respect to the Note
C Loans and the Note D Loans, on or before July 7, 2006, Borrowers shall
purchase and, not later than July 14, 2007, deliver to Administrative Agent,
and thereafter maintain in full force and effect, at Borrowers’ sole cost
and expense, an interest rate protection agreement that (a) is with a
financial institution having a long term unsecured debt rating of at least
“AA-” by S&P and the equivalent ratings by Moody’s (“Counterparty”);
(b) has at least an initial two-year term; (c) is an interest rate cap in
respect of a notional amount not less than the outstanding principal amount
of the Note C Loans and the Note D Loans that shall have the effect of
capping the LIBOR-based Rate of the Note C Loans and the Note D Loans at
interest rates that would cause the Debt Service Coverage to be equal or
greater than 1.05 to 1; (d) shall not be secured by any Project or any
pledge of the membership interests in any Borrower; and (e) is otherwise in
a form acceptable to Administrative Agent (an “Interest Rate Protection
Agreement”). Upon the expiration of the initial term, the Interest Rate
Protection Agreement shall be renewed or amended on an annual basis (or
Borrowers shall have entered into a new interest rate protection agreement),
as necessary, (1) to increase or decrease the notional amount
to reflect the then current aggregate outstanding principal balance of the

11

 

Note C Loans and the Note D Loans, (2) to have the effect of capping the
LIBOR-based Rate of the Note C Loans and the Note D Loans at interest rates
that would cause the Debt Service Coverage to be equal or greater than 1.05
to 1, (3) to have a term of at least one year and (4) is otherwise in form
and substance acceptable to Administrative Agent. In the event of that a
Counterparty’s long term unsecured debt rating falls below “AA-” as
determined by S&P and the equivalent ratings by Moody’s, Borrower shall
replace the Interest Rate Protection Agreement with a replacement Interest
Rate Protection Agreement meeting the requirements of this Section
9.16 not later than ten (10) Business Days after learning of such
downgrade, withdrawal or qualification. In the event that the Interest Rate
Protection Agreement is terminated for any reason or is otherwise
unenforceable by Borrowers, Borrowers shall promptly obtain from a financial
institution reasonably satisfactory to Administrative Agent a replacement
interest rate protection agreement in form and substance similar to the
Interest Rate Protection Agreement. Borrowers shall pledge to
Administrative Agent (on behalf of the Lenders) all right, title and
interest of Borrowers in and to all payments owing to or received by
Borrowers under the Interest Rate Protection Agreement (and any replacement
interest rate protection agreement) as additional collateral for the Loans
and deliver to Administrative Agent a favorable legal opinion with respect
to the enforceability of such pledge against the Counterparty thereunder.
Borrowers shall execute and deliver, and shall cause the Counterparty under
the applicable Interest Rate Protection Agreement to execute and deliver, to
Administrative Agent (on behalf of the Lenders) an Interest Rate Protection
Pledge within fifteen (15) days following the date of execution of the
Amendment.”

     L. Limitation on Liability. Section 13.1 of the Loan Agreement is hereby amended in
its entirety to read as follows:

“13.1 Limitation on Liability. Except as provided below, none of
the Borrowers nor Tarragon or its officers, directors or shareholders shall
be personally liable for amounts due under the Loan Documents (except
Tarragon shall be personally liable under the Recourse Guaranties and the
Hazardous Materials Indemnity Agreements and, upon the occurrence of a
Springing Recourse Event, William S. Friedman shall be personally liability
under the Carve-Out Guaranty). Each Borrower and Tarragon, however, shall
be personally liable to Administrative Agent and the Lenders on a joint and
several basis for any deficiency, loss or damage suffered by Administrative
Agent or any Lender because of: (1) any Borrower’s or Tarragon’s commission
of a criminal act, (2) the failure to comply with provisions of the Loan
Documents prohibiting the sale, transfer or encumbrance of any Project, any
other collateral, or any direct or indirect ownership interest in any
Borrower; (3) the misapplication by
any Borrower or any Borrower Party or Tarragon of any funds derived

12

 

from any
Project, including security deposits, insurance proceeds and condemnation
awards in violation of this Agreement or any of the other Loan Documents;
(4) the fraud or misrepresentation by any Borrower, Tarragon, or any
Borrower Party made in or in connection with the Loan Documents or the
Loans; (5) any Borrower’s collection of Rents more than one month in advance
or entering into or modifying leases, or receipt of monies by any Borrower
or any Borrower Party in connection with the modification of any Leases, in
violation of this Agreement or any of the other Loan Documents; (6) any
Borrower’s failure to apply proceeds of Rents or any other payments in
respect of the Leases and other income of any Project or any other
collateral when received to the costs of maintenance and operation of any
Project and to the payment of taxes, lien claims, insurance premiums, Debt
Service and other amounts due under the Loan Documents to the extent the
Loan Documents require such proceeds to be then so applied; (7) any
Borrower’s or Tarragon’s interference with Administrative Agent’s exercise
of rights under the Assignment of Rents and Leases; (8) any Borrower’s or
Tarragon’s failure to timely renew any letter of credit issued in connection
with the Loans; (9) any Borrower’s failure to maintain insurance as required
by this Agreement or to pay any taxes or assessments affecting any Project;
(10) damage or destruction to any Project caused by the acts or omissions of
any Borrower, or any Borrower’s agents, employees, or contractors; (11) any
Borrower’s failure to comply with its obligations with respect to
environmental matters under Article 5; (12) any Borrower’s or
Tarragon’s failure to pay for any loss, liability or expense (including
attorneys’ fees) incurred by Administrative Agent or any Lender arising out
of any claim or allegation made by any Borrower or Tarragon, their
successors or assigns, or any creditor of such Borrower or Tarragon, that
this Agreement or the transactions contemplated by the Loan Documents
establish a joint venture, partnership or other similar arrangement between
any Borrower, Tarragon, Administrative Agent and any Lender; (13) any
brokerage commission or finder’s fees claimed in connection with the
transactions contemplated by the Loan Documents; (14) uninsured damage to
any Project resulting from acts of terrorism; (15) the failure of any
Borrower and/or Tarragon after Administrative Agent’s exercise of any of its
remedies pursuant to Article 11 to cooperate with any laws, rules,
regulation, or ordinances of any governmental authority governing or related
to residential property; (16) the making of any claim by any Borrower,
Tarragon, any Borrower Party or any other person or entity that the
transactions contemplated by the Loans constitutes a “Fraudulent Conveyance”
as such term is used in the United States Bankruptcy Code; (17) the failure
of Borrowers to cause Net Cash Flow to be deposited in accordance with
Section 3.1 and the failure of Borrowers or Managers to cause all
Rents to be deposited into the Lockbox Account as required
under Section 3.2; (18) any losses or damages incurred by
Administrative Agent or any Lender to the extent that, in Administrative
Agent’s or such

13

 

Lender’s reasonable judgment, such losses or damages would
not have been incurred by Administrative Agent or such Lender if
Administrative Agent and the Lenders had fully cross collateralized each of
the Loans with respect to each Borrower pursuant to first and second
mortgages from each Borrower in favor of Administrative Agent (on behalf of
the Lenders) and guaranties by each of the Borrowers of all of the other
Borrowers’ Loans, which guaranties are secured by second mortgages on each
of the Projects of such guarantor; or (19) any damage or loss suffered by
Administrative Agent or any Lender at any time as a result of or relating to
the commingling of any of any Borrower’s funds with the funds of any other
Borrower or Person (including, without limitation, Affiliates, partners, and
managing members of any Borrower). None of the foregoing limitations on
personal liability shall modify, diminish or discharge the personal
liability of any Guarantor. Notwithstanding anything to the contrary
contained in this Agreement or the other Loan Documents, (A) nothing herein
shall be deemed to be a waiver of any right that Administrative Agent or any
Lender may have under Sections 506(a), 506(b),
1111(b) or any other provision of the United States Bankruptcy Code,
as such sections may be amended, or corresponding or superseding sections of
the Bankruptcy Amendments and Federal Judgeship Act of 1984, to file a claim
for the full amount due to Administrative Agent or such Lender under the
Loan Documents or to require that all collateral shall continue to secure
the amounts due under the Loan Documents; (B) the Loans evidenced by Note D
shall be fully recourse to Borrowers, Tarragon and, subject to the
provisions of the Carve-out Guaranty, William S. Friedman, jointly and
severally, in the event that one or more of the following occurs (each, a
“Joint and Several Springing Recourse Event”): (I) Borrower,
Borrower Party or Tarragon asserts any claim or defense with respect to any
foreclosure action commenced under the Mortgages following any monetary
default or material non-monetary (including any Event of Default described
under Sections 10.2, 10.3 and 10.6) which hinders, delays or interferes with
Administrative Agent’s or any Lender’s enforcement of its rights under the
Loan Documents or the realization of the collateral for the Loans, (II) the
filing by any Borrower or any Borrower Party, or the filing against any of
the preceding Persons, of a petition under the United States Bankruptcy Code
or similar state insolvency laws, or (III) a consolidation of any Borrower
or Borrower Party with any other Borrower or any other Person in any
proceeding commenced under the United States Bankruptcy Code or similar
state insolvency laws; and (C) the Loans evidenced by Note D shall be fully
recourse to Borrowers and Tarragon in the event of a the filing by or
against Tarragon of a petition under the United States Bankruptcy Code or
similar state insolvency laws (such event, a “Tarragon Springing
Recourse Event”).”

14

 

     M. Commitments. Schedule 1 of the Loan Agreement (the Commitments) is hereby
deleted and replaced in its entirety with a revised and amended schedule of Commitments, which is
attached hereto as Exhibit A. All references in the Loan Documents to the “Commitments”
shall hereafter refer to Exhibit A attached hereto.

     N. Allocated Loan Amounts. Exhibit D of the Loan Agreement (the Allocated
Loan Amounts) is hereby deleted and replaced in its entirety with a revised and amended schedule of
Allocated Loan Amounts, which is attached hereto as Exhibit B. All references in the Loan
Documents to the “Allocated Loan Amounts” shall hereafter refer to Exhibit B attached
hereto.

     O. Carve-Out Guaranty. Concurrently herewith and as a condition to the effectiveness
hereof, Tarragon and William S. Friedman are executing and delivering to the Administrative Agent
the Amended and Restated Carve-Out Guaranty (the “Amended and Restated Carve-Out
Guaranty”). The Amended and Restated Carve-Out Guaranty shall be a Loan Document, and (i) all
references herein and in the Loan Agreement and in the Loan Documents to the “Recourse
Guaranties” shall be deemed to include the Amended and Restated Carve-Out Guaranty unless the
context otherwise requires and (ii) all references herein and in the Loan Agreement and in the Loan
Documents to the “Loan Documents” shall be deemed to include the Amended and Restated
Carve-Out Guaranty unless the context otherwise requires.

     P. Cash Management. A new Section 3.2 is hereby added to the Loan Agreement as
follows:

“3.2 Cash Management.

     3.2.1 Lockbox Accounts. Not later than July 31, 2006, each
Borrower shall execute and deliver, and shall cause each Lockbox Bank to
execute and deliver, a Lockbox Agreement, the terms and provisions of which
Administrative Agent (on behalf of the Lenders) shall be able to enforce,
and pursuant to which the Borrowers and the Managers at each of the Projects
shall perform their respective Rent Deposit Obligations. Each Borrower and
Manager shall caused to be deposited into an account (each, a “Lockbox
Account”) established pursuant to the Lockbox Agreement to which such
Borrower is a party all Rents received by such Borrower or Manager.

     3.2.2 Control. Upon the occurrence of an Event of Default,
Borrowers shall no longer have any right to any of the Rents deposited into
the Lockbox Accounts (but shall continue to be obligated to deposit into the
Lockbox Accounts all Rents), and the Lockbox Banks shall, pursuant to the
Lockbox Agreements, deposit all Rents and other proceeds of the Lockbox
Account in such manner and order of priority as Administrative Agent may
direct.

     3.2.3 Grant of Security Interest and Further Assurances. Each
Borrower hereby grants a perfected first priority security interest in favor
of Administrative Agent for the ratable benefit of the Lenders in each

15

 

Lockbox Account established hereunder and all financial assets and other
property and sums at any time held, deposited or invested therein, and all
security entitlements and investment property relating thereto, together
with any interest or other earnings thereon, and all proceeds thereof,
whether accounts, general intangibles, chattel paper, deposit accounts,
instruments, documents or securities, together with all rights of a secured
party with respect thereto (collectively, the “Account Collateral”)
(even if no further documentation is requested by Administrative Agent or
the Lenders or executed by Borrowers). Borrower shall not, without the
prior consent of Administrative Agent, further pledge, assign or grant any
security interest in the Lockbox Account or the Account Collateral or permit
any Lien to attach thereto, or any levy to be made thereon, or any Uniform
Commercial Code financing statements, except those naming Administrative
Agent on behalf of the Lenders as the secured party, to be filed with
respect thereto. Each Borrower covenants and agrees: (A) to do all acts
that may be reasonably necessary to maintain, preserve and protect Reserve
Account Collateral; (B) to pay promptly when due all material taxes,
assessments, charges, encumbrances and liens now or hereafter imposed upon
or affecting any Account Collateral; (C) to appear in and defend any action
or proceeding which may materially and adversely affect any Borrowers’ title
to or Administrative Agent’s interest in the Account Collateral; (D) not to
transfer, assign, sell, surrender, encumber, mortgage, hypothecate, or
otherwise dispose of any of the Account Collateral or rights or interests
therein, and to keep the Account Collateral free of all levies and security
interests or other liens or charges except the security interest in favor of
Administrative Agent granted hereunder; (E) to account fully for and
promptly deliver to Administrative Agent, in the form received, all
documents, chattel paper, instruments and agreements constituting the
Account Collateral hereunder, endorsed to Administrative Agent or in blank,
as requested by Administrative Agent, and accompanied by such powers as
appropriate and until so delivered all such documents, instruments,
agreements and proceeds shall be held by any Borrower in trust for
Administrative Agent, separate from all other property of such Borrower; and
(F) from time to time upon request by Administrative Agent, to furnish such
further assurances of each Borrower’s title with respect to the Account
Collateral, execute such written agreements, or do such other acts, all as
may be reasonably necessary to effectuate the purposes of this agreement or
as may be required by law, or in order to perfect or continue the
first-priority lien and security interest of Administrative Agent in the
Account Collateral.”

     Q. Address for Notices. Borrower’s addresses for notices pursuant to the Loan
Agreement are hereby changed to be:

16

 

c/o Tarragon Corporation

423 West 55th Street, 12th Floor

New York, New York 10019

Attn: Todd C. Minor

Fax: (212) 949-8001

 

With a copy to:

 

3100 Monticello Avenue, Suite 200

Dallas, Texas 75205

Attn: Kathryn Mansfield

Fax: (214) 599-2250

     R. Schedule 2.1. Paragraph 1 of Part B of Schedule 2.1 is hereby amended to read in
its entirety as follows:

“1. If, after giving effect to the Additional Advance and after giving effect to
previous repayments of the Loans in connection with a Partial Release of a Project,
and the Additional Advance occurs (a) during the first Loan Year, the Cash on Cash
Return is at least 7.75%, the Debt Service Coverage is at least 1.30:1.00, and LTV
is not more than 85%, (b) during the second Loan Year, the Cash on Cash Return is at
least 8.00%, the Debt Service Coverage is at least 1.35:1.00, and LTV is not more
than 83%, (c) during the third Loan Year, the Cash on Cash Return is at least 8.25%,
the Debt Service Coverage is at least 1.40:1.00, and LTV is not more than 81%, and
(d) during the fourth Loan Year, the Cash on Cash Return is at least 8.50%, the Debt
Service Coverage is at least 1.45:1.00, and LTV is not more than 79%. Solely for
purposes of this paragraph, Cash on Cash Return, Debt Service Coverage and LTV shall
be calculated on the basis of the outstanding principal balances of the Note A and B
Loans.”

4. Modifications to Cross-Collateral Guaranties.

     A. Each Cross-Collateral Guaranty delivered by Borrowers is hereby modified as follows:

     (i) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Autumn Ridge Apartments, LLC, a Connecticut limited
liability company, as guarantor, and Administrative Agent, is hereby amended (x) to
change the amount of the Related Loans Maximum Amount set forth therein to the
amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1
attached thereto is hereby deleted and is replaced in its entirety with
Schedule 3A(i) attached hereto;

     (ii) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Dogwood Hills Apartments, LLC, a

17

 

Connecticut limited
liability company, as guarantor, and Administrative Agent, is hereby amended (x) to
change the amount of the Related Loans Maximum Amount set forth therein to the
amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1 attached thereto is hereby
deleted and is replaced in its entirety with Schedule 3A(ii) attached
hereto;

     (iii) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Forest Park Tarragon, LLC, a Connecticut limited
liability company, as guarantor, and Administrative Agent, is hereby amended (x) to
change the amount of the Related Loans Maximum Amount set forth therein to the
amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1 attached thereto is hereby
deleted and is replaced in its entirety with Schedule 3A(iii) attached
hereto;

     (iv) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Ansonia Acquisitions I, LLC, a Connecticut limited
liability company, as guarantor, and Administrative Agent, is hereby amended (x) to
change the amount of the Related Loans Maximum Amount set forth therein to the
amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1 attached thereto is hereby
deleted and is replaced in its entirety with Schedule 3A(iv) attached
hereto;

     (v) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Hamden Centre Apartments, LLC, a Connecticut limited
liability company, as guarantor, and Administrative Agent, is hereby amended (x) to
change the amount of the Related Loans Maximum Amount set forth therein to the
amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1 attached thereto is hereby
deleted and is replaced in its entirety with Schedule 3A(v) attached hereto;

     (vi) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Ansonia Liberty, LLC, a Connecticut limited liability
company, as guarantor, and Administrative Agent, is hereby amended (x) to change the
amount of the Related Loans Maximum Amount set forth therein to the amount of the
Related Loans Maximum Amount for such guaranty as set forth on Schedule 3A
attached hereto, and (y) Schedule 1
attached thereto is hereby deleted and is replaced in its entirety with
Schedule 3A(vi) attached hereto;

     (vii) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Ocean Beach Apartments, LLC, a Connecticut limited
liability company, as guarantor, and Administrative Agent, is hereby amended (x) to
change the amount of the Related Loans Maximum Amount set forth therein to the
amount of the Related Loans Maximum

18

 

Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1 attached thereto is hereby
deleted and is replaced in its entirety with Schedule 3A(vii) attached
hereto;

     (viii) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between West Dale National Associates, L.P., a Texas limited
partnership, as guarantor, and Administrative Agent, is hereby amended (x) to change
the amount of the Related Loans Maximum Amount set forth therein to the amount of
the Related Loans Maximum Amount for such guaranty as set forth on Schedule
3A attached hereto, and (y) Schedule 1 attached thereto is hereby deleted and is
replaced in its entirety with Schedule 3A(viii) attached hereto;

     (ix) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Manchester Tarragon, LLC, a Connecticut limited
liability company, as guarantor, and Administrative Agent, is hereby amended (x) to
change the amount of the Related Loans Maximum Amount set forth therein to the
amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1 attached thereto is hereby
deleted and is replaced in its entirety with Schedule 3A(ix) attached
hereto;

     (x) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Danforth Apartment Owners, L.L.C., a Florida limited
liability company, as guarantor, and Administrative Agent, is hereby amended (x) to
change the amount of the Related Loans Maximum Amount set forth therein to the
amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1 attached thereto is hereby
deleted and is replaced in its entirety with Schedule 3A(x) attached hereto;

     (xi) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company, as guarantor, and Administrative Agent, is hereby amended
(x) to change the amount of the Related Loans Maximum Amount set forth therein to
the amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y)
Schedule 1 attached thereto is hereby deleted and is replaced in its entirety
with Schedule 3A(xi) attached hereto;

     (xii) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Heather Limited Partnership, a Maryland limited
partnership, as guarantor, and Administrative Agent, is hereby amended (x) to change
the amount of the Related Loans Maximum Amount set forth therein to the amount of
the Related Loans Maximum Amount for such guaranty as set forth on Schedule
3A attached hereto, and (y) Schedule 1 attached

19

 

thereto is hereby deleted and is
replaced in its entirety with Schedule 3A(xii) attached hereto;

     (xiii) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Tarragon Savannah I, L.L.C., a Georgia limited
liability company, as guarantor, and Administrative Agent, is hereby amended (x) to
change the amount of the Related Loans Maximum Amount set forth therein to the
amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1 attached thereto is hereby
deleted and is replaced in its entirety with Schedule 3A(xiii) attached
hereto;

     (xiv) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Tarragon Savannah II, L.L.C., a Georgia limited
liability company, as guarantor, and Administrative Agent, is hereby amended (x) to
change the amount of the Related Loans Maximum Amount set forth therein to the
amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1 attached thereto is hereby
deleted and is replaced in its entirety with Schedule 3A(xiv) attached
hereto;

     (xv) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Heron Cove National, Inc., a Florida corporation, as
guarantor, and Administrative Agent, is hereby amended (x) to change the amount of
the Related Loans Maximum Amount set forth therein to the amount of the Related
Loans Maximum Amount for such guaranty as set forth on Schedule 3A attached
hereto, and (y) Schedule 1 attached thereto is hereby deleted and is replaced in its
entirety with Schedule 3A(xv) attached hereto;

     (xvi) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Vintage Legacy Lakes National, L.P., a Texas limited
partnership, as guarantor, and Administrative Agent, is hereby amended (x) to change
the amount of the Related Loans Maximum Amount set forth therein to the amount of
the Related Loans Maximum Amount for such guaranty as set forth on Schedule
3A attached hereto, and (y) Schedule 1
attached thereto is hereby deleted and is replaced in its entirety with
Schedule 3A(xvi) attached hereto;

     (xvii) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Plantation Bay Apartments, L.L.C., a Florida limited
liability company, as guarantor, and Administrative Agent, is hereby amended (x) to
change the amount of the Related Loans Maximum Amount set forth therein to the
amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1 attached thereto is hereby
deleted and is replaced in its entirety with Schedule 3A(xvii) attached
hereto; and

20

 

     (xviii) That certain Secured Cross Collateral Guaranty dated as of November 30,
2005 executed by and between Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company, as guarantor, and Administrative Agent, is hereby amended
(x) to change the amount of the Related Loans Maximum Amount set forth therein to
the amount of the Related Loans Maximum Amount for such guaranty as set forth on
Schedule 3A attached hereto, and (y) Schedule 1 attached thereto is hereby
deleted and is replaced in its entirety with Schedule 3A(xviii) attached
hereto.

     5. Loan Agreement and Loan Documents. From and after the date hereof, all references
in the Loan Documents to the “Loan Agreement” and the “Loan Documents” shall be
deemed to refer to the Loan Agreement and the Loan Documents as amended, modified and supplemented
hereby and by the documents executed in connection with this Amendment. This Amendment and each of
the documents executed in connection herewith shall be deemed to be a Loan Document.

     6. Promissory Notes. Concurrently herewith, Borrowers are executing and delivering to
the order of the Lenders, new promissory notes (each a “Loan D Note”, and collectively the
“Loan D Notes”) which reflect the increased Commitments relating to the Loans evidenced by
Note D of each Lender and shall otherwise be in form and substance acceptable to Lenders. The Loan
D Notes shall each be a Loan Document, and all references herein and in the Loan Agreement and in
the Loan Documents to the “Loan Documents” shall be deemed to include the Loan D Notes
unless the context otherwise requires.

     7. Reaffirmation of Guarantor Documents. Concurrently herewith, Tarragon is executing
and delivering to Administrative Agent the Reaffirmation of Guaranty (the “Guaranty
Reaffirmation”) attached hereto and made a part hereof. The Guaranty Reaffirmation shall be a
Loan Document and all references herein and in the Loan Agreement and in the Loan Documents to the
“Loan Documents” shall be deemed to include the Guaranty Reaffirmation unless the context
otherwise requires.

     8. Reaffirmation of Pledge Agreements. Concurrently herewith, Pledgors are executing
and delivering to Administrative Agent the Reaffirmation of Pledge and Security Agreements (the
“Pledge Reaffirmation”) attached hereto and made a part hereof. The Pledge
Reaffirmation shall be a Loan Document and all references herein and in the Loan Agreement and
in the Loan Documents to the “Loan Documents” shall be deemed to include the Pledge
Reaffirmation unless the context otherwise requires.

     9. Reaffirmation of Manager’s Consent and Subordination of Management Agreements.
Concurrently herewith, Managers are executing and delivering to Administrative Agent the
Reaffirmation of Manager’s Consent and Subordination of Management Agreements (the “Manager
Reaffirmation”) attached hereto and made a part hereof. The Manager Reaffirmation shall be a
Loan Document and all references herein and in the Loan Agreement and in the Loan Documents to the
“Loan Documents” shall be deemed to include the Manager Reaffirmation unless the context
otherwise requires.

21

 

     10. Conditions Precedent. The effectiveness of this Amendment shall be conditioned
upon the satisfaction in full of the following conditions, as determined by Administrative Agent:

     A. The annualized Adjusted Net Operating Income shall equal or exceed $28,300,000; the Cash on
Cash Return shall be at least 6.9%; Debt Service Coverage shall be at least 1.04:1; and the LTV
shall not be more than 95% (based on the lesser of actual or market occupancy), each as determined
by Administrative Agent in its sole discretion;

     B. Borrowers shall have executed and delivered to Administrative Agent modifications to each
of the Mortgages listed on Schedule 8 attached hereto evidencing the amendments,
modifications and supplements to the Loan Documents provided for herein, each of which shall be in
form and substance acceptable to Administrative Agent, and the same shall have been delivered for
recording in the Official Records of the applicable counties in which the subject Projects are
located;

     C. Borrowers and the other Borrower Parties shall have executed and delivered to
Administrative Agent such amendments, modifications and supplements to the Loan Documents as
Administrative Agent may require;

     D. Borrowers shall have paid to Administrative Agent a commitment fee in the amount of
$150,000;

     E. Borrowers shall have deposited with Administrative Agent the sum of $281,175, which amount
shall be released to Borrower upon the purchase by Borrower of the Interest Rate Protection
Agreement in accordance with Section 2.K above. In the event that the Borrower fails to timely
purchase the Interest Rate Protection Agreement in accordance with said section, without limiting
any of the other rights and remedies of Administrative Agent on account of such failure,
Administrative Agent may (but shall not be obligated to) utilize such funds to purchase an Interest
Rate Protection Agreement on Borrower’s behalf;

     F. Administrative Agent shall have obtained from the applicable title companies such
irrevocable commitments to issue to Administrative Agent such endorsements to the Title Policy as
Administrative Agent may require insuring that the Mortgages have been successfully
modified and that they continue to be an enforceable first-priority lien against the Projects
securing the Loans (as amended, modified and supplemented herein), subject only to the Permitted
Encumbrances;

     G. Administrative Agent shall have received such opinions as Administrative Agent may require
concerning the execution, delivery and enforceability of this Amendment and any other amendments,
modifications and supplements to the Loan Documents entered into in connection herewith, and such
other matters as Administrative Agent may require; and

     H. Borrowers shall have paid or reimbursed Administrative Agent for all costs and expenses
incurred by Administrative Agent in connection with the preparation, negotiation, and execution of
this Amendment and the transactions contemplated hereby, including the fees and

22

 

disbursements of
Administrative Agent’s counsel and all escrow, recording and title insurance and endorsement
charges.

     11. Representations and Warranties.

     A. Each of the representations and warranties of Borrowers contained or incorporated in the
Loan Agreement and in the other Loan Documents, in each case as amended, modified and supplemented
hereby, are true and correct in all material respects on and as of the date hereof.

     B. Each Borrower has full power and authority to enter into this Amendment and perform its
obligations hereunder, and each Borrower’s execution and delivery of this Amendment has been duly
authorized by all necessary corporate, partnership or limited liability company action. No
approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any
governmental authority or any other Person is necessary or required in connection with the
execution, delivery or performance by any Borrower of this Amendment. This Amendment has been duly
executed and delivered, and constitutes the legal, valid and binding obligation of each Borrower,
enforceable against each Borrower in accordance with its terms, except as such enforceability may
be limited by applicable bankruptcy, insolvency, or similar laws affecting the enforcement of
creditors’ rights generally, or by equitable principles relating to enforceability.

     C. As of the date hereof and immediately after giving effect to this Agreement and the actions
contemplated thereby, no Potential Default or Event of Default exists or shall exist.

     12. Reaffirmation. Each Borrower hereby (i) reaffirms, ratifies, confirms, and
acknowledges its obligations under the Notes (including, without limitation, any and all
replacement Notes issued by each Borrower), the Loan Agreement and all the other Loan Documents (as
the same are amended, modified and supplemented herein), and agrees to continue to be bound thereby
and perform thereunder, (ii) agrees and acknowledges that all such Loan Documents and all of such
Borrower’s obligations thereunder are and remain in full force and effect and, except as expressly
provided herein, have not been amended, modified, supplemented or waived.

     13. Miscellaneous.

     A. Controlling Provisions. In the event of any inconsistencies between the provisions
of this Amendment and the provisions of any other Loan Document, the provisions of this Amendment
shall govern and prevail. Except as expressly amended, modified and supplemented by this
amendment, the Loan Documents shall not be amended, modified, supplemented or waived and shall
remain in full force and effect.

     B. Further Assurances. At Administrative Agent’s request, Borrowers shall promptly
execute any other document or instrument and/or seek any consent or agreement from any third party
that Administrative Agent reasonably determines is necessary to evidence or further, or is
otherwise relevant to, the intent of the parties, as set forth in this Amendment. At
Administrative Agent’s request, Borrowers shall promptly cause any other Borrower Party or

23

 

any of
the holders of any equity interest in any other Borrower Party, as applicable, to execute any other
document or instrument and/or diligently seek any consent or agreement from any third party that
Administrative Agent reasonably determines is necessary to evidence or further, or is otherwise
relevant to, the intent of the parties, as set forth in this Amendment. Borrowers hereby authorize
Administrative Agent to file such amendments or supplements to any UCC Financing Statements filed
in connection with the making of the Loans, and to take such other actions as may be reasonably
necessary, in order to continue and maintain the perfection of its Liens created under the Loan
Documents.

     C. Counterparts. This Amendment may be executed by one or more of the parties to this
Amendment in any number of separate counterparts, each of which, when so executed, shall be deemed
an original, and all of said counterparts taken together shall be deemed to constitute but one and
the same instrument.

     D. Successors and Assigns. The provisions of this Amendment shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and assigns, except that
Borrowers may not assign or transfer any of its rights or obligations under this Amendment or any
of the Loan Documents without the prior written consent of Administrative Agent (which consent may
be withheld in Administrative Agent’s sole and absolute discretion).

     E. Entire Agreement. This Amendment, together with the other Loan Documents, embodies
the entire agreement and understanding among Borrowers, Administrative Agent and the Lenders, and
supersedes all prior or contemporaneous agreements and understandings of such Persons, verbal or
written, relating to the subject matter hereof and thereof.

     F. No Third Parties Benefited. This Amendment is made and entered into for the sole
protection and legal benefit of Borrowers, Administrative Agent, the Lenders and their permitted
successors and assigns, and no other Person shall be a direct or indirect legal beneficiary of, or
have any direct or indirect cause of action or claim in connection with, this Amendment or any of
the other Loan Documents. Administrative Agent shall not have any obligation to any Person not a
party to this Amendment or the other Loan Documents.

     G. Governing Law. This Amendment, the rights of the parties hereunder and the
interpretation hereof shall be governed by, and construed in accordance with, the internal laws of
the State of New York, in all respects.

     H. Time. Time is of the essence as to each term or provision of this Amendment and
each of the other Loan Documents.

[SIGNATURES APPEAR ON NEXT PAGE]

24

 

     IN WITNESS WHEREOF, Borrowers, Administrative Agent, and the Lenders have caused this
Amendment to be executed by their duly authorized representatives as of the day, month and year
first above written.

	 	 	 	 	 
	 	LENDER:

GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware

corporation  	 
	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 
	 	ADMINISTRATIVE AGENT:

GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware

corporation  	 
	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 	 
	 

[SIGNATURES CONTINUE ON NEXT PAGE]

S-1

 

	 	 	 	 	 
	 	

BORROWERS

TARRAGON HUNTSVILLE APARTMENTS, L.L.C., an Alabama limited liability company

 	 
	 	By:  	Ansonia MezzCo, LLC, a Delaware limited
liability company, its Managing Member 	 
	 
	 	 	By:  	 	 
	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary 	 
	 

	 	 	 	 	 
	 	WEST DALE NATIONAL ASSOCIATES,
L.P., a Texas limited partnership

 	 
	 	By:  	Vintage
National, Inc., a Texas corporation, its
General Partner	 
	 
	 	 	 
	 	 	By:  	 	 	 
	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary 	 
	 

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	MANCHESTER TARRAGON, LLC, a Connecticut limited

liability company
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Woodcreek Garden Apartments, a California

limited partnership, its Managing Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	TRI Woodcreek, Inc., a Nevada corporation,
its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary

[SIGNATURES CONTINUE ON NEXT PAGE]

S-2

 

	 	 	 	 	 
	 	AUTUMN RIDGE APARTMENTS, LLC,
a Connecticut limited
liability company  	 
	 
	 	By:   	Ansonia MezzCo, LLC, a Delaware limited
liability company, its Managing Member 	 
	 
	 	 	By:  	 	 
	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary 	 
	 
	 	DOGWOOD HILLS APARTMENTS,
LLC, a 
Connecticut limited liability company  	 
	 
	 	By:  	Ansonia MezzCo, LLC, a Delaware
limited
liability company, its Managing Member 	 
	 
	 	 	By:  	 	 
	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary 	 
	 
	 	FOREST PARK TARRAGON, LLC, a
Connecticut 
limited
liability company

 	 
	 	By:  	Ansonia MezzCo, LLC, a Delaware
limited 
liability company, its Managing Member 	 
	 
	 	 	By:  	 	 
	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary 	 
	 
	 	ANSONIA ACQUISITIONS I, LLC, a Connecticut limited
liability company  	 
	 
	 	By:  	Ansonia MezzCo, LLC, a Delaware limited
liability company, its Managing Member  	 
	 
	 	 	By:  	
 	 
	 	 	 	Kathryn Mansfield 	 
	 	 	 	Executive Vice President and Secretary 	 
	 

[SIGNATURES CONTINUE ON NEXT PAGE]

S-3

 

	 	 	 	 	 	 
	 	HAMDEN CENTRE APARTMENTS,
LLC, a

Connecticut limited liability company

 	 
	 
	 	By:  	Ansonia MezzCo, LLC, a Delaware limited 	 
	 	 	liability company, its Managing Member 	 
	 
	 	 	 
	 	 	By:  	 	 
	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary 	 
	 
	 	ANSONIA LIBERTY, LLC, a
Connecticut limited

liability company 	 
	 
	 	By:  	Ansonia MezzCo, LLC, a Delaware limited 	 
	 	 	liability company, its Managing Member 	 
	 
	 	 	 
	 	 	By:  	 	 
	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary 	 
	 
	 	OCEAN BEACH APARTMENTS, LLC,
a

Connecticut limited liability company 	 
	 
	 	By:  	Ansonia MezzCo, LLC, a Delaware limited 	 
	 	 	liability company, its Managing Member 	 
	 
	 	 	 
	 	 	By:  	 	 
	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary 	 
	 
	 	DANFORTH APARTMENT OWNERS,
L.L.C., a

Florida limited liability company 	 
	 
	 	By:  	Ansonia MezzCo, LLC, a Delaware limited 	 
	 	 	liability company, its Managing Member 	 
	 
	 	 	 
	 	 	By:  	 	 
	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary 	 
	 

[SIGNATURES CONTINUE ON NEXT PAGE]

S-4

 

	 	 	 	 	 	 
	 	HERON COVE NATIONAL, INC., a Florida corporation

 	 
	 	By:  	 	 
	 	 	Kathryn Mansfield 	 
	 	 	Executive Vice President and Secretary 	 
	 
	 	PLANTATION BAY APARTMENTS,
L.L.C., a Florida limited liability company

 	 
	 	By:  	Ansonia MezzCo, LLC, a Delaware limited 	 
	 	 	liability company, its Managing Member 	 
	 
	 	 	 
	 	 	By:  	
 	 
	 	 	 	Kathryn Mansfield 	 
	 	 	 	Executive Vice President and Secretary 	 
	 
	 	TARRAGON SAVANNAH I, L.L.C.,
a Georgia limited liability company

 	 
	 	By:  	Ansonia MezzCo, LLC, a Delaware limited
liability company, its Managing Member 	 
	 
	 	 	 
	 	 	By:  	
 	 
	 	 	 	Kathryn Mansfield 	 
	 	 	 	Executive Vice President and Secretary 	 
	 
	 	TARRAGON SAVANNAH II, L.L.C.,
a Georgia
limited liability company

 	 
	 	By:  	Ansonia MezzCo, LLC, a Delaware limited
liability company, its Managing Member 	 
	 
	 	 	 
	 	 	By:  	
 	 
	 	 	 	Kathryn Mansfield 	 
	 	 	 	Executive Vice President and Secretary 	 
	 

[SIGNATURES CONTINUE ON NEXT PAGE]

S-5

 

	 	 	 	 	 	 
	 	HEATHER LIMITED PARTNERSHIP,
a Maryland limited partnership

 	 
	 	By:  	Vintage National, Inc., a Texas
corporation, its General Partner 	 
	 
	 	 	 
	 	 	By:  	 	 
	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary 	 
	 
	 	SUMMIT / TARRAGON MURFREESBORO, L.L.C., a Tennessee
limited liability company

 	 
	 	By:  	Stewart Square National, Inc., a Nevada
corporation, its Managing Member 	 
	 
	 	 	 
	 	 	By:  	 	 
	 	 	 	Kathryn Mansfield

Executive Vice President and Secretary 	 
	 
	 	VINTAGE LEGACY LAKES NATIONAL,
L.P., a Texas limited partnership

 	 
	 	By:  	Vintage National, Inc., a Texas corporation, 	 
	 	 	its General Partner 	 
	 
	 	 	 
	 	 	By:  	 	 
	 	 	 	Kathryn Mansfield 	 
	 	 	 	Executive Vice President and Secretary 	 
	 

S-6

 

REAFFIRMATION OF GUARANTY

          As consideration for the agreements and covenants contained in the within Amendment, and for
other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
the undersigned (“Guarantor”), as guarantor under that certain Cross Collateralization
Guaranty, dated as of November 30, 2005 (the “Guaranty”), delivered to Administrative Agent
in connection with the Loans made by the Lenders pursuant to the Loan Agreement referred to above,
hereby acknowledges, covenants and agrees as follows:

          1.      By the execution hereof, Guarantor hereby consents to the within Amendment and all the
amendments, modifications and supplements to the Loan Documents and the Loans entered into in
connection therewith.

          2.      References to the Guarantor Documents in any or all of the Loan Documents shall be deemed
to include references to the Guaranty as reaffirmed and ratified by this Reaffirmation. References
to the Loan Documents in any or all of the Guarantor Documents shall be deemed to include
references to the Loan Documents as amended, modified or supplemented by the Amendment.

          3.      Guarantor reaffirms that the Guaranty remains unchanged and in full force and effect.

          4.      Guarantor reaffirms all of the obligations contained in the Guaranty, which shall remain in
full force and effect for all the obligations of the Guarantor now or hereafter owing to
Administrative Agent (on behalf of the Lenders) pursuant to the terms and conditions of the
Guaranty and acknowledges, agrees, represents and warrants that no agreements exist with respect to
the Guaranty or with respect to the obligations of Guarantor thereunder except those specifically
set forth therein and in this Reaffirmation.

          5.      Each of the representations and warranties of Guarantor contained or incorporated in the
Guaranty, as amended by this Amendment, or any of the other Guarantor Documents, are true and
correct in all material respects on and as of the date hereof.

          6.      This Reaffirmation of Guaranty and the interpretation hereof shall be governed by, and
construed in accordance with, the internal laws of the State of New York, in all respects.

[SIGNATURE APPEARS ON NEXT PAGE]

Reaffirmation of Guaranty

1 of 2

 

          IN WITNESS WHEREOF, the Guarantor has caused this Reaffirmation of Guaranty to be duly
executed and delivered as of June 30, 2006.

	 	 	 	 	 
	 	TARRAGON CORPORATION, a Nevada corporation

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Its:  	 	 
	 

Reaffirmation of Guaranty

2 of 2

 

REAFFIRMATION OF PLEDGE AGREEMENTS

          As consideration for the agreements and covenants contained in the within Amendment, and for
other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
the undersigned (individually, a “Pledgor”, and, collectively “Pledgors”), as
pledgors under those certain Pledge and Security Agreement, dated as of November 30, 2005 (each
individually a “Pledge Agreement”, and, collectively, the “Pledge Agreements”),
each delivered to Administrative Agent in connection with the Loans made by the Lenders pursuant to
the Loan Agreement referred to above, hereby acknowledges, covenants and agrees as follows:

          1.      By the execution hereof, each Pledgor hereby consents to the within Amendment and all the
amendments, modifications and supplements to the Loan Documents and the Loan entered into in
connection therewith.

          2.      References to the Pledge Agreements in any or all of the Loan Documents shall be deemed to
include references to the Pledge Agreements as reaffirmed and ratified by this Reaffirmation.
References to the Loan Documents in any or all of the Pledge Agreements shall be deemed to include
references to the Loan Documents as amended, modified or supplemented by the Amendment.

          3.      Each Pledgor reaffirms that the Pledge Agreement to which it is a party remains unchanged
and in full force and effect.

          4.      Each Pledgor reaffirms all of the obligations contained in the Pledge Agreement to which it
is a party, which shall remain in full force and effect for all the obligations of such Pledgor now
or hereafter owing to Administrative Agent (on behalf of the Lenders) pursuant to the terms and
conditions of the applicable Pledge Agreement and acknowledges, agrees, represents and warrants
that no agreements exist with respect to the applicable Pledge Agreement or with respect to the
obligations of such Pledgor thereunder except those specifically set forth therein and in this
Reaffirmation.

          5.      Each of the representations and warranties of each Pledgor contained or incorporated in the
Pledge Agreement to which it is a party, as amended by this Amendment, or any of the other
agreements to which it is a party, are true and correct in all material respects on and as of the
date hereof.

          6.      This Reaffirmation of Pledge Agreements and the interpretation hereof shall be governed by,
and construed in accordance with, the internal laws of the State of New York, in all respects.

[SIGNATURES APPEAR ON NEXT PAGE]

Reaffirmation of Pledge Agreements

1 of 2

 

          IN WITNESS WHEREOF, the Pledgors have caused this Reaffirmation of Pledge Agreements to be
duly executed and delivered as of this June 30, 2006.

	 	 	 	 	 
	 	ANSONIA MEZZCO, LLC, a Delaware limited liability company

 	 
	 	By:  	 	 
	 	 	Kathryn Mansfield 	 
	 	 	Executive Vice President and Secretary 	 
	 

	 	 	 	 	 
	 	VINTAGE NATIONAL INC., a Texas corporation

 	 
	 	By:  	 	 
	 	 	Kathryn Mansfield 	 
	 	 	Executive Vice President and Secretary 	 
	 

	 	 	 	 	 
	 	STEWART SQUARE NATIONAL, INC., a Nevada corporation

 	 
	 	By:  	 	 
	 	 	Kathryn Mansfield 	 
	 	 	Executive Vice President and Secretary 	 
	 

	 	 	 	 	 
	 	WOODCREEK GARDEN APARTMENTS, a California limited partnership

 	 
	 	By:  	 	 
	 	 	Kathryn Mansfield 	 
	 	 	Executive Vice President and Secretary 	 
	 

	 	 	 	 	 
	 	TRI WOODCREEK, INC., a Nevada corporation

 	 
	 	By:  	 	 
	 	 	Kathryn Mansfield 	 
	 	 	Executive Vice President and Secretary 	 
	 

Reaffirmation of Pledge Agreements

2 of 2

 

REAFFIRMATION OF MANAGER’S CONSENT AND SUBORDINATION OF

MANAGEMENT AGREEMENTS

          As consideration for the agreements and covenants contained in the within Amendment, and for
other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
the undersigned (individually, a “Manager”, and, collectively “Managers”), as
managers under those certain Manager’s Consent and Subordination of Management Agreement, dated as
of November 30, 2005 (each individually a “Manager Agreement”, and, collectively, the
“Manager Agreements”), each delivered to Administrative Agent in connection with the Loans
made by the Lenders pursuant to the Loan Agreement referred to above, hereby acknowledges,
covenants and agrees as follows:

          1.      By the execution hereof, each Manager hereby consents to the within Amendment and all the
amendments, modifications and supplements to the Loan Documents and the Loan entered into in
connection therewith.

          2.      References to the Manager Agreements in any or all of the Loan Documents shall be deemed to
include references to the Manager Agreements as reaffirmed and ratified by this Reaffirmation.
References to the Loan Documents in any or all of the Manager Agreements shall be deemed to include
references to the Loan Documents as amended, modified or supplemented by the Amendment.

          3.      Each Manager reaffirms that the Manager Agreement to which it is a party remains unchanged
and in full force and effect.

          4.      Each Manager reaffirms all of the obligations contained in the Manager Agreement to which
it is a party, which shall remain in full force and effect for all the obligations of such Manager
now or hereafter owing to Administrative Agent (on behalf of the Lenders) pursuant to the terms and
conditions of the applicable Manager Agreement and acknowledges, agrees, represents and warrants
that no agreements exist with respect to the applicable Manager Agreement or with respect to the
obligations of such Manager thereunder except those specifically set forth therein and in this
Reaffirmation.

          5.      Each of the representations and warranties of each Manager contained or incorporated in the
Manager Agreement to which it is a party, as amended by this Amendment, or any of the other
agreements to which it is a party, are true and correct in all material respects on and as of the
date hereof.

          6.      Each Manager agrees to perform its Rent Deposit Obligation pursuant to Section 3.2
of the Loan Agreement and shall deposit all Rents from its respective Project(s) into the Lockbox
Account for such Project(s). No Manager shall maintain any checking, money market or other deposit
accounts for the deposit and holding of any Rents or other revenues or sums received by it from the
operation of its respective Project(s) other than the Lockbox Account.

Reaffirmation of Manager’s Consents

1 of 3

 

          7.      This Reaffirmation of Manager’s Consent and Subordination of Management Agreements and the
interpretation hereof shall be governed by, and construed in accordance with, the internal laws of
the State of New York, in all respects.

[SIGNATURES APPEAR ON NEXT PAGE]

Reaffirmation of Manager’s Consents

2 of 3

 

          IN WITNESS WHEREOF, the
Managers have caused this Reaffirmation of Manager’s Consent and
Subordination of Management Agreements to be duly executed and delivered as of this June 30, 2006.

	 	 	 	 	 
	 	TARRAGON MANAGEMENT, INC., a Texas corporation

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

	 	 	 	 	 
	 	SUNCHASE AMERICAN, LTD., a North Carolina corporation

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

	 	 	 	 	 
	 	PACIFIC WEST MANAGEMENT, INC., a California corporation

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

	 	 	 	 	 
	 	TARRAGON MANAGEMENT, INC., a Nevada corporation

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Its:  	 	 
	 

Reaffirmation of Manager’s Consents

3 of 3

 

EXHIBIT A

COMMITMENTS

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Lender	 	A Note	 	B Note	 	C Note	 	D Note	 	Total Commitment
	General Electric Capital Corporation
	 	$	321,442,000	 	 	$	69,558,000	 	 	$	20,000,000	 	 	$	20,000,000	 	 	$431,000,000, with a Maximum
Loan Amount not to exceed $411,000,000 at any time

 

 

EXHIBIT B

ALLOCATED LOAN AMOUNTS

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Total Allocated
	Property	 	Note A1	 	Note B2	 	Note C3	 	Note D	 	Loan Amount
	Woodcliff Estates
	 	$	28,268,200	 	 	$	6,117,053	 	 	$	1,853,652	 	 	$	1,853,652	 	 	$	38,092,558	 
	Heather Hill
	 	$	27,538,134	 	 	$	5,937,432	 	 	$	1,799,222	 	 	$	1,799,222	 	 	$	36,974,011	 
	Lofts at the Mills
	 	$	23,212,566	 	 	$	5,023,047	 	 	$	1,522,135	 	 	$	1,522,135	 	 	$	31,279,884	 
	The Links at Georgetown
	 	$	21,994,861	 	 	$	4,759,544	 	 	$	1,442,286	 	 	$	1,442,286	 	 	$	29,638,976	 
	Whalers-Nutmeg
	 	$	20,760,387	 	 	$	4,492,412	 	 	$	1,361,337	 	 	$	1,361,337	 	 	$	27,975,472	 
	The Club at Danforth
	 	$	19,715,046	 	 	$	4,266,207	 	 	$	1,292,790	 	 	$	1,292,790	 	 	$	26,566,832	 
	The Vintage at Legacy
	 	$	18,992,842	 	 	$	4,109,926	 	 	$	1,245,432	 	 	$	1,245,432	 	 	$	25,593,633	 
	Ocean Beach Apartments
	 	$	17,799,880	 	 	$	3,851,777	 	 	$	1,167,205	 	 	$	1,167,205	 	 	$	23,986,068	 
	The Vintage at Plantation Bay
	 	$	16,927,223	 	 	$	3,662,940	 	 	$	1,109,983	 	 	$	1,109,982	 	 	$	22,810,129	 
	River City Landing
	 	$	14,182,058	 	 	$	3,068,904	 	 	$	929,972	 	 	$	929,971	 	 	$	19,110,906	 
	Vintage at the Park
	 	$	13,548,090	 	 	$	2,931,718	 	 	$	888,399	 	 	$	888,399	 	 	$	18,256,607	 
	The Liberty Building
	 	$	9,775,265	 	 	$	2,115,303	 	 	$	641,001	 	 	$	641,001	 	 	$	13,172,570	 
	200 Fountain-Exec. House
	 	$	9,641,704	 	 	$	2,086,402	 	 	$	632,243	 	 	$	632,243	 	 	$	12,992,592	 
	Vintage at Madison Crossing
	 	$	9,557,630	 	 	$	2,068,208	 	 	$	626,730	 	 	$	626,730	 	 	$	12,879,298	 
	Parkview Apartments
	 	$	9,220,275	 	 	$	1,995,207	 	 	$	604,608	 	 	$	604,608	 	 	$	12,424,699	 
	Forest Park Apartments
	 	$	9,043,518	 	 	$	1,956,958	 	 	$	593,018	 	 	$	593,018	 	 	$	12,186,511	 
	Sagamore Hills
	 	$	8,736,275	 	 	$	1,890,473	 	 	$	572,871	 	 	$	572,871	 	 	$	11,772,489	 

 

			
	1	 	The outstanding principal amount of the A Notes as
of the date hereof is $305,000,000.
	 
	2	 	The outstanding principal amount of the B Notes as
of the date hereof is $66,000,000.
	 
	3	 	The outstanding principal amount of the C Notes as
of the date hereof is $19,883,369. The total outstanding principal amount of
the A Notes, B Notes and C Notes as of the date hereof is $390,883,369.

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Groton Towers
	 	$	6,867,451	 	 	$	1,486,071	 	 	$	450,325	 	 	$	450,325	 	 	$	9,254,172	 
	Autumn Ridge
	 	$	4,309,329	 	 	$	932,511	 	 	$	282,579	 	 	$	282,579	 	 	$	5,806,997	 
	Lakeview Apartments
	 	$	4,052,196	 	 	$	876,869	 	 	$	265,718	 	 	$	265,718	 	 	$	5,460,501	 
	278 Main Street-Giannotti
	 	$	3,832,599	 	 	$	829,349	 	 	$	251,318	 	 	$	251,318	 	 	$	5,164,585	 
	Hamden Centre
	 	$	3,795,835	 	 	$	821,394	 	 	$	248,907	 	 	$	248,907	 	 	$	5,115,044	 
	Dogwood Hills
	 	$	3,328,635	 	 	$	720,295	 	 	$	218,271	 	 	$	218,271	 	 	$	4,485,472	 

 

 

EXHIBIT C

FORM OF LOCKBOX AGREEMENT

(See Attached)

 

 

SCHEDULE 3A

	 	 	 	 	 	 	 	 	 
	Cross Collateral Guaranty - each dated as of	 	Original Related	 	Revised Related Loans
	November 30, 2005	 	Loans Maximum Amount	 	Maximum Amount
	(1) Secured Cross Collateral Guaranty executed by and
between Autumn Ridge Apartments, LLC and Administrative Agent
	 	$	385,475,582	 	 	$	405,193,003	 
	(2) Secured Cross Collateral Guaranty executed by and
between Dogwood Hills Apartments, LLC and Administrative Agent
	 	$	386,732,799	 	 	$	406,514,528	 
	(3) Secured Cross Collateral Guaranty executed by and
between Forest Park Tarragon, LLC and
Administrative Agent
	 	$	379,406,506	 	 	$	398,813,489	 
	(4) Secured Cross Collateral Guaranty executed by and between
Ansonia Acquisitions I, LLC and Administrative Agent
	 	$	291,128,620	 	 	$	306,020,109	 
	(5) Secured Cross Collateral Guaranty executed by and between
Hamden Centre Apartments, LLC and Administrative Agent
	 	$	386,133,864	 	 	$	405,884,956	 
	(6) Secured Cross Collateral Guaranty executed by and between
Ansonia Liberty, LLC and Administrative Agent
	 	$	378,468,431	 	 	$	397,827,430	 
	(7) Secured Cross Collateral Guaranty executed by and between
Ocean Beach Apartments, LLC and Administrative Agent
	 	$	368,181,138	 	 	$	387,013,932	 
	(8) Secured Cross Collateral Guaranty executed by and between
West Dale National Associates, L.P. and Administrative Agent
	 	$	378,639,651	 	 	$	398,007,408	 
	(9) Secured Cross Collateral Guaranty executed by and between
Manchester Tarragon, LLC and Administrative Agent
	 	$	356,328,985	 	 	$	374,555,531	 
	(10) Secured Cross Collateral Guaranty executed by and between
Danforth Apartment Owners, L.L.C. and Administrative Agent
	 	$	365,725,957	 	 	$	384,433,168	 
	(11) Secured Cross Collateral Guaranty executed by and between
Tarragon Huntsville Apartments, L.L.C. and Administrative Agent
	 	$	378,747,431	 	 	$	398,120,702	 

 

 

	 	 	 	 	 	 	 	 	 
	Cross Collateral Guaranty - each dated as of	 	Original Related	 	Revised Related Loans
	November 30, 2005	 	Loans Maximum Amount	 	Maximum Amount
	(12) Secured Cross Collateral Guaranty executed by and between
Heather Limited Partnership and Administrative Agent
	 	$	355,825,211	 	 	$	374,025,989	 
	(13) Secured Cross Collateral Guaranty executed by and between
Tarragon Savannah I, L.L.C. and Administrative Agent
	 	$	376,901,655	 	 	$	396,180,512	 
	(14) Secured Cross Collateral Guaranty executed by and between
Tarragon Savannah II, L.L.C. and Administrative Agent
	 	$	376,901,655	 	 	$	396,180,512	 
	(15) Secured Cross Collateral Guaranty executed by and between
Heron Cove National, Inc. and Administrative Agent
	 	$	372,819,067	 	 	$	391,889,096	 
	(16) Secured Cross Collateral Guaranty executed by and between
Vintage Legacy Lakes National, L.P. and Administrative Agent
	 	$	366,651,799	 	 	$	385,406,367	 
	(17) Secured Cross Collateral Guaranty executed by and between
Plantation Bay Apartments, L.L.C. and Administrative Agent
	 	$	369,299,854	 	 	$	388,189,873	 
	(18) Secured Cross Collateral Guaranty executed by and between
Summit/Tarragon Murfreesboro, L.L.C. and Administrative Agent
	 	$	373,631,793	 	 	$	392,743,393	 

 

 

SCHEDULE 3A(i)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Autumn Ridge Apartments, LLC and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	405,193,003	 

 

 

SCHEDULE 3A(ii)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Dogwood Hills Apartments, LLC and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	406,514,528	 

 

 

SCHEDULE 3A(iii)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Forest Park Tarragon, LLC and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	398,813,489	 

 

 

SCHEDULE 3A(iv)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Ansonia Acquisitions I, LLC and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	306,020,109	 

 

 

SCHEDULE 3A(v)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Hamden Centre Apartments, LLC and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	405,884,956	 

 

 

SCHEDULE 3A(vi)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Ansonia Liberty, LLC and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	397,827,430	 

 

 

SCHEDULE 3A(vii)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Ocean Beach Apartments, LLC and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	387,013,932	 

 

 

SCHEDULE 3A(viii)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between West Dale National Associates, L.P. and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	TOTAL:
	 	$	398,007,408	 

 

 

SCHEDULE 3A(ix)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Manchester Tarragon, LLC and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	374,555,531	 

 

 

SCHEDULE 3A(x)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Danforth Apartment Owners, L.L.C. and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 	 
	Related Borrower	 	 	Related Loan Amount
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	TOTAL:
	 	$	41,921,035	 

 

 

SCHEDULE 3A(xi)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Tarragon Huntsville Apartments, L.L.C. and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	398,120,702	 

 

 

SCHEDULE 3A(xii)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Heather Limited Partnership and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	374,025,989	 

 

 

SCHEDULE 3A(xiii)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Tarragon Savannah I, L.L.C. and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	396,180,512	 

 

 

SCHEDULE 3A(xiv)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Tarragon Savannah II, L.L.C. and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	396,180,512	 

 

 

SCHEDULE 3A(xv)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Heron Cove National, Inc. and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	TOTAL:
	 	$	49,376,961	 

 

 

SCHEDULE 3A(xvi)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Vintage Legacy Lakes National, L.P. and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Summit/Tarragon Murfreesboro, L.L.C., a Tennessee
limited liability company
	 	$	18,256,607	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	385,406,367	 

 

 

SCHEDULE 3A(xvii)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Plantation Bay Apartments, L.L.C. and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	TOTAL:
	 	$	45,677,738	 

 

 

SCHEDULE 3A(xviii)

Schedule 1 to Secured Cross Collateral Guaranty executed

by and between Summit/Tarragon Murfreesboro, L.L.C. and Administrative Agent

SCHEDULE 1

RELATED BORROWERS AND RELATED LOANS

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Ansonia Acquisitions I, LLC, a Connecticut limited
liability company
	 	$	104,979,891	 
	Ansonia Liberty, LLC, a Connecticut limited liability
company
	 	$	13,172,570	 
	Autumn Ridge Apartments, LLC, a Connecticut limited
liability company
	 	 	5,806,997	 
	Danforth Apartment Owners, L.L.C., a Florida limited
liability company
	 	$	26,566,832	 
	Dogwood Hills Apartments, LLC, a Connecticut limited
liability company
	 	$	4,485,472	 
	Forest Park Tarragon, LLC, a Connecticut limited
liability company
	 	$	12,186,511	 
	Hamden Centre Apartments, LLC, a Connecticut limited
liability company
	 	$	5,115,044	 
	Heather Limited Partnership, a Maryland limited
partnership
	 	$	36,974,011	 
	Heron Cove National, Inc., a Florida corporation
	 	$	19,110,906	 
	Manchester Tarragon, LLC, a Connecticut limited
liability company
	 	$	36,444,469	 
	Ocean Beach Apartments, LLC, a Connecticut limited
liability company
	 	$	23,986,068	 
	Plantation Bay Apartments, L.L.C., a Florida limited
liability company
	 	$	22,810,129	 
	Tarragon Huntsville Apartments, L.L.C., an Alabama
limited liability company
	 	$	12,879,298	 
	Tarragon Savannah I, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 
	Tarragon Savannah II, L.L.C., a Georgia limited
liability company
	 	$	14,819,488	 

 

 

	 	 	 	 	 
	Related Borrower	 	Related Loan Amount
	Vintage Legacy Lakes National, L.P., a Texas limited
partnership
	 	$	25,593,633	 
	West Dale National Associates, L.P., a Texas limited
partnership
	 	$	12,992,592	 
	TOTAL:
	 	$	392,743,393	 

 

 

SCHEDULE 8

AMENDED MORTGAGES

     1.      First Amendment to First Mortgage and Assignment of Rents and Leases, dated as of June 30,
2006, by Autumn Ridge Apartments, LLC.

     2.      First Amendment to Second Mortgage, dated as of June 30, 2006, by Autumn Ridge Apartments,
LLC.

     3.      First Amendment to First Mortgage and Assignment of Rents and Leases, dated as of June 30,
2006, by Dogwood Hills Apartments, LLC.

     4.      First Amendment to Second Mortgage, dated as of June 30, 2006, by Dogwood Hills
Apartments, LLC.

     5.      First Amendment to First Mortgage and Assignment of Rents and Leases, dated as of June 30,
2006, by Forest Park Tarragon, LLC.

     6.      First Amendment to Second Mortgage, dated as of June 30, 2006, by Forest Park
Tarragon, LLC.

     7.      First Amendment to First Mortgage and Assignment of Rents and Leases, dated as of June 30,
2006, by Ansonia Acquisitions I, LLC.

     8.      First Amendment to Second Mortgage, dated as of June 30, 2006, by Ansonia Acquisitions
I, LLC.

     9.      First Amendment to First Mortgage and Assignment of Rents and Leases, dated as of June 30,
2006, by Hamden Centre Apartments, LLC.

     10.      First Amendment to Second Mortgage, dated as of June 30, 2006, by Hamden Centre
Apartments, LLC.

     11.      First Amendment to First Mortgage and Assignment of Rents and Leases, dated as of June 30,
2006, by Ansonia Liberty, LLC.

     12.      First Amendment to Second Mortgage, dated as of June 30, 2006, by Ansonia Liberty,
LLC.

     13.      First Amendment to First Mortgage and Assignment of Rents and Leases, dated as of June 30,
2006, by Ocean Beach Apartments, LLC.

     14.      First Amendment to Second Mortgage, dated as of June 30, 2006, by Ocean Beach
Apartments, LLC.

     15.      First Amendment to First Mortgage and Assignment of Rents and Leases, dated as of June 30,
2006, by West Dale National Associates, L.P.

 

 

     16.      First Amendment to Second Mortgage, dated as of June 30, 2006, by West Dale
National Associates, L.P.

     17.      First Amendment to First Mortgage and Assignment of Rents and Leases, dated as of
June 30, 2006, by Manchester Tarragon, LLC.

     18.      First Amendment to Second Mortgage, dated as of June 30, 2006, by Manchester
Tarragon, LLC.

     19.      First Amendment to (i) First Amended, Restated and Consolidated Deed of Trust,
Assignment of Rents and Leases, Security Agreement and Fixture Filing and (ii) Assignment of Rents
and Leases, dated as of June 30, 2006, by Heather Limited Partnership.

     20.      First Amendment to Indemnity Deed of Trust, Assignment of Rents and Leases, Security
Agreement and Fixture Filing, dated as of June 30, 2006, by Heather Limited Partnership.

     21.      First Amendment to (i) First Amended and Restated Mortgage, Assignment of Rents and
Leases, Security Agreement and Fixture Filing and (ii) Assignment of Rents and Leases, dated as of
June 30, 2006, by Danforth Apartment Owners, L.L.C.

     22.      First Amendment to Second Mortgage, Assignment of Rents and Leases, Security
Agreement and Fixture Filing, dated as of June 30, 2006, by Danforth Apartment Owners, L.L.C.

     23.      First Amendment to (i) First Amended and Restated Mortgage, Assignment of Rents and
Leases, Security Agreement and Fixture Filing and (ii) Assignment of Rents and Leases, dated as of
June 30, 2006, by Heron Cove National, Inc.

     24.      First Amendment to Second Mortgage, Assignment of Rents and Leases, Security
Agreement and Fixture Filing, dated as of June 30, 2006, by Heron Cove National, Inc.

     25.      First Amendment to (i) First Amended and Restated Mortgage, Assignment of Rents and
Leases, Security Agreement and Fixture Filing and (ii) Assignment of Rents and Leases, dated as of
June 30, 2006, by Plantation Bay Apartments, L.L.C.

     26.      First Amendment to Second Mortgage, Assignment of Rents and Leases, Security
Agreement and Fixture Filing, dated as of June 30, 2006, by Plantation Bay Apartments, L.L.C.

     27.      First Amendment to (i) First Mortgage, Assignment of Rents and Leases, Security
Agreement and Fixture Filing and (ii) Assignment of Rents and Leases, dated as of June 30, 2006, by
Tarragon Huntsville Apartments, L.L.C.

     28.      First Amendment to Second Mortgage, Assignment of Rents and Leases, Security
Agreement and Fixture Filing, dated as of June 30, 2006, by Tarragon Huntsville Apartments,
L.L.C.

 

 

     29.      First Amendment to (i) First Deed to Secure Debt, Assignment of Rents and Leases,
Security Agreement and Fixture Filing and (ii) Assignment of Rents and Leases, dated as of June 30,
2006, by Tarragon Savannah I, L.L.C.

     30.      First Amendment to Second Deed to Secure Debt, Assignment of Rents and Leases,
Security Agreement and Fixture Filing, dated as of June 30, 2006, by Tarragon Savannah I,
L.L.C.

     31.      First Amendment to (i) First Deed to Secure Debt, Assignment of Rents and Leases,
Security Agreement and Fixture Filing and (ii) Assignment of Rents and Leases, dated as of June 30,
2006, by Tarragon Savannah II, L.L.C.

     32.      First Amendment to Second Deed to Secure Debt, Assignment of Rents and Leases,
Security Agreement and Fixture Filing, dated as of June 30, 2006, by Tarragon Savannah II,
L.L.C.

     33.      Second Deed of Trust, Assignment of Rents and Leases, Security Agreement and Fixture
Filing, dated as of June 30, 2006, by Vintage Legacy Lakes National, L.P.

     34.      Second Assignment of Rents and Leases, dated as of June 30, 2006, by Vintage Legacy Lakes
National, L.P.

     35.      First Amendment to First Deed of Trust and Assignment of Rents and Leases, dated as of
June 30, 2006, by Summit/Tarragon Murfreesboro, L.L.C.

     36.      First Amendment to Second Deed of Trust, dated as of June 30, 2006, by Summit/Tarragon
Murfreesboro, L.L.C.

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