Document:

ex1024oasisassgnmtomgmt

                                                                         EXHIBIT 10.24                                                 Freddie Mac Loan Number: 504021303                                                           Property Name: The Oasis                 ASSIGNMENT OF MANAGEMENT AGREEMENT AND                    SUBORDINATION OF MANAGEMENT FEES                                  (Revised 7-12-2016)   THIS  ASSIGNMENT    OF MANAGEMENT      AGREEMENT    AND   SUBORDINATION    OF  MANAGEMENT FEES     ("Assignment") is made effective as of the 31st day of July. 2018, by  and among STAR  OASIS,  LLC, a Delaware limited liability company ("Borrower"), PNC  BANK,   NATIONAL    ASSOCIATION,    a national banking association ("Lender"). and  STEADFAST    .MANAGEMENT     COMPANY,    INC .. a California corporation ("Property  Manager").                                     RECITALS:  A.    Borrower has requested that Lender make a loan to Borrower ("Loan"). The Loan will be        evidenced by a Multifamily Note from Borrower to Lender effective as of the date of this        Assignment ("Note"). The Note is secured by, among other things, a Multifamily Loan        and Security Agreement ("Loan Agreement") and a Multifamily Mortgage. Deed of        Trust, or Deed to Secure Debt ("Security Instrument"), dated as of the date of this        Assignment, which grants Lender a lien on the property encumbered by the Security        Instrument ("Mortgaged Property"). The Note, the Loan Agreement, the Security        Instrument, this Assignment and  any of the other documents evidencing the Loan are        collectively referred to as the "Loan Documents". Other capitalized terms used but not        defined in this Assignment will have the meanings given to those terms in the Loan        Agreement.  B.    Pursuant to a Management Agreement between Borrower and  Property Manager        ("Management Agreement") (a true and correct copy of which is attached as Exhibit B ),        Borrower employed Property Manager exclusively to lease, operate and manage the        Mortgaged Property, and Property Manager is entitled to certain management fees        ("Management Fees") pursuant to the Management Agreement.   C.    Lender requires as a condition to the making of the Loan that Borrower assign the        Management  Agreement and that Property Manager subordinate its interest in the        Management Fees in lien and payment to the Loan as set forth below.  For good and valuable consideration the parties agree as follows:   1.    Assignment of Management Agreement. As additional collateral security for the Loan,        Borrower conditionally transfers. sets over. and assigns to Lender all of Borrower's right,        title and interest in and to the Management Agreement and all extensions and renewals.        This  transfer and assignment will automatically become a present, unconditional        assignment. at Lender's option, upon a default by Borrower under the Note, the Loan        Agreement, the Security Instrument or any of the other Loan Documents (each, an        "Event of Default''), and the failure of Borrower to cure such Event of Default within        any applicable grace period.   2.    Subordination of Management  Fees. The Management  Fees and all rights and        privileges of Property Manager to the Management Fees are and will at all times continue        to be subject and unconditionally subordinate in all respects in lien and payment to the   Assignment of Management Agreement and  Subordination of Management Fees  

 

      lien and payment of the Loan Agreement, the Security Instrument, the Note, and the other        Loan  Documents, and to any  renewals, extensions, modifications, assignments,        replacements, or consolidations of the Loan Documents and the rights, privileges, and        powers of Lender under the Note, the Loan Agreement, the Security Instrument, or any of        the other Loan Documents.   3.    Estoppel. Property Manager and Borrower represent and warrant that all of the following        are true as of the date of this Assignment:         (a)   The Management Agreement is in full force and effect and has not been modified,              amended or assigned other than pursuant to this Assignment.         (b)   Neither Properly Manager nor Borrower is in default under any of the tem1s.              covenants or provisions of the Management Agreement and Property Manager              knows of no event which. but for the passage of time or the giving of notice or              both, would constitute an event of default under the Management Agreement.         (C)   Neither Properly Manager nor Borrower has commenced any action or given or              received any notice for the purpose of terminating the Management Agreement.         (d)   The Management  Fees and all other sums due and payable to the Property              Manager under the Management Agreement have been paid in full.  4.    Agreement by Borrower  and Property Manager. Borrower and Property Manager        agree that if there is an Event of Default by Borrower (continuing beyond any applicable        grace period) under the Note, the Loan Agreement, the Security Instrument or any of the        other Loan Documents during the term of this Assignment or upon the occurrence of any        event which would entitle Lender to terminate the Management Agreement in accordance        with the terms of the Loan Documents, Lender may tem1inate the Management        Agreement without payment of any cancellation fee or penalty and require Property        Manager to transfer its responsibility for the management of the Mortgaged Property to a        management company selected by Lender in Lender's sole discretion, effective as of the        date set forth in Lender's notice to Property Manager. Following any such termination,        Property Manager agrees to apply all rents, security deposits. issues, proceeds and profits        of the Mortgaged Property in accordance with Lender's written directions to Property        Manager.   5.    Lender's Right to Replace Property Manager. If Lender, in Lender's reasonable        discretion, at any time during the term of this Assignment, determines that the Mortgaged        Property is not being managed in accordance with generally accepted management        practices for properties similar to the Mortgaged Property, Lender will deliver written        notice to Borrower and Property Manager, which notice will specify with particularity the        grounds for Lender's determination. If' Lender reasonably determines that the conditions        specified in Lender's notice are not remedied to Lender's reasonable satisfaction by        Borrower or Property Manager within 30 days from receipt of such notice or that        Borrower or Property Manager have failed to diligently undertake correcting such        conditions within such 30-day period, Lender may direct Borrower to terminate Property        Manager as manager  of the Mortgaged Property and terminate the Management        Agreement without payment of any cancellation fee or penalty and to replace Property        Manager with a management company acceptable to Lender in Lender's sole discretion        pursuant to a management agreement acceptable to Lender in Lender's sole discretion.    Assignment of 1"Ianagcment Agreement and  Subordination of I\'lanagement Fees                                      Pagc2  

 

6.    Receipt of Management Fees. Property Manager will not be obligated to return or        refund to Lender any Management Fees or other fee, commission or other amount        received by Property Manager prior to the occurrence of the Event of Default, and to        which Property Manager was entitled under the Management Agreement. If the Property        Manager receives any Management Fees after it has received notice of an Event of        Default, Property Manager agrees that such Management Fees will be received and held        in trust for Lender. to be applied by Lender to amounts due under the Loan Documents.   7.    Consent and Agreement by Property Manager. Property Manager acknowledges and        consents to this Assignment and agrees that Property Manager will act in conforn1ity with        the provisions of this Assignment and Lender's rights under this Assignment or otherwise        related to the Management Agreement. If the responsibility for the management of the        Mortgaged Property is transferred from Property Manager in accordance with the        provisions of this Assignment, then Property Manager will fully cooperate in transferring        its responsibility to a new management company and complete such transfer no later than        30 days from the date the Management Agreement is tenninated. Further. Property        Manager agrees as follows:        (a)   It will not contest or impede the exercise by Lender of any right Lender has under              or in connection with this Assignment.        (b)   It will give at least 30 days prior written notice to Lender of its intention to              terminate the Management Agreement or otherwise discontinue its management              of the Mortgaged Property, in the manner provided for in this Assignment.         (c)   It will not amend any of the provisions or terms of the Management Agreement              without the prior consent of Lender.   8.    Termination. When the Loan is paid in full and the Security Instrument is released or        assigned of record, this Assignment and all of Lender's right, title and interest hereunder        with respect to the Management Agreement will terminate.  9.    Notices.        (a)   All notices under or concerning this Assignment ("Notice") will be in writing.              Each Notice will be deemed given on the earliest to occur of: (i) the date when              the Notice is received by the addressee, (ii) the first Business Day after the Notice              is delivered to a recognized overnight courier service, with arrangements made for              payment of charges for next Business Day delivery, or (iii) the third Business Day              after the Notice is deposited in the United States mail with postage prepaid,              certified mail, return receipt requested. Addresses for Notice are as follows:                If to Lender:       PNC Bank. National Association                                   2690 I Agoura Road, Suite 200                                   Calabasas Hills. California 9130 I                                   Attention: Loan Servicing Manager    Assignment of 1\.'lanagcment Agreement and  Subordination of Management Fees                                         Page 3  

 

             If to Borrower:     STAR  Oasis, LLC                                   c/o Steadfast Companies                                   18100 Von Karman Avenue, Suite 500                                   Irvine, California 92612                                   Attention - General Counsel:  Ana Marie de! Rio                If to Property      Steadfast Management Company, Inc.               Manager:            c/o Steadfast Companies                                   18100 Von Karman Avenue, Suite 500                                   Irvine, California 92612                                   Attention - General Counsel:  Ana Marie de] Rio         (b)   Any party to this Assignment may change the address to which Notices intended              for it are to be directed by means of Notice given to the other parties in              accordance with this Section 9. Each party agrees that it will not refuse or reject              delivery of any Notice given in accordance with this Section 9, that it will              acknowledge, in writing, the receipt of any Notice upon request by the other party              and that any Notice rejected or refused by it will be deemed for purposes of this              Section 9 to have been received by the rejecting party on the date so refused or              rejected, as conclusively established by the records of the U.S. Postal Service or              the courier service.  10.   Governing Law; Consent to Jurisdiction and Venue.        (a)   This Assignment will be construed in accordance with and governed by the laws              of the Property Jurisdiction.        (b)   Borrower and Property Manager agree that any controversy arising under or in              relation to this Assignment may be litigated in the Property Jurisdiction. The state              and federal courts and authorities with jurisdiction in the Property Jurisdiction              will have jurisdiction over all controversies that may arise under or in relation to              this Assignment. Borrower and Property Manager irrevocably consent to service,              jurisdiction and venue of such courts for any such litigation and waive any other              venue to which it might be entitled by virtue of domicile, habitual residence or              otherwise. However, nothing in this Section 10 is intended to limit Lender's right              to bring any suit, action or proceeding relating to matters under this Assignment              in any court of any other jurisdiction.  11.   Captions, Cross References and Exhibits. The captions assigned to provisions of this        Assignment are for convenience only and will be disregarded in construing this        Assignment. Any reference in this Assignment to an "Exhibit" or a "Section," unless        otherwise explicitly provided, will be construed as referring, respectively, to an Exhibit        attached to this Assignment or to a section of this Assignment. All Exhibits attached to or        referred to in this Assignment are incorporated by reference into this Assignment.   12.   Number and Gender. Use of the singular in this Assignment includes the plural, use of        the plural includes the singular, and use of one gender includes all other genders, as the        context may require.   13.   No Partnership. This Assignment is not intended to, and will not, create a partnership or        joint venture among the parties, and no party to this Assignment will have the power or        authority to bind any other party except as explicitly provided in this Assignment.   Assignment of l\'lanagcmcnt Agreement and  Subordination of Management Fees                                         Page4  

 

14.   Severability. The invalidity or unenforceability of any provision of this Assignment will        not affect the validity of any other provision, and all other provisions will remain in full        force and effect.  15.   Entire Assignment. This Assignment contains the entire agreement among the parties as        to the rights granted and the obligations assumed in this Assignment.  16.   No Waiver; No Remedy  Exclusive. Any forbearance by a party to this Assignment in        exercising any right or remedy given under this Assignment or existing at law or in        equity will not constitute a waiver of or preclude the exercise of that or any other right or        remedy. Unless otherwise explicitly provided, no remedy under this Assignment is        intended to be exclusive of any other available remedy, but each remedy will be        cumulative and will be in addition to other remedies given under this Assignment or        existing at law or in equity.   17.   Third Party Beneficiaries. Neither any creditor of any party to this Assignment, nor any        other person, is intended to be a third party beneficiary of this Assignment.  18.   Further Assurances and Corrective Instruments. To the extent permitted by law, the        parties will, from time to time. execute, acknowledge and deliver. or cause to be        executed, acknowledged and delivered, such supplements to this Assignment and such        further instruments as may reasonably be required for carrying out the intention of or        facilitating the perforn1ance of this Assignment.  19.   Counterparts. This Assignment may be executed in multiple counterparts, each of which        will constitute an original document and all of which together will constitute one        agreement.  20.   Indemnity. By executing this Assignment Borrower agrees to indemnify and hold        harmless Lender and its successors and assigns from and against any  and all losses.        claims, damages, liabilities and expenses including Attorneys' Fees and Costs, which        may be imposed or incurred in connection with this Assignment.  21.   Costs and Expenses. Wherever pursuant to this Assignment it is provided that Borrower        will pay any costs and expenses, such costs and expenses will include Lender's        Attorneys' Fees and Costs.   22.   Determinations by Lender. In any instance where the consent or approval of Lender        may be given or is required, or where any determination, judgment or decision is to be        rendered by Lender under this Assignment, the granting, withholding or denial of such        consent or approval and the rendering of such detern1ination, judgment or decision will        be made or exercised by Lender (or its designated representative) at its sole and exclusive        option and in its sole and absolute discretion and will be final and conclusive. except as        may be otherwise expressly and specifically provided in this Assignment.  23.   Successors and Assigns. This Assignment will be binding upon and inure to the benefit        of Borrower, Lender and Property Manager and their respective successors and assigns        forever.   24.   Secondary Market. Lender may sell, transfer and deliver the Note and assign the Loan        Agreement. the Security Instrument, this Assignment and the other Loan Documents to        one or more investors in the secondary mortgage market ("Investors"). In connection   Assignment of Management Agreement and  Subordination of Management Fees                                         Pages  

 

      with such sale, Lender may retain or assign responsibility for serv1cmg the Loan,        including the Note, the Loan Agreement, the Security Instrument, this Assignment and        the other Loan Documents. or may delegate some or all of such responsibility and/or        obligations to a servicer including any subservicer or master servicer, on behalf of the        Investors. All references to Lender in this Assignment will refer to and include any such        servicer to the extent applicable.   25.   Attached Exhibits. The following Exhibits, if marked with an "X" in the space        provided, are attached to this Assignment:                  Exhibit A     Modifications to Assignment                  Exhibit B     Copy of Management Agreement   IN WITNESS  WHEREOF    the undersigned have executed this Assignment as of the date and  year first written above.                             JEND OF PAGE- SIGNATURES TO FOLLOW(    Assignment of' Management Agreement and  Subordination of Management Fees                                         Page6  

 

                                      BORROWER:                                         STAR OASIS, LLC, a Delaware limited liability                                           company                                        By:  Steadfast Apartment Advisor, LLC, a                                             Delaware limited liability company, its                                             Manager                                              By:                                                 Ella S. Neyland    '                                                 President    Assignment of Management Agreement and  Subordination of Management Fees                                           PageS-1  

 

                                    LENDER:                                       PNC  BANK, NATIONAL ASSOCIATION,      a                                         national banking association                                        By                                         Kill.~L-(,c'D Tyler  ~                                         Vice President    Assignment of Management Agreement and  Subordination of Management Fees                                        Page S-2  

 

                                           PROPERTY MANAGER:                                             STEADFAST MANAGEMENT COMPANY,                                                 INC., a Calin   ia corporation    Assignment of I\.Innagement Agreement and  Subordination of l\Innngcmcnt Fees                                                    Pnge S-3  

 

                                  EXHIBIT A                        MODIFICATIONS    TO ASSIGNMENT   The following modifications are made to the text of the Assignment that precedes this Exhibit.  I.    Section 3(a) is deleted in its entirety and replaced with the following:         (a)   The Management Agreement is in full force and effect and has not been modified,              m: amended or assigAed otll.er thaH 13t1rst1aAt lo this AssigmHeHt. There arc no              assignments of the Management Agreement that remain in effect other than              pursuant to this Assignment.  2.    Section 6 is deleted in its entirety and replaced with the following:        6.    Receipt of Management Fees. Manager will not be obligated to return or refund              to Lender any Management Fees or other fee, commission or other amount              received by Property Manager prior to the occuITence of the Event of Default, and              to which Property Manager was entitled under the Management Agreement. If the              Property Manager receives any Management Fees after it has received notice of an              Event of Default, Property Manager agrees that such Management Fees will be              received and held in trust for Lender, to be applied by Lender to amounts due under              the Loan Documents; provided. however, that nothing herein shall prevent              Propertv Manager from terminating the Management Agreement in the event              Propertv Manager is not paid all fees due to it under the Management              Agreement.    Assignment of Management Agreement and  Subordination of Management Fees                                       Page A-1  

 

                                      EXHIBITB                               MANAGEMENT AGREEMENT                                        See Attached    Assignment of Management Agreement and  Subordination of Management Fees                                                Page B-1  

 

               PROPERTY MANAGEMENT AGREEMENT         THIS PROPERTY  MANAGEivIENT   AGREEMENT    (this ··Agreement"") is made and  entered into as of December 19.2014 (the --Effective Date..  ). by and between STAR OASIS. LLC,  a Delaware limited liability company (..  Owncr··i. and STEADFAST MANAGEMENT  COMPANY.   INC., a California corporation (..  Manager'").                                   ARTICLE 1                                 DEFINITIONS         Section 1.1 Definitions. The following terms shall have the following meanings when  used in this Agreement:         .. Agreement"" has the meaning given in the introductory paragraph .         .. Annual Business Plan .. has the meaning given in Section 3.11 (a).         "Capital Budget"" has the meaning given in Section 3.11 (a).         --Depositon··· means such bank or federally-insured or other financial institution as Owner  shall designate in writing.         ··Effective Date..  has the meaning given in the introductory paragraph.         ··Fiscal Year..  means the calendar year beginning January I and ending December 31 of  each calendar year. or such other fiscal year as determined by Owner and of which Manager is  notified in writing; provided that the first Fiscal Year of this Agreement shall be the period  beginning on the Effective Date and ending on December 31 of the calendar year in which the  Effective Date occurs.         --Governmental Requirements .. has the meaning given in Section 3.14 .         .. Gross Collections .. means all amounts actually collected as rents or other charges for use  and occupancy of apartment units and from users of garage spaces (if any). leases of other non­ dwelling facilities in the Property and concessionaires (if any) in respect of the Property. including  furniture rental, parking fees, forfeited security deposits, application fees, late charges. income  from coin-operated machines. proceeds from rental interruption insurance, and other  miscellaneous income collected at the Property: excluding, however. all other receipts. including  but not limited to, income derived from interest on investments or otherwise, proceeds of claims  on account of insurance policies (other than rental interruptions insurance), abatement of taxes,  franchise fees. and awards arising out of eminent domain proceedings, discounts and dividends on  insurance policies.         --Hazardous Materials .. means any material defined as a hazardous substance under the  Comprehensive Environmental Response. Compensation and Liability Act of 1980, the Resource  Conservation and Recovery Act. or any state or local statute regulating the storage. release.  transportation or other disposition of hazardous material. as any of those laws may have been  amended to the date hereof. and the administrative regulations promulgated thereunder prior to the  

 

date hereof, and. whether or not defined as hazardous substances under the foregoing  Governmental Requirements. petroleum products {other  than petroleum products used in  accordance with Governmental Requirements by Owner or its tenants in the usual and ordinary  course of their activities). PCBs and radon gas.         ··Major Capital Improvements·· has the meaning given in Section 3.6.         ··Management Fee·· has the meaning given in Section 4.1.         '"Manager'" has the meaning given in the introductory paragraph.         "'Operating Budget"" has the meaning given in Section 3.11 {a).         ··owner·· has the meaning given in the introductory paragraph.         "'Owner's Representative·· has the meaning given in Section 2.2.         "Pass-Through Amounts" means fees and/or reimbursements for services provided to the  Property but not covered by the Management Fee. as described in Exhibit A attached hereto and  made a part hereof.         "'Propertv·· means the multifamily apartment project listed and described on Exhibit B  attached hereto and made a part hereof.         "'Securitv Deposit Account"" has the meaning given in Section 5.1.         ··State'" means the state in which the Property is located.                                      ARTICLE2            APPOINTMENT OF AGENCY AND          RENTAL RESPONSIBILITY         Section 2.1  Appointment.   Owner hereby appoints Manager and Manager  hereby  accepts appointment as the sole and exclusive leasing agent and manager of the Property on the  terms and conditions set forth herein. Owner warrants and represents to Manager that Owner owns  fee simple title to the Property with all requisite authority to hereby appoint Manager and to enter  into this Agreement.         Section 2.2  Owner's Representative. Owner shall from time to time designate one or  more persons to serve as Owner's representative r·owner's Representative"") in all dealings with  Manager hereunder. Whenever  the approval. consent or other action of Owner is called for  hereunder, such approval. consent or action shall be binding on Owner if specified in writing and  signed by Owner's Representative. The initial Owner"s Representative shall be Ella S. Neyland.  President. Any Owner's Representative may be changed at the discretion of Owner. at any time.  and shall be effective upon Manager's receipt of written notice identifying the new Owner"s  Representative.                                            2  

 

       Section 2.3  Leasing. Manager shall perform all promotional. leasing and management   activities required to lease apartment units in the Property. Throughout the term or this Agreement.   Manager shall use its diligent efforts to lease apartment units in the Property. Manager shall   advertise the Property. prepare and secure advertising signs. space plans. circulars. marketing   brochures and other forms of advertising. Owner hereby authorizes Manager pursuant to the terms   of this Agreement to advertise the Property in conjunction with institutional advertising campaigns   and allocate costs on a pro rata basis among the Properties being advertised (to the extent   authorized by the Annual Business Plan). All inquiries for any leases or renewals or agreements   for the rental of the Property or portions thereof shall be referred to Manager and all negotiations   connected therewith shall be conducted solely by or under the direction of Manager. Manager is   hereby authorized to execute. deliver and renew residential tenant leases in its capacity as manager   pursuant to this Agreement. rvlanager is authorized to utilize the services of apartment locator   services and the fees of such services shall be operating expenses of the Property and. to the extent   paid by Manager. reimbursable by Owner.          Section 2.4  Manager's Standard of Care. Manager shall perform its duties under this   Agreement in a manner consistent with professional prope11y management services. In no event   shall the scope or quality of services provided by Manager for the Property hereunder be less than   those generally performed by professional property managers of similar properties in the market   area where the Property is located. Manager shall make available to Owner the full benefit or the  judgment. experience, and advice of the members and employees ofManagcr·s organization with   respect to the policies to be pursued by Owner in operating the Property. and will perform the   services set forth herein and such other services as may be requested by Owner in managing.   operating. maintaining and servicing the Property.                                       ARTICLE3                     SERVICES TO BE PERFORMED BY MANAGER          Section 3.1  Expense of Owner. All acts performed by Manager in the performance of   its obligations under this Agreement shall be performed as an independent contractor or Owner.   and all obligations or expenses incurred thereby. shall be for the account of. on behalf of. and at   the expense of Owner. except as otherwise spcci lically provided in this Article 3. provided Owner   shall be obligated to reimburse Manager only for the following:                (a)    Costs and Expenses. All costs and expenses incurred by Manager, in its   capacity as Manager pursuant to this Agreement. in connection with the management and   operation of the Property, including but not limited to all compensation, including the cost of   benefits. payable to the employees at the Property and identified in the Operating Budget and taxes   and assessments payable in connection therewith and reasonable training. travel and expenses   associated therewith. all marketing costs. all collection and lease enforcement costs. all   maintenance and repair costs incurred in accordance with Section 3.5 hercoI: all utilities and   related services. all on-site overhead costs and all other costs reasonably incurred by Manager in  the operation and management of the Property. excluding, however. all or Manager·s general  overhead costs. including without limitation. all expenses incurred at Manager"s corporate   headquarters and other Manager office sites other than the property management office located at  the Property (i.e., office expenses. long distance phone calls. postage. copying. supplies. electronic                                            3  

 

data processing and accounting expenses). general accounting and rep011ing expenses for services  included amo1111 Manager·s duties under the Agreement: and             -     ~                  -             (b)  Other. All sums otherwise due and payable by Owner as expenses of the  Property authorized to be incurred by Manager under the terms of this Agreement and the  Operating Budget. including compensation payable under Section 4.1 hereof to Manager for its  services hereunder.         Manager may use employees normally assigned to other work centers or part-time  employees to properly staff the Property. reduced. increased or emergency work load and the like  including the property manager. business manager. assistant managers. leasing directors. or other  administrative personnel. maintenance employees or maintenance supervisors whose wages and  related expenses shall be reimbursed on a pro rata basis for the time actually spent at the Property.  A property manager or business manager at the Property and any other persons performing  functions substantially similar to those of a business manager. including but not limited to assistant  managers, leasing directors. leasing agents. sales directors. sales agents. bookkeepers. and other  administrative and/or maintenance personnel performing work at the site, and on-site maintenance  personnel. shall not be considered executive employees of Manager. All reimbursable payments  made by Manager hereunder shall be reimbursed from funds deposited in an account established  pursuant to Section 5.2 of this Agreement. Manager shall not be obligated to make any advance  to or for the account of Owner nor shall Manager be obligated to incur any liability or obligation  for the account of Owner without assurance that the necessary funds for the discharge thereof will  be provided by Owner. In the performance of its duties as agent and manager of the Property.  Manager shall act solely as an independent contractor of Owner. All debts and liabilities to third  persons incurred by Manager in the course of its operation and management of the Property shall  be the debts and liabilities of Owner only. and Manager shall not be liable for any such debt or  liabilities, except to the extent Manager has exceeded its authority hereunder.         Section 3.2 Covenants Concerning Pavment of Operating Expenses. Owner  covenants to pay all sums for reasonable operating expenses in excess of gross receipts required  to operate the Property upon written notice and demand from Manager within five days atlcr  receipt of written notice for payment thereof.         Section 3.3 Emplovmcnt of Personnel. Manager shall use its diligent efforts to  investigate, hire. pay. supervise and discharge the personnel necessary to be employed by it to  properly maintain. operate and lease the Property. including without limitation a property manager  or business manager at the Property. Such personnel shall in every instance be deemed agents or  employees, as the case may be. of Manager. Owner has no right of supervision or direction of  agents or employees of Manager whatsoever; however, Owner shall have the right to require the  reassignment or termination of any employee. All Owner directives shall be communicated to  Manager's senior level management employees. Manager and all personnel of Manager who  handle or who are responsible for handling Owner·s monies shall be bonded in favor of Owner.  Manager agrees to obtain and keep in effect fidelity insurance in an amount not less than Two  Hundred Fifty Thousand Dollars ($250.000). All reasonable salaries. wages and other  compensation of personnel employed by Manager. including so-called fringe benefits. worker's  compensation. medical and health insurance and the like. shall be deemed to be reimbursable  expenses of Manager. Manager may allow its employees who work at the Property and provide                                        4  

 

services lo the Properly alicr normal business hours. lo reside at the Property for reduced rents (or  renl fee as provided in the Operating Budget) in consideration of their benefit to Owner and the  Property. provided such reduced rents are reflected in the Annual Business Plan.         Section 3.4  Utilitv and Service Contracts. Manager shall. in its capacity as Manager  pursuant to this Agreement. at Owner"s expense. enter into contracts for water. electricity. gas.  fuel. oil. telephone. vermin extermination. trash removal. cable television, security protection and  other services deemed by Manager to be necessary or advisable for the operation of the Property.  Manager shall also. in ils capacity as Manager to this Agreement. al Owncr·s expense. place orders  for such equipment. tools. appliances. materials. and supplies as arc reasonable and necessary to  properly maintain the Properly. Owner agrees to pay or reimburse Manager for all expenses and  liabilities incurred by reason of this Section provided that such amounts arc in accordance with the  Operating Budget.         Section 3.5  Maintenance and Repair of Property. Manager shall use diligent efforts  to maintain, at Owner·s expense. the buildings. appurtenances and grounds of the Property in good  condition and repair, including interior and exterior cleaning. painting and decorating. plumbing.  carpentry and such other normal maintenance and repair work as may be necessary or reasonably  desirable taking into consideration the amount allocated therefor in the Annual Business Plan.  With respect to any expenditure not contemplated by the Annual Business Plan. Manager shall not  incur any individual item of repair or replacement in excess of Five Thousand Dollars (SS.000.00)  unless authorized in writing by Owner"s Representative. except. however. that emergency repairs  immediately necessary for the preservation and safety of the Properly or to avoid the suspension  of any service to the Properly or danger of injury to persons or damage to property may be made  by Manager without the approval ofOwner·s Representative. Owner shall not establish standards  of maintenance and repair that violate or may violate any laws. rules. restrictions or regulations  applicable to Manager or the Property or that expose Manager to risk of liability to tenants or other  persons. Manager  shall not be obligated by this Section to perform any Major Capital  Improvements.         Section 3.6  Supervision of Major  Capital Improvements   or Repairs.   When  requested by Owner in writing or as set forth in an Approved Business Plan. Manager or an affiliate  thereof shall. in its capacity as Manager pursuant to this Agreement. at Owner·s expense supervise  the installation and construction of all Major Capital Improvements to the Property where such  work constitutes other than normal maintenance and repair, for additional compensation as set  forth in a separate agreement. If Owner and tvlanager fail to reach an agreement for Manager"s  additional compensation as provided in this Section 3.6, Owner may contract with a third party to  supervise installation or construction of Major Capital Improvements. In such events. Manager  may, in its capacity as Manager pursuant to this Agreement, negotiate contracts with all necessary  contractors, subcontractors, malerialmen. suppliers. architects. and engineers and may. in its  capacity as Manager pursuant to this Agreement. compromise and settle any dispute or claim  arising therefrom; provided only that ivlanager shall act in good faith and in the best interest of  Owner at all times and Owner shall approve all contracts for such work. Manager will furnish or  will cause to be furnished all personnel necessary for proper supervision of the work and may  assign personnel located at the Property where such work is being performed to such supervisory  work (and such assignment shall not reduce or abate any other fees or compensation owed to                                            5  

 

Manager under this Agreement). For the purposes of this Agreement. the term .. Major Capital  Improvements .. shall mean work having an estimated cost of $25.000 or more.               Owner acknowledges that Manager. or an affiliate of Manager. may bid on any  such work. and that ivlanagcr. or an affiliate of Manager. may be selected to perform part or all or  the work; provided that if Manager desires to select itself. or its affiliate to do any work. it shall  first notify Owner of the terms upon which it. or its affiliate. proposes to contract for the work. and  terms upon which the independent contractors have offered to perform. and shall state the reasons  for preferring itself. or its affiliate. over independent contractors and Owner shall have fifteen days  to disapprove Manager. or its affiliate. and to request performance by an independent contractor.  Only Owner shall have the power to compromise or settle any dispute or claim arising from work  performed by Manager. or its affiliate: and it is expressly understood that the selection of Manager.  or its affiliate. will not affect any fee or other compensation payable to iVlanagcr hereunder.         Section 3. 7 Insurance.              {a)    Owner Requirements. Owner agrees to maintain all forms of insurance  required by law or by any loan requirements for the Prope11y and as otherwise deemed by Owner  to be reasonable and necessary to adequately protect Owner and Manager. including but not limited  to public liability insurance, boiler insurance, fire and extended coverage insurance. and burglary  and theft insurance. All insurance coverage shall be placed with such companies, in such amounts  and with such beneficial interest appearing therein as shall be reasonably acceptable to Owner.  Public liability insurance shall be maintained in such amounts as Owner determines as  commercially reasonable or as otherwise required by its lenders or investors, but in no case in an  amount less than $5.000.000.               Owner agrees to timely provide evidence of required insurance to Manager. and  acknowledges that if evidence of insurance coverage is not timely furnished. Manager may. but  shall not be obligated to, obtain such coverage in its capacity as Manager pursuant to this  Agreement. Manager shall be named an additional insured on all Owner obtained insurance.               (b)  Manager Requirements. Manager agrees to maintain. at its own expense.  public liability insurance in an amount not less than Two Million Dollars ($2,000.000) and all  other forms of insurance required by law and as otherwise deemed by Owner and i\•lanagcr to be  reasonable and necessary to adequately protect Owner and Manager. including but not limited to  workers compensation insurance. professional liability. employee practices. and fidelity insurance.  Manager agrees to timely provide evidence of required insurance to Owner and to name Owner as  an additional insured on appropriate policies.               Manager shall use its diligent efforts to investigate and make a written report to the  insurance company as to all accidents. claims for damage relating to the ownership. operation and  maintenance of the Property, any damage or destruction to the Property and the estimated cost of  repair thereof, and shall prepare any  and all reports for any insurance company in connection  therewith. All such reports shall be timely filed with the insurance company as required under the  terms of the insurance policy involved. With the prior written approval of Owner. Manager is  authorized to settle any and all claims against insurance companies arising out of any policies.  including the execution or proofs of loss, the adjustment of losses. signing of receipts and                                        6  

 

collection of monies (no approval by Owner shall be required for the settlement of claims of $5.000  or less). Manager is further authorized to contract for the maintenance and repair of any damage  or casualty in accordance with Section 3.6 above. Manager shall receive as an additional fee for  such services that fee designated in the loss adjustment as a general contractor"s fee. provided that  insurance proceeds that exceed the cost of repairing the damage or restoring the loss are available  to pay such fees. In such event Manager shall be responsible for all costs incurred by Manager in  adjusting such loss and contracting for repairs.               (c)  Loss or Liabilitv Claims. Owner and i\,tanager mlllually agree for the  benefit of each other to look only to the appropriate insurance coverages in effect pursuant to this  Agreement in the event any demand. claim. action. damage. loss, liability or expense occurs as a  result of ii1iury to person or damage to property. regardless whether any such demand, claim.  action. damage. loss. liability or expense is caused or contributed to. by or results from the  negligence of Owner or Manager or their respective subsidiaries. affiliates, employees. directors.  officers. agents or independent contractors and regardless whether the injury to person or damage  to property occurs in and about the Property or elsewhere as a result of the performance of this  Agreement. Except for claims that arc covered by the indemnity contained in Section 3. 7(d) below.  Owner agrees that Owncr·s insurance shall be primary without right of subrogation against  Manager with respect to all claims. actions. damage. loss or liability in or about the Property.  Nevertheless, in the event such insurance proceeds arc insuf"ficient to satisfy (or such insurance  does not cover) the demand, claim. action. loss, liability or expense. Owner agrees. at its expense.  to indemnify and hold Manager and its subsidiaries. affiliates, officers, directors. employees.  agents or independent contractors harmless to the extent of excess liability. For purposes of this  Section 3.7(c), any deductible amount under any policy of insurance shall not be deemed to be  included as part of collectible insurance proceeds.               (d)  Indemnification. Notwithstanding anything contained in this Agreement  to the contrary, Owner shall defend. indemnify. and hold harmless Manager and its reprcselllative  subsidiaries, affiliates. officers. directors. employees. agents or independent contractors from and  against all claims. demands, or legal proceedings (including expenses and reasonable allorney"s  fees incurred in connection with the defense of any such matter) (each a ··Claim'") that are brought  against Manager arising out of the operation or management of the Project, except with respect to  claims arising out of Manager"s gross negligence or willful misconduct. Manager shall defend.  indemnify. and hold harmless Owner and its representative subsidiaries, affiliates. of1icers,  directors, employees, agents or independent contractors from all Claims arising out of the gross  negligence or willful misconduct of Manager. The indemnification obligations under this Section  3.7(d) shall survive termination of this Agreement.              (e)   Acts of Tenants and Third Parties. In no event shall Manager have any  liability to Owner or others for any acts of vandalism. trespass or criminal activity of any kind by  tenants or third parties on or with respect to the Property and Owner"s insurance shall be primary  insurance without right of subrogation against Manager regarding claims arising out of or resulting  from acts of vandalism, trespass or criminal activity.         Section 3.8 Collection of Monies. Manager shall use its diligent efforts to collect all  rents and other charges due from tenants, users of garage spaces, carports, storage spaces (if any).  commercial lessees (if any) and concessionaires (if any) in respect of the Property and otherwise                                        7  

 

due Owner with respect to the Property in the ordinary course of business. provided that Manager  docs not guarantee the creditworthiness of any tenants. users. lessees or concessionaires or  collectability of accounts receivable from any of the foregoing. Owner authorizes Manager. in its  capacity as Manager pursuant to this Agreement. to request. demand. collect. receive and receipt  for all such rent and other charges and to institute legal proceedings at Ownc1.-s expense. for the  collection thereof. and for the dispossession of tenants and other persons from the Properly or lo  cancel or terminate any lease. license or concession agreement for breach or default thereunder.  and such expense may include the engaging of legal counsel for any such matter. All monies  collected by Manager shall be deposited in the separate bank account referred to in Section 5.2  herein.         Section 3.9  Manager Disbursements.               (a)    Manager's   Compensation   and  Reimbursements.     From   Gross  Collections, Manager shall be authorized to retain and pay (I) Managcr"s compensation. together  with all sales or other taxes (other than income) which Manager is obligated. presently or in the  future. to collect and pay to the State or any other governmental authority with respect to the  Property or employees at the Property. (2) the amounts reimbursable to Manager under this  Agreement, (3) the amount of all real estate taxes and other impositions levied by appropriate  authorities with respect to the Property which. if not escrowed with any mortgagee. shall be paid  upon specific written direction of Owner before interest begins to accrue thereon: and ( 4) amounts  otherwise due and payable as operating expenses of the Prope11y authorized to be incurred under  the terms of this Agreement.               (b)    Debt Service. The provisions of this Section 3.9 regarding disbursements  shall include the payment of debt service related to any mortgages of the Property, unless otherwise  instructed in writing by Owner.               (c)    Third Parties. All costs. expenses, debts and liabilities owed to third  persons that are incurred by Manager pursuant to the terms of this Agreement and in the course of  managing, leasing and operating the Property shall be the responsibility of Owner and not  Manager. Owner agrees to provide sufficient working capital funds to Manager so that all amounts  due and owing may be promptly paid by Manager. Manager is not obligated to advance any funds.  If at any time there is not sufficient cash in the account available to Manager pursuant to  Section 5.2 with which to promptly pay the bills due and owing. i'vlanagcr will request that the  necessary additional funds be deposited by Owner in an amount sufficient to meet the shortfall.  Owner will deposit the additional funds requested by Manager within five days.               (d)    Other  Provisions.  The  provisions of this Section 3.9 regarding  reimbursements to Manager shall not limit Manager"s rights under any other provision of this  Agreement.         Section 3.10 Use and  Maintenance of Premises.  ivlanager agrees that it will not  knowingly permit the use of the Prope11y for any purpose that might void any insurance policy  held by Owner or that might render any loss thereunder uncollcctible. or that would be in violation  of Governmental Requirements, or any covenant or restriction of any lease of the Property.  Manager shall use its good faith efforts to secure substantial compliance by the tenants with the                                            8  

 

 terms and conditions of their respective leases. All costs of correcting or complying with. and all   fines payable in connection with. all orders or violations affecting the Properly placed thereon by   any governmental authority or Board of Fire Underwriters or other similar body shall be at the cost   and expense of Owner.          Section 3.11 Annual Business Plan.                 (a)   Submission. No  later than 60 days prior to the end or each Fiscal Year   during the term of this Agreement. or such earlier date as reasonably requested by Owner. its   lenders or investors. Manager shall prepare and submit to Owner for Owner's approval. an Annual   Business Plan for the promotion. leasing. operations. repair and maintenance of the Property for   the succeeding Fiscal Year during which this Agreement is to remain in effect (the .. Annnal   Business Plan .. ). The Annual Business Plan shall include a detailed budget of projected income   and expenses for the Property for such Fiscal Year (the "Operating Budget..  ) and a detailed   budget of projected capital improvements for the Prope11y for such Fiscal Year (the ··Capital   Bndgef·).                 (b)   Approval. Manager shall meet with Owner to discuss the proposed Annual   Business Plan and Owner shall approve the proposed Annual Business Plan within 20 days of its   submission to Owner. or as soon thereafter as commercially practicable. To be effective. any   notice which disapproves a proposed Annual Business Plan must contain specific objections in   reasonable detail to individual line items. If Owner fails to provide an effective notice   disapproving a proposed Annual Business Plan within such 20-day period, the proposed Annual   Business Plan shall be deemed to be approved. Owner acknowledges that the Operating Budget   is intended only to be a reasonable estimate of the income and expenses of the Property for the   ensuing Fiscal Year. Manager shall not be deemed to have made any guarantee. warranty or   representation whatsoever in connection with the Operating Budget.                (c)    Revision. Manager may revise the Operating Budget from time to time. as   necessary. to reflect any unpredicted significant changes, variables or events or to include   significant additional, unanticipated items of revenue and expense. Any such revision shall be   submitted to Owner for approval. which approval shall not be unreasonably withheld, delayed or   conditioned.                (d)    Implementation.  Manager  agrees to use diligence and to employ all   reasonable efforts to ensure that the actual costs of maintaining and operating the Properly shall   not exceed the Operating Budget either in total or in any one accounting category. Any expense   causing or likely to cause a variance of greater than ten percent ( 10%) or $25.000. whichever is   greater. in any one accounting category for the current month cumulative year-to-date total shall   be promptly explained to Owner by Manager in the next operating statement submitted by   Manager to Owner.          Section 3.12 Records. Reporting. Manager shall maintain at the regular business office   of Manager or at such other address as Manager shall advise Owner in writing. separate books and  journals and orderly files. containing rental records. insurance policies. leases. correspondence.   receipts, bills and vouchers. and all other documents and papers pertaining directly to the Property   and the operation thereof. All corporate statements. receipts. invoices. checks. leases. contracts.                                             9  

 

worksheets. financial statements. books and records. and all other instruments and documents  relating to or arising from the operation or management of the Property shall be and remain the  property of Owner and the Owner shall have the right to inspect such records at any reasonable  time upon prior notice: Manager shall have the right to request and maintain copies of all such  matters. at Managcr·s cost and expense. at all reasonable times during the term of this Agreement.  and for a reasonable time thereafter not to exceed three years. All on-site records. including leases.  rent rolls. and other related documents shall remain at the respective Property for which such  records arc maintained as the prope11y of Owner.         Section 3.13 Financial Reports.                (a)   Month Iv Reports. On or before the fifteenth ( 15 111 ) day or each month  during the term of this Agreement. Manager shall deliver or cause to be delivered to Owncr·s  Representative a statement or cash flow for the Property (on a cash and not an accrual basis) for  the preceding calendar month. All notices from any mortgagee claiming any default in any  mortgage on the Property. and any other notice from any mortgagee not or a routine nature. shall  be promptly delivered by Manager to Owner's Representative.                (b)   Annual  Reports.  Within 45 days aticr the end or each Fiscal Year.  Manager shall deliver to Owner's Representative a statement of cash flow showing the results of  operations for the Fiscal Year or portion thereof during which the provisions of this Agreement  were in effect.               (c)    Employee Files. Manager shall execute and file punctually when due all  forms. reports and returns required by law relating to the employment of personnel.         Section 3.14 Compliance with Governmental Requirements.   Manager shall comply  with all laws. ordinances and regulations relating to the management. leasing and occupancy of  the Property. including any regulatory or use agreements. Owner acknowledges that Manager  docs not hold itself out to be an expert or consultant with respect to. or represent that. the Property  currently complies with applicable ordinances. regulations. rules. statutes. or laws of governmental  entities having jurisdiction over the Properties or the requirements of the Board of Fire  Underwriters or other similar bodies (collectively ...Governmental  Requirements .. ). Manager  shall take such action as may be reasonably necessary to comply with any Governmental  Requirements applicable to Manager. including the collection and payment of all sales and other  taxes ( other than income taxes) which may be assessed or charged by the State or any governmental  entities in connection with Manager's compensation. If Manager discovers that the Property does  not comply with any Governmental Requirements. Manager shall take such action as may be  reasonably necessary to bring the Properly into compliance  with such  Governmental  Requirements. subject to the limitation contained in Section 3.5 of this Agreement regarding the  making of alterations and repairs. Manager, however. shall not take any such action as long as  Owner is contesting or has affirmed its intention to contest and promptly institute proceedings  contesting any such order or requirement. If: however. failure to comply promptly with any such  order or requirement would or might expose Manager to civil or criminal liability. Manager shall  have the right, but not the obligation. to cause the same to be complied with and Owner agrees to  indemnify and hold Manager harmless for taking such actions and to promptly reimburse l'vlanager  for expenses incurred thereby. Manager shall promptly. and in no event later than T2. hours from                                           10  

 

the time ofreceipt, notify Owner"s Representative in writing of all such orders ornotices. Manager  shall not be liable for any effort or judgment or for any mistake of fact or of law. or for anything  that it may do or refrain from doing. except in cases of willful misconduct or gross negligence of  Manager.                                       ARTICLE -I                        MANAGER'S COMPENSATION. TERM         Section 4.1  Fees Paid to Manager. Commencing on the date hereat: Owner shall pay  to Manager a fee (the "Management Fee"). payable monthly in arrears, in an amount equal to  Three Percent (3.0%) of Gross Collections for such month. The Management Fee shall not be  subject to off-sets and charges unless agreed upon by the parties. Pass-Through Amounts shall be  collected monthly by ivlanager. as applicable.         Section 4.2  Term.  This Agreement shall commence on the Effective Date. and shall  thereafter continue for a period of one (I) year from the Effective Date. unless otherwise  terminated as provided herein. Thcreafier. if neither party gives written notice to the other at least  60 days prior to the expiration date hereof that this Agreement is to terminate. then this Agreement  shall be automatically renewed on a month-to-month basis.         Section 4.3  Termination Rights. Notwithstanding anything that may be contained  herein to the contrary, Owner may terminate this Agreement at any time by giving Manager thirty  (30) days written notice thereof upon a determination of gross negligence, willful misconduct or  bad acts of Manager or any of its employees. If Owner or Manager shall materially breach its  obligations hereunder. and such breach remains uncured for a period of 30 days after written  notification of' such breach. the party not in breach hereunder may terminate this Agreement by  giving written notice to the other. Any notice given pursuant to this Article 4. shall be sent by  certified mail.         Section 4.4  Duties on Termination.  Upon  any termination of this Agreement as  contemplated in Section 4.4, Manager shall be entitled to receive all compensation and  reimbursements. if any. due to Manager through the date of termination. Within 30 days after any  termination, Manager shall deliver to Owner's Representative. the report required by  Section 3. I 3(a) for any period not covered by such a rcp011 at time of tennination. and within 30  days atier any such termination. Manager shall deliver to Owner's Representative. as required by  Section 3. l 3(b). the statement of cash flow for the Fiscal Year or portion thereof ending on the  date of termination. In addition. upon termination of this Agreement for any reason. i'vlanager will  submit to Owner within 30 days after termination any reports required hereunder. all of the cash  and bank accounts of the Property. including. without limitation. the Security Deposit Account.  investments and records. Manager will, within 30 days after termination. tum over to Owner all  copies of all books and records kept for the Property. If Manager desires to retain records of the  Property. Manager must reproduce them at its own expense.                                            11  

 

                                   ARTICLE 5       PROCEDURES FOR HANDLING RECEIPTS AND OPERATING CAPITAL         Section 5.1  Securitv Deposits. Manager shall collect. deposit. hold. disburse and pay  security deposits as required by applicable State law and all other applicable laws. and in  accordance with the terms of each tenant's lease. The amount of each security deposit will be  specified in the tenant's lease. Security deposits shall be deposited into a separate non-intcrest­ bearing account unless otherwise required by law (the ·'Security Deposit Accounf") at a  Depository selected by Manager and approved by Owner. For so long as any such security  deposit(s) are refundable. unless Owner informs rvlanager in writing that it intends to hold the  Security Deposit Account. the Security Deposit Account may be established in the name of the  Manager acting in its capacity as manager pursuant to this Agreement and held separate from  all  other Manager's funds and accounts. If such account is held by Manager. only representatives of  Manager acting in their capacity as representatives of the Manager pursuant to this Agreement will  be signatories to this account. Upon such time that any security dcposit(s) shall become non­ refundable and property of the Owner. such security deposit(s) shall immediately be transferred to  an account in the name of the Owner. To the extent possible, the Security Deposit Account shall  be fully insured by the Federal Deposit Insurance Corporation (FDIC). Owner agrees to indemnify  and hold harmless Manager. and Manager's representatives. officers. directors and employees for  any loss or liability with respect to any use by Owner of the tenant security deposits that is  inconsistent with the terms of tenant leases and applicable laws.         Section 5.2  Separation of Owner's Monies. Manager shall deliver all collected rents.  charges and other amounts received in connection with the management and operation of the  Property (except for tenants· security deposits. which will be handled as specified in this  Agreement) to a Depository selected by Manager and approved by Owner.         Section 5.3  Depositorv Accounts. Except to the extent that Manager has not complied  with its obligations under Sections 2.4 and 5.2. Owner and Manager agree that Manager shall have  no liability for loss of funds of Owner contained in the bank accounts for the Property maintained  by Owner or Manager pursuant to this Agreement due to insolvency of the bank or financial  institution in which its accounts are kept. whether or not the amounts in such accounts exceed the  maximum  amount of federal or other deposit insurance applicable with respect to the financial  institution in question.         Section 5.4  Working Capital. In addition to the funds derived from the operation of  the Property, Owner shall furnish and maintain in the operating accounts of the Property such other  funds as may be necessary to discharge financial commitments required to efficiently operate the  Property and to meet all payrolls and satisfy. before delinquency. and to discharge all accounts  payable. Manager shall have no responsibility or obligation with respect to the furnishing of any  such funds. Nevertheless. Manager shall. in its capacity as Manager pursuant to this Agreement.  have the right, but not the obligation. to advance funds or contribute property to satisfy obligations  of Owner in connection with this Agreement and the Property. Manager shall keep appropriate  records to document all reimbursable expenses paid by Manager. which records shall be made  available for inspection by Owner or its agents on request. Owner agrees to reimburse Manager  upon demand for money paid or property contributed in connection with the Propc11y and this  Agreement.                                           12  

 

      Section 5.5 Authorized Signatures. Any persons from time to time designated by  Manager shall be authorized signatories on all bank accounts established by Manager pursuant to  this Agreement and shall have authority to make disbursements pursuant to the terms of' this  Agreement from such accounts. Funds mav be withdrawn from all bank accounts established by  M7inager. in accordance with this Article 5:only upon the signature ofan individual who has been  granted that authority by Manager and funds may not be withdrawn from such accounts by Owner  unless Manager is in default hereunder.                                   ARTICLE 6                               MISCELLANEOUS         Section 6.1 Assignment. Upon 30 days written notification. Owner may assign its  rights and obligations to any successor in title to the Properly and upon such assignment shall be  relieved of all liability accruing after the effective date of such assignment. This Agreement may  not be assigned or delegated by Manager without the prior written consent of Owner. which Owner  may withhold in its sole discretion. Any unauthorized assignment shall be null and void ab initio.  and shall not in any event release Manager from any liabilities hereunder.         Section 6.2 Notices. All notices required or permitted by this Agreement shall be in  writing and shall be sent by registered or certified mail. addressed in the case of Owner to STAR  Oasis. LLC. 18100 Von Karman Avenue. Suite 500. Irvine. CA 92612. Attention: Kevin Keating:  and in the case of' Manager to Steadfast Management Company. Inc .. 18100 Von Karman Avenue.  Suite 500. Irvine. CA 92612. Attention: Christopher Hilbert. or to such other address as shall.  from time to time. have been designated by written notice by either party given to the other party  as herein provided.         Section 6.3 Entire Agreement. This Agreement shall constitute the entire agreement  between the parties hereto and no modification thereof shall be effective unless in writing executed  by the parties hereto.         Section 6.4 No Partnership. Nothing contained in this Agreement shall constitute or  be construed to be or create a partnership or joint venture between Owner. its successors or assigns.  on the one part. and Manager. its successors and assigns. on the other part.         Section 6.5 No Third Partv Beneliciarv. Neither this Agreement nor any part hereof'  nor any service relationship shall inure to the benefit of any third party. to any trustee in  bankruptcy, to any assignee for the benefit of'creditors. to any receiver by reason of insolvency. to  any other fiduciary or officer representing a bankrupt or insolvent estate of' either party. or to the  creditors or claimants of such an estate. Without limiting the generality of the foregoing sentence.  it is specifically understood and agreed that such insolvency or bankruptcy of' either party hereto  shall. at the option of the other party. void all rights of such insolvent or bankrupt party hereunder  (or so many of such rights as the other party shall elect to void).         Section 6.6 Severabilitv. If any one or more of the provisions of' this Agreement. or  the applicability of any such provision lo a specific situation. shall be held invalid or  unenforceable. such provision should be modified to the minimum extent necessary to make it or                                        13  

 

its application valid and enforceable. and the validity and enforceability of all other provisions of  this Agreement and all other applications or such provisions shall not be affected thereby.         Section 6.7 Captions. Pinnt! Terms. Unless the context clearly requires otherwise. the  singular number herein shall include the plural. the plural number shall include the singular and  any gender shall include all genders. Titles and captions herein shall not affect the construction of  this Agreement.         Section 6.8 Attornevs' Fees. Should either party employ an attorney to enforce any of  the provisions of this Agreement. or to recover damages for breach of this Agreement. the non­ prevailing party in any action agrees to pay to the prevailing party all reasonable costs. damages  and expenses. including reasonable attorneys· fees. expended or incurred by the prevailing party  in connection therewith.         Section 6.9 Signs. Manager shall have the right to place signs on the Property in  accordance with applicable Governmental Requirements stating that Manager is the manager and  leasing agent for the Property.         Section 6.10 Survival of Indemnities. The indemnification obligations of the parties to  this Agreement shall survive the termination or this Agreement to the extent of any claim or cause  of action based on an event occurring prior to the date of termination.         Section 6.11 Governing Law. This Agreement shall be construed under and in  accordance with the laws of the State and is fully performable with respect to the Property in the  county in which the Property is located.         Section 6.12 Competitive Properties. ivlanager may, individually or with others,  engage or possess an interest in any other project or venture of every nature and description.  including but not limited to. the ownership. financing. leasing. operation. management. brokerage  and sale of real estate projects including apartment projects other than the Property. whether or not  such other venture or projects are competitive with the Property and Owner shall not have any  claim as to such project or venture or to the income or profits derived therefrom.         Section 6.13 Set Off. Without prejudice to Manager's right to terminate this Agreement  in accordance with the terms of this Agreement. Manager may at any time and without notice to  Owner. set off or transfer any sums held by Manager for or on behalf of Owner in the accounts  (other  than the Security Deposit Account) maintained pursuant to this Agreement in or towards  satisfaction of any of Owner's liabilities to Manager in respect of any sums due to Manager under  this Agreement.         Section 6.14 Notice of Default. Manager shall not be deemed in default under this  Agreement, and Owner's right to terminate Manager as a result of such default shall not accrue.  until Owner has delivered written notice of default to Manager and Manager has failed to cure  same within 30 days from the date of receipt of such notice.         Section 6.15 Counterparts. This Agreement may be executed in two or more  counterparts. each of which shall be deemed to be an original.                                        14  

 

            This Property Management Agreement is hereby executed by duly authorized  representatives of the parties hereto as of the Effective Date,     O\VNER:                     STAR OASIS, LLC,                               a Delaware limited liability company                                By:    MAl~AGER:                    STEADFAST MANAGEMENT COMPANY, INC.,                               a California corporation                                B·l/~~--11liam"c.  Stoll, 'vice President                                        15  

 

                                    EXHIBIT A                       ESTIMATED PASS-THROUGH AMOUNTS   Benefits Administration                                  3.0% of total employee costs  IT Infrastrncture. Licenses and Support                  At cost and expense  Marketingffraining/Continuing Education                  $20.00 p.u.p.y.                                            16  

 

                                 EXHIBIT B                                 THE PROPERTY   The Oasis Apartments is located at 1495 Farnham Point, Colorado Springs, Colorado. in the  County of El Paso. and described as follows:   The Property is comprised of Sixteen 2 and 3-story buildings with 252 units. Site amenities  include clubhouse. 24 hour fitness center. swimming pool. hot tub. and a business center. It is  situated on 15.13 acres and it was built in 1997.                                         17ex1025oasisguaranty

                                                                         EXHIBIT 10.25                                                 Freddie Mac Loan Number: 504021303                                                           Property Name: The Oasis                                    GUARANTY                                   MULTISTATE                                  (Revised 4-19-2018)   THIS  GUARANTY    ("Guaranty") is entered into to be effective as of July 31, 2018, by  STEADFAST     APARTMENT     REIT,   INC., a  Maryland  corporation ("Guarantor",  collectively if more than one), for the benefit of PNC BANK, NATIONAL ASSOCIATION, a  national banking association ("Lender").                                     RECITALS   A.    Pursuant to the terms of a Multifamily Loan and Security Agreement dated the same date        as this Guaranty (as amended, modified or supplemented from time to time, the "Loan        Agreement"), STAR Oasis, LLC, a Delaware limited liability company ("Borrower")        has requested that Lender make a loan to Borrower in the amount of $39,740,000.00        ("Loan"). The Loan will be evidenced by one or more Multifamily Note(s) from        Borrower to Lender dated effective as of the effective date of this Guaranty (as amended,        modified or supplemented from time to time, and collectively if applicable, the "Note").        The Note will be secured by a Multifamily Mortgage, Deed of Trust, or Deed to Secure        Debt dated effective as of the effective date of the Note (as amended, modified or        supplemented from time to time, the "Security Instrument"), encumbering the        Mortgaged Property described in the Loan Agreement.   B.    As a condition to making the Loan to B01Tower, Lender requires that Guarantor execute        this Guaranty.  C.    Guarantor has a direct or indirect ownership or other financial interest in Bon-ower and/or        will otherwise derive a material benefit from the making of the Loan.                                   AGREEMENT  NOW,  THEREFORE,   in order to induce Lender to make the Loan to Borrower, and in  consideration thereof and other good and valuable consideration, the receipt and sufficiency of  which are hereby acknowledged, Guarantor agrees as follows:   1.    Defined Terms.  The  terms "Indebtedness", "Loan Documents", and "Property        Jmisdiction", and other capitalized terms used but not defined in this Guaranty, will have        the meanings assigned to them in the Loan Agreement.   2.    Scope of Guaranty.         (a)   Guarantor hereby absolutely, unconditionally and irrevocably guarantees to              Lender each of the following:              (i)   Guarantor guarantees the full and prompt payment when due, whether at                    the Maturity Date or earlier, by reason of acceleration or otherwise, and at                    all times thereafter, of each of the following:    Guaranty - Multistate  

 

                  (A)   Guarantor guarantees a pmiion of the Indebtedness (including                          interest at the Note rate) equal to 0.00% of the original principal                          balance of the Note ("Base Guaranty").                     (B)   In addition to the Base Guaranty, Guarantor guarantees all other                          amounts  for which  Borrower  is personally liable under                          Sections 9(c), 9(d) and 9(f) of the Note (provided, however, that                          Guarantor will have no liability for failure of BmTower or SPE                          Equity Owner to comply with (I) Section 6.13(a)(xviii) of the Loan                          Agreement, and (II) the requirement in Section 6.13(a)(x)(B) of the                          Loan Agreement as to payment of trade payables within 60 days of                          the date incurred).                     (C)   Guarantor guarantees all costs and expenses, including reasonable                          Attorneys' Fees and Costs incmTed by Lender in enforcing its                          rights under this Guaranty.              (ii)  Guarantor guarantees the full and prompt payment and performance of,                    and compliance with, all of BmTower's obligations under Sections 6.12,                    10.02(b) and 10.02(d) of the Loan Agreement when due and the accuracy                    of Borrower's representations and warranties under Section 5.05 of the                    Loan Agreement.               (iii) Guarantor guarantees the full and prompt payment and peiformance of,                    and compliance with, B01Tower's obligations under Section 6.09(e)(v) of                    the Loan Agreement to the extent Property Improvement Alterations have                    commenced and remain uncompleted.              (iv) through (vi) Reserved.         (b)   If the Base Guaranty stated in Section 2(a)(i)(A) is 100% of the original principal              balance of the Note, then the following will be applicable:              (i)   The Base  Guaranty will mean and include, and Guarantor hereby                    absolutely, unconditionally and irrevocably guarantees to Lender, the full                    and complete prompt payment of the entire Indebtedness, the pe1formance                    of and/or compliance with all of Borrower's obligations under the Loan                    Documents when due, and the accuracy of B01Tower' s representations and                    wmTanties contained in the Loan Documents.              (ii)  For so long as the Base Guaranty remains in effect (there being no limit to                    the duration of the Base Guaranty unless otherwise expressly provided in                    this Guaranty), the obligations guaranteed pursuant to Sections 2(a)(i)(B)                    and 2(a)(i)(C) will be part of, and not in addition to or in limitation of, the                    Base Guaranty.         (c)   If the Base Guaranty stated in Section 2(a)(i)(A) is less than 100% of the original              principal balance of the Note, then Section 2(b) will be completely inapplicable.         (d)   If Guarantor is not liable for the entire Indebtedness, then all payments made by              Borrower with respect to the Indebtedness and all amounts received by Lender              from the enforcement of its lights under the Loan Agreement and the other Loan              Documents (except this Guaranty) will be applied first to the portion of the              Indebtedness for which neither Borrower nor Guarantor has personal liability.    Guaranty - Multistate                                                    Page2  

 

3.    Additional Guaranty Relating to Bankruptcy.         (a)   Notwithstanding any limitation on liability provided for elsewhere in this              Guaranty, Guarantor hereby absolutely, unconditionally and iITevocably              guarantees to Lender the full and prompt payment when due, whether at the              Maturity Date or earlier, by reason of acceleration or otherwise, and at all times              thereafter, the entire Indebtedness, in the event that:               (i)   B01Tower or any SPE Equity Owner voluntarily files for bankruptcy                    protection under the Bankruptcy Code.              (ii)  Borrower or any SPE Equity Owner voluntarily becomes subject to any                    reorganization, receivership, insolvency proceeding, or other similar                    proceeding pursuant to any other federal or state law affecting debtor and                    creditor rights.               (iii) The Mortgaged Property or any part of the Mortgaged Property becomes                    an asset in a voluntary bankruptcy or becomes subject to any voluntary                    reorganization, receivership, insolvency proceeding, or other similar                    voluntary proceeding pursuant to any other federal or state law affecting                    debtor and creditor rights.              (iv)  An order of relief is entered against B01Tower or any SPE Equity Owner                    pursuant to the Bankruptcy Code or other federal or state law affecting                    debtor and creditor rights in any involuntary bankruptcy proceeding                    initiated or joined in by a Related Party.              (v)   An involuntary bankruptcy or other involuntary insolvency proceeding is                    conunenced against B01Tower or any SPE Equity Owner (by a party other                    than Lender) but only if Borrower or such SPE Equity Owner has failed to                    use commercially reasonable efforts to dismiss such proceeding or has                    consented to such proceeding. "Commercially reasonable efforts" will not                    require any direct or indirect interest holders in B01Tower or any SPE                    Equity Owner to contribute or cause the contribution of additional capital                    to B01Tower or any SPE Equity Owner.        (b)   For purposes of Section 3(a) the term "Related Party" will include all of the              following:              (i)   B01Tower, any Guarantor or any SPE Equity Owner.              (ii)  Any Person that holds, directly or indirectly, any ownership interest                    (including any shareholder, member or partner) in BoITower, any                    Guarantor or any SPE Equity Owner or any Person that has a right to                    manage B01Tower, any Guarantor or any SPE Equity Owner.              (iii) Any Person in which B01Tower, any Guarantor or any SPE Equity Owner                    has any ownership interest (direct or indirect) or right to manage.              (iv)  Any Person in which any partner, shareholder or member of B01Tower,                    any Guarantor or any SPE Equity Owner has an ownership interest or right                    to manage.              (v)   Any Person in which any Person holding an interest in B01Tower, any                    Guarantor or any SPE Equity Owner also has any ownership interest.   Guaranty - Multistate                                                    Page 3  

 

            (vi)  Any creditor (as defined in the Bankruptcy Code) of Borrower that is                    related by blood, marriage or adoption to Borrower, any Guarantor or any                    SPE Equity Owner.              (vii) Any creditor (as defined in the Bankruptcy Code) of B01Tower that is                    related to any partner, shareholder or member of, or any other Person                    holding an interest in, Borrower, any Guarantor or any SPE Equity Owner.        (c)   If Borrower, any Guarantor, any SPE Equity Owner or any Related Party has              solicited creditors to initiate or participate in any proceeding referred to in              Section 3(a), regardless of whether any of the creditors solicited actually initiates              or participates in the proceeding, then such proceeding will be considered as              having been initiated by a Related Party.  4.    Guarantor's Obligations Survive Foreclosure. The obligations of Guarantor under this        Guaranty will survive any foreclosure proceeding, any foreclosure sale, any delivery of        any deed in lieu of foreclosure, and any release of record of the Security Instrument, and,        in addition, the obligations of Guarantor relating to Borrower's representations and        wmrnnties under Section 5.05 of the Loan Agreement, and Borrower's obligations under        Sections 6.12 and 10.02(b) of the Loan Agreement will survive any repayment or        discharge of the Indebtedness. Notwithstanding the foregoing, if Lender has never been a        mortgagee-in-possession of or held title to the M01tgaged Property, Guarantor will have        no obligation under this Guaranty relating to Borrower's representations and wmrnnties        under Section 5.05 of the Loan Agreement or Borrower's obligations relating to        environmental matters under Sections 6.12 and 10.02(b) of the Loan Agreement after the        date of the release of record of the lien of the Security  Instrument as a result of the        payment in full of the Indebtedness on the Maturity Date or by voluntary prepayment in        full.  5.    Guaranty of Payment and Performance. Guarantor's obligations under this Guaranty        constitute an unconditional guaranty of payment and performance and not merely a        guaranty of collection.  6.    No  Demand  by Lender  Necessary; Waivers by Guarantor. The obligations of        Guarantor under this Guaranty must be perfonned without demand by Lender and will be        unconditional regardless of the genuineness, validity, regularity or enforceability of the        Note, the Loan Agreement, or any other Loan Document, and without regard to any other        circumstance which might otherwise constitute a legal or equitable discharge of a surety,        a guarantor, a borrower or a mortgagor. Guarantor hereby waives, to the fullest extent        pennitted by applicable law, all of the following:        (a)   The benefit of all principles or provisions of law, statutory or otherwise, which              are or might be in conflict with the terms of this Guaranty and agrees that              Guarantor's obligations will not be affected by any circumstances, whether or not              refeffed to in this Guaranty, which might otherwise constitute a legal or equitable              discharge of a surety, a guarantor, a b01Tower or a mortgagor.        (b)   The benefits of any right of discharge under any  and all statutes or other laws              relating to a guarantor, a surety, a b01Tower or a mortgagor, and any other rights              of a surety, a guarantor, a b01Tower or a m01tgagor under such statutes or laws.        (c)   Diligence in collecting the Indebtedness, presentment, demand for payment,              protest, all notices with respect to the Note and this Guaranty which may be              required by statute, rule of law or otherwise to preserve Lender's rights against    Guaranty - Multistate                                                    Page4  

 

            Guarantor under this Guaranty, including notice of acceptance, notice of any              amendment of the Loan Documents, notice of the occurrence of any default or              Event of Default, notice of intent to accelerate, notice of acceleration, notice of              dishonor, notice of foreclosure, notice of protest, and notice of the incunfog by              B01Tower of any obligation or indebtedness.         (d)   All rights to cause a marshalling of the BmTower's assets or to require Lender to              do any of the following:               (i)   Proceed against B01Tower or any other guarantor of Borrower's payment                    or performance under the Loan Documents (an "Other Guarantor").              (ii)  Proceed against any general partner of Borrower or any Other Guarantor if                    Borrower or any Other Guarantor is a partnership.              (iii) Proceed against or exhaust any collateral held by Lender to secure the                    repayment of the Indebtedness.              (iv)  Pursue any other remedy it may now or hereafter have against B01Tower,                    or, if Borrower is a partnership, any general partner of B01Tower.        (e)   Any right to object to the timing, manner or conduct of Lender's enforcement of              its rights under any of the Loan Documents.         (f)   Any right to revoke this Guaranty as to any future advances by Lender under the              terms of the Loan Agreement to protect Lender's interest in the Mortgaged              Property.  7.    Modification of Loan Documents. At any time or from time to time and any number of        times, without notice to Guarantor and without affecting the liability of Guarantor, all of        the following will apply:        (a)   Lender may extend the time for payment of the principal of or interest on the              Indebtedness or renew the Indebtedness in whole or in part.        (b)   Lender may extend the time for B01Tower' s pe1formance  of or compliance with              any covenant or agreement contained in the Note, the Loan Agreement or any              other Loan Document, whether presently existing or entered into after the date of              this Guaranty, or waive such pe1formance or compliance.        (c)   Lender may accelerate the Maturity Date of the Indebtedness as provided in the              Note, the Loan Agreement, or any other Loan Document.         (d)   Lender and B01Tower may modify or amend the Note, the Loan Agreement, or              any other Loan Document in any respect, including an increase in the principal              amount.        (e)   Lender may modify, exchange, surrender or otherwise deal with any security for              the Indebtedness or accept additional security that is pledged or mortgaged for the              Indebtedness.  8.    Joint and Several Liability. The obligations of Guarantor (and each party named as a        Guarantor in this Guaranty) and any Other Guarantor will be joint and several. Lender, in        its sole and absolute discretion, may take any of the following actions:    Guaranty - Multistate                                                    Pages  

 

      (a)   Lender may bring suit against Guarantor, or any one or more of the parties named              as a Guarantor in this Guaranty, and any Other Guarantor, jointly and severally, or              against any one or more of them.         (b)   Lender may compromise or settle with Guarantor, any one or more of the parties              named as a Guarantor in this Guaranty, or any Other Guarantor, for such              consideration as Lender may deem proper.         (c)   Lender may release one or more of the parties named as a Guarantor in this              Guaranty, or any Other Guarantor, from liability.        (d)   Lender may otherwise deal with Guarantor and any Other Guarantor, or any one              or more of them, in any manner.        No action of Lender described in this Section 8 will affect or impair the rights of Lender        to collect from any one or more of the parties named as a Guarantor under this Guaranty        any amount guaranteed by Guarantor under this Guaranty.   9.    Limited Release of Guarantor Upon Transfer of Mortgaged Property. If Guarantor        requests a release of its liability under this Guaranty in connection with a Transfer which        Lender has approved pursuant to Section 7.05(a) of the Loan Agreement, and B01Tower        has provided a replacement Guarantor acceptable to Lender, then one of the following        will apply:         (a)   If BoITower delivers to Lender a Clean Site Assessment, then Lender will release              Guarantor from all of Guarantor's obligations except Guarantor's obligation to              guaranty B01Tower's liability under Section 6.12 (Environmental Hazards) or              Section 10.02(b) (Environmental Indemnification) of the Loan Agreement with              respect to any loss, liability, damage, claim, cost or expense which directly or              indirectly arises from or relates to any Prohibited Activities or Conditions existing              prior to the date of the Transfer.         (b)   If Borrower does not deliver a Clean Site Assessment as described in              Section 7.05(b)(i) of the Loan Agreement, then Lender will release Guarantor              from all of Guarantor's obligations except for Guarantor's obligation to guaranty              B01Tower's liability under Section 6.12  (Environmental Hazards) or              Section 10.02(b) (Environmental Indemnification) of the Loan Agreement.  10.   Subordination of Borrower's Indebtedness to Guarantor. Any indebtedness of        B01Tower held by Guarantor now or in the future is and will be subordinated to the        Indebtedness and Guarantor will collect, enforce and receive any such indebtedness of        B01Tower as trustee for Lender, but without reducing or affecting in any manner the        liability of Guarantor under the other provisions of this Guaranty.  11.   Waiver of Subrogation. Guarantor will have no right of, and hereby waives any claim        for, subrogation or reimbursement against Borrower or any general partner of Borrower        by reason of any payment by Guarantor under this Guaranty, whether such right or claim        arises at law or in equity or under any contract or statute, until the Indebtedness has been        paid in full and there has expired the maximum possible period thereafter during which        any payment made by BoITower to Lender with respect to the Indebtedness could be        deemed a preference under the United States Bankruptcy Code.   12.   Preference. If any payment by BoITower is held to constitute a preference under any        applicable bankruptcy, insolvency, or similar laws, or if for any other reason Lender is        required to refund any sums to Borrower, such refund will not constitute a release of any   Guaranty - Multistate                                                    Page6  

 

      liability of Guarantor under this Guaranty. It is the intention of Lender and Guarantor that        Guarantor's obligations under this Guaranty will not be discharged except by Guarantor's        pe1formance of such obligations and then only to the extent of such performance.  13.   Financial Information and Litigation. Guarantor will deliver each of the following to        Lender within 10 Business Days following a Notice from Lender requesting such        information:         (a)   Guarantor's balance sheet and profit and loss statement as of the end of (A) the              quarter that ended at least 30 days prior to the due date of the requested items,              and/or (B) the fiscal year that ended at least 90 days prior to the due date of the              requested items.        (b)   Other Guarantor financial statements as Lender may reasonably require.        (c)   Written updates on the status of all litigation proceedings that Guarantor disclosed              or should have disclosed to Lender as of the date of this Guaranty.        (d)   If an Event of Default has occmTed and is continuing, copies of Guarantor's most              recent filed state and federal tax returns, including any cu1Tent tax return              extensions.  14.   Assignment. Lender may assign its rights under this Guaranty in whole or in part and        upon any such assignment, all the terms and provisions of this Guaranty will inure to the        benefit of such assignee to the extent so assigned. The terms used to designate any of the        parties in this Guaranty will be deemed to include the heirs, legal representatives,        successors and assigns of such parties, and the term "Lender" will also include any lawful        owner, holder or pledgee of the Note.  15.   Complete and  Final Agreement. This Guaranty and the other Loan Documents        represent the final agreement between the parties and may not be contradicted by        evidence of prior, contemporaneous or subsequent oral agreements. There are no        unwritten oral agreements between the parties. All prior or contemporaneous agreements,        understandings, representations, and statements, oral or written, are merged into this        Guaranty and the other Loan Documents. Guarantor acknowledges that Guarantor has        received a copy of the Note and all other Loan Documents. Neither this Guaranty nor any        of its provisions may be waived, modified, amended, discharged, or tenninated except by        a writing signed by the party against which the enforcement of the waiver, modification,        amendment, discharge, or termination is sought, and then only to the extent set forth in        that writing.  16.   Governing Law. This Guaranty will be governed by and enforced in accordance with the        laws of the Property Jurisdiction, without giving effect to the choice of law principles of        the Property Jurisdiction that would require the application of the laws of a jurisdiction        other than the Property Jurisdiction.  17.   Jurisdiction; Venue. Guarantor agrees that any controversy arising under or in relation        to this Guaranty may be litigated in the Property Jurisdiction, and that the state and        federal courts and authorities with jurisdiction in the Property Jurisdiction will have        jurisdiction over all controversies which may aiise under or in relation to this Guaranty.        Guarantor iITevocably consents to service, jurisdiction and venue of such courts for any        such litigation and waives any other venue to which it 1night be entitled by virtue of        domicile, habitual residence or otherwise. However, nothing in this Guaranty is intended        to limit Lender's right to bring any suit, action or proceeding relating to matters arising    Guaranty - Multistate                                                    Page7  

 

      under this Guaranty against Guarantor or any of Guarantor's assets in any court of any        other jmisdiction.   18.   Guarantor's Interest in Borrower. Guarantor represents to Lender that Guarantor has a        direct or indirect ownership or other financial interest in Bon-ower and/or will otherwise        derive a material financial benefit from the making of the Loan.                                                      (  19.   Reserved.   20.   Reserved.  21.   Reserved.  22.   Term of Existence.         (a)   This Section 22 will only apply to any Guarantor(s) that is an entity whose term              of existence expires prior to the Maturity Date.        (b)   At least 6 months prior to the expiration of its term of existence ("Term"), each              entity Guarantor must take one of the following actions ("Guarantor Expiration              Alternatives"):              (i)   Extend its Term to a date that is at least 6 months after the Maturity Date                    ("Extension") and provide Lender with Notice of the Extension.              (ii)  Cause one or more natural persons or entities who individually or                    collectively, as applicable, is/are acceptable to Lender, to execute and                    deliver to Lender a guaranty in the same form as this Guaranty, without                    any cost or expense to Lender.              (iii) Deliver to Lender a letter of credit ("Term Extension Letter of Credit")                    or other collateral acceptable to Lender as collateral security for the Loan.                    The Term Extension Letter of Credit must meet all of the following                    conditions:                    (A)   Satisfy the requirements for Letters of Credit in Section 11.15 of                          the Loan Agreement.                    (B)   Be in an amount equal to I 0% of the outstanding principal balance                          of the Note.                    (C)   Include an automatic renewal provision or have a term that extends                          six months beyond the Matmity Date of the Loan.        (c)   Guarantor must ensure the Term Extension Letter of Credit remains in force until              the Loan is paid in full. If Lender receives any Notice from the Tenn Extension              Letter of Credit  Issuer that Issuer will not renew the Term Extension Letter of              Credit, then Lender may immediately draw upon the Term Extension Letter of              Credit in full and hold the proceeds in an escrow account.        (d)   Lender will hold the Term Extension Letter of Credit or, if Lender has previously              drawn on the Term Extension Letter of Credit pursuant to Section 22(c), the              proceeds of the Term Extension Letter of Credit, until the first to occur of the              following:    Guaranty - Multistate                                                    Page 8  

 

            (i)   Lender has a claim against Guarantor under the terms of this Guaranty, in                    which case Lender may take either of the following actions:                     (A)   Draw on the Term Extension Letter of Credit in an amount equal to                          the claim and apply the proceeds to fully or partially satisfy the                          claim.                     (B)   If Lender has previously drawn on the Term Extension Letter of                          Credit pursuant to Section 22(c), then Lender may apply the                          proceeds of such draw to fully or partially satisfy the claim.                    If the amount of the claim exceeds the amount of the Tenn Extension                    Letter of Credit, Guarantor will remain liable to Lender for the remainder                    of the claim.               (ii)  The Loan is paid in full.        (e)   The requirement to provide a Term Extension Letter of Credit is in addition to,              and not in substitution for, any requirement to provide a Letter of Credit pursuant              to the Minimum Net Worth/Liquidity Rider to Guaranty (if applicable) or any              other Letter of Credit required under the tern1s of the Loan Documents.         (f)   If Guarantor fails to exercise one of the Guarantor Expiration Alternatives at least              6 months p1ior to the expiration of the Term ("Term Expiration Date"),              Guarantor must deliver to Lender monthly financial statements (each a              "Guarantor Financial Statement") in the form required under Section 6.07(f) of              the Loan Agreement.              (i)   Guarantor must begin delivering the Guarantor Financial Statement on the                    first day of the month which is 6 months prior to the Term Expiration Date                    and continue delivering the Guarantor Financial Statement on the first day                    of every month thereafter until Guarantor exercises one of the Guarantor                    Expiration Alternatives. The Guarantor Financial Statement must                    demonstrate a net worth and liquidity that are acceptable to Lender. If a                    Guarantor Financial Statement indicates that Guarantor's net worth or                    liquidity is unacceptable to Lender, upon Notice from Lender, Guarantor                    must immediately exercise one of the Guarantor Expiration Alternatives.               (ii)  Guarantor must exercise one of the Guarantor Expiration Alternatives                    prior to the Term Expiration Date.              (iii) Guarantor's requirements to deliver the Guarantor Financial Statements                    are in addition to any other requirements set forth in the Loan Documents                   · requiring Guarantor to deliver any financial information (including the                    Guarantor's requirements regarding financial covenants set forth in                    Section 20).  23.   Reserved.  24.   Reserved.  25.   State-Specific Provisions. State-specific provisions, if any, are included on Schedule I        to this Guaranty.    Guaranty - Multistate                                                    Page9  

 

26.   Community  Property. If Guarantor (or any Guarantor, if more than one) is a maITied        person, and the state of residence of Guarantor or his or her spouse ("Guarantor        Spouse") is a community property jurisdiction, then each of the following apply:         (a)   Guarantor (or each such married Guarantor, if more than one) agrees that Lender              may satisfy Guarantor's obligations under this Guaranty to the extent of all of              Guarantor's separate property and against the marital community property of              Guarantor and Guarantor Spouse.         (b)   If Guarantor Spouse is not also a Guarantor of the Loan, Guarantor certifies that              none of the assets shown on his or her financial statements submitted to Lender              for purposes of underwriting the Loan were either (i) Guarantor Spouse's              individual property, or (ii) cmmnunity property under the sole management,              control, and disposition of Guarantor Spouse.         (c)   If Guarantor or Guarantor Spouse resides in Alaska, Arizona, Idaho, Louisiana,              Nevada, New  Mexico,  Washington or Wisconsin, Guarantor has caused              Guarantor Spouse to acknowledge this Guaranty as required on the signature page              of this Guaranty.  27.   WAIVER OF TRIAL BY JURY.         (a)   GUARANTOR     AND  LENDER EACH     COVENANTS    AND  AGREES   NOT              TO  ELECT   A  TRIAL  BY  JURY   WITH   RESPECT    TO  ANY  ISSUE              ARISING   OUT   OF   THIS  GUARANTY     OR   THE   RELATIONSIDP              BETWEEN    THE  PARTIES   AS GUARANTOR     AND  LENDER    THAT  IS              TRIABLE OF RIGHT BY A JURY.         (b)   GUARANTOR     AND  LENDER   EACH   WAIVES   ANY  RIGHT  TO  TRIAL              BY JURY   WITH  RESPECT   TO  SUCH  ISSUE  TO THE  EXTENT   THAT              ANY SUCH RIGHT EXISTS NOW OR IN THE FUTURE.         THIS  WAIVER              OF  RIGHT  TO  TRIAL  BY  JURY  IS SEPARATELY    GIVEN   BY EACH              PARTY,  KNOWINGLY     AND  VOLUNTARILY     WITH  THE BENEFIT   OF              COMPETENT LEGAL COUNSEL.  28.   Notices. All Notices required under this Guaranty will be provided in accordance with        the requirements of Section 11.03 of the Loan Agreement. Guarantor's address for        Notices is as set forth on the signature page of this Guaranty unless changed in        accordance with this Section 28.  29.   Attached Schedules and Riders. The following Schedules and Riders, if marked with        an "X" in the space provided, are attached to this Guaranty:        [XI      Schedule I - State Specific Provisions        c=J      Material Adverse Change Rider        c=J      Minimum Net Worth/Liquidity Rider         [TI      Other: Additional Provisions - Sale or Securitization of Loan  30.   Attached Exhibit. The following Exhibit, if marked with an "X" in the space provided,        is attached to this Guaranty:    Guaranty - Multistate                                                    Page IO  

 

               Exhibit A       Modifications to Guaranty   IN WITNESS  WHEREOF,   Guarantor has signed and delivered this Guaranty under seal or has  caused this Guaranty to be signed and delivered under seal by its duly authorized representative.  Where applicable law provides, Guarantor intends that this Guaranty will be deemed to be signed  and delivered as a sealed instrument.             (Remainder of page intentionally left blank; signature pages follow.)    Guaranty - Multistate                                                    Page 11  

 

                                   GUARANTOR:                                      STEADFAST APARTMENT REIT, INC., a                                       Maryland corporation    Guaranty- Multistatc                                                 Page 12  

 

(a)   Guarantor's Notice Address:         Name:    Steadfast Apartment REIT, Inc.        Address: c/o Steadfast Companies                 18100 Von Karman A venue, Suite 500                 Irvine, California 92612   (b)   Guarantor represents and wmrnnts that Guarantor is:        [__  ]  married        [__  ]  single        [__lL] an entity   (c)   If Guarantor is married, then Guarantor represents and warrants that Guarantor's state of        residence is N/ A and Guarantor Spouse's state of residence is N/A   .   (d)   If Guarantor (i) is married, and (ii) Guarantor Spouse is not also a Guarantor of this Loan,        and (iii) Guarantor or Guarantor Spouse's state of residence is Alaska, Arizona, Idaho,        Louisiana, Nevada, New Mexico, Washington, or Wisconsin, then Guarantor must cause        Guarantor Spouse to sign below in accordance with Section 26 of this Guaranty.         Any person signing this Guaranty solely as a Guarantor Spouse will bind only Guarantor        Spouse's marital commlmity property and will not bind Guarantor Spouse's separate        property to the payment and pe1:for111ance of the Guarallfor's obligations under this        Guaranty.         Guarantor Spouse's Signature: ~N~/ A~----------------­       Guarantor Spouse's Printed Name: ~N=/A~----------------­       Guarantor Spouse's Address:   ~N=/A~----------------  (e)   If Guarantor is an entity, Guarantor represents and warrants that Guarantor's term of        existence, excluding any renewal or extension options:         [__lL] does not expire dming the term of the Loan.        [__  ]  expires during the term of the Loan, and that the expiration date is ______     Guaranty - Multistate                                                   Page 13  

 

                                 SCHEDULE 1                            STATE SPECIFIC PROVISIONS    Colorado      Guarantor waives the  benefit of C.R.S. Sections 13-50-101 through                 13-50-103, inclusive.    Guaranty - Multistate                                           Schedule 1 - Page 1  

 

                            RIDER TO  GUARANTY          ADDITIONAL PROVISIONS -     SALE OR SECURITIZATION OF LOAN                                 (Revised 2-19-2016)   The following changes are made to the Guaranty which precedes this Rider:   A.    Section 23 is deleted and replaced with the following:        23.   Disclosure of Information.              (a)   Guarantor acknowledges as follows:                    (i)   Lender may provide to third parties with an existing or prospective                          interest in the servicing, enforcement, evaluation, pe1formance,                          ownership, purchase, participation, or Securitization (if applicable)                          of the Loan, including any of the Rating Agencies, any entity                          maintaining databases on the underwriting and pe1formance of                          commercial mortgage loans, as well as governmental regulatory                          agencies having regulatory auth01ity over Lender, any and all                          information which Lender now has or may hereafter acquire                          relating to the Loan, the Mortgaged Property, B01Tower, any SPE                          Equity Owner, or any Guarantor, as Lender determines necessm·y                          or desirable provided that (A) the information contained in                          such disclosures is limited to information that is reasonably                          necessary in connection with the sale or Securitization at issue                          and is consistent with standard industry practices, and (B)                          such disclosures do not cause Borrower, Guarantor, any SPE                          Equity Owner or any Affiliate of any of the foregoing to be in                          breach of any Securities Laws or require any such party to                          make any additional disclosures under Securities Laws.                    (ii)  The information specified in Section 23(a)(i) may be included in                          one or more Disclosure Documents and also may be included in                          any filing with the Securities and Exchange Commission pursuant                          to the Securities Act of 1933, as amended, or the Securities                          Exchange A.ct of 193 4, as amended Securities Laws provided                          that such disclosures do not cause Borrower, Guarantor, any                          SPE Equitv Owner or any Affiliate of any of the foregoing to                          be in breach of any Securities Laws or require any such party                          to make any additional disclosures under Securities Laws.              (b)   To  the fullest extent permitted under applicable law, Guarantor                    i1Tevocably waives all rights, if any, to prohibit the disclosure of any                    inforn1ation described in Section 23(a), including any right of privacy.               (c)   For purposes of this Guaranty, the following terms have the meanings                    indicated below:                    "Disclosure Document" means any disclosure document in connection                    with a Secmitization (if applicable) or syndication of participation                    interests, including a prospectus, prospectus supplement, offering                    memorandum, private placement memorandum or similar document.   Rider to Guaranty                                                        Page 1  Additional Provisions - Sale or Securitization of Loan  

 

                  "Securities Laws" means, collectively, the United States Securities Act                    of 1933, the United States Securities Exchange Act of 1934 and any                    applicable state securities or blue sky laws, in each case as amended                    from  time to  time, together with the  rules and  regulations                    promulgated thereunder.                     "Securitization" means when the Note or any portion of the Note is                    assigned to a REMIC trust.   B.    Section 24 is deleted and replaced with the following:        24.   Lender's Rights to Sell or Securitize.               Guarantor acknowledges that Lender, and each successor to Lender's interest,              may (without prior Notice to Guarantor or Guarantor's prior consent), sell or              grant participations in the Loan (or any part of the Loan), sell or subcontract the              servicing rights related to the Loan, securitize the Loan or place the Loan in a              trust. Subject to the terms of Section 23 above, Guarantor, at its expense, agrees              to cooperate with all reasonable requests of Lender in connection with any of the              foregoing, including taking each of the following actions:               (a)   Reviewing information contained in any Disclosure Document, regarding                    anv of the following:                     (i)   Borrower.                     (ii)  SPE Equity Owner.                     (iii) Guarantor.                     (iv)  Affiliates of Borrower, SPE Equity Owner, or Guarantor.                     (v)   Property Manager.                     (vi)  The Mortgaged Property.               (b)   p£roviding a Guarantor's estoppel, and entering into an indemnification                    agreement with Lender and any Indemnified Party of any Securitization                    that includes the Loan confirming Guarantor's obligations under this                    Guaranty.               (e.£) Providing such other information about Guarantor as Lender may require                    for Lender's offering materials, including the infonnation required by                    Section 13 of this Guaranty.    Rider to Guaranty                                                        Page2  Additional Provisions - Sale or Securitization of Loan

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