Document:

<PAGE>

                                                                   EXHIBIT 10.19

                          PROPERTY MANAGEMENT AGREEMENT

     This Agreement (the "Agreement") is made as of June 20, 2001 by and between
CAC IV LIMITED PARTNERSHIP, a Virginia limited partnership (the "Owner"), and
APPLE GENERAL, INC., a Virginia Corporation (the "Manager").

                                    RECITALS:

     Owner is the owner of the real property listed on Schedule A hereto (the
"Property"). Owner has selected Manager to manage, rent and take other actions
with respect to the Property on the terms and conditions set forth in this
Agreement.

     NOW THEREFORE, for good and valuable consideration, receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:

     1. Designation of Property Manager. Owner hereby engages Manager as the
        -------------------------------
sole and exclusive manager to rent, manage and operate the Property, upon the
conditions and for the term and compensation herein set forth. All or a portion
of the services being performed by Manager may be contracted or subcontracted to
another property management company, provided that such company agrees in
writing to be bound by the terms of this Agreement.

     2. Term of Agreement. This Agreement shall be valid for an initial term of
        -----------------
two (2) years. In the event Owner sells its interest in the Property, this
Agreement will terminate as to such Property upon the date of such sale. This
Agreement shall renew automatically for successive terms of two (2) years, on
the same terms and conditions as set forth in this Agreement, unless a party
elects not to renew this Agreement by delivering written notice to the other
party at least sixty (60) calendar days before the end of any two-year term.

     3. Acceptance of Engagement. Manager hereby accepts its engagement as the
        ------------------------
manager of the Property and agrees to perform all services necessary for the
care, protection, maintenance and operation of the Property. Without limiting
the scope of the foregoing:

        (a) Manager shall collect all rents and other income from the Property,
provided that nothing herein contained shall constitute a guarantee by Manager
of the payment of rent by tenants.

        (b) Manager shall purchase, at the expense of Owner, all equipment,
tools, appliances, materials, supplies and uniforms necessary for the
maintenance or operation of the Property.

        (c) Manager shall contract on behalf of Owner for water, gas,
electricity and other services necessary for the operation and maintenance of
the Property.

<PAGE>

        (d) Manager shall advertise for the rental of units at the Property, the
cost of which shall be paid by Owner.

        (e) Manager shall use all reasonable efforts to keep the Property rented
by procuring tenants for the Property and negotiating and executing on behalf of
Owner all leases for units at the Property.

        (f) Manager shall hire, evaluate, supervise, discharge and pay all
employees or contractors necessary for the management and operation of the
Property. Owner agrees that all wages and compensation (and federal and state
unemployment insurance and other required charges) with respect to such
employees and contractors shall be paid from Owner's funds.

        (g) Manager shall prepare and file all returns and other documents
(other than promissory notes, mortgages, deeds of trust or other documents or
instruments which would encumber the Property) required under the Federal
Insurance Contributions Act and the Federal Unemployment Tax Act, or any similar
federal or state legislation. Manager also shall file returns and reports, and
pay from Owner's funds, all sums as may be required from time to time by the
state or locality in which the Property is located.

        (h) Manager shall maintain accurate and complete books of account with
entries for all receipts and expenditures, and such books of account shall be
the property of Owner and shall at all times be open to the inspection of Owner,
or any of its employees or duly authorized agents.

        (i) Manager shall deliver to Owner of all lenders' annual property
inspection letters regarding repairs necessary to avoid mortgage loan defaults.
Manager shall deliver a detailed monthly statement of all receipts and
disbursements on or before the 20th day of each month for the preceding month.
Such statement shall show the status of collections, shall be supported by
cancelled checks, vouchers, duplicate invoices and similar documentation
covering all items of income and expense, and shall be kept in Manager's office
and shall be available for inspection by Owner's representatives at all times.
Manager also shall deliver a monthly operating statement showing the income and
expense for the month, for the year-to-date and for the same month of the
preceding year. The cost of performing the accounting functions outlined in
paragraph (h) and this paragraph (i) shall be paid by Owner pursuant to the
terms of this Agreement.

        (j) Manager shall deliver to Owner annual reports containing a composite
financial report of the monthly statements provided in accordance with paragraph
(i), plus a statement by Manager as to the operations of the Property during the
previous year and recommendations, if any, as to necessary policy changes or
improvements for the forthcoming year, accompanied by an estimated budget for
such items.

        (k) Manager shall deliver to Owner from time to time, and at least
semi-annually, a tentative budget of expenses.

        (l) Manager shall deliver to Owner from time to time, and at least
annually, the following schedules with respect to the Property: (1) forecast of
rental and occupancy changes; (2)

                                       -2-

<PAGE>

review of lease negotiations; (3) annual analysis of leases; and (4)
schedule of capital improvements and method of financing such improvements.

        (m) Manager shall deliver to Owner, on a regular basis, all forms
necessary to operate and lease the Property and manage the personnel, including
but not limited to form leases, contracts and management policies.

        (n) During the initial term of this Agreement, Manager shall supervise
the transition from the former owner of the Property and shall, to the extent
necessary, implement new management systems with respect to the operation of the
Property.

     4. Deposits of Rent and Other Income. All sums received from rents, tenant
        ---------------------------------
security deposits or other deposits on units at the Property, deposits on keys
and other income from the Property, shall be deposited as collected by Manager
to the credit of Owner in such bank or banks as may be designated by Owner from
time to time. Such funds shall be disbursed only in accordance with the terms of
each particular lease and any applicable federal, state or local laws,
regulations or ordinances.

     5. Insurance. Owner shall place all insurance policies with respect to the
        ---------
Property and its operation. Manager shall be included as an insured in the
policies covering general liability, public liability and workers' compensation
insurance. In the event Manager is authorized by Owner to place insurance
policies, the companies, the general agents, the amounts of coverage and the
risks insured shall be subject to the approval of Owner.

     6. Indemnification. Owner hereby agrees to indemnify Manager against, and
        ---------------
to hold Manager harmless from, any loss, cost or expense (including reasonable
investigative expenses and legal fees), judgment, award, settlement, fine,
penalty and liability of any kind incurred by or asserted against Manager by
reason of, or in connection with, the engagement of Manager hereunder, the
performance by Manager of the services described herein or the occurrence or
existence of any event or circumstance which results or is alleged to have
resulted in any death or injury to any person, any destruction of, or damage to,
the Property, or any suit, action or proceeding (whether threatened, initiated
or completed) arising from any of the foregoing. Notwithstanding the preceding,
however, no such indemnification of Manager shall be made, and Manager shall
indemnify Owner against, and shall hold Owner harmless from, any loss that a
court of competent jurisdiction shall determine, by final adjudication, to have
resulted from willful misconduct, gross negligence or fraud by or on the part of
Manager.

     7. Compensation of Manager for Managing the Property. Owner shall pay to
        -------------------------------------------------
Manager a "Property Management Fee" for management of the Property pursuant to
this Agreement in an amount equal to five percent (5%) of the monthly gross
revenues from the Property. The Property Management Fee shall be paid to Manager
on or before the 10th day of each month and shall be based upon the income from
the Property received by Owner (for such month) by such date. If additional
income from the Property is received by Owner after such date, the sum due to
Manager with respect to such additional income shall be paid to Manager when
Manager is paid its fees for the next succeeding month.

                                       -3-

<PAGE>

     8. Reimbursement of Expenses. Owner shall reimburse Manager for Manager's
        -------------------------
expenses, including salaries and related overhead expenses, associated with
bookkeeping, accounting and financial reporting services pertaining to the
Property.

     9. Reserves for Capital Items. Owner acknowledges that the budget of
        --------------------------
expenses prepared by Manager, pursuant to paragraph 3(k), shall contain a
category labeled "Reserve for Capital Items." Owner agrees to place rents and
other income in a bank account, or to permit Manager to transfer Owner's funds
to such account, in sufficient amounts to meet the needs reflected in such
budget. Such funds shall be placed in the account on a monthly basis as
reflected in the budget.

     10. Cash Flow. Owner acknowledges that the budget of expenses prepared by
         ---------
Manager, pursuant to paragraph 3(k), shall contain a category labeled "Cash
Flow." Owner agrees, in the event that the budgeted cash flow for the Property
is negative in any month covered by the budget, to place sufficient funds in a
bank account, or to permit Manager to transfer Owner's funds to such account, to
correct the budgeted operating deficit. Such funds shall be placed in such
account at least forty-five (45) calendar days before the budgeted deficit is to
occur.

     11. Power of Attorney. Owner hereby makes, constitutes and appoints Manager
         -----------------
as Owner's true and lawful attorney-in-fact, for Owner and in its name, place
and stead and for its use and benefit, to sign, acknowledge and file all
documents and agreements (other than promissory notes, mortgages, deeds of trust
or other documents or instruments which would encumber the Property) necessary
to perform or effect the duties and obligations of Manager under the terms of
this Agreement. The foregoing power of attorney is a special power of attorney
coupled with an interest, and may only be terminated by canceling this Agreement
as provided herein.

     12. Relationship of Parties. The parties agree and acknowledge that Manager
         -----------------------
is, and shall operate as, an independent contractor in performing duties and
services under this Agreement, and shall not be deemed an employee or agent of
Owner.

     13. Entire Agreement. This Agreement represents the entire understanding
         ----------------
between the parties hereto with regard to the transactions described herein and
may only be amended by a written instrument signed by the party against whom
enforcement is sought.

     14. Governing Law. This Agreement shall be construed in accordance with,
         -------------
and be governed by, the laws of the Commonwealth of Virginia, without regard to
any rules or principles thereof regarding choice or conflicts of laws.

                          (next page is signature page)

                                       -4-

<PAGE>

WITNESS the following signatures:

OWNER:                              CAC IV LIMITED PARTNERSHIP
-----                               a Virginia limited partnership

                                    By:  CAC IV Special General, Inc.
                                         a Virginia Corporation

                                    Title:   General Partner

                                              /s/ Stanley J. Olander, Jr.
                                              ----------------------------------
                                              By:      Stanley J. Olander, Jr.
                                              Title:   Vice President

MANAGER:                            APPLE GENERAL, INC.,
-------                             a Virginia Corporation

                                    By:      /s/ Stanley J. Olander, Jr.
                                             -----------------------------------
                                    Name:    Stanley J. Olander, Jr.
                                    Title:   Vice President

                                       -5-

<PAGE>

                                   Schedule A

                                    Property

The Property consist of that real property, together with all improvements
thereon, which is located at the following address:

         Burney Oaks Apartments
         2502 Burney Oaks Lane
         Arlington, Texas  76006

                                       -6-<PAGE>

                                                                   EXHIBIT 10.20

                     REAL ESTATE PURCHASE AND SALE AGREEMENT

                     PRINCIPAL LIFE INSURANCE COMPANY f/k/a
                 PRINCIPAL MUTUAL LIFE INSURANCE COMPANY, SELLER

                                       and

                  CORNERSTONE REALTY INCOME TRUST, INC., BUYER

<PAGE>

                                    INDEX TO

                     REAL ESTATE PURCHASE AND SALE AGREEMENT

1.   Property Included in Sale .............................   1

2.   Purchase Price/Remedies ...............................   2

3.   Title to the Property .................................   3

4.   Buyer's Due Diligence .................................   3

5.   Buyer's Conditions to Closing .........................   7

6.   Seller's Conditions to Closing ........................   8

7.   The Closing ...........................................   9

8.   Representations and Warranties ........................   11

9.   Leasing and Indemnification ...........................   13

10.  Condition of Property .................................   13

11.  Possession ............................................   15

12.  Tax-Deferred Exchange .................................   16

13.  Miscellaneous .........................................   16

<PAGE>

                     REAL ESTATE PURCHASE AND SALE AGREEMENT

     THIS REAL ESTATE PURCHASE AND SALE AGREEMENT (the "Agreement"), is made as
of the 8/th/ day of June, 2001 (the "Agreement Date") by and between PRINCIPAL
       -----
LIFE INSURANCE COMPANY f/k/a PRINCIPAL MUTUAL LIFE INSURANCE COMPANY, an Iowa
corporation, herein referred to as "Seller", and CORNERSTONE REALTY INCOME
TRUST, INC., a Virginia corporation, herein referred to as "Buyer."

                                R E C I T A L S:

     WHEREAS, Seller desires to sell certain improved real property along with
certain related personal and intangible property, and Buyer desires to purchase
said real, personal and intangible property on the terms and conditions set
forth herein;

     NOW, THEREFORE, in consideration of the foregoing and the mutual
undertakings set forth herein, and for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Buyer and Seller
hereby agree as follows:

     1. Property Included in Sale. Seller hereby agrees to sell and convey to
        -------------------------
Buyer, and Buyer hereby agrees to purchase from Seller, the following:

        (a) that certain real property commonly known as Chase Gayton Apartments
(328 units) at 100 Chase Gayton Drive, Richmond, Virginia, and more particularly
described in Exhibit A attached hereto (the "Real Property");

        (b) Seller's interest in all rights, privileges and easements
appurtenant to the Real Property, including, without limitation, all minerals,
oil, gas and other hydrocarbon substances as well as all development rights, air
rights, water, water rights (and water stock, if any) relating to the Real
Property and any easements, rights-of-way or other appurtenances used in
connection with the beneficial use and enjoyment of the Real Property;

        (c) Seller's interest in all improvements and fixtures located on the
Real Property, including all buildings and structures presently located on the
Real Property, all apparatus, equipment and appliances used in connection with
the operation or occupancy of the Real Property, such as heating and air
conditioning systems and facilities used to provide any utility services,
refrigeration, ventilation, garbage disposal, recreation or other services on
the Real Property (all of which are collectively referred to as the
"Improvements");

        (d) Seller's interest in any tangible or intangible personal property
owned by Seller and used in the ownership, use and operation of the Real
Property and Improvements, including, without limitation, the right to use any
trade name (excepting those including the name "Principal") now used in
connection with the Real Property (the "Personal Property") and any contract or
lease rights, agreements, utility contracts, management, maintenance and

<PAGE>

service contracts or other rights relating to the ownership, use and
operation of the Real Property.

        All of the items referred to in subparagraphs (a), (b), (c) and (d)
above are hereinafter collectively referred to as the "Property."

     2. Purchase Price/Remedies.
        -----------------------

             (a) The total purchase price (the "Purchase Price") for the
Property is Twenty-One Million One Hundred Seventy Five Thousand Dollars
($21,175,000). The Purchase Price is payable by wire transfer of immediately
available funds in U.S. dollars via the federal bank wire transfer system
deliverable no later than 12:00 p.m. Central on the Closing Date (as defined
herein) to LandAmerica, National Commercial Services, 10 South LaSalle Street,
Suite 2500, Chicago, Illinois 60603, Attn: Thomas M. Gray, Vice President
(telephone: 312/553-6900; fax: 312/553-6910) (the "Title Company") at Closing.

        (b)  Within two (2) business days of the Agreement Date, Buyer shall
deposit into escrow with the Title Company the sum of $100,000 as the earnest
money deposit (the "Initial Deposit"). Provided that Buyer has not terminated
this Agreement prior to the Approval Date, Buyer shall deposit an additional
$100,000 ("Additional Deposit") within two (2) business days after the Approval
Date. (The Initial Deposit and the Additional Deposit are collectively referred
to herein as the "Deposit".) Any interest earned by the Deposit shall be
considered part of the Deposit. Except as otherwise provided in this Agreement,
the Deposit shall be held by the Title Company in a federally insured interest
bearing account and applied against the cash portion of the Purchase Price at
Closing.

        (c) In the event the purchase and sale provided for under this Agreement
does not close due to a breach by Buyer, Buyer and Seller hereby agree that
Seller will be damaged thereby. Therefore, Seller and Buyer hereby agree that
the Deposit shall represent and be liquidated damages payable to Seller in such
event as a fair and reasonable sum to recompense Seller in light of Seller's
removal of the Property from the market and the costs incurred, labor and
services performed and the loss of its bargain, all of which are difficult to
ascertain. These liquidated damages shall constitute Seller's sole and exclusive
remedy except for those certain indemnifications of Seller by Buyer otherwise
provided for in this Agreement

        (d) In the event that Seller shall be in default hereunder, Buyer's sole
and exclusive remedy shall be either: (i) deliver a written notice to Seller
within three (3) business days of learning of such default, stating with
particularity the alleged default of Seller and the action required by Seller to
cure such default, and stating Buyer's intent to terminate this Agreement if the
default is not cured, whereupon Seller shall have seven (7) business days after
receipt of such written notice in which to cure the alleged default to Buyer's
reasonable satisfaction and to thereby prevent termination of this Agreement
(and the Closing Date shall be delayed, if necessary, until the end of such
seven (7) business day period), or in the event such default is not cured within
such seven (7) business day period, terminate this Agreement by written notice
to Seller and the Title Company, in which case the Deposit shall be returned

                                      -2-

<PAGE>

to Buyer; or (ii) if Seller's default results from its failure to transfer
possession and title to the Property to Buyer at Closing, enforce specific
performance. In no event under (i) or (ii) above shall Seller be liable to Buyer
for any actual, punitive, speculative, consequential or other damages.
Notwithstanding the foregoing, in the event Buyer successfully enforces specific
performance, Seller shall reimburse Buyer for all reasonable and verifiable
legal fees, costs and expenses directly related to the pursuit of such
enforcement.

        3. Title to the Property. At the Closing, Seller shall convey to Buyer
           ---------------------
and Buyer shall accept marketable and insurable fee simple title to the Real
Property, all rights, privileges and easements appurtenant thereto, and to the
Improvements, by duly executed and acknowledged Deed of Bargain and Sale
attached hereto as Exhibit H (the "Deed"). Evidence of delivery of marketable
and insurable fee simple title shall be the issuance of a current ALTA Owner's
Policy of Title Insurance (the "Title Policy"), in the full amount of the
Purchase Price by the Title Company, insuring fee simple title to the Real
Property, Improvements, and appurtenant rights, privileges and easements, in the
Buyer.

        4. Buyer's Due Diligence. Buyer shall be allowed to conduct the
           ---------------------
following due diligence prior to purchasing the Property:

           (a) Buyer's review of title to the Property as shown on an existing
preliminary title report (the "Title Report") from the Title Company and an
existing as-built survey showing the location of all improvements and recorded
easements on the Property (the "Survey"), both of which shall be delivered by
Seller with the other Due Diligence Items. Within ten (10) business days after
Buyer's receipt of the Title Report and Survey (the "Title Documents"), Buyer
may approve or disapprove (in its sole and absolute discretion) the Title
Documents for the Property by delivering written notice to Seller ("Buyer's
Title Notice") specifying each title defect or matter for which Buyer is
requesting a cure by Seller ("Title Defect") and each Title Company requirement
("Title Requirement") which Buyer is requesting Seller to satisfy in order for
the Title Policy to be issued for the Property at Closing. Buyer's failure to
deliver Buyer's Title Notice to Seller within the time period specified above
shall be a conclusive presumption that Buyer has approved the Title Documents
and this Agreement shall remain in full force and effect. Within five (5)
business days after receiving Buyer's Title Notice, Seller shall deliver to
Buyer written notice ("Seller's Title Notice") of those Title Defects which
Seller covenants and agrees to either eliminate or cure to Buyer's satisfaction
by the Closing Date and those Title Requirements which Seller agrees to satisfy
by the Closing Date. Seller's failure to deliver Seller's Title Notice to Buyer
within the time period specified above shall be deemed to constitute Seller's
election not to eliminate or cure any such Title Defect or to satisfy any such
Title Requirements. If Seller elects (or is deemed to have elected) not to
eliminate or cure any Title Defects or to not satisfy any Title Requirements,
the Buyer shall have the right, by written notice delivered to Seller within
five (5) business days of Seller's Title Notice or within five (5) business days
after the expiration of the time period during which Seller is entitled to
deliver Seller's Title Notice, whichever occurs first, to either i) waive its
prior notice as to the Title Defects which Seller has elected not to cure and
those Title Requirements which Seller has elected not to satisfy or (ii)
terminate this Agreement as provided later in this section. Buyer's failure to
deliver any written notice within such five (5)

                                      -3-

<PAGE>

business day period shall be a conclusive presumption that Buyer has approved
the Title Documents and this Agreement shall remain in full force and effect.

        (b) Buyer's review of the operating statements of the Property only for
the previous two (2) calendar years as well as the current calendar
year-to-date, provided same are available and in Seller's actual possession or
in possession of the Property Manager.

        (c) Buyer's review of copies of any tenant leases, and any amendments
and modifications thereto, currently in the possession of the Seller or in
possession of the Property Manager.

        (d) Buyer's review of Seller's current rent roll, currently in the
possession of Seller or in possession of the Property Manager.

        (e) Buyer's review of Seller's current real estate tax bills for the
property, currently in the possession of Seller or in possession of the Property
Manager.

        (f) Buyer's review of Seller's current utility bills for the most recent
twelve (12) month period, currently in the possession of Seller or in possession
of the Property Manager.

        (g) Buyer's review of copies of any site plans and building drawings and
specifications currently in the possession of the Seller or in possession of the
Property Manager.

        (h) Buyer's review of copies of any management, maintenance and service
agreements currently in force and in the possession of the Seller. Buyer shall
provide written notice to Seller no less than three (3) business days prior to
the Approval Date of those agreements Buyer wishes to assume. In the absence of
such notice, Seller shall terminate all agreements.

        (i) Buyer's review of certain environmental reports prepared for Seller
in the ordinary course of business and relied upon by Seller by Froehling &
Robertson, Inc. and dated April 26, 1999. Seller is providing such reports to
Buyer for informational purposes only and Buyer shall not rely on such reports
in determining whether to purchase the Property. In the event the transaction
contemplated herein does not close for any reason whatsoever, Buyer shall
immediately return the reports to Seller.

        The items referred to above in subparagraphs 4(a)-(i) and any other
items provided by Seller to Buyer shall be collectively referred to as the "Due
Diligence Items." Seller agrees to provide the Due Diligence Items on a date
(the "Delivery Date") which is within five (5) business days of Seller's receipt
of a fully-executed Confidentiality Agreement.

        (j) Buyer's review of the physical and environmental characteristics and
condition of the Property. Seller agrees to provide Buyer access to the Property
following the Agreement Date for the purpose of performing, at Buyer's sole cost
and expense, studies,

                                      -4-

<PAGE>

physical inspections, investigations and tests on the Property (the "Tests")
provided that no such tests shall be conducted without at least two (2) business
days prior written notice to Seller and Seller's prior approval of such Tests,
which approval shall not be unreasonably withheld. Buyer's access is further
conditioned on Buyer providing Seller with certificates of insurance listing
Seller as an additional insured on all insurance policies evidencing that
Buyer's agents or contractors performing said Tests have insurance in types and
amounts satisfactory to Seller as determined by Seller in its reasonable
discretion. Buyer shall be required to conduct such Tests in a manner as to not
disturb or interfere with the current use of the Property and upon completion of
such Tests, Buyer agrees at its sole cost to restore the Property to the
condition it was in immediately prior to such Tests, including, but not limited
to the immediate removal of anything placed on the Property in connection with
such Tests. Copies of any reports, letters or other written information
generated as a result of such Tests shall be provided to Seller if the sale
contemplated by this Agreement does not close for any reason. Buyer shall
indemnify, defend (with counsel reasonably satisfactory to Seller), protect, and
hold Seller harmless from and against any and all liability, loss, cost, damage,
or expense (including, without limitation, attorney's fees and costs) which
Seller may sustain or incur by reason of or in connection with any Tests made by
Buyer or Buyer's agents or contractors relating to or in connection with the
Property, or entries by Buyer or its agents or contractors onto the Property.
Notwithstanding any provision to the contrary in this Agreement, the indemnity
obligations of Buyer under this Agreement shall survive any termination of this
Agreement or the delivery of the deed and the transfer of title pursuant to this
Agreement.

            If on or before 5:00 p.m. Central on June 8, 2001, (the "Approval
Date"), Buyer disapproves any of the Due Diligence Items or the physical and
environmental condition of the Property by providing Seller with written notice,
this Agreement shall terminate without any liability on the part of either
party, except for Buyer's indemnity obligations set forth in paragraph 4 above.
In the event of such termination, the Initial Deposit, shall be returned to
Buyer. If by 5:00 p.m. Central on the Approval Date Buyer approves of the Due
Diligence Items and the physical and environmental condition of the Property by
providing Seller with written notice, then this Agreement shall remain in full
force and effect the Buyer shall deposit the Additional Deposit as set forth in
paragraph 2(b) above, and the Deposit shall be held by the Title Company and
credited to Seller as provided herein. If by 5:00 p.m. Central on the Approval
Date Buyer does not waive or deem satisfied in writing the Due Diligence Items
and the physical and environmental condition of the Property, there shall be a
conclusive presumption that Buyer has approved the Due Diligence Items and the
physical and environmental condition of the Property, this Agreement shall
remain in full force and effect, the Buyer shall deposit the Additional Deposit
as set forth in paragraph 2(b) above, and the Deposit shall be held by the Title
Company and credited to the Seller as provided herein.

     5. Buyer's Conditions to Closing. The following conditions are conditions
        -----------------------------
precedent to Buyer's obligation to purchase the Property:

        (a) Seller maintaining the Property in its present condition until
Closing, reasonable wear and tear excepted. Seller shall bear all risk of loss
or damage by every casualty prior to Closing Date. In the event that, prior to
Closing, the Property, or any part

                                      -5-

<PAGE>

thereof, is destroyed or materially damaged, and such damage exceeds
$150,000.00, or if condemnation proceedings are commenced against the Property
resulting in an award in excess of $150,000, taking any part of the improvements
or in excess of ten percent (10%) of the parking , Buyer shall have the right,
exercisable by giving notice of such decision to Seller within ten (10) business
days after receiving written notice of such damage, destruction or condemnation
proceedings, to terminate this Agreement, in which case neither party shall have
any further rights or obligations hereunder. In the event of such termination,
the Deposit shall be returned to Buyer. If Buyer elects to accept the Property
in its then condition, all proceeds of insurance or condemnation awards payable
to Seller by reason of such damage, destruction or condemnation shall be paid or
assigned to Buyer and Seller shall credit the Purchase Price to the extent of
any deductible under any policies of insurance, which credit shall not exceed
the amount of such damages. In the event the casualty damage to the Property is
$150,000.00 or less, Buyer shall accept the Property in its then condition and
proceed with the purchase, in which case Buyer shall accept payment or
assignment of applicable insurance proceeds, if any, from policies of insurance
maintained and paid for by Seller covering the Property up to the amount
necessary to make the necessary repairs or restorations and Seller shall credit
the Purchase Price to the extent of any deductible under any policies of
insurance, which credit shall not exceed the amount of such damages.

     (b) Delivery by Seller at Closing of the Deed.

     (c) Delivery by Seller of the Assignment and Assumption of Leases in the
form attached hereto as Exhibit B.

     (d) Delivery by Seller of an Assignment of Warranties, Guaranties and
Service Contracts in the form attached hereto as Exhibit G;.

     (e) Performance by Seller as and when required by this Agreement of each
and every term, covenant, condition and agreement required to be performed by
Seller pursuant to this Agreement.

     (f) All units are to be in rent ready condition (defined as containing
carpet, refrigerator, range, garbage disposal, heating, plumbing and electrical
systems).

     (g) All personal property (as set forth on Exhibit K) and all mechanical,
electrical, heating, air conditioning, sewer, water and plumbing systems will be
in working order and in the same condition as on the Approval Date.

     In the event that the conditions set forth above in this paragraph 5 are
not satisfied (and Buyer is not otherwise in default of this Agreement), Buyer
may terminate this Agreement, subject to paragraph 2(d) hereof, or waive
satisfaction of the condition and close escrow in either instance by giving
written notice to Seller. In the event of such termination, for reasons
described in (b) - (g) above, the Deposit shall be returned to Buyer.

                                       -6-

<PAGE>

        6. Seller's Conditions to Closing. The following conditions are
           ------------------------------
conditions precedent to Seller's obligation to sell the Property:

              (a) The approval of the applicable committee of Seller (the
"Committee"), which approval Buyer acknowledges Seller will not seek until the
Approval Date has passed and Buyer has failed to exercise its right of
termination of this Agreement under paragraph 4. Seller makes no representation
with regard to the likelihood of approval of this Agreement or the transaction
contemplated herein by its Committee. Seller shall have a period of fifteen (15)
business days after the Approval Date to obtain such approval by its Committee.
If for any reason Seller's Committee does not approve this Agreement or the
transaction contemplated herein, this Agreement shall terminate, the Title
Company shall return the Deposit to Buyer and neither party shall have any
further obligations or rights hereunder. Notwithstanding the above, in the event
of such termination, Seller agrees to reimburse Buyer for its reasonable and
verifiable out of pocket due diligence expenses up to a maximum of $35,000.00,
including but not limited to title and survey expenses, third party report
expenses and reasonable attorney's fees.

              (b) Delivery by Buyer at Closing of the Purchase Price and the
executed Assignment and Assumption of Leases in the form attached hereto as
Exhibit B.

              (c) Performance by Buyer as and when required by this Agreement of
each and every term, covenant, condition and agreement required to be performed
by Buyer pursuant to this Agreement.

                  In the event that the conditions in this paragraph 6 are not
satisfied, Seller may elect, at its sole discretion, to terminate this Agreement
or waive satisfaction of the condition and close escrow. In the event of such
termination, for reasons described in (b) or (c) above, the Deposit shall be
retained by Seller and shall be non-refundable to the Buyer.

        7. The Closing.
           -----------

              (a) The Closing hereunder shall be held and delivery of all items
to be made at the Closing under the terms of this Agreement shall be made at the
offices of the Title Company within five (5) business days of Seller's Committee
approval, or such other date prior thereto as Buyer and Seller may mutually
agree in writing (the "Closing Date"). Buyer shall have a one-time right to
extend the Closing Date for an additional fifteen (15) business days, provided
that, on or before the original Closing Date, Buyer gives Seller notice of such
extension and deposits an additional non refundable deposit in the amount of
$200,000.00 with the Title Company. ("Extension Deposit"), which shall be held
by the Title Company and credited to Seller. Such date may not be further
extended without the prior written approval of both Seller and Buyer. The
Initial Deposit, the Additional Deposit and the Extension Deposit are
hereinafter collectively referred to as "Deposit." In the event the Closing does
not occur on or before the Closing Date and is not extended, as provided for
herein, the Title Company shall, subject to the provisions of paragraph 2, and
unless it is notified by both parties to the contrary, within three (3) business
days after the Closing Date, return to the depositor thereof

                                       -7-

<PAGE>

items which may have been deposited pursuant to this Agreement. Any such return
shall not, however, relieve either party hereto of any liability it may have for
its wrongful failure to close.

         (b)  At or before the Closing, Seller shall deliver to escrow the
following:

              (i)    the Deed conveying to the Buyer the Property as required by
paragraph 3 above;

              (ii)   originals or copies of all leases (and amendments thereto,
if any) covering any portion of the Property, any security deposits relating
thereto in Seller's possession, and an executed Assignment and Assumption of
Leases in the form attached hereto as Exhibit B;

              (iii)  Seller's Non-Foreign Certification in the form attached as
Exhibit C.

              (iv)   notices to the tenants at the Property in the form attached
as Exhibit D, executed by Seller.

              (v)    the executed Assignment of Warranties, Guaranties and
Service Contracts in the form attached hereto as Exhibit G.

              (vi)   an executed Bill of Sale in the form attached hereto as
Exhibit I.

              (vii)  a standard termite bond or similar coverage to the extent
carried by Seller with all corrective work done as needed.

              (viii) a rent roll created in the ordinary course and relied upon
by Seller.

              (ix)   an affidavit with respect to judgments, in the form
provided by the Title Company.

              (x)    An affidavit of hazardous materials in the form provided by
the Title Company.

              (xi)   A termination of the existing management agreement.

              (xii)  A representation letter, in the form attached hereto as
Exhibit L.

         Buyer may waive compliance on Seller's part under any of the foregoing
items by an instrument in writing.

         (c)  At or before the Closing, Buyer shall deliver to escrow the
Purchase Price and an executed Assignment and Assumption of Leases in the form
attached hereto as Exhibit B.

                                       -8-

<PAGE>

     (d)  Seller and Buyer shall each deposit such other instruments as are
reasonably required by the escrow holder to close the escrow and consummate the
purchase of the Property in accordance with the terms hereof.

     (e)  Prorations
          ----------

          (i) In each proration set forth below, the portion thereof applicable
to the period beginning at 12:01 a.m. on the date the deed is recorded shall be
credited to Buyer and the portion thereof applicable to the period ending at
such time shall be credited to Seller. Prorations shall be
calculated on the basis of a 365-day year.

              (A) Collected Rent. All collected rent (excluding tenant
                  --------------
reimbursements for Operating Costs) and other collected income (and any
applicable state or local tax on rent) under Leases in effect on the Closing
Date shall be prorated as of the Closing. Buyer shall be credited with any rent
and other income collected by Seller before Closing but applicable to any period
of time after Closing. Uncollected rent and other income shall not be prorated.
Any rent received by Seller after the Closing with respect to time periods after
the Closing shall be delivered to Buyer within 10 days of Seller's receipt.
Buyer shall apply rent and other income from tenants that are collected after
the Closing first to the obligations then owing to Buyer for its period of
ownership and to those reasonable attorney fees incurred by Buyer in collecting
said amount, remitting the balance, if any, to Seller. Buyer will make
reasonable efforts, without suit, to collect any rents from tenants in occupancy
at Closing applicable to the period before Closing. Seller may pursue collection
as to any rent not collected by Buyer within 6 months following the Closing
Date, provided that Seller shall have no right to terminate any Lease or any
tenant's occupancy under any Lease in connection therewith. Seller is not
restricted in any way from collecting any rent or other income owed by past
tenants who are no longer in occupancy at Closing.

              (B) Operating Costs. Seller, as landlord under the Leases, may be
                  ---------------
currently collecting from tenants under the Leases additional rent to cover
taxes, insurance, utilities (to the extent not paid directly by tenants), common
area maintenance and other operating costs and expenses (collectively,
"Operating Costs") in connection with the ownership, operation, maintenance and
 ---------------
management of the Real Property. Seller and Buyer shall each receive a debit or
credit, as the case may be, for the difference between the tenants' current
account balances for Operating Costs and amount of Operating Costs reimbursable
to Seller. The parties shall reasonably estimate Operating Costs for Seller's
period of ownership if final bills are not available. Those Operating Costs
being paid directly by tenant shall not be prorated. Operating Costs that are
not payable by tenants either directly or reimbursable under the Leases shall be
prorated between Seller and Buyer on an accrual basis.

              (C) Taxes and Assessments. Real estate taxes and assessments
                  ---------------------
imposed by governmental authority that are not yet due and payable and that are
not reimbursable by tenants under the Leases as Operating Costs shall be
prorated as of the Closing based upon the most recent ascertainable assessed
values and tax rates. Seller shall receive a credit for any taxes and
assessments paid by Seller and applicable to any period after

                                       -9-

<PAGE>

the Closing. All refunds or tax savings relating to real estate taxes shall
inure to the benefit of Seller if such refunds or tax savings relate to any
period for which Seller owned the Property. Buyer shall remit to Seller any such
refund or tax savings relating to such period immediately upon Buyer's receipt,
after deducting any amounts due to tenants under the Leases. Any additional
taxes relating to the year of Closing or prior years arising out of a change in
the use of the Property or a change in ownership shall be assumed by Buyer
effective as of Closing and paid by Buyer when due and payable, and Buyer shall
indemnify Seller from and against any and all such taxes, which indemnification
obligation shall survive the Closing.

               (D) Final Adjustment After Closing. If final prorations cannot be
                   ------------------------------
made at Closing for any item being prorated under this section, then Buyer and
Seller agree to allocate such items on an accrual basis as soon as invoices or
bills are available and applicable reconciliation with tenants have been
completed, with final adjustment to be made no later than forty-five (45) days
after Closing. Income and expenses shall be received and paid by the parties on
an accrual basis with respect to their period of ownership. Seller shall not,
however, be charged for any increase in Operating Costs due to increased costs
incurred by Buyer in respect of such subsequent to the Closing. Payments in
connection with the final adjustment shall be due within 30 days of written
notice. Each party shall have reasonable access to, and the right to inspect and
audit the other party's supporting documentation to confirm the final
prorations; provided at least three (3) business days advance notice is given by
the auditing party to the audited party.

         (ii)  Tenant Deposits. All tenant security deposits actually received
               ---------------
by Seller (and interest thereon if required by law or contract to be earned
thereon) and not theretofore applied to tenant obligations under the Leases
shall be transferred or credited to Buyer at Closing or placed in escrow if
required by law. As of the Closing, Buyer shall assume Seller's obligations
related to tenant security deposits. Buyer will indemnify, defend, and hold
Seller harmless from and against all demands and claims made by tenants with
respect to any security deposits and will reimburse Seller for all attorneys'
fees incurred or that may be incurred as a result of any such claims or demands
as well as for all loss, expenses, verdicts, judgments, settlements, interest,
costs and other expenses incurred or that may be incurred by Seller as a result
of any such claims or demands by tenants. Seller will indemnify, defend, and
hold Buyer harmless from and against all demands and claims made by tenants with
respect to any security deposits not delivered to Buyer at Closing and will
reimburse Buyer for all attorneys' fees incurred or that may be incurred as a
result of any such claims or demands as well as for all loss, expenses,
verdicts, judgments, settlements, interest, costs and other expenses incurred or
that may be incurred by Buyer as a result of any such claims or demands by
tenants.

         (iii) Utility Deposits. Buyer shall take all steps necessary to
               ----------------
effectuate the transfer of all utilities to its name as of the Closing Date, and
where necessary, post deposits with the utility companies. Seller shall ensure
that all utility meters are read as of the Closing Date. Seller shall be
entitled to recover any and all deposits held by any utility company as of the
Closing Date.

         (iv)  Insurance. The fire, hazard, and other insurance policies
               ---------
relating to the

                                      -10-

<PAGE>

Property shall be cancelled by Seller as of the Closing Date and shall not,
under any circumstances, be assigned to Buyer. All unearned premiums for fire
and any additional hazard insurance premium or other insurance policy premiums
with respect to the Property shall be retained by Seller.

          (f)  The costs incurred in this transaction shall be allocated as
 follows:

               (i)   Buyer shall pay for the Title Policy. Buyer shall pay for
any special endorsements to the title policy and any extended coverage if Buyer
requires any such endorsements or extended coverage.

               (ii)  Buyer shall pay the cost of any recording fees applicable
to the deed, however, Seller shall be responsible for any costs for recordation
of any releases of Seller's existing mortgage.

               (iii) Buyer shall pay the cost of any State and City transfer
taxes applicable to the deed; provided, however Seller shall be responsible for
the grantor's tax on the deed in accordance with Section 58.1-802 of the Case of
Virginia (1950) as amended

               (iv)  Buyer shall pay the cost of any update of the Survey.

               (v)   Each party shall pay its own legal fees and expenses.

     8.   Representations and Warranties.
          ------------------------------

          (a)  Seller hereby represents and warrants to Buyer as follows:

               (i)   Seller is a corporation duly organized and validly existing
under the laws of the State of Iowa and is in good standing under the laws of
the state in which the Property is located.

               (ii)  All closing documents executed by Seller which are to be
delivered to Buyer at the Closing are or at the Closing will be duly authorized,
executed, and delivered by Seller, are or at the Closing will be legal, valid,
and binding obligations of Seller, are sufficient to convey title, and do not
violate any provisions of any agreement to which Seller is a party or to which
it is subject.

               (iii) Except as otherwise disclosed to Buyer in the Due Diligence
Items, to the Seller's Knowledge (as hereinafter defined), there are no liens,
security interests, covenants, conditions, restrictions, rights-of-way,
easements or encumbrances of any kind or character whatsoever, encumbering the
Property other than those set forth in the Title Report and/or Survey.

                                      -11-

<PAGE>

               (iv)   Except as set forth on Exhibit J, there is no pending
litigation which materially affects the use and operation of the Property or
Seller's ability to fulfill all of its obligations under this Agreement.

               (v)    Except as otherwise provided in the Due Diligence Items,
to the Seller's Knowledge, Seller has not received any written notice from a
governmental entity of a claim that the Property does not comply with all laws,
ordinances, rules and regulations.

               (vi)   Seller is not a foreign corporation, foreign partnership,
foreign trust or foreign estate (as defined in the Internal Revenue Code
("Code")).

               (vii)  Except as otherwise provided in the Due Diligence Items,
to the Seller's Knowledge, there is no existing condemnation action with respect
to the Property which would materially affect the use and operation of the
Property.

               (viii) To Seller's Knowledge, Seller has provided true and
correct copies of all leases and amendments thereto pertaining to the Property.

               The foregoing representations and warranties shall be in full
force and effect on the Agreement Date and at the Closing. Such representations
and warranties shall be deemed to have been reaffirmed and restated by Seller as
of the Closing Date, except for any material change in any of the foregoing
representations or warranties or any material breach thereof that occurs and
which is expressly disclosed by Seller to Buyer in writing at any time and from
time to time prior to the Closing (each a "Disclosure" and collectively, the
"Disclosures"), which Disclosures shall thereafter be updated by Seller prior to
the Closing Date. If any change in any of the foregoing representations or any
breach of any of the foregoing warranties or agreements is a material change or
breach, and Seller does not elect to cure such matters within twenty (20)
business days after Seller's receipt of a written request from Buyer to do so,
or does not agree in writing within said twenty (20) business day period to
indemnify Buyer against and hold Buyer harmless from any and all losses,
liabilities, claims, costs and expenses incurred by Buyer as a result thereof,
then, notwithstanding anything contained herein to the contrary, Buyer, at its
sole option, and as its sole remedy, may either (a) close and consummate the
transaction contemplated by this Agreement, without reduction in the Purchase
Price or (b) terminate this Agreement by written notice to Seller, whereupon the
Title Company shall return the Deposit to Buyer and the parties shall have no
rights or obligations hereunder, except for those which expressly survive any
such termination. Such election shall be made by Buyer within five (5) business
days after receipt of notice from Seller that Seller has elected not to cure or
indemnify Buyer with respect to such material change or breach. Failure of Buyer
to cause Seller to receive notice of such election of Buyer within such five (5)
business days period shall conclusively be construed as Buyer's having elected
alternative (a) above. The Closing Date shall be postponed automatically, if
necessary, to permit the full running of such thirty (30)-day period. The term
"Seller's Knowledge" as used herein means the actual knowledge (and not the
implied or constructive knowledge) without any duty of investigation or inquiry
of the following persons: Mark Scholz, Assistant Director. All covenants,
agreements, representations and warranties made by Seller in this

                                      -12-

<PAGE>

Agreement shall survive the Closing for no longer than six (6)
months and written notification of any claim arising therefrom must be received
in writing by Seller within such six (6) month period or such claim shall be
forever barred and Seller shall have no liability with respect thereto. The
aggregate liability of the Seller, with respect to all claims hereunder, shall
not exceed $100,000.00. Notwithstanding the foregoing, no representation,
warranty, covenant or agreement made in this
Agreement by Seller shall survive the Closing relative to any matters disclosed
in the Due Diligence Items or known to Buyer to be untrue or incorrect and of
which Seller is not notified by Buyer prior to or at the Closing. Buyer is
deemed to have constructive knowledge of all information contained in the Due
Diligence Items that could be reasonably inferred from such Due Diligence Items.
Buyer further acknowledges it has a duty of investigation and inquiry in
determining whether or not the Property is suitable for its purpose.

        (b) Buyer hereby represents and warrants to Seller as follows: (i) Buyer
is a corporation, duly organized and validly existing under the laws of the
State of Virginia and is in good standing under the laws of the State in which
the Property is located; (ii) all documents executed by Buyer which are to be
delivered to Seller at Closing are or at the Closing will be duly authorized,
executed, and delivered by Buyer, and are or at the Closing will be legal,
valid, and binding obligations of Buyer, and do not and at the Closing will not
violate any provisions of any agreement to which Buyer is a party or to which it
is subject; (iii) Buyer shall furnish all of the funds for the purchase of the
Property (other than funds supplied by institutional lenders which will hold
valid mortgage liens against the Property) and such funds will not be from
sources of funds or properties derived from any unlawful activity; and (iv)
Buyer is a sophisticated investor with substantial experience in investing in
assets of the same type as the Property and has such knowledge and experience in
financial and business matters that Buyer is capable of evaluating the merits
and risks of an investment in the Property.

        (c) Seller hereby covenants that between the Agreement Date and the
Closing Date, Seller shall continue to maintain, operate and manage the Property
in a manner consistent with its prior practices, making every reasonable effort
to do nothing which might damage the reputation of the Property or the
relationships with the tenants. If the leases of any of the tenants expire
before thirty (30) days after the Closing Date, Seller shall, up to the Closing
Date and without cost to Buyer, continue its normal course of operation with
respect to causing tenants to be obtained for unrented units.

     9. Leasing and Indemnification. Buyer acknowledges that Seller may continue
        ---------------------------
its leasing activity through the Approval Date. Seller shall submit any
prospective leases and any modifications, amendments, renewals (which are not
pre-approved per the terms of the lease) or terminations (other than the
pre-described end of term)of existing leases to Buyer for Buyer's reasonable
consent which shall be deemed given if not received in writing by Seller within
three (3) business days of Seller's written request for consent. Any costs of
tenant finish and lease commissions with regard to new leases or renewal of
current leases of the Property entered into prior to Closing (the "New Leases")
shall be paid by Seller. Buyer shall indemnify Seller and Seller shall be fully
released from any and all liability arising as a result of any Future Leasing
Commissions due under any leasing commission agreements affecting the Property.
"Future Leasing Commissions" shall be limited to those commissions resulting

                                      -13-

<PAGE>

from the renewal or extension of any existing lease, the exercise of any options
under an existing lease or the execution of a new lease after the Closing Date,
and shall not include any commissions due and owing on or before the Closing
Date under the terms of any leases or leasing commission agreements in existence
on the Closing Date. Seller shall indemnify Buyer and Buyer shall be fully
released from all liability arising as a result of any commissions due and owing
on or before the
Closing Date under the terms of any leases or leasing commission agreements in
existence on the Closing Date.

     10. Condition of Property. At or before the Approval Date, Buyer will have
         ---------------------
approved the physical and environmental characteristics and condition of the
Property, as well as the economic characteristics of the Property. Buyer hereby
waives any and all defects in the physical, environmental and economic
characteristics and condition of the Property which would be disclosed by such
inspection. Buyer further acknowledges that neither Seller nor any of Seller's
officers or directors, nor Seller's employees, agents, representatives, or any
other person or entity acting on behalf of Seller (hereafter, for the purpose of
this paragraph, such persons and entities are individually and collectively
referred to as the "Seller"), except as otherwise expressly provided in
paragraph 8(a) herein, have made any representations, warranties or agreements
(express or implied) by or on behalf of Seller as to any matters concerning the
Property, the economic results to be obtained or predicted, or the present use
thereof or the suitability for Buyer's intended use of the Property, including,
without limitation, the following: suitability of the topography; the
availability of water rights or utilities; the present and future zoning,
subdivision and any and all other land use matters; the condition of the soil,
subsoil, or groundwater; the purpose(s) to which the Property is suited;
drainage; flooding; access to public roads; or proposed routes of roads or
extensions thereof. Buyer acknowledges and agrees that the Property is to be
purchased, conveyed and accepted by Buyer in its present condition, "as is" and
that no patent or latent defect in the physical or environmental condition of
the Property whether or not known or discovered, shall affect the rights of
either party hereto. Any documents furnished to Buyer by Seller relating to the
Property including, without limitation, rent rolls, service agreements,
management contracts, maps, surveys, studies, pro formas, reports and other
information, including but not limited to the Due Diligence Items, have been
prepared or obtained in the ordinary course of business, have been relied upon
by Seller, and shall be deemed furnished as a courtesy to Buyer but without
warranty from Seller. All work done in connection with preparing the Property
for the uses intended by Buyer including any and all fees, studies, reports,
approvals, plans, surveys, permits, and any expenses whatsoever necessary or
desirable in connection with Buyer's acquiring, developing, using and/or
operating the Property shall be obtained and paid for by, and shall be the sole
responsibility of Buyer. Buyer has investigated and has knowledge of operative
or proposed governmental laws and regulations including land use laws and
regulations to which the Property may be subject and shall acquire the Property
upon the basis of its review and determination of the applicability and effect
of such laws and regulations. Buyer has neither received nor relied upon any
representations concerning such laws and regulations from Seller.

         Except for claims of fraud or willful misrepresentation on the part of
Seller, and except for those representations and warranties expressly set forth
herein, Buyer, on behalf

                                      -14-

<PAGE>

of itself and its employees, agents, successors and assigns attorneys and other
representatives, and each of them, hereby releases Seller from and against any
and all claims, demands, causes of action, obligations, damages and liabilities
of any nature whatsoever, whether alleged under any statute, common law or
otherwise, directly or indirectly, arising out of or related to the condition,
operation or economic performance of the Property.

         By signing in the space provided below in this paragraph 10, Buyer
acknowledges that it has read and understood the provisions of this paragraph
10.

                                              Buyer:  CORNERSTONE REALTY
                                                      INCOME TRUST, INC.,
                                                      a Virginia corporation

                                              By:   /s/ Gus G. Remppies
                                                    ----------------------------
                                              Its:  SVP
                                                    ----------------------------

     11. Possession. Buyer shall have the right of possession on the Closing
         ----------
Date, provided, however, that Seller shall allow authorized representatives of
Buyer reasonable access to the Property for the purposes of satisfying Buyer
with respect to satisfaction of any conditions precedent to the Closing
contained herein.

     12. Tax-Deferred Exchange. Buyer and Seller agree that, at either Buyer's
         ---------------------
or Seller's sole election, this transaction shall be structured as an exchange
of like-kind properties under Section 1031 of the Internal Revenue Code of 1986,
as amended (the "Code"), and the regulations and proposed regulations
thereunder. The parties agree that if either wishes to make such election, it
must do so prior to the Closing Date. If either so elects, the other shall
reasonably cooperate, provided any such exchange is consummated pursuant to an
agreement that is mutually acceptable to Buyer and Seller and which shall be
executed and delivered on or before the Closing Date. The electing party shall
in all events be responsible for all costs and expenses related to the Section
1031 exchange and shall fully indemnify, defend and hold the other harmless from
and against any and all liability, claims, damages, expenses (including
reasonable attorneys' and paralegal fees and reasonable attorneys' and paralegal
fees on appeal), proceedings and causes of action of any kind or nature
whatsoever arising out of, connected with or in any manner related to such 1031
exchange that would not have been incurred by the non-electing party if the
transaction were a purchase for cash. The provisions of the immediately
preceding sentence shall survive closing and the transfer of title to subject
Property to Buyer. Notwithstanding anything to the contrary contained in this
paragraph, any such Section 1031 exchange shall be consummated through the use
of a facilitator or intermediary so that Buyer shall in no event be requested or
required to acquire title to any property other than the Property.

     13. Public Entity. Seller acknowledges that Buyer is a public entity and
         -------------
that it is required to furnish financial statements to the Securities and
Exchange Commission in connection with this acquisition. Seller agrees to permit
Buyer to audit the last twelve (12)

                                      -15-

<PAGE>

months of operation of the Property so that
a report can be generated that is in compliance with accounting S-X of the
Securities and Exchange Commission.

     14.    Miscellaneous.
            -------------

            (a) Notices. Any notice required or permitted to be given under this
                -------
Agreement shall be in writing and shall be deemed to be an adequate and
sufficient notice if given in writing and service is made either by i) personal
delivery, in which case the service shall be deemed received the date of such
personal delivery, ii) nationally recognized overnight air courier service, next
day delivery, prepaid, in which case the notice shall be deemed to have been
received one (1) business day following delivery to such nationally recognized
overnight air courier service or iii) at the time of being sent by facsimile if
delivery thereof is confirmed by sender's receipt of a transmission report,
generated by sender's facsimile machine, which confirms that the facsimile was
successfully transmitted in its entirety and provided the facsimile was
forwarded prior to 5:00 Central, and to the following addresses or facsimile
numbers:

                If to Seller:
                      ------

                ----------------------------------------------------

                Principal Life Insurance Company
                c/o Principal Capital Management, LLC
                801 Grand Avenue
                Des Moines, Iowa  50392-1360
                Attn:  Jeff Menz
                Fax:    515-248-8090
                Phone:  515-235-1604

                ----------------------------------------------------

                With a copy to:

                Principal Capital Management, LLC
                c/o Closing Department
                801 Grand Avenue
                Des Moines, Iowa  50392-1360
                Attn:  Donise Cannaday
                Fax:    515-248-8090
                Phone:  515-248-0425

                ----------------------------------------------------

                If to Buyer:
                      -----

                                      -16-

<PAGE>

<TABLE>
                ---------------------------------------------------- -------------------------------

<S>             <C>                                                  <C>
                Cornerstone Realty Income Trust, Inc.                With a copy to:
                306 East Main Street
                Richmond, Virginia  23219                            Zuckerbrod and Taubenfeld
                Attn:  Gus G. Remppies                               575 Chestnut Street
                Fax:     804-782-9302                                Cedarhurst, NY 11516
                Phone:  804-643-1761                                 Attn:  Harry S. Taubenfeld
                                                                     Fax:   516-347-3490
                                                                     Phone:  516-374-3133

                ---------------------------------------------------- -------------------------------
</TABLE>

                or such other address as either party may from time to time
specify in writing to the other.

            (b) Brokers and Finders. Neither party has had any contact or
                -------------------
dealings regarding the Property, or any communication in connection with the
subject matter of this transaction, through any licensed real estate broker,
entity, agent, commission salesperson, or other person who will claim a right to
compensation or a commission or finder's fee as a procuring cause of the sale
contemplated herein, except for CB Richard Ellis, whose commission shall be paid
by Seller. In the event that any company, firm, broker, agent, commission
salesperson or finder perfects a claim for a commission or finder's fee based
upon any such contract, dealings or communication, the party through whom the
company, firm, broker, agent, commission salesperson or finder makes his claim
shall be responsible for said commission or fee and all costs and expenses
(including reasonable attorneys' fees) incurred by the other party in defending
against the same. No commission shall be paid or become payable unless the
Closing actually occurs. The provisions of this subparagraph (b) shall survive
Closing and any termination, cancellation or rescission of this Agreement.

            (c) Successors and Assigns. This Agreement shall be binding upon,
                ----------------------
and inure to the benefit of, the parties hereto and their respective successors,
heirs, administrators and assigns and may be assigned by Buyer to an affiliated
entity provided that (i) Buyer shall remain jointly and severally liable for the
obligations contained in this Agreement; (ii) Buyer and any assignee, by
accepting assignment of this Agreement, expressly agrees to defend and indemnify
Seller from any litigation arising out of the assignment; (iii) no further
assignment shall occur without the prior written consent of the Seller; (iv)
written notice of the assignment, including the name of the Assignee, is
provided to Seller no fewer than ten (10) business days prior to Closing and (v)
Buyer shall provide to Seller at Closing an Assignment and Assumption of Real
Estate Purchase and Sale Agreement in the form attached hereto as Exhibit F,
executed by both Buyer and Assignee.

            (d) Amendments and Terminations. Except as otherwise provided
                ---------------------------
herein, this Agreement may be amended or modified by, and only by, a written
instrument executed by Seller and Buyer.

                                      -17-

<PAGE>

            (e) Governing Law. This Agreement shall be governed by and construed
                -------------
in accordance with the laws of the state in which the Property is located.

            (f) Merger of Prior Agreements. This Agreement supersedes all prior
                --------------------------
agreements and understandings between the parties hereto relating to the subject
matter hereof.

            (g) Enforcement. In the event either party hereto fails to perform
                -----------
any of its obligations under this Agreement or in the event a dispute arises
concerning the meaning or interpretation of any provision of this Agreement, the
defaulting party or the party not prevailing in such dispute, as the case may
be, shall pay any and all costs and expenses incurred by the other
party in enforcing or establishing its rights hereunder, including, without
limitation, court costs and reasonable attorneys' fees. Buyer and Seller both
acknowledge each has been advised by counsel as to their respective rights,
duties and obligations in this Agreement and have had ample opportunity to
negotiate same. Thus, both Buyer and Seller acknowledge that any ambiguity in
this Agreement should not necessarily be resolved against the drafter of this
Agreement.

            (h) Time of the Essence. Time is of the essence of this Agreement.
                -------------------

            (i) Counterparts. This Agreement may be executed in counterparts,
                ------------
each of which shall be deemed to be an original, but such counterparts when
taken together shall constitute but one Agreement.

            (j) Survivability. Except as otherwise provided herein, the
                -------------
covenants contained in this Agreement shall survive the closing of the purchase
and sale and shall not be deemed merged in the deed, but shall remain in full
force and effect.

            (k) No Recordation. Neither Seller nor Buyer shall record this
                --------------
Agreement or memorandum thereof in or among the land or chattel records of any
jurisdiction.

            (l) Proper Execution. The submission by Seller to Buyer of this
                ----------------
Agreement in unsigned form shall have no binding force and effect, shall not
constitute an option, and shall not confer any rights upon Buyer or impose any
obligations on Seller irrespective of any reliance thereon, change of position
or partial performance until Seller shall have executed this Agreement and the
Deposit shall have been received by the Title Company.

            (m) Computation of Time. The time in which any act is to be done
                -------------------
under this Agreement is computed by excluding the first day, and including the
last day, unless the last day is a holiday or Saturday or Sunday, and then that
day is also excluded. Unless expressly indicated otherwise, (a) all references
to time shall be deemed to refer to Central time, and (b) all time periods shall
expire at 5:00 p.m. Central time.

                                      -18-

<PAGE>

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

                                         Seller:
                                         ------

                                         PRINCIPAL LIFE INSURANCE COMPANY, an
                                         Iowa corporation

                                         By:     PRINCIPAL CAPITAL MANAGEMENT,
                                                 LLC, its authorized signatory

                                                 By:  /s/ L.S. Valentine
                                                      --------------------------
                                                 Its: Counsel
                                                      --------------------------

                                                 By:  /s/ Timothy P. Wilcockson
                                                      --------------------------
                                                 Its: Counsel
                                                      --------------------------

                                         Buyer:
                                         -----

                                         CORNERSTONE REALTY INCOME TRUST, INC.,
                                         a Virginia corporation

                                                 By:  /s/ Gus G. Remppies
                                                      --------------------------
                                                 Its: SVP
                                                      --------------------------

                                         Buyer's Social Security Number or Tax
                                         Identification Number:  54-1589139
                                                                 ---------------

<PAGE>

                                    Exhibit A

                                LEGAL DESCRIPTION
                                -----------------

                                    [OMITTED]

<PAGE>

                                    Exhibit B

            ASSIGNMENT AND ASSUMPTION OF LESSOR'S INTEREST IN LEASES
            --------------------------------------------------------

     This Agreement by and between PRINCIPAL LIFE INSURANCE COMPANY f/k/a
PRINCIPAL MUTUAL LIFE INSURANCE COMPANY, an Iowa corporation (hereinafter called
"Assignor") and ______________________________ (hereinafter called "Assignee")

                              W I T N E S S E T H:

     WHEREAS, Assignor as lessor entered into those certain lease agreements as
more particularly set out in Exhibit "B" attached hereto (herein called the
"Leases"); and

     WHEREAS, Assignor now desires to transfer and assign to Assignee all of
Assignor's interest in and to the lessor's rights, obligations and interest
under the Leases.

     NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration in hand paid to Assignor, the receipt and sufficiency of
which is hereby acknowledged, Assignor does hereby grant, convey, transfer and
assign to Assignee, its successors and assigns, all of Assignor's interest in
the Leases, covering all or portions of the real property described in Exhibit
"A" attached hereto and made a part hereof. Assignor is also hereby assigning
and transferring to Assignee any security deposits held by Assignor under the
Leases. Assignee hereby assumes any and all obligations of Assignor under such
leases and agrees to perform all of the terms, covenants, and conditions of the
Leases on part of Assignor required therein to be performed.

     EXECUTED this ____ day of __________________, 20___.

                                               PRINCIPAL LIFE INSURANCE COMPANY,
                                               an Iowa corporation

                                               By: PRINCIPAL CAPITAL MANAGEMENT,
                                                   LLC, its authorized signatory

                                                   By:__________________________
                                                   Title:_______________________

                                                   By:__________________________
                                                   Title:_______________________

                                               ________________________

                                               By:______________________________
                                               Title:___________________________

<PAGE>

                                    Exhibit C

                            NON-FOREIGN CERTIFICATION
                            -------------------------

        To inform ____________________________________, a ____________________
("Buyer"), that withholding of tax under Section 1445 of the Internal Revenue
Code of 1986, as amended ("Code") will not be required upon the transfer of
certain real property to the Buyer by PRINCIPAL LIFE INSURANCE COMPANY f/k/a
PRINCIPAL MUTUAL LIFE INSURANCE COMPANY, an Iowa corporation ("Seller"), the
undersigned hereby certifies the following on behalf of the Seller:

        1. The Seller is not a foreign corporation, foreign partnership, foreign
trust, or foreign estate (as those terms are defined in the Code and the Income
Tax Regulations promulgated thereunder);

        2. The Seller's U.S. employer identification/social security number is
42-012-7290; and

        3. The Seller's office address is:

           711 High Street
           Des Moines, Iowa 50392

        The Seller understands that this Certification may be disclosed to the
Internal Revenue Service by the Buyer and that any false statement contained
herein could be punished by fine, imprisonment, or both.

        Under penalty of perjury I declare that I have examined this
Certification and to the best of my knowledge and belief it is true, correct and
complete, and I further declare that I have authority to sign this document on
behalf of the Seller.

Dated:  _____________________
                                              PRINCIPAL LIFE INSURANCE COMPANY,
                                              an Iowa corporation

                                              By: PRINCIPAL CAPITAL MANAGEMENT,
                                                  LLC, its authorized signatory

                                                  By:___________________________
                                                  Its:__________________________

                                                  By:___________________________
                                                  Its:__________________________

<PAGE>

                                    Exhibit D

                                NOTICE TO TENANT
                                ----------------

RE:

Dear ______________:

Please be advised that effective __________________, the undersigned has sold
the above-referenced project to ________________. Effective _________________,
all future rental payments should be sent to the following

                           ______________________________
                           ______________________________
                           ______________________________

Any questions regarding maintenance and management of the property should be
addressed to:

                           ______________________________
                           ______________________________
                           ______________________________

                                               PRINCIPAL LIFE INSURANCE COMPANY,
                                               an Iowa corporation

                                               By: PRINCIPAL CAPITAL MANAGEMENT,
                                                   LLC, its authorized signatory

                                                    By:_________________________
                                                    Title:______________________

                                                    By:_________________________
                                                    Title:______________________

           NOTE TO BUYER: PLEASE PROVIDE THE NECESSARY INFORMATION FOR
                  THIS DOCUMENT TO SELLER AS SOON AS AVAILABLE

<PAGE>

                                    Exhibit E

                            CONFIDENTIALITY AGREEMENT
                            -------------------------

Confidential material (the "Information") is being delivered to the undersigned
entity (the "Reviewing Entity") by Principal Life Insurance Company f/k/a
Principal Mutual Life Insurance Company ("Principal") in connection with the
possible sale of certain real property, solely as an accommodation with the
Reviewing Entity's acknowledgment that the Information will be relied upon at
the Reviewing Entity's own risk.

Except as necessary for distribution as specifically authorized herein, the
Reviewing Entity agrees that it shall make no copies of the Information. It may,
however, make notes (such notes shall be deemed to be part of the Information).
The Information will be kept confidential and shall not, without Principal's
prior written consent (which consent shall be granted or denied in Principal's
sole discretion) be disclosed by the Reviewing Entity, or by its agents,
representatives or employees. If such consent is granted, the Information shall
not be disclosed prior to Principal's receipt of an Acknowledgment and
Disclaimer Agreement from the person or entity to whom the Information is being
disclosed. Moreover, the Reviewing Entity agrees to reveal the Information only
to those of its agents, representatives and employees who need to know the
Information and who are informed by the Reviewing Entity of the confidential
nature of the Information. The Reviewing Entity or its agents, representatives
and employees will not volunteer to any person the fact that the Information has
been made available nor will it disclose any of the Information or any summaries
or notes thereof. Notwithstanding the above, the Reviewing Entity may release
the Information to its lender, counsel, co-investors, accountants and
environmental/structural consultants to the extent required to assess the real
property without further consent.

The Reviewing Entity hereby releases and discharges any and all claims it may
have against Principal arising out of the delivery of the Information to the
Reviewing Entity or any inaccuracy of the Information.

The Reviewing Entity agrees that if it, its agents, representatives, or
employees commits a breach of any of the provisions of this Agreement, Principal
shall have the right and remedy to institute proceedings to obtain immediate
injunctive relief for any breach or threatened breach hereof, it being hereby
acknowledged and agreed that any such breach or threatened breach may cause
irreparable injury to Principal and its affiliates and that money damages will
not provide an adequate remedy to Principal and its affiliates.

This stipulation with respect to damages incurred by Principal upon a breach of
this Agreement by the Reviewing Entity shall be limited to use in an action for
injunctive relief. Further, nothing herein shall be construed to limit any other
remedy available to Principal.

This Agreement shall be governed by, and construed and enforced in accordance
with, the laws of the state in which the real property is located.

<PAGE>

This Agreement shall inure to the benefit of, and shall be binding upon, the
parties hereto and their respective successors, assigns, heirs and legal
representatives, including, without limitation, any corporation or other
business organization with which the Reviewing Entity or Principal may merge or
consolidate or to which they may transfer substantially all of their assets or
otherwise enter into an acquisition or reorganization transaction.

Upon receipt of an original signature copy indicating the Reviewing Entity's
consent to the terms of this Agreement, Principal will make the Information
available to the Reviewing Entity at a mutually acceptable time.

Dated this _____ day of __________, 20__.

                                               PRINCIPAL LIFE INSURANCE COMPANY,
                                               an Iowa corporation

                                               By: PRINCIPAL CAPITAL MANAGEMENT,
                                                   LLC, its authorized signatory

                                                   By:__________________________
                                                   Title:_______________________

                                                   By:__________________________
                                                   Title:_______________________

                                               CORNERSTONE REALTY INCOME TRUST,
                                               INC., a _________________________

                                               By:______________________________
                                               Title:___________________________

                                               By:______________________________
                                               Title:___________________________

<PAGE>

                                    Exhibit F

                          ASSIGNMENT AND ASSUMPTION OF
                          ----------------------------
                     REAL ESTATE PURCHASE AND SALE AGREEMENT
                     ---------------------------------------

         THIS ASSIGNMENT AND ASSUMPTION OF REAL ESTATE PURCHASE AND SALE
AGREEMENT (this "Assignment") is made and entered into this ___ day of
__________, _____, by and between _____________________________, a
________________________ ("Assignor"), and ______________________________, a
__________________________, ("Assignee").

         WHEREAS, Assignor entered into that certain Real Estate Purchase and
Sale Agreement dated _____________, _____, [as amended by that certain
__________________________ dated _______________, ______] ("Purchase Agreement")
for that certain real property known as __________________________, with
_________________________________, a ______________________
("Principal"/"Petula"/"Patrician"/"PNLI", etc.), and

         WHEREAS, Assignor wishes to assign to Assignee its rights pursuant to
the Purchase Agreement, relating to the purchase of that certain real property,
with all improvements and appurtenances thereto more particularly described in
the Purchase Agreement.

         NOW, THEREFORE, in consideration of the premises, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor hereby assigns to Assignee all of Assignor's right, title
and interest in and to the Purchase Agreement in order to expressly confer upon
Assignee all of the benefits of a successor, assign or nominee of Assignor under
the Purchase Agreement.

         Nothing in this Assignment shall be deemed to release Assignor from
being directly liable to Principal under the Purchase Agreement.

         By executing this Assignment, Assignee hereby accepts the assignment of
and assumes the obligations set forth in the Purchase Agreement, as aforesaid.

         Assignor will indemnify, defend and hold harmless Principal for any
damages, including attorneys fees and litigation costs from any suit, claim,
demand or proceeding arising out of the Assignment or by a breach of this
Assignment.

         Assignor hereby covenants and warrants to Principal that Assignee is
the only assignee of the Purchase Agreement and Assignee hereby covenants and
warrants to Principal that Assignee (i) is in good standing under the laws of
the State in which the Property is located; (ii) all documents executed by
Assignee which are to be delivered to Seller at Closing are or at the Closing
will be duly authorized, executed, and delivered by Assignee, and are or at the
Closing will be legal, valid, and binding obligations of Assignee, and do not
and at the Closing

<PAGE>

will not violate any provisions of any agreement to which Assignee is a party or
to which it is subject; (iii) Assignee shall furnish all of the funds for the
purchase of the Property (other than funds supplied by institutional lenders
which will hold valid mortgage liens against the Property) and such funds will
not be from sources of funds or properties derived from any unlawful activity;
and (iv) Assignee is a sophisticated investor with substantial experience in
investing in assets of the same type as the Property and has such knowledge and
experience in financial and business matters that Assignee is capable of
evaluating the merits and risks of an investment in the Property.

     This Assignment shall be governed by, and construed in accordance with, the
laws of the State of ___________________. This Assignment may be executed in
counterparts, including facsimile counterparts, each of which shall be deemed an
original and all of which shall constitute one and the same instrument.

     IN WITNESS WHEREOF, Assignor and Assignee have caused this Assignment to be
executed as of the date and year first set forth herein.

                                    ASSIGNOR:
                                    --------

                                    ____________________________, a
                                    ________________

                                    By:  ____________________________

                                    By:  ____________________________

                                    ASSIGNEE:
                                    --------

                                    __________________________, a
                                    __________________

                                    By:   ___________________________

                                    By:   ___________________________

                                    Consented to by:
                                    ---------------

                                    [Principal/Petula/Patrician/PNLI, etc.], a
                                    _________________

                                    By:  ______________________________

                                    By:  ______________________________

<PAGE>

                                    Exhibit G

           ASSIGNMENT OF WARRANTIES, GUARANTIES, AND SERVICE CONTRACTS
           -----------------------------------------------------------

        This Assignment, made as of the ______ day of _________________, by
PRINCIPAL LIFE INSURANCE COMPANY, an Iowa corporation, hereinafter referred to
as "Assignor," to hereinafter referred to _____________________________________,
a _______________________, as "Assignee."

                              W I T N E S S E T H:
                              -------------------

     FOR VALUE RECEIVED, Assignor hereby grants, transfers and assigns to
Assignee all of Assignor's interest in and to any and all warranties and
guaranties, management agreements, maintenance and service agreements, and
equipment leases, if any, to the extent such warranties and guaranties,
agreements and leases are assignable, pertaining to any construction, repairs,
equipment, personal property, intangible property and improvements located on
the real property described in Exhibit "A" attached hereto in _________________
County, ______________________. Assignee hereby assumes any and all obligations
of Assignor under such warranties and guaranties, agreements and leases and
agrees to perform all of the terms, covenants, and conditions on the part of
Assignor required therein to be performed.

     Assignor will cooperate with Assignee to secure performance by any
warrantor for any work which the Assignee believes should be performed by any
warrantor pursuant to such guaranties or warranties.

     This Assignment shall be binding upon and inure to the benefit of the
parties hereto, their successors and assigns.

                                               PRINCIPAL LIFE INSURANCE COMPANY,
                                               an Iowa corporation

                                               By: PRINCIPAL CAPITAL MANAGEMENT,
                                                   LLC, its authorized signatory

                                                    By:_________________________
                                                    Title:______________________

                                                    By:_________________________
                                                    Title:______________________

<PAGE>

                                    Exhibit H

Prepared by:

______________
______________                                 Consideration:  $________________

                            DEED OF BARGAIN AND SALE

       THIS DEED, executed as of the _____ day of ____________________, _______,
between ________________________, a ____________________ (the "Grantor"), and
___________________________, a _____________________ (the "Grantee"), whose
address is __________________________________________, provides:

       THAT for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Grantor hereby grants and conveys to the
Grantee with Special Warranty the real estate described on Exhibit "A" attached
hereto, together with all improvements thereon and appurtenant rights thereunto
belonging (the "Real Estate").

       The Real Estate is conveyed subject to all recorded easements,
conditions, restrictions, agreements and encumbrances that lawfully apply to the
Real Estate or any part thereof.

       TO HAVE AND TO HOLD the Real Estate, together with all rights,
privileges, and advantages thereunto belonging or appertaining to the Grantee,
its successors and assigns, forever.

       IN WITNESS WHEREOF, the Grantor has caused this Deed to be executed by
its duly authorized officer as of the date first above written.

                                            GRANTOR

                                            ________________________________, a
                                            __________________________

Tax I.D. # __________________               By  ______________________________
                                            Its ______________________________

                                            By  ______________________________
                                            Its ______________________________

<PAGE>

                                    Exhibit I

                                  BILL OF SALE
                                  ------------

        PRINCIPAL LIFE INSURANCE COMPANY, an Iowa corporation, whose mailing
address is 711 High Street, Des Moines, Iowa, 50392, hereinafter referred to as
"Grantor," for and in consideration of the sum of Ten Dollars ($10.00) and other
good and valuable consideration to it in hand paid by
___________________________, a ____________________________________, hereinafter
referred to as "Grantee," receipt of which is hereby acknowledged, does hereby
BARGAIN, SELL, GRANT, CONVEY AND TRANSFER and by these presents has BARGAINED,
SOLD, GRANTED, CONVEYED AND TRANSFERRED unto the said Grantee, its successors
and assigns, all tangible personal property owned by Grantor and now existing or
hereafter placed on or installed in the real property described on Exhibit "A"
attached hereto and made a part hereof by reference, and used as a part of or in
connection with the business now or hereafter conducted thereon, said tangible
personal property to include, but not limited to, the right to use any trade
name used in connection with the real property improvements and fixtures, all
machinery, equipment, account or contract rights, and inventory (the "Personal
Property") located on or used in connection with the property described on the
attached Exhibit "A."

     TO HAVE AND TO HOLD the same, unto the said Grantee, its successors and
assigns forever. Grantor does hereby warrant title to the Personal Property, and
covenants and agrees to and with Grantee, its successors and assigns to defend
the Personal Property hereby sold unto Grantee, its successors and assigns,
against all claims by persons who lawfully claim any interest in the Personal
Property by, through or under Grantor, but not otherwise.

        EXECUTED THIS ___________ day of ____________________, 20___.

                                           ____________________________________

                                           By:______________________________
                                           Title:___________________________

<PAGE>

                                    Exhibit J

                               Pending Litigation
                               ------------------

                                      None.

<PAGE>

                                    Exhibit K

                                Personal Property
                                -----------------

                                    [OMITTED]

<PAGE>

                                    Exhibit L

                              Representation Letter
                              ---------------------

                                    [OMITTED]

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