Document:

prsale_agreement.htm

    AGREEMENT
OF PURCHASE AND SALE

     

    OF
LIMITED PARTNERSHIP INTERESTS

     

    By this
Agreement of Purchase  and Sale of Limited Partnership Interests (this
“Agreement”) dated as of
______________ ___, 2009 (the “Effective Date”) AMERICAN COMMUNITY PROPERTIES
TRUST, a
Maryland real estate investment trust (“ACPT”), AMERICAN LAND DEVELOPMENT U.S.,
INC., a ____________corporation (“American Land”), and IGP GROUP
CORP., a __________ corporation (“IGP Group”) (ACPT, American
Land and IGP Group are collectively referred to in this Agreement as “Seller”), agrees to sell and
convey to PARTNERS BUSINESS
EQUITIES, a
______________________, or its permitted assignee (“Purchaser”), who agrees to
purchase and pay for all of Seller’s limited partnership interests in Interstate General Properties Limited
Partnership S.E., a Maryland limited partnership  (“IGP”), and all rights of
Seller associated therewith and/or pertaining thereto.

     

    WHEREAS,
American Land and IGP Group Corp are wholly owned subsidiaries of ACPT;
and

     

    WHEREAS,
IGP Group owns the Class A partnership interests in IGP and American Land owns
the Class B partnership interests in IGP; and

     

    WHEREAS,
as of the date of Closing, Seller, directly or indirectly, will own and control
all of the partnership interests in IGP; and Seller and Purchaser desire for
Seller to assign, or cause to be assigned, to Purchaser such interests in IGP
and to convey to Purchaser certain other management agreements pursuant to the
terms and subject to the conditions herein; and

     

    WHEREAS,
IGP owns the general partner interests in nine (9) limited partnerships (the
“Project Partnerships”)
and limited partner interests in two of the Project Partnerships;
and

     

    WHEREAS,
the Project Partnerships own twelve (12) multifamily residential properties, all
of which are located in the Commonwealth of Puerto Rico (the “Subject Properties”);
and

     

    WHEREAS,
by obtaining ownership of IGP, Purchaser will be:  (i) obtaining
control of the Project Partnerships and the Subject Properties; (ii) acquiring
the Related Leasehold Property (as defined below); and, (iii) obtaining all
other assets of IGP except the Excluded Assets (as defined below) and Ineligible
Liabilities (as defined below).

     

    NOW
THEREFORE, FOR AND IN CONSIDERATION of Ten Dollars and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Seller and Purchaser hereby agree as follows:

     

    1. DEFINITIONS

     

    For
purposes of this Agreement, the following terms have the meanings specified or
referred to in this Section
1:

     

    A.  “Affiliates” -- as to any
Person, any other person owned or controlled by, or under common ownership or
control with, the subject Person.

     

    B. “Encumbrance” -- any charge,
claim, community property interest, condition, equitable interest, lien, option,
pledge, security interest, right of first refusal, or restriction of any kind,
including any restriction on use, voting, transfer, receipt of income, or
exercise of any other attribute of ownership.

     

    C. “Excluded Assets” -- those
assets set forth on Schedule 1(C)
attached hereto together with the leasehold interests (the “Excluded Leases”) identified
on Schedule
1(C-1) attached hereto. .

     

    D. “Existing Indebtedness” -- any
financial obligation of any Project Partnership secured by an Encumbrance on the
Subject Properties (whether one or more) owned by such Project
Partnership.

     

    E. “Governmental Body” --
any:

     

    
      	
              (i)  

            	
              nation,
      state, commonwealth, county, city, town, village, district, or other
      jurisdiction of any nature;

            

    

     

    
      	
              (ii)  

            	
              federal,
      state, commonwealth, local, municipal, foreign, or other
      government;

            

    

     

    
      	
              (iii)  

            	
              governmental
      or quasi-governmental authority of any nature (including any governmental
      agency, branch, department, official, or entity and any court or other
      tribunal);

            

    

     

    
      	
              (iv)  

            	
              multi-national
      organization or body; or

            

    

     

    
      	
              (v)  

            	
              body
      exercising, or entitled to exercise, any administrative, executive,
      judicial, legislative, police, regulatory, or taxing authority or power of
      any nature.

            

    

     

    F. “IGP Assets” -- all of the
assets owned or controlled by IGP including, without limitation, the Partnership
Interests in the Project Partnerships, the Subject Properties, the Related
Leasehold Property, and all other assets of IGP as of the date of Closing
excepting only the Excluded Assets and the Ineligible Liabilities.

     

    G. “Ineligible Liabilities” --.
the stated or contingent liabilities of IGP not related to the IGP Assets
expressly included in the financial statements and records of IGP or otherwise
expressly disclosed in writing by Seller on or prior to the Closing and
specifically including accrued employee salaries, regular vacations, Christmas
bonus payments required by Puerto Rico Legal Requirement, payroll taxes, 401(K)
contributions, and medical insurance for all employees not retained by
Seller.

     

    H. “Knowledge” -- an individual
will be deemed to have “Knowledge” of a
particular fact or other matter if such individual is actually aware of such
fact or other matter. A Person (other than an
individual) will be deemed to have “Knowledge” of a
particular fact or other matter if any individual who is currently serving as a
director, officer, partner, executor, or trustee of such Person (or in any
similar capacity) has, or at any time had, Knowledge of such fact or other
matter.

     

    I. “Legal Requirement” -- any
Governmental Body order, constitution, law, ordinance, principle of common law,
regulation, statute, or treaty.

     

    J. “Management Agreements” -- the
management agreements between each of the Project Partnerships as owner and IGP
as manager together with the management contracts between IGP and certain
non-for-profit entities, all as described on Schedule 1(J)
attached hereto.

     

    K. “Material Adverse Effect as
used in this Agreement, means any change in or effect on the business,
operations or financial condition of the Seller or any of its subsidiaries that
is materially adverse to the Seller and its subsidiaries or affiliates taken as
whole except for (i) any change or effect resulting from general economic,
financial or market conditions or (ii) any change or effect resulting from
conditions or circumstances generally effecting the community development,
development and ownership of rental apartment properties, property management,
and development of commercial rental properties.

     

    L. “Organizational Documents” --
(a) the articles or certificate of incorporation and the bylaws of a
corporation; (b) the partnership agreement and any statement of partnership of a
general partnership; (c) the limited partnership agreement and the certificate
of limited partnership of a limited partnership; (d) the operating agreement and
certificate of formation of a limited liability company; (e) any charter or
similar document adopted or filed in connection with the creation, formation, or
organization of a Person; and (f) any amendment to any of the
foregoing.

     

    M. “Partnership Interests” -- all
of the Class A and Class B partnership interests in IGP, and all other rights of
Seller associated therewith and/or pertaining thereto identified on Schedule 1(L)
attached hereto.

     

    N. “Person” -- any individual,
corporation (including any non-profit corporation), general or limited
partnership, limited liability company, joint venture, estate, trust,
association, organization, labor union, or other entity or Governmental
Body.

     

    O. “Related Leasehold Property”
--  Leasehold improvements and all furniture, fixtures and equipment
owned by IGP and currently located in its central offices and/or in any of the
Project Partnerships’ properties except for Excluded Assets.

     

    P.  “Project Partnership” -- any of
the limited partnerships identified on Schedule 1(O)
attached hereto (collectively referred to in this Agreement as the “Project
Partnerships”).

     

    Q.  “Subject
Properties” -- the properties owned by the Project Partnerships as of the
date of this Agreement described on Schedule 1(P)
attached hereto (individually referred to in this Agreement as a “Subject
Property”).

     

    2. PARTNERSHIP
INTERESTS, MANAGEMENT AGREEMENTS AND EXCLUDED ASSETS AND LIABILITIES, USE OF
“INTERSTATE”

     

    A. Seller
agrees to sell, transfer and assign to Purchaser, and Purchaser agrees to
purchase and have assigned to it, the Partnership Interests together with all of
the interest of Seller in all IGP Assets (the Partnership Interests and the IGP
Assets are collectively referred to as the “Assigned
Interests”).

     

    B. Prior to
the Closing, the Excluded Assets and Ineligible Liabilities will be distributed
by IGP to its partners, American Land and IGP Group, and shall not be a part of
the transactions that are the subject of this Agreement.

     

    C. Purchaser
shall be allowed to continue using the word “Interstate” as part of its
corporate or organizational charter, but shall refrain from using such word,
alone or together with other modifying words, terms, designs, or symbols in
advertising or press releases or in connection with the sale of promotion of its
services or business, or in any other manner not expressly authorized in writing
by Seller, except as otherwise required to comply with any Legal
Requirement.  Seller will retain the IGP Group name and shall be
allowed to continue to trade under that name.

     

    3. PURCHASE
PRICE

     

    A. The
purchase price (“Purchase
Price”) for the Assigned Interests shall be Fourteen Million Three
Hundred Thousand Dollars ($14,300,000).  Payment of the Purchase Price
shall be the responsibility of Purchaser; however, Seller acknowledges that
Purchaser intends to have $300,000 of such Purchase Price paid to Seller by
Partners Services Inc.(“PSI”), a related entity of
Purchaser.

     

    4. DEPOSIT

     

    Purchaser,
immediately upon execution by Seller of this Agreement, shall deposit into an
escrow account Fifty Thousand Dollars ($50,000) (the “Deposit”) for the acquisition
of the Assigned Interests, which will become nonrefundable (except if the
Closing does not occur due to any breach of this Agreement by Seller) by the end
of the Due Diligence Period as defined in Section 5 hereof.  The
Deposit shall be maintained in an interest-bearing account with an FDIC-insured
commercial bank in Puerto Rico.  Interest shall accrue to the benefit
of Purchaser and the full amount of the Deposit, plus interest thereon, shall be
applied to the payment of the Purchase Price at Closing.  If Purchaser
wrongfully fails to close in accordance with the terms of this Agreement, the
Deposit (less interest thereon, which shall be returned to Purchaser) shall be
delivered by the bank to Seller as full and liquidated damages.  If
Seller wrongfully fails to close in accordance with the terms of this Agreement,
the entire Deposit, including interest thereon, shall be returned by the bank to
Purchaser and Seller shall reimburse to Purchaser, upon demand, all legal and
professional services expenses incurred in connection with this purchase
transaction.

     

    5. DUE
DILIGENCE

     

    A. The due
diligence period (“Due
Diligence Period”) shall be for a period of sixty days (60) commencing on
the date of the execution of this Agreement by both parties.  If the
results of this due diligence investigation are unsatisfactory to Purchaser, in
its sole determination, then Purchaser will have the option to terminate this
Agreement on or before the expiration of the Due Diligence Period and the
Deposit shall be returned to Purchaser.

     

    B. During
the Due Diligence Period, Purchaser, its attorneys and other representatives,
shall have the right to inspect any and all relevant documents and information
related to the Partnership Interests, IGP and the IGP Assets, including but not
limited to: (i) all of IGP’s financial statements, contracts, books, records and
other documents, including but not limited to all such documents maintained by
or for IGP with respect to any of the Project Partnerships’ properties and other
properties managed under the Management Agreements and the operation thereof;
(ii) all of the HUD reports on the management and operation of such properties;
and (iii) all other documents in the possession of Seller relating to IGP and/or
the Project Partnerships, the Subject Properties and the Management Agreements
properties (excluding, however, any internal organizational or financial
documents of Seller not related to the assets, liabilities or contracts of IGP,
the Project Partnerships and/or Management Agreements) at such place or places
as such books, records and documents are maintained.

     

    C. Purchaser,
at its cost, shall also have the right to make physical inspections of all the
properties managed by IGP pursuant to Management Agreements.

     

    D. By
written notice delivered to Seller at least five (5) business days prior to the
expiration of the Due Diligence Period, Purchaser shall have the one-time right
to extend the Due Diligence Period for an additional period of fifteen (15)
days, should it have not been able to complete the due diligence
process.

     

    6. OTHER
TRANSACTION TERMS AND CONDITIONS

     

    A. During
the Due Diligence Period, Seller and Purchaser shall enter into mutually
satisfactory arrangements for the payment of the amounts owed by Valle del Sol
Associates Limited Partnership ($928,045) and Turabo Limited Dividend
Partnership ($46,000) to Seller, which are payable only by proceeds from (i)
mortgage refinancing, (ii) partial condemnation, (iii) sale of easements or
similar interest, or (iv) proceeds from the sale of any Subject
Property.

     

    B. Except
for the distributions to be made to Seller and the limited partners of the
Project Partnerships regarding the 2008 operations (it being understood that
such distributions shall be reviewed by Purchaser during the Due Diligence
Period), no additional distribution of dividends or partnership profits or
earned revenues shall be made by the Project Partnerships to American Land, IGP
Group and/or ACPTr.  It is understood by both parties that the
Monserrate Associates, LP Subject Property is to be refinanced on or before
April 30, 2009, when its loan amount matures.  Both parties agree that
all refinancing proceeds to be collected by IGP as General Partner and Limited
Partner, shall be distributable to Purchaser only and that Seller shall not be
entitled to any of such proceeds.

     

    C. Seller
will be responsible for all Ineligible Liabilities, the complete description of
which shall be agreed upon in writing by the parties during the Due Diligence
Period.

     

    D. Seller
shall receive all uncollected management fees due pursuant to the Management
Agreements until the Closing Date.  Seller also shall receive the
accrued incentive fee earned pursuant to the Management Agreements until the
Closing Date.  Such payment or payments will be made, according to the
partnership agreements of the Project Partnerships and the Management Agreement
for the Subject Properties, at the time the Project Partnerships make the cash
distributions to the partners on March 31, 2010.

     

    E. Purchaser
shall receive the refinancing fee related to Monserrate Associates, LP from the
refinancing proceeds of the realty.

     

    F. Purchaser
shall cause PSI to assume the existing lease of IGP with Escorial Office
Building I until the expiration of the current term of such
lease.  The form of such lease assumption shall be agreed upon during
the Due Diligence Period.

     

    7. APPROVALS
AND CONSENTS

     

    A. During
the four (4) month period following the Effective Date (the “Required Approval
Delivery Period”), Seller shall cooperate with Purchaser in providing all
necessary notices and take all appropriate actions to obtain the required
consents or approvals from (i) HUD, including the “2530” clearances, (ii)
existing lenders on the Subject Properties, (iii) applicable Governmental
Bodies, and (iv) limited partners in the Project Partnerships (collectively, the
“Required
Approvals”).  Purchaser and Seller agree that should the
lenders charge a transfer fee, a fee of 1% of the then outstanding principal
balance of each loan shall be acceptable and Seller and Purchaser shall share
equally in the cost of such transfer fees.  However, in the event a
lender requires a transfer fee in excess of 1%, Seller and Purchaser shall
attempt to reach an agreement as to the allocation of the amount in excess of 1%
and if no agreement is reached within a ten (10) day period, Purchaser may
terminate this Agreement, and Purchaser shall have full refund of the
Deposit.  By written notice delivered to Seller at least five (5)
business days prior to the expiration of the Required Approval Delivery Period,
Purchaser may extend the Required Approval Delivery Period for a period not to
exceed an additional thirty (30) days if such required approvals have been
requested from the appropriate parties but not yet obtained.  All
Required Approvals are set forth on Schedule 7(A)
attached hereto.

     

    8. REPRESENTATIONS
AND WARRANTIES REGARDING AUTHORITY

     

    A. ACPT’s
Authority.  ACPT hereby represents and warrants to Purchaser as
of the date of this Agreement and as of the Closing Date that this Agreement has
been duly authorized, executed and delivered by ACPT and all consents required
under ACPT’s Organizational Documents have been obtained.  All
documents that are to be executed by ACPT and delivered to Purchaser on the
Closing Date have been, or on the Closing Date will be, duly executed,
authorized and delivered by ACPT.  This Agreement and all such
documents are, and on the Closing Date will be, legal, valid and binding
obligations of ACPT, enforceable in accordance with their terms and do not, and,
at the time of the Closing Date will not, violate any provisions of any
agreement or judicial or administrative order to which ACPT is a party or to
which ACPT is subject.

     

    B. American Land’s
Authority.  American Land hereby represents and warrants to
Purchaser as of the date of this Agreement and as of the Closing Date that this
Agreement has been duly authorized, executed and delivered by American Land and
all consents required under American Land’s Organizational Documents have been
obtained.  All documents that are to be executed by American Land and
delivered to Purchaser on the Closing Date have been, or on the Closing Date
will be, duly executed, authorized and delivered by American
Land.  This Agreement and all such documents are, and on the Closing
Date will be, legal, valid and binding obligations of American Land, enforceable
in accordance with their terms and do not, and, at the time of the Closing Date
will not, violate any provisions of any agreement or judicial or administrative
order to which American Land is a party or to which American Land is
subject.

     

    C. IGP Group’s
Authority.  IGP Group hereby represents and warrants to
Purchaser as of the date of this Agreement and as of the Closing Date that this
Agreement has been duly authorized, executed and delivered by IGP Group and all
consents required under IGP Group’s Organizational Documents have been
obtained.  All documents that are to be executed by IGP Group and
delivered to Purchaser on the Closing Date have been, or on the Closing Date
will be, duly executed, authorized and delivered by IGP Group.  This
Agreement and all such documents are, and on the Closing Date will be, legal,
valid and binding obligations of IGP Group, enforceable in accordance with their
terms and do not, and, at the time of the Closing Date will not, violate any
provisions of any agreement or judicial or administrative order to which IGP
Group is a party or to which IGP Group is subject.

     

    D. Purchaser’s
Authority.  Purchaser hereby represents and warrants to Seller
as of the date of this Agreement and as of the Closing Date that this Agreement
has been duly authorized, executed and delivered by Purchaser and all consents
required under Purchaser’s Organizational Documents or by law have been
obtained.  All documents that are to be executed by Purchaser and
delivered to Seller on the Closing Date have been, or on the Closing Date will
be, duly executed, authorized and delivered by Purchaser.  This
Agreement and all such documents are, and on the Closing Date will be, legal,
valid and binding obligations of Purchaser, enforceable in accordance with their
terms and do not, and, at the time of the Closing Date will not, violate any
provisions of any agreement or judicial or administrative order to which
Purchaser is a party or to which Purchaser is subject.

     

    9. REPRESENTATIONS
AND WARRANTIES.

     

    A. Organization and Ownership
of Project Partnerships.

     

    
      	
              (i)  

            	
              Alturas del Senorial
      Associates Limited Partnership (“Alturas
      del Senorial”)  Seller
      hereby represents and warrants that Alturas del Senorial is a limited
      partnership validly existing and in good standing under the laws of the
      Commonwealth of Puerto Rico with full power and authority and legal right
      to enter into and perform its obligations under this Agreement, the
      Closing Documents to which it is a party and to carry on its business in
      the manner and in the locations in which such business has been and is now
      being conducted by it.  Schedule 9(A)
      lists all of the direct and indirect owners of partnership interests in
      Alturas del Senorial del Senorial and states the nature of the direct or
      indirect ownership interest of each.  The Organizational
      Documents of Alturas del Senorial submitted to Purchaser are true,
      complete and accurate and have not been terminated, modified or amended
      and are in full force and effect.  None of IGP’s interests in
      Alturas del Senorial is subject to liens or
  encumbrances.

            

    

     

    
      	
              (ii)  

            	
              Bayamon Garden
      Associates Limited Partnership (“Bayamon”)  Seller
      hereby represents and warrants that Bayamon is a limited partnership
      validly existing and in good standing under the laws of the Commonwealth
      of Puerto Rico with full power and authority and legal right to enter into
      and perform its obligations under this Agreement, the Closing Documents to
      which it is a party and to carry on its business in the manner and in the
      locations in which such business has been and is now being conducted by
      it.  Schedule 9(A)
      lists all of the direct and indirect owners of partnership interests in
      Bayamon and states the nature of the direct or indirect ownership interest
      of each.  The Organizational Documents of Bayamon submitted to
      Purchaser are true, complete and accurate and have not been terminated,
      modified or amended and are in full force and effect.  None of
      IGP’s interests in Bayamon is subject to liens or
      encumbrances.

            

    

     

    
      	
              (iii)  

            	
              Carolina Associates
      Limited Partnership (“Carolina”)  Seller
      hereby represents and warrants that Carolina is a limited partnership
      validly existing and in good standing under the laws of the Commonwealth
      of Puerto Rico with full power and authority and legal right to enter into
      and perform its obligations under this Agreement, the Closing Documents to
      which it is a party and to carry on its business in the manner and in the
      locations in which such business has been and is now being conducted by
      it.  Schedule 9(A)
      lists all of the direct and indirect owners of partnership interests in
      Carolina and states the nature of the direct or indirect ownership
      interest of each.  The Organizational Documents of Carolina
      submitted to Purchaser are true, complete and accurate and have not been
      terminated, modified or amended and are in full force and
      effect.  None of IGP’s interests in Carolina is subject to liens
      or encumbrances.

            

    

     

    
      	
              (iv)  

            	
              Colinas de San Juan
      Associates Limited Partnership (“Colinas
      de San Juan”)  Seller
      hereby represents and warrants that Colinas de San Juan is a limited
      partnership validly existing and in good standing under the laws of the
      Commonwealth of Puerto Rico with full power and authority and legal right
      to enter into and perform its obligations under this Agreement, the
      Closing Documents to which it is a party and to carry on its business in
      the manner and in the locations in which such business has been and is now
      being conducted by it.  Schedule 9(A)
      lists all of the direct and indirect owners of partnership interests in
      Colinas de San Juan and states the nature of the direct or indirect
      ownership interest of each.  The Organizational Documents of
      Colinas de San Juan submitted to Purchaser are true, complete and accurate
      and have not been terminated, modified or amended and are in full force
      and effect.  None of IGP’s interests in Colinas de San Juan is
      subject to liens or encumbrances.

            

    

     

    
      	
              (v)  

            	
              Monserrate Associates
      Limited Partnership (“Monserrate”)  Seller
      hereby represents and warrants that Monserrate is a limited partnership
      validly existing and in good standing under the laws of the Commonwealth
      of Puerto Rico with full power and authority and legal right to enter into
      and perform its obligations under this Agreement, the Closing Documents to
      which it is a party and to carry on its business in the manner and in the
      locations in which such business has been and is now being conducted by
      it.  Schedule 9(A)
      lists all of the direct and indirect owners of partnership interests in
      Monserrate and states the nature of the direct or indirect ownership
      interest of each.  The Organizational Documents of Monserrate
      submitted to Purchaser are true, complete and accurate and have not been
      terminated, modified or amended and are in full force and
      effect.  None of IGP’s interests in Monserrate is subject to
      liens or encumbrances.

            

    

     

    
      	
              (vi)  

            	
              San Anton Associates
      S.E. (“San
      Anton”)  Seller
      hereby represents and warrants that San Anton is a limited partnership
      validly existing and in good standing under the laws of the Commonwealth
      of Puerto Rico with full power and authority and legal right to enter into
      and perform its obligations under this Agreement, the Closing Documents to
      which it is a party and to carry on its business in the manner and in the
      locations in which such business has been and is now being conducted by
      it.  Schedule 9(A)
      lists all of the direct and indirect owners of partnership interests in
      San Anton and states the nature of the direct or indirect ownership
      interest of each.  The Organizational Documents of San Anton
      submitted to Purchaser are true, complete and accurate and have not been
      terminated, modified or amended and are in full force and
      effect.  None of IGP’s interests in San Anton is subject to
      liens or encumbrances.

            

    

     

    
      	
              (vii)  

            	
              Jardines de Caparra
      Associates Limited Partnership (“Jardines
      de Caparra”)  Seller
      hereby represents and warrants that Jardines de Caparra is a limited
      partnership validly existing and in good standing under the laws of the
      Commonwealth of Puerto Rico  with full power and authority and
      legal right to enter into and perform its obligations under this
      Agreement, the Closing Documents to which it is a party and to carry on
      its business in the manner and in the locations in which such business has
      been and is now being conducted by it.  Schedule 9(A)
      lists all of the direct and indirect owners of partnership interests in
      Jardines de Caparra and states the nature of the direct or indirect
      ownership interest of each.  The Organizational Documents of
      Jardines de Caparra submitted to Purchaser are true, complete and accurate
      and have not been terminated, modified or amended and are in full force
      and effect.  None of IGP’s interests in Jardines de Caparra is
      subject to liens or encumbrances.

            

    

     

    
      	
              (viii)  

            	
              Turabo Limited
      Dividend Partnership (“Turabo”)  Seller
      hereby represents and warrants that Turabo is a limited partnership
      validly existing and in good standing under the laws of the Commonwealth
      of Puerto Rico with full power and authority and legal right to enter into
      and perform its obligations under this Agreement, the Closing Documents to
      which it is a party and to carry on its business in the manner and in the
      locations in which such business has been and is now being conducted by
      it.  Schedule 9(A)
      lists all of the direct and indirect owners of partnership interests in
      Turabo and states the nature of the direct or indirect ownership interest
      of each.  The Organizational Documents of Turabo submitted to
      Purchaser are true, complete and accurate and have not been terminated,
      modified or amended and are in full force and effect.  None of
      IGP’s interests in Turabo is subject to liens or
    encumbrances.

            

    

     

    
      	
              (ix)  

            	
              Valle del Sol
      Associates Limited Partnership (“Valle
      del Sol”)  Seller
      hereby represents and warrants that Valle del Sol is a limited partnership
      validly existing and in good standing under the laws of the Commonwealth
      of Puerto Rico with full power and authority and legal right to enter into
      and perform its obligations under this Agreement, the Closing Documents to
      which it is a party and to carry on its business in the manner and in the
      locations in which such business has been and is now being conducted by
      it.  Schedule 9(A)
      lists all of the direct and indirect owners of partnership interests in
      Valle del Sol and states the nature of the direct or indirect ownership
      interest of each.  The Organizational Documents of Valle del Sol
      submitted to Purchaser are true, complete and accurate and have not been
      terminated, modified or amended and are in full force and
      effect.  None of IGP’s interests in Valle del Sol is subject to
      liens or encumbrances.

            

    

     

    B. Consents and Approvals for
Project Partnerships.

     

    
      	
              (i)  

            	
              Alturas del Senorial
      Associates Limited Partnership Seller, except for the Required
      Approvals identified in Schedule 7(A)
      attached hereto, hereby represents and warrants that there are no
      consents, approvals or waivers of any other third party required for the
      consummation of the transactions contemplated by this
      Agreement.  This Agreement and the Closing Documents do not
      violate or conflict with and will not constitute a default under any
      provision of any agreement, organizational document, law or judicial or
      other governmental order to which Alturas del Senorial is a party or to
      which Alturas del Senorial or its Property is subject, will not result in
      the imposition of any lien or charge upon any asset of Alturas del
      Senorial and will not result in the acceleration of any obligation under
      the terms of any agreement or document binding upon Alturas del
      Senorial.

            

    

     

    
      	
              (ii)  

            	
              Bayamon Garden
      Associates Limited Partnership Seller, except for the Required
      Approvals identified in Schedule 7(A)
      attached hereto, hereby represents and warrants that there are no
      consents, approvals or waivers of any other third party required for the
      consummation of the transactions contemplated by this
      Agreement.  This Agreement and the Closing Documents do not
      violate or conflict with and will not constitute a default under any
      provision of any agreement, organizational document, law or judicial or
      other governmental order to which Bayamon is a party or to which Bayamon
      or its Property is subject, will not result in the imposition of any lien
      or charge upon any asset of Bayamon and will not result in the
      acceleration of any obligation under the terms of any agreement or
      document binding upon Bayamon.

            

    

     

    
      	
              (iii)  

            	
              Carolina Associates
      Limited Partnership Seller, except for the Required Approvals
      identified in Schedule 7(A)
      attached hereto, hereby represents and warrants that there are no
      consents, approvals or waivers of any other third party required for the
      consummation of the transactions contemplated by this
      Agreement.  This Agreement and the Closing Documents do not
      violate or conflict with and will not constitute a default under any
      provision of any agreement, organizational document, law or judicial or
      other governmental order to which Carolina is a party or to which Carolina
      or its Property is subject, will not result in the imposition of any lien
      or charge upon any asset of Carolina and will not result in the
      acceleration of any obligation under the terms of any agreement or
      document binding upon Carolina.

            

    

     

    
      	
              (iv)  

            	
              Colinas de San Juan
      Assoicates Limited Partnership Seller, except for the Required
      Approvals identified in Schedule 7(A)
      attached hereto, hereby represents and warrants that there are no
      consents, approvals or waivers of any other third party required for the
      consummation of the transactions contemplated by this
      Agreement.  This Agreement and the Closing Documents do not
      violate or conflict with and will not constitute a default under any
      provision of any agreement, organizational document, law or judicial or
      other governmental order to which Colinas de San Juan is a party or to
      which Colinas de San Juan or its Property is subject, will not result in
      the imposition of any lien or charge upon any asset of Colinas de San Juan
      and will not result in the acceleration of any obligation under the terms
      of any agreement or document binding upon Colinas de San
    Juan.

            

    

     

    
      	
              (v)  

            	
              Monserrate Associates
      Limited Partnership Seller, except for the Required Approvals
      identified in Schedule 7(A)
      attached hereto, hereby represents and warrants that there are no
      consents, approvals or waivers of any other third party required for the
      consummation of the transactions contemplated by this
      Agreement.  This Agreement and the Closing Documents do not
      violate or conflict with and will not constitute a default under any
      provision of any agreement, organizational document, law or judicial or
      other governmental order to which Monserrate is a party or to which
      Monserrate or its Property is subject, will not result in the imposition
      of any lien or charge upon any asset of Monserrate and will not result in
      the acceleration of any obligation under the terms of any agreement or
      document binding upon Monserrate.

            

    

     

    
      	
              (vi)  

            	
              San Anton Associates
      S.E. Limited Partnership Seller, except for the Required Approvals
      identified in Schedule 7(A)
      attached hereto, hereby represents and warrants that there are no
      consents, approvals or waivers of any other third party required for the
      consummation of the transactions contemplated by this
      Agreement.  This Agreement and the Closing Documents do not
      violate or conflict with and will not constitute a default under any
      provision of any agreement, organizational document, law or judicial or
      other governmental order to which San Anton is a party or to which San
      Anton or its Property is subject, will not result in the imposition of any
      lien or charge upon any asset of San Anton and will not result in the
      acceleration of any obligation under the terms of any agreement or
      document binding upon San Anton.

            

    

     

    
      	
              (vii)  

            	
              Jardines de Caparra
      Associates Limited Partnership Seller, except for the Required
      Approvals identified in Schedule 7(A)
      attached hereto, hereby represents and warrants that there are no
      consents, approvals or waivers of any other third party required for the
      consummation of the transactions contemplated by this
      Agreement.  This Agreement and the Closing Documents do not
      violate or conflict with and will not constitute a default under any
      provision of any agreement, organizational document, law or judicial or
      other governmental order to which Jardines de Caparra is a party or to
      which Jardines de Caparra or its Property is subject, will not result in
      the imposition of any lien or charge upon any asset of Jardines de Caparra
      and will not result in the acceleration of any obligation under the terms
      of any agreement or document binding upon Jardines de
    Caparra.

            

    

     

    
      	
              (viii)  

            	
              Turabo Limited
      Divident Partnership Seller, except for the Required Approvals
      identified in Schedule 7(A)
      attached hereto, hereby represents and warrants that there are no
      consents, approvals or waivers of any other third party required for the
      consummation of the transactions contemplated by this
      Agreement.  This Agreement and the Closing Documents do not
      violate or conflict with and will not constitute a default under any
      provision of any agreement, organizational document, law or judicial or
      other governmental order to which Turabo is a party or to which Turabo or
      its Property is subject, will not result in the imposition of any lien or
      charge upon any asset of Turabo and will not result in the acceleration of
      any obligation under the terms of any agreement or document binding upon
      Turabo.

            

    

     

    
      	
              (ix)  

            	
              Valle del Sol
      Associates Limited Partnership Seller, except for the Required
      Approvals identified in Schedule 7(A)
      attached hereto, hereby represents and warrants that there are no
      consents, approvals or waivers of any other third party required for the
      consummation of the transactions contemplated by this
      Agreement.  This Agreement and the Closing Documents do not
      violate or conflict with and will not constitute a default under any
      provision of any agreement, organizational document, law or judicial or
      other governmental order to which Valle del Sol is a party or to which
      Valle del Sol or its Property is subject, will not result in the
      imposition of any lien or charge upon any asset of Valle del Sol and will
      not result in the acceleration of any obligation under the terms of any
      agreement or document binding upon Valle del
  Sol.

            

    

     

    C. Representations and
Warranties regarding IGP

     

    
      	
              (i)  

            	
              Litigation.  Seller
      hereby represents and warrants, to the best of its knowledge, that except
      as described in Schedule
      9(C)(i) attached hereto, there are no legal actions, suits or
      proceedings (including arbitration proceedings) at law or in equity before
      or by any federal, state, municipal court or other governmental
      department, commission, board, bureau, agency or instrumentality, which
      are pending or threatened in writing against IGP that could have a
      material adverse effect on IGP.

            

    

     

    
      	
              (ii)  

            	
              Financials.  Seller
      hereby represents and warrants that the financial statements of IGP listed
      on Schedule
      9(C)(ii) attached hereto are true, accurate and complete in all
      material respects and there has been no material adverse change in such
      information since the date of the most recent financials.  Each
      such financial statement fairly represents the financial condition of the
      subject thereof in all material respects and, if an audited financial
      statement, has been prepared in accordance with generally accepted
      accounting practices.

            

    

     

    
      	
              (iii)  

            	
              Anti-Terrorism.  Seller
      hereby represents and warrants that neither ACPT, American Land, IGP
      Group, IGP, nor any underlying beneficial owner has engaged in any
      dealings or transactions, directly or indirectly, (i) in contravention of
      any United States, international or other money laundering regulations or
      conventions, including, without limitation, the United States Bank Secrecy
      Act, the United States Money Laundering Control Act of 1986, the United
      States International Money Laundering Abatement and Anti-Terrorist
      Financing Act of 2001, Trading with the Enemy Act (50 U.S.C. §1 et seq.,
      as amended), or any foreign asset control regulations of the United States
      Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any
      enabling legislation or executive order relating thereto, or (ii) in
      contravention of Executive Order No. 13,244,66 Fed. Reg. 49,079 (2001)
      issued by the President of the United States (Executive Order Blocking
      Property and Prohibiting Transactions with Persons Who Commit, Threaten to
      Commit, or Support Terrorism), as may be amended or supplemented from time
      to time (“Anti-Terrorism
      Order”) or on behalf of terrorists or terrorist organizations,
      including those persons or entities that are included on any relevant
      lists maintained by the United Nations, North Atlantic Treaty
      Organization, Organization of Economic Cooperation and Development,
      Financial Action Task Force, U.S. Office of Foreign Assets Control, U.S.
      Securities & Exchange Commission, U.S. Federal Bureau of
      Investigation, U.S. Central Intelligence Agency, U.S. Internal Revenue
      Service, or any country or organization, all as may be amended from time
      to time, nor are any of them or their underlying beneficial owners a
      person described in Section 1 of the Anti-Terrorism Order and none of
      them, nor any of their underlying beneficial owners have engaged in any
      dealings or transactions, or otherwise been associated with any such
      person.

            

    

     

    
      	
              (iv)  

            	
              Undisclosed
      Liabilities.  To the best of its knowledge, Seller hereby
      represents and warrants that IGP has no material liabilities or
      obligations of any nature whether accrued, absolute, contingent or
      otherwise other than as disclosed in this
  Agreement.

            

    

     

    
      	
              (v)  

            	
              Taxes.  Seller
      hereby represents and warrants that all taxes, governmental levies or
      assessments which are owed by IGP have been paid to the extent due and
      payable.  All allocations and distributions and tax reporting by
      IGP prior to the date hereof have been done or made in accordance with the
      terms and provisions of the Organizational Documents of IGP and the
      Internal Revenue Code.

            

    

     

    10. PROPERTY
REPRESENTATIONS AND WARRANTIES.

     

    Seller
hereby represents and warrants to Purchaser as of the date of this Agreement as
follows:

     

    A. Condemnation and
Actions.  Except as may be disclosed in Schedule 10(A)
hereto, there are no pending condemnation, zoning, environmental or land use
regulation proceedings against or related to any Subject Property or any portion
thereof, nor have they received any written notice of any being
contemplated.

     

    B. Compliance with Title
Encumbrances.  Except as may be disclosed in Schedule 10(B)
hereto, there are no material defaults by any Project Partnership under any of
the covenants, easements or restrictions encumbering any Subject Property or any
portion thereof.

     

    C. Violation
Notices.  Except as set forth in Schedule 10(C)
attached hereto, no party hereto has received any notice from any governmental
authority of any failure of any Subject Property to comply with any zoning,
building, environmental, ecology, health and public safety, subdivision, land
sales or similar law, rule, ordinance or regulation, pertaining to any Subject
Property or any portion thereof.  No consent or approval is required
from any Governmental Body for any Project Partnership to own or operate or
develop any Subject Property, as the same is currently operated, developed and
used, except those which have been obtained, all of which are in full force and
effect.  No governmental, fire, life safety or other inspection is
required in connection with the transactions contemplated by the
Agreement.  No new certificates of occupancy are required to be issued
in connection with the transfer of any Subject Property to
Purchaser.

     

    D. Permits and
Licenses.  To the best of Seller’s knowledge, the existing
licenses, permits or other approvals required for the construction, ownership,
use, development and operation of the existing improvements of any Subject
Property have each been validly issued by the appropriate authority and are in
full force and effect and constitute all of the licenses, permits and approvals
required for the ownership, operation, development and sale of any Subject
Property as contemplated.

     

    E. Brokers.  Except
as set forth on Schedule 10(E), as of
the date of this Agreement, there are no written agreements with any real estate
broker, leasing agent or other party (including, without limitation, the current
manager of any Subject Property), that entitles or will entitle such real estate
broker, agent or other party to any leasing, sales or other brokerage commission
or payment or finder’s fee for which Seller or Purchaser is responsible related
to the sale or leasing of any portion of any Subject Property.

     

    F. Environmental
Compliance.  To the best of Seller’s knowledge, no Project
Partnership has generated, stored or disposed of any oil, petroleum products or
“Hazardous Materials”, as defined under Puerto Rico or United States laws or
regulations (collectively, “Hazardous Materials”) at any
Subject Property or the improvements located thereon and, except as disclosed
in. reports listed on Schedule 10(F),
Seller has no knowledge of any previous or present generation, storage, disposal
or existence thereof.  A list of all environmental reports of which
Seller has knowledge is set forth in Schedule 10(F)
attached hereto.  Except as may be disclosed in those environmental
reports listed on Schedule 10(F), (i)
no Project Partnership has entered into any consent decree or administrative
order for any alleged violation of laws relating to so-called Hazardous
Materials; (ii) no Project Partnership has received any written request for
information or a demand letter from a citizen with respect to a violation of
laws pertaining to Hazardous Materials; and (iii) to the knowledge and belief of
Seller, no contractor or other party has generated, stored or disposed of any
Hazardous Materials at any Subject Property or transported any Hazardous
Materials off site from any Subject Property except in accordance with
applicable law.

     

    G. Special
Assessments.  To the best of their knowledge, there are no
unpaid special assessments filed, pending or proposed against any Subject
Property or any portion thereof including, without limitation, any street
improvement or special district assessments.

     

    H. Title.  Other
than this Agreement, there are no unrecorded purchase agreements, option
agreements, rights of first refusal, conditional sales contracts, or other title
retention agreements which affect any Subject Property.

     

    I. Zoning and
Use.  Seller has not received written notice from any
governmental authority that any Subject Property is not in compliance with or
violates applicable environmental building and zoning laws, rules or regulations
or governmental rules or regulations.

     

    J. No
Litigation.  Except as specifically disclosed on Schedule 10(J), there
are no pending or, to the best of Seller’s knowledge, threatened, claims,
allegations or lawsuits of any kind, whether for personal injury, property
damage, landlord-tenant disputes, property taxes or otherwise, that could
materially and adversely affect the operation or value of any Subject Property,
nor to the best of Seller’s knowledge, is there any governmental investigation
of any type or nature pending or threatened against or relating to any Subject
Property or the transactions contemplated hereby.

     

    K. Insurance
Indemnifications.  Seller has not received notices by any
insurance company which has issued a policy with respect to any portion of any
Subject Property, or by any board of fire underwriters, or from any governmental
authority, of zoning, building, fire or health code violations in respect to any
Subject Property.

     

    L. Rent
Roll.  The Rent Rolls delivered to Purchaser contain a complete
and correct list of all Leases.  Except as set forth in the Rent
Rolls, each Lease is valid and existing and in full force and effect, has not
been amended, modified or supplemented, and the tenant, licensee or occupant
thereunder is in actual possession.  Except as set forth in the Rent
Rolls, there are no defaults under any of the Leases, nor have events occurred
which with notice or the passage of time, or both, would constitute a default
thereunder.  Seller has not made any previous assignment, transfer or
other disposition of all or any part of its interest in any of the
Leases.

     

    M. Rental
Concessions.  Except as set forth on the Rent Rolls, no tenant,
under any of the Leases is, or as of the Closing will be, entitled to any free
rent, concessions, allowances, rebates or refunds and no tenant under any of the
Leases has, or as of the Closing will have, prepaid any rent or other charges
for more than one month in advance.

     

    N. Management
Contracts.  The Management Contracts are in full force and
effect, and there are no written or oral agreements or understandings relating
to the management of any Subject Property other than the Management
Contracts.  The Management Contracts are all in full force and effect
and there are no uncured defaults and there exists no condition that, with
notice, the passage of time, or both, would constitute an event of default by
any party under the Management Contracts.

     

    O. Housing Assistance Payments
Contracts/Regulatory Agreements.  Other than the Housing
Assistance Payments Contracts (“HAP”) and Regulatory
Agreements affecting any Subject Property, and there are no written or oral
agreements or understandings relating thereto.  The HAP and Regulatory
Agreements are all in full force and effect, there are no uncured defaults
thereunder, and there exists no condition that with notice, the passage of time,
or both, would constitute an event of default by any party under the HAP or the
Regulatory Agreements.

     

    P. Existing
Indebtedness.  There are no written or oral agreements,
understandings or commitments relating to the Existing Indebtedness other than
as set forth in the existing loan documents.  There is no uncured
default by Seller or, to the best of Seller’s knowledge, any lender under the
Existing Indebtedness and no event has occurred which with notice, the passage
of time, or both, would constitute an event of default by Seller or, to the best
of Seller’s knowledge, any lender under the Existing Indebtedness.

     

    11. SURVIVAL
OF REPRESENTATIONS AND WARRANTIES

     

    A. All
representations and warranties provided herein may be relied upon by Purchaser
and shall survive the acquisition of the closing of the acquisition by Purchaser
of the Assigned Interests for a period of four (4) years (the “Survival
Period”).  The remedies for a breach of such representations shall
have a cumulative minimum claim of Fifty Thousand Dollars ($50,000) and shall in
no event exceed Five Hundred Thousand Dollars ($500,000).  Seller
shall indemnify Purchaser for any claims related to (i) the Excluded Assets and
Liabilities, (ii) any entities previously owned or controlled by IGP and
disposed of prior to or at Closing, (iii) any assets previously owned or
controlled by IGP directly or indirectly and disposed of prior to or at Closing,
(iii) any assets previously owned or controlled by IGP directly or indirectly
and disposed of prior to the Closing, (iv) any liabilities of IGP unrelated to
the IGP Assets, and (v) any other tax claims from activities of IGP and/or
related entities conducted up to Closing Date.  It is understood and
agreed that there shall be no monetary limit for a breach of representations and
warranties relating to any of the entities (e.g., IGP being acquired by
Purchaser) and such entity representations and warranties shall survive for a
period of four (4) years following Closing.  Seller and Purchaser
agree to place the amount of Two Hundred Fifty Thousand Dollars ($250,000) in an
escrow account held by a mutually agreeable third party with the purpose of
guarantying Seller’s obligations to Purchaser as described above.  The
escrow account shall provide for the annual distribution to Seller of a pro rata
portion of all moneys remaining in the escrow account at the end of such
year.  Purchaser acknowledges that Rafael Velez and other persons
associated with the Purchaser have detailed knowledge of the Seller, the Project
Partnerships and the Subject Properties. Therefore, notwithstanding anything to
the contrary contained in this Agreement, no claim may be made by Purchaser for
breach of any representation or other claim if prior to the Closing the facts
constituting such alleged breach or representation were known by Rafael Velez or
other person associated with the Purchaser.

     

    12. ADJUSTMENTS
AT CLOSING

     

    A. All
adjustments between Seller and Purchaser shall be made as of the date of the
Closing.  To the extent applicable, recordation and transfer taxes,
title costs and lender and servicer fees associated with the Closing and other
costs created in connection with the execution of miscellaneous leases and other
agreements will be split 50/50.

     

    B. No
withdrawals, adjustments, or prorations will be made relating to the purchase of
the Partnership Interest to the account of the Project Partnerships, including
but not limited to, operating cash, restricted cash, replacement reserves,
residual receipt accounts, dept service reserve escrows, tax or insurance
escrows, which shall remain the s of the Project Partnership at
Closing.

     

    13. PUBLICITY

     

    Neither
Seller nor Purchaser shall make any public statement or issue any press release
prior to the Closing with respect to this Agreement or the transactions
contemplated in this Agreement without the prior written consent of the other
party, except as otherwise required by Legal Requirement (including any
Securities and Exchange Commission reporting requirements).

     

    14. CONFIDENTIALITY

     

    Purchaser
and its representatives shall hold in strictest confidence all non-public data
and information obtained from Seller, whether obtained before or after the
execution and delivery of this Agreement.  This Agreement shall
supersede and replace any prior confidentiality agreement between Seller and
Purchaser or any of its affiliates, and any such prior agreement, to the extent
applicable to Purchaser, are hereby terminated and shall be of no further force
and effect.

     

    15. EMPLOYEES

     

    It is
understood by both parties that IGP recently reorganized its work force and as a
result, made employee cuts at various levels of the company.  Seller
agrees that IGP shall not hire additional employees, who shall remain employees
of IGP after Closing and Seller shall bear the termination costs of any employee
terminated prior to Closing.  Purchaser shall retain, through its
related entity PSI, 100% of the employees that are employed by IGP, excluding
however, those employees who work for the excluded entities, as listed in Schedule 15
attached.  PSI shall be responsible for all Legal Requirements
regarding any severance benefit payable to any of the retained employees if such
payment becomes due for reason of unjust dismissal, and PSI shall indemnify
Seller and its Affiliates from and against any liability for such severance
payments.  Seller will be responsible for all Ineligible Liabilities
up to the Closing Date and for all liabilities accrued in IGP’s books as of the
date of the Closing related to such employee expenses, i.e., accrued vacations,
payroll taxes, etc.  The accrued liabilities related to the employees
that will be retained by IGP and/or a related entity after Closing shall have
been paid by Seller at the Closing date.

     

    16. CONDUCT
PRIOR TO CLOSING

     

    A. During
the period commencing on the Effective Date and ending on the Closing Date
(unless this Agreement shall be terminated prior to a Closing), the business and
affairs of IGP and the Project Partnerships will be conducted only in their
ordinary course, and neither IGP nor any of the Project Partnerships must
experience any adverse change in their respective business, properties, aspects
or prospects.  Seller agrees that, without prior written approval of
Purchaser, Seller will not (and will cause or ensure that IGP does
not):

     

    
      	
              (i)  

            	
              enter
      into or modify (except as required by applicable law) any compensation,
      benefit, or other plan, agreement or arrangement (whether written or oral)
      with respect to any of their directors, officers or employees; except
      however, the IGP/Seller can continue with the current negotiations of the
      Union Bargaining Agreement;

            

    

     

    
      	
              (ii)  

            	
              modify
      substantially the manner in which it has heretofore conducted its
      business, either into any new line of business or amend its Partnership
      Agreement;

            

    

     

    
      	
              (iii)  

            	
              dispose
      of or discontinue any of its material business or properties (except for
      the Excluded Assets and Ineligible Liabilities) or merge or consolidate
      with any other entity;

            

    

     

    
      	
              (iv)  

            	
              dispose
      of or acquire any material contracts or material assets, including without
      limitation, intellectual property, except in the ordinary course of
      business;

            

    

     

    
      	
              (v)  

            	
              take
      any other action not in the ordinary course of business;
  or

            

    

     

    
      	
              (vi)  

            	
              agree
      to take any foregoing actions.

            

    

     

    B. From and
after the Effective Date and until the Closing, Purchaser will have the right to
appoint an administrative agent who will work on a day-to-day basis with the
management of IGP to ensure the orderly and timely transition of the operation
of the Project Partnerships and the related Subject Properties to Purchaser at
the Closing.  The administrative agent appointed by Purchaser shall
have continuous access to financial and accounting records of IGP related to the
Project Partners and related Subject Properties.

     

    C. Insurance.  Seller
will keep each Subject Property fully insured against all usual risks and will
maintain in effect all insurance policies now maintained on the same, through
the Closing Date.

     

    D. Performance Under
Leases.  Seller agrees that it will continue to perform all of
its obligations as landlord under all Leases and shall, immediately upon
obtaining knowledge of a material change in facts or circumstances which renders
any information contained on the Rent Rolls inaccurate, promptly notify
Purchaser of said facts or circumstances.

     

    E. Further
Tenancies.  Without the prior written consent of the Purchaser,
none of the Leases will be amended to reduce the rents or other charges
thereunder or will be renewed for rents or other charges which are less than
those payable prior to such renewal (unless permitted under the appropriate HAP
Agreement).

     

    F. Purchaser’s Financing and
Equity Investments.  Purchaser acknowledges that Seller will be
negatively impacted if the Required Approvals are obtained and the Closing does
not occur.  Accordingly, during the time that this Agreement is in
effect, including during the Due Diligence Period, Purchaser shall promptly
inform Seller of any change in the financing or equity investments that will
have, or may reasonably be expected to have, an adverse effect on the funds
needed by Purchaser to consummate the transaction contemplated in this
Agreement.  Further, upon the occurrence of any such change, Purchaser
shall also cease seeking the Required Approvals until and unless Seller
authorizes Purchaser to continue seeking such approvals.

     

    17. CONDITIONS
PRECEDENT

     

    A. Purchaser’s Conditions
Precedent.  Unless waived by Purchaser in its sole and absolute
discretion, Purchaser’s obligations to consummate the transactions contemplated
by this Agreement and proceed to Closing (as hereinafter defined), are expressly
conditioned upon the following:

     

    
      	
              (i)  

            	
              All
      representations and warranties of Seller set forth in this Agreement
      remain materially true and correct;

            

    

     

    
      	
              (ii)  

            	
              There
      is no pending or threatened material claims or litigation involving the
      Partnership Interests or the IGP
Assets;

            

    

     

    
      	
              (iii)  

            	
              Purchaser’s
      lender fails to provide to close on the financing to which such lender
      committed in writing during the Due Diligence Period and such failure is
      not occasioned by any action or inaction within Purchaser’s control;
      and

            

    

     

    
      	
              (iv)  

            	
              All
      Required Approvals have been
obtained.

            

    

     

    
      	
              (v)  

            	
              No
      Material Adverse Change has
occurred.

            

    

     

    B. Seller’s Conditions
Precedent.  Unless waived by Seller in its sole and absolute
discretion, Seller’s obligations to consummate the transactions contemplated by
this Agreement and proceed to Closing (as hereinafter defined), are expressly
conditioned upon the following:

     

    
      	
              (i)  

            	
              All
      representations and warranties of Purchaser set forth in this Agreement
      remain materially true and correct;
and,

            

    

     

    
      	
              (ii)  

            	
              All
      Required Approvals have been
obtained.

            

    

     

    18. CLOSING

     

    A. Consummation
of the purchase and sale of IGP’s Interests, as contemplated herein (the “Closing”), shall take place at
the offices of Purchaser one week following the end of the Required Approval
Delivery Period (as the same may have been extended) provided that all required
approvals have then been obtained  (the “Closing Date”).

     

    B. At the
Closing, Seller shall deliver to Purchaser (the “Closing
Documents”):

     

    
      	
              (i)  

            	
              Two
      (2) Assignments and Assumptions of Limited Partnership Interests in the
      forms attached hereto as Exhibits A-1 and A-2 and made a part hereof for
      all purposes (collectively, the “Assignment’)
      which Assignment shall have been signed and consented by
      _______________________ both in its capacity as the general partner of IGP
      and on behalf of IGP;

            

    

     

    
      	
              (ii)  

            	
              Any
      and all instruments, consents, and approvals as may be required to
      consummate the transfer contemplated herein, as required under Article
      _______ of IGP’s Partnership
Agreement;

            

    

     

    
      	
              (iii)  

            	
              Evidence
      reasonably satisfactory to the Purchaser that Seller has the authority to
      consummate the transaction contemplated herein and that the person signing
      on behalf of Seller has the authority to bind
  Seller;

            

    

     

    
      	
              (iv)  

            	
              An
      affidavit pursuant to Section 1445(b)(2) of the Internal Revenue Code that
      Seller is not a “foreign person” or a portion of the Purchase Price shall
      be withheld, as required by law;

            

    

     

    
      	
              (v)  

            	
              Assignment
      and Assumption of Lease for Escorial I Office Building executed by IGP as
      assignor; and,

            

    

     

    
      	
              (vi)  

            	
              Legal
      opinion of Seller’s counsel in form and substance agreed upon by the
      parties during the Due Diligence
Period.

            

    

     

    C. At the
Closing, Purchaser shall deliver to Seller:

     

    
      	
              (i)  

            	
              Payment
      of the Purchase Price in cash or readily available funds net of certain
      costs incurred in the consummation of this transaction, which costs Seller
      has agreed to bear;

            

    

     

    
      	
              (ii)  

            	
              Assignment
      and Assumption of Lease for Escorial I Office Building executed by PSI as
      assignee; and

            

    

     

    
      	
              (iii)  

            	
              The
      Assignment, wherein Purchaser agrees to be bound by the provisions of
      IGP’s Partnership Agreement.

            

    

     

    19. MISCELLANEOUS

     

    A. “As
Is”.  Other than as expressly set forth in this Agreement,
Seller is selling the Partnership Interests in IGP in their “as is” condition
and makes no representation or warranties concerning IGP or the operations and
distributions of IGP or any IGP property or liabilities.

     

    B. No
Reliance.  Purchaser represents that it has sufficient
knowledge concerning IGP and the operations and distributions of IGP and it is
not relying on any representations or warranties by the Seller other than
specifically set forth in this Agreement.

     

    C. Time of
Essence.  Time is of the essence in this
Agreement.

     

    D. Entire
Agreement.  This Agreement constitutes the entire agreement of
the parties.  All understandings and agreements heretofore had between
the parties are merged in this Agreement, which alone fully and completely
expresses their understandings. This Agreement may not be amended, modified,
altered or changed in any respect whatsoever, unless initialed by both Seller
and Purchaser, or by a further agreement in writing, signed by both
parties.

     

    E. Notices.  Any
notices required or permitted hereunder shall be in writing and either hand
delivered, sent by facsimile transmittal, overnight courier or sent United
States mail, postage prepaid, registered or certified mail, return receipt
requested, addressed as follows:

     

    
      	
               
      

            	
              PURCHASER:

            	
              Partners
      Business Equities

            

    

    Call Box
6030, PMB 343

    Caroline,
PR  00984-6030

    
      	
               
      

            	
              Attention:  _____________

            

    

    Phone:

     

    Fax:

     

    
      	
               
      

            	
              Seller:

            	
              American
      Community Properties Trust

            

    

    222
Smallwood Village Center

    St.
Charles, Maryland 20602

    Attention:  J.
Michael Wilson

    Chairman
and CEO

    Phone:  301-___-____

    Fax:  301-___-____1

    

    Any
notices sent by United States mail shall be deemed received, whether or not
actually received, on the second business day after the date on which same is
deposited in an official receptacle for the United States mail. If hand
delivered or sent by facsimile transmittal, overnight courier, said notice shall
be deemed received on the date of actual receipt. Any notices sent by United
States mail shall be deemed received, whether or not actually received, on the
second business day after the date on which same is deposited in an official
receptacle for the United States mail.  If hand delivered or sent by
facsimile transmittal or overnight courier, said notice shall be deemed received
on the date of actual receipt.

     

    F. Puerto Rico Law
Governs.  This Agreement shall be governed, construed and
enforced in accordance with the laws of the Commonwealth of Puerto
Rico.

     

    G. Attorneys
Fees.  In the event this Agreement or any provision hereof
becomes the subject of litigation, venue thereof shall be in the Commonwealth of
Puerto Rico.  The prevailing party in such litigation shall be
entitled to recover from the non-prevailing party all reasonable legal expenses
relating thereto including, but not limited to court costs and reasonable
attorney’s fees and other reasonable fees paid to third parties with respect
thereto.

     

    H. Counterparts.  This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original.  It will be necessary to account for only one such
counterpart in proving this Agreement.  Signatures to this Agreement
transmitted by telecopy, facsimile or electronic mail will be valid and
effective to bind the party so signing.  Each party agrees to promptly
deliver any execution original of this Agreement with its actual signature to
the other party, but a failure to do so will not affect the enforceability of
this Agreement, it being expressly agreed that each party to this Agreement will
be bound by its own signature sent by telecopy, facsimile or electronic mall and
will accept the signature of the other party so transmitted.

     

    I. Further
Assurances.  The parties hereto agree to cooperate with each
other after the closing of the transactions contemplated in this Agreement and
in the Closing Documents and shall execute and deliver to the other party all
instruments and documents as such other party may deem reasonably necessary in
order to fully carry out the intent and purposes of this Agreement and the
Closing Documents.

     

    J. Permitted
Assigns.  This Agreement may be assigned, in whole, but not in
part, to an entity owned or controlled by Purchaser, with Seller’s consent which
shall not be unreasonably withheld or delayed; provided, however, no such
assignment shall release Purchaser from its obligations hereunder.

     

    K. Exhibits and
Schedules.  The following exhibits and Schedules are attached
hereto and made a part hereof::

     

    Schedule
1(C)                                          Excluded
Assets

     

    Schedule
1(C-1)                                       Excluded
Leases

     

    Schedule
1(J)                                           Management
Agreements

     

    Schedule
1(L)                                           Partnership
Interests

     

    Schedule
1(O)                                          Project
Partnership

     

    Schedule
1(P)                                           Subject
Properties

     

    Schedule
7(A)                                           Required
Approvals

     

    Schedule
9(A)                                           Ownership
of Project Partnerships

     

    Schedule
9(C)(i)                                 
      Litigation re IGP

     

    Schedule
9(C)(ii)                                       Financial
Statements of IGP

     

    Schedule
10(A)                                         Condemnation
and Actions

     

    Schedule
10(B)                                         Title
Encumbrance Defaults

     

    Schedule
10(C)                                         Violation
Notices

     

    Schedule
10(E)                                         Brokers

     

    Schedule
10(F)                                   
     Environmental Reports

     

    Schedule
10(J)                                         Litigation
re Subject Properties

     

    Schedule
15                                        
    Employees Retained by IGP Group

     

    L. Update to
Schedules.  The Seller shall give prompt written notice to
Buyer of (i) the occurrence (including the discovery of facts after the
execution of this Agreement not known as of the date hereof to the disclosing
party) or non-occurrence of any event, the occurrence or non-occurrence of which
would, or would be reasonably likely to, cause, (x) any representation or
warranty contained in Articles 8, 9, or 10 hereof to be untrue or inaccurate in
any material respect or (y) any covenant or agreement contained in this
Agreement not to be complied with in any material respect and (ii) any failure
to satisfy any condition to the consummation of the transactions contemplated by
this Agreement; provided however that the delivery of any notice pursuant to
this Section 19 (I) shall not (x) operate to in any way modify or cure any
breach of the representations and warranties made by the Seller in Article 9
hereof or any exhibits or schedules referred to herein or attached hereto or (y)
limit or otherwise affect the remedies available hereunder to the party
receiving such notice, including the right not to consummate the transactions
contemplated by this Agreement if the matters referred to in the notice would
cause any of the conditions to the receiving party’s obligations not to be
fulfilled.  Within 15 days of the date of this Agreement, the Seller
shall update all of the schedules described in Article 19 (K) as necessary to
make the representations and warranties related to such schedules to be true and
correct in all material respects.  Notwithstanding the foregoing,
Purchaser acknowledges that Rafael Velez and other persons associated with the
Purchaser have detailed knowledge of the Seller, the Project Partnerships and
the Subject Properties.  Consequently, no failure by Seller to give
notice to Purchaser pursuant to this Section 19.L shall entitle Purchaser to any
remedies against Seller if the facts constituting the basis for such claim were
known by Rafael Velez or other person associated with the
Purchaser.

     

    EXECUTED as of the Effective
Date.

     

    

    Seller:

     

    AMERICAN COMMUNITY PROPERTIES TRUST,
a Maryland real estate investment trust

     

    

     

    By:           _________________________________

    J.
Michael Wilson

    Chairman
and CEO

    

     

    PURCHASER:

     

    PARTNERS BUSINESS EQUITIES, a
____________________

     

    
      	
               
      

            	
              By:

            	
              Municipal
      Associates III, LLC, a Delaware limited liability company, its general
      partner

            

    

    

    
      	
               
      

            	
              By:

            	
              CB
      Municipal Advisers III, LLC, a Delaware limited liability company, its
      manager

            

    

    

    

    
      	
               
      

            	
              By:  __________________________

            

    

    
      	
               
      

            	
              Rafael
      Velez Rivera

            

                                                                                                              
Authorized Representative

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
A-1

     

    

     

    ASSIGNMENT
AND ASSUMPTION OF LIMITED PARTNERSHIP INTEREST

     

    This
Assignment and Assumption of Limited Partnership Interest (this “Assignment”) is made
and entered into as of ____, 2009, by and between  , as the
assignor (the “Assignor”), and PARTNERS BUSINESS EQUITIES, a
_______________________ (the “Assignee”).

     

    WITNESSETH:

     

    WHEREAS,
Assignor is the owner of a ____ percent (__%) limited partnership interest in
__________________________, a _____________________ limited partnership (the
“Partnership”);

     

    WHEREAS,
Assignor desires to convey to Assignee its ___ percent (__%) limited partnership
interest in IGP, being Assignor’s entire interest therein (herein called the
“Transferred
Interest”) for consideration in the amount of _________________________
Dollars ($________) (the “Purchase Price”), which Purchase Price shall be
payable in cash; and

     

    WHEREAS,
Assignee desires to purchase from Assignor and receive from Assignor the
Transferred Interest.

     

    NOW,
THEREFORE, for and in consideration of (i) payment by Assignee to Assignor of
the Purchase Price, and (ii) other good and valuable consideration paid by
Assignee to Assignor, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

     

    1.           Concurrently
upon execution hereof, Assignee has paid to Assignor the Purchase
Price.

     

    2.           Assignor
hereby transfers, assigns, sells and conveys the Transferred Interest to
Assignee free and clear of all liens, security interests, encumbrances and other
attachments whatsoever.

     

    3.           Assignee
hereby agrees to be bound by the provisions of that certain Agreement of Limited
Partnership of ______________________, dated _____________________ (the “Partnership
Agreement”) and agrees to assume the obligations of Assignor under the
Partnership Agreement.

     

    4.           Assignor
has full right, title and authority to transfer, assign, sell and convey to
Assignee the Transferred Interest, and no other party has any right, option,
interest or claim to all or any part of the Transferred Interest, whether
subject to contract, option agreement, right of first refusal, reversionary or
future interests, or right of reverter, and there is no lien, security interest
or other matter affecting the Transferred Interest or any part thereof or
attachments or assignments filed or contemplated thereon.

     

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

     

    6.           This
Assignment may be executed by one or all of the parties in several counterparts,
including by facsimile, and all such counterparts so executed shall together be
deemed to constitute one final agreement as if signed by all parties, and each
such counterpart shall be deemed to be an original.

     

    7.           Each
party hereto agrees to execute any and all documents and to perform such other
acts as may be necessary or expedient to further the purpose of this Assignment
and the transactions contemplated hereby.

     

    8.           This
Assignment shall be governed by and construed and interpreted in accordance with
the substantive laws of the State of Maryland.

     

    EXECUTED
and DELIVERED as of the day and year first written above.

     

    ASSIGNOR:

     

    

    ASSIGNEE:

     

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
A-2

     

    

     

    ASSIGNMENT
AND ASSUMPTION OF LIMITED PARTNERSHIP INTEREST

     

    This
Assignment and Assumption of Limited Partnership Interest (this “Assignment”) is made
and entered into as of   ____, 2009, by
and between _____________________, a ___________ corporation, as the assignor
(the “Assignor”), an   as the
assignee (the “Assignee”).

     

    WITNESSETH:

     

    WHEREAS,
Assignor is the owner of a ­­­­­­­percent
(­­­%) limited partnership interest in ______________________, a
_________________ limited partnership (the “Partnership”);

     

    WHEREAS,
Assignor desires to convey to Assignee its
­­­­­­­­ percent (­­%) limited
partnership interest in IGP, being Assignor’s entire interest therein (herein
called the “Transferred
Interest”) for consideration in the amount of
­­­­­­­ Dollars
($­­­­­­­­­­) (the “Purchase Price”),
which Purchase Price shall be payable in cash; and

     

    WHEREAS,
Assignee desires to purchase from Assignor and receive from Assignor the
Transferred Interest.

     

    NOW,
THEREFORE, for and in consideration of (i) payment by Assignee to Assignor of
the Purchase Price (ii) other good and valuable consideration paid by Assignee
to Assignor, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:

     

    1.           Concurrently
upon execution hereof, Assignee has paid to Assignor the Purchase
Price.

     

    2.           Assignor
hereby transfers, assigns, sells and conveys the Transferred Interest to
Assignee free and clear of all liens, security interests, encumbrances and other
attachments whatsoever.

     

    3.           Assignee
hereby agrees to be bound by the provisions of that certain Agreement of Limited
Partnership of _________________, dated _____________________ (the “Partnership
Agreement”) and agrees to assume the obligations of Assignor under the
Partnership Agreement.

     

    4.           Assignor
has full right, title and authority to transfer, assign, sell and convey to
Assignee the Transferred Interest, and no other party has any right, option,
interest or claim to all or any part of the Transferred Interest, whether
subject to contract, option agreement, right of first refusal, reversionary or
future interests, or right of reverter, and there is no lien, security interest
or other matter affecting the Transferred Interest or any part thereof or
attachments or assignments filed or contemplated thereon.

     

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

     

    6.           This
Assignment may be executed by one or all of the parties in several counterparts,
including by facsimile, and all such counterparts so executed shall together be
deemed to constitute one final agreement as if signed by all parties, and each
such counterpart shall be deemed to be an original.

     

    7.           Each
party hereto agrees to execute any and all documents and to perform such other
acts as may be necessary or expedient to further the purpose of this Assignment
and the transactions contemplated hereby.

     

    8.           This
Assignment shall be governed by and construed and interpreted in accordance with
the substantive laws of the State of Maryland.

     

    EXECUTED
and DELIVERED as of the day and year first written above.

     

    ASSIGNOR:

     

    

    

    

    

    ASSIGNEE:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
1 (C)

     

    EXCLUDED
ASSETS, LIABILITIES AND OTHER

     

    I - All Assets and
Liabilities related to the following entities:

    Brisas de
Parque Escorial, Inc.

    ELI

    El Monte
Properties, S.E.

    Escorial
Office Building I, Inc.

    IGP Group
Corp, (with the exception of those assets of IGP Group Corp which are the
subject of the IGP Purchase described in this Letter and its Schedule A
attached)

    Interstate
Commercial Properties, Inc.

    Land
Development Associates, S.E.

    LDA
Group, LLC

    Torres
del Escorial, Inc.

     

    II - Furniture, Fixtures and
Painting:

    1 -
Reception desk (located in “collection office”)

    1 -
Reception chair (located in “collection office”)

    1 - Desk
with left lateral (located in “collection office”)

    1 -
Executive chair (located in “collection office”)

    1 -
Secretary desk (located in “collection office”)

    4 -
Visitors chairs (located in “collection office”)

    1 -
Double module for two employees (located in IGP office)

    1 - Plans
cabinet (located in IGP office - Jorge’s area)

    4 - Files
cabinet (located in IGP office - Jorge’s area)

    2 - Files
cabinet (located in IGP office - Lucy’s area)

    2 - Files
cabinet (located in IGP office - Wilma’s area)

    1 - File
cabinet (located in IGP - Salich’s area)

    1 - Chair
for Salich (located in IGP - Salich’s area)

    1 - Chair
for Gilberto (located in IGP office - Gilberto’s office)

    1 - Chair
for Jorge (located in IGP office - Jorge’s office)

    1 -
Jorge’s computer (located in IGP office)

    1 -
Gilberto’s computer (located in IGP office)

    1 -
Salich’s computer (located in IGP office)

    1 -
Lucy’s computer (located in IGP office)

    1 -
Juanita’s computer (located in IGP office)

    5 -
Microsoft Office Licenses (located in IGP/IT office)

    1 - Fax
Machine (located in IGP/IT office)

    2 -
Painting (1966) by Ruben Moreira (located in IGP office)

    2 -
Painting (1966) by Rafael Tufiño (located in IGP office)

    1 -
Painting (1966) by Augusto Marin (located in IGP office)

    1 -
Painting (1966) by Rafael Rios Rey (located in IGP office)

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    SCHEDULE
1 (C) - Cont.

     

    EXCLUDED
ASSETS, LIABILITIES AND OTHER

     

    II - Furniture, Fixtures and
Painting (Continue):

     

    1 -
Parque Escorial portrait (located in IGP office conference room)

    1 -
Brisas de Parque Escorial portrait (located in Jorge’s office)

    1 -
Torres del Escorial portrait (located in Jorge’s office)

    1 - Yardi
Software (located in IGP/IT office)

    1 - Auto
CAD License (located in IGP/IT office)

    5 - UPS
backup (located in IGP office)

    3 -
Printers (located in Lucy, Juanita and Gilberto’s area)

     

    Note: The
following equipment shall be bought by ACPT/IGP Group Corp:

    
      	
              §  

            	
              Server
      unit (for Active Directory and
Data)

            

    

    
      	
              §  

            	
              Sonicwall
      TZ-180 (VPN to St. Charles)

            

    

    
      	
              §  

            	
              Telephone
      System (connected to ACPT)

            

    

    
      	
              §  

            	
              Copier

            

    

    
      	
              §  

            	
              Anti-Virus
      (6)

            

    

     

    All
furniture and fixtures located in the office of Parque Escorial Residential
Owners Association belongs to the Association.

     

    III - Employment Agreement
dated on May 12, 2004, between Interstate General Properties Limited
Partnership, S.E. and Mr. Jorge Garcia Massuet

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    SCHEDULE
1 (J)

     

    MANAGEMENT
AGREEMENTS

     

    
      	
              MANAGEMENT AGREEMENTS

            	
              AFFILIATED PROPERTY

            
	
              Proviviendas
      I Inc.

            	
              Las
      Americas I Apartments

            
	
              Proviviendas
      II Inc.

            	
              Las
      Americas II Apartments

            
	
              Proviviendas
      III Inc.

            	
              Las
      Lomas Apartments

            
	
              Proviviendas
      IV Inc.

            	
              Monacillos
      Apartments

            
	 
      	 
      
	
              Alturas
      del Senorial Associates Limited Partnership

            	
              Alturas
      del Senorial Apartments

            
	
              Bayamon
      Garden Associates Limited Partnership

            	
              Bayamon
      Garden Apartments

            
	 
      	 
      
	
              Carolina
      Associates Limited Partnership, S.E.

            	
              De
      Diego Apartments

            
	 
      	
              Torre
      de Las Cumbres Apartments

            
	 
      	
              Santa
      Juana Apartments

            
	 
      	
              Monserrate
      Tower II Apartments

            
	 
      	 
      
	
              Colinas
      de San Juan Associates Limited Partnership

            	
              Colinas
      de San Juan Apartments

            
	
              Monserrate
      Associates Limited Partnership

            	
              Monserrate
      Apartments I

            
	
              San
      Anton Associates, S.E.

            	
              San
      Anton Apartments

            
	
              Jardines
      de Caparra Associates Limited Partnership

            	
              Jardines
      de Caparra Apartments

            
	
              Turabo
      Limited Dividend Partnership

            	
              Vistas
      del Turabo Apartments

            
	
              Valle
      del Sol Associates Limited Partnership

            	
              Valle
      del Sol

            

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    SCHEDULE
1 (O)

     

    PROJECT
PARTNERSHIPS

     

    
      	
              PARTNERSHIP NAMES OF PUERTO RICAN
      ASSETS

            	
              AFFILIATED
  PROPERTY

            

    

    

    IGP
- General Partner Interest

     

    
      	
              Alturas
      del Senorial Associates Limited Partnership

            	
              Alturas
      del Senorial Apartments

               

            
	
              Bayamon
      Garden Associates Limited Partnership

            	
              Bayamon
      Garden Apartments

            
	
              Carolina
      Associates Limited Partnership

            	
              De
      Diego Apartments

            
	 
      	
              Santa
      Juana Apartments

            
	 
      	
              Monserrate
      Tower II Apartments

            
	
              Colinas
      de San Juan Associates Limited Partnership

            	
              Colinas
      De San Juan Apartments

            
	
              Monserrate
      Associates Limited Partnership

            	
              Monserrate
      Apartments I

            
	
              San
      Anton Associates, S.E.

            	
              San
      Anton Apartments

            
	
              Jardines
      de Caparra Associates Limited Partnership

            	
              Jardines
      de Caparra Apartments

            
	
              Turabo
      Limited Dividend Partnership

            	
              Vistas
      del Turabo Apartments

            
	
              Valle
      del Sol Associates Limited Partnership

            	
              Valle
      del Sol

            

    

    

     

    IGP
- Limited Partner Interest

     

    
      	
              Monserrate
      Associates Limited Partnership

            	
              Monserrate
      Apartments I

            
	
              Turabo
      Limited Dividend Partnership

            	
              Vistas
      del Tirabo Apartments

            

    

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    

    SCHEDULE
15

     

    LIST
OF EMPLOYEES TO BE RETAINED BY IGP GROUP CORP.

     

    Jorge
Garcia Massuet - Senior Vice President

    Gilberto
E. Zayas - Controller and Assistant Vice President

    Francisco
Salich - Project Engineer

    Luz Lopez
- Executive Secretary

    Juana
Izquierdo - Accounts Payable/Disbursement Coordinator

    Henry
Vargas - Parque Escorial Administrator

    Karina
Mercado Soto - Office Clerk

    Jose L.
Florentino - Administrative Assistant

    Pedro
Medina - General Worker

    Pedro
Rondon - General Worker

    Juan
Santana - General Workerbydesign8kex102_462009.htm

     

    
      Exhibit
10.2

      [Letterhead
of AHC]

      

      March 31,
2009

      

      Deanie J.
Underwood, President

      By
Design, Inc.

      2519 east
Kentucky Avenue

      Denver,
Colorado 80209

      

      Re: Merger of Asset Holdings, Inc. and
By Design, Inc.

      

      Ladies
and Gentlemen:

      

      The purpose of this letter of intent
("Letter") is to set forth certain nonbinding understandings and certain binding
agreements between Asset Holdings Corporation, a Maryland corporation ("AHC"),
By Design, Inc., a Nevada corporation ("BYDE") and Deanie J. Underwood and
Bradley C. Underwood (the “Controlling Shareholders”), with respect to the
triangular statutory merger between AHC and a subsidiary of  BYDE
pursuant to Section 368(a)(1)(A) of the Internal Revenue Code of 1986, as
amended (the “Code”)(the "Merger").

      

      The following numbered paragraphs
reflect our understanding with respect to the matters described in them, but are
not to constitute a complete statement of, or a legally binding or enforceable
agreement or commitment on the part of, AHC, BYDE or the Controlling
Shareholders with respect to the matters described therein or to impose on AHC,
BYDE or the Controlling Shareholders an enforceable duty or obligation to
negotiate towards or conclude any such agreement or commitment.

      

      1.           Merger

      

      
        	
                (a)

              	
                On
      the terms and subject to the conditions to be set forth in a definitive,
      legally binding, written agreement to be negotiated and entered into by
      AHC, BYDE and the Controlling Shareholders (the "Agreement"), AHC will
      merge into BYDE, with BYDE being the surviving corporation, at the closing
      (the "Closing") specified in the Agreement.  Immediately after
      the Closing, the shareholders of AHC prior to the Merger shall own Ninety
      Two percent (92%) of the issued and outstanding shares of common stock of
      BYDE substantially in accordance with the Capitalization Table attached
      hereto as Exhibit A.1

              

      

      ________________

       

        
          	
                  1

                	
                  It
      is anticipated that eight (8%) of the issued and outstanding stock of BYDE
      immediately after the Merger shall be issued to Capital Group
      Communications, Inc., and its affiliates, for fees in connection with the
      Merger and certain consulting
services.

                

        

      

      

      
        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

      

      
        	
                (b)

              	
                The
      Closing is conditioned upon (i) the completion of a certified audit by a
      PCAOB accounting firm for filing with the Securities and Exchange
      Commission as part of a Form 8-K; (ii) the preparation for filing of a
      Form 8-K containing the material disclosures mandated by the Securities
      Act of 1933 (the “1933 Act”) and the Securities Exchange Act of 1934 (the
      “1934 Act”) pertaining to the operations of AHC and BYDE after the
      Closing; and  (iii) approval by the board of directors, and
      shareholders if necessary, of each of BYDE and
  AHC.

              

      

      

      
        	
                (c)

              	
                At
      the Closing, (i) the board of directors of BYDE, and members of any of its
      committees, shall resign and AHC shall appoint the members of the board of
      directors, and any committees thereto, of BYDE; (ii) the officers of BYDE
      shall resign and the subsequently appointed board of directors shall elect
      successor officers as designated by AHC; (iii) the Controlling
      Shareholders shall execute Restricted Stock Agreements whereby the stock
      of the Controlling Shareholders will be restricted from sale during the
      initial sixty days after the Closing; and (iv) the required forms shall be
      prepared to be filed pursuant to the 1934
Act.

              

      

       

      
        
          	
                  (d)

                	At the Closing, BYDE’s subsidiaries shall be sold to a
      private investor group selected by BYDE.

        

        

 

      

      2.           Other
Provisions

      

      The Agreement will contain usual and
customary representations, warranties, covenants, and other agreements, on
behalf of BYDE and AHC, and their respective stockholders, and the Closing will
be subject to usual and customary conditions, including:

                

      
        
          	 	(a) 	obtaining
      of necessary consents or approvals of governmental bodies, lenders,
      lessors, or other third parties;
	
                   
      

                	
                  (b)

                	
                  absence
      of pending or threatened litigation;

                
	 	      
                  (c)

                	      
                  satisfactory
      completion of each parties’ due diligence investigation and certified
      audit; and

                
	 	      
                  (d)

                	delivery
      of customary legal opinions, closing certificates, and other
      documentation.

        

      

      
        
        

      

      
        
        

      

       

          Upon
execution of counterparts of this Letter by you, the following lettered
paragraphs will constitute the legally binding and enforceable agreement of AHC,
BYDE and the Controlling Shareholders (in recognition of the significant costs
to be borne by AHC, BYDE and the Controlling Shareholders in pursuing this
transaction and further in consideration of their mutual undertakings as to the
matters described herein).

      

      
        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

      

      

      

      
        	
                (a)

              	
                Access.  Subject
      to the terms set forth in paragraph (g) below respecting confidentiality
      and certain other matters, each party to this Agreement will afford the
      other parties’ employees, auditors, legal counsel, and other authorized
      representatives all reasonable opportunity and access during normal
      business hours to inspect, investigate, and audit the assets, liabilities,
      contracts, operations, and business of AHC and BYDE, respectively, before
      Closing.  The parties will conduct such inspection,
      investigation, and audit in a reasonable manner during regular business
      hours.

              

      

      

      
        	
                (b)

              	
                Consents.  The
      parties hereto will cooperate with one another and proceed, as promptly as
      is reasonably practicable, to seek to obtain all necessary consents and
      approvals from lenders and landlords, and to endeavor to comply with all
      other legal or contractual requirements for or preconditions to the
      execution and consummation of the
Agreement.

              

      

      

      
        	
                (c)

              	
                Best
      Efforts.  The parties hereto will negotiate in good faith
      and use their best efforts to arrive at a mutually acceptable definitive
      Agreement for approval, execution, and delivery on the earliest reasonably
      practicable date.  The parties hereto will thereupon use their
      best efforts to affect the Closing and to proceed with the transactions
      contemplated by the Agreement as promptly as is reasonably
      practicable.

              

      

      

      
        	
                (d)

              	
                Exclusive
      Dealing.  Neither party hereto will offer to merge with
      any person other than the other, nor will either party, or any of its
      stockholders, enter into negotiation with any other party for the
      disposition of the business or stock of the other during the pendency of
      negotiations between AHC and BYDE, and neither AHC nor BYDE will
      unilaterally terminate these negotiations without cause unless: (i) the
      transactions contemplated by the Agreement shall not have been approved by
      the boards of directors of both AHC and BYDE; (ii) the Closing shall not
      have occurred on or before July 1, 2009; or (iii) a material change or
      event (exclusive of a competing offer) shall have occurred that would make
      proceeding with such execution and approval of the Agreement or such
      Closing illegal, invalid, or contrary to the fiduciary duties of the board
      of directors of AHC or BYDE.

              

      

      

      
        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

      

      

      
        	
                (e)

              	
                Costs.  AHC
      and BYDE will each be solely responsible for and bear all of its own
      respective expenses, including, without limitation, expenses of legal
      counsel, accountants, and other advisers, incurred at any time in
      connection with pursuing or consummating the Agreement and the
      transactions contemplated thereby.

              

      

      

      
        	
                (f)

              	
                Public
      Disclosure.  Before the Closing, neither AHC nor BYDE
      shall make any public release of information regarding the matters
      contemplated herein except (i) that a joint press release in agreed form
      shall be issued by AHC and BYDE as promptly as is practicable after the
      execution of this Letter, (ii) that AHC and BYDE may each continue such
      communications with employees, customers, suppliers, franchisees, lenders,
      lessors, shareholders, and other particular groups as may be legally
      required or necessary or appropriate and not inconsistent with the best
      interests of the other party or the prompt consummation of the
      transactions contemplated by this Letter, and (iii) as required by
      law.

              

      

      

      
        	
                (g)

              	
                Confidentiality.  The
      parties hereto agree that (except as may be required by law) they will not
      disclose or use and they will cause its officers, directors, employees,
      representatives, agents, and advisers not to disclose or use, any
      Confidential Information (as hereinafter defined) with respect to each
      other furnished, or to be furnished, by either party to the other in
      connection herewith at any time or in any manner and will not use such
      information other than in connection with its evaluation of the
      Merger.  For the purposes of this paragraph (g) "confidential
      information" means any information transmitted form one party to the other
      party.  If the Merger is not consummated, each party will
      promptly return all documents, contracts, records, or properties to the
      other.  The provisions of this paragraph (g) shall survive the
      termination of this Letter.

              

      

      

      
        	
                (h)

              	
                Except
      with respect to the provisions of paragraph (g), either party hereto may
      terminate this Letter and hereafter this Letter shall have no force and
      effect and the parties shall have no further obligations hereunder if the
      Agreement is not signed on or before April 15, 2009, if such terminating
      party is not in breach of any of the binding provisions
      hereof.

              

      

      

      

      

      
        	
                 
      

              	
                [This
      space left intentionally blank.]

              

      

      

      
        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

      

      

      

      Please
sign and date this Letter in the spaces provided below to confirm our mutual
understandings and agreements as set forth in the Letter and return a signed
copy to the undersigned.

      

      Very truly yours,

      

      

      Asset Holdings
Corporation

      

      By:  /s/ Yeota
Christie

      Name:  Yeota
Christie

      Title:  President

      Date:  March 31,
2009

      

      

      ACKNOWLEDGED
AND AGREED TO:

      

      BYDE

      

      By: 
/s/ Deanie J.
Underwood

      Name:
 Deanie J. Underwood

      Title:  President

      Date:  March
31, 2009

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