Document:

Exhibit
10.109

 

MASTER DEVELOPMENT AGREEMENT

 

This Master
Development Agreement (this “Agreement”) is made as of the 3rd day of August 2007, by and between BEHRINGER
HARVARD FRISCO SQUARE LP, a Texas limited partnership (“Owner”), and FRISCO
SQUARE DEVELOPMENT, LTD., a Texas limited partnership (“Developer”).

 

RECITALS:

 

A.            Owner
is the Owner of certain real property in Collin County, Texas, more
particularly described on Exhibit A attached hereto (the “Land”).

 

B.            Owner
has agreed to retain Developer for the furnishing of planning, project
development and construction management services with respect to the Land, as
more particularly set forth in this Agreement.

 

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

 

1.             General Description of
Project.
It is currently anticipated that the Land will be developed in phases, subject
to Owner’s decision to proceed with development of each phase, as follows: (a)
of the first phase, if constructed, will consist of approximately 67,528
leasable square feet consisting of 47,930 rentable square feet of office and
14,906 rentable square feet of retail space located on the southeast corner of
Main Street and Coleman Blvd. in Frisco, Texas (“Phase 1”); and
(b) subsequent phases, if constructed, will be determined based upon the
recommendation of Developer and approval of Owner, which approval may be given
or withhold in Owner’s sole discretion. As used herein, the term “Phase”
refers to Phase 1 and any additional phases of development on the Land
agreed upon by Owner; and the term “Project” means all the Phases
intended to be built on the Land from time to time.

 

2.             Decision
to Proceed With Development. In addition to having sole
discretion with respect to the configuration of, and square footage to be
constructed upon, each Phase, Owner shall have sole discretion as to whether or not
to proceed with the development of each Phase of the Project. At such time as
Owner elects to proceed with the development of a Phase, Owner shall send
notice (the “Notice to Proceed”) to Developer of such election. Subject
to the provisions of Section 3 below, within thirty (30) days after a Notice to
Proceed is issued by Owner, the parties shall execute a Development Agreement
(herein so called) in the form attached hereto as Exhibit B with
respect to the applicable Phase, with all blanks filled in as agreed upon by
the parties and all exhibits thereto agreed upon and attached. With respect to
Phase 1, however, the parties have agreed to proceed with such Phase
notwithstanding that a formal Notice to Proceed has not been issued;
accordingly, concurrently with the execution of this Agreement Owner and
Developer shall execute a Development Agreement with respect to Phase 1.

 

3.             Determination of Development
Fee. In
completing a Development Agreement with respect to a Phase, it is the intent of
the parties that the “Development Fee” payable to Developer under a Development
Agreement shall be equal to the market development fee (at the

 

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time such Development Agreement is executed) for
projects similar to the Phase that is the subject of such Development
Agreement, taking into accont the services to be rendered by the Developer
under such Development Agreement and the location of the Project. If the
parties are unable to agree upon the Development Fee to be inserted into a
Development Agreement within thirty (30) days after the Notice to Proceed is
issued with respect to the applicable Phase, the amount of the Development Fee
(i.e., the fair market value of the services to be rendered by the Developer
under the applicable Development Agreement) shall be determined by arbitration
pursuant to Section 29 below. In such event, the time for execution of the
applicable Development Agreement shall be extended to the tenth (10th) day after the amount of the
Development Fee is determined.

 

4.             Allocation of Costs. Developer and Owner
agree that the acquisition costs of the Land and certain grading and
infrastructure costs associated with the Project shall be allocated among the
different Phases as determined by Owner in its reasonable discretion.

 

5.             Termination.          Notwithstanding
anything contained to the contrary in this Agreement or in any Development
Agreement executed between the parties, Owner shall have the option to
terminate
this Agreement if one or more of the following events shall occur:

 

(a)           the filing by
Developer of a voluntary petition in bankruptcy, the filing by a creditor of an
involuntary petition in bankruptcy which is not dismissed within sixty (60)
days, the adjudication of Developer as bankrupt or insolvent, the filing by
Developer of any petition or answer seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution, assignment for the benefit of
creditors, or similar relief for debtors;

 

(b)           a good faith
determination by Owner that either (i) Developer is not developing the Project
(or a Phase thereof) in a manner satisfactory to Owner, or (ii) completion of
the Project is not economically feasible;

 

(c)           Owner sells the Land,
at Owner’s election;

 

(d)           Developer (or an
affiliate of Developer) defaults in any obligation under that certain operating
agreement of Owner dated August 3, 2007 and such default is not cured within
any applicable notice or grace period.

 

(e)           Frisco Square Land, Ltd., Frisco Square
Properties, Ltd., Frisco Square B1-6, F1-11, Ltd., and Frisco Square B1-7,
F1-10, Ltd., cease to own any interest in Owner.

 

(f)            Fairways
Frisco, LP no longer maintains Control (as hereinafter defined) of Developer
For purposes of the foregoing, the term “Control” means either: (i) the
ownership of fifty percent (50%) or more of the voting stock in Developer, or
(ii) the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of Developer, whether through
ownership of voting securities, by contract or otherwise.

 

6.             Duties
Upon Termination Upon termination of this Agreement, Developer shall,
within
ten (10) days thereafter, deliver to Owner complete copies of all books and
records maintained by Developer for the Project. Owner shall compensate
Developer for all fees earned hereunder through the date of termination promptly
following the delivery of the information

 

2

 

called for in the preceding sentence, subject to
any claims Owner may have arising out of Developer’s default in performance
hereunder.

 

7.             Notices. All notices,
requests, and communications required or permitted hereunder shall be in
writing and shall be sufficiently given and deemed to have been received
(a) upon personal delivery, (b) twenty four (24) hours after deposit
with a recognized overnight delivery service, (c) upon receipt of
electronic confirmation of receipt in the event of delivery by telefacsimile
(provided that such telefacsimile is followed by delivery by United State
mail), or (d) if mailed, upon the first to occur of actual receipt or
forty eight (48) hours after being placed in the United States mail, postage
prepaid, registered or certified mail, with return receipt requested. The
addresses to which notices should be sent are set forth on the signature pages
of this Agreement. Notice of a change in address of one of the parties shall be
given in writing to the other party as provided above, and shall be effective
only upon actual receipt.

 

8.             Assignment. Developer may not
assign its rights nor delegate its duties hereunder without the prior written
consent of Owner. Developer’s assignment in contravention of this Section shall
be null and void. Any permitted assignment by Developer shall not relieve
Developer of any of its obligations hereunder. Owner shall have the right to
assign its rights and duties under this Agreement without the consent of
Developer.

 

9.             Waiver of Lien Claims. Developer hereby
waives any and all rights it may now or hereafter have to assert a lien
(whether constitutional, statutory, conferred by common law or arising in any
other manner) against the Project or any part thereof.

 

10.           Lender Requirements. In the event that a
mortgagee of the Project or any part thereof (a “Project Lender”)
requests that Developer execute a document in connection with a loan to Owner,
Developer will respond to such request promptly and will not unreasonably
withhold its consent to the execution of such document (it being agreed that
Developer shall not be required to execute any document that reduces the “Development
Fee” payable to Developer under a Development Agreement). Without limiting the
generality of the preceding sentence, Developer agrees that it will execute and
deliver the following documents within five (5) days after request therefor:
(a) an agreement that a Project Lender may terminate this Agreement if a
default occurs in respect of any loan secured by the Project or any part
thereof; (b) an estoppel certificate certifying that this Agreement is in full
force and effect and containing such other certifications as may be reasonably
requested; (c) an agreement subordinating this Agreement and the fees payable
to Developer hereunder (or under a Development Agreement) to any mortgage or
deed or trust held by a Project Lender; and (d) confirmation of the waiver by
Developer of any right to assert a lien against the Project. Developer shall
use reasonable care to avoid any act or omission that, in the performance of
its duties hereunder, shall in any way conflict with the terms of any mortgage
documents in respect of the Project, provided that Developer has been furnished
with copies of such mortgage documents. In addition, Developer agrees to
conform its general policies and procedures to any commercially reasonable
requirements of any Project Lender providing financing for the acquisition or
construction of the Project or any part thereof.

 

11.           Governing Law. This Agreement shall
be governed and construed in accordance with the laws of the State of Texas.

 

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12.           Compliance
Amendments. Reference is made to Behringer Harvard Opportunity Op I LP, a
Texas limited partnership (“BH REIT”), which
owns a direct or indirect interest in Owner. Notwithstanding anything contained
herein to the contrary, in the event that legal counsel for Owner reasonably
determines that an amendment to this Agreement is necessary or advisable in
order for this Agreement to comply with applicable tax laws (including, without
limitation, laws and regulations pertaining to real estate investment trusts),
applicable securities laws, the offering documents pertaining to BH REIT or any Affiliate, or the Statement of Policy Regarding Real Estate Programs of the North American
Securities Administrators Association, Inc., effective September 29, 1993, as amended, then Owner and
Developer shall, within ten (10) business days after request from Owner, execute such an amendment; provided, however, that no
such amendment may decrease the compensation to which Developer is entitled
hereunder or materially increase Developer’s liabilities or obligations under
this Agreement without Developer’s written consent.

 

13.           Entireties,
Beneficiaries. This Agreement and any Development Agreement executed pursuant hereto
represents the entire Agreement between Owner and Developer with regard to management
of the Project and all prior agreements are superseded hereby. This Agreement
is for the sole benefit of Owner and Developer and no other party is benefited
hereby. This Agreement creates contractual rights only between Owner and
Developer, and Developer has no lien rights in or to the Project.

 

14.           No Agency. Developer and its
agents shall all act as independent contractors in respect of Owner with regard
to this Agreement. All personnel and staff of Developer shall be and remain
employees or agents of, or independent contractors with, Developer and not of
or with Owner. Developer shall at all times represent to third parties that the
relationship of Developer to Owner, with regard to Developer’s duties under
this Agreement, is that of independent contractor, and Developer and Owner
shall not represent to any party that Developer and Owner are partners,
co-venturers or principal and agent, or have any other relationship other than
that of independent contractors with regard to this Agreement. Developer’s
authority to act on behalf of Owner is strictly limited to that expressly
delegated herein. Developer represents and warrants that (a) it has all the
requisite licenses and other approvals required by law to carry out its duties
hereunder; or (b) it will affect the services requiring such licenses through
duly licensed agents and subcontractors who are affiliates of Developer that
have all requisite licenses and authority to carry out such services.

 

15.           Attorneys’ Fees. Should either the
Owner or the Developer employ an attorney or attorneys to enforce any of the
terms and conditions of this Agreement, or to protect any right or interest
created or evidenced hereby, the losing party shall pay the party obtaining
final, unappealable judgment all reasonable costs, damages and expenses,
including reasonable attorneys’ fees and expenses incurred by the prevailing
party.

 

16.           No Waiver. The failure of
either party to seek redress for violation, or to insist upon the strict
performance of any covenant, agreement, provision or condition of this
Agreement shall not constitute a waiver of such strict performance and the
parties shall have all remedies provided in this Agreement and by applicable
law with respect to any subsequent act which would he originally constituted a
violation.

 

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17.           Interpretation. Within this
Agreement, words of any gender shall be held and construed to include any other
gender, and words in the singular number shall be held and construed to include
the plural, unless the context otherwise requires. The paragraph headings used
in this Agreement are intended for reference purposes only and shall not be
considered in the interpretation of the terms and conditions of this Agreement.

 

18.           Severability. If one or more of
the provisions of this Agreement or any application of this Agreement shall be
invalid, illegal or unenforceable in any respect, the validity, legality or
enforceability of the remaining provisions of this Agreement and any other
application of such provisions shall in no way be affected or impaired.

 

19.           Amendments. This Agreement may
be amended, from time to time, only with the written consent of both Owner and
Developer.

 

20.           Counterparts. This Agreement may
be executed in several counterparts, each of which shall be deemed an original,
and said counterparts shall constitute but one and the same instrument.

 

21.           Additional Acts. In connection with
this Agreement, as well as all transactions contemplated by this Agreement,
Owner and Developer each agree to execute and deliver such additional documents
and instruments and take all such necessary action and perform such additional
acts as may be necessary or appropriate to effectuate, carry out and perform
all of the terms, provisions and conditions of this Agreement and all such
transactions; provided, however, this Agreement may be modified only in
accordance with the terms hereof.

 

22.           Exhibits. All exhibits
referred to herein shall be considered a part of this Agreement as fully as if
and with the same force and effect as if such exhibit had been included herein
in full.

 

23.           Limitation of
Liability. Any liability of Owner to Developer (or any person or entity claiming
by, through or under Developer) for any default by Owner under this Agreement
or any matter relating to this Agreement shall be limited to Developer’s actual
direct, but not consequential, damages therefore. Owner’s liability under this
Agreement is limited to Owner’s interest in the Project, and if Owner is comprised
of more than one entity, the liability of each entity comprising Owner shall be
several only (not joint) based upon such entity’s proportionate share of
ownership in the Project. Any liability of Developer to Owner (or any person or
entity claiming by, through or under Owner) for any default by Developer under
this Agreement or any matter relating to this Agreement shall be limited to
Owner’s actual direct, but not consequential, damages therefor.

 

24.           Confidentiality. Developer will keep
confidential (a) the terms of this Agreement, and (b) all written and verbal
negotiations and communications with Owner in connection with this Agreement
(collectively, “Confidential Information”), and Developer will not
disclose or make available any Confidential Information to any other person or
entity, except to Developer’s accountants, brokers, attorneys, and other agents
for the purpose of providing advice to Developer in connection with the
Confidential Information and who agree to preserve the

 

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confidential nature of the Confidential
Information, or as Developer is required to disclose by law or court order.

 

25.           Authority of Developer. Developer shall have
no right or authority, express or implied, to commit or otherwise obligate
Owner in any manner whatsoever except to the extent specifically provided
herein or specifically authorized in writing by Owner.

 

26.           Licenses. Developer shall, at
its own expense, qualify to do business and obtain and maintain such licenses
as may be required for the performance by Developer of its services.

 

27.           Non-Discrimination
Policy.
Developer agrees that it will not deny the benefits of this Agreement to any
person, nor discriminate against any employee or applicant for employment because
of race, color, religion, sex, national origin, age or any other applicable
protected classification. Developer will take affirmative action to insure that
the evaluation and treatment of employees ate free from such discrimination. Developer,
unless exempt, further agrees to abide by the terms of all applicable Federal,
state and local non-discrimination provisions, including but not limited to 41
CFR Sec. 60-1.4, such non-discrimination provisions being incorporated herein
by reference. Developer shall include this non-discrimination clause in all
contracts and subcontracts to perform work under this Agreement and will notify
all labor organizations with which it has a collective bargaining agreements of
the obligations hereunder.

 

28.           Waiver of Jury Trial. Developer and Owner
each hereby waives trial by jury in any action arising out of matters related
to this Agreement, which waiver is informed and voluntary.

 

29.           Dispute Resolution. The parties hereto
have agreed to submit disputes to mandatory arbitration in accordance with the
provisions of this Section 29. Each party waives the right to commence an
action in connection with this Agreement in any court and expressly agrees to
be bound by the decision of the arbitrator determined in this Section 29;
provided, however, the waiver in this Section 29 will not prevent the other
party from commencing an action in any court for the sole purposes of enforcing
the obligation of the other party to submit to binding arbitration or the
enforcement of an award granted by arbitration herein. Notwithstanding the
foregoing, prior to submitting any dispute hereunder to arbitration, each party
shall first attempt in good faith, for thirty (30) days after the first notice
given under this Agreement regarding such dispute, to resolve any such dispute
promptly by negotiation between executives of each party who have authority to
settle the dispute, which shall include an in-person meeting between such
executives in Dallas, Texas.

 

(a)           Any dispute between
the parties as to the interpretation of any provision of this Agreement or the
rights and obligations of any party hereunder shall be resolved through binding
arbitration as hereinafter provided in Dallas, Texas. Upon agreement between
Owner and Developer, other parties may be made a party to the arbitration
proceeding.

 

(b)           If arbitration is
required to resolve a dispute between the parties, a panel of three (3)
arbitrators shall be convened. Each party hereto shall each select one (1)
arbitrator with at least five (5) years experience in commercial real estate in
general and the operation of property similar to the Project in particular, and
those two (2) arbitrators shall by agreement select a third

 

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arbitrator having recognized expertise and at
least five (5) years experience in commercial real estate in general and the
operation of property similar to the Project in particular.

 

(c)           The arbitrators
selected pursuant to Section 29(b) above will establish the rules for proceeding
with the arbitration of the dispute, which will be binding upon all parties to
the arbitration proceeding. The arbitrators may use the rules of the American
Arbitration Association for commercial arbitration but are encouraged to adopt
the rules the arbitrators deem appropriate to accomplish the arbitration in the
quickest and least expensive manner possible. Accordingly, the arbitrators may
(i) dispense with any formal rules of evidence and allow hearsay testimony
so as to limit the number of witnesses required, (ii) minimize discovery
procedures as the arbitrators deem appropriate, (iii) limit the time for
presentation of any party’s case as well as the amount of information or number
of witnesses to be presented in connection with any hearing, and
(iv) impose any other rules which the arbitrators believe appropriate to
effect a resolution of the dispute as quickly and inexpensively as possible. In
any event, the arbitrators (A) shall permit each side no more than two (2)
depositions (including any deposition of experts), which depositions may not
exceed four (4) hours each, one set of 10 interrogatories (inclusive of
sub-parts) and one set of five (5) document requests (inclusive of sub-parts);
(B) shall not permit any requests for admissions; (C) shall limit the hearing,
if any, to two (2) days; and (D) shall render their decision within sixty (60)
days of the filing of the arbitration.

 

(d)           The arbitrators will
have the exclusive authority to determine and award costs of arbitration and
the costs incurred by any party for its attorneys, advisors and consultants.

 

(e)           Any award made by the
arbitrators shall be binding on the parties and all parties to the arbitration
and shall be enforceable to the fullest extent of the law.

 

(f)            In reaching any determination
or award, the arbitrators will apply the laws of the state of Texas. Except as
permitted under Section 29(d) above, the arbitrators’ award will be limited to
actual damages and will not include consequential, special, punitive or
exemplary damages. Nothing. contained in this Agreement will be deemed to give
the arbitrators any authority, power or right to alter, change, amend, modify,
add to or subtract from any of the provisions of this Agreement. All privileges
under state and federal law, including, without limitation, attorney-client,
work product and party communication privileges, shall be preserved and
protected. All experts engaged by a party must be disclosed to the other party
within fourteen (14) days after the date of notice and demand for arbitration
is given.

 

(g)           Notwithstanding any
provision of this Agreement to the contrary, any party may seek injunctive
relief or other form of ancillary relief at any time from any court of
competent jurisdiction in Dallas County, Texas. In the event that a dispute or
controversy requires emergency relief before the matter may be resolved under
the arbitration procedures of this Section 29, notwithstanding the fact that
any court of competent jurisdiction may enter an order providing for injunctive
or other form of ancillary relief, the parties expressly agree that such
arbitration procedures will still govern the ultimate resolution of that
portion of the dispute or controversy not resolved pursuant to said court
order.

 

[Signature
Page Follows]

 

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Executed effective as of the date written above.

 

	
   

  	
  OWNER:

  
	
   

  	
   

  
	
   

  	
  BEHRINGER HARVARD
  FRISCO SQUARE LLC,

  a Delaware limited liability company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Gerald J. Reihsen, III

  	
   

  
	
   

  	
   

  	
  Gerald J. Reihsen, III

  
	
   

  	
   

  	
  Executive Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
  15601 Dallas Parkway,
  Suite 600

  
	
   

  	
   

  	
  Addison, Texas 75001

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  DEVELOPER:

  
	
   

  	
   

  
	
   

  	
  FRISCO SQUARE
  DEVELOPMENT, LTD.,

  
	
   

  	
  a Texas limited
  partnership

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Fairway FS Development,
  LLC,

  
	
   

  	
   

  	
  a Texas limited liability
  company

  
	
   

  	
   

  	
  General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ James Leslie

  	
   

  
	
   

  	
   

  	
  Name:

  	
  James Leslie

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Mgr of GP

  	
   

  
									

 

	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
  16250 Dallas Parkway,
  Suite 102

  
	
   

  	
   

  	
  Dallas, Texas 75248

  

 

 

Exhibit A

 

Legal Description

 

BHFS I, LLC PROPERTIES:

 

TRACT 1:

 

BEING
a tract of land situated in the W. B. Watkins Survey Abstract No. 1004, in the
City of Frisco, Collin County, Texas; said tract being part of land conveyed to
Frisco Square Ltd. as recorded in Collin County Clerk’s File No. 2005-004994
Deed Records Collin County, Texas (DRCCT); and being more particularly
described as follows:

 

BEGINNING
at a 1/2” iron rod found for corner at the north end of a corner clip at the
intersection of the east line of Dallas North Tollway (a 310 ft. right-of-way)
with the south line of Main Street (a variable width right-of-way as recorded
in Collin County Clerk’s File No. 2005-0071194 DRCCT;

 

THENCE North 86°07’47” East, along the south
line of said Main Street, for a distance of 3 9.33 feet to a 1/2” iron rod for
corner on the south line of a 24 ft. wide strip of land conveyed to the City of
Frisco as recorded in Collin County Clerk’s File No. 2000-0081361 DRCCT;

 

THENCE
along the south line of said City of Frisco tract with a circular curve to the
left having a central angle of 02°34’14”, a radius of 5,793.61 feet, a tangent
length of 129.98 feet, and a chord of North 87°01’27” East 259.90 feet, for an
arc distance of 259.92 feet to a 1/2” iron rod found at said curve’s point of
tangency;

 

THENCE
North 85°44’20” East, continuing along said south line, for a distance of 8.48
feet to a 1/2” iron rod found for corner;

 

THENCE
North 86°07’47” East, continuing along said south line, continuing along said
south line for a distance of 776.11 ft. to a 1/2” iron rod found for corner on
the west line of Lot Bl-10 of Frisco Square Phase 2 as conveyed to the City of
Frisco and recorded in Cabinet P, Page 724 DRCCT;

 

THENCE
South 03°52’13” East, departing said south line and along the west line of said
City of Frisco tract, for a distance of 99.38 ft. to a 1/2” iron rod found for
corner;

 

THENCE
South 83°23’44” West, along a north line of said Frisco tract, for a distance
of 184.15 ft. to a 1/2” iron rod found for corner;

 

THENCE
South 06°36’16” East, along a west line of said Frisco tract, for a distance of
67.00 ft. to a 1/2” iron rod found for corner;

 

THENCE
South 83°23’44” West, along a north line of said Frisco tract, for a distance
of 105.76 ft. to a 1/2” iron rod found for corner;

 

THENCE
South 06°36’16” East, along a west line of said Frisco tract, for a distance of
246.50 ft. to a 1/2” iron rod found for corner;

 

1

 

THENCE
North 83°23’44” East, along a south line of said Frisco tract, for a distance
of 57.76 ft. to a 1/2” iron rod found for corner;

 

THENCE
South 06°36’16” East, along a west line of said Frisco tract, for a distance of
111.50 ft. to a 1/2” iron rod found for corner;

 

THENCE
North 83°23’44” East, along a south line of said Frisco tract, for a distance
of 62.41 ft. to a 1/2” iron rod found for corner at the northwest corner of
future Lot Bl-8 per deed to Frisco Square Properties, Ltd. as recorded in
Collin County Clerk’s File No. 2003-0213220 DRCCT;

 

THENCE
South 06°36’16” East, along the west line of said future Lot Bl-8, for a
distance of 87.25 ft. to a 1/2” iron rod found for corner;

 

THENCE
South 83°23’44” West, continuing along said west line, for a distance of 25.33
ft. to a 1/2” iron rod found for corner;

 

THENCE
South 06°36’16” East, continuing along said west line, for a distance of 81.75
ft. to a 1/2” iron rod found for corner on the north line of Frisco Square
Blvd. (recorded as W. Main St.) per the Conveyance Plat recorded in Cabinet N,
Page 690 DRCCT;

 

THENCE
South 83°23’44” West, along said north line, for a distance of 902.58 ft. to a
1/2” iron rod found for corner at the southeast end of a corner clip at the
intersection of said north line with the east line of said Dallas North
Tollway;

 

THENCE
North 51°36’16” West, along said corner clip, for a distance of 28.28 ft. to a
1/2” iron rod found for corner on the east line of said Dallas North Tollway
and at the northwest end of said corner clip;

 

THENCE
North 06°36’16” West, along said east line, for a distance of 689.45 to a 1/2”
iron rod found for corner;

 

THENCE
North 38°46’11” East, along the corner clip at the intersection of said east
line with the south line of said Main Street, for a distance of 56.24 feet to
the POINT OF BEGINNING and containing 15.24 90 acres of land.

 

TRACT 2:

 

BEING
a tract of land situated in the W.B. Watkins Survey Abstract No. 1004, in the
City of Frisco, Collin County, Texas; said tract being part of land conveyed to
Frisco Square Land, Ltd. as recorded in Collin County Clerk’s (C.C.) File No.
2005-004 994 Deed Records Collin County, Texas (DRCCT); and being more
particularly described as

 

follows:

 

BEGINNING
at a 1/2” iron rod found for corner at the north end of a corner clip at the
intersection of the east line of Dallas North Tollway (a 310 ft. right-of-way)
with the south line of Frisco Square Blvd. (recorded as W. Main St.)(a 73 ft.
right-of-way) per the Conveyance Plat recorded in Cabinet N Page 690 DRCCT;

 

THENCE
North 83°23’44” East, along said south line, for a distance of 978.97 ft. to a
1⁄2” iron rod found for corner;

 

2

 

THENCE
North 06°36’16” West, continuing along said south line, for a distance of 12.00
ft. to a 1⁄2” iron rod found for corner;

 

THENCE
North 83°23’44” East, continuing along said south line, for a distance of 30.00
ft. to a 1⁄2” iron rod found for corner at the intersection of said south line
with the west line of Church Street (a 121 ft. right-of-way) as recorded in
Cabinet N Page 690 DRCCT;

 

THENCE
South 06°36’16” East, along said west line, for a distance of 539.00 ft. to a 1⁄2”
iron rod found for corner at the intersection of said west line with the north
line of Page Street (a 67 ft. right-of-way) as recorded in Cabinet N Page 690
DRCCT and in C.C. No. 2006-955330 DRCCT;

 

THENCE
South 83°23’44” West, along the said north line of Page Street, for a distance
of 1,008.97 ft. to a 1⁄2” iron rod found for corner at the south end of a corner
clip at the intersection of said north line with the east line of said Dallas
North Tollway;

 

THENCE
North 51°36’16” West, along said corner clip, for a distance of 28.28 ft. to a
1⁄2” iron rod found for corner on the east line of said Dallas North Tollway;

 

THENCE
North 06°36’16” West, along said east line, for a distance of 487.00 ft. to a 1⁄2”
iron rod found for corner at the southwest end of a corner clip at the
intersection of said east line with the south line of said Frisco Square Blvd.;

 

THENCE
North 38°23’44” East, along said corner clip, for a distance of 28.28 ft. to
the POINT OF BEGINNING and containing 12.4478 acres of land SAVE AND EXCEPT THE
FOLLOWING DESCRIBED TRACT:

 

SAVE AND EXCEPT FROM TRACT 2:

 

BEING
a tract of land situated in the W.B. Watkins Survey Abstract No. 1004, in the
City of Frisco, Collin County, Texas; said tract being part of land conveyed to
Frisco Square Land, Ltd. as recorded in Collin County Clerk’s (C.C.) File No.
2005-004 994 Deed Records Collin County, Texas (DRCCT); and being more
particularly described as follows:

 

BEGINNING
at a 1/2” iron rod found for corner at the north end of a corner clip at the
intersection of the east line of Dallas North Tollway, with the north line of
Page Street (a 67 ft. right-of-way) as recorded in Cabinet N Page 690 DRCCT and
in C.C. No. 2006-955330 DRCCT;

 

THENCE
North 06°36’16”, along said east line, for a distance of 171.00 ft. to a point
for corner;

 

THENCE
North 83°23’44” East, departing said east line, for a distance of 220.50 ft. to
a point for corner;

 

THENCE
South 06°36’16” East, for a distance of 191.00 ft. to a point for corner on the
north line of said Page Street;

 

THENCE
South 83°23’44” West, along said north line, for a distance of 200.50 ft. to a
1/2” iron rod found for corner at the south end of a corner clip at the
intersection of said north line with the east line of said Dallas North
Tollway;

 

THENCE
North 51°36’16” West, along said corner clip, for a distance of 28.28 ft. to
the POINT OF BEGINNING and containing 0.9622 acres of land.

 

LEAVING
A NET AREA OF 11.4856 ACRES OF LAND FOR TRACT 2.

 

3

 

TRACT 3 (SHOWN ON SURVEY [PREPARED BY RUDY RANGEL, R.P.L.S.
NO. 5664, DATED 07/12/07] AS TRACT
4A):

 

BEING
a tract of land situated in the W.B. Watkins Survey Abstract No. 1004, in the
City of Frisco, Collin County, Texas; said tract being part of a tract conveyed
to Frisco Square Land, Ltd., as recorded in Collin County Clerk’s (C.C.) File
No. 2005-004994 Deed Records Collin County, Texas (DRCCT), and being more
particularly described as follows:

 

BEGINNING
at a 1/2” iron rod found for corner at the intersection of the south line of a
24 ft. wide strip of land conveyed to the City of Frisco as recorded in Collin
County Clerk’s File No. 2000-0081361 DRCCT with the east line of Lot Fl-9 of
Frisco Square Phase 2 as recorded in Cabinet P Page 724 DRCCT, said Lot Fl-9 as
conveyed to the City of Frisco per said Frisco Square Phase 2 final plat;

 

THENCE
North 86°07’47” East, along the south line of said City of Frisco 24 ft. wide
strip of land, for a distance of 162.14 ft. to a 1/2” iron rod found for corner
and for the beginning of a circular curve to the right;

 

THENCE
continuing along said south line, with said circular curve to the right having
a central angle of 15°46’18”, a radius of 2,608.02 ft., a tangent length of
361.23 ft., and a chord of South 85°59’04” East 715.63 ft., for an arc distance
of 717.90 ft. to a 1/2” iron rod found for corner and for a point of tangency;

 

THENCE
South 78°05’56” East, continuing along said south line, for a distance of 162.10
ft. to a 1/2” iron rod found for corner at the intersection of said south line
with the west line of John W. Elliot Drive (a 60 ft. right-of-way);

 

THENCE
South 12°16’44” West, along said west line, for a distance of 500.65 ft. to a
1/2” iron rod found for corner at the intersection of said west line with the
north line of Frisco Square Blvd. as recorded in C.C. No. 2006-955350 DRCCT;

 

THENCE
South 83°23’44” West, along said north line, for a distance of 657.91 feet to a
1/2” iron rod found for corner at the southeast corner of a tract conveyed to
Frisco Square Properties, Ltd. as Future Lot Fl-8, as recorded in C.C. No.
2003-0213220 DRCCT;

 

THENCE
North 06°36’16” West, departing said north line, and along the east line of
said future Lot Fl-8, for a distance of 81.75 ft. to a 1/2” iron rod found for
corner;

 

THENCE
South 83°23’44” West, continuing along said east line, for a distance of 25.33
ft. to a 1/2” iron rod found for corner;

 

THENCE
North 06°36’16” West, continuing along said east line, for a distance of 87.25
ft. to a 1/2” iron rod found for corner on a south line of said City of Frisco
Lot Fl-9;

 

THENCE
North 83°23’44” East, along said south line, for a distance of 15.91 ft. to a
1/2” iron rod found for corner;

 

THENCE
North 06°36’16” West, along an east line of said Lot Fl-9, for a distance of
58.99 ft. to a 1/2” iron rod found for corner;

 

THENCE
North 83°23’44” East, along a south line of said Lot Fl-9, for a distance of
209.26 ft. to a 1/2” iron rod found for corner;

 

4

 

THENCE
North 06°36’16” West, along an east line of said Lot Fl-9, for a distance of 24
9.00 ft. to a 1/2” iron rod found for corner;

 

THENCE
South 83°23’44” West, along a north line of said Lot Fl-9, for a distance of
252.44 ft. to a 1/2” iron rod found for corner;

 

THENCE
North 03°52’13” East, along an east line of said Lot Fl-9, for a distance of
84.59 ft. to a 1/2” iron rod found for corner;

 

THENCE
South 86°07’47” West, along a north line of said Lot Fl-9, for a distance of 155.29
ft. to a 1/2” iron rod found for corner;

 

THENCE
North 03°52’13” East, along an east line of said Lot Fl-9, for a distance of
96.00 ft. to the POINT OF BEGINNING and containing 9.5992 acres of land.

 

BHFS II,
LLC PROPERTIES:

 

Tract 1 (SHOWN ON SURVEY [PREPARED BY RUDY RANGEL, R.P.L.S.
NO. 5664, DATED 07/12/07 AND AS SHOWN ON SURVEY PREPARED BY DANA BROWN R.P.L.S.
#5336, DATED 06/27/07, LAST REVISED 07/10/07 AS TRACT 12):

 

BEING
a tract of land situated in the W.B. Watkins Survey, Abstract No. 1004, Collin
County, Texas, and being all of Lot Bl-7, Block B-l, Frisco Square Phase 2, an
addition to the City of Frisco, Texas recorded in Cabinet P, Page 724, Map
Records, Collin County, Texas, and being more particularly described as
follows:

 

BEGINNING
at an X-cut set in concrete at the southeast corner of said Lot Bl-7 at the
intersection of the west Right-of-Way line of Coleman Boulevard (114’
Right-of-Way) and the north Right-of-Way line of Frisco Square Boulevard (70.5’
Right-of-Way) as dedicated to the City of Frisco recorded in Cabinet N, Page
690, Map Records, Collin County, Texas;

 

THENCE
with the north Right-of-Way line of said Frisco Square Boulevard the following
calls:

 

South
82°20’57” West a distance of 23.08 feet to an X-cut set in concrete for corner;
North 07°3 9’03” West a distance of 2.50 feet to an X-cut set in concrete for
corner;

 

South
82°20’57” West a distance of 67.33 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
07°39’03” East a distance of 2.50 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
82°20’57” West a distance of 19.33 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
07°39’03” West a distance of 2.50 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

5

 

South
82°20’57” West a distance of 29.25 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
07°39’03” East a distance of 2.50 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
82°20’57” West a distance of 25.28 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
07°3 9’03” West a distance of 2.50 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
82°20’57” West a distance of 31.85 feet to a 5/8” iron rod with red cap marked
KHA set for corner in the east line of future Lot 8, Block B-l;

 

THENCE
North 07°39’03” West with the east line of said future Lot 8, Block B-l a
distance of 81.75 feet to a 5/8” iron rod with red cap marked KHA set for
corner;

 

THENCE
departing the east line of said future Lot 8, Block B-l and with the north line
of said Lot Bl -7 the following calls:

 

North
82°20’57” East a distance of 17.08 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
07°39’03” East a distance of 0.75 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
82°20’57” East a distance of 14.77 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
07°39’03” West a distance of 1.50 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
82°20’57” East a distance of 25.28 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
07°39’03” East a distance of 1.50 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
82°20’57” East a distance of 15.19 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
07°39’03” West a distance of 0.75 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
82°20’57” East a distance of 17.34 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
07°39’03” East a distance of 0.75 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
82°20’57” East a distance of 12.20 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

6

 

North
37°20’57” East a distance of 10.61 feet to an X-cut set in concrete for corner;
North 07°3 9’03” West a distance of 23.75 feet to an X-cut set in concrete for
corner;

 

North
82°20’57” East a distance of 82.75 feet to an X-cut set in concrete for corner
in the west Right-of-Way line of said Coleman Boulevard;

 

THENCE
with the west Right-of-Way line of said Coleman Boulevard the following calls:
South 07°3 9’03” East a distance of 91.13 feet to an X-cut set in concrete for
corner; North 82°20’57” East a distance of 4.00 feet to an X-cut set in
concrete for corner;

 

South
07°39’03” East a distance of 23.62 feet to the POINT OF BEGINNING and
containing 0.424 5 acres of land.

 

Tract 2 (SHOWN ON SURVEY [PREPARED BY RUDY RANGEL, R.P.L.S.
NO. 5664, DATED 07/12/07 AND AS SHOWN ON SURVEY PREPARED BY DANA BROWN R.P.L.S.
#5336, DATED 06/27/07, LAST REVISED 07/10/07AS TRACT 13):

 

BEING
a tract of land situated in the W.B. Watkins Survey, Abstract No. 1004, Collin
County, Texas, and being all of Lot Fl-10, Block F-l, Frisco Square Phase 2, an
addition to the City of Frisco, Texas recorded in Cabinet P, Page 724, Map
Records, Collin County, Texas, and being more particularly described as
follows:

 

BEGINNING
at an X-cut set in concrete at the southeast corner of said Lot Fl-10 at the
intersection of the east Right-of-Way line of Coleman Boulevard (114’
Right-of-Way) and the north Right-of-Way line of Frisco Square Boulevard (70.5’
Right-of-Way) as dedicated to the City of Frisco recorded in Cabinet N, Page
690, Map Records, Collin County, Texas,-

 

THENCE
with the east Right-of-Way line of said Coleman Boulevard the following calls:
North 07°39’03” West a distance of 23.62 feet to an X-cut set in concrete for
corner; North 82°20’57” East a distance of 4.00 feet to an X-cut set in
concrete for corner;

 

North
07°39’03” West a distance of 91.13 feet to an X-cut set in concrete at the
northwest corner of said Lot Fl-10;

 

THENCE
with north line of said Lot Fl-10 the following calls:

 

North
82°20’57” East a distance of 82.75 feet to an X-cut set in concrete for corner;

 

South
07°3 9’03” East a distance of 23.75 feet to an X-cut set in concrete for
corner;

 

South
52°39’03” East a distance of 10.61 feet to an X-cut set in concrete for corner;

 

7

 

North
82°20’57” East a distance of 12.20 feet to an X-cut set in concrete for corner;

 

North
07°39’03” West a distance of 0.75 feet to an X-cut set in concrete for corner;

 

North
82°20’57” East a distance of 17.34 feet to an X-cut set in concrete for corner;

 

South
07°39’03” East a distance of 0.75 feet to an X-cut set in concrete for corner;

 

North
82°20’57” East a distance of 15.19 feet to an X-cut set in concrete for corner;

 

North
07°3 9’03” West a distance of 1.50 feet to an X-cut set in concrete for corner;

 

North
82°20’57” East a distance of 25.28 feet to an X-cut set in concrete for corner;

 

South
07°39’03” East a distance of 1.50 feet to an X-cut set in concrete for corner;

 

North
82°20’57” East a distance of 14.77 feet to an X-cut set in concrete for corner;
North 07°3 9’03” West a distance of 0.75 feet to an X-cut set in concrete for
corner;

 

North
82°20’57” East a distance of 17.08 feet to an X-cut set in concrete for corner
in the west line of future Lot 8, Block F-l;

 

THENCE
South 07°39’03” East with the west line of said future Lot 8, Block F-l a
distance of 81.75 feet to a pk nail set in concrete for corner in the north
Right-of-Way line of said Frisco Square Boulevard;

 

THENCE
with the north Right-of-Way line of said Frisco Square Boulevard the following
calls:

 

South
82°20’57” West a distance of 31.85 feet to a point for corner,-South 07°3 9’03”
East a distance of 2.50 feet to an X-cut set in concrete for corner; South
82°20’57” West a distance of 25.28 feet to an X-cut set in concrete for corner;
North 07°39’03” West a distance of 2.50 feet to an X-cut set in concrete for
corner; South 82°20’57” West a distance of 29.25 feet to an X-cut set in concrete
for corner; South 07°39’03” East a distance of 2.50 feet to an X-cut set in
concrete for corner; South 82°20’57” West a distance of 19.33 feet to an X-cut
set in concrete for corner; North 07°39’03” West a distance of 2.50 feet to an
X-cut set in concrete for corner; South 

 

8

 

82°20’57”
West a distance of 67.33 feet to X-cut set in concrete for corner; South 07°39’03”
East a distance of 2.50 feet to X-cut set in concrete for corner;

 

South
82°20’57” West a distance of 23.08 feet to the POINT OF BEGINNING and
containing 0.4245 acre of land.

 

BHFS III,
LLC PROPERTY:

 

BEING
a tract of land situated in the W.B. Watkins Survey, Abstract No. 1004, Collin
County, Texas, and being all of Lot Fl-1, Block F-l, Frisco Square Phase 2, an
addition to the City of Frisco, Texas recorded in Cabinet P, Page 724, Map
Records, Collin County, Texas, and being more particularly described as
follows:

 

BEGINNING
at a 5/8” iron rod with red cap marked KHA set at the corner clip intersection
of the south Right-of-Way line of Main Street (variable width Right-of-Way) and
the most easterly northeast corner of Coleman Boulevard (114’ Right-of-Way) as
dedicated to the City of Frisco recorded in Cabinet N, Page 690, Map Records,
Collin County, Texas;

 

THENCE
North 85°05’00” East with the south Right-of-Way line of said Main Street a
distance of 190.04 feet to a 5/8” iron rod with red cap marked KHA set for
corner;

 

THENCE
South 04°55’00” East departing the south Right-of-Way line of said Main Street
a distance of 96.67 feet to a 5/8” iron rod with red cap marked KHA set for
corner, said point being an inner ell corner in the north line of Lot Fl-11 of
said Frisco Square Phase 2;

 

THENCE
with the north line of said Lot Fl-11 the following calls:

 

South
85°05’00” West a distance of 112.09 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
07°39’03” East a distance of 14.21 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
82°20’57” West a distance of 85.74 feet to a 5/8” iron rod with red cap marked
KHA set for corner in the east Right-of-Way line of said Coleman Boulevard;

 

THENCE
with the east Right-of-Way line of said Coleman Boulevard the following calls:

 

North
07°39’03” West a distance of 102.58 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
38°42’59” East a distance of 17.25 feet to the POINT OF BEGINNING and
containing 0.4746 acre of land.

 

9

 

BHFS IV,
LLC PROPERTIES:

 

Tract 1 (SHOWN ON SURVEY [PREPARED BY DANA BROWN R.P.L.S.
#5336, DATED 06/27/07, LAST REVISED 07/10/07] AS TRACT 8):

 

BEING a tract of land situated
in the W.B. Watkins Survey, Abstract No. 1004, Collin County, Texas, and being
all of Lot Bl-5, Block B-l, Frisco Square Phase 2, an addition to the City of
Frisco, Texas recorded in Cabinet P, Page 724, Map Records, Collin County,
Texas, and being more particularly described as follows:

 

BEGINNING
at a 5/8” iron rod with red cap marked KHA set at the corner clip intersection
of the south Right-of-Way line of Main Street (variable width Right-of-Way) and
the most westerly northwest corner of Coleman Boulevard (114’ Right-of-Way) as
dedicated to the City of Frisco recorded in Cabinet N, Page 690, Map Records,
Collin County, Texas;

 

THENCE
with the west Right-of-Way line of said Coleman Boulevard the following calls:

 

South
51°17’01” East a distance of 18.09 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
07°39’03” East a distance of 108.03 feet to a 5/8” iron rod with red cap marked
KHA set for corner from which a 1/2” iron rod found bears South 22°06’46” East
a distance of 0.60 feet;

 

THENCE
departing the west Right-of-Way line of said Coleman Boulevard the following
calls:

 

South
82°20’57” West a distance of 85.74 feet to a 5/8” iron rod with red cap marked
KHA set for corner from which a 1/2” iron rod found bears South 47°57’00” East
a distance of 1.34 feet;

 

North
07°39’03” West a distance of 24.51 feet to a 1/2” iron rod found for corner;

 

South
85°05’00” West a distance of 120.62 feet to a 5/8” iron rod with red cap marked
KHA set for corner,-

 

North
04°55’00” West a distance of 100.00 feet to a 5/8” iron rod with red cap marked
KHA set for corner in the south Right-of-Way line of said Main Street;

 

THENCE
North 85°05’00” East with the south Right-of-Way line of said Main Street a
distance of 189.18 feet to the POINT OF BEGINNING and containing 0.5109 acre of
land.

 

Tract 2 (SHOWN ON SURVEY PREPARED BY DANA BROWN R.P.L.S.
#5336, DATED 06/27/07, LAST REVISED 07/10/07] AS TRACT 9):

 

BEING
a tract of land situated in the W.B. Watkins Survey, Abstract No. 1004, Collin
County, Texas, and being part of a tract of land described in a deed to Frisco
Square, Ltd. recorded in Volume 4721, Page 2560, Land Records, Collin County,
Texas, and being more particularly described as follows:

 

BEGINNING
at 5/8” iron rod with red cap marked KHA set at the southwest corner of Lot
Bl-7, Block Bl, Frisco Square Phase 2, an addition to the City of Frisco, Texas
recorded in Cabinet P, Page 724, Map Records, Collin County, Texas, said point
being in the north Right-of-Way line of Frisco Square Boulevard (70.5’
Right-of-Way) as dedicated to the City of Frisco recorded in Cabinet N, Page
690, Map Records, Collin County, Texas;

 

THENCE
with the north Right-of-Way line of said Frisco Square Boulevard the following

 

10

 

calls:

 

South
82°20’57” West a distance of 100.05 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
37°20’57” West a distance of 59.54 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
07°3 9’03” East a distance of 57.90 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
82°20’57” West a distance of 30.00 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
07°39’03” West a distance of 12.00 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
82°20’57” West a distance of 76.39 feet to a 1/2” iron rod with cap found for
corner;

 

THENCE
departing the north Right-of-Way line of said Frisco Square Boulevard the
following calls:

 

North
07°3 9’03” West a distance of 81.75 feet to a 1/2” iron rod with cap found for
corner;

 

North
82°20’57” East a distance of 25.33 feet to a 1/2” iron rod with cap found for
corner;

 

North
07°39’03” West a distance of 87.25 feet to a 1/2” iron rod with cap found for
corner in the south line of Lot Bl-10, Lot Bl of said Frisco Square Phase 2,
from which a 5/8” iron rod found bears South 78°45’27” West a distance of 2.23
feet;

 

THENCE
North 82°20’57” East with the south line of said Lot Bl-10 a distance of 223.21
feet to a 5/8” iron rod with red cap marked KHA set for corner in the west line
of said Lot Bl-7;

 

THENCE
South 07°3 9’03” East with the west line of said Lot Bl -7 a distance of 81.00
feet to the POINT OF BEGINNING and containing 0.6550 acres of land.

 

Tract 3 (SHOWN ON SURVEY PREPARED BY DANA BROWN R.P.L.S.
#5336, DATED 06/27/07, LAST REVISED 07/10/07] AS TRACT 10):

 

BEING
a tract of land situated in the W.B. Watkins Survey, Abstract No. 1004, Collin
County, Texas, and being part of a tract of land described in a deed to Frisco
Square, Ltd. recorded in Volume 4721, Page 2560, Land Records, Collin County,
Texas, and being more particularly described as follows:

 

BEGINNING
at 5/8” iron rod with red cap marked KHA set at the intersection the north
Right-of-Way line of Frisco Square Boulevard (70.5’ Right-of-Way) and the east
Right-of-Way line of Library Street (variable width Right-of-Way) as dedicated
to the City of Frisco recorded in Cabinet N, Page 690, Map Records, Collin
County, Texas;

 

THENCE
with the northeast Right-of-Way line of said Frisco Square Boulevard the
following calls:

 

11

 

North
07°39’03” West a distance of 57.90 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

North
52°39’03” West a distance of 59.54 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
82°20’57” West a distance of 100.05 feet to a PK nail set in concrete for
corner in the east line of Lot Fl-10, Lot Fl, Frisco Square Phase 2, an
addition to the City of Frisco, Texas recorded in Cabinet P, Page 724, Map
Records, Collin County, Texas;

 

THENCE
North 07°39’03” West with the east line of said Lot Fl-10 a distance of 81.00
feet to an X-cut in concrete set for corner in the south line of Lot Fl-9, Lot
Fl, of said Frisco Square Phase 2;

 

THENCE
North 82°20’57” East with the south line of said Lot Fl-9 a distance of 223.21
feet to a 1/2” iron rod with cap found for corner;

 

THENCE
South 07°3 9’03” East a distance of 87.25 feet to a 1/2” iron rod with cap
found for corner;

 

THENCE
North 82°20’57” East a distance of 25.33 feet to a 1/2” iron rod with cap found
for corner;

 

THENCE
South 07°39’03” East a distance of 81.75 feet to a 1/2” iron rod with cap found
for corner in the north Right-of-Way line of said Frisco Square Boulevard;

 

THENCE
with the north Right-of-Way line of said Frisco Square Boulevard the following
calls:

 

South
82°20’57” West a distance of 76.39 feet to a 1/2” iron rod with cap found for
corner;

 

South
07°39’03” East a distance of 12.00 feet to a 5/8” iron rod with red cap marked
KHA set for corner;

 

South
82°20’57” West a distance of 30.00 feet to the POINT OF BEGINNING and containing
0.6550 acres of land.

 

Tract 4 (SHOWN ON SURVEY [PREPARED BY DANA BROWN R.P.L.S.
#5336, DATED 06/27/07, LAST REVISED 07/10/07] AS TRACT 11/LOT Fl-11):

 

BEING
a tract of land situated in the W.B. Watkins Survey, Abstract No. 1004, Collin
County, Texas, and being all of Lot Fl-11, Block F-l, Frisco Square Phase 2, an
addition to the City of Frisco, Texas recorded in Cabinet P, Page 724, Map
Records, Collin County, Texas, and being more particularly described as
follows:

 

BEGINNING
at an X-cut set in concrete at the northwest corner of said Lot Fl-11 in the
east Right-of-Way line of Coleman Boulevard (114’ Right-of-Way) as dedicated to
the City of Frisco recorded in Cabinet N, Page 690, Map Records, Collin County,
Texas;

 

THENCE
North 82°20’57” East a distance of 82.97 feet to an X-cut set in concrete for
corner;

 

THENCE
South 07°39’03” East a distance of 5.50 feet to an X-cut set in concrete for
corner;

 

THENCE
North 82°20’57” East a distance of 71.70 feet to a 5/8” iron rod with red cap
marked KHA set for corner;

 

12

 

THENCE
South 07°39’03” East a distance of 280.50 feet to a 5/8” iron rod with red cap
marked KHA set for corner;

 

THENCE
South 82°20’57” West a distance of 71.70 feet to an X-cut set in concrete for
corner;

 

THENCE
South 07°39’03” East a distance of 4.84 feet to an X-cut set in concrete for
corner;

 

THENCE
South 82°20’57” West a distance of 82.97 feet to an X-cut set in concrete for
corner in the east Right-of-Way line of said Coleman Boulevard;

 

THENCE
North 07°39’03” West with the east Right-of-Way line of said Coleman Boulevard
a distance of 290.84 feet to the POINT OF BEGINNING and containing 1.0157 acres
of land.

 

Tract 5 (SHOWN ON SURVEY [PREPARED BY DANA BROWN R.P.L.S.
#5336, DATED 06/27/07, LAST REVISED 07/10/07] AS TRACT 11 / LOT Bl-6):

 

BEING
a tract of land situated in the W.B. Watkins Survey, Abstract No. 1004, Collin
County, Texas, and being all of Lot Bl-6, Block. B-l, Frisco Square Phase 2, an
addition to the City of Frisco, Texas recorded in Cabinet P, Page 724, Map
Records, Collin County, Texas, and being more particularly described as
follows:

 

BEGINNING
at an X-cut set in concrete at the northeast corner of said Lot Bl-6 in the
west Right-of-Way line of Coleman Boulevard (114’ Right-of-Way) as dedicated to
the City of Frisco recorded in Cabinet N, Page 690, Map Records, Collin County,
Texas;

 

THENCE
South 07°39’03” East with the west Right-of-Way line of said Coleman Boulevard
a distance of 290.84 feet to an X-cut set in concrete for corner;

 

THENCE
South 82°20’57” West departing the west Right-of-Way line of said Coleman
Boulevard a distance of 82.97 feet to an X-cut set in concrete for corner;

 

THENCE
North 07°39’03” West a distance of 4.84 feet to an X-cut set in concrete for corner;

 

THENCE
South 82°20’57” West a distance of 71.70 feet to a 5/8” iron rod with red cap
marked KHA set for corner;

 

THENCE
North 07°39’03” West a distance of 280.50 feet to a 5/8” iron rod with red cap
marked KHA set for corner;

 

THENCE
North 82°20’57” East a distance of 71.70 feet to an X-cut set in concrete for
corner;

 

THENCE
North 07°39’03” West a distance of 5.50 feet to an X-cut set in concrete for
corner;

 

THENCE
North 82°20’57” East a distance of 82.97 feet to the POINT OF BEGINNING and
containing 1.0157 acres of land.

 

13

 

Exhibit B

 

Form of Development Agreement

 

(See
attached)

 

1Exhibit 10.110

 

DEVELOPMENT
AGREEMENT

 

BY
AND BETWEEN

 

BEHRINGER
HARVARD FRISCO SQUARE, LLC,

a Delaware limited liability company

 

(“Owner”)

 

AND

 

FRISCO
SQUARE DEVELOPMENT, LTD.,

a Texas limited partnership

 

(“Developer”)

 

August 3,
2007

 

 

TABLE
OF CONTENTS

 

	
   

  	
   

  	
  Page No.

  
	
   

  	
   

  	
   

  
	
  ARTICLE 1

  	
  PURPOSE

  	
  1

  
	
  ARTICLE 2

  	
  appointment
  and development

  	
  1

  
	
  Section 2.1

  	
  Appointment of Developer as Developer

  	
  1

  
	
  Section 2.2

  	
  Acceptance by Developer

  	
  1

  
	
  Section 2.3

  	
  Pre-Construction Duties

  	
  2

  
	
  Section 2.4

  	
  Design of Subject Phase

  	
  3

  
	
  Section 2.5

  	
  Other Services

  	
  3

  
	
  Section 2.6

  	
  Commencement of Construction

  	
  4

  
	
  Section 2.7

  	
  Administration of Subject Phase

  	
  5

  
	
  Section 2.8

  	
  Limitation on Expenditures

  	
  10

  
	
  Section 2.9

  	
  Employees

  	
  10

  
	
  Section 2.10

  	
  Funds for Construction

  	
  10

  
	
  Section 2.11

  	
  Ownership of Information and Materials

  	
  10

  
	
  Section 2.12

  	
  Hazardous Substances

  	
  11

  
	
  Section 2.13

  	
  Payment for Materials

  	
  11

  
	
  Section 2.14

  	
  Completion

  	
  11

  
	
  ARTICLE 3

  	
  COMPENSATION

  	
  13

  
	
  Section 3.1

  	
  Development Fee

  	
  13

  
	
  Section 3.2

  	
  Adjustment to Development Fee

  	
  13

  
	
  Section 3.3.

  	
  Effect of Change Orders

  	
  14

  
	
  Section 3.4.

  	
  Limited Liability for Cost Overruns and Delays

  	
  14

  
	
  Section 3.4.

  	
  No Other Compensation

  	
  14

  
	
  ARTICLE 4

  	
  INSURANCE
  AND INDEMNITY

  	
  14

  
	
  Section 4.1

  	
  Insurance Requirements

  	
  14

  
	
  Section 4.2

  	
  Indemnity

  	
  15

  
	
  Section 4.3

  	
  Waiver of Subrogation

  	
  15

  
	
  Section 4.4.

  	
  Non-Recourse Liability

  	
  15

  
	
  ARTICLE 5

  	
  TERM AND
  TERMINATION

  	
  16

  
	
  Section 5.1

  	
  Term

  	
  16

  
	
  Section 5.2

  	
  Termination by Owner

  	
  16

  
	
  Section 5.3

  	
  Termination by Developer

  	
  17

  
	
  Section 5.4

  	
  Additional Remedies

  	
  17

  
	
  ARTICLE 6

  	
  DUTIES UPON
  TERMINATION OR EXPIRATION

  	
  17

  
	
  Section 6.1

  	
  Developer’s Duties

  	
  17

  
	
  Section 6.2

  	
  Owner’s Duties

  	
  18

  
	
  ARTICLE 7

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
  18

  
	
  Section 7.1

  	
  Developer’s Representations and Warranties

  	
  18

  
	
  Section 7.2

  	
  Owner’s Representations and Warranties

  	
  19

  
	
  ARTICLE 8

  	
  MISCELLANEOUS
  PROVISIONS

  	
  20

  
	
  Section 8.1

  	
  Notices

  	
  20

  
	
  Section 8.2

  	
  Assignment

  	
  20

  
	
  Section 8.3

  	
  Waiver of Lien Claims

  	
  20

  
	
  Section 8.4

  	
  Lender Requirements

  	
  20

  
								

 

i

 

	
  Section 8.5

  	
  Force Majeure Events

  	
  21

  
	
  Section 8.6

  	
  Governing Law

  	
  21

  
	
  Section 8.7

  	
  Time of Essence

  	
  21

  
	
  Section 8.8

  	
  Compliance Amendments

  	
  21

  
	
  Section 8.9

  	
  Entireties, Beneficiaries

  	
  21

  
	
  Section 8.10

  	
  No Agency

  	
  22

  
	
  Section 8.11

  	
  Attorneys’ Fees

  	
  22

  
	
  Section 8.12

  	
  No Waiver

  	
  22

  
	
  Section 8.13

  	
  Interpretation

  	
  22

  
	
  Section 8.14

  	
  Severability

  	
  22

  
	
  Section 8.15

  	
  Amendments

  	
  22

  
	
  Section 8.16

  	
  Counterparts

  	
  22

  
	
  Section 8.17

  	
  Additional Acts

  	
  22

  
	
  Section 8.18

  	
  Exhibits

  	
  23

  
	
  Section 8.19

  	
  Limitation of Liability

  	
  23

  
	
  Section 8.20

  	
  Confidentiality

  	
  23

  
	
  Section 8.23

  	
  Authority of Developer

  	
  23

  
	
  Section 8.22

  	
  Licenses

  	
  23

  
	
  Section 8.23

  	
  Non-Discrimination Policy

  	
  23

  
	
  Section 8.24

  	
  Waiver of Jury Trial

  	
  24

  
	
  Section 8.25

  	
  Dispute Resolution

  	
  24

  

 

ii

 

DEVELOPMENT
AGREEMENT

 

This Development Agreement (“Agreement”) is made to be effective
as of the 3rd day of August 2007, by and between Behringer
Harvard Frisco Square, LLC, a Delaware limited liability company (“Owner”), and Frisco Square
Development, Ltd., a Texas limited partnership (“Developer”),
as follows:

 

ARTICLE 1

PURPOSE

 

A.                                   Owner
and Manager have executed that certain Master Development Agreement (herein so
called) dated as of August 3, 2007, pursuant to which Owner retained
Manager for the furnishing of planning, development and construction management
services in connection with the development and construction of a mixed use
project on the real property in Collin County, Texas, more particularly
described on Exhibit A  attached hereto (the “Land”). In
the Master Development Agreement, Owner and Manager contemplated that the Land
would be developed in Phases (as such term is defined in the Master Development
Agreement), as determined by Owner, subject to Owner’s decision to proceed with
development of each Phase.

 

B.                                     Pursuant
to the Master Development Agreement, Owner has issued a Notice to Proceed (as
defined in the Master Development Agreement) with respect to Phase 1 (the “Subject
Phase”), a description of which is set forth on Exhibit B
attached hereto and made a part hereof. Therefore, according to the terms of
the Master Development Agreement, Owner and Manager are required to enter into
this Agreement in order to set forth their respective rights and obligations
with respect to the development of such Subject Phase.

 

NOW THEREFORE, for and in consideration of
the premises, the mutual promises and agreements set forth herein and Ten and
No/100 Dollars ($10.00) and other good and valuable consideration, in hand
paid, the receipt and sufficiency of which is hereby acknowledged, the parties
do hereby agree as follows:

 

ARTICLE 2

APPOINTMENT AND
DEVELOPMENT

 

Section 2.1                                      Appointment of Developer as Developer.
Owner hereby appoints Developer as its independent contractor to perform, and
delegates to Developer the right and obligation to supervise and manage, on
behalf and for the account of Owner, all planning, development and construction
management services for the Subject Phase, as required by, and subject to, the
terms and conditions of this Agreement, as well as the preparation of the Final
Development Plan, Final Development Budget and Final Schedule (as each
such term is defined below) and all items related thereto.

 

Section 2.2                                      Acceptance by Developer. Developer
accepts such appointment and agrees to perform such services on behalf of
and for the account of Owner as required by, and subject to, the terms and
conditions of the Master Development Agreement and this Agreement, 

 

1

 

and agrees
to perform such additional duties and responsibilities as are customarily
and reasonably within the scope of such services and are reasonably designated
from time to time by Owner. Developer agrees to use commercially reasonable
efforts in the performance of its duties hereunder, which performance in all
respects and at all times shall be carried out to the same extent and with the
same degree of care and quality as the Developer would exercise in the conduct
of its own affairs if the Developer were the owner of the Subject Phase.
Developer agrees to apply prudent and reasonable business practices in the
performance of its duties hereunder and shall exercise that degree of skill,
competence, quality and professional care rendered by the leading and most
reputable companies performing the same or similar type services for similar projects
in the Frisco, Texas area. Subject to the other provisions of this Agreement,
Developer, on behalf of Owner, shall manage and coordinate the development of
the Subject Phase in accordance with the Final Development Plan, Final Development
Budget and Final Schedule (as each such term is defined below) in
accordance with the standards of professional care applicable to such services.

 

Section 2.3                                      Pre-Construction Duties. The
initial objectives of the parties are to prepare a general development plan for
the Project, cause the preparation of plans and specifications for the Project,
and formulate a budget for the Project.

 

(a)                                  Developer
shall submit to Owner for approval a development plan (the “Development Plan”) for the Subject
Phase setting forth a description of the proposed improvements included in the Subject
Phase, the schedule for preparation of the plans and specifications for
the Subject Phase, and the proposed parameters of agreements with
architectural, engineering, consulting, and general contracting firms. Attached
hereto as Exhibit B is a
conceptual development plan for the Subject Phase that has been approved by
Owner. Based upon the conceptual development plan attached hereto as Exhibit C, within thirty
(30) days of execution of this Agreement, Developer shall prepare and submit
for Owner’s written approval a final Development Plan (the “Final Development Plan”) for the Subject
Phase (such approval not to be unreasonably withheld so long as the Final
Development Plan is consistent with the conceptual development plan attached
hereto as Exhibit C).

 

(b)                                 Developer
shall submit to Owner for approval a development budget (the “Development Budget”) for the Subject
Phase setting forth the hard costs, soft costs, allocated land acquisition
costs and other expenditures anticipated to be incurred in connection with
developing the Subject Phase. Attached hereto as Exhibit D
is a conceptual budget for the Subject Phase that has been approved by Owner. Based
upon the conceptual budget attached hereto as Exhibit D,
within thirty (30) days of execution of this Agreement, Developer shall prepare
and submit for Owner’s written approval a final Development Budget (the “Final Development Budget”) for the Subject
Phase (such approval not to be unreasonably withheld so long as the proposed Final
Development Budget is consistent with the conceptual budget attached hereto as Exhibit D).

 

(c)                                  Developer
shall make recommendations to Owner with respect to the size and configuration
of the Subject Phase and the Project, future growth, permanent 

 

2

 

financing options,
marketing, project execution (architect, contractors, consultants), special
requirements and conditions.

 

(d)                                 Developer
shall develop and finalize operating pro forma income and expense statements
for the Subject Phase and the Project and compute return on investment and
other relative indicators to help determine permanent financing and ownership
strategies.

 

(e)                                  Developer
shall prepare and compile data for the Subject Phase and the Project, including
without limitation, site information, income and expense statements, schedules,
drawings and renderings. Such items shall be delivered to Owner upon request.

 

Section 2.4                                      Design of Subject Phase. Owner, after
consultation with Developer, shall designate an architect (“Architect”) as the architect for the
Subject Phase. Developer shall negotiate the contract with the Architect for
the Subject Phase, which shall be subject to the review and prior written
approval of Owner. The contract with the Architect shall substantially conform with
the form, or in the absence of an actual form, shall substantially conform with
the guidelines and contain such specific provisions as are pre-approved by
Owner. Owner shall enter into the agreement with the Architect in its name. Developer
shall not amend or alter the terms of the Architect’s contract without the
prior written approval of Owner. Developer shall use commercially reasonable
efforts to cause the plans and specifications for the Subject Phase to be
prepared in a timely manner and in accordance with the design criteria and the
Final Development Plan and Final Development Budget for the Subject Phase. The
final plans and specifications for the Subject Phase shall be approved in
writing by Owner.

 

Section 2.5                                      Other Services. Developer shall
also provide the following services during the period prior to commencement of
construction of the Subject Phase:

 

(a)                                  Interview,
negotiate with, and, after consultation with and approval of Owner, recommend
for engagement by Owner any other independent design and development
consultants (the “Consultants”) for the Subject
Phase, including, if and as appropriate, space planners, landscape architects,
civil, soils, mechanical, electrical and plumbing engineers, and acoustical,
curtain wall, lighting, art and graphic design consultants.

 

(b)                                 Manage
and coordinate the Consultants regarding the Subject Phase and coordinate
Architect’s preparation of conceptual design, and the detailed plans and specifications
therefor, including matters relating to site planning, engineering, building
shell, public space, building height, total area, floor size and landscape
design, traffic and circulation matters.

 

(c)                                  Initiate
the planning and coordinate with Owner and the Architect the receipt of all
necessary public and private approvals for the Subject Phase, including city
planning, applicable building codes, public works, any applicable architectural
review committee, and building permit approvals. Coordinate, with reliance on
the Architect, engineers and Consultants, satisfaction of all laws and
regulations affecting the Subject 

 

3

 

Phase, including,
without limitation, the Americans with Disabilities Act and all environmental
laws.

 

(d)                                 Review
designs during their development and advise Owner regarding on-site use and
improvements, selection of materials, building systems and equipment and
methods of delivery.

 

(e)                                  Provide
Owner with a monthly progress report on or before the tenth (10th)
day of each month detailing (i) the amount of work on the Subject Phase that
has been completed during the previous calendar month in relation to the schedule for
the Subject Phase (the “Schedule”);
and (ii) the General Contractor’s and all subcontractors’ compliance with
the Final Development Budget, as well as any changed conditions regarding cost.
Any changes shall be promptly reported to Owner for Owner’s approval. Attached
hereto as Exhibit E is a
conceptual schedule for the Subject Phase that has been approved by Owner.
Based upon the conceptual schedule for the Subject Phase attached hereto
as Exhibit E, Developer shall
prepare for Owner’s approval a final Schedule (such approval not to be
unreasonably withheld so long as the proposed final Schedule is consistent
with the conceptual project schedule attached hereto as Exhibit E), and once a final Schedule is
approved in writing by Owner it shall be the “Final
Schedule”. In this regard, Owner and Developer agree that (i) Developer
shall prepare and submit to Owner a proposed final Schedule pursuant to
the preceding sentence no later than thirty (30) days after execution of this
Agreement. The Schedule and General Contract shall clearly state the
number of delay days that are built into the Schedule based on factual
weather data for the Frisco, Texas area as provided by the U.S. Weather Bureau.

 

(f)                                    Advise
Owner regarding space planning, design and finish-out evaluations for the
Project.

 

(g)                                 Prepare
a detailed estimate of construction costs, developed by using estimating
techniques which anticipate the various elements of the Subject Phase, and
based on schematic design documents prepared by the Architect; and update and
refine this estimate periodically as the Architect prepares design development
and construction documents.

 

(h)                                 Provide
business administration and supervision consistent with good construction
practices and as may be required for the Subject Phase; and cause budget
draw projections for all key trades and schedules for the purchase and delivery
of all materials for the Subject Phase to be prepared and furnished to Owner.

 

Section 2.6                                      Commencement of Construction.

 

(a)                                  At
such time as Owner elects to commence construction of the Subject Phase, Owner
will give written notice thereof to Developer, and Developer shall commence or
cause to be commenced the construction within three (3) business days
thereafter. Owner, after consultation with Developer, shall designate the
general contractor (“General Contractor”)
for the Subject Phase. Developer shall negotiate the contract with the General
Contractor for the Subject Phase, which shall be subject to the 

 

4

 

review and
approval of Owner. The Developer shall, if requested by Owner, require the
General Contractor and its major subcontractors to provide performance and
payment bonds in a form satisfactory to Owner as security for their
respective obligations naming Owner and Developer as co-obligees thereon. The
General Contract shall substantially conform with the form, or in the
absence of an actual form shall substantially conform with the
guidelines and contain such provisions as are approved by Owner. Owner shall
enter into the General Contract with the General Contractor in its name. Developer
shall not amend or alter the terms of the General Contract or issue or
authorize change orders in connection therewith without the prior written
approval of Owner.

 

(b)                                 Developer
shall use commercially reasonable efforts to cause the Subject Phase to be
developed and constructed in accordance with the Final Development Plan, Final
Development Budget and Final Schedule. Developer shall provide Owner with
information in connection with updating the Final Development Plan, Final
Development Budget and Final Schedule as construction progresses and when
requested by Owner, and the Final Development Plan, Final Development Budget
and Final Schedule shall be modified from time to time based on such
updates to the extent such modifications are approved in writing by Owner. Developer
shall use commercially reasonable efforts to cause the General Contractor to
comply with the Final Development Plan, Final Development Budget and Final
Schedule.

 

(c)                                  If
the development and construction of the Subject Phase does not progress in
accordance with the dates required by the Final Schedule, Developer shall, upon
the request of Owner, cause General Contractor to speed up the work by all
available means, including utilization of overtime, additional work crews and
alternate material suppliers.

 

(d)                                 Unless
otherwise consented to by Owner, Developer shall incur no expenditures nor
authorize any other person or entity to incur or pay any expenditures in
connection with the development and construction of the Subject Phase that are
not provided for in the Final Development Budget, either in total or in any one
accounting category. All expenditures shall be charged to the proper account as
specified in the Final Development Budget and no expenditure may be classified
or reclassified for the purpose of avoiding an excess of the budgeted amount of
an accounting category without the written consent of Owner (which consent
shall not be unreasonably withheld).

 

Section 2.7                                      Administration of Subject Phase. During
construction of the Subject Phase, with due assistance from the Architect and
Consultants, Developer shall exercise general management of the Subject Phase team
and in connection therewith shall, without limiting the generality of the
foregoing, perform the following duties in respect of the Subject Phase:

 

(a)                                  Provide
direction to the General Contractor on behalf of Owner in matters requiring
such direction per the terms of the General Contract.

 

(b)                                 Appoint
management and support staff to inspect the manner and progress of the
construction of the Subject Phase;

 

5

 

(c)                                  Make
visits to the site of the Subject Phase to inspect the work and progress of
construction with the General Contractor and with the Architect and other
Consultants, which visits shall be of such frequency and duration as shall be
necessary for Developer to carry out its duties under this Agreement, to guard
against defects and deficiencies in the work and to determine that the work is
being performed in accordance with the construction documents, but in no event
shall such visits be less than three (3) days per week during the
construction of the Subject Phase. Developer shall prepare and submit to Owner
a report no less frequently than once each week detailing its observations.

 

(d)                                 Advise
Owner immediately of any material omissions, substitutions, defects, or
deficiencies noted by Developer in the work of the General Contractor or any
contractor, subcontractor or materialman.

 

(e)                                  Consult
with Owner regarding proposed changes and modifications to the construction
documents and coordinate issuance of change orders if and when changes are
approved in writing by Owner and the affected party. Developer shall ensure
that all changes in the work or services are implemented through written change
orders signed by the Owner and the affected party. Developer shall establish a
changes system to control the writing of change orders and to record all
changes to the construction documents. For changes initiated by the Owner or
Developer with respect to the General Contractor’s work, Developer shall
prepare written change order proposal requests, incorporating detailed drawings
and specifications prepared or approved by the Architect where appropriate. Developer
shall forward the requests to the General Contractor for preparation of a
proposal. For change order requests initiated by the General Contractor,
Developer shall evaluate the requests and, if applicable, provide a copy to the
Architect for comment. Developer shall evaluate proposed change orders for
price, schedule and coordination impact and shall forward its
recommendations to Owner, along with the comments of the Architect. For change
order proposals approved by the Owner and the affected party, Developer shall
prepare written change orders and shall obtain the signatures of the Owner and
the affected party. If a change is performed by the General Contractor or a
Consultant under a pricing arrangement other than lump sum, Developer shall
make a record of units, work or services or actual costs incurred, as the case may be.
Developer shall obtain from the General Contractor and Consultants copies of
supporting documents for all units of work or services or costs incurred.
Developer shall keep a record copy of all signed change orders and shall
provide copies to the Architect and Owner.

 

(f)                                    Review
and evaluate all invoices and payment applications against actual progress to
determine whether the amount claimed as the percent complete is accurate.
Developer shall certify the amounts due the General Contractor and Consultants
in a monthly draw request submitted to Owner no later than the fifth (5th) day
of each calendar month after which the draw request applies, subject to change
by the Subject Phase Lender (as hereinafter defined). Developer may certify,
modify or withhold certification for payment, and shall require necessary
revisions to such invoices. Developer will submit invoices for the Subject
Phase to the Owner for review and approval along with a report summarizing the
status of payments to the General 

 

6

 

Contractor and the
construction costs of the Subject Phase. The Developer’s certification for
payment shall constitute a representation to Owner, based on the Developer’s
determinations at the site and on the data comprising the General Contractor’s
invoices, that, to the best of the Developer’s knowledge, information and
belief, the work has progressed to the point indicated and, except as stated in
the certification for payment, the quality of the work is in accordance with
the construction documents.

 

(g)                                 Obtain
from the General Contractor all required lien waivers and all other
documentation as provided for in the General Contract, and, if required by the
terms of the General Contract, obtain payment and performance bonds from the
General Contractor covering the performance of all the work described in this
Agreement.

 

(h)                                 Consult
with the Architect and Owner if the General Contractor or any contractor or
subcontractor requests interpretations of the meaning and intent of the plans
and specifications and assist in the resolution of any questions which may arise.

 

(i)                                     Assist
in preparing such reports as may be reasonably required for the use of any
public agency on the progress of construction.

 

(j)                                     Maintain
construction cost reporting for the Subject Phase, using Owner’s standard chart
of accounts and report format.

 

(k)                                  Arrange
for the delivery and storage, protection and security of Owner- purchased materials,
systems and equipment which are a part of the Subject Phase, until such
items are incorporated into the Subject Phase.

 

(l)                                     On
application for final payment by the General Contractor, cause a final
inspection of the work by the Architect to be performed, and assemble and
deliver to Owner any written guaranties, releases, bonds and waivers,
instruction books, diagrams and charts required by the appropriate contract
documents, and issue an approval for final payment.

 

(m)                               Arrange
for and assist the General Contractor in coordinating the installation of the
public and private utilities with the appropriate utility companies on the most
favorable terms and conditions obtainable at the time.

 

(n)                                 Coordinate
the construction work with any activities of Owner on or about the site of the
Subject Phase during the construction period, including coordinating the
preparation and completion of punch list items.

 

(o)                                 Hold
regular meetings to be attended by representatives of Architect, General
Contractor and other key parties, and such special meetings as requested or
required, and record and distribute minutes and decisions; also provide copies
of meeting minutes to Owner.

 

(p)                                 Establish
a monthly reporting system that covers major operations, cost, schedule, and marketing
aspects of the Subject Phase, including:

 

7

 

(i)                                     Cost
Status - a monthly cost status report for each major cost item in the Subject
Phase, employing a format acceptable to Owner and tracking budget, estimate,
amount contracted, change orders and estimated cost to complete.

 

(ii)                                  Payments
Status - a monthly payments status report for each major cost item in the Subject
Phase employing a format acceptable to Owner and track payments made and
amounts yet to be paid and project monthly cash requirements and update
projections periodically.

 

(iii)                               Marketing
Status - a monthly report that reflects the status of leasing or sales
activity with respect to the Subject Phase and compares actual leasing or sales
activity with projected leasing or sales activity.

 

(iv)                              Work
Status - a monthly narrative with executive summary that outlines work progress
during reporting periods, and projection for work to be commenced in the next
period.

 

(q)                                 Review
(and cause the appropriate Consultants to review) all applicable building
codes, environmental, zoning and land use laws and other applicable local,
state and federal laws, regulations and ordinances concerning the development,
use and operation of the Subject Phase or any portion thereof; assist Owner in
making application for and obtaining and keeping in full force and effect all
necessary governmental approvals and permits; endeavor to perform such
acts as shall be reasonably necessary to effect compliance by the Owner with
all laws, rules, ordinances, statutes, and regulations of any governmental
authority applicable to the Subject Phase. Upon receipt of Owner’s written
request, Developer shall seek to obtain any variances or rezoning of such
portion of the Land as are necessary or appropriate to cause the Subject Phase
to be in compliance with applicable codes, laws, regulations and ordinances.
Such services shall be performed at Developer’s own cost and expense, except
that all out-of-pocket costs and costs of Owner-approved attorneys and
consultants incurred in any such efforts shall be borne by Owner. Developer
shall coordinate and establish agreements with all necessary government
agencies and utilities.

 

(r)                                    Establish
and maintain a central file for all design, construction, and related
contractual documents, including contracts, purchase orders and change orders.

 

(s)                                  Receive
and confer with Owner regarding response to all notices, claims and pertinent
correspondence, and provide Owner with three (3) close-out binders
containing all warranties, guarantees, operating manuals and as-built drawings
at Completion of the Subject Phase.

 

(t)                                    Make
payment each month of expenditures authorized in the Final Development Budget,
to the extent funds are made available therefor by Owner.

 

(u)                                 Perform such
other additional development management functions as are commercially
appropriate to complete the orderly and proper construction of the Subject 

 

8

 

Phase in
accordance with the Final Development Plan, Final Development Budget and Final
Schedule.

 

(v)                                 Maintain
current and accurate records and reports with regard to the financing,
development and progress of the Subject Phase. Such records shall be maintained
at the Developer’s principal place of business and shall be made available to
the Owner at any reasonable time, during normal business hours, for review and
inspection by the Owner. Owner shall have the right at its sole cost and
expense to make copies of any books and records applicable to the development
of the Subject Phase for Owner’s use and review. If Owner shall notify
Developer of either weaknesses in internal control or errors in record keeping,
Developer shall correct such weaknesses or errors as soon as reasonably possible
after they are disclosed to Developer. Developer shall notify Owner in writing
of the actions taken to correct such weaknesses or errors.

 

(w)                               Cause
the General Contractor to comply with all Governmental Requirements (as
hereinafter defined) relating to the Improvements and the Subject Phase, including,
but not limited to, all applicable environmental laws including the Resource
Conservation and Recovery Act and the Comprehensive Environmental Response
Compensation and Liability Act. As used herein, “Governmental
Requirements” means final land development approval and all
other permits and approvals required to commence and complete construction of
the Subject Phase in accordance with the Plans and Specifications and all
applicable statutes, ordinances, regulations, orders, rules, directives or
contracts of any federal, state, municipal or other governmental or
quasi-governmental board, agency, authority or body, including the preparation
and submission of all necessary drawings, documents, information and comments
(all of which shall be subject to Owner’s approval prior to submission to any
governmental authority).

 

(x)                                   Review
the General Contractors’ notice of substantial completion, the Punchlist
initially prepare by the General Contractor and the Punchlist as revised by the
Architect. Together with Owner and Architect, Developer shall inspect the work.
Developer’s inspection shall be to determine whether substantial completion has
been achieved and to verify the accuracy of the Punchlist. Developer shall
refuse to accept the work as substantially complete if Developer, Owner and
Architect determine that the work has not been substantially completed. If
Owner, Developer and Architect agree that the work is substantially complete,
Developer will coordinate the preparation by Architect of a certificate of
substantial completion which shall establish the date of substantial completion
of the work and shall fix the time within which the General Contractor shall
complete the items on the Punchlist. Developer shall use reasonable efforts to
obtain the General Contractor’s written acceptance of the responsibilities
assigned to General Contractor in such certificate.

 

(y)                                 If
there is a construction loan on the Subject Phase, assist Owner in preparing
and submitting to the construction lender draw requests in accordance with the
documents evidencing and securing the construction loan and otherwise use
reasonable efforts to ensure that construction of the Subject Phase is
performed in compliance with the construction.

 

9

 

Section 2.8                                      Limitation on Expenditures. Except
for expenditures made and obligations incurred in accordance with the approved Final
Development Budget for the Subject Phase, or otherwise approved in writing in
advance by Owner, Developer shall not have the power or authority to make any
expenditure or incur any expense or obligation on behalf of Owner in connection
with development of the Subject Phase, except in the face of an emergency
affecting the safety of persons or property in connection with the Subject
Phase, and then only to the extent reasonably necessary during the period of
such emergency. In the event of an emergency, Developer shall notify Owner as
soon as practicable of the existence of such emergency, the action taken by and
the expense or obligation incurred by Developer with respect thereto.

 

Section 2.9                                      Employees. Developer shall have in
its employ at all times and at its sole expense, a sufficient number of capable
employees with sufficient experience and knowledge to enable Developer to perform its
duties hereunder. All personnel used by Developer in the performance of its
duties hereunder shall be qualified by training and experience to perform their
assigned tasks and shall maintain any and all necessary or appropriate licenses
or permits in order to fulfill their responsibilities in connection with the
performance of such work. The individual development managers designated by
Developer to devote time and effort to the Subject Phase and who shall be
principally responsible for performing the development management functions set
forth in this Agreement shall be subject to the reasonable approval of Owner.
Owner hereby acknowledges its approval of the following individuals as
development managers principally responsible for performing the development
management functions set forth herein: Jim Leslie. Any substitute development
manager shall also be subject to the reasonable approval of Owner. All persons employed
by Developer in the performance of its responsibilities hereunder shall be
exclusively controlled by and shall be employees of Developer and not of Owner,
and Owner shall have no liability, responsibility or authority with respect
thereto.

 

Section 2.10                                Funds for Construction. Owner
agrees that it will fund the amount of the construction, not to exceed the
amount shown in the Final Development Budget as the same is modified by written
change orders approved by Owner.

 

Section 2.11                                Ownership of Information and Materials.
Owner shall have the right to use, without further compensation to Developer,
all written data and information generated by or for Developer in connection
with the Subject Phase or supplied to Developer by Owner or Owner’s contractors
or agents, and all drawings, plans, books, records, contracts, agreements and
all other documents and writings in its possession relating to its services or
the Subject Phase. Such data and information shall at all times be the property
of Owner, and upon request of Owner, Developer shall deliver to Owner any such data
and information in the possession of under the control of Developer. Developer
agrees, for itself and all persons retained or employed by Developer in
performing its services, to hold in confidence and not to use or disclose to
others any confidential or proprietary information of Owner which is heretofore
or hereafter disclosed to Developer or any such persons and which is designated
by Owner as confidential and proprietary, including but not limited to any
proprietary or confidential data, information, plans, programs, plants,
processes, equipment, costs, operations, tenants or customers which may come
within the knowledge of Developer or any such persons in the performance of, or
as a result of, its services, except where (a) Owner specifically
authorizes Developer to disclose any of the 

 

10

 

foregoing
to others or such disclosure reasonably results from the performance of
Developer’s duties hereunder, or (b) such written data or information
shall have theretofore been made publicly available by parties other than
Developer or any such persons, or (c) Developer is required by law to
disclose such information (provided that in such case Developer shall give
Owner prior notice of the request for disclosure and shall cooperate with Owner
in obtaining a protective order or other remedy at Owner’s expense).

 

Section 2.12                                Hazardous Substances. Developer
shall exercise such efforts as are exercised by other prudent developers of
similar property to prevent any Hazardous Substances from being deposited,
stored, disposed, placed, generated, manufactured, buried, refined,
transported, treated, discharged, handled or located on the Land or
Improvements, except as may be specifically authorized by Owner of this
Agreement. In connection with any such Hazardous Substances so authorized,
Developer shall exercise commercially reasonable efforts to confirm that any
such authorized activity with respect to Hazardous Substances is conducted in
accordance with applicable Governmental Requirements and the terms and
conditions of any such authorization by Owner. The term “Hazardous
Substances” includes (a) any chemical, material, element,
compound, solution, mixture, substance or other matter of any kind whatsoever
which is defined, classified, listed, designated or regulated as hazardous,
toxic or radioactive by any federal statute, ordinance, regulation, order, rule or
directive, or any statute, ordinance, regulation, order, rule or directive
of the State of Texas, any political subdivisions of that state, any township
or municipal corporation of the state, or any board, agency, authority or body
associated with any of the foregoing or any quasi-governmental body or agency
with jurisdiction over such matters; (b) PCBs or asbestos or materials
containing PCBs or asbestos; (c) petroleum and petroleum-based chemicals
and substances; and (d) urea formaldehyde.

 

Section 2.13                                Payment for Materials. Notwithstanding
anything contained herein to the contrary, no amount shall be paid to Developer
for materials delivered but not yet incorporated into the Subject Phase unless
Owner and Subject Phase Lender receive (a) bills of sale or other evidence
to the passage of title of such materials to Owner, subject only to payment, (b) evidence
that the materials are insured under applicable casualty insurance policies,
and (c) evidence that such materials are securely stored at the Subject Phase.
In the event of any conflict between this Section 2.13 and the terms and
conditions of Owner’s agreements with the Subject Phase Lender, the latter
shall control.

 

Section 2.14                                Completion.

 

(a)                                  Developer
shall use commercially reasonable efforts to cause Completion (as hereinafter
defined) of the Subject Phase to occur on or before the final completion date
set forth in the Project Schedule.

 

(b)                                 For
purposes of this Agreement, the “Completion”
of the Subject Phase shall be deemed to have occurred on such date as all the
following conditions are fulfilled:

 

(i)                                     The
Subject Phase has been completed in substantial accordance with the plans and
specifications for the Subject Phase (as same have been approved by Owner) and
all punchlist items have been completed.

 

11

 

(ii)                                  Owner
has been delivered a true and correct copy of an affidavit of the General
Contractor in respect of the Subject Phase setting forth the following:

 

(A)                              That
the General Contractor has been paid in full for all work relating to the Subject
Phase performed through the date of the affidavit;

 

(B)                                That
the General Contractor has paid all subcontractors, suppliers and other vendors
in full for all amounts due through the date of the affidavit;

 

(C)                                That
the work on the Subject Phase through the date of the affidavit has been
performed in substantial accordance with the plans and specifications for the
Subject Phase approved by Owner;

 

(iii)                               Owner
and any escrowee under any construction escrow created in relation to the Subject
Phase have received the General Contractor’s final lien waiver on a form to
be reasonably approved by Owner, which among other things waives and releases
all lien rights and any claims the General Contractor may have with
respect to the Owner or the Subject Phase and related improvements.

 

(iv)                              Subject
to the provisions of Section 2.14(c) below, Developer has delivered
to Owner, at the expense of Owner, a search of title in respect of the Subject
Phase evidencing that no mechanics’ or materialmen’s liens affect the Subject Phase;

 

(v)                                 Developer
has delivered to Owner a sworn certification by Developer that it is not aware
of any matter contained in the General Contractor’s sworn statement required
above that is incorrect,

 

(vi)                              Developer
has delivered to Owner a Certificate of Substantial Completion from the
Architect on the form promulgated by the AIA in respect of the Subject
Phase;

 

(vii)                           Developer
has delivered to Owner a final certificate of occupancy for the Subject Phase;

 

(viii)                        Developer
has delivered to Owner three (3) binders with all warranties, guaranties,
operating manuals and similar closeout documents concerning the improvements
required by the plans and specifications for the Subject Phase;

 

(ix)                                Developer
has otherwise complied with the provisions of this Agreement relative to the Subject
Phase and is not in default hereunder.

 

(c)                                  Notwithstanding
the provisions of Section 2.14(b)(iv) above, the fact that a
mechanics’ or materialmen’s lien has been filed against the Subject Phase shall
not prevent Completion from having occurred provided that one of the following
conditions 

 

12

 

is fulfilled: (i) Owner
has in its possession retainage pursuant to the General Contract that is
sufficient to pay such mechanics’ or materialmen’s lien; or (ii) Developer purchases (or causes to be
purchased) a bond in the amount of one hundred fifty percent (150%) of the
amount of such mechanics’ or materialmen’s lien.

 

ARTICLE 3

COMPENSATION

 

Section 3.1                                      Development Fee. For all services
rendered in connection with the development of the Subject Phase pursuant to Article 2,
Developer shall be paid a fee (the “Development Fee”)
equal to three percent (3%) of all approved Designated Construction Costs (as
defined in Exhibit F attached
hereto); provided, however, that the Development Fee shall be subject to
possible reduction as set forth in Section 3.2 below. The Development Fee
shall be paid according to the schedule set forth on Exhibit G
attached hereto, subject to the provisions of Section 3.2 below. The
Development Fee shall be Developer’s full and complete compensation for the
performance of duties, services, efforts and/or activities in connection with
the development of the Subject Phase, whether or not enumerated in Article 2.
Developer shall not be entitled to payment for or reimbursement of any costs or
expenses incurred in the performance of the services under Article 2 or
otherwise in connection with the development of the Subject Phase, except as
expressly set forth in this Agreement or the Final Development Budget.

 

Section 3.2                                      Adjustment to Development Fee. Owner
and Developer have agreed that seventy percent (70%) of the Development Fee
shall be funded in accordance with the provisions of Exhibit G
and that thirty percent (30%) of the Development Fee (the “Retained
Development Fee”) shall be retained by Owner pending Completion
and shall be subject to loss by Developer in accordance with the provisions of
this Section 3.2. Upon the date of Completion, a determination shall be
made as to whether the Development Fee should be reduced as follows:

 

(a)                                  If
the Designated Construction Costs incurred to complete the Subject Phase exceed
the Designated Construction Costs set forth in the Final Development Budget,
then the Development Fee shall be reduced by the lesser of (i) the amount
by which incurred Designated Construction Costs exceed the Designated
Construction Costs set forth in the Final Development Budget, or (ii) one
hundred percent (100%) of the Retained Development Fee.

 

(b)                                 If
the actual date of Completion extends more than thirty (30) days beyond the
date of Completion as projected in the Final Schedule (excluding delays
caused by Force Majeure Events, delays requested by the General Contractor and
approved by Owner, and delays resulting from change orders otherwise approved
in writing by Owner), then the Development Fee shall be reduced by an amount
equal to one hundred percent (100%) of the Retained Development Fee.

 

(c)                                  Notwithstanding
the foregoing provisions of this Section 3.2, in no event shall the aggregate
decrease in the Development Fee pursuant to Sections 3.2(a) and

 

13

 

3.2(b) above
exceed an amount equal to one hundred percent (100%) of the Retained
Development Fee.

 

Section 3.3                                      Effect of Change Orders. In
determining whether the Designated Construction Costs incurred to complete the
Subject Phase exceed the Designated Construction Costs set forth in the Final
Development Budget pursuant to Section 3.2(a) above, the Final
Development Budget shall be deemed amended (if not formally amended) by any
change orders approved in writing by Owner that increase the Designated Construction
Costs incurred to complete the Subject Phase. Likewise, in determining whether
the actual date of Completion extends more than thirty (30) days beyond the
date of Completion as projected in the Final Schedule pursuant to Section 3.2(b) above,
the Final Schedule shall be deemed amended (if not formally amended) by
any change orders approved in writing by Owner that delay the actual date of
Completion.

 

Section 3.4                                      Limited Liability for Cost Overruns and Delays.
Notwithstanding anything contained herein to the contrary (including
specifically, without limitation, the provisions of Section 4.2 and Section 5.4
hereof), Developer shall have no liability for the failure of the Subject Phase
to be constructed in accordance with the Final Development Budget or the Final Schedule except
for loss of the Retained Development Fee as set forth in Section 3.2 above.
However, the preceding sentence should not be construed to limit the liability
of Developer for any other default or breach by Developer under this Agreement.

 

Section 3.5                                      No Other Compensation. Other than
the Development Fee, Developer shall be entitled to no compensation under this
Agreement, nor will Developer be entitled to any reimbursement of expenses
except as expressly set forth in this Agreement or the Final Development Budget.
Without limiting the generality of the preceding sentence, it is specifically
agreed that, except as expressly set forth in the Final Development Budget,
Developer will not be entitled to reimbursement for (a) Developer’s
overhead and general expenses; (b) the salary and wages, payroll taxes,
insurance, workers’ compensation and other benefits of any employees of
Developer; (c) the cost of forms, papers, ledgers and other supplies and
equipment used in the Developer’s office; (d) the cost of electronic data
processing or computer services that Developer may elect to incur in the
performance its duties under this Agreement; (e) the cost of office
equipment acquired by Developer to enable it to perform its duties
hereunder; (f) the cost of advances made to employees of Developer and
cost of travel and lodging by Developer’s employees and agents; (g) costs
arising from the negligence of Developer, and (h) costs Developer is
prohibited from incurring with respect to the Subject Phase pursuant to Section 2.6(d).

 

ARTICLE 4

INSURANCE AND
INDEMNITY

 

Section 4.1                                      Insurance Requirements. Throughout
the term of this Agreement, insurance with respect to the Subject Phase shall
be carried and maintained in force in accordance with the provisions contained
in Exhibit H attached hereto and
made a part hereof, with the premiums and other costs and expenses for
such required insurance to be borne as provided in Exhibit H.

 

14

 

Section 4.2                                      Indemnity. Subject to Section 4.3,
Developer shall indemnify, defend and hold Owner and its owners, officers,
employees and agents harmless from and against any and all costs, expenses,
attorneys’ fees, suits, liabilities, damages, or claims for damages, in any way
relating to the management of the Subject Phase by Developer and arising out of
or in connection with the negligence or willful misconduct of Developer or
Developer’s failure or refusal to comply with or abide by or perform its
obligations set forth in this Agreement. Subject to Section 4.3, Owner
shall indemnify, defend and hold Developer and its owners, officers, employees
and agents harmless from and against all costs, expenses, attorneys’ fees,
suits, liabilities, damages, or claims for damages arising out of or in
connection with the negligence or willful misconduct of Owner or Owner’s
failure or refusal to comply with or abide by or perform its obligations
set forth in this Agreement. The indemnities set forth in this Section 4.2
shall survive the termination of this Agreement, but shall lapse and be of no
further effect unless a claim is made thereunder in a court of competent
jurisdiction within the applicable period of limitations provided under Texas law.

 

Section 4.3                                      Waiver of Subrogation. OWNER, ON BEHALF OF ITSELF AND ITS
INSURERS, WAIVES ITS RIGHTS OF RECOVERY AGAINST DEVELOPER OR DEVELOPER’S
PARTNERS AND THEIR RESPECTIVE OFFICERS, DIRECTORS AND EMPLOYEES, FOR DAMAGES
SUSTAINED BY OWNER AS A RESULT OF ANY DAMAGE TO ANY PROPERTY OR ANY INJURY TO
PERSONS ARISING FROM ANY RISK OR PERIL GENERALLY COVERED OR COVERABLE BY ANY
INSURANCE POLICY ACTUALLY CARRIED BY OR REQUIRED TO BE CARRIED BY OWNER
PURSUANT TO THE TERMS OF THIS AGREEMENT, REGARDLESS OF CAUSE, INCLUDING
NEGLIGENCE; AND OWNER AGREES THAT NO PARTY SHALL HAVE ANY SUCH RIGHT OF
RECOVERY BY WAY OF SUBROGATION OR ASSIGNMENT. DEVELOPER, ON BEHALF OF ITSELF
AND ITS INSURERS, WAIVES ITS RIGHTS OF RECOVERY AGAINST OWNER AND OWNER’S
PARTNERS AND THEIR RESPECTIVE OFFICERS, DIRECTORS AND EMPLOYEES, FOR DAMAGES
SUSTAINED BY DEVELOPER AS A RESULT OF ANY DAMAGE TO ANY PROPERTY OR ANY INJURY
TO PERSONS ARISING FROM ANY RISK OR PERIL GENERALLY COVERED OR COVERABLE BY ANY
INSURANCE POLICY ACTUALLY CARRIED BY OR REQUIRED TO BE CARRIED BY DEVELOPER PURSUANT
TO THE TERMS OF THIS AGREEMENT, REGARDLESS OF CAUSE, INCLUDING NEGLIGENCE; AND
DEVELOPER AGREES THAT NO PARTY SHALL HAVE ANY SUCH RIGHT OF RECOVERY BY WAY OF
SUBROGATION OR ASSIGNMENT. OWNER AND DEVELOPER SHALL EACH NOTIFY THEIR
RESPECTIVE INSURANCE CARRIERS OF THE MUTUAL WAIVERS HEREIN CONTAINED AND SHALL
CAUSE THEIR RESPECTIVE INSURANCE POLICIES REQUIRED HEREUNDER TO BE ENDORSED, IF
NECESSARY, TO PREVENT ANY INVALIDATION OF COVERAGE AS A RESULT OF THE MUTUAL
WAIVERS HEREIN CONTAINED AND SHALL CAUSE THEIR RESPECTIVE INSURANCE POLICIES
REQUIRED HEREUNDER TO BE ENDORSED, IF NECESSARY, TO PREVENT ANY INVALIDATION OF
COVERAGE AS A RESULT OF THE MUTUAL WAIVERS HEREIN CONTAINED.

 

Section 4.4                                      Non-Recourse Liability. The
liability of Owner for the payment of all sums which may be owed to
Developer under this Agreement and for the performance of all other obligations
of Owner to Developer under this Agreement shall be limited to Owner’s 

 

15

 

interest
in the Subject Phase and the proceeds thereof. Neither Owner nor any of the
constituent partners or members of Owner or any partners or members,
shareholders, officers, directors, beneficiaries or trustees of the constituent
partners or members of Owner shall be personally liable for the payment of any
sums or the performance of any other obligations to Developer.

 

ARTICLE 5

TERM AND TERMINATION

 

Section 5.1                                      Term. Developer shall manage the
development of the Subject Phase as herein specified until Completion (as
hereinafter defined) of the Subject Phase; provided, however, if any remedial
work to be performed by the General Contractor (as hereinafter defined)
following the Completion of the Subject Phase has not been completed, the term
of this Agreement shall be extended until the date on which any remedial work
required to be performed by the General Contractor following completion of the Subject
Phase shall be so performed and accepted by Owner.

 

Section 5.2                                      Termination by Owner. Notwithstanding
anything contained in this Agreement to the contrary, Owner may terminate
this Agreement if one or more of the following events shall occur:

 

(a)                                  the
filing by Developer of a voluntary petition in bankruptcy, the filing by a
creditor of an involuntary petition in bankruptcy which is not dismissed within
sixty (60) days, the adjudication of Developer as bankrupt or insolvent, the
filing by Developer of any petition or answer seeking any reorganization,
arrangement, composition, readjustment, liquidation, dissolution, assignment for
the benefit of creditors, or similar relief for debtors;

 

(b)                                 a
failure by Developer to pay any amounts or monetary obligations due and owing
to Owner which is not cured within five (5) days following receipt of
written notice by Owner specifying such default;

 

(c)                                  failure
by Developer to achieve Completion of the Subject Phase within ninety (90) days
after the scheduled date of Completion set forth in the Final Schedule;

 

(d)                                 a
good faith determination by Owner that either (i) Developer is not
developing the Subject Phase in a manner satisfactory to Owner, or (ii) completion
of the Subject Phase is not economically feasible;

 

(e)                                  The
costs of the Subject Phase (except those costs incurred with the written
approval of Owner) exceed, or in Owner’s reasonable judgment will exceed, the
amount set forth in the Final Development Budget;

 

(f)                                    a
material default by Developer under this Agreement that is not cured within
thirty (30) days following receipt of written notice from Owner specifying the
default; provided, however, that if such default cannot be cured within such
thirty (30) day period through the use of diligent efforts, such period shall
be extended for an additional thirty (30) days; provided, further, that if
Developer promptly commences such 

 

16

 

cure and
thereafter diligently prosecutes such cure but is unable to complete such cure
within the aforesaid two thirty (30) day periods, Developer shall be afforded
an additional thirty (30) days to complete such cure;

 

(g)                                 Owner
sells the Subject Phase, at Owner’s election;

 

(h)                                 the
termination of the Master Development Agreement for any reason;

 

(i)                                     Developer
(or an affiliate of Developer) defaults in its obligation under that certain limited
partnership agreement of Behringer Harvard Frisco Square LP executed on even
date herewith and such default is not cured within any applicable notice or
grace period.

 

(j)                                     Frisco
Square Land, Ltd., Frisco Square Properties, Ltd., Frisco Square B1-6, F1-11,
Ltd. or Frisco Square B1-7, F1-10, Ltd. ceases to own any interest in Owner.

 

Section 5.3                                      Termination by Developer. Developer
may terminate this Agreement if one or more of the following events shall
occur:

 

(a)                                  a
failure by Owner to pay any amounts or monetary obligations due and owing to
Developer which is not cured within three (3) business days following
receipt of written notice by Developer specifying such default;

 

(b)                                 a
material default by Owner under this Agreement that is not cured within thirty
(30) days following receipt of written notice from Developer specifying the
default; provided, however, that if such default cannot be cured within such
thirty (30) day period through the use of diligent efforts, such period shall
be extended for an additional thirty (30) days; provided, further, that if
Owner promptly commences such cure and thereafter diligently prosecutes such
cure but is unable to complete such cure within the aforesaid two thirty (30)
day periods, Owner shall be afforded an additional thirty (30) days to complete
such cure.

 

Section 5.4                                      Additional Remedies. If either
party defaults in the performance of any of its obligations hereunder and such
default continues beyond the applicable notice and cure periods as set forth in
Section 5.1, then the non-defaulting party may pursue all other
rights, remedies and recourses available at law. Enforcement of the provisions
of this Article 5 shall not diminish Developer’s obligations under Article 6.

 

ARTICLE 6

DUTIES UPON TERMINATION OR EXPIRATION

 

Section 6.1                                      Developer’s Duties. Upon
termination or expiration of this Agreement, Developer shall, within ten (10) days
thereafter, deliver to Owner complete copies of all books and records
maintained by Developer for the Project.

 

17

 

Section 6.2                                      Owner’s Duties. Owner shall
compensate Developer for all fees earned hereunder through the date of
termination promptly following the delivery of the information called for in Section 6.1,
subject to any claims Owner may have arising out of Developer’s default in
performance hereunder.

 

ARTICLE 7

REPRESENTATIONS AND
WARRANTIES

 

Section 7.1                                      Developer’s Representations and Warranties.
Developer hereby represents and warrants to Owner as of the date hereof as
follows:

 

(a)                                  Developer
is duly organized, validly existing and in good standing under the laws of the
State of Texas, and is authorized to conduct business in the State of Texas. Developer
has full power and authority to execute, deliver and carry out the terms and
provisions of this Agreement and has taken all necessary action, corporate or
otherwise, to authorize the execution, delivery and performance of this
Agreement, and this Agreement constitutes the legal, valid and binding
obligation of Developer enforceable in accordance with its terms, subject to
creditor’s rights, bankruptcy and any other equitable principles. The execution
and delivery of this Agreement by the party signing on behalf of Developer has
been duly authorized. No order, permission, consent, approval, license,
authorization, registration or validation of, or filing with, or exemption by,
any governmental agency, commission, board or public authority is required to
authorize, or is required in connection with, the execution, delivery and
performance of this Agreement.

 

(b)                                 The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereunder on the part of Developer do not and
will not conflict with or result in the breach of any material terms or
provisions of, or constitute a default under, or result in the creation or
imposition of any lien, charge, or encumbrance upon any of the assets of
Developer by reason of the terms of any contract, mortgage, lien, lease,
agreement, indenture, instrument or judgment to which Developer is a party or
which is or purports to be binding upon Developer or which otherwise affects
Developer, or which otherwise will not be discharged, assumed or released. No
action by any federal, state or municipal or other governmental department,
commission, board, bureau or instrumentality is necessary to make this
Agreement a valid instrument binding upon Developer in accordance with its
terms.

 

(c)                                  There
are no attachments, executions, assignments for the benefit of creditors,
receiverships, conservatorships or voluntary or involuntary proceedings in
bankruptcy or pursuant to any other debtor relief laws contemplated or filed by
Developer or pending against Developer.

 

(d)                                 all
authorizations, approvals and consents, if any, required to be obtained from,
and all registrations, declarations and filings, if any, required to be made
with, all governmental authorities and all other persons or entities to permit
Developer to execute and deliver and to perform its obligations under this
Agreement have been obtained or 

 

18

 

made and all such
authorizations, approvals, consents, registrations, declarations and filings
are in full force and effect, and all terms and conditions contained in or
existing in respect of such authorizations, approvals, consents, registrations,
declarations and filings have, to the extent necessary prior to the date of
execution and delivery hereof and thereof, been duly satisfied and performed;

 

(e)                                  there
are no claims, actions, litigation, judgments, rulings, suits or proceedings
actual, pending, or, to the best of Developer’s knowledge, threatened,
including, without limitation, bankruptcy or other insolvency proceedings, by
or against Developer which, if determined adversely to Developer, would
materially adversely affect Developer’s ability to perform its obligations
under this Agreement;

 

(f)                                    Developer
is possessed of sufficient skill, qualifications, experience, expertise and
capability to perform its obligations hereunder, shall maintain adequate
personnel, manpower, capital, equipment and facilities to perform its
obligations hereunder, and holds any and all licenses, certificates,
authorizations and registrations required to permit it to perform its
obligations hereunder;

 

(g)                                 Developer
represents that it is knowledgeable and experienced in the development and
construction management of property similar to the Project in the Frisco, Texas
metropolitan area.

 

Section 7.2                                      Owner’s Representations and Warranties.
Owner hereby represents and warrants to Developer as of the date hereof:

 

(a)                                  Owner
is duly organized, validly existing and in good standing under the laws of the
State of Texas, and is authorized to conduct business in the State of Texas. Owner
has full power and authority to execute, deliver and carry out the terms and
provisions of this Agreement and has taken all necessary action, corporate or
otherwise, to authorize the execution, delivery and performance of this
Agreement, and this Agreement constitutes the legal, valid and binding
obligation of Owner enforceable in accordance with its terms, subject to
creditor’s rights, bankruptcy and any other equitable principles. The execution
and delivery of this Agreement by the party signing on behalf of Owner has been
duly authorized. No order, permission, consent, approval, license,
authorization, registration or validation of, or filing with, or exemption by,
any governmental agency, commission, board or public authority is required to
authorize, or is required in connection with, the execution, delivery and
performance of this Agreement.

 

(b)                                 The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereunder on the part of Owner do not and will
not conflict with or result in the breach of any material terms or provisions
of, or constitute a default under, or result in the creation or imposition of
any lien, charge, or encumbrance upon any of the assets of Owner by reason of
the terms of any contract, mortgage, lien, lease, agreement, indenture,
instrument or judgment to which Owner is a party or which is or purports to be
binding upon Owner or which otherwise affects Owner, or which otherwise will
not be discharged, assumed or released. No action by any federal, state or 

 

19

 

municipal or other
governmental department, commission, board, bureau or instrumentality is
necessary to make this Agreement a valid instrument binding upon Owner in
accordance with its terms.

 

(c)                                  There
are no attachments, executions, assignments for the benefit of creditors,
receiverships, conservatorships or voluntary or involuntary proceedings in
bankruptcy or pursuant to any other debtor relief laws contemplated or filed by
Owner or pending against Owner.

 

ARTICLE 8

MISCELLANEOUS
PROVISIONS

 

Section 8.1                                      Notices. All notices, requests, and
communications required or permitted hereunder shall be in writing and shall be
sufficiently given and deemed to have been received (a) upon personal
delivery, (b) twenty four (24) hours after deposit with a recognized
overnight delivery service, (c) upon receipt of electronic confirmation of
receipt in the event of delivery by telefacsimile (provided that such
telefacsimile is followed by delivery by United State mail), or (d) if
mailed, upon the first to occur of actual receipt or forty eight (48) hours
after being placed in the United States mail, postage prepaid, registered or
certified mail, with return receipt requested. The addresses to which notices
should be sent are set forth on the signature pages of this Agreement. Notice
of a change in address of one of the parties shall be given in writing to the
other party as provided above, and shall be effective only upon actual receipt.

 

Section 8.2                                      Assignment. Developer may not
assign its rights nor delegate its duties hereunder without the prior written
consent of Owner. Developer’s assignment in contravention of this Section shall
be null and void. Any permitted assignment by Developer shall not relieve
Developer of any of its obligations hereunder. Owner shall have the right to
assign its rights and duties under this Agreement without the consent of
Developer.

 

Section 8.3                                      Waiver of Lien Claims. Developer
hereby waives any and all rights it may now or hereafter have to assert a
lien (whether constitutional, statutory, conferred by common law or arising in
any other manner) against the Project or any part thereof.

 

Section 8.4                                      Lender Requirements. In the event
that a mortgagee of the Subject Phase (a “Subject
Phase Lender”) requests that Developer execute a document
in connection with a loan to Owner, Developer will respond to such request
promptly and will not unreasonably withhold its consent to the execution of
such document (it being agreed that Developer shall not be required to execute
any document that reduces the Development Fee payable to Developer under this
Agreement). Without limiting the generality of the preceding sentence,
Developer agrees that it will execute and deliver the following documents
within five (5) days after request therefor: (a) an agreement that a Subject
Phase Lender may terminate this Agreement if a default occurs in respect
of the loan secured by the Subject Phase; (b) an estoppel certificate
certifying that this Agreement is in full force and effect and containing such
other certifications as may be reasonably requested; (c) an agreement
subordinating this Agreement and the fees payable to Developer hereunder  to any mortgage or deed or trust held by a Subject
Phase Lender; and (d) confirmation of the waiver by Developer of any right
to assert a lien 

 

20

 

against
the Subject Phase or any other part of the Project. Developer shall use
reasonable care to avoid any act or omission that, in the performance of its
duties hereunder, shall in any way conflict with the terms of any mortgage
documents in respect of the Subject Phase or any other part of the Project,
provided that Developer has been furnished with copies of such mortgage
documents. In addition, Developer agrees to conform its general policies
and procedures to any commercially reasonable requirements of any Subject Phase
Lender providing financing for the acquisition or construction of the Subject
Phase or any other part of the Project.

 

Section 8.5                                      Force Majeure Events. Except for
obligations regarding the payment of money and the maintenance of insurance,
whenever a period of time is herein prescribed for action to be taken by Owner
or Developer, neither party shall be liable or responsible for, and there shall
be excluded from the computation for any such period of time, any delays due to
Force Majeure Events. For purposes hereof, “Force
Majeure Events” shall consist of abnormal weather patterns that
affect critical path construction, acts (or the failure to act) by the other
party to this Agreement, unforeseeable subsurface conditions, delay in issuance
of permits outside the reasonable control of Developer, changes in governmental
laws, enemy or hostile governmental action, civil commotion, and fire or other
casualty. The party seeking to excuse delay in performance by reason of a Force
Majeure Event must, no later than the tenth (10th) day of the calendar month
immediately following the calendar month in which such Force Majeure Event
occurs, notify the other party thereof in writing, and of the cause or causes
thereof.

 

Section 8.6                                      Governing Law. This Agreement shall
be governed and construed in accordance with the laws of the State of Texas.

 

Section 8.7                                      Time of Essence. Time is of the
essence of this Agreement.

 

Section 8.8                                      Compliance Amendments. Reference is made to Behringer Harvard
Opportunity Op I LP, a Texas limited partnership (“BH REIT”),
which owns a direct or indirect interest in Owner. Notwithstanding anything
contained herein to the contrary, in the event that legal counsel for Owner
reasonably determines that an amendment to this Agreement is necessary or
advisable in order for this Agreement to comply with applicable tax laws
(including, without limitation, laws and regulations pertaining to real estate
investment trusts), applicable securities laws, the offering documents
pertaining to  BH REIT or any Affiliate, or the Statement of Policy
Regarding Real Estate Programs of the North American Securities Administrators
Association, Inc., effective September 29,
1993, as amended, then Owner and Developer shall, within ten (10) business
days after request from Owner, execute such an amendment;
provided, however, that no such amendment may decrease the compensation to
which Developer is entitled hereunder or materially increase Developer’s
liabilities or obligations under this Agreement without Developer’s written
consent.

 

Section 8.9                                      Entireties, Beneficiaries. This
Agreement and the Master Development Agreement represent the entire Agreement
between Owner and Developer with regard to development of the Subject Phase and
all prior agreements are superseded hereby. This Agreement is for the sole
benefit of Owner and Developer and no other party is benefited hereby. This
Agreement creates contractual rights only between Owner and Developer, and
Developer has no lien rights in or to the Subject Phase or any other part of
the Project.

 

21

 

Section 8.10                                No Agency. Developer and its agents
shall all act as independent contractors in respect of Owner with regard to
this Agreement. All personnel and staff of Developer shall be and remain
employees or agents of, or independent contractors with, Developer and not of
or with Owner. Developer shall at all times represent to third parties that the
relationship of Developer to Owner, with regard to Developer’s duties under
this Agreement, is that of independent contractor, and Developer and Owner
shall not represent to any party that Developer and Owner are partners, co-venturers
or principal and agent, or have any other relationship other than that of
independent contractors with regard to this Agreement. Developer’s authority to
act on behalf of Owner is strictly limited to that expressly delegated herein. Developer
represents and warrants that (a) it has all the requisite licenses and
other approvals required by law to carry out its duties hereunder; or (b) it
will affect the services requiring such licenses through duly licensed agents
and subcontractors who are affiliates of Developer that have all requisite
licenses and authority to carry out such services.

 

Section 8.11                                Attorneys’ Fees. Should either the
Owner or the Developer employ an attorney or attorneys to enforce any of the
terms and conditions of this Agreement, or to protect any right or interest
created or evidenced hereby, the losing party shall pay the party obtaining final,
unappealable judgment all reasonable costs, damages and expenses, including
reasonable attorneys’ fees and expenses incurred by the prevailing party.

 

Section 8.12                                No Waiver. The failure of either
party to seek redress for violation, or to insist upon the strict performance
of any covenant, agreement, provision or condition of this Agreement shall not
constitute a waiver of such strict performance and the parties shall have all
remedies provided in this Agreement and by applicable law with respect to any
subsequent act which would he originally constituted a violation.

 

Section 8.13                                Interpretation. Within this
Agreement, words of any gender shall be held and construed to include any other
gender, and words in the singular number shall be held and construed to include
the plural, unless the context otherwise requires. The paragraph headings used
in this Agreement are intended for reference purposes only and shall not be
considered in the interpretation of the terms and conditions of this Agreement.

 

Section 8.14                                Severability. If one or more of the
provisions of this Agreement or any application of this Agreement shall be
invalid, illegal or unenforceable in any respect, the validity, legality or
enforceability of the remaining provisions of this Agreement and any other
application of such provisions shall in no way be affected or impaired.

 

Section 8.15                                Amendments. This Agreement may be
amended, from time to time, only with the written consent of both Owner and
Developer.

 

Section 8.16                                Counterparts. This Agreement may be
executed in several counterparts, each of which shall be deemed an original,
and said counterparts shall constitute but one and the same instrument.

 

Section 8.17                                Additional Acts. In connection with
this Agreement, as well as all transactions contemplated by this Agreement,
Owner and Developer each agree to execute and deliver such additional documents
and instruments and take all such necessary action and 

 

22

 

perform such
additional acts as may be necessary or appropriate to effectuate, carry
out and perform all of the terms, provisions and conditions of this
Agreement and all such transactions; provided, however, this Agreement may be
modified only in accordance with the terms hereof.

 

Section 8.18                                Exhibits. All exhibits referred to
herein shall be considered a part of this Agreement as fully as if and
with the same force and effect as if such exhibit had been included herein
in full.

 

Section 8.19                                Limitation of Liability. Any
liability of Owner to Developer (or any person or entity claiming by, through
or under Developer) for any default by Owner under this Agreement or any matter
relating to this Agreement shall be limited to Developer’s actual direct, but
not consequential, damages therefore. Owner’s liability under this Agreement is
limited to Owner’s interest in the Subject Phase, and if Owner is comprised of
more than one entity, the liability of each entity comprising Owner shall be
several only (not joint) based upon such entity’s proportionate share of
ownership in the Subject Phase. Any liability of Developer to Owner (or any
person or entity claiming by, through or under Owner) for any default by
Developer under this Agreement or any matter relating to this Agreement shall
be limited to Owner’s actual direct, but not consequential, damages therefor.

 

Section 8.20                                Confidentiality. Developer will
keep confidential (a) the terms of this Agreement, and (b) all
written and verbal negotiations and communications with Owner in connection
with this Agreement (collectively, “Confidential Information”),
and Developer will not disclose or make available any Confidential Information
to any other person or entity, except to Developer’s accountants, brokers,
attorneys, and other agents for the purpose of providing advice to Developer in
connection with the Confidential Information and who agree to preserve the
confidential nature of the Confidential Information, or as Developer is
required to disclose by law or court order.

 

Section 8.21                                Authority of Developer. Developer
shall have no right or authority, express or implied, to commit or otherwise
obligate Owner in any manner whatsoever except to the extent specifically
provided herein or specifically authorized in writing by Owner.

 

Section 8.22                                Licenses. Developer shall, at its
own expense, qualify to do business and obtain and maintain such licenses as may be
required for the performance by Developer of its services.

 

Section 8.23                                Non-Discrimination Policy. Developer
agrees that it will not deny the benefits of this Agreement to any person, nor
discriminate against any employee or applicant for employment because of race,
color, religion, sex, national origin, age or any other applicable protected
classification. Developer will take affirmative action to insure that the
evaluation and treatment of employees ate free from such discrimination. Developer,
unless exempt, further agrees to abide by the terms of all applicable Federal,
state and local non-discrimination provisions, including but not limited to 41
CFR Sec. 60-1.4, such non-discrimination provisions being incorporated herein
by reference. Developer shall include this non-discrimination clause in all
contracts and subcontracts to perform work under this Agreement and will
notify all labor organizations with which it has a collective bargaining
agreements of the obligations hereunder.

 

23

 

Section 8.24                                Waiver of Jury Trial. Developer and
Owner each hereby waives trial by jury in any action arising out of matters
related to this Agreement, which waiver is informed and voluntary.

 

Section 8.25                                Dispute Resolution. The parties hereto have agreed to
submit disputes to mandatory arbitration in accordance with the provisions of
this Section 8.25. Each party waives the right to commence an action in
connection with this Agreement in any court and expressly agrees to be bound by
the decision of the arbitrator determined in this Section 8.25; provided,
however, the waiver in this Section 8.25 will not prevent the other party
from commencing an action in any court for the sole purposes of enforcing the
obligation of the other party to submit to binding arbitration or the
enforcement of an award granted by arbitration herein. Notwithstanding the
foregoing, prior to submitting any dispute hereunder to arbitration, each party
shall first attempt in good faith, for thirty (30) days after the first notice
given under this Agreement regarding such dispute, to resolve any such dispute
promptly by negotiation between executives of each party who have authority to
settle the dispute, which shall include an in-person meeting between such
executives in Dallas, Texas.

 

(a)                                  Any
dispute between the parties as to the interpretation of any provision of this
Agreement or the rights and obligations of any party hereunder shall be
resolved through binding arbitration as hereinafter provided in Dallas, Texas. Upon agreement between Owner and Developer,
other parties may be made a party to the arbitration proceeding.

 

(b)                                 If
arbitration is required to resolve a dispute between the parties, a panel of
three (3) arbitrators shall be convened. Each party hereto shall each
select one (1) arbitrator with at least five (5) years experience in
commercial real estate in general and the operation of property similar to the
Subject Phase in particular, and those two (2) arbitrators shall by
agreement select a third arbitrator having recognized expertise and at least
five (5) years experience in commercial real estate in general and property
similar to the Subject Phase in particular.

 

(c)                                  The
arbitrators selected pursuant to Section 8.25(b) above will establish
the rules for proceeding with the arbitration of the dispute, which will
be binding upon all parties to the arbitration proceeding. The arbitrators may use
the rules of the American Arbitration Association for commercial
arbitration but are encouraged to adopt the rules the arbitrators deem
appropriate to accomplish the arbitration in the quickest and least expensive
manner possible. Accordingly, the arbitrators may (i) dispense with
any formal rules of evidence and allow hearsay testimony so as to limit
the number of witnesses required, (ii) minimize discovery procedures as
the arbitrators deem appropriate, (iii) limit the time for presentation of
any party’s case as well as the amount of information or number of witnesses to
be presented in connection with any hearing, and (iv) impose any other rules which
the arbitrators believe appropriate to effect a resolution of the dispute as
quickly and inexpensively as possible. In any event, the arbitrators (A) shall
permit each side no more than two (2) depositions (including any deposition
of experts), which depositions may not exceed four (4) hours each,
one set of 10 interrogatories (inclusive of sub-parts) and one set of five (5) document
requests (inclusive of sub-parts); (B) shall not permit any requests for
admissions; (C) shall limit 

 

24

 

the hearing, if
any, to two (2) days; and (D) shall render their decision within
sixty (60) days of the filing of the arbitration.

 

(d)                                 The
arbitrators will have the exclusive authority to determine and award costs of
arbitration and the costs incurred by any party for its attorneys, advisors and
consultants.

 

(e)                                  Any
award made by the arbitrators shall be binding on the parties and all parties
to the arbitration and shall be enforceable to the fullest extent of the law.

 

(f)                                    In
reaching any determination or award, the arbitrators will apply the laws of the
state of Texas. Except as permitted under Section 8.25(d) above, the
arbitrators’ award will be limited to actual damages and will not include consequential,
special, punitive or exemplary damages. Nothing. contained in this Agreement
will be deemed to give the arbitrators any authority, power or right to alter,
change, amend, modify, add to or subtract from any of the provisions of this
Agreement. All privileges under state and federal law, including, without
limitation, attorney-client, work product and party communication privileges,
shall be preserved and protected. All experts engaged by a party must be
disclosed to the other party within fourteen (14) days after the date of notice
and demand for arbitration is given.

 

(g)                                 Notwithstanding
any provision of this Agreement to the contrary, any party may seek
injunctive relief or other form of ancillary relief at any time from any
court of competent jurisdiction in Dallas County, Texas. In the event that a
dispute or controversy requires emergency relief before the matter may be
resolved under the arbitration procedures of this Section 8.25,
notwithstanding the fact that any court of competent jurisdiction may enter
an order providing for injunctive or other form of ancillary relief, the
parties expressly agree that such arbitration procedures will still govern the
ultimate resolution of that portion of the dispute or controversy not resolved
pursuant to said court order.

 

[Signature
Page Follows]

 

25

 

Executed effective as of the date written
above.

 

 

	
   

  	
  OWNER:

  
	
   

  	
   

  
	
   

  	
  BEHRINGER HARVARD FRISCO SQUARE 

  LLC, a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gerald J. Reihsen, III

  	
   

  
	
   

  	
   

  	
  Gerald J. Reihsen, III

  
	
   

  	
   

  	
  Executive Vice President

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  15601 Dallas Parkway, Suite 600

  
	
   

  	
   

  	
  Addison, Texas 75001

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  DEVELOPER:

  
	
   

  	
   

  
	
   

  	
  FRISCO SQUARE DEVELOPMENT, LTD.,

  
	
   

  	
  a Texas limited partnership

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Fairway FS Development, LLC,

  
	
   

  	
   

  	
  a Texas limited liability company

  
	
   

  	
   

  	
  General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ James Leslie

  	
   

  
	
   

  	
   

  	
  Name:

  	
   James Leslie

  	
   

  
	
   

  	
   

  	
  Title: 

  	
  Mgr of GP

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  16250 Dallas Parkway, Suite 102

  
	
   

  	
   

  	
  Dallas, Texas 75248

  
										

 

 

EXHIBIT A

 

LEGAL DESCRIPTION

 

TRACT 4:

 

BEING a tract
of land situated in the W.B. Watkins Survey, Abstract No. 1004, Collin
County, Texas, and being all of Lot F1-1, Block F-1, Frisco Square Phase 2, an
addition to the City of Frisco, Texas recorded in Cabinet P, Page 724, Map
Records, Collin County, Texas, and
being more particularly described as follows:

 

BEGINNING at a
5/8” iron rod with red cap marked KHA set at the corner clip intersection of
the south Right-of-Way line of Main Street (variable width Right-of-Way) and
the most easterly northeast corner of Coleman Boulevard (114’ Right-of-Way) as
dedicated to the City of Frisco recorded in Cabinet N, Page 690, Map
Records, Collin County, Texas;

 

THENCE North
85°05’00” East with the south Right-of-Way line of said Main Street a distance
of 190.04 feet to a 5/8” iron rod with red cap marked KHA set for corner;

 

THENCE South
04°55’00” East departing the south Right-of-Way line of said Main Street a
distance of 96.67 feet to a 5/8” iron rod with red cap marked KHA set for
corner, said point being an inner ell corner in the north line of Lot F1-11 of
said Frisco Square Phase 2;

 

THENCE with
the north line of said Lot F1-11 the following calls:

 

South 85°05’00”
West a distance of 112.09 feet to a 5/8” iron rod with red cap marked KHA set
for corner;

 

South 07°39’03”
East a distance of 14.21 feet to a 5/8” iron rod with red cap marked KHA set
for corner;

 

South 82°20’57”
West a distance of 85.74 feet to a 5/8” iron rod with red cap marked KHA set
for corner in the east Right-of-Way line of said Coleman Boulevard;

 

THENCE with
the east Right-of-Way line of said Coleman Boulevard the following calls:

 

North 07°39’03”
West a distance of 102.58 feet to a 5/8” iron rod with red cap marked KHA set
for corner;

 

North 38°42’59”
East a distance of 17.25 feet to the POINT OF BEGINNING and containing 0.4746
acre of land.

 

 

EXHIBIT B

 

DESCRIPTION OF SUBJECT PHASE

 

Phase 1 shall consist of a 67,528 square foot building, consisting of
47,930 rentable square feet of office product and 14,906 rentable square feet
of retail product and located at the southeast corner of the intersection of
Main Street and Coleman Blvd in Frisco Square, Texas. This building shall be
known as Building C1 within the Frisco Square project (also referred to as
Building F1-1 in prior site plans).

 

Phase 1 has executed leases with Mattito’s Tex Mex Grill and with
Lochrann’s Bar and Pub as of the effective date of this Agreement.

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