Document:

EX-10.74

 Exhibit 10.74 
 Freddie Mac Loan No. 708083366 
 Crystal Park at Waterford 

GUARANTY 

(CME AND PORTFOLIO) 
 MULTISTATE 
 (Revised 7-20-2012) 

THIS GUARANTY (“Guaranty”) is entered into to be effective as of May 8, 2013 by KBS LEGACY PARTNERS PROPERTIES LLC,
a Delaware limited liability company (“Guarantor”, collectively if more than one), for the benefit of CBRE CAPITAL MARKETS, INC., a Texas corporation (“Lender”). 

RECITALS 
  

	A.	 Pursuant to the terms of a Multifamily Loan and Security Agreement dated the same date as this Guaranty (as amended, modified or supplemented from
time to time, the “Loan Agreement”), KBS LEGACY PARTNERS CRYSTAL LLC, a Delaware limited liability company (“Borrower”), has requested that Lender make a loan to Borrower in the amount of $29,380,000.00
(“Loan”). The Loan will be evidenced by a Multifamily Note from Borrower to Lender dated effective as of the effective date of this Guaranty (as amended, modified or supplemented from time to time, the “Note”). The
Note will be secured by a Purchase Money Multifamily Deed of Trust, Assignment of Rents and Security Agreement dated effective as of the effective date of the Note (as amended, modified or supplemented from time to time, the “Security
Instrument”), encumbering the Mortgaged Property described in the Loan Agreement. 

  

	B.	 As a condition to making the Loan to Borrower, Lender requires that Guarantor execute this Guaranty. 

 

	C.	 Guarantor has a direct or indirect ownership or other financial interest in Borrower and/or will otherwise derive a material benefit from the making
of the Loan. 

 AGREEMENT 
 NOW, THEREFORE, in order to induce Lender to make the Loan to Borrower, and in consideration thereof and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Guarantor agrees as follows: 
  

	1.	 Defined Terms. The terms “Indebtedness”, “Loan Documents”, and “Property Jurisdiction”,
and other capitalized terms used but not defined in this Guaranty, will have the meanings assigned to them in the Loan Agreement. 

	2.	Scope of Guaranty. 

  

	 	(a)	 Guarantor hereby absolutely, unconditionally and irrevocably guarantees to Lender each of the following: 

 

	 	(i)	 Guarantor guarantees the full and prompt payment when due, whether at the Maturity Date or earlier, by reason of acceleration or otherwise, and at
all times thereafter, of each of the following: 

  

	 	(A)	 Guarantor guarantees a portion of the Indebtedness equal to -0-% of the original principal balance of the Note (“Base Guaranty”).

  

	 	(B)	 In addition to the Base Guaranty, Guarantor guarantees all other amounts for which Borrower is personally liable under Sections 9(c), 9(d) and
9(f) of the Note (provided, however, that Guarantor will have no liability for failure of Borrower or SPE Equity Owner to comply with (I) Section 6.13(a)(xviii) of the Loan Agreement, and (II) the requirement in Section 6.13(a)(x)(B)
of the Loan Agreement as to payment of trade payables within 60 days of the date incurred). (CME loans only) 

  

	 	(C)	 Guarantor guarantees all costs and expenses, including reasonable Attorneys’ Fees and Costs incurred by Lender in enforcing its rights under
this Guaranty. 

  

	 	(ii)	 Guarantor guarantees the full and prompt payment and performance of and/or compliance with all of Borrower’s obligations under Sections 6.12,
10.02(b) and 10.02(d) of the Loan Agreement when due and the accuracy of Borrower’s representations and warranties under Section 5.05 of the Loan Agreement. 

 

	 	(b)	 If the Base Guaranty stated in Section 2(a)(i)(A) is 100% of the original principal balance of the Note, then the following will be applicable:

  

	 	(i)	 The Base Guaranty will mean and include, and Guarantor hereby absolutely, unconditionally and irrevocably guarantees to Lender, the full and
complete prompt payment of the entire Indebtedness, the performance of and/or compliance with all of Borrower’s obligations under the Loan Documents when due, and the accuracy of Borrower’s representations and warranties contained in the
Loan Documents. 

  

	 	(ii)	 For so long as the Base Guaranty remains in effect (there being no limit to the duration of the Base Guaranty unless otherwise expressly provided in
this Guaranty), the obligations guaranteed pursuant to Sections 2(a)(i)(B) and 2(a)(i)(C) will be part of, and not in addition to or in limitation of, the Base Guaranty. 

  

			
		 	Page 2

	 	(c)	 If the Base Guaranty stated in Section 2(a)(i)(A) is less than 100% of the original principal balance of the Note, then Section 2(b) will
be completely inapplicable. 

  

	 	(d)	 If Guarantor is not liable for the entire Indebtedness, then all payments made by Borrower with respect to the Indebtedness and all amounts received
by Lender from the enforcement of its rights under the Loan Agreement and the other Loan Documents (except this Guaranty) will be applied first to the portion of the Indebtedness for which neither Borrower nor Guarantor has personal liability.

  

	3.	 Guarantor’s Obligations Survive Foreclosure. The obligations of Guarantor under this Guaranty will survive any foreclosure proceeding,
any foreclosure sale, any delivery of any deed in lieu of foreclosure, and any release of record of the Security Instrument, and, in addition, the obligations of Guarantor relating to Borrower’s representations and warranties under
Section 5.05 of the Loan Agreement, and Borrower’s obligations under Sections 6.12 and 10.02(b) of the Loan Agreement will survive any repayment or discharge of the Indebtedness. Notwithstanding the foregoing, if Lender has never been
a mortgagee-in-possession of or held title to the Mortgaged Property, Guarantor will have no obligation under this Guaranty relating to Borrower’s representations and warranties under Section 5.05 of the Loan Agreement or Borrower’s
obligations relating to environmental matters under Sections 6.12 and 10.02(b) of the Loan Agreement after the date of the release of record of the lien of the Security Instrument as a result of the payment in full of the Indebtedness on the
Maturity Date or by voluntary prepayment in full. 

  

	4.	 Guaranty of Payment and Performance. Guarantor’s obligations under this Guaranty constitute an unconditional guaranty of payment and
performance and not merely a guaranty of collection. 

  

	5.	 No Demand by Lender Necessary; Waivers by Guarantor – All States Except California. The obligations of Guarantor under this Guaranty
must be performed without demand by Lender and will be unconditional regardless of the genuineness, validity, regularity or enforceability of the Note, the Loan Agreement, or any other Loan Document, and without regard to any other circumstance
which might otherwise constitute a legal or equitable discharge of a surety, a guarantor, a borrower or a mortgagor. Guarantor hereby waives, to the fullest extent permitted by applicable law, all of the following: 

 

	 	(a)	 The benefit of all principles or provisions of law, statutory or otherwise, which are or might be in conflict with the terms of this Guaranty and
agrees that Guarantor’s obligations will not be affected by any circumstances, whether or not referred to in this Guaranty, which might otherwise constitute a legal or equitable discharge of a surety, a guarantor, a borrower or a mortgagor.

  

			
		 	Page 3

	 	(b)	 The benefits of any right of discharge under any and all statutes or other laws relating to a guarantor, a surety, a borrower or a mortgagor, and
any other rights of a surety, a guarantor, a borrower or a mortgagor under such statutes or laws. 

  

	 	(c)	 Diligence in collecting the Indebtedness, presentment, demand for payment, protest, all notices with respect to the Note and this Guaranty which may
be required by statute, rule of law or otherwise to preserve Lender’s rights against Guarantor under this Guaranty, including notice of acceptance, notice of any amendment of the Loan Documents, notice of the occurrence of any default or
Event of Default, notice of intent to accelerate, notice of acceleration, notice of dishonor, notice of foreclosure, notice of protest, and notice of the incurring by Borrower of any obligation or indebtedness. 

 

	 	(d)	 All rights to cause a marshalling of the Borrower’s assets or to require Lender to do any of the following: 

 

	 	(i)	 Proceed against Borrower or any other guarantor of Borrower’s payment or performance under the Loan Documents (an “Other
Guarantor”). 

  

	 	(ii)	 Proceed against any general partner of Borrower or any Other Guarantor if Borrower or any Other Guarantor is a partnership.

  

	 	(iii)	 Proceed against or exhaust any collateral held by Lender to secure the repayment of the Indebtedness. 

 

	 	(iv)	 Pursue any other remedy it may now or hereafter have against Borrower, or, if Borrower is a partnership, any general partner of Borrower.

  

	 	(e)	 Any right to object to the timing, manner or conduct of Lender’s enforcement of its rights under any of the Loan Documents.

  

	 	(f)	 Any right to revoke this Guaranty as to any future advances by Lender under the terms of the Loan Agreement to protect Lender’s interest in the
Mortgaged Property. 

  

	6.	 Modification of Loan Documents. At any time or from time to time and any number of times, without notice to Guarantor and without affecting
the liability of Guarantor, all of the following will apply: 

  

	 	(a)	 Lender may extend the time for payment of the principal of or interest on the Indebtedness or renew the Indebtedness in whole or in part.

  

	 	(b)	 Lender may extend the time for Borrower’s performance of or compliance with any covenant or agreement contained in the Note, the Loan Agreement
or any other Loan Document, whether presently existing or entered into after the date of this Guaranty, or waive such performance or compliance. 

  

			
		 	Page 4

	 	(c)	 Lender may accelerate the Maturity Date of the Indebtedness as provided in the Note, the Loan Agreement, or any other Loan Document.

  

	 	(d)	 Lender and Borrower may modify or amend the Note, the Loan Agreement, or any other Loan Document in any respect, including an increase in the
principal amount. 

  

	 	(e)	 Lender may modify, exchange, surrender or otherwise deal with any security for the Indebtedness or accept additional security that is pledged or
mortgaged for the Indebtedness. 

  

	7.	 Joint and Several Liability. The obligations of Guarantor (and each party named as a Guarantor in this Guaranty) and any Other Guarantor will
be joint and several. Lender, in its sole and absolute discretion, may take any of the following actions: 

  

	 	(a)	 Lender may bring suit against Guarantor, or any one or more of the parties named as a Guarantor in this Guaranty, and any Other Guarantor, jointly
and severally, or against any one or more of them. 

  

	 	(b)	 Lender may compromise or settle with Guarantor, any one or more of the parties named as a Guarantor in this Guaranty, or any Other Guarantor, for
such consideration as Lender may deem proper. 

  

	 	(c)	 Lender may release one or more of the parties named as a Guarantor in this Guaranty, or any Other Guarantor, from liability.

  

	 	(d)	 Lender may otherwise deal with Guarantor and any Other Guarantor, or any one or more of them, in any manner. 

No action of Lender described in this Section 7 will affect or impair the rights of Lender to collect from any one
or more of the parties named as a Guarantor under this Guaranty any amount guaranteed by Guarantor under this Guaranty. 
  

	8.	 Limited Release of Guarantor Upon Transfer of Mortgaged Property. If Guarantor requests a release of its liability under this Guaranty in
connection with a Transfer which Lender has approved pursuant to Section 7.05(a) of the Loan Agreement, and Borrower has provided a replacement Guarantor acceptable to Lender, then one of the following will apply: 

 

	 	(a)	 If Borrower delivers to Lender a Clean Site Assessment, then Lender will release Guarantor from Guarantor’s obligation to guaranty
Borrower’s liability under Section 6.12 (Environmental Hazards) or Section 10.02(b) (Environmental Indemnification) of the Loan Agreement with respect to any indemnified matters created or arising solely from any Prohibited Activities
or Conditions first existing after the date of the Transfer, provided such loss, liability, damage, claim, 

  

			
		 	Page 5

	 	 
cost or expense does not directly or indirectly arise from or relate to any Prohibited Activities or Conditions existing prior to the date of the Transfer. 

 

	 	(b)	 If Borrower does not deliver a Clean Site Assessment as described in Section 7.05(b)(i), then Lender will release Guarantor from all of
Guarantor’s obligations except for Guarantor’s obligation to guaranty Borrower’s liability under Section 6.12 (Environmental Hazards) or Section 10.02(b) (Environmental Indemnification) of the Loan Agreement.

  

	9.	 Subordination of Borrower’s Indebtedness to Guarantor. Any indebtedness of Borrower held by Guarantor now or in the future is and will
be subordinated to the Indebtedness and Guarantor will collect, enforce and receive any such indebtedness of Borrower as trustee for Lender, but without reducing or affecting in any manner the liability of Guarantor under the other provisions of
this Guaranty. 

  

	10.	 Waiver of Subrogation. Guarantor will have no right of, and hereby waives any claim for, subrogation or reimbursement against Borrower or any
general partner of Borrower by reason of any payment by Guarantor under this Guaranty, whether such right or claim arises at law or in equity or under any contract or statute, until the Indebtedness has been paid in full and there has expired the
maximum possible period thereafter during which any payment made by Borrower to Lender with respect to the Indebtedness could be deemed a preference under the United States Bankruptcy Code. 

 

	11.	 Preference. If any payment by Borrower is held to constitute a preference under any applicable bankruptcy, insolvency, or similar laws, or if
for any other reason Lender is required to refund any sums to Borrower, such refund will not constitute a release of any liability of Guarantor under this Guaranty. It is the intention of Lender and Guarantor that Guarantor’s obligations under
this Guaranty will not be discharged except by Guarantor’s performance of such obligations and then only to the extent of such performance. 

  

	12.	 Financial Information. Guarantor, from time to time upon written request by Lender, will deliver to Lender such financial statements as
Lender may reasonably require. If an Event of Default has occurred and is continuing, Guarantor will deliver to Lender upon written request copies of its state and federal tax returns. 

 

	13.	 Assignment. Lender may assign its rights under this Guaranty in whole or in part and upon any such assignment, all the terms and provisions
of this Guaranty will inure to the benefit of such assignee to the extent so assigned. The terms used to designate any of the parties in this Guaranty will be deemed to include the heirs, legal representatives, successors and assigns of such
parties, and the term “Lender” will also include any lawful owner, holder or pledgee of the Note. 

  

	14.	 Complete and Final Agreement. This Guaranty and the other Loan Documents represent the final agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous or subsequent oral agreements. There are no unwritten oral agreements between the parties. All prior or contemporaneous agreements,

  

			
		 	Page 6

	 	 
understandings, representations, and statements, oral or written, are merged into this Guaranty and the other Loan Documents. Guarantor acknowledges that Guarantor has received a copy of the Note
and all other Loan Documents. Neither this Guaranty nor any of its provisions may be waived, modified, amended, discharged, or terminated except by a writing signed by the party against which the enforcement of the waiver, modification, amendment,
discharge, or termination is sought, and then only to the extent set forth in that writing. 

  

	15.	 Governing Law. This Guaranty will be governed by and enforced in accordance with the laws of the Property Jurisdiction, without giving effect
to the choice of law principles of the Property Jurisdiction that would require the application of the laws of a jurisdiction other than the Property Jurisdiction. 

 

	16.	 Jurisdiction; Venue. Guarantor agrees that any controversy arising under or in relation to this Guaranty may be litigated in the Property
Jurisdiction, and that the state and federal courts and authorities with jurisdiction in the Property Jurisdiction will have jurisdiction over all controversies which will arise under or in relation to this Guaranty. Guarantor irrevocably consents
to service, jurisdiction and venue of such courts for any such litigation and waives any other venue to which it might be entitled by virtue of domicile, habitual residence or otherwise. However, nothing in this Guaranty is intended to limit
Lender’s right to bring any suit, action or proceeding relating to matters arising under this Guaranty against Guarantor or any of Guarantor’s assets in any court of any other jurisdiction. 

 

	17.	 Guarantor’s Interest in Borrower. Guarantor represents to Lender that Guarantor has a direct or indirect ownership or other financial
interest in Borrower and/or will otherwise derive a material financial benefit from the making of the Loan. 

  

	18.	 State-Specific Provisions. Not applicable. 

 

	19.	 Community Property Provision. Not applicable. 

 

	20.	 WAIVER OF TRIAL BY JURY. 

  

	 	(a)	 GUARANTOR AND LENDER EACH COVENANTS AND AGREES NOT TO ELECT A TRIAL BY JURY WITH RESPECT TO ANY ISSUE ARISING OUT OF THIS GUARANTY OR THE
RELATIONSHIP BETWEEN THE PARTIES AS GUARANTOR AND LENDER THAT IS TRIABLE OF RIGHT BY A JURY. 

  

	 	(b)	 GUARANTOR AND LENDER EACH WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO SUCH ISSUE TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN THE
FUTURE. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN BY EACH PARTY, KNOWINGLY AND VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL COUNSEL. 

  

			
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	21.	 Attached Riders. The following Riders, if marked with an “X” in the space provided, are attached to this Guaranty:

  

	 	| X |	None 

  

	 	|     |	Material Adverse Change Rider 

  

	 	|     |	Minimum Net Worth/Liquidity Requirements Rider 

  

	 	|     |	Other
                                         
        

  

	22.	Attached Exhibit. The following Exhibit, if marked with an “X” in the space provided, is attached to this Guaranty: 

 

	 	| X |	Exhibit A          Modifications to Guaranty 

 
  

REMAINDER OF PAGE INTENTIONALLY LEFT BLANK; 
 SIGNATURE PAGE FOLLOWS 

  

			
		 	Page 8

 IN WITNESS WHEREOF, Guarantor has signed and delivered this Guaranty or has caused this
Guaranty to be signed and delivered by its duly authorized representative. 
  

	(a)	Name and Address of Guarantor 

			
	Name:	  	KBS Legacy Partners Properties LLC
		
	Address:	  	c/o Legacy Partners Residential, Inc.
		  	4000 E. Third Avenue, Suite 600
		  	Foster City, California 94404
		  	Attention: Guy K. Hays/Robert Calleja

  

	(b)	Guarantor represents and warrants that Guarantor is: 

 [            ] single 
 [            ] married 
 [     X    ] an entity 
  

	(c)	Guarantor represents and warrants that Guarantor’s state of residence is N/A. 

 

											
	GUARANTOR:	 		  	KBS LEGACY PARTNERS PROPERTIES LLC,
		 		  	a Delaware limited liability company
				
		 		  	By:    	 	KBS Legacy Partners Limited Partnership,
		 		  		 	a Delaware limited partnership
		 		  		 	Its Sole Member
					
		 		  		 	By:	 	 KBS Legacy Partners Apartment REIT, Inc.,
 a Maryland corporation

		 		  		 		 	Its Sole General Partner
					
		 		  		 		 	By: /s/ W. Dean
Henry                            
		 		  		 		 	Name: W. Dean
Henry                            
		 		  		 		 	Title:   Chief Executive Officer                 

  
 NOTARIAL ACKNOWLEDGMENT ON
FOLLOWING PAGE 

  

			
		 	Page 9

 STATE OF CALIFORNIA 
 COUNTY OF San Mateo 
 On May 3, 2013, before me, Alberta Sur, a Notary
Public, personally appeared W. Dean Henry, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument, and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. 

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

 WITNESS my hand and official seal. 
  

					
	Signature /s/ Alberta Sur	  	(Seal)	  	

  

			
		 	Page 10

 EXHIBIT A 
 MODIFICATIONS TO GUARANTY 
 The following modifications are made to the text of the Guaranty that
precedes this Exhibit: 
 NONE 

  

			
		 	Page A-1EX-10.75

 Exhibit 10.75 
 CRYSTAL PARK AT WATERFORD, FREDERICK, MARYLAND 
 PROPERTY MANAGEMENT AGREEMENT

 BETWEEN 
 BOZZUTO MANAGEMENT COMPANY 
 AND 

KBS LEGACY PARTNERS CRYSTAL LLC 

 TABLE OF CONTENTS 

 

							
	 	  	 	  	Page	 
			
	 Recitals
	  		  	 	1	  
	 ARTICLE 1.
	  	DEFINITIONS.	  	 	1	  
	 1.01.
	  	Definitions.	  	 	1	  
	 ARTICLE 2.
	  	APPOINTMENT AND SERVICES OF PROPERTY MANAGER.	  	 	2	  
	 2.01.
	  	Term.	  	 	2	  
	 2.02.
	  	Services of Property Manager.	  	 	3	  
	 ARTICLE 3.
	  	COMPENSATION AND EXPENSES OF PROPERTY MANAGER.	  	 	9	  
	 3.01.
	  	Fees.	  	 	9	  
	 3.02.
	  	Expenses to be Borne by Property Manager.	  	 	10	  
	 3.03.
	  	Noncustomary Services.	  	 	11	  
	 3.04.
	  	Nonpayment.	  	 	12	  
	 ARTICLE 4.
	  	PERSONNEL AND BONDING.	  	 	12	  
	 4.01.
	  	Stability of Management Team.	  	 	12	  
	 4.02.
	  	Fidelity Bond.	  	 	12	  
	 4.03.
	  	Affiliates.	  	 	13	  
	 ARTICLE 5.
	  	COMPLIANCE WITH LAWS.	  	 	13	  
	 5.01.
	  	Compliance.	  	 	13	  
	 5.02.
	  	Notice.	  	 	13	  
	 5.03.
	  	Hazardous Wastes.	  	 	13	  
	 5.04.
	  	Asbestos and Similar Compliance Matters.	  	 	14	  
	 ARTICLE 6.
	  	ACCOUNTING AND FINANCIAL MATTERS.	  	 	14	  
	 6.01.
	  	Books and Records.	  	 	14	  
	 6.02.
	  	Reports and Reconciliation of Accounts.	  	 	15	  
	 6.03.
	  	Audit.	  	 	16	  
	 6.04.
	  	Other Reports and Statements.	  	 	16	  
	 6.05.
	  	Contracts and Other Agreements.	  	 	16	  
	 6.06.
	  	Final Accounting.	  	 	16	  
	 6.07.
	  	Tax Returns.	  	 	16	  
	 6.08.
	  	Certification.	  	 	16	  
	 ARTICLE 7.
	  	BANK ACCOUNTS.	  	 	17	  
	 7.01.
	  	Property Accounts.	  	 	17	  
	 7.02.
	  	Expenses Paid from Property Bank Account.	  	 	18	  
	 ARTICLE 8.
	  	INSURANCE AND INDEMNITY.	  	 	18	  
	 8.01.
	  	INDEMNIFICATION.	  	 	18	  
	 8.02.
	  	Property Manager’s Insurance Responsibility.	  	 	20	  
	 8.03.
	  	Contract Documents; Indemnity Provisions.	  	 	21	  
	 8.04.
	  	Ratings of Insurance Companies.	  	 	21	  
	 8.05.
	  	Owner’s Insurance Responsibility.	  	 	22	  
	 8.06.
	  	Property Manager’s Duties in Case of Loss.	  	 	22	  
	 8.07.
	  	Release and Waiver of Claims.	  	 	22	  

							
	 ARTICLE 9.
	  	RELATIONSHIP OF PARTIES and REPRESENTATIONS and WARRANTIES.	  	 	23	  
	 9.01.
	  	Nature of Relationship.	  	 	23	  
	 9.02.
	  	Communications Between Parties.	  	 	23	  
	 9.03.
	  	Relationship of Owner and Property Manager with Respect to Leasing.	  	 	23	  
	 9.04.
	  	No Sales Brokerage Agreement.	  	 	23	  
	 9.05.
	  	Confidentiality.	  	 	24	  
	 9.06.
	  	Property Manager Not to Pledge Owner’s Credit.	  	 	24	  
	 9.07
	  	Representations and Warranties.	  	 	24	  
	 ARTICLE 10.
	  	TERMINATION.	  	 	25	  
	 10.01.
	  	Termination by Owner Without Cause.	  	 	25	  
	 10.02.
	  	Termination by Owner for Cause.	  	 	25	  
	 10.03.
	  	Termination by Property Manager.	  	 	25	  
	 10.04.
	  	Orderly Transition.	  	 	26	  
	 10.05.
	  	Rights Which Survive Termination or Expiration.	  	 	26	  
	 ARTICLE 11.
	  	MISCELLANEOUS.	  	 	26	  
	 11.01.
	  	Governing Law.	  	 	26	  
	 11.02.
	  	Table of Contents and Headings.	  	 	26	  
	 11.03.
	  	Entire Agreement.	  	 	26	  
	 11.04.
	  	Successors and Assigns.	  	 	26	  
	 11.05.
	  	Waiver.	  	 	27	  
	 11.06.
	  	Severability.	  	 	27	  
	 11.07.
	  	Time.	  	 	27	  
	 11.08.
	  	Attorneys’ Fees.	  	 	27	  
	 11.09.
	  	Further Acts.	  	 	27	  
	 11.10.
	  	No Advertising.	  	 	27	  
	 11.11.
	  	Signs.	  	 	28	  
	 11.12.
	  	Exculpatory Clause; Waivers of Jury Trial and Punitive Damages.	  	 	28	  
	 11.13.
	  	Notices.	  	 	28	  
	 11.14.
	  	Counterparts.	  	 	29	  
	 11.15.
	  	Accessibility Provisions.	  	 	29	  

  

			
	 EXHIBITS:
	  	

					
			
		 	 A -
	  	    LEGAL DESCRIPTION
			
		 	 B -
	  	    RENTAL GUIDELINES
			
		 	 C -
	  	    STANDARD RESIDENTIAL LEASE FORM

 PROPERTY MANAGEMENT AGREEMENT 

This PROPERTY MANAGEMENT AGREEMENT (this “Agreement”) is made as of May 8, 2013 (the
“Effective Date”) between BOZZUTO MANAGEMENT COMPANY, a Maryland corporation (“Property Manager”), and KBS Legacy Partners Crystal LLC, a Delaware limited liability company (“Owner”). 

RECITALS 
 A.        Owner is the record or beneficial owner of the Property (as defined below) and Property Manager is experienced in the management, operation, leasing,
service, repair and supervision of residential apartment projects similar to the Property. 

B.        The parties desire to enter into this Agreement and set forth the
terms and conditions under which Property Manager will manage the Property. 
 NOW, THEREFORE, in
consideration of the mutual covenants herein contained and other good and valuable consideration, Owner and Property Manager agree as follows: 
 AGREEMENT 
 ARTICLE 1. DEFINITIONS. 

1.01.    Definitions.  As used in this Agreement, the following terms shall have the
respective meanings set forth below: 
  “Affiliate” shall mean, when used with respect to any
person (a) if such person is a corporation, any officer or director thereof and any person which is directly, or indirectly, the beneficial owner of more than 10% of any class of equity security (as defined in the Securities Exchange Act of
1934) thereof, or if any such beneficial owner is a partnership, any partner thereof, or if any such beneficial owner is a corporation, any person controlling, controlled by or under common control with such beneficial owner or of any officer or
director of such beneficial owner or of any corporation occupying any such control relationship, (b) if such person is a partnership, any partner thereof, and (c) any other person which directly or indirectly controls or is controlled by
or is under common control with such person. For the purpose of this definition, “control” (including the correlative meanings of the term “controlling,” “controlled by” and “under common control with”), with
respect to any person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person, whether through the ownership of voting securities or by contract or otherwise.
The term “Affiliate” shall also mean, when used with respect to any individual, the parents and grandparents of such individual, the parents and grandparents of any other individual who is an Affiliate of such individual by virtue of any
one or more of the foregoing clauses (a), (b) and (c) of this definition, any descendant (whether natural or adopted) of any such parents or grandparents and any spouse of any such descendant. 

  
 1 

 “Annual Business Plan” shall have the meaning described in
Section 2.02(q). 
 “Approved Capital Budget” and “Approved Operating Budget” shall
have the meanings described in Section 2.02(b). 
 “Fiscal Year” shall mean the twelve
(12) months commencing January 1 and ending December 31. 
 “Gross Monthly
Collections” shall mean the total gross monthly collections received from the Property, including, without limitation, tenant rental income, pet rents and other charges and miscellaneous income items of Owner as applicable. Insurance proceeds
for lost or unpaid rent, including without limitation, insurance proceeds from business interruption insurance related to lost or unpaid rent, are includable in Gross Monthly Collections. Any payments by tenants on account of any taxes imposed on
rentals collected by Property Manager shall be excluded from Gross Monthly Collections. Any advance rental payments shall be included in Gross Monthly Collections when received. Security and other deposits shall not be included therein unless the
same are no longer used for security purposes and are applied to income. Without limitation, any payment of money by a tenant to Owner or Property Manager in consideration for or in conjunction with a rental deposit, the termination, cancellation,
expiration, renewal, extension or modification of a tenant’s lease, property insurance loss proceeds, remodeling and tenant improvement charge costs, condemnation proceeds, or proceeds received by Owner in connection with the sale of any
portion of the Property or the refinancing of any indebtedness secured by a lien on any portion of the Property, shall be excluded from the Gross Monthly Collections. Proceeds of business interruption insurance shall be included in Gross Monthly
Collections. 
 “Property” shall mean that certain real property consisting of approximately
        (        ) acres and improvements constructed thereon consisting of Three Hundred Fourteen (314) residential units (commonly known as the Crystal Park at
Waterford) and zero (-0-) square feet of retail space located in the Frederick County, Maryland as more particularly described on Exhibit A attached hereto. 
 “Records Office” shall mean Property Manager’s offices located at the Property and its corporate office in Greenbelt, Maryland. 

“Rental Guidelines” shall mean those guidelines attached hereto as Exhibit B, as amended from time to time.

 ARTICLE 2.  APPOINTMENT AND SERVICES OF PROPERTY MANAGER. 

2.01.    Term.    Owner hereby hires Property Manager as the exclusive
manager of the Property upon the terms and conditions herein stated, and Property Manager hereby accepts said engagement, for a term beginning on the date of this Agreement and ending at 12:00 midnight on the one-year anniversary of the beginning
date, unless sooner terminated by Owner or Property Manager as provided in Article 10 of this Agreement. At the expiration of said term, this Agreement, if not renewed in writing by Owner and Property Manager, shall then be deemed a
month-to-month 

  
 2 

 
agreement cancelable by either party on not less than thirty (30) days’ advance written notice, which notice may be given at any time during a month, provided that in any event the
cancellation shall be effective at the end of the calendar month in which the thirty (30) day notice period ends. 
 2.02.      Services of Property Manager.    Property Manager shall direct, supervise, manage, operate, maintain and repair the Property and
develop, institute and follow programs and policies to facilitate the efficient operation of the Property in compliance with this Agreement, the Rental Guidelines and all written directions of Owner on as profitable a basis as reasonably possible.
Without limiting the generality of the foregoing and subject at all times to such procedures and directions that shall be set forth in this Agreement and the Rental Guidelines (as revised or amended from time to time), Property Manager shall do all
of the following: 

(a)        Employees.    Property
Manager shall select, employ, pay, supervise and discharge all employees and personnel necessary for the operation, maintenance and protection of the Property (subject to the limitations set forth in Section 4.01 hereof). All persons so
employed by Property Manager shall be employees of Property Manager or independent contractors retained by Property Manager, and not by Owner. All costs of gross salary and wages, payroll taxes, medical and dental insurance, worker’s
compensation insurance, incentive leasing bonuses and other costs and employee benefit expenses payable on account of such employees, shall be included in the Approved Operating Budget. Property Manager shall fully comply with all applicable laws
and regulations having to do with workers’ compensation, social security, unemployment insurance, hours of labor, wages, working conditions and other employer/employee-related subjects. 

(b)        Records and
Budgets.    Property Manager shall keep or cause to be kept at the Records Office suitable books of control and account as provided in this Agreement. Property Manager shall prepare on Microsoft Excel worksheets (using Yardi
templates) and submit to Owner such monthly, quarterly, annual or other operating and capital budgets as shall be required by Owner. Without limitation, Property Manager shall prepare and submit to Owner a proposed operating budget and a proposed
capital budget for the Property for the management and operation of the Property for the forthcoming Fiscal Year no later than November 1 of each year during the term hereof. All proposed operating budgets and capital budgets shall be on a form
submitted by Property Manager and approved by Owner. Owner will consider the proposed budgets and endeavor to approve such budgets by December 1 of each year during the term hereof. The proposed budgets shall become the Approved Capital Budget
and the Approved Operating Budget only when approved by Owner. Following approval by Owner the Approved Capital Budget and the Approved Operating Budget shall be promptly uploaded into the Yardi accounting system for the Property. 

In the event an annual operating budget for a Property has not been approved by Owner prior to the
commencement of any Fiscal Year during the term hereof, the operating budget for each month (the “Current Month”) until the annual operating budget is approved shall be the amount of the most recent Approved Operating Budget for the
Property for the same calendar month (“Base Month”), as adjusted to reflect (a) any increase or decrease between the Base Month and the Current Month in the Consumer Price Index for All Urban

  
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Consumers for the metropolitan area in which the Property is located (base year 1982-84=100) published by the United States Department of Labor, Bureau of Labor Statistics and (b) any
increase or decrease in the occupancy of the Property between the Base Month and the Current Month and (c) any increase or decrease in the taxes, insurance and utilities of the Property. 

Owner may revoke its approval of either Budget at any time upon twenty (20) days’ prior written
notice to Property Manager. Owner may amend its approval of either Budget and cause the Budget to be amended to conform to such approval at any time upon twenty (20) days’ prior written notice to Property Manager and, in such event, only
the Budget as so amended shall be deemed approved. 
 With respect to the first Fiscal Year of
the term, if not a full twelve months, Property Manager shall submit to Owner for approval an operating and capital budget for the balance of such calendar year as soon as possible and no later than thirty (30) days after the date hereof.

 Property Manager shall have the right, from time to time, during each calendar year to submit
revised Budgets to Owner for approval. Property Manager agrees to use diligence and all reasonable efforts to ensure that the actual costs of maintaining and operating the Property shall not exceed the Approved Operating Budget or the Approved
Capital Budget pertaining thereto, as applicable. 

(c)        Leasing.    Property
Manager shall coordinate the leasing activities of the Property and, subject to Section 9.03 below, shall use commercially reasonable efforts to obtain responsible tenants for all unleased units and to renew existing leases at rental rates at
least equal to the Rental Guidelines. Property Manager may negotiate and execute leases using the standard lease forms for Owner approved by Owner and attached hereto as Exhibit C. Any deviation from the standard lease forms or the Rental Guidelines
shall require the prior written consent of Owner. 

(d)        Rent.  Property Manager shall use
reasonable efforts to ensure that all rents and all other monies payable under the leases are paid by the tenants of the Property as and when the same shall become due and payable directly to Property Manager. Property Manager shall adjust rentals
and other required payments where adjustment is contemplated by the leases, shall notify Owner and tenants of such adjustments and shall sign and serve in the name of Owner such notices (except as limited by Section 2.02(e) below), including
without limitation letters demanding past due and currently owed rents and other monies, as are deemed appropriate or necessary by Property Manager. Property Manager shall collect and identify any income due Owner from miscellaneous services
provided to tenants or the public, including, but not limited to, parking income, tenant storage and cable television charges. All rents and other monies so collected by Property Manager shall be immediately deposited in the Property Bank Account
(as defined below). 

  
 4 

(e)        Collections.    Property
Manager shall undertake the collection of rents and monetary payments of every kind and of any form due from tenants of the Property. Property Manager shall thereafter actively pursue collection of all such rent and payments. Except as allowed by
applicable law, Property Manager shall not terminate any lease, lock out a tenant, institute a suit for rent or for use and occupancy, or institute proceedings for recovery of possession. In the event that any tenant at the Property shall be
delinquent in any payment due to Owner beyond any applicable grace periods or otherwise be in default under the terms of its lease, Property Manager shall employ such methods as are commercially reasonable to either collect unpaid rent or to evict
the tenant from the premises. Property Manager shall employ a collection agency to pursue payment collection and, except as otherwise required by applicable law, shall utilize legal counsel only if a tenant refuses to vacate an apartment unit
following proper notice. The commencement of any litigation (other than for routine residential tenant eviction and residential rent collection matters, including bringing suit for and recovery of any delinquent rents or damages and possession of
the premises in the name of Owner as an agent with a beneficial interest), shall require the prior written approval of Owner. In connection with all suits or proceedings (other than for routine residential tenant eviction and residential rent
collection matters, including bringing suit for and recovery of any delinquent rents or damages and possession of the premises in the name of Owner as an agent with a beneficial interest), only legal counsel approved by Owner shall be retained, but
Property Manager shall recommend legal counsel and furnish Owner with the estimated costs of legal services to be incurred in bringing such suit or proceeding. 

(f)        Maintenance.    To the
extent permitted by the Approved Operating Budget, Property Manager shall maintain or cause to be maintained (to the extent not maintained by tenants) the Property and common areas thereof, external and internal, including, without limitation,
sidewalks, signs, mechanical, electrical and other systems, parking lots and landscaping, in good and clean condition and repair, provided no maintenance expense, repairs or alterations other than emergency repairs, which are not specifically
identified within the Approved Operating Budget, shall be undertaken without the prior written consent of Owner. Property Manager shall coordinate and supervise all construction activities (including, without limitation, tenant improvements, tenant
refurbishment, common area refurbishment, maintenance and repairs) on the Property. All maintenance expenses, repairs or alterations (including, without limitation, alterations required for the occupancy of new tenants) requiring expenditures in
excess of $25,000 shall, at Owner’s election, be planned and supervised by an architect, designer, inspector or general contractor designated by Property Manager and approved in writing by Owner. Property Manager shall institute and effectuate
a preventative maintenance program. Notwithstanding the foregoing, in the event of an emergency in which there is an immediate danger to persons or property or in which action is required in order to avoid suspension of services, Property Manager
shall take such action as is reasonable and prudent under the circumstances and shall be reimbursed for any expense incurred in such action, even if not in the Approved Operating Budget, so long as Property Manager attempts, if reasonably possible,
to consult with Owner in advance and, in any event, notifies Owner within 48 hours of taking such action explaining the reasons therefor. Property Manager shall obtain all necessary receipts, releases, waivers, discharges and assurances necessary to
keep the Property free of any mechanics’, laborers’, materials 

  
 5 

 
suppliers’ or vendors’ liens in connection with the maintenance or operation of the Property. All such documentation shall be in such form as required by Owner. 

(g)       Contracts.      
Property Manager shall not enter into any contract without Owner’s prior written approval (including approval of the provisions of any equipment lease); provided, however, that Owner’s prior written approval shall not be required with
respect to any utility or service contract which is (i) entered into in the usual course of business, (ii) for a term of one year or less, and (iii) specifically provided for in the Approved Operating Budget. Without limiting the
foregoing, each contract entered into by Property Manager pursuant to this Section 2.02(g) shall contain a thirty (30) day (or less) cancellation clause exercisable by Owner without cause and without penalty or fee, unless otherwise
approved in writing by Owner. All utility, supply, service, vending and related contracts or equipment leases are to be entered into by Property Manager on behalf of Owner. Property Manager shall assure that any contractor performing work on the
Property maintains insurance satisfactory to Owner, including, but not limited to, Workers’ Compensation Insurance (and, when required by law, compulsory Non-Occupational Disability Insurance) and insurance against liability for injury to
persons and property arising out of all such contractor’s operations naming Property Manager and Owner as additional insureds. Property Manager shall obtain certificates of insurance for all such insurance before the work begins. Property
Manager shall furnish copies of the certificates to Owner if requested by Owner. 

(h)       Purchases.    Property Manager
shall supervise and purchase or arrange for the purchase of all reasonable inventories, provisions, supplies and operating equipment which are provided for in the Approved Operating Budget or otherwise specifically approved by Owner in writing. To
the extent available, Property Manager shall give, or obtain for Owner, all volume purchasing benefits and discounts available to Property Manager or to properties of the size and class of the Property. 

(i)        Operating
Expenses.      Property Manager shall pay all normal operating expenses specifically provided for in the Approved Operating Budget not paid for by tenants of the Property in a manner commercially reasonable for the
Property from funds in the Property Bank Account described in Section 7.01(a). Property Manager shall recommend that Owner purchase major items of new or replacement equipment when Property Manager believes such purchase to be necessary or
desirable. Owner may arrange to purchase and install such items itself or may authorize Property Manager to do so subject to any supervision and specification requirements and conditions prescribed by Owner. Prior to purchasing, Property Manager
must obtain Owner’s specific written authorization for all capital expenditures that are not included in the Approved Capital Budget as well as for all capital expenditures of $25,000 or more that are included and itemized with specificity in
any one (1) line item in the Approved Capital Budget. Unless otherwise directed by Owner, Property Manager shall obtain at least three (3) written estimates from qualified bidders for any capital improvement project if the cost of such
project is reasonably expected to exceed $25,000. All capital improvement projects requiring expenditures in excess of $25,000 shall, at Owner’s election, be planned and supervised by an architect, designer, inspector or general contractor
designated by Property Manager and approved in writing by Owner. 

  
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(j)        Conservation
Techniques.    Property Manager shall provide proper energy management and utilize utility conservation techniques. 
 (k)       Security.    Property Manager shall use reasonable efforts to maintain security adequate to the needs of the Property as directed by
Owner from time to time. Property Manager shall promptly notify Owner of any incidents or conditions which reflect on or affect the adequacy of the security provisions for the Property. 

(l)        Taxes.    Property Manager
shall obtain and cause to be verified bills for real estate and personal property taxes, sales taxes on rental payments, improvement assessments and other like charges which are or may become liens against any portion of the Property (collectively,
“Taxes”). Owner may elect to pay some or all of such bills for Taxes and, in such event, Property Manager shall remit all bills for Taxes to Owner not less than thirty (30) calendar days prior to the date on which each becomes
delinquent or within five (5) business days of such instruction from Owner, whichever is later. Upon Property Manager’s receipt of written notice from Owner of Owner’s election to pay a bill for Taxes, Property Manager shall pay such
bill not less than fifteen (15) calendar days prior to the date on which it becomes delinquent or within five (5) business days of such instruction from Owner, whichever is later. If Owner decides to contest any Taxes, Owner shall advise
Property Manager and Property Manager shall not pay such Taxes until directed by Owner. 

(m)      Compliance.    Property Manager shall
operate the Property in compliance with all terms and conditions of applicable law, any ground lease, space lease, mortgage, deed of trust or other security instrument affecting the Property and of which Property Manager has knowledge, but Property
Manager shall not be required to make any payment (except those provided in the Approved Operating Budget) on account thereof unless specifically instructed to do so by Owner in writing. Property Manager shall also comply or supervise compliance
with the provisions of any insurance policy or policies insuring Owner in relation to the Property (so as not to decrease the insurance coverage or increase the insurance premiums). Property Manager shall be responsible for performance by Owner
under all license agreements, easement agreements, covenants, conditions, restrictions, documents of record, use permits, development agreements, operating agreements or other similar documents governing or applicable to the title, operation,
management, occupancy, promotion and leasing of the Property known to Property Manager. 

(n)       Licenses and Permits.    Property
Manager shall assist in obtaining at Owner’s expense all licenses, permits or other instruments required for the operation of the Property or any portion thereof (collectively, “Licenses”). Property Manager shall send to Owner
a copy of all initial or renewal license applications. Licenses shall be obtained in Owner’s name whenever possible. Any Licenses held in the name of Property Manager shall be held by it on behalf of Owner, and upon the termination or
expiration of this Agreement, Property Manager shall transfer or assign any such Licenses to Owner or to such person as Owner may direct. Property Manager shall keep in full force and effect all licenses, permits, consents and authorizations as may
be necessary for the proper performance by Property Manager of its 

  
 7 

 
duties and obligations under this Agreement (including, without limitation, qualification to do business) or as may be required under any lease covering any portion of the Property. All such
licenses, permits, consents and authorizations shall be in the name of Property Manager. 

(o)        Notice and Cooperation in Legal
Proceedings.    Owner and Property Manager shall forthwith give notice to each other of the commencement of any action, suit or proceeding against Owner or against Property Manager with respect to the operations of the
Property or otherwise affecting the Property. Property Manager shall fully cooperate, and shall cause all its employees to fully cooperate, in connection with the prosecution or defense of all legal proceedings affecting the Property. 

(p)        Other Complaints and
Notices.    Property Manager shall handle promptly complaints and requests from tenants, concessionaires and licensees and notify Owner of any major complaint made by a tenant, concessionaire or licensee. Property Manager
shall notify Owner promptly of: (i) any notice received by Property Manager or known to Property Manager of violation of any governmental requirements (and make recommendations regarding compliance therewith); (ii) any defect or unsafe
condition in the Property known to Property Manager; (iii) any notice received by Property Manager or known to Property Manager of violation of covenants, conditions and restrictions affecting the Property or noncompliance with loan documents
affecting the Property, if any; (iv) any fire, accident or other casualty or damage to the Property; (v) any condemnation proceedings, rezoning or other governmental order, lawsuit or threat thereof involving the Property; (vi) any
violations relative to the leasing, use, repair and maintenance of the Property under governmental laws, rules, regulations, ordinances or like provisions; (vii) defaults under any leases or other agreements affecting the Property (excluding
resident leases); or (viii) any violation of any insurance requirement. Property Manager shall promptly deliver to Owner copies of any documentation in its possession relating to such matters. Property Manager shall keep Owner reasonably
informed of the status of the particular matter through the final resolution thereof. In the case of any fire or other damage to the Property or violation or alleged violation of laws respecting Hazardous Wastes (as defined in Section 5.03),
Property Manager shall immediately give telephonic notice thereof to Owner. Property Manager shall complete all necessary and customary loss reports in connection with any fire or other damage to the Property. Property Manager shall retain in the
records it maintains for the Property copies of all supporting documentation with reference to such notices. 
 (q)        Business Plan and Property Review Program.    Property Manager shall provide Owner with a draft of a business plan for the
Property for the forthcoming Fiscal Year no later than November 1 of each year during the term hereof containing such information as Owner may reasonably request, including (i) a list of all properties competitive with the Property, a list
of the tenants of each and all other reasonably available information respecting each, and (ii) basic demographic data relating to the market area of the Property, including population growth, major employers, employment and unemployment levels
and, if the Property is a retail property, retail sales and housing starts. With respect to the first Fiscal Year of the term, Property Manager shall submit to Owner for approval a draft of a business plan for the balance of such calendar year as
soon as possible and no later than thirty (30) days after the date hereof. Owner will 

  
 8 

 
consider the business plans and endeavor to approve such business plans by December 1 of each year during the term hereof. The proposed business plans shall become the Annual Business Plan
only when approved by Owner. In addition, Property Manager shall participate in Owner’s property review programs to the extent requested by Owner. Such review shall include asset, investment, financial and strategy profiles in form and
substance satisfactory to Owner and such assistance as Owner may request in connection with appraisals of the Property. Property Manager shall respond, within 10 days, to Owner’s management evaluation reports concerning actions to be taken by
Property Manager to correct or modify its management standards for the operations or financial services provided for the Property. 
 (r)        General.    Property Manager shall afford such supervision, professional management and in-house staff services as may be
necessary or desirable to operate the Property in the same manner as is customary and usual in the operation of other properties of substantially comparable location, class, size and standing, and shall provide such services at the Property as are
consistent with the Property’s size and existing facilities. Subject only to those express limitations set forth in this Agreement, Property Manager shall have control and discretion in the management and operation of the Property and in the
performance of the foregoing services. 
 ARTICLE 3. COMPENSATION AND EXPENSES OF PROPERTY MANAGER. 

 

	3.01.	Fees. 

 (a)        Owner shall pay Property Manager, and Property Manager shall accept as full compensation for the property management services to be rendered to Owner
hereunder during the term hereof, a sum equivalent to Three percent (3%) of Gross Monthly Collections (the “Management Fee”). Such compensation shall be payable monthly on or before the 20th of the subsequent month. 

(b)        In the event that Property Manager is requested by
Owner to coordinate and supervise major repairs or improvements to a Property (after its development is completed) that should be capitalized under generally accepted accounting principles (“Capital Expenditures”), Property Manager
shall receive a mutually acceptable construction supervision fee to be set forth in a separate written agreement between Property Manager and Owner (the “Construction Supervision Fee”). 

(c)        If the Property includes retail space, Owner may agree
to pay a leasing commission (the “Retail Commission”) to Property Manager, at a rate to be agreed upon, for retail leases executed during the term of this Agreement between Owner and the retail tenants procured or obtained by
Property Manager. Notwithstanding the foregoing, Owner shall have the right in its sole and absolute discretion to reject any prospective retail lease, renewal or extension agreement and, in such event, no Retail Commission or other compensation
shall be earned or payable in connection with such proposed retail lease, renewal or extension agreement or the activities of Property Manager, or any other broker in connection therewith. 

  
 9 

 (d)        Except
with respect to other services provided by Affiliates of Property Manager in accordance with Section 3.01(e), which shall be reimbursed by Owner pursuant to Section 3.01(e), Property Manager shall pay from the Management Fee all costs
associated with or relating to its own office overhead and management personnel not located or employed at the Property, including without limitation, the salaries, wages and all other compensation, together with associated unemployment and social
security taxes and contributions, as well as expenses specifically stated in this Agreement to be borne by Property Manager. 
 (e)        If included in the Approved Capital Budget or with the prior approval and direction of Owner, Property Manager may obtain services and materials
including, but not limited to, advertising, consulting, training, computer hardware and software, forms for use at the Property, contract services, accounting and bookkeeping services and building materials through the organization, subsidiaries or
Affiliates of Property Manager for the benefit of the Property, provided the quality of service and the price thereof is competitive with comparable prices and services offered by third parties, and the costs therefore shall be reimbursed by Owner.
All discounts, rebates and other savings realized thereon by Property Manager are to be passed on to Owner, in full. 
 (f)        Interest.    All amounts to be paid by Owner to Property Manager pursuant to this Agreement which are not paid within fifteen
(15) days of when same are due, shall bear daily interest at the rate of the “prime rate” published in The Wall Street Journal plus five percent (5%). 
 3.02.    Expenses to be Borne by Property Manager.    Unless otherwise provided in the Approved Operating Budget or Section 4.01(b) below, expenses
incurred in rendering all overall supervisory, lease negotiation (exclusive of lease commissions, if any, and the lease negotiations of on-site personnel), rent and other collection (exclusive of on-site personnel, attorneys’ fees and outside
collection agency fees), lease enforcement (exclusive of on-site personnel and attorneys’ fees), lease termination (exclusive of on-site personnel and attorneys’ fees), management (exclusive of on-site personnel), accounting, bookkeeping
(exclusive of checks and bank charges) and recordkeeping and other services to be rendered by Property Manager in connection with the operations of the Property shall be borne by Property Manager and not charged to Owner. Without limiting the
generality of the foregoing provisions of this section, the following expenses and costs incurred by and/or on behalf of Property Manager shall be at the sole cost and expense of Property Manager and shall not be reimbursed by Owner: 

(a)        All costs of gross salary and wages, payroll taxes,
insurance, workmen’s compensation and other costs of Property Manager’s corporate office and executive personnel (other than full time or part time personnel whose positions and salaries are specifically authorized in the Approved
Operating Budget); 

  
 10 

 (b)        All costs
incurred as a result of Property Manager’s breach of this Agreement, and/or the negligence and/or willful misconduct of Property Manager and/or any one or more of its Affiliates, employees, independent contractors, agents and/or other
representatives; 
 (c)        Unless otherwise provided
in the Approved Operating Budget, all costs of forms, accounting materials, administrative materials, papers, ledgers and other supplies and equipment used in Property Manager’s corporate office, all costs of Property Manager’s data
processing equipment located at Property Manager’s corporate office and all costs of data processing provided by computer service companies to Property Manager’s corporate office; 

(d)        All costs of bonuses, incentive compensation, profit
sharing or any pay advances to employees employed by Property Manager in connection with the operation and management of the Property, except for payments to individuals specifically set forth in the Approved Operating Budget or otherwise approved
in writing by Owner in advance; 
 (e)        All costs
of automobile purchases and/or rentals, unless provided for in the Approved Operating Budget or Approved Capital Budget or the automobile is being provided by Owner; 

(f)         All costs of comprehensive crime insurance
purchased by Property Manager for its own account; 

(g)        All costs of meals, travel and hotel accommodations
for Property Manager’s home or regional office personnel who travel to and from the Property, unless expressly authorized by Owner; and 
 (h)        All costs (exclusive of fees that are directly property related, e.g., registration fee) of obtaining and maintaining such licenses, permits,
consents and authorizations as are required by Section 2.02(n). 
 3.03.  Noncustomary
Services.    Notwithstanding anything provided in this Agreement to the contrary, Property Manager shall not furnish or render to the tenants of the Property services other than those services customarily furnished to tenants
of properties similar to the Property unless: (a) Property Manager makes a separate, adequate charge to tenants for such services; (b) such separate charge is received and retained by Property Manager; (c) Property Manager bears the
cost of providing such services; (d) Property Manager first obtains the consent in writing of Owner; and (e) Property Manager certifies in writing to Owner that (i) Property Manager qualifies as an independent contractor
with respect to Owner (and Owner’s direct and indirect beneficial owners) under Section 856(d)(3) of the Internal Revenue Code, and (ii) Owner (and Owner’s direct and indirect beneficial owners) does not
derive or receive any income from Property Manager. For purposes of this Section 3.03, it is agreed, without limitation, that the furnishing of water, heat, light and air conditioning, public entrances and exits, the performance of general
maintenance and of janitorial services and cleaning services, the collection of trash, watchmen or guard services and parking facilities are examples of services customarily furnished to the tenants of similar properties. 

  
 11 

 3.04.    Nonpayment.    If Property Manager
fails to make any payment when required or fails to perform any act required under this Agreement, to the extent sufficient funds are available, then Owner, after ten (10) days’ written notice to Property Manager (or, in the case of any
emergency, without notice) and without waiving or releasing Property Manager from any of its obligations hereunder, and Property Manager’s failure to cure, may (but shall not be required to) make such payment or perform such act. Owner shall
have (in addition to any other right or remedy) the right to offset all costs and expenses incurred in exercising its rights under this Section 3.04 against any sums due or to become due to Property Manager, including, without limitation, the
Management Fee. 
 ARTICLE 4.  PERSONNEL AND BONDING. 

4.01.    Stability of Management Team.  Owner and Property Manager recognize the benefits inherent
in promoting stability in the management team engaged in the operation of the Property. 

(a)        Property Manager shall, in the hiring of all employees
and in retaining independent contractors, use reasonable care to select qualified, competent and trustworthy employees and independent contractors. Subject to the provisions of this Section 4.01, the selection, terms of employment (including
rates of compensation) and termination thereof, and the supervision, training and assignment of duties of all employees of Property Manager engaged in the operation of the Property shall be the duty and responsibility of and shall be determined by
Property Manager. All personnel at the Property shall be employees of Property Manager and/or contractors of Property Manager. 
 (b)        Property Manager shall employ at Property Manager’s sole cost and expense (unless otherwise provided in the Approved Operating Budget) at least the
following for the Property: 
 (i)        a manager who works from the
Records Office and manages the Property and other properties (the costs and expenses for whom, if provided for in the Approved Operating Budget, shall be pro rated in light of the time spent managing the Property as opposed to other properties); and

 (ii)        an accountant working on Property
matters and other properties (who shall be part of Property Manager’s in-house staff) who works from a central location (the costs and expenses for whom, if provided for in the Approved Operating Budget, shall be pro rated in light of the time
spent working on the Property as opposed to other properties). 
 4.02.    Fidelity
Bond.  Property Manager, at Property Manager’s cost, shall obtain a fidelity bond or bonds covering Property Manager, and all persons who handle, have access to, or are responsible for, Owner’s monies in such amount and in
such forms as are reasonably acceptable to Owner, at all times and to cover all periods, during the term of this Agreement. Any changes in such bond(s) must be approved by Owner. Property Manager hereby agrees to add Owner as a joint loss payee
under its blanket crime policy as it pertains to the Property. Property Manager hereby assigns all proceeds of said bond(s) as they relate to the Property to Owner and agrees to execute such further assignments

  
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and notices thereof as shall be required by Owner. Such bond(s) shall indemnify Owner against any loss of money or other property which Owner shall sustain through any criminal, fraudulent or
dishonest act or acts committed by Property Manager or any of its employees or agents, during the performance of their obligations under this Agreement or their employment. Alternatively, Property Manager may obtain a crime insurance policy covering
the Property Manager, and all persons who handle, have access to, or are responsible for, Owner’s monies which shall be obtained at Manager’s sole expense and shall provide Owner coverage of Two Million Dollars ($2,000,000.00) per
occurrence with a Fifty Thousand Dollar ($50,000.00) deductible which deductible shall be an expense of Manager. Owner shall be furnished by Property Manager with a certificate or other satisfactory documentation relating to the bond(s) or
alternative crime insurance policy immediately upon issuance thereof. 
 4.03.    Affiliates.  Property
Manager shall not contract for outside services for the Property with any Affiliate of Property Manager without the prior written consent of Owner. 
 ARTICLE 5. COMPLIANCE WITH LAWS. 

5.01.    Compliance.    Property Manager shall comply fully with and abide by all laws, rules,
regulations, requirements, orders, notices, determinations and ordinances (collectively, “Requirements”) of any federal, state or municipal authority to the extent applicable, including, but not by way of limitation, the federal
Occupational Safety and Health Act (OSHA) statutes, rules and regulations, and all requirements of the insurers of the Property and Owner’s liabilities with regard thereto. If the cost of compliance is (i) not included in the Approved
Operating Budget or Approved Capital Budget or (ii) in excess of $10,000, Property Manager shall notify Owner promptly and obtain Owner’s prior written approval prior to making the expenditure. 

5.02.    Notice.    Property Manager shall promptly notify Owner of any non-compliance with, or alleged
violation of, any Requirement after becoming aware of the same. 
 5.03.    Hazardous Wastes. 

(a)        Property Manager shall not place, cause or permit to
be placed on the Property, other than in the ordinary course of performing its obligations under this Agreement and in compliance with applicable law, any hazardous or toxic wastes or substances, as such terms are defined by federal, state or
municipal statutes or regulations promulgated thereunder (collectively, “Hazardous Wastes”). If Property Manager discovers the existence of any Hazardous Wastes on the Property (other than Hazardous Wastes used, generated or stored
in the ordinary course of business and in compliance with applicable law), Property Manager shall immediately notify Owner. If such Hazardous Wastes were placed or knowingly permitted to be placed on the Property by Property Manager, Property
Manager shall, at its cost, diligently arrange for and complete the immediate removal thereof in accordance with applicable laws and Owner’s directions. Except as expressly provided herein to the contrary, Property Manager shall not be
responsible for any Hazardous Wastes present on the Property prior to the Effective Date hereof, unless deposited thereon by Property Manager, nor shall Property Manager be responsible for any Hazardous Wastes brought onto the Property by a person
other than Property Manager, its agents 

  
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or employees. Property Manager shall immediately notify Owner of any notice received by Property Manager from any governmental authority of any actual or threatened violation of any applicable
laws, regulations or ordinances governing the use, storage or disposal of any Hazardous Wastes and shall cooperate with Owner in responding to such notice and correcting or contesting any alleged violation at Owner’s expense. 

(b)        Property Manager shall provide its employees, agents,
consultants, governmental entities and the public with any notices or disclosures concerning Hazardous Wastes associated with the Property required to be delivered by Property Manager under any applicable laws, including without limitation, any
notices or disclosures concerning Hazardous Waste which Property Manager has received from Owner. Owner shall have the right to review such notices and disclosures before their distribution or submission by Property Manager and shall have the right,
but not the obligation, to prescribe the form and content of any such notices or disclosures as long as the form and content prescribed by Owner comply with all applicable laws relating to such notices or disclosures. Owner shall provide Property
Manager with any notices or disclosures concerning Hazardous Waste associated with the Property required to be delivered by Owner under any applicable laws. 

(c)        Without limiting any other indemnification obligations
provided by law or specified in this Agreement, Property Manager shall indemnify, defend (at Property Manager’s sole cost and expense and with legal counsel approved by Owner which approval shall not be unreasonably withheld) and hold harmless
the Owner, its agents, employees and contractors from and against any and all claims, demands, losses, damage, disbursements, liabilities, obligations, fines, penalties, actions, causes of action, suits, costs and expenses, including without
limitation, reasonable attorneys’ fees and costs, and all other professionals’ or consultants’ expenses incurred in investigating, preparing for, serving as a witness in, or defending any action or proceeding, whether actually
commenced or threatened, or in removing or remediating any Hazardous Wastes on, under, from or about the Property, arising out of or relating to, directly or indirectly, Property Manager’s breach of any of the terms of this Section 5.03.
This indemnity shall survive termination of this Agreement. 
 5.04.    Asbestos and Similar Compliance
Matters.  If the Property is subject to the Occupational Safety and Health Administration’s regulations relating to asbestos, or to any state law or regulation relating to asbestos or to any state law or regulation relating to
carcinogenic or toxic chemicals, Property Manager shall, at Owner’s expense, comply with such laws and regulations as they relate to the Property. 
 ARTICLE 6.  ACCOUNTING AND FINANCIAL MATTERS. 

6.01.    Books and Records.  Property Manager shall cause to be kept for Owner at the Records Office
accounts and books and records of the Property, pursuant to methods and systems, and in form and substance, approved by Owner, showing all receipts, expenditures and all other records necessary or convenient for the recording of the results of
operations of the Property. Such books are to be maintained on both a cash and accrual accounting basis utilizing the Yardi accounting software hosted by Legacy Partners Residential, Inc. Such accounts, books and records shall be kept in a secure
location at the Records Office and shall be open to inspection by Owner and its representatives during 

  
 14 

 
normal business hours and Property Manager agrees to cooperate in making such accounts, books and records available for inspection. Upon the effective date of any termination of this
Agreement, all of such books and records shall be delivered forthwith to Owner so as to ensure the orderly continuance of the operation of the Property. Cut-off date for books on a monthly basis will be the twenty-fourth (24th) day of each month. 

6.02.    Reports and Reconciliation of Accounts. 

(a)        On or before the last day of each month, Property
Manager shall provide such reports and data to Owner as shall be required from time to time by Owner. Without limitation, Property Manager shall provide the following to Owner for the current calendar month: 

(i)        A detailed report of all monies collected (identified
by tenant or other source) which shall include, but not be limited to, rents collected (including laundry or other vending income, garage or parking income, percentage rent and other amounts payable under any retail leases, if any), rents prepaid
beyond the current month, and security deposits collected, and of vacancies and delinquent rents. 
 (ii)       A detailed report of all expenses paid. 
 (iii)      A comparison of the current month and year-to-date account of actual revenue and expenses to budgeted amounts; calculations of monthly and year-to-date variances
from the Approved Operating and Capital Budgets, appropriate descriptions of any significant monthly or year-to-date variances, and, if requested by Owner, a revised annualized projection of monies to be collected and expenses to be paid for the
balance of the calendar year. 
 (iv)      A written report
describing any material changes in the Property which occurred during the month or are anticipated to occur. 
 (v)       A reconciliation of amounts receivable or due to Owner accompanied by payment of same. 

(vi)      A reconciliation of the Property Bank Account, including a copy
of the bank statement. 
 (vii)     Any other special information as
reasonably required from time to time by Owner. 

(b)        Property Manager shall provide a monthly management
report to be submitted with the applicable monthly financial statements which shall contain without limitation, the recommendations of Property Manager regarding the physical condition or operation of the Property and leasing status reports (which
shall include security deposits and rents received). 

  
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(c)        Periodically, Property Manager shall furnish to Owner
as reasonably requested: 
 (i)         Market
surveys and any other tenant information in accordance with Section 2.02(q) above. 

(ii)        Reports covering on-site physical inspections and
operating reviews. 
 (iii)      A current inventory of personal
property and equipment used in connection with the Property. Such an inventory shall be submitted to Owner no later than thirty (30) days prior to the end of each calendar year. 

6.03.      Audit.    Owner shall have the right to conduct an audit of the
Property’s operations at any time. Property Manager shall promptly correct all weaknesses and errors disclosed by Owner’s audits, and shall timely inform Owner in writing of all corrective actions taken. Owner’s audit shall be at
Owner’s expense unless an error is discovered attributable to the services provided under this Agreement that is equal to or greater than two percent (2%) of annual gross receipts of the Property for the period audited, in which case
Property Manager shall bear the full cost of the subject audit. Any adjustments in amounts due and owing from Owner or Property Manager shall be paid within fifteen (15) calendar days following Owner’s receipt of the audit. 

6.04.      Other Reports and Statements.    Property Manager shall furnish to
Owner, as promptly as practicable, such other reports, statements or other information with respect to the operations of the Property as Owner may from time to time reasonably request. 

6.05.      Contracts and Other Agreements.    Property Manager shall maintain at
the Records Office one original (or a copy, if no original is available) of all contracts, occupancy leases, lease abstracts, tenant income certifications, equipment leases, maintenance agreements and all other agreements relating to the Property.

 6.06.      Final Accounting.    Following termination of this
Agreement, whether by expiration of the term hereof or sooner, Property Manager shall be responsible for preparing a final accounting within thirty (30) days after the effective date of said termination. Such final accounting shall set forth
all current income, all current expenses, and all other expenses contracted for on Owner’s behalf but not yet incurred in connection with the Property. The final accounting shall also include all other items reasonably requested by Owner.
Property Manager shall be entitled to receive a prorated share of its Management Fee to the date of termination and all earned but unpaid Construction Supervision Fees. 
 6.07.      Tax Returns.    Property Manager shall file all tax returns for all sales taxes, payroll taxes and other taxes directly related to the
Property; excluding, however, federal and state income tax returns of Owner. 

6.08.      Certification.    All financial statements shall be certified as true
and correct in all material respects by Property Manager. 
  

	6.09.      SOC	 1 Type II Designation.    The Property Manager, at its option, may issue a SOC 1 report

  
 16 

 
in form and substance acceptable to owner prepared by a certified public accountant on or prior to December 1st of 2013 and each subsequent year after 2013. Failure to deliver an acceptable
SOC 1 report shall not be a default under this agreement; however, if Manager fails to deliver the SOC 1 report, Manager will permit an annual internal control audit by Owner to satisfy SOX 404 requirements. The scope of the audit will be mutually
agreed upon by Owner and Manager and include a review of processes specific to the Project. The audit will be conducted at Owner’s expense but with the cooperation of Manager. 
 ARTICLE 7.  BANK ACCOUNTS. 
  

	7.01.	Property Accounts. 

 (a)        All funds received by Property Manager derived from the operation of the Property, as well as working capital furnished by Owner, shall be deposited in
an account (the “Property Bank Account”) in Property Manager’s name, as agent for Owner, in an FDIC-insured bank designated or approved by Owner, which such account will be in compliance with applicable law. The Property Bank
Account will include, if available, services to deter check fraud and other unauthorized bank transactions. Owner may direct Property Manager to change depository banks or the depository arrangements. All funds so deposited shall be deemed to be
trust funds held by Property Manager for the benefit of Owner and shall be held and disbursed as provided herein. Property Manager shall establish another custodial and/or trust account as required by applicable law or the Owner for the deposit of
tenant security deposits (the “TSD Account”). 

(b)        A Working Capital Reserve equal
to Fifty Thousand Dollars ($50,000) (the “Working Capital Reserve”) shall be funded upon execution of this Agreement and maintained in the Property Bank Account at all times throughout the term of the Agreement. A monthly cash
payment will be made by Property Manager to Owner solely from funds in the Property Bank Account in excess of the amount of the Working Capital Reserve in an amount equal to the excess, if any, of the current month projected cash receipts less the
current month’s budgeted operating and capital expenditures. This payment will be made to Owner on or before the tenth (10th) day of each month. A reconciliation of receipts and expenditures will be prepared by Property Manager in
accordance with Section 6.02 above to account for any prior period operating cash overage or shortage and any additional cash payments due to Owner will be made to Owner no later than the twenty-fifth (25th) day of the current month and any overpayments made to Owner
will be returned to Property Manager for deposit in the Property Bank Account no later than the thirtieth
(30th) day of the current month. 

(c)        No non-Property funds shall be commingled with the
funds in the Property Bank Account or TSD Account (collectively, the “Accounts”). Property Manager may not, under any circumstances, write a check payable to or in favor of, or transfer funds to, Property Manager or any Affiliate of
Property Manager from the Accounts other than to (i) reimburse itself or an Affiliate for expenditures made on behalf of Owner and approved by 

  
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Owner, or (ii) pay itself the Management Fee or other fee payable hereunder; provided that, within fifteen (15) days after payment to itself of the Management Fee or other fee, Property
Manager shall provide Owner with a statement setting forth the calculations made in computing the Management Fee or other fee in detail reasonably satisfactory to Owner. Only those persons specifically authorized by Property Manager and approved by
Owner shall have authority to write checks from the Property Bank Account. There shall be monetary limits on the checks Property Manager shall be authorized to write. Checks in excess of $25,000 (excluding debt service and those items provided for
in the Approved Operating Budget) shall require the prior written consent of Owner. 
 7.02.  Expenses Paid from
Property Bank Account.  The following costs are to be paid directly from the Property Bank Account: 
 (a)        Any and all costs necessary for the management, operation and maintenance of the Property, provided such costs are provided for and are within the limits
of the Approved Operating Budget or specifically approved in writing by Owner; the amount required to fund each budgeted payroll for the Property shall be in the Property Bank Account one (1) day prior to the date of the payment of each payroll
and if funds are not available in accordance with this schedule, the shortfall shall bear daily interest at the rate of “prime rate” published in The Wall Street Journal plus five percent (5%) per annum and be payable to Property
Manager; 
 (b)        Capital expenditures provided for
in the Approved Capital Budget or authorized in writing by Owner and directed by Owner to be incurred by Property Manager; and 
 (c)        Any and all costs necessary for emergency expenses as provided in Section 2.02(f). 

  Property Manager shall not be obligated to make any advance to or for the account of Owner or to pay any sums
except out of funds in the Property Bank Account. 
 ARTICLE 8. INSURANCE AND INDEMNITY. 

 

	8.01.  INDEMNIFICATION.	 

 (A)        PROPERTY MANAGER AGREES TO AND SHALL, COMPLETELY AND TO THE MAXIMUM EXTENT PERMITTED BY LAW, INDEMNIFY, DEFEND (WITH COUNSEL REASONABLY ACCEPTABLE TO
OWNER), PROTECT AND HOLD OWNER AND ITS RESPECTIVE PRINCIPALS, OFFICERS, DIRECTORS, SHAREHOLDERS, PARTNERS, MEMBERS, EMPLOYEES, AUTHORIZED SUCCESSORS, AUTHORIZED ASSIGNS AND AGENTS HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS, ACTIONS,
FINES, PENALTIES, LIABILITIES, LOSSES, TAXES, DAMAGES, INJURIES AND EXPENSES (INCLUDING, WITHOUT LIMITATION, 

  
 18 

 
ACTUAL ATTORNEYS’, CONSULTANTS’ AND EXPERT WITNESS’ FEES, AND DEFENSE COSTS AT BOTH THE TRIAL AND APPELLATE LEVELS) (COLLECTIVELY, “DAMAGES”) IN ANY MANNER RELATED TO,
ARISING OUT OF OR RESULTING FROM (I) ANY MATERIAL FAILURE OF PROPERTY MANAGER TO PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT CAUSING DAMAGE TO OWNER, BUT ONLY TO THE EXTENT SUCH DAMAGES ARE NOT COVERED BY THE INSURANCE MAINTAINED BY OWNER
UNDER SECTION 8.05 BELOW, (II) ANY ACTS OF PROPERTY MANAGER BEYOND THE SCOPE OF ITS AUTHORITY UNDER THIS AGREEMENT, AND (III) ANY NEGLIGENCE, WILLFUL MISCONDUCT OR OTHER WRONGFUL OR INTENTIONAL ACTS OR OMISSIONS OF PROPERTY MANAGER, BUT
WITH REGARD TO NEGLIGENCE OF PROPERTY MANAGER (AS OPPOSED TO GROSS NEGLIGENCE, WILLFUL MISCONDUCT OR OTHER WRONGFUL OR INTENTIONAL ACTS OR OMISSIONS) ONLY TO THE EXTENT SUCH DAMAGES ARE NOT COVERED BY THE INSURANCE MAINTAINED BY OWNER UNDER SECTION
8.05 BELOW. THE OBLIGATIONS OF PROPERTY MANAGER UNDER THIS SUBSECTION (A) SHALL APPLY ONLY TO THE EXTENT DAMAGES OF AN INDEMNIFIED PARTY ARE NOT COVERED BY OWNER’S COMMERCIAL GENERAL LIABILITY INSURANCE DESCRIBED BELOW IN
SECTION 8.05(B). NOTWITHSTANDING ANY OTHER PROVISIONS OF THIS AGREEMENT TO THE CONTRARY, PROPERTY MANAGER’S OBLIGATIONS UNDER THIS SECTION 8.01 SHALL SURVIVE THE EXPIRATION, TERMINATION OR CANCELLATION OF THIS AGREEMENT, AND SHALL
BIND ANY AND ALL OF THE HEIRS, SUCCESSORS, ASSIGNS, TRANSFEREES AND REPRESENTATIVES OF PROPERTY MANAGER. THE RIGHTS OF OWNER UNDER THIS SECTION 8.01 SHALL ALSO INURE TO THE BENEFIT OF ANY AND ALL OF THEIR PRINCIPALS, OFFICERS, DIRECTORS,
SHAREHOLDERS, PARTNERS, MEMBERS, EMPLOYEES, AGENTS, TRUSTEES, HEIRS, BENEFICIARIES, TRUSTS, SUCCESSORS, ASSIGNS, TRANSFEREES AND REPRESENTATIVES, AND TO THE BENEFIT OF ANY AND ALL PERSONS AND LEGAL ENTITIES WHO ARE, COULD BE OR ARE ALLEGED TO BE,
LIABLE FOR THE OBLIGATIONS OF OWNER OR SUCH PRINCIPALS, OFFICERS, DIRECTORS, SHAREHOLDERS, PARTNERS, MEMBERS, EMPLOYEES, AGENTS, TRUSTEES, HEIRS, BENEFICIARIES, TRUSTS, SUCCESSORS, ASSIGNS, TRANSFEREES AND REPRESENTATIVES. 

(B)        OWNER AGREES TO AND SHALL, COMPLETELY AND TO THE
MAXIMUM EXTENT PERMITTED BY LAW, INDEMNIFY, DEFEND (WITH COUNSEL REASONABLY ACCEPTABLE TO PROPERTY MANAGER), PROTECT AND HOLD PROPERTY MANAGER (AND ITS EMPLOYEES, AGENTS, SUCCESSORS, ASSIGNS AND TRANSFEREES) HARMLESS FROM AND AGAINST ANY AND ALL
DAMAGES IN ANY MANNER RELATED TO OR ARISING OUT OF PROPERTY MANAGER’S PERFORMANCE OF ITS OBLIGATIONS UNDER THIS AGREEMENT WHICH ARE (A) WITHIN THE 

  
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SCOPE OF ITS AUTHORITY UNDER THIS AGREEMENT, AND (B) NOT WITHIN THE SCOPE OF PROPERTY MANAGER’S INDEMNITY SET FORTH IN SECTION 8.01(A) ABOVE. NOTWITHSTANDING ANY OTHER PROVISIONS
OF THIS AGREEMENT TO THE CONTRARY, OWNER’S OBLIGATIONS UNDER THIS SECTION 8.01 SHALL SURVIVE THE EXPIRATION, TERMINATION OR CANCELLATION OF THIS AGREEMENT, AND SHALL BIND ANY AND ALL OF THE HEIRS, SUCCESSORS, ASSIGNS, TRANSFEREES AND
REPRESENTATIVES OF OWNER. THE RIGHTS OF PROPERTY MANAGER UNDER THIS SECTION 8.01 SHALL ALSO INURE TO THE BENEFIT OF ANY AND ALL OF THEIR PRINCIPALS, OFFICERS, DIRECTORS, SHAREHOLDERS, PARTNERS, MEMBERS, EMPLOYEES, AGENTS, TRUSTEES, HEIRS,
BENEFICIARIES, TRUSTS, SUCCESSORS, ASSIGNS, TRANSFEREES AND REPRESENTATIVES, AND TO THE BENEFIT OF ANY AND ALL PERSONS AND LEGAL ENTITIES WHO ARE, COULD BE OR ARE ALLEGED TO BE, LIABLE FOR THE OBLIGATIONS OF PROPERTY MANAGER OR SUCH PRINCIPALS,
OFFICERS, DIRECTORS, SHAREHOLDERS, PARTNERS, MEMBERS, EMPLOYEES, AGENTS, TRUSTEES, HEIRS, BENEFICIARIES, TRUSTS, SUCCESSORS, ASSIGNS, TRANSFEREES AND REPRESENTATIVES. 

(C)      THE RIGHTS AND OBLIGATIONS OF INDEMNITY PROVIDED IN THIS
SECTION 8.01 SHALL NOT BE EXCLUSIVE AND SHALL BE IN ADDITION TO SUCH OTHER RIGHTS AND OBLIGATIONS AS OTHERWISE EXIST INDEPENDENT OF THE PROVISIONS OF THIS SECTION 8.01. 

 

	8.02.	   Property Manager’s Insurance Responsibility. 

(a)        The Property Manager shall maintain during the term of
this Agreement, and any extensions or renewals thereof, each of the following insurance coverages with deductibles, if applicable: 
  

	 	(i)	 Workers’ Compensation Insurance at no less than statutory requirements including employer’s liability with a limit of not less than
$1,000,000 each accident for bodily injury accident and $1,000,000 each employee and policy limit for bodily injury by disease. 

  

	 	(ii)	 Non-Occupational Disability Insurance when required by law, if applicable. 

          (iii)         Commercial
General Liability Insurance with a minimum combined bodily injury and property damage per occurrence limit of liability of $5,000,000, a products-completed operations aggregate limit of $5,000,000 and a general aggregate limit of $10,000,000. Limits
of liability may be satisfied through the maintenance of a combination of primary and umbrella/excess liability policies. 

  
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          (iv)       Automobile Liability Insurance
covering owned, hired and nonowned vehicles, separate coverage in an amount not less than $1,000,000 combined single limit for bodily injury and property damage of $1,000,000 each accident. 

          (v)        Errors and Omissions
Insurance coverage in an amount not less than $1,000,000 each claim and general aggregate. 

(b)      Property Manager shall promptly provide Owner no later than
three (3) days after the Effective Date with certificates of insurance or other satisfactory documentation which evidence that all required insurance is in full force and effect. Upon request, Property Manager shall provide Owner with a copy of
the foregoing insurance policies. The insurance as required in Subsections 8.02(a)(i), (ii) and (v) to be maintained by Property Manager shall provide that the insurer shall provide to Owner thirty (30) days’ advance notice
of cancellation. The liability policies required by Subsections 8.02(a)(iii) and (iv) shall provide that the insurer shall provide to Owner thirty (30) days’ advance notice of cancellation and shall name Owner and its principals,
officers, directors, shareholders, partners, members, trustees, beneficiaries and employees as additional insureds. All liability policies shall be written to apply to all bodily injury, property damage, personal injury and other covered loss,
however occasioned, which occurred or arose (or the onset of which occurred or arose) in whole or in part during the policy period. Such liability policies also shall contain endorsements including cross-liability and waiver of subrogation, and
shall contain such other endorsements as may be reasonably required by Owner. The liability policies required by Subsections 8.02(a)(iii) shall include broad form contractual liability insurance coverage. Property Manager shall provide owner
thirty (30) days’ advance notice of a material change in the he insurance required to be maintained by Property Manager. 
 8.03.     Contract Documents; Indemnity Provisions.  Property Manager shall use reasonable commercial efforts to include in service and supply contracts prepared
or executed by Property Manager respecting the Property provisions to the effect that the other contracting party shall, to maximum extent permitted by law, indemnify, defend (with counsel reasonably acceptable to Owner), protect and hold harmless
Property Manager and Owner and their respective principals, officers, directors, shareholders, partners, members, managers, trustees, beneficiaries and employees from and against any and all Damages in any manner related to, arising out of and/or
resulting from any damage to or injury to, or death of, persons or property caused or occasioned by or in connection with or arising out of any acts or omissions of said contracting party or its employees or agents or contractors and agree that no
principal, officer, director, shareholder, partner, member, manager, investor, trustee, officer, employee or agent of Owner shall be personally liable for any of the obligations of Owner hereunder. 

8.04.     Ratings of Insurance Companies.  All insurance required to be carried by Property
Manager and Owner shall be written with companies having a policyholder and asset rate, as circulated by Best’s Insurance Reports, of A-:VIII or better unless an exception is approved by Owner or Property Manager, as appropriate. 

  
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 8.05.  Owner’s Insurance Responsibility.  Owner shall
maintain during the term of this Agreement, and any extensions thereof, each of the following insurance coverages which shall be primary and noncontributory insurance: 

(a)        All-Risk Property Damage Insurance for the full
insurable replacement cost of the Property and Loss of Rents Insurance coverage on the Property. 
 (b)        Commercial General Liability Insurance coverage with a minimum general aggregate limit of not less than $10,000,000. Property Manager shall be designated
an insured under Owner’s Commercial General Liability Insurance policy while acting within the scope of its authority as Owner’s property manager. Owner’s Commercial General Liability Insurance shall be primary and not require
contribution from Property Manager’s Commercial General Liability Insurance required in Section 8.02(a) above. All other terms and conditions of this Agreement (including, without limitation, the indemnification provisions of
Section 8.01 and Property Manager’s obligation to maintain insurance described in Section 8.02) shall not be affected by this Section 8.05(b). 
  

	8.06.	   Property Manager’s Duties in Case of Loss.  Property Manager shall: 

(a)        Immediately notify Owner of any fire or other damage
to the Property; and in the event of any serious damage to the Property or any releases of hazardous materials or contaminants, telephone Owner so that an insurance adjustor may view the Property before repairs are started, but in no event shall
Property Manager settle any losses, complete loss reports or adjust losses on behalf of Owner or meet with any federal, state or local regulatory agency without the prior written consent of Owner. 

(b)        Promptly notify Owner of any personal injury or
property damage occurring to or claimed by any tenant or third party on or with respect to the Property; and promptly forward copies to Owner of any summons, subpoena or other like legal document served upon Property Manager relating to actual or
alleged potential liability of Owner, Property Manager or the Property. 
 8.07.  Release and Waiver of
Claims.  Notwithstanding anything herein to the contrary, Owner and Property Manager each release and waive any right of recovery against the other (and against the other’s respective officers, directors, shareholders, partners,
members, employees, subsidiaries, agents, affiliates, contractors, lenders, trustees, beneficiaries, licensees, successors and assigns), for any bodily injury, property damage, or loss covered by any policy of insurance required by this Agreement,
or which would have been covered had the party carried the insurance it was required to carry by this Agreement, or within any SIR or deductible in such policy. No insurance policy required by this Agreement shall prohibit such release and waiver.
In addition, the insurance policies required of Owner and Property Manager by this Agreement shall contain a waiver of claims against the other by the insurer, whether by subrogation or otherwise (and against the other’s respective officers,
directors, shareholders, partners, members, employees, subsidiaries, agents, affiliates, contractors, lenders, trustees, beneficiaries, licensees, successors, and assigns). If any insurance policy required by this Agreement provides that a waiver of
subrogation may only be granted by endorsement, Owner or 

  
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Property Manager, as the case may be, shall secure an endorsement providing the waiver of subrogation. 
 ARTICLE 9. RELATIONSHIP OF PARTIES and REPRESENTATIONS and WARRANTIES. 

9.01.      Nature of Relationship. In taking any action pursuant to this Agreement, Property Manager
will be acting only as an independent contractor, and nothing in this Agreement, expressed or implied, shall be construed as creating a partnership or joint venture or an employment relationship or that of principal and agent between Property
Manager (or any person employed by Property Manager) and Owner or any other relationship between the parties hereto except that of property owner and independent contractor. 
 9.02.      Communications Between Parties.    Owner shall rely on Property Manager to direct and control all operations at the Property; provided,
however, Owner reserves the right to communicate directly with the manager specified in Subsection 4.01(b)(i), Property Manager’s accountant(s) working on Property matters, all tenants and tenants’ representatives, all lease
prospects, all advertising, management, cleaning and servicing firms doing work for the Property, and all parties contracting with Owner or Property Manager with respect to the Property. 

9.03.      Relationship of Owner and Property Manager with Respect to Leasing.  Property
Manager shall not be entitled to any commission or other fee in connection with the leasing of apartment units at the Property, except as specifically provided in Article 3 hereof. On-site employees of Property Manager shall be entitled to receive
incentive leasing bonuses as may be included in the Approved Operating Budget. Property Manager shall procure references from prospective tenants, investigate such references, and use its best judgment in the selection of prospective tenants. As
soon as practicable prior to any residential unit vacancy, Property Manager shall prepare rental listings and attempt to find a new tenant for such unit. Prior to entering into any leasing arrangement with any retail tenant, if any, Property Manager
shall prepare and submit to Owner for its approval a written lease proposal setting forth proposed leasing terms, including, without limitation, duration of the lease, rental rate, tax and operating expense escalations, consumer price index
adjustments, common area maintenance charges or other rental adjustments, rent and/or parking/other concessions, insurance requirements, expansion and renewal rights, tenant improvement allowance, the desired mix of tenants, and policy with respect
to guarantees, and such other matters as Owner deems appropriate. The parties intend that Property Manager shall be obligated to give available residential units and any retail space at the Property exposure at least equal to the exposure Property
Manager gives other available residential units and retail space in similar projects owned, leased, managed or operated by Property Manager or an Affiliate, and Owner shall have the right to terminate this Agreement pursuant to Section 10.02(e)
below if Property Manager fails so to do. The parties also intend that the Property Manager shall be obligated to use reasonable efforts to retain existing tenants at the Property, and Owner shall have the right to terminate this Agreement pursuant
to Section 10.02(e) below if Property Manager fails so to do. 
 9.04.      No Sales
Brokerage Agreement.  There are no sales brokerage agreements between Owner and Property Manager; Property Manager has no brokerage agreement or understanding (exclusive 

  
 23 

 
or otherwise) with respect to the sale of all or part of the Property on behalf of Owner; and in the event that Owner effects a sale of the Property, whether on its own or through the use of
others, brokers or otherwise, Property Manager shall be entitled to no compensation, fee or commission or other payment on account of such sale. Unless specifically approved by Owner, Property Manager shall have no right to obligate Owner for the
payment of any fees or commissions to any outside real estate agent or broker for tenant leases. Except as expressly provided to the contrary elsewhere herein or as otherwise approved by Owner in writing, Property Manager shall be fully responsible
for any compensation due employees of Property Manager and any real estate brokers cooperating with Property Manager. Property Manager shall indemnify and hold Owner harmless with respect to any action, proceeding, claim, liability, loss, cost or
expense (including reasonable attorneys’ fees) arising in connection with any claim for brokerage or finder’s fees or any other like payment payable as a result of a breach under this Section 9.04 by Property Manager. Property
Manager’s obligations with respect to the foregoing indemnity shall survive the expiration or earlier termination of this Agreement. 
 9.05.    Confidentiality.   Except as may be otherwise required by law, Property Manager and Owner shall maintain the confidentiality of all matters pertaining to this
Agreement and all operations and transactions relating to the Property. 
 9.06.    Property Manager Not
to Pledge Owner’s Credit. Property Manager shall not, except in the purchase of goods, wares, merchandise, materials, supplies and services reasonably required in the ordinary course of business in the operation of the Property or as may be
otherwise required in the performance of its obligations under this Agreement and in either case as previously approved by Owner, pledge the credit of Owner; nor shall Property Manager, in the name or on behalf of Owner, borrow any money or execute
any promissory note, installment purchase agreement, bill of exchange or other obligation binding on Owner or the Property. 
  

	9.07    Representations	 and Warranties. 

 (a)        Property Manager represents and warrants that (i) Property Manager has full power, authority and legal right to execute, deliver and perform this
Agreement and to perform all of its obligations hereunder and (ii) the execution, delivery and performance of all or any portion of this Agreement do not and will not (x) require any consent or approval from any governmental authority,
(y) violate any provisions of law or any government order or (z) conflict with, result in a breach of, or constitute a default under, the charter or bylaws of Property Manager or any instrument to which Property Manager is a party or by
which it or any of its property is bound. 

(b)        Owner represents and warrants that it has full power,
authority and legal right to execute, deliver and perform this Agreement. 

(c)        Property Manager acknowledges and agrees that Owner is
relying upon the representations and warranties set forth in Sections 9.07 (a) in entering into this Agreement, and Owner acknowledges and agrees that Property Manager is relying upon the representations and warranties set forth in
Section 9.07 (b) in entering into this Agreement. 

  
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 ARTICLE 10.             TERMINATION.

 10.01.  Termination by Owner Without Cause.  This Agreement may be terminated by Owner at any
time without cause and upon written notice to Property Manager by Owner, effective thirty (30) days from the date of such notice, which shall be considered the effective date of termination. 

10.02.  Termination by Owner for Cause.  This Agreement may be terminated by Owner (or the Property Manager
may be required by Owner to change its personnel assigned as Property Manager for the Property) at any time during the term hereof upon written notice to Property Manager effective immediately for any of the following causes: 

(a)        If Property Manager shall suspend or discontinue
business; 
 (b)        If a court shall enter a decree
or order for relief in respect of Property Manager in an involuntary case under the federal bankruptcy laws, as now or hereafter constituted, or any other applicable federal, state or foreign bankruptcy, insolvency or other similar law, or appoint a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of Property Manager or for any substantial part of its property, or for the winding-up, dissolution or liquidation of its affairs, and such decree or order shall
continue unstayed and in effect for a period of sixty (60) consecutive days or if Property Manager shall consent to any of the foregoing; 
 (c)        If Property Manager shall commence a voluntary case or action under the federal bankruptcy laws, as now or hereafter constituted, or any other applicable
federal or state bankruptcy insolvency or other similar law, or consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of Property Manager or for any
substantial part of its property, or make any assignment for the benefit of creditors, or admit in writing that it is unable, or fail generally to pay its debts as such debts become due, or take action in furtherance of any of the foregoing;

 (d)        If Property Manager is grossly negligent
or engages in willful misconduct with respect to its duties or obligations to Owner under this Agreement; or 
 (e)        If Property Manager commits any other material default in the performance of any of its obligations under this Agreement, unless such default is cured
with thirty (30) days after written notice of such default is given to Property Manager, or, if not curable within thirty (30) days, commenced within such thirty (30) days and diligently prosecuted to completion. 

10.03.  Termination by Property Manager.  This Agreement may be terminated by Property Manager, without cause,
upon thirty (30) days’ written notice to Owner. This Agreement may be terminated by Property Manager for cause if Owner commits any material default in the performance of any of its obligations under this Agreement, including, without
limitation, its obligation to pay to Property Manager any fees due and payable under Section 3.01 above, and such default shall continue for a period of thirty (30) days after notice thereof by Property Manager to Owner. 

  
 25 

 10.04.  Orderly Transition. In the event of any termination or expiration
of this Agreement, Property Manager shall use reasonable commercial efforts to effect an orderly transition of the management and operation of the Property to an agent designated by Owner and to cooperate with such agent, and the Accounts shall be
promptly transferred as directed by Owner. Upon termination or expiration of this Agreement, Property Manager’s right to withdraw funds from the Accounts or any other account which contains funds collected in connection with the Property shall
terminate. Property Manager shall remove all signs that it may have placed at the Property containing its name and repair any resulting damage. In addition, Property Manager shall deliver the following to Owner on or before thirty (30) days
following the termination or expiration date: 

(a)        A final accounting, reflecting the balance of income
and expenses for the Property as of the date of termination or expiration; 

(b)        Any monies due to Owner and any tenant security
deposits held by Property Manager with respect to the Property; and 

(c)        All keys, property, supplies, records, contracts,
drawings, leases and correspondence, in existence at the time of termination or expiration and all other papers or documents pertaining to the Property. All data, information and documents shall at all times be the property of Owner. 

10.05.  Rights Which Survive Termination or Expiration.    Termination and/or expiration of this
Agreement shall in no event terminate or prejudice any right arising out of or accruing in connection with the terms of this Agreement attributable to events and circumstances occurring prior to termination or expiration of this Agreement, and/or
all rights and obligations specified in this Agreement to survive such termination and/or expiration. 
 ARTICLE 11.
              MISCELLANEOUS. 

11.01.  Governing Law.   This Agreement shall be construed and enforced in accordance with the laws of the
State in which the property is located without giving effect to the conflict of law principles of such State. 

11.02.  Table of Contents and Headings.   The Table of Contents preceding this Agreement and the headings of
the various articles and sections of this Agreement have been inserted for convenient reference only and shall not have the effect of modifying or amending the express terms and provisions of this Agreement. 

11.03.  Entire Agreement.   This Agreement contains the entire agreement between the parties with regard to
the subject matter hereof, and this Agreement shall not be amended, modified or cancelled except in writing signed by both parties or by their duly authorized agents. 
 11.04.  Successors and Assigns.   All terms, conditions and agreements herein set forth shall inure to the benefit of, and be binding upon the parties, and any and all of their
respective permitted heirs, 

  
 26 

 
successors, representatives and assigns. Notwithstanding the foregoing, this Agreement may not be assigned by Property Manager nor shall Property Manager delegate any of its duties hereunder
without Owner’s prior written consent, which consent may be granted or withheld in Owner’s sole and absolute discretion. Any attempted assignment or delegation by Property Manager hereunder in violation of this Section 11.04 shall be
null and void and of no force or effect. 
 11.05.  Waiver.  The failure of either party to insist
upon a strict performance of any of the terms or provisions of this Agreement or to exercise any option, right or remedy herein contained, shall not be construed as a waiver or as a relinquishment for the future of such terms, provisions, option,
right or remedy, but the same shall continue and remain in full force and effect. No waiver by either party of any terms or provisions hereof shall be deemed to have been made unless expressed in writing and signed by such party. In the event of
consent by Owner to an assignment of this Agreement, no further assignment shall be made without the express written consent of Owner. 
 11.06.  Severability.  Whenever possible each provision of this Agreement shall be interpreted in such manner as to be effective and valid under all applicable laws. However, if
any provision of this Agreement is invalid under any applicable law, such provision shall be ineffective only to the extent of such invalidity without invalidating the remaining provisions of this Agreement and, to the fullest extent possible, this
Agreement shall be interpreted so as to give effect to the stated written intent of the parties. 
  

	11.07.	   Time.   Time is of the essence of this Agreement. 

11.08.  Attorneys’ Fees.  In the event of any legal or equitable proceeding for enforcement of any of the
terms or conditions of this Agreement, or any alleged disputes, breaches, defaults or misrepresentations in connection with any provision of this Agreement, the prevailing party in such proceeding, or the non-dismissing party where the dismissal
occurs other than by reason of a settlement, shall be entitled to recover its reasonable costs and expenses, including without limitation reasonable attorneys’ fees and costs, paid or incurred in good faith at the pre-trial, trial and appellate
levels, and in enforcing any award or judgment granted pursuant thereto. Any award, judgment or order entered in any such proceeding shall contain a specific provision providing for the recovery of attorneys’ fees and costs incurred in
enforcing such award or judgment, including without limitation (a) post-award or post-judgment motions, (b) contempt proceedings, (c) garnishment, levy, and debtor and third party examinations, (d) discovery and
(e) bankruptcy litigation. The “prevailing party”, for purposes of this Agreement, shall be deemed to be that party that obtains substantially the result sought, whether by dismissal, award or judgment. 

11.09.  Further Acts.  Owner and Property Manager shall execute such other documents and perform such other acts as
may be reasonably necessary and/or helpful to carry out the purposes of this Agreement. 
 11.10.  No
Advertising.  No publication, announcement or other public advertisement of the name of Owner in connection with the Property shall be made by Property Manager, except as may be required by applicable law or with the prior written
consent of Owner. 

  
 27 

 11.11.  Signs.   Signs and building directories are prohibited
unless specifically approved by Owner. Property Manager may place reasonable leasing signs as required with the prior approval of Owner. All signs must meet all requirements of local sign codes and ordinances. 

11.12.  Exculpatory Clause; Waivers of Jury Trial and Punitive Damages.   Property Manager and Owner
agree that no principal, officer, director, shareholder, partner, member, investor, manager, representative, trustee, officer, employee or agent of either Owner or Property Manager, or any of either party’s members or partners shall be
personally liable for any of the obligations of Owner or Property Manager hereunder and that Property Manager and Owner must look solely to the assets of either Property Manager or Owner for the enforcement of any claims against either entity
arising hereunder. 
     In addition, both Owner and Property Manager hereby waive in
connection with any claim arising out of the obligations under this Agreement any right it may have to a jury trial and any punitive or consequential damages. 
 11.13.  Notices.  Any notice required or desired to be given under this Agreement shall be given in writing and shall be deemed sufficiently given and served for all purposes
when personally delivered or delivered by any generally recognized courier, or by certified or registered mail, addressed to the appropriate address shown below. Any notice given by depositing it in the United States mail as certified or registered
mail, postage prepaid, shall be deemed given five (5) business days after deposit. 
  

			
	Owner:	  	 KBS Legacy Partners Crystal LLC
 c/o KBS Capital Advisors, LLC
 620 Newport Center Drive, Suite 1300

Newport Beach, California 92660

Attn:  David Snyder

		
	With a copy to:	  	 KBS Legacy Partners Crystal LLC
 c/o Legacy Partners Residential Realty LLC
 4000 E. Third Avenue, Sixth Floor

Foster City, California 94404

Attn:  Jeffrey K. Byrd

		
	With a copy to:	  	 KBS Legacy Partners Crystal LLC
 c/o Legacy Partners Residential Realty LLC
 4000 E. Third Avenue, Sixth Floor

Foster City, California 94404

Attn:  W. Dean Henry/Guy K. Hays

  
 28 

			
	 Property Manager:
	  	 Bozzuto Management Company

7850 Walker Drive, Suite 400
 Greenbelt, Maryland
20770
 Attn: Julie A. Smith, President

		
	  
 With a copy
to:
	  	 Gallagher Evelius & Jones LLP
 218 North Charles Street, Suite 400
 Baltimore, Maryland 21201

Attn:  Saul E. Gilstein, Esquire

 11.14.    Counterparts.  This Agreement may be executed in any
number of counterparts and each such counterpart shall be deemed to be an original instrument, but all such executed counterparts together shall constitute one and the same instrument. 

11.15    Accessibility Provisions.  Property Manager will not provide design or construction advice
or consultation in any new construction or renovation of the Property with respect to compliance with accessibility requirements under the Fair Housing Act or the Americans with Disabilities Act (collectively, “FHA/ADA Requirements”).

     Notwithstanding anything in this Agreement to the contrary, Owner shall indemnify,
defend and hold harmless Property Manager and its stockholders, directors, officers, employees and agents from and against any and all claims, actions, suits, proceedings, losses, costs and expenses, including reasonable attorneys’ fees and
disbursements, relating to Owner’s failure to comply with the FHA/ADA Requirements or the ADA provisions for removal of barriers to accessibility for the disabled or any other comparable federal, state or local laws, and for Owner’s
refusal, after notice from Property Manager, to approve and implement changes in the physical improvements, lease documents, or policies and procedures necessary for compliance with all such non-discrimination laws. 

 
 [remainder of page intentionally left blank] 

  
 29 

 IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed as of the Effective Date. 
  

											
	 OWNER:
	  	 KBS LEGACY PARTNERS CRYSTAL LLC, a
 Delaware limited liability company

			
		  	By:      	  	 KBS LEGACY PARTNERS PROPERTIES LLC,
 a Delaware limited liability company, its sole member

				
		  		  	By:      	 	 KBS LEGACY PARTNERS LIMITED PARTNERSHIP,
 a Delaware limited partnership, its sole member

					
		  		  		 	By:    	 	KBS LEGACY PARTNERS APARTMENT REIT, INC., a Maryland corporation, its sole general partner
					
		  		  		 		 	By: /s/ W. Dean
Henry                                        
                  
		  		  		 		 	Name: W. Dean Henry
		  		  		 		 	Title: Chief Executive Officer

  

							
	 PROPERTY MANAGER:
	  	BOZZUTO MANAGEMENT COMPANY,
		  	a Maryland corporation	  	
				
		  	By:	 	 /s/ Richard L. Mostyn
	  	

							
		  	 Name:	  	Richard L. Mostyn        	  	
		  	 Its:	  	Chief Financial Officer	  	

  
 30 

 EXHIBIT A 
 LEGAL DESCRIPTION OF PROPERTY 
 All that certain property located in Frederick County, Maryland
more particularly described as follows: 
 Section 3-R, containing 16.345 acres of land, more or less, as set forth on plat entitled
“Consolidated Plat, Section 3-R, Waterford”, as recorded in Plat Book 45 at Plat 105, among the Land Records of Frederick County, Maryland. 
 TAX I.D. No. 02-155591 

  
 A-1

 EXHIBIT B 
 RENTAL GUIDELINES 
 Property Manager may enter into new leases for space at the Property and renew
or extend existing leases without Owner’s prior written consent provided that each such lease: 
  

	1)	for residential apartment units: 

  

	 	a)	is documented using, and does not materially deviate from, the standard lease form attached as Exhibit C to this Agreement, other than changes required by law or any
governmental agency; and 

  

	 	b)	shall be for initial terms of at least six (6) months and not more than twelve (12) months, unless a longer lease is included in the Annual Business Plan.

  

	2)	provides for rental rates and terms no less than the suggested daily rates provided by YieldStar unless otherwise approved by Owner. 

 

	3)	is not for a corporate apartment unit except that the Property Manager may enter into an arms-length lease for corporate apartment units of up to ten percent
(10%) of the total number of apartment units, unless the Annual Business Plan provides for more than ten percent (10%) of the total number of apartment units to be available as corporate apartment units; provided, however, unless otherwise
approved by Owner Property Manager will not allow more than 10 corporate leases to expire in any given month. 

  

	4)	is an arms-length transaction with a tenant that is not an Affiliate of Owner or Property Manager (with the exception of apartment units which may be leased to
employees of an Affiliate of the Owner or Property Manager as designated in, and at rental rates no less than those set forth in, the Annual Business Plan). 

 

	5)	Equal Housing Opportunity: Property Manager will do business in accordance with the Federal Fair Housing Law. 

 

	6)	Resident Income: Except as approved by Owner in writing, prospective residents will have monthly income which will at a minimum be three times the monthly rent.

  

	7)	Credit: All prospective residents must have satisfactory credit as determined in the best judgment of Property Manager. As evidence of prospective residents’
satisfactory credit history, Property Manager shall procure a background check and credit report for prospective tenants from a national reporting agency. 

 

	8)	Employment: Property Manager shall confirm employment and salary for prospective tenants for at least the prior three years by, among other satisfactory methods,
contacting prior employers of prospective tenants. 

  

	9)	Previous Residence: If appropriate, Property Manager shall confirm satisfactory residency for prospective tenants, including without limitation, contacting previous
landlords of prospective tenants. 

  

	10)	Rental Guideline Changes: Any material changes in the above guidelines shall be submitted to the Owner for review and approval 

  
 B-1

 EXHIBIT C 
 STANDARD RESIDENTIAL LEASE FORM 

  
 D-2

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