PURCHASE AND SALE AGREEMENT by and between ASHFORD PROPERTIES, LLC, Series D-Gurnee Partners at Carriage House, an Illinois limited liability company (Seller) and STEADFAST ASSET HOLDINGS, INC., a California corporation (Buyer) TABLE OF CONTENTS Page No. 1.PURCHASE AND SALE1 1.1 Property1 1.2 No Warranty3 2.PURCHASE PRICE4 3.PAYMENT OF PURCHASE PRICE4 3.1 Deposit4 3.2 Remainder of Purchase Price4 3.3 Buyer Default; Liquidated Damages4 3.4 Sellers Default; Specific Performance5 4.ESCROW INSTRUCTIONS5 4.1 Opening of Escrow5 4.2 Conditions to Close5 4.3 Recordation and Transfer6 5.CLOSING6 5.1 Generally6 5.2 Extension Option7 6.BUYERS REVIEW7 6.1 Delivery of Documents7 6.2 Access8 6.3 Title and Survey8 6.4 Buyers Due Diligence; Indemnity9 6.5 Buyers Termination Right10 6.6 Contracts10 7.REPRESENTATIONS AND WARRANTIES11 7.1 Sellers Representations and Warranties11 7.2 Buyers Representations and Warranties14 8.COVENANTS15 8.1 Sellers15 8.2 Buyer17 8.3 Broker Indemnity18

This PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (“Agreement”) is made and entered into as of the 6th day of April, 2016 (the “Effective Date”), by and between ASHFORD PROPERTIES, LLC, Series D-Gurnee Partners at Carriage House, an Illinois Limited Liability Company (“Seller”), and STEADFAST ASSET HOLDINGS, INC., a California corporation (“Buyer”), with reference to the following facts:

A.Seller is the fee owner of that certain land with a multi-family residential project commonly known as CARRIAGE HOUSE APARTMENTS, consisting of 136 units, located at 4344 McClure Avenue, Gurnee, IL 60031 and more particularly described in Exhibit “A” attached hereto, together with all structures, improvements, machinery, fixtures and equipment affixed or attached to such land (collectively referred to herein as the “Real Property”).

B.Seller desires to sell the Real Property, along with certain related personal and intangible property, to Buyer, and Buyer desires to purchase such Real Property and related personal and intangible property from Seller in accordance with the terms and conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth, the parties hereto mutually agree as follows:

1.1    Property. Subject to the terms and conditions of this Agreement, and for the consideration herein set forth, Seller agrees to sell and transfer, and Buyer agrees to purchase and acquire, all of Seller’s right, title, and interest in and to the following, whether now existing or hereafter acquired or created (collectively, the “Property”):

1.1.1    The Real Property;

1.1.2    All easements, licenses, interests, rights, privileges, tenements, hereditaments and appurtenances on or in any way appertaining to the Real Property, including, without limitation, all water and water rights;

1.1.3    Except for the equipment, tools, machinery, materials, furniture, furnishings, supplies and tangible property that is identified on Exhibit “B-2” attached hereto and that is not being sold or transferred to Buyer but retained by Seller, all equipment, tools, machinery, materials, furniture, furnishings, supplies and other tangible personal property owned by Seller and located on or used in connection with or arising out of the ownership, management or operation of the Real Property (collectively, “Personal Property”); the Personal Property owned by Seller as of the Effective Date is identified on Exhibit “B-1” attached hereto. Seller represents and warrants that all Personal Property is owned by Seller and no other entity, including any management company or any other entity of Seller. Further, no vehicle required to be titled are being transferred to Buyer pursuant to this Agreement.

1.1.4    All leases and occupancy agreements relating to the Property, including all amendments thereto (collectively, “Leases”); the Leases in effect on the Effective Date are identified on the rent roll attached hereto as Schedule 1;

1.1.5    Subject to Section 6.6 below, all service, maintenance, supply or other contracts relating to the leasing, advertising, management, operation, maintenance or repair of the Property (including without limitation all warranties and guarantees thereunder) other than the property management agreement (collectively, “Contracts”); the Contracts in effect as of the Effective Date are identified on Schedule 2 attached hereto;

1.1.6    All licenses, permits, certificates of occupancy and governmental approvals relating to the Property, including without limitation those identified on Schedule 3 attached hereto (collectively, “Approvals”) and any plans, specifications, studies, reports or surveys relating to the Real Property and transferable construction warranties; and

1.1.7    All entitlements and intangible personal property in connection with or arising out of the design, construction, ownership, occupancy, use, management, operation, maintenance, repair or ownership of the Real Property, including, without limitation, trade names (including “Carriage House Apartments” or derivatives thereof), websites, web domains and internet addresses, all phone number(s) for the Real Property, all fax number(s) for the Real Property and logos (collectively, the “Intangible Property”). Seller states, to the best of its knowledge and belief, that the property currently does not have a separate website or active web domain.

Included in the Property shall be any and all the foregoing items in which any affiliate of Seller has any right, title or interest, to the extent the same is used solely in connection with the Real Property unless otherwise expressly agreed to by Buyer; it being understood and agreed that Seller shall cause such affiliate to convey the same to Buyer at Closing.

Excluded from the Property shall be the following items: all cash, cash equivalents (including certificates of deposit) on hand or in any bank account, including but not limited to the lock box, operating account, deposit account, amounts in the security deposit account that may be in excess of security deposits held pursuant to the tenant leases (it being understood and agreed however that Buyer shall receive a credit at Closing for 100% of all refundable tenant security deposits), and Fannie Mae escrow account, or other account maintained in connection with the ownership, management or operation of the Property including any non-refundable security deposits (but without limiting the credits to Buyer under Section 9.1 or Section 9.2 for all refundable security deposits, prepaid rents or other matters), deposits held by third parties (e.g., utility companies), accounts receivable and any right to a refund or other payment relating to a period prior to the Closing, including any real estate tax refund (subject to the pro-rations hereinafter set forth), bank accounts, claims or other rights of Seller against any present or prior partner, member, employee, agent, manager, officer or director of Seller or its direct or indirect partners, members, shareholders or affiliates, any refund in connection with termination of Seller’s existing insurance policies, any insurance claims or proceeds arising out of or relating to events that occur prior to the Closing Date subject to the terms of Section 12 of this Agreement, all contracts between Seller and any law firm, accounting firm, property manager, or broker, and any Excluded Documents (as hereinafter defined).

1.2    No Warranty“AS IS WHERE IS” Subject to the representations, warranties, covenants and agreements of Seller set forth in this Agreement, Seller is selling and Buyer is purchasing the Property “AS IS WHERE IS” with all faults. Unless specifically stated otherwise in this Agreement, any and all representations, warranties, covenants and agreements of Seller shall be merged in the deed and shall not survive the Closing. The Purchase Price (as hereinafter defined) and the terms and conditions set forth in this Agreement are the result of arm’s-length bargaining between entities familiar with transactions of this kind, and said price, terms and conditions reflect the fact that Buyer shall have the benefit of, but, except for the representations, warranties, covenants and agreements of Seller specifically set forth in this Agreement or any document delivered by Seller at Closing pursuant to Section 10 of this Agreement, is not relying upon, any information provided by Seller or statements, representations or warranties, express or implied, made by Seller, including, without limitation, any relating to the value of the Property, the physical or environmental condition of the Property, any state, federal, county or local law, ordinance, order or permit, or the suitability, compliance or lack of compliance of the Property with any regulation, or any other attribute or matter of or relating to the Property. Upon Closing, Buyer hereby fully releases Seller from, and irrevocably waives its right to maintain, any and all claims and causes of action that it may then have or thereafter acquire against Seller with respect to any and all losses, damages, costs and expenses arising from or related to any defects, errors, omissions in the Seller Deliveries or other conditions affecting the Property except as otherwise provided in this Agreement or any document delivered by Seller at Closing pursuant to Section 10 of this Agreement. Buyer acknowledges that, provided Seller complies with its obligations under this Agreement, Buyer will have sufficient opportunity prior to Closing to review and conduct such independent analyses, studies, reports, investigations and inspections as it deems appropriate in connection with the Property. If Seller provides or has provided any documents, summaries, opinions or work product of consultants, surveyors, architects, engineers, title companies, governmental authorities or any other person or entity with respect to the Property, Buyer and Seller agree that (i) Seller has done so or shall do so only for the convenience of both parties or as required under this Agreement, (ii) except to the extent of representations or warranties specifically set forth in this Agreement or any document delivered by Seller at Closing, pursuant to Section 10 of this Agreement, Buyer shall not rely thereon, and (iii) the reliance by Buyer upon any such documents, summaries, opinions or work product shall not create or give rise to any liability of or against Seller except as otherwise expressly provided in this Agreement or any document delivered by Seller at Closing, pursuant to Section 10 of this Agreement. Buyer acknowledges and agrees that, except as specifically set forth in this Agreement or any document delivered by Seller at Closing, pursuant to Section 10 of this Agreement, no representation has been made and no responsibility is assumed by Seller with respect to the financial earning capacity or expense history of the Property, the continuation of contracts, continued occupancy levels of the Property, or any part thereof, or the continued occupancy by tenants of any Leases or, without limiting any of the foregoing, occupancy, or any other matters arising or related to the Property at Closing.

The total purchase price (“Purchase Price”) to be paid by Buyer to Seller for the Property shall be SEVEN MILLION SIX HUNDRED THOUSAND AND 00/100 DOLLARS ($7,600,000.00), payable all in cash.

3.    PAYMENT OF PURCHASE PRICE.

The Purchase Price shall be paid as follows:

3.1    Deposit. As part of the Opening of Escrow (as defined below), Buyer shall deliver to Chicago Title Company (“Escrow Holder”), which has an address of 2441 Warrenville Road, Lisle, Illinois 60532, Lisle, Illinois, Attn: Julie Ebbert, the sum of ONE HUNDRED THOUSAND AND 00/100 DOLLARS ($100,000.00) (“Initial Deposit”) in immediately available funds as a good faith deposit. The Initial Deposit, the Extension Deposit (as hereinafter defined, if and when made) and all interest earned on any of the foregoing, shall be collectively referred to in this Agreement as the “Deposit.” At Buyer’s discretion, and pursuant to the policy of Escrow Holder, Escrow Holder shall place the Deposit in one or more government insured interest-bearing accounts satisfactory to Seller and Buyer (which shall have no penalty for early withdrawal), and shall not commingle the Deposit with any funds of Escrow Holder or any other person or entity. The Deposit shall be governed by the terms of the Joint Order Escrow attached hereto as Exhibit “I”, and, if Closing occurs, shall be applied against the Purchase Price. The term “Business Day” as used in this Agreement shall mean Monday through Friday, excluding Federal Holidays.

3.2    Remainder of Purchase Price. On or before the Closing Date, Buyer shall deposit into Escrow immediately available funds in an amount which, when added to the Deposit, will equal the Purchase Price plus any additional amounts necessary to cover costs and/or pro-rations under this Agreement.

3.3    Buyer Default; Liquidated Damages. SELLER AND BUYER AGREE THAT, IF THE PURCHASE AND SALE OF THE PROPERTY IS NOT COMPLETED AND THIS AGREEMENT TERMINATES BECAUSE BUYER MATERIALLY DEFAULTS UNDER THIS AGREEMENT OR MATERIALLY BREACHES THIS AGREEMENT (AFTER WRITTEN NOTICE AND SEVEN (7) BUSINESS DAYS TO CURE, EXCEPT WITH RESPECT TO BUYER’S OBLIGATION TO DELIVER THE PURCHASE PRICE AND ANY DOCUMENT(S) REQUIRED UNDER SECTION 10.2 TO ESCROW HOLDER ON OR PRIOR TO THE SCHEDULED CLOSING DATE, FOR WHICH NO NOTICE OR CURE SHALL BE AVAILABLE), THE PORTION OF THE DEPOSIT THEN DEPOSITED WITH ESCROW HOLDER PURSUANT TO THIS AGREEMENT SHALL BE PAID TO SELLER UPON TERMINATION OF THIS AGREEMENT AND RETAINED BY SELLER AS LIQUIDATED DAMAGES AND AS SELLER’S SOLE REMEDY AT LAW OR IN EQUITY. SELLER AND BUYER AGREE THAT, UNDER THE CIRCUMSTANCES EXISTING AS OF THE DATE OF THIS AGREEMENT, ACTUAL DAMAGES MAY BE DIFFICULT TO ASCERTAIN AND THE PORTION OF THE DEPOSIT THEN DEPOSITED WITH ESCROW HOLDER PURSUANT TO THIS AGREEMENT IS A REASONABLE ESTIMATE OF THE DAMAGES THAT WILL BE INCURRED

3.4    Seller Default; Specific Performance. If Seller fails to consummate the sale of the Property pursuant to this Agreement or otherwise materially defaults on its obligations hereunder at or prior to Closing, or if prior to Closing any one or more of Seller’s representations or warranties are breached in any material respect, and such default or breach is not cured by the earlier of the seventh (7th) Business Day after written notice thereof from Buyer or the Closing Date (except no notice or cure period shall apply to Seller’s obligation to deliver the documents required under Section 10.1 to Escrow Holder on or prior to the scheduled Closing Date or otherwise fails to consummate the sale of the Property hereunder), Buyer may (a) terminate this Agreement by giving Seller timely written notice of such termination prior to or at Closing and recover the Deposit and the first $50,000.00 of Buyer’s Costs (as hereinafter defined) incurred as of the date of such termination PLUS, if Buyer first learns of such default after has paid any non-refundable rate lock, spread lock or similar fee to its proposed lender (which Buyer hereby agrees it shall not do earlier than five (5) Business Days prior to the proposed Closing Date), the amount of such non-refundable fee, (b) enforce specific performance to consummate the sale of the Property hereunder, or (c) waive said failure or breach and proceed to Closing without any reduction in the Purchase Price. Notwithstanding anything herein to the contrary, Buyer shall be deemed to have elected to terminate this Agreement if Buyer fails file a lawsuit asserting a claim or cause of action for specific performance against Seller in the county in which the Property is located within thirty (30) days following the Outside Closing Date. Buyer’s remedies shall be limited to those described in this Section 3.4 and Section 13. For purposes of this Agreement, “Buyer’s Costs” shall mean the actual expenses incurred by Buyer and paid (A) to Buyer’s attorneys (including in-house attorneys) in connection with the negotiation of this Agreement or the proposed purchase of the Property, (B) to third party consultants in connection with the performance of examinations, inspections and/or investigations pursuant to Section 6 and (C) to any potential lender in connection with any proposed financing of the Property.

4.    ESCROW INSTRUCTIONS.

4.1    Opening of Escrow. Within three (3) Business Days after the mutual execution and delivery of this Agreement, the parties shall open an escrow (“Escrow”) with Escrow Holder in order to consummate the purchase and sale in accordance with the terms and provisions hereof by (i) Buyer delivering to Escrow Holder the Initial Deposit and (ii) Buyer and Seller delivering to Escrow Holder their respective executed counterparts of this Agreement and the Joint Order Escrow (collectively, the “Opening of Escrow”). Escrow Holder shall deliver written confirmation of the date of the Opening of Escrow as well as its countersignature to the Joint Order Escrow to the parties in the manner set forth in Section 17 of this Agreement as well as by e-mail to counsel for the parties.

4.2    Conditions to Close. Escrow shall not close unless and until the following conditions precedent and contingencies have been satisfied or waived in writing by the party for whose benefit the conditions have been included:

4.2.1.    All funds and instruments described in Sections 3 and 10 have been delivered to Escrow Holder, and Seller and Buyer have approved, executed and delivered a settlement statement reflecting the Purchase Price, all pro-rations, and all closing costs as required under this Agreement (the “Settlement Statement”).

4.2.2.    Seller shall have caused the title department of Escrow Holder to have irrevocably committed to Buyer in writing to issue an ALTA 2006 extended owner’s policy of title insurance, in form and content reasonably acceptable to Buyer (and in conformance with the required state of title as provided in Section 6.3 below) insuring Buyer’s fee simple title to the Real Property in an amount equal to the Purchase Price subject only to the Permitted Exceptions (as hereinafter defined) and subject to no conditions other than payment of the applicable premium therefor.

4.2.3    Seller and Buyer shall each have materially performed, observed and complied with all covenants, agreements and conditions required by this Agreement to be performed, observed and/or complied with by such party prior to, or as of, the Closing.

4.2.4    Seller’s and Buyer’s representations and warranties, as stated in Section 7 of this Agreement, shall be true and correct in all material respects as of the Effective Date and as of the Closing Date, except for representations and warranties made as of, or limited by, a specific date, which will be true and correct in all material respects as of the specified date or as limited by the specified date.

4.2.5    There shall exist no pending or threatened actions, suits, arbitrations, claims, attachments, proceedings, assignments for the benefit of creditors, insolvency, bankruptcy, reorganization or other proceedings, against the other party that would materially and adversely affect that party’s ability to perform its obligations under this Agreement.

4.3.2    Deliver to the parties entitled thereto the other Closing Documents (as hereinafter defined); and

4.3.3    Disburse all funds deposited with Escrow Holder by Buyer in payment of the Purchase Price for the Property (subject to applicable pro-rations and adjustments as provided herein) to (i) Seller by wire transfer pursuant to instructions to be delivered by Seller to Escrow Holder, (ii) for closing costs, to the party entitled thereto, and (iii) any remainder to Buyer, all as set forth in the Settlement Statement.

5CLOSING.

5.1    Generally. Escrow shall close upon the recordation of the Deed (or if the parties have agreed to close on the basis of gap coverage from the Escrow Holder, then at such

time as the Escrow Holder is otherwise prepared to record the Deed and all the conditions associated with the recording of the Deed have been satisfied) in accordance with the provisions of this Agreement (“Date of Closing”, “Closing Date”, “Closing” or “Close of Escrow”). The Close of Escrow shall occur on a date selected by Buyer, but in no event later than the date that is sixty (60) days after the Opening of Escrow (“Outside Closing Date”) via escrow delivery of documents and funds to the office of Escrow Holder (or such other location as may be mutually agreed upon by Seller and Buyer), unless otherwise extended (i) by operation of Section 6.3 or Section 12 below (ii) by Buyer pursuant to Section 5.2 below, or (iii) by written agreement between Buyer and Seller.

5.2    Extension Option Notwithstanding Section 5.1 above, Buyer shall have the option (“Extension Option”) to extend the Outside Closing Date for an additional twenty (20) days (“Extended Outside Closing Date”), in Buyer’s sole and absolute discretion, by providing written notice to Seller of such election prior to the Outside Closing Date. In such case, Buyer shall deposit with Escrow Holder an additional sum of ONE HUNDRED THOUSAND and 00/100 DOLLARS ($100,000.00) (“Extension Deposit”) in immediately available funds on or before the original Outside Closing Date. The Extension Deposit shall automatically become part of the Deposit for all purposes under this Agreement.

6.    BUYER’S REVIEW.

6.1    Delivery of Documents. Within seven (7) days after the Opening of Escrow, Seller shall, at the sole expense of Seller, deliver to Buyer (in electronic format to the extent feasible, otherwise by making available at the Property) all documents pertaining to the Property that are in the possession or control of, or are reasonably available to, Seller, including, without limitation, the documents listed on Exhibit “C” attached hereto (collectively, the “Seller Deliveries”) other than the Excluded Documents (as hereinafter defined) and without any obligation on the part of Seller to pay any third party to prepare or deliver any such documents that are not in Seller’s or its property manager’s possession. Seller hereby acknowledges and agrees that the following are in the possession of or control of, or are reasonably available to, Seller and will be provided to Buyer: monthly operating statements (year-to-date and 2-year historical); year-end financial statements, audited if available (past 2 years); general ledger (year-to-date and 2-year historical); and copies of all Leases. Notwithstanding the foregoing, the Leases will not be delivered to Buyer, but may be reviewed and copied by Buyer at the property management office located at the Property, provided that upon Buyer’s request, Seller shall deliver to Buyer a sample set of no less than twenty percent (20%) of the Leases. Except as specifically set forth in this Agreement pursuant to Section 7 or any document executed by Seller at Closing, Seller makes no representations or warranties, express, written, oral, statutory or implied with respect to the Seller Deliveries or the Property, and all such representations and warranties are hereby expressly disclaimed. All Seller Deliveries or other information provided by Seller to Buyer are for informational purposes only, and Buyer shall not in any way be entitled to rely upon the completeness or accuracy of such materials and information, except as specifically set forth in this Agreement pursuant to Section 7, or any document executed by Seller at Closing, and will instead rely on its own inspections with respect to all matters it deems relevant to its decision to acquire, own and operate the Property. Notwithstanding anything to the contrary set forth herein, Buyer acknowledges and agrees that it shall have no right to review or inspect any of the following (the “Excluded Documents”): (a) reports prepared by or for Seller

or any of its affiliates in connection with the proposed sale of the Property, (b) communications between Seller or any of its affiliates and their attorneys, (c) appraisals, financial assessments or other financial evaluations of the Property prepared by or for Seller or any of its affiliates and (d) other correspondence, memoranda and documents prepared or intended solely for internal use of Seller and/or its affiliates.

6.2    Access. Commencing upon the execution of this Agreement by Buyer and Seller, Seller shall permit (or cause to be permitted ) Buyer or Buyer’s agents, employees, contractors, lenders and representatives access to the Property for purposes of any non-intrusive physical or environmental test, study or inspection of the Property and, to the extent copies are not provided to Buyer by Seller pursuant to Section 6.1, review and copying of Seller’s books and records relating to the Property (other than Excluded Documents) and any of the documents described in Section 6.1 above, and other matters necessary in the discretion of Buyer to evaluate and analyze the feasibility of the Property for Buyer’s intended use thereof. Buyer shall not conduct or authorize any physically intrusive testing of, on, or under the Property without first obtaining Seller’s consent (which may be via electronic mail, but without requirement for concurrent overnight delivery) as to the timing and scope of work to be performed, which consent shall not be unreasonably withheld, conditioned or delayed. Seller hereby acknowledges and agrees that Buyer or Buyer’s representatives may communicate with any governmental authority or quasi-governmental authority for the purpose of gathering information in connection with the Property or the Seller, or the transaction contemplated by this Agreement. Prior to any entry Buyer shall notify (which may be via electronic mail, but without requirement for concurrent overnight delivery) Seller and Seller shall have the right to have a representative of Seller present during any entry onto the Property by Buyer. Buyer shall not contact any tenant of the Property without the prior written approval of Seller. In the event that Seller does consent to Buyer’s contact with any tenant of the Property, Seller shall have the right to have a representative of Seller present during any such interview. Prior to any entry onto the Property for purposes of inspection or testing (as opposed to solely for review of materials), Buyer shall provide Seller with evidence that Buyer maintains liability insurance with coverage in an amount not less than $1,000,000.00 combined single limit, for personal injury, including bodily injury and death, and property damage. Such insurance shall name Seller and Seller’s property manager (if requested in writing by Seller) as additional insured parties and shall be with companies authorized to issue insurance in the state in which the Real Property is located.

6.3    Title and Survey.

6.3.1    Upon Opening of Escrow, Seller shall place an order with Escrow Holder that shall cause Escrow Holder to issue to Buyer within ten (10) days after the date of such order a current commitment for an owner’s policy of title insurance in the amount of the Purchase Price on an ALTA 2006 form together with copies of all documents of record referenced therein (collectively, the “Title Commitment”) at Seller’s sole cost and expense (as provided in Section 11 below). Buyer shall have twenty-five (25) days following its receipt of the Title Commitment and any survey provided to Buyer pursuant to Section 6.3.2 below (“Title Objection Period”) in which to notify Seller in writing of any objections Buyer has, in Buyer’s sole and absolute discretion, to any matters shown on the Title Commitment (“Title Objection Notice”). All objections raised by Buyer in the manner herein provided are hereafter called “Objections.” Subject to the

requirements set forth in the penultimate sentence of this Section 6.3.1, Seller shall notify Buyer in writing as to which Objections, if any, Seller irrevocably agrees to remedy or remove at or prior to Closing within five (5) Business Days following Buyer’s delivery of the Title Objection Notice (“Seller’s Notice Period”). In the event Seller fails to provide such notice or indicates in such notice that Seller is unwilling to irrevocably agree to remedy or cause the removal of any Objections at or prior to Closing within Seller’s Notice Period, then Buyer, within five (5) Business Days after the expiration of Seller’s Notice Period (“Buyer’s Termination Period”), shall deliver to Seller written notice electing, in Buyer’s sole and absolute discretion, to either (i) terminate this Agreement, or (ii) unconditionally waive any such Objections, failing which Buyer shall conclusively be deemed to have elected (ii) above. Any new title or survey information received by Seller or Buyer after the expiration of the Title Objection Period, Seller’s Notice Period or Buyer’s Termination Period, as applicable, from a supplemental title report, survey or other source which is not the result of the acts or omissions of Buyer or its agents, contractors or invitees (each, a “New Title Matter”) shall be subject to the same procedure provided in this Section 6.3 (and the Date of Closing shall be extended commensurately if the Closing would have occurred but for those procedures being implemented for a New Title Matter), except that Buyer’s Title Objection Period, Seller’s Notice Period and Buyer’s Termination Period for any New Title Matters shall be five (5) Business Days each. Close of Escrow shall be delayed as needed to accommodate such additional time periods. Notwithstanding anything to the contrary contained herein, Seller shall have no obligation to cure title Objections except (i) financing liens of an ascertainable amount created by, under or through Seller, which liens Seller shall cause to be released at or prior to Closing (with Seller having the right to apply the Purchase Price or a portion thereof for such purpose), and Seller shall deliver the Property free and clear of any such financing liens, (ii) any exceptions or encumbrances to title which are created by, under or through Seller after the Effective Date without Buyer’s consent, and (iii) any Objections which Seller has specifically agreed, in writing, to cure. The term “Permitted Exceptions” shall mean: the specific exceptions in the Title Commitment approved by Buyer; other exceptions to which Buyer has not raised an Objection as provided herein or has subsequently waived such Objection in writing and that Seller is not required to remove as provided above; real estate taxes not yet due and payable; rights of tenants (as tenants only) under the Leases; and any matters approved by Buyer or arising by, through or under Buyer or its or Buyer’s contractors, employees, representatives, proposed lenders, or agents.

6.3.2    Within five (5) days after the Opening of Escrow, Seller shall provide Buyer with a copy of any existing survey of the Property in Seller’s possession or control. Buyer, at its sole cost and expense, may elect to obtain a new survey or revise, modify, or re-certify an existing survey of the Property (either, the “Survey”) as necessary in order for the title department of Escrow Holder to delete the general survey exception from title or to otherwise satisfy Buyer’s objectives.

6.4    Buyer’s Due Diligence; Indemnity. Buyer shall have thirty (30) Business Days from and after the Opening of Escrow (“Due Diligence Period”) to evaluate and analyze the feasibility of the Property for Buyer’s intended use thereof, including, without limitation, the zoning of the Property, the physical, environmental and geotechnical condition of the Property and the economic feasibility of owning and operating the Property. If, during the Due Diligence Period, Buyer determines in Buyer’s sole and absolute discretion that the Property is not acceptable for any

reason whatsoever, Buyer shall have the right, by giving written notice to Seller on or before the last day of the Due Diligence Period, to terminate this Agreement. Except to the extent arising out of the negligence or willful misconduct of Seller or Seller’s contractors, employees, representatives or agents, Buyer agrees to indemnify and hold Seller harmless and defend Seller from and against any claims, liabilities, liens, cause of action, expenses, costs, or damages (including reasonable attorneys’ fees and personal injury claims but expressly excluding punitive, special, consequential or incidental damages) resulting from the inspection of the Property prior to the Closing Date by Buyer or Buyer’s contractors, employees, representatives, or agents; provided, however, that Buyer shall not be responsible for any losses or expenses resulting from the discovery of adverse information regarding the Property. In the event this Agreement is terminated for any reason, Buyer shall promptly restore the Property to the extent of any physical change or damage made as a result of the conduct of any inspection or investigation of the Property by Buyer or Buyer’s agents, representatives or contractors to substantially the same condition that existed immediately prior to Buyer’s inspection and investigation, to the extent permitted by applicable law. Any provision to the contrary herein notwithstanding, the provisions of the previous two sentences shall survive termination of this Agreement for any reason for a period of four (4) months (as it pertains to any property damage to Seller’s property caused by Buyer or any other claim by Seller) or one (1) year (as it pertains to any property damage to any tenant’s property or any personal injury or other claim by a third party) and control over any provisions to the contrary herein; provided however that if Seller shall have provided written notice to Buyer with reasonable detail of a specified repair or payment Buyer is required to make hereunder, then such period shall be extended until such repair is complete or payment is made.

6.5    Buyer’s Termination Right. If Buyer exercises the right to terminate this Agreement in accordance with Sections 6.3 (including without limitation for any New Title Matter) or 6.4 hereof, this Agreement shall terminate as of the date the termination notice is given by Buyer (except as to such matters that are expressly specified to survive the termination of this Agreement), and Escrow Holder shall return the Deposit to Buyer If Buyer does not exercise the right to terminate this Agreement in accordance with Sections 6.3 or Section 6.4 hereof, this Agreement shall continue in full force and effect and the Deposit shall become non-refundable except as provided in Section 3.1 above.

6.6    Contracts. On or before the expiration of the Due Diligence Period, Buyer shall notify Seller in writing as to which of the assumable Contracts Buyer elects to assume at Closing, in Buyer’s sole and absolute discretion; provided that to the extent that any Contract expressly requires payment of a penalty, premium, or damages, including liquidated damages, for cancellation and Buyer elects not to assume such Contract, then Buyer shall be solely responsible for the payment of the same, which obligation shall survive Closing. If Buyer fails to provide such notice, Buyer shall be deemed to have elected not to assume any of the Contracts. Promptly following expiration of the Due Diligence Period, Seller shall notify the vendors under those Contract(s) that Buyer has not agreed to assume (with a copy of such notice to Buyer) and, provided that Closing occurs hereunder, such Contracts shall terminate effective as of the Date of Closing. Seller shall cooperate with Buyer, both before and after the Close of Escrow, to obtain any approvals or consents required to assign any Contracts to Buyer, including, without limitation, sending requests for such approvals or consents to the party or parties whose consent or approval is required. If Seller fails

to timely send any such request for approval or consent, Buyer may do so in Seller’s name. Seller’s obligations under this Section 6.6 shall survive the Close of Escrow for a period of three (3) months. Notwithstanding anything in this Agreement to the contrary, Buyer shall have no obligation to assume any obligation under any Contract for reimbursement of any amounts paid prior to the Closing Date upon termination of said Contract, and, if Buyer does assume such obligation, then Seller shall indemnify Buyer with respect thereto (except to the extent that such termination is due to an affirmative act or omission of Buyer resulting in a default under said Contract).

7.1    Seller’s Representations and Warranties. The representations, warranties and covenants of Seller in this Section 7.1 shall survive the Closing for one (1) year. Seller represents, warrants and covenants to Buyer as of the Effective Date and as of the Closing Date as follows:

7.1.1    Seller is duly organized, validly existing and in good standing under the laws of the State of Illinois. Seller has full power and authority to enter into this Agreement and to perform this Agreement. The execution, delivery and performance of this Agreement by Seller have been duly and validly authorized by all necessary action on the part of Seller and all required consents and approvals have been duly obtained. This Agreement is a legal, valid and binding obligation of Seller, enforceable against Seller in accordance with its terms. There is no agreement to which Seller is a party or, to Seller’s knowledge, that is binding on Seller which is in conflict with this Agreement.

7.1.2    All of the Personal Property is described in Exhibit “B-1” attached hereto, which is a materially accurate and complete list of all material tangible personal property owned by Seller relating to the ownership, management, operation, maintenance or repair of the Real Property. All of the Personal Property is located at the Real Property. Seller has (and can convey at Closing) good title to the Personal Property and the Intangible Property, free and clear of all liens, encumbrances, security interests and adverse claims of any kind or nature whatsoever, other than liens, encumbrances and security interests that will be terminated at or prior to Closing.

7.1.3    All of the Leases are described in Schedule 1 attached hereto, and there are no persons leasing, using or occupying the Real Property or any part thereof except the tenants under the Leases. All of the Contracts are described in Schedule 2 attached hereto, which is an accurate and complete list of all presently effective contracts, agreements, warranties and guaranties relating to the leasing, advertising, promotion, design, construction, ownership, management, operation, maintenance or repair of the Real Property. All of the Approvals are described in Schedule 3 attached hereto, which is an accurate and complete list of all presently effective building permits, certificates of occupancy, and other certificates, permits, licenses and approvals relating to the design, construction, ownership, occupancy, use, management, operation, maintenance or repair of the Real Property. Seller has (and can convey at Closing) good title to the Leases, the Contracts and the Approvals, free and clear of all liens, encumbrances, security interests and adverse claims of any kind or nature whatsoever, other than liens, encumbrances and security interests that will be terminated at or prior to Closing.

7.1.4    The rent roll attached hereto as Schedule 1 is, and each updated rent roll provided after the date hereof will be, accurate and complete in all material respects as of the date thereof (each a “Rent Roll”). Except as set forth on the applicable Rent Roll, to the best of Seller’s knowledge: (a) the Leases are in full force and effect, have not been amended or modified, and the full current rent is accruing thereunder, (b) no monthly rent has been paid more than one (1) month in advance (except as otherwise expressly permitted or required pursuant to the terms of the Lease) and no security deposit or prepaid rent has been paid, (c) no event has occurred or condition exists which, with or without notice or the passage of time, or both, would constitute a breach or a default by the landlord or by any tenant under the Leases, (d) Seller has received no notice from any tenant under the Leases claiming any breach or default by Seller under any of the Leases, and (e) no concession, moving or relocation allowance or credit, or other payment or credit of any kind is presently owed, or will or could become due and payable, to any tenant under the Leases.

7.1.5    Seller has received no written notice from any insurance broker, agent or underwriter that any non-insurable condition exists in, on or about the Real Property or any part thereof. Seller has received no written notice that, the Property and every part thereof and the use and occupancy thereof are not in compliance with all applicable building, earthquake, zoning, land use, environmental, antipollution, health, fire, safety, access and accommodations for the physically handicapped, subdivision, energy and resource conservation and similar laws, statutes, rules, regulations and ordinances and all covenants, conditions and restrictions applicable to the Real Property. Seller has received no notice, citation or other claim alleging any violation of any such law, statute, rule, regulation, ordinance, covenant, condition or restriction. To Seller’s knowledge, Seller has performed, satisfied and discharged all of the obligations, requirements and conditions imposed on the Real Property by the Approvals and the Permitted Exceptions.

7.1.6    Seller has received no written notice of the presence of any Hazardous Substances (as defined below) or the violation of any Environmental Laws (as defined below) at the Property, except as described in any environmental report provided by Seller as part of Seller’s Deliveries. Except for the foregoing sentence, the “as-is” provisions of Section 1.2 shall apply to any and all environmental conditions of the Property, except Seller shall reasonably cooperate with Buyer obtaining, at Buyer’s cost, a Phase I Environmental Report regarding the Property or update, at Buyer’s cost, any environmental report provided by Seller as part of Seller’s Deliveries.

7.1.7    To the best of Seller’s knowledge, and except for a possible personal injury claim due to a “slip and fall” type accident which is expected to be fully covered by insurance (and as to which Seller shall provide to Buyer all non-privileged information requested by Buyer), there is no litigation, arbitration or other legal or administrative suit, action, proceeding or investigation of any kind pending (including, without limitation, involving the federal Department of Housing and Urban Development or the Americans with Disabilities Act of 1990, as amended, or any other law, rule or regulation governing access by disabled persons, any land use or zoning action, any condemnation, eminent domain or similar action, or any action to contest or appeal the amount of real or person property taxes or assessments) or, to Seller’s knowledge, threatened against or involving Seller or relating to the Property or any part thereof and, to Seller’s knowledge, there is no valid basis for any such litigation, arbitration or other legal or administrative suit, action, proceeding or investigation.

7.1.8    Seller is not a “foreign person” as defined in Section 1445 of the Internal Revenue Code of 1986, as amended, and the Income Tax Regulations thereunder.

7.1.9    No withholding of tax will be required with respect to the sale of the Property by Seller.

7.1.10    Seller is solvent, has not made a general assignment for the benefit of its creditors, and has not admitted in writing its inability to pay its debts as they become due, nor has Seller filed, nor does it contemplate the filing of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or any other proceeding for the relief of debts in general, nor has any such proceeding been instituted by or against Seller.

7.1.11    Except for Todd Stofflet – Managing Partner of KIG (“Broker”), Seller has not dealt with any investment adviser, real estate broker or finder, or incurred any liability for any commission or fee to any investment adviser, real estate broker or finder, in connection with the sale of the Property to Buyer or this Agreement.

7.1.12    All loans with lenders with liens affecting the Property are currently in good standing and not in default, and Seller shall cause all lenders, including, without limitation, Lenders, to reconvey or release (as applicable) such liens at the Close of Escrow.

7.1.13    The transaction contemplated by this Agreement (and any underlying obligations contemplated by this Agreement) does not and shall not constitute a non-exempt prohibited transaction under the Employee Retirement Income Security Act of 1974 (“ERISA”) or a comparable violation of state law.

7.1.14    Seller is not any of the following: (i) a person or entity that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224 on Terrorist Financing (effective September 24, 2001) (herein called the “Executive Order”); (ii) a person or entity owned or controlled by, or acting for or on behalf of any person or entity that is listed in the Annex to, or is otherwise subject to the provisions of, the Executive Order; (iii) a person or entity that is named as a “specifically designated national” or “blocked person” on the most current list published by the U.S. Treasury Department’s Office of Foreign Assets Control (herein called “OFAC”) at its official website, http://www.treas.gov/offices/enforcement/ofac; (iv) a person or entity that is otherwise the target of any economic sanctions program currently administered by OFAC; or (v) a person or entity that is affiliated with any person or entity identified in the foregoing clauses (i), (ii), (iii), or (iv).

7.1.15    Seller owns no real property or personal property except for the Property. No affiliate of Seller owns any real or personal property (tangible or intangible, and specifically including contract rights) located on or used solely in connection with the Property

7.1.16    To the best of Seller’s knowledge, all of the Seller Deliveries provided to Buyer are true and complete copies of such documents, and all material documents concerning the Property that are in Seller’s possession or reasonable control have been included in the Seller Deliveries.

7.1.17    To the best of Seller’s knowledge, Seller’s property manager employed at or in connection with the Property have been paid their respective salaries and any fringe benefits (including vacation and sick-leave) accruing through the Effective Date and will be paid in full as of the Closing Date. Seller represents it has no employees.

7.1.18    Neither Seller nor any previous owner of the Property has sold, transferred, conveyed, or entered into any agreement regarding water or water rights relating to the Property, except as otherwise expressly set forth in the Title Commitment.

The phrases “to the best of Seller’s Knowledge”, “to the knowledge of Seller” and words of similar import shall mean the actual, current knowledge of Stephen McPartlin, Manager of Seller, or Chris McPartlin, agent for the Seller, without any independent investigation, and does not include any imputed or constructive knowledge that may be attributed to such individuals. Such individuals shall have absolutely no personal liability under this Agreement.

7.2    Buyer’s Representations and Warranties. The representations, warranties and covenants of Buyer in this Section 7.2 shall survive the Closing for one (1) year. Buyer represents, warrants and covenants to Buyer as of the Effective Date and as of the Closing Date as follows:

7.2.1    Buyer is duly organized, validly existing, and in good standing under the laws of the State of its formation.

7.2.2    Buyer has all requisite power and authority to execute and deliver this Agreement and to carry out its obligations hereunder and the transactions contemplated hereby. This Agreement has been, and the documents contemplated hereby will be, duly executed and delivered by Buyer and constitute its legal, valid, and binding obligation enforceable against it in accordance with its terms.

7.2.3    Buyer is not any of the following: (i) a person or entity that is listed in the annex to, or is otherwise subject to the provisions of the Executive Order; (ii) a person or entity owned or controlled by, or acting for or on behalf of any person or entity that is listed in the Annex to, or is otherwise subject to the provisions of, the Executive Order; (iii) a person or entity that is named as a “specifically designated national” or “blocked person” on the most current list published by OFAC at its official website, http://www.treas.gov/offices/enforcement/ofac; (iv) a person or entity that is otherwise the target of any economic sanctions program currently administered by OFAC; or (v) a person or entity that is affiliated with any person or entity identified in the foregoing clauses (i), (ii), (iii), or (iv).

7.2.4    Except for Broker, Buyer has not dealt with any investment adviser, real estate broker or finder, or incurred any liability for any commission or fee to any investment adviser, real estate broker or finder, in connection with the purchase of the Property or this Agreement.

8.    COVENANTS.

8.1    Seller. Seller covenants and agrees with Buyer as follows:

8.1.1    Between the Effective Date and the Closing Date, Seller shall not execute any new lease, contract, approval or encumbrance affecting the Property or amend, modify, renew, extend or terminate any of the existing Leases, Contracts, Approvals or Permitted Exceptions without the prior approval of Buyer, which approval may be withheld in Buyer’s sole and absolute discretion; provided, however, that any Leases that are either renewed on a month-to-month basis or are consistent with the current leasing practices of Seller as of the Effective Date, including, without limitation, current rental rates and concessions as of the Effective Date, shall be deemed to be automatically approved by Buyer. Under no circumstance may Seller enter into any new lease for a term of less than 6 months or more than 15 months, or accept any payments under any Leases more than 2 months in advance. Further, Seller, in emergency situations or in situations that are critical to the operation of the Property, may enter into Contracts for goods and services without the approval of Buyer, provided that such Contracts must be terminable upon no more than thirty (30) days’ notice without payment of any penalty or fee. Notwithstanding anything herein to the contrary, Buyer shall be deemed to have approved a proposed lease or contract if Buyer has not made an objection to such lease or contract within two (2) Business Days after Buyer’s receipt of such proposed lease or contract and a written request for approval from Seller.

8.1.2    Between the Effective Date and the Closing Date, Seller shall manage, operate, maintain and repair the Property in the ordinary course of business in accordance with Seller’s current management, operating, maintenance and repair practices in effect as of the Effective Date (including, without limitation, maintenance of substantially the same advertising and marketing programs for the Real Property in effect as of the Effective Date), keep the Property in good repair and working order and sound condition, comply with the Approvals, Permitted Exceptions, and all covenants, conditions, restrictions, laws, statutes, rules, regulations and ordinances applicable to the Property, keep the Leases, the Contracts, the Approvals and Permitted Exceptions in force, and promptly give Buyer copies of all default and other material notices given or received by Seller under the Leases (exclusive of customary delinquency notices given to tenants) or the Contracts or any violation of or material matters concerning the Approvals, Permitted Exceptions or any covenants, conditions, restrictions, laws, statutes, rules, regulations or ordinances applicable to the Property. Seller shall not (i) create or agree to any easements, liens, mortgages, encumbrances or other interests that would affect the Property or Seller’s ability to comply with this Agreement; (ii) initiate or consent to, approve or otherwise take any action with respect to zoning or any other governmental rules or regulations presently applicable to all or any part of the Real Property; or (iii) fail to pay in a timely fashion all proper bills for labor or services for work performed for or on behalf of Seller with respect to the Property. Between the Effective Date and the Closing Date, Seller shall keep in force property insurance covering all buildings, structures, improvements, machinery, fixtures and equipment included in the Real Property insuring against all risks of physical loss or damage, subject to standard exclusions, in an amount equal to the actual replacement cost (without deduction for depreciation) of such buildings, structures, improvements, machinery, fixtures and equipment.

8.1.3    Immediately after Seller obtains any written information indicating that any Hazardous Substances may be present or any Release or threatened Release of Hazardous Substances may have occurred in, on or under the Real Property (or any nearby real property which could migrate to the Real Property) or that any violation of any Environmental Laws may have occurred at the Real Property, Seller shall give written notice thereof to Buyer with a reasonably detailed description of the event, occurrence or condition in question. Seller shall immediately furnish to Buyer copies of all written communications received by Seller from any person (including notices, complaints, claims or citations that any Release or threatened Release of any Hazardous Substances or any violation of any Environmental Laws has actually or allegedly occurred) or given by Seller to any person concerning any past or present Release or threatened Release of any Hazardous Substances in, on or under the Real Property (or any nearby real property which could migrate to the Real Property) or any past or present violation of any Environmental Laws at the Real Property. Seller shall not be deemed to have breached the foregoing covenants with respect to Lawful Substances. As used in this Agreement, the following definitions shall apply: “Environmental Laws” shall mean all federal, state and local laws, ordinances, rules and regulations now or hereafter in force, as amended from time to time, in any way relating to or regulating human health or safety, or industrial hygiene or environmental conditions, or protection of the environment, or pollution or contamination of the air, soil, surface water or groundwater, and includes the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9601, et seq., the Resource Conservation and Recovery Act, 42 U.S.C. § 6901, et seq., the Clean Water Act, 33 U.S.C. § 1251, et seq., and the Hazardous Substance Account Act. “Hazardous Substances” shall mean any substance or material that is described as a toxic or hazardous substance waste or material or a pollutant or contaminant, or words of similar import, in any of the Environmental Laws, and includes, without limitation, asbestos, petroleum (including crude oil or any fraction thereof, natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable for fuel, or any mixture thereof), petroleum products, polychlorinated biphenyls, urea formaldehyde, radon gas, radioactive matter, medical waste, and chemicals which may cause cancer or reproductive toxicity. “Release” shall mean any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping or disposing into the environment, including continuing migration, of Hazardous Substances into or through soil, surface water or groundwater. “Lawful Substances” shall mean the safe and lawful use and storage by Seller, any tenant or any other person of quantities of (i) pre-packaged supplies, cleaning materials and petroleum products customarily used in the operation and maintenance of comparable multifamily properties, (ii) cleaning materials, personal grooming items and other items sold in pre-packaged containers for consumer use and used by tenants and occupants of residential dwelling units in the Property, and (iii) petroleum products used in the operation and maintenance of motor vehicles from time to time located on the Property’s parking areas, so long as all of the foregoing are used, stored, handled, transported and disposed of in compliance with Environmental Laws (collectively, “Lawful Substances”)

8.1.4    Seller shall promptly (i) notify Buyer in writing of any litigation, arbitration, condemnation or administrative hearing before any court or governmental agency concerning Seller or the Property that is instituted after the Effective Date, other than eviction or unlawful detainer actions that will be completed prior to Closing, (ii) provide to Buyer copies of any Leases or Contracts entered into after the Effective Date (subject to the terms of Section 8.1.1

above) and any documents or materials received by Seller from and after the Effective Date that would have been included in Seller Deliveries if received prior to such date, and (iii) within three (3) Business Days after Seller’s receipt of request therefor, provide to Buyer an updated Rent Roll with all information concerning the Leases updated through the date that is three (3) Business Days before the date that the updated Rent Roll is delivered to Buyer.

8.1.5    Seller shall indemnify and defend Buyer against and hold Buyer harmless from all claims, demands, liabilities, losses, damages, costs and expenses, including reasonable attorneys’ fees and disbursements, (i) that may be suffered or incurred by Buyer if any representation or warranty made by Seller in Section 7.1 hereof, excluding Section 7.1.17, was untrue or incorrect in any material respect when made or deemed remade or that may be caused by any breach by Seller of any such representation or warranty or any breach of this Agreement, or (ii) arising from or based on any failure by Seller to perform all obligations of Seller in accordance with the Leases, Contracts, Approvals, Permitted Exceptions or applicable laws before the Closing Date, or any third party property damage or personal injury occurring in, on or about the Real Property before the Closing Date.

8.1.6    Between the Effective Date of this Agreement and the Closing Date, Seller shall not (i) in any manner sell, convey, assign, transfer, encumber or otherwise dispose of the Property or any part thereof or interest therein, or (ii) market, initiate, solicit, continue or respond to any offers or negotiations related to the sale of the Property or any material portion thereof or interests therein.

8.1.7    Seller shall not dissolve its existing entity and shall remain validly existing and in good standing under the laws of the State of its formation during the period commencing on the Effective Date of this Agreement and ending on the date that is nine (9) months after the Closing Date; provided, however, that if Buyer gives Seller written notice of a claim under this Agreement on or before the expiration of such period or final tax pro-rations remain outstanding, such covenant shall extend until the date such claim has been satisfactorily resolved in Buyer’s reasonable discretion and/or such final tax pro-rations have been paid.

The indemnification obligations of Seller set forth in this Section 8.1 shall survive the Closing for a period of nine (9) months. Any claim made by Buyer in connection with said indemnities shall be made within nine (9) months after the Closing or termination or shall automatically be null, void and of no force or effect whatsoever, and Buyer’s remedies for any such claim shall be limited to recovery of damages not to exceed an amount equal to one and one-half percent (1.5%) of the Purchase Price; provided, however, that there shall be no such monetary limitation on Buyer’s damages in connection with any third party personal injury claims; and provided further however that Buyer shall not be entitled to indemnification from Seller with respect to a breach by Seller of a representation or warranty or of this Agreement of which Buyer had actual knowledge prior to Closing, it being understood and agreed that Buyer’s remedies with respect to any such breach actually discovered by Buyer prior to Closing shall be as set forth in Section 3.4 above.

8.2    Buyer. Buyer covenants and agrees with Seller as follows: 8.2.1    Buyer shall indemnify and defend Seller against and hold Seller harmless from all claims, demands, liabilities, losses, damages, costs and expenses, including reasonable attorneys’ fees and disbursements, (i)

that may be suffered or incurred by Seller if any representation or warranty made by Buyer in Section 7.2 hereof was untrue or incorrect in any material respect when made or deemed remade or that may be caused by any breach by Buyer of any such representation or warranty or any breach of this Agreement, or (ii) arising from or based on any failure by Buyer to perform all obligations of Buyer in accordance with the Leases, Contracts Approvals, Permitted Exceptions or applicable laws arising and accruing on or after the Closing Date and during Buyer’s ownership of the Property, or any third party property damage or personal injury occurring in, on or about the Real Property from or after the Closing Date.

The indemnification obligations of Buyer set forth in this Section 8.2 shall survive the Closing for a period of nine (9) months. Any claim made by Seller in connection with said indemnities shall be made within nine (9) months after the Closing or termination or shall automatically be null, void and of no force or effect whatsoever, and Seller’s remedies for any such claim shall be limited to recovery of damages not to exceed an amount equal to one and one-half percent (1.5%) of the Purchase Price; provided, however, that there shall be no such monetary limitation on Seller’s damages in connection with any third party personal injury claims; and provided further however that Seller shall not be entitled to indemnification from Buyer with respect to a breach by Buyer of a representation or warranty of which Seller had actual knowledge prior to Closing, it being understood and agreed that Seller’s remedies with respect to any such breach actually discovered by Seller prior to Closing shall be as set forth in Section 3.3 above.

8.3    Broker Indemnity. Seller hereby agrees to indemnify and hold Buyer harmless from and against any and all claims for brokerage or finder’s fees or other similar commissions or compensation made by any and all other brokers or finders claiming to have dealt with Seller in connection with this Agreement or the consummation of the transaction contemplated hereby. Buyer hereby agrees to indemnify and hold Seller harmless from and against any and all claims for brokerage or finder’s fees or other similar commissions or compensation made by any and all other brokers or finders claiming to have dealt with Buyer in connection with this Agreement or the consummation of the transaction contemplated hereby, other than Broker. The terms of this Section 8.3 shall survive Closing.

9.    ADJUSTMENTS AND PRORATIONS.

9.1    Generally. All taxes (including, without limitation, real estate taxes and personal property taxes), collected rents, laundry income, fees, rents and other income paid under any contracts Buyer elects to assume pursuant to Section 6.6 above (including, without limitation, any amounts paid on or in connection with the execution of the applicable contract for rights and privileges provided over the term of the applicable contract), parking income, furniture rental, charges for utilities (including water, sewer, gas, and fuel oil) and for utility services, maintenance and service contracts under any contracts Buyer elects to assume pursuant to Section 6.6 above, all other operating costs and expenses that are customarily prorated in similar transactions (but not including insurance premiums, management fees, employee costs, etc.), and all other income of every kind that in any manner relates to the operation of the Property shall be prorated as of 11:59 p.m. the day immediately preceding the Date of Closing (the “Proration Date”). If the amount of any such items is not known on the Proration Date, they shall be apportioned on the basis of the amounts for the preceding year, with a reapportionment as soon as the new amounts can be ascertained. Given real estate taxes are paid in arrears in the State of Illinois, real estate taxes shall be prorated based upon a separate real estate tax re-proration agreement drafted by Seller’s counsel and approved by Buyer’s counsel. Any deposits on utilities paid by Seller shall be returned to Seller.

On the Date of Closing, Seller shall deliver to Buyer all inventories of supplies on hand at the Property owned by Seller, if any, at no additional cost to Buyer.

9.2    Rental Income. Rental income from the Property (including, without limitation, laundry income, late fees and charges, and all other payments received from tenants under or in connection with the Leases) shall be prorated as of the Proration Date. Non-delinquent rents shall be prorated as of the Proration Date. Rents delinquent as of the Proration Date (i.e., rents that are due and owing after the expiration of any applicable grace period or, if no grace period is provided, after the date such rents are due), but collected later, shall be prorated as of the Proration Date when collected. Rents collected after the Proration Date from tenants whose rental was delinquent at the Proration Date shall be deemed to apply first to the current rental due at the time of payment and second to rentals which were delinquent as of the Proration Date. Rents collected after the Proration Date to which Seller is entitled shall be promptly paid to Seller. For a period of sixty (60) days after the Closing Date, Buyer shall use reasonable efforts to collect all rents which are delinquent as of the Proration Date with no obligation to incur any expenses or commence litigation to collect such rents. Commencing as of sixty one (61) days after the Closing Date, Seller may use reasonable efforts, including litigation, to collect any rents delinquent as of the Proration Date which are still uncollected; provided, however, in exercising its remedies against tenants as outlined in this Section, Seller shall not evict any tenant of the Property or otherwise unreasonably interfere with Buyer’s operation of the Property. With respect to all unapplied security deposits, if any, made by tenants at the Property, Buyer shall receive a credit toward the Purchase Price for all such security deposits then held on behalf of Seller at Closing. Any leasing commissions with respect to the Leases shall be the sole responsibility of Seller, and shall be paid or discharged fully at or prior to Closing.

9.3    RUBS. Within ninety (90) days after the Closing Date, all reimbursable utility bills for utility charges incurred by Seller and reimbursable to Seller from the tenants under the Leases for periods prior to Closing (“RUBS”), if received by Buyer, shall be remitted by Buyer to Seller. Thereafter, Buyer shall have no obligation to remit RUBS income to Seller.

9.4    Proration Period. If any of the items subject to proration hereunder cannot be prorated as of the Proration Date because the information necessary to compute such proration is unavailable, or if any errors or omissions in computing prorations as of the Proration Date are discovered subsequent to the Close of Escrow, then such item shall be reapportioned and such errors and omissions corrected as soon as practicable after the Close of Escrow and the proper party reimbursed within thirty (30) days after such party’s receipt of written demand therefor. This covenant shall survive the Closing of the sale contemplated hereby for a period of two years (2) year with respect to tax prorations and ninety (90) days with respect to all other prorations, and shall then terminate.

9.5    Rent Ready Adjustments. Not more than forty-eight (48) hours prior to Close of Escrow (“Walk Through Date”), a representative of Buyer and a representative of Seller shall conduct an onsite walk-through of the then unoccupied rental units on the Property to determine whether such unoccupied rental units are in “rent ready” condition. With respect to any rental unit that is vacated either (a) on or before five (5) days prior to Close of Escrow that Seller has not placed

in a “rent ready” condition before the Walk Through Date or (b) on or after the Walk Through Date, Buyer shall receive a credit against the Purchase Price at Closing in the amount of $750 per unit. As used herein, “‘rent ready’ condition” means Seller’s practice and procedures, as of the date of this Agreement, for placing units in “rent ready” condition. Nothing contained in this Section 9.5 shall be construed as limiting Buyer’s rights and Seller’s obligations under the other provisions of this Agreement.

10.    CLOSING DOCUMENTS.

10.1    Seller’s Deliveries. Conditioned upon performance by Buyer hereunder, Seller shall execute and deliver to Escrow Holder prior to Closing the following:

10.1.1    Deed. A special warranty deed with respect to the Real Property, in the form of attached Exhibit “D” (the “Deed”), subject only to the Permitted Exceptions;

10.1.2    Assignment and Assumption of Leases, Contracts and Approvals. An assignment of all of Seller’s right, title and interest in and to the Leases, Contracts and Approvals in the form of attached Exhibit “E” (“General Assignment”);

10.1.3    Bill of Sale. A bill of sale in the form of attached Exhibit “F”, assigning and transferring to Buyer all of the right, title, and interest of Seller in and to the Personal Property and the Intangible Property;

10.1.4    Non-Foreign Certificate. A certification that Seller is not a non-resident alien (a foreign corporation, partnership, trust, or estate as defined in the Internal Revenue Code and Treasury Regulations promulgated thereunder), in the form of attached Exhibit “G”;

10.1.5    Tenant Notices. Notices to the tenants under all Leases of the occurrence of the sale of the Property in the form of attached Exhibit “H”, as may be modified at the reasonable request of Buyer to conform to the requirements of applicable law;

10.1.6    Affidavit(s). An affidavit of Title in form customarily used in real estate transactions in the State of Illinois and ALTA statement, with ALTA statement in such form customarily used by Escrow Holder, identifying no construction, debts, liens or parties in possession (other than residential tenants disclosed to Buyer) that may affect the Property after the Closing Date;

10.1.7    Gap Indemnity. If requested by Escrow Holder to facilitate Closing, a gap indemnity in the form customarily used by Escrow Holder; and

10.1.8    Rent Roll. An updated Rent Roll, in the same form and with the same categories of information as on the initial Rent Roll, with all information concerning the Leases updated through the Proration Date.

10.2    Buyer’s Deliveries. Conditioned upon performance by Seller hereunder, Buyer shall execute and deliver to Escrow Holder prior to Closing the General Assignment.

10.3    Other Closing Documents. Each party shall deliver to the other party or Escrow Holder such duly executed and acknowledged or verified certificates, affidavits, and other usual and customary closing documents respecting the power and authority to perform the obligations hereunder and as to the due authorization thereof by the appropriate corporate, partnership, or other representatives acting for it, as counsel for the other party or Escrow Holder may reasonably request, and such conveyancing or transfer tax forms or returns, if any, as are required to be delivered by Seller or Buyer under applicable state or local law in connection with the conveyance of the Real Property. Each party shall deliver any additional documents that the other party or Escrow Holder may reasonably require for the proper consummation of the transaction contemplated by this Agreement; provided, however, that no such additional document shall expand any obligation, covenant, representation or warranty of such party or result in any new or additional obligation, covenant, representation or warranty of such party under this Agreement beyond those expressly set forth in this Agreement.

10.4    Closing Documents. All documents to be delivered to Escrow Holder pursuant to this Section 10 shall hereinafter be referred to as “Closing Documents”.

10.5    Possession. Upon Closing, Seller shall deliver to Buyer sole possession of the Property, subject to the rights of tenants in possession (as residential tenants only) under the Leases.

11.    COSTS. Seller shall pay the State of Illinois and County of Lake real estate transfer taxes and documentary stamps, the cost of the Title Commitment and any updates thereto, the cost of a standard ALTA Owner’s Policy of Title Insurance (the “Title Policy”), the costs of any endorsements to the Title Policy to the extent that such endorsements are necessary to cure any Objections that Seller has elected or is required to cure, all fees to Broker, and the cost of preparation of Seller’s Closing Documents. Buyer shall pay the cost for extended ALTA title insurance coverage, if desired, the cost of any endorsements to the title policy (if requested by Buyer), the cost of preparation of Buyer’s Closing Documents, and the cost of any updated survey, if desired. Seller and Buyer shall each pay one-half (1/2) of (i) Escrow Holder’s escrow fee including the cost of a New York style closing (excluding charges assessed by Escrow Holder for special services, which shall be paid by the party requesting or using such special services), (ii) recording fees for the Deed, and (iii) other closing costs. Each party shall pay its own attorney’s fees. Any municipal transfer taxes or inspection fees shall be paid by the party as specified in the applicable local ordinance.

12.    CASUALTY OR CONDEMNATION.During the period from the Opening of Escrow through Closing, all risk of loss from fire or other casualty or condemnation shall be borne by Seller. If, prior to Closing, all or any portion of the Property is damaged by fire or other natural casualty (collectively “Damage”) or is taken or made subject to condemnation, eminent domain, or other governmental acquisition proceedings (collectively “Eminent Domain”), then Seller shall promptly notify Buyer and the following procedures shall apply:

 

12.1    If the aggregate cost of repair and/or replacement of the Damage (collectively, “repair and/or replacement”) is $50,000 or less, in the opinion of Buyer’s and Seller’s respective engineering consultants, Buyer shall close and take the Property as diminished by such events, subject to a reduction in the Purchase Price applied against the cash otherwise due at the Closing in the full amount of the repair and/or replacement. Any casualty insurance shall be the sole property of Seller.

12.2    If the aggregate cost of repair and/or replacement is greater than $50,000, in the opinion of Buyer’s and Seller’s respective engineering consultants, or in the event of Eminent Domain, then Buyer may terminate this Agreement in which Deposit shall be returned to the Buyer. If Buyer does not elect to terminate this Agreement, then Buyer shall close and take the Property as diminished by such events, subject to a reduction in the Purchase Price applied against the cash otherwise due at the Closing in the full amount of the repair and/or replacement and any casualty insurance shall be the sole property of Seller.

12.3    In the event of a dispute between Seller and Buyer with respect to the cost of repair and/or replacement with respect to the matters set forth in this Section, an engineer designated by Seller and an engineer designated by Buyer shall select an independent engineer licensed to practice in the jurisdiction where the Property is located who shall resolve such dispute. All fees, costs, and expenses of this third engineer so selected shall be shared equally by Buyer and Seller.

13.    ATTORNEYS’ FEES.Notwithstanding anything to the contrary in this Agreement, in any action to enforce or interpret the provisions of this Agreement, the prevailing party shall be entitled to request that the court, arbitration panel, or other tribunal order an award of its attorneys’ fees and costs. The terms of this Section 13 shall survive Closing or any earlier termination of this Agreement.

14.    ASSIGNMENT.Buyer shall have the right, with approval of Seller, before the Closing Date, to assign this Agreement or to have Seller convey, assign and transfer the Property at the Closing in accordance with this Agreement to any person or entity designated by Buyer in such notice; except that no approval of Seller shall be required for the assignment by Buyer to any affiliate of Steadfast Apartment REIT, Inc. or Steadfast Apartment REIT III, Inc. Except in connection with a like-kind exchange as provided in Section 26, Seller may not assign this Agreement.

15.    WAIVER.No waiver of any breach of any agreement or provision contained herein shall be deemed a waiver of any preceding or succeeding breach of any other agreement or provision herein contained. No extension of time for the performance of any obligation or act shall be deemed an extension of time for the performance of any other obligation or act.

16.    GOVERNING LAW; TIME.This Agreement shall be construed under the laws of the State in which the Real Property is located being Illinois (without regard to the principles thereof governing conflicts of laws). All periods of time referred to in this Agreement shall include all business and non-business days unless business days are specified, however, that if the date or last date to perform any act or give a notice with respect to the Agreement shall fall on a day that is not

a business day, such act or notice may be timely performed or given on the next succeeding business day.

17.    NOTICES.All notices required or permitted to be given hereunder shall be in writing and sent by overnight delivery service (such as Federal Express), in which case notice shall be deemed given on the day after the date sent, or by personal delivery, in which case notice shall be deemed given on the date received, or by certified mail, in which case notice shall be deemed given three (3) days after the date sent, or by electronic mail (with copy by overnight delivery service), in which case notice shall be deemed given on the date sent, to the appropriate address set forth below or at such other place or places as either Buyer or Seller may, from time to time, respectively, designate in a written notice given to the other in the manner described above. In such case a copy of such notice shall also be sent by e-mail to counsel for the party at the e-mail address as appears below.

18.    ENTIRE AGREEMENT.This instrument, executed in duplicate, sets forth the entire agreement between the parties and may not be canceled, modified, or amended except by a written instrument executed by both Seller and Buyer.

19.    COUNTERPARTS; COPIES.This Agreement may be executed and delivered in any number of counterparts, each of which so executed and delivered shall be deemed to be an original and all of which shall constitute one and the same instrument. Electronic, photocopy and facsimile copies of signatures may be used in place and stead of original signatures with the same force and effect as originals.

20.    AUTHORITY.The individual(s) executing this Agreement on behalf of each party hereto hereby represent and warrant that he/she has the capacity, with full power and authority, to bind such party to the terms and provisions of this Agreement.

Seller shall promptly provide to Buyer (at Buyer’s expense) copies of, or shall provide Buyer reasonable access to, such factual information as may be reasonably requested by Buyer, and in the possession or control of Seller, or its property manager or accountants, to enable Buyer’s auditor to conduct an audit, in accordance with Rule 3-14 of Securities and Exchange Commission Regulation S-X, of the income statements of the Property for the year to date of the year in which Closing occurs plus the two (2) immediately preceding calendar years (provided, however, that other than fees paid or payable to Seller, a Seller affiliate or a third party for on-site property management, such audit shall not include an audit of asset management fees internally allocated by Seller (as opposed to paid to a third party) or interest expenses attributable to the Seller). In no event shall Seller be obligated to deliver any Excluded Documents to Buyer. Buyer shall be responsible for all out-of-pocket costs, including Seller’s reasonable legal and accounting fees associated with this audit. Seller shall reasonably cooperate (at no cost to Seller) with Buyer’s auditor in the conduct of such audit. In addition, Seller agrees to provide to Buyer or any affiliate of Buyer, if requested by such auditor, historical financial statements for the Property, including (without limitation) income and balance sheet data for the Property, whether required before or after Closing. Without limiting the foregoing, (i) Buyer or its designated independent or other auditor may audit Seller’s operating statements of the Property, at Buyer’s expense, and Seller shall provide such documentation as Buyer or its auditor may reasonably request in order to complete such audit, and (ii) Seller shall furnish to Buyer such financial and other information as may be reasonably required by Buyer or any affiliate of Buyer to make any required filings with the Securities and Exchange Commission or other governmental authority. Seller’s obligation to maintain its records for use under this Section 21 shall be an on-going condition to Buyer’s obligation to Close Escrow, and Seller shall maintain its records for use under this Section 21 for a period of not less than two (2) years after the Closing Date. The provisions of this Section shall survive Closing. Notwithstanding anything in this Agreement to the contrary, it shall not be a default or breach by Seller of this Agreement if, after making diligent and good faith efforts to provide all information in Seller’s possession or reasonable control (including that of its auditors, accountants, current property manager and previous property manager (Fiduciary)) for Buyer’s audit under this Section 21, Buyer’s auditors reasonably determine that the Property is not auditable; in which event Buyer’s sole remedies shall be to either terminate this Agreement and receive a refund of its Deposit, or to proceed to close without such information.

22.    CONTRACT CONSIDERATION.The parties have bargained for and expressly agree that the rights and obligations of each party contained in this Agreement, including, without limitation, Buyer’s obligation to

deliver the Initial Deposit to Escrow Holder, constitute sufficient consideration for the other party’s execution, delivery and performance of this Agreement in accordance with its terms, including without limitation, Buyer’s exclusive right to inspect and purchase the Property pursuant to this Agreement and all contingencies and conditions of Closing for the benefit of Buyer set forth in this Agreement.

23.    JURY TRIAL WAIVER.EACH OF THE PARTIES HEREBY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO WHICH SELLER AND/OR BUYER MAY BE PARTIES ARISING OUT OF, IN CONNECTION WITH, OR IN ANY WAY PERTAINING TO, THIS AGREEMENT. THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE BY THE PARTIES AND EACH HEREBY REPRESENTS AND WARRANTS TO THE OTHER THAT NO REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY INDIVIDUAL TO INDUCE THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS EFFECT. EACH PARTY FURTHER REPRESENTS AND WARRANTS TO THE OTHER THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, OF ITS OWN FREE WILL, AND HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL. THE PROVISIONS OF THIS SECTION SHALL SURVIVE CLOSING OR THE TERMINATION OF THIS AGREEMENT.

24.    COUNSEL.EACH PARTY HERETO WARRANTS AND REPRESENTS THAT EACH PARTY HAS BEEN REPRESENTED BY COUNSEL OF ITS CHOICE IN CONNECTION WITH THE EXECUTION OF THIS AGREEMENT AND HAS HAD AMPLE OPPORTUNITY TO READ, REVIEW, AND UNDERSTAND THE PROVISIONS OF THIS AGREEMENT.

25.    EQUAL PARTICIPATION.SELLER AND BUYER HAVE PARTICIPATED EQUALLY IN THE PREPARATION OF THIS AGREEMENT, AND, THEREFORE, THIS AGREEMENT AND EACH PROVISION HEREOF SHALL NOT BE CONSTRUED IN FAVOR OF OR AGAINST ANY PARTY TO THIS AGREEMENT BY REASON OF ONE PARTY’S BEING DEEMED TO PREPARED THIS AGREEMENT OR IMPOSED SUCH PROVISION.

Should Seller intend to complete a like-kind exchange in accordance with Section 1031 of the Internal Revenue Code (“like-kind exchange”), Seller may enter into a like-kind exchange agreement with a third party exchange accommodation titleholder or qualified intermediary and, in connection therewith, assign its rights under this Agreement to said third party provided that said Agreement shall be binding upon the assignee in all respects as to the obligations to the Buyer. Buyer hereby agrees to reasonably cooperate with Seller in the like-kind exchange without any cost, expense or liability to Buyer and without reduction or alteration of the rights of Buyer under this Agreement and with respect to Seller; provided, however that Buyer shall not be required to undertake any liability or obligation and provided further that such like-kind exchange does not extend the Closing Date or be a condition to Closing. As part of such like-kind exchange, Seller shall convey the Property directly to Buyer and Buyer shall not be obligated to acquire any other property or interests as part of such like-kind exchange. Seller shall indemnify and hold Buyer harmless and defend Buyer from any and all claims, demands, causes of action, liabilities, losses, costs, damages and expenses (including reasonable attorneys’ fees and expenses and court costs) of any kind and nature in connection with such like-kind exchange for benefit of Seller or Buyer’s cooperation with Seller to accomplish such like-kind exchange. Nothing herein shall release Seller

of any of the obligations or liabilities under this Agreement. The terms of this Section 26 shall survive Closing or any earlier termination of this Agreement.

The Seller Deliveries are hereby deemed confidential and shall be kept confidential, and not be disclosed or published in any manner, by Buyer without the express written consent of Seller, except for any Permitted Disclosures (as hereinafter defined). Additionally, except for any Permitted Disclosures, Buyer and Seller agree to keep, and to direct their agents, employees, representatives and brokers to keep, the existence and content of this Agreement and the transaction contemplated herein confidential. Seller and Buyer covenant and agree that neither of them will issue any press releases regarding the Property or the transaction contemplated herein that identifies the other party without the prior consultation and express written approval of the other, which approval shall not be unreasonably withheld, conditioned or delayed. Notwithstanding anything to the contrary hereinabove set forth, either party may disclose such information: (a) to its employees, agents, representatives, brokers, consultants, contractors, potential lenders, and to members of professional firms serving it or its potential lenders, (b) to Escrow Holder, (c) as permitted under Section 6.2, and (d) as any governmental or quasi-governmental agency may require, as is necessary in order to comply with applicable laws or any court order, or in response to or in connection with any legal process (collectively, the “Permitted Disclosures”). In addition, the confidentiality obligations of this Section 27 shall not apply to any information that is a matter of public record or generally available to the public (other than as a result of the disclosure thereof in breach of this Section). The provisions of this section shall survive Closing for a period of two years.

If Seller consists of more than one party, each shall be jointly and severally liable to perform the obligations of Seller under this Agreement.

THIS SPECIAL WARRANTY DEED, made this _____ day of ______, 2016, between ASHFORD PROPERTIES, LLC, Series D-Gurnee Partners at Carriage House, an Illinois limited liability company, duly authorized to transact business in the State of Illinois, party of the first part, and _____________, a Delaware limited liability company, with its offices at 18100 Von Karman Ave., Suite 500, Irvine, CA 92612, party of the second part, WITNESSETH, that the party of the first part, for and in consideration of Ten and 00/100 Dollars ($10.00) in hand paid by the party of the second part, the receipt whereof is hereby acknowledged, and pursuant to authority of the Members/Managers of said Company by these presents does REMISE, RELEASE, ALIEN AND CONVEY unto the party of the second part, and to its successors and assigns, FOREVER, all the following described real estate, situated in the County of Lake and State of Illinois known and described as follows, to wit:

See legal description attached hereto as Exhibit A and made a part hereof.

PIN:

Together with all and singular hereditaments and appurtenances thereunto belonging, or in anywise appertaining, and the reversion and reversions, remainder and remainders, rents, issues, and profits thereof, and all the estate, right, title, interest, claim or demand whatsoever, of the party of the first part, either in law or equity, of, in and to the above described premises, with the hereditaments and appurtenances: TO HAVE AND TO HOLD the said premises as above described, with the appurtenances, unto the party of the second part, its heirs and assigns forever.

And the party of the first part, for itself, and its successors, does covenant, promise and agree, to and with the party of the second part, its heirs and assigns, that it has not done or suffered to be done, anything whereby the said premises hereby granted are, or may be, in any manner encumbered or charged, except as herein recited; and that the said premises, against all persons lawfully claiming, or to claim the same, by, through or under it, it WILL WARRANT AND DEFEND SPECIALLY, subject to: See Exhibit B attached hereto and made a part hereof.

IN WITNESS WHEREOF, said party of the first part has caused its seal to be hereto affixed, and has caused its name to be signed to these presents by its Manager, the day and year first above written.

By: _____________

Name: ____________

Title: _____________

_____________________

c/o Steadfast Companies

18100 Von Karman Ave., Suite 500

THIS ASSIGNMENT AND ASSUMPTION OF LEASES, CONTRACTS AND APPROVALS (this “Assignment”) is made as of the _____ day of __________________, 2016, by and between ASHFORD PROPERTIES, LLC, Series D-Gurnee Partners at Carriage House, an Illinois limited liability company (“Assignor”), and _________________________, a _________________________ (“Assignee”).

For good and valuable consideration, receipt and sufficiency of which are hereby acknowledged, Assignor and Assignee hereby agree as follows:

1.    Assignor hereby sells, transfers, assigns and conveys to Assignee the following:

(a)    All right, title and interest of Assignor in and to all leases and occupancy agreements relating to the Property, including, without limitation, those certain leases described on Exhibit A attached hereto and made a part hereof (collectively, the “Leases”), relating to the leasing of space in or on that certain land and improvements located in the County of Lake, State of Illinois, more particularly described in Exhibit B attached hereto (the “Property”), and all of the rights, interests, benefits and privileges of the lessor thereunder, and all prepaid rents and security and other deposits held by Assignor under the Leases and not credited to Assignee under the Purchase Agreement (defined below) or credited or returned to tenants; but subject to all terms, conditions, reservations and limitations set forth in the Leases.

(b)    To the extent assignable, all right, title and interest of Assignor in and to those certain contracts set forth on Exhibit C attached hereto and made a part hereof, and all warranties, guaranties, indemnities and claims (including, without limitation, for workmanship, materials and performance) and which exist or may hereafter exist against any contractor, subcontractor, manufacturer or supplier or laborer or other services relating thereto (collectively, the “Contracts”).

(c)    To the extent assignable, all right, title and interest of Assignor in and to all building permits, certificates of occupancy, and other certificates, permits, licenses and governmental approvals relating to the design, construction, ownership, occupancy, use, management, operation, maintenance or repair of the Property, including, without limitation, those identified on Exhibit D attached hereto and made a part hereof (collectively, the “Approvals”) and any plans, specifications, studies, reports or surveys relating to the Property.

2.    This Assignment is given pursuant to that certain Purchase and Sale Agreement and Joint Escrow Instructions (as amended, the “Purchase Agreement”) dated as of __________ 2016, between Assignor and Assignee’s predecessor-in-interest, STEADFAST ASSET HOLDINGS,

INC., a California corporation, providing for, among other things, the conveyance of the Leases, the Contracts and the Approvals.

3.    Assignee hereby accepts the assignment of the Leases, the Contracts and the Approvals and agrees to assume and discharge, in accordance with the terms thereof, all of the obligations thereunder arising from and after the date hereof.

4.    Assignor agrees to indemnify, defend and hold harmless Assignee from and against any and all claims, demands, liabilities, losses, damages, costs and expenses (including, without limitation, reasonable attorneys’ fees and expenses) asserted against or suffered or incurred by Assignee as a result of or in connection with any liabilities or obligations under all leases and occupancy agreements relating to the Property in effect at any time before the date hereof, and all contracts and agreements relating to the Property in effect at any time before the date hereof; provided, however, that Assignor’s indemnification obligations under this Paragraph 4 shall be limited to liabilities or obligations thereunder relating to periods before the date hereof. The indemnification obligation of Assignor set forth herein shall automatically expire nine (9) months after the date of this Agreement.

5.    Assignee agrees to indemnify, defend and hold harmless Assignor from and against any and all claims, demands, liabilities, losses, damages, costs and expenses (including, without limitation, reasonable attorneys’ fees and expenses) asserted against or suffered or incurred by Assignor as a result of or in connection with any liabilities or obligations under all leases and occupancy agreements relating to the Property in effect at any time on or after the date hereof, and all contracts and agreements relating to the Property in effect at any time on or after the date hereof; provided, however, that Assignee’s indemnification obligations under this Paragraph 5 shall be limited to liabilities or obligations thereunder relating to periods from and after the date hereof. The indemnification obligation of Assignee set forth herein shall automatically expire nine (9) months after the date of this Agreement.

6.    In any action to enforce the provisions of this Assignment, the prevailing party shall be entitled to an award of its attorneys’ fees and costs. This Assignment may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same Assignment. The terms, covenants and conditions hereof shall inure to the benefit of and be binding upon the respective parties hereto, their heirs, executors, administrators, successors and assigns. Any alteration, change or modification of or to this Assignment, in order to become effective, must be made in writing and in each instance signed on behalf of each party to be charged. No provision of this Assignment that is held to be inoperative, unenforceable or invalid shall affect the remaining provisions, and to this end all provisions of this Agreement shall be severable. This Assignment shall be governed by the laws of the State of Illinois.

7.    If Assignor consists of more than one party, each shall be jointly and severally liable to perform the obligations of Assignor under this Assignment.

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

Know all men by these presents, that ASHFORD PROPERTIES, LLC, Series D-Gurnee Partners at Carriage House, an Illinois limited liability company (“Grantor”), for and in consideration of the sum of ten dollars and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, does bargain, sell, grant, transfer, assign, and convey to _________________________, a Delaware limited liability company (“Grantee”) all of its right, title, and interest, if any, in and to any and all (i) tangible personal property owned by Grantor and now at, in or upon or used in connection with the property commonly known as Carriage House Apartments, located in the City of Gurnee, County of Lake and State of Illinois (“Property”), and more particularly described on Exhibit A attached hereto, including without limitation the tangible personal property listed on Schedule 1 attached hereto, and (ii) intangible personal property owned by Grantor in connection with or arising out of the ownership of the Property.

Grantor is selling and Grantee is purchasing the Property “AS IS WHERE IS” with all faults except as provided in that certain Purchase and Sale Agreement and Joint Escrow Instructions dated as of ______________, 2016 between Grantor and Grantee’s predecessor-in-interest, STEADFAST ASSET HOLDINGS, INC., a California corporation.

If Grantor consists of more than one party, each shall be jointly and severally liable to perform the obligations of Grantor under this Bill of Sale.

IN WITNESS WHEREOF, Grantor has executed this Bill of Sale as of the ____ day of ___________________, 2016.

Section 1445 of the Internal Revenue Code provides that a transferee of a U.S. real property interest must withhold tax if the transferor is a foreign person. To inform _________________________, a Delaware limited liability company (“Transferee”), that withholding of tax is not required upon the disposition of a U.S. real property interest by ASHFORD PROPERTIES, LLC, Series D-Gurnee Partners at Carriage House, an Illinois limited liability company (“Transferor”), the undersigned hereby certifies to Transferee the following on behalf of Transferor:

1.    Transferor is not a foreign corporation, foreign partnership, foreign trust, or foreign estate (as those terms are defined in the Internal Revenue Code and Income Tax Regulations);

2.    Transferor’s U.S. employer identification number is _____________; and

3.    Transferor’s office address is _________________________________________.

Transferor understands that this certification may be disclosed to the Internal Revenue Service by Transferee and that any false statement contained herein could be punished by fine, imprisonment, or both.

Under penalties of perjury, the undersigned declares that the undersigned has examined this certification and to the best of the undersigned’s knowledge and belief it is true, correct and complete, and the undersigned further declares that the undersigned has authority to sign this document on behalf of Transferor.

On         , before me,         ________            , a Notary Public personally appeared                                 , 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.

This letter is to notify you that the property commonly known as Carriage House Apartments, 4344 McClure Avenue, Gurnee, IL 60031 (“Property”) has this date been sold and the ownership transferred.

In connection with this sale, all of the interest of the lessor under your lease of space in the Property, together with your security deposit, have been transferred to the new owner. You are hereby notified that, from and after the date hereof and until further notice, all future payments under your lease should be made payable to [**COMMUNITY NAME**] and mailed to [**COMMUNITY LEASING OFFICE ADDRESS**]. In addition, all questions or other matters regarding your lease should be directed to the property manager at [**COMMUNITY LEASING OFFICE PHONE NUMBER**].