PURCHASE AND SALE CONTRACT

Exhibit 10.21

 

 

 

 

PURCHASE AND SALE CONTRACT

 

BETWEEN

 

 

 

THE TRAILS, L.P.,

 

a South Carolina limited partnership

 

 

 

 

 

AS SELLER

 

 

 

 

AND

 

 

 

 

FREEMAN WEBB INVESTMENTS, INC.,

 

a Tennessee corporation

 

 

 

AS PURCHASER

 

 

THE TRAILS APARTMENTS

 

 

Article I........... DEFINED TERMS............................................................................................ 1

Article II.......... PURCHASE AND SALE, PURCHASE PRICE & DEPOSIT.......................... 1

2.1...... Purchase and Sale.................................................................................................... 1

2.2...... Purchase Price and Deposit...................................................................................... 1

2.3...... Escrow Provisions Regarding Deposit....................................................................... 2

Article III........ FEASIBILITY PERIOD.................................................................................... 3

3.1...... Feasibility Period...................................................................................................... 3

3.2...... Expiration of Feasibility Period.................................................................................. 3

3.3...... Conduct of Investigation........................................................................................... 4

3.4...... Purchaser Indemnification......................................................................................... 4

3.5...... Property Materials.................................................................................................... 5

3.6...... Property Contracts................................................................................................... 6

Article IV........ TITLE................................................................................................................ 6

4.1...... Title Documents....................................................................................................... 6

4.2...... Survey..................................................................................................................... 7

4.3...... Objection and Response Process.............................................................................. 7

4.4...... Permitted Exceptions................................................................................................ 7

4.5...... Assumed Encumbrances........................................................................................... 8

4.6...... Subsequently Disclosed Exceptions......................................................................... 10

4.7...... Purchaser Financing................................................................................................ 10

4.8...... Regulatory Agreement............................................................................................ 11

Article V......... CLOSING....................................................................................................... 12

5.1...... Closing Date.......................................................................................................... 12

5.2...... Seller Closing Deliveries......................................................................................... 13

5.3...... Purchaser Closing Deliveries................................................................................... 14

5.4...... Closing Prorations and Adjustments........................................................................ 14

5.5...... Post Closing Adjustments....................................................................................... 18

Article VI........ REPRESENTATIONS AND WARRANTIES OF SELLER AND PURCHASER            18

6.1...... Seller's Representations.......................................................................................... 18

6.2...... AS-IS.................................................................................................................... 19

6.3...... Survival of Seller's Representations......................................................................... 20

6.4...... Definition of Seller's Knowledge............................................................................. 20

6.5...... Representations and Warranties of Purchaser.......................................................... 20

Article VII....... OPERATION OF THE PROPERTY.............................................................. 22

7.1...... Leases and Property Contracts............................................................................... 22

7.2...... General Operation of Property................................................................................ 22

7.3...... Liens...................................................................................................................... 22

Article VIII...... CONDITIONS PRECEDENT TO CLOSING................................................ 22

8.1...... Purchaser's Conditions to Closing........................................................................... 22

8.2...... Seller's Conditions to Closing.................................................................................. 23

Article IX........ BROKERAGE................................................................................................ 24

9.1...... Indemnity............................................................................................................... 24

9.2...... Broker Commission................................................................................................ 24

Article X......... DEFAULTS AND REMEDIES....................................................................... 24

10.1.... Purchaser Default................................................................................................... 24

10.2.... Seller Default.......................................................................................................... 25

Article XI........ RISK OF LOSS OR CASUALTY.................................................................. 26

11.1.... Major Damage....................................................................................................... 26

11.2.... Minor Damage....................................................................................................... 26

11.3.... Closing................................................................................................................... 26

11.4.... Repairs.................................................................................................................. 27

Article XII....... EMINENT DOMAIN..................................................................................... 27

12.1.... Eminent Domain..................................................................................................... 27

Article XIII...... MISCELLANEOUS....................................................................................... 27

13.1.... Binding Effect of Contract....................................................................................... 27

13.2.... Exhibits and Schedules........................................................................................... 27

13.3.... Assignability........................................................................................................... 28

13.4.... Captions................................................................................................................ 28

13.5.... Number and Gender of Words............................................................................... 28

13.6.... Notices.................................................................................................................. 28

13.7.... Governing Law and Venue..................................................................................... 30

13.8.... Entire Agreement.................................................................................................... 30

13.9.... Amendments.......................................................................................................... 31

13.10.. Severability............................................................................................................ 31

13.11.. Multiple Counterparts/Facsimile Signatures............................................................. 31

13.12.. Construction........................................................................................................... 31

13.13.. Confidentiality........................................................................................................ 31

13.14.. Time of the Essence................................................................................................ 31

13.15.. Waiver................................................................................................................... 32

13.16.. Attorneys' Fees...................................................................................................... 32

13.17.. Time Zone/Time Periods......................................................................................... 32

13.18.. 1031 Exchange...................................................................................................... 32

13.19.. No Personal Liability of Officers, Trustees or Directors of Seller's Partners.............. 32

13.20.. No Exclusive Negotiations...................................................................................... 32

13.21.. ADA Disclosure..................................................................................................... 33

13.22.. No Recording........................................................................................................ 33

13.23.. Relationship of Parties............................................................................................ 33

13.24.. Dispute Resolution.................................................................................................. 33

13.25.. AIMCO Marks...................................................................................................... 34

13.26.. Non-Solicitation of Employees................................................................................ 34

13.27.. Survival.................................................................................................................. 34

13.28.. Multiple Purchasers................................................................................................ 34

Article XIV..... LEAD BASED PAINT DISCLOSURE........................................................... 34

14.1.... Disclosure.............................................................................................................. 34

PURCHASE AND SALE CONTRACT

 

THIS PURCHASE AND SALE CONTRACT (this " Contract ") is entered into as of the 2 ^nd day of April, 2009 (the " Effective Date "), by and between THE TRAILS, L.P. , a South Carolina limited partnership, having an address at 4582 South Ulster Street Parkway, Suite 1100, Denver, Colorado 80237 (" Seller "), and FREEMAN WEBB INVESTMENTS, INC. , a Tennessee corporation, having a principal address at 555 Great Circle Road, Suite 100, Nashville, Tennessee 37228 (" Purchaser ").

NOW, THEREFORE, in consideration of mutual covenants set forth herein, Seller and Purchaser hereby agree as follows:

RECITALS

A.        Seller owns the real estate located in Davidson County, Tennessee, as more particularly described in Exhibit A attached hereto and made a part hereof, and the improvements thereon, commonly known as The Trails Apartments.

B.         Purchaser desires to purchase, and Seller desires to sell, such land, improvements and certain associated property, on the terms and conditions set forth below.

Article I
DEFINED TERMS

Unless otherwise defined herein, any term with its initial letter capitalized in this Contract shall have the meaning set forth in Schedule 1 attached hereto and made a part hereof.

Article II
PURCHASE AND SALE, PURCHASE PRICE & DEPOSIT

2.1               Purchase and Sale .  Seller agrees to sell and convey the Property to Purchaser and Purchaser agrees to purchase the Property from Seller, all in accordance with the terms and conditions set forth in this Contract.

2.2               Purchase Price and Deposit .  The total purchase price (" Purchase Price ") for the Property shall be an amount equal to $12,300,000.00 payable by Purchaser, as follows:

2.2.1         Within 2 Business Days following the Effective Date, Purchaser shall deliver to Fidelity National Title Insurance Company, 8450 East Crescent Parkway, Suite 410, Greenwood Village, Colorado 80111, c/o: Valena Bloomquist, Phone: (303) 244-9198, Fax: (720) 489-7593, Email: valena.bloomquist@fnf.com (" Escrow Agent " or " Title Insurer ") an initial deposit (the " Initial Deposit ") of $123,000.00 by wire transfer of immediately available funds (" Good Funds "). 

2.2.2         Within 2 Business Days following the day that the Feasibility Period expires, Purchaser shall deliver to Escrow Agent an additional deposit (the " Additional Deposit ") of $123,000.00 by wire transfer of Good Funds. 

2.2.3         At the Closing, subject to the occurrence of the Loan Assumption and Release, Purchaser shall receive a credit against the Purchase Price in the amount of the outstanding principal balance of the Note, together with all accrued but unpaid interest (if any) thereon, as of the Closing Date (the " Loan Balance ").

2.2.4         The balance of the Purchase Price for the Property shall be paid to and received by Escrow Agent by wire transfer of Good Funds no later than 12:00 noon on the Closing Date.

2.3               Escrow Provisions Regarding Deposit . 

2.3.1         Escrow Agent shall hold the Deposit and make delivery of the Deposit to the party entitled thereto under the terms of this Contract.  Escrow Agent shall invest the Deposit in such short-term, high-grade securities, interest-bearing bank accounts, money market funds or accounts, bank certificates of deposit or bank repurchase contracts as Escrow Agent, in its discretion, deems suitable, and all interest and income thereon shall become part of the Deposit and shall be remitted to the party entitled to the Deposit pursuant to this Contract.

2.3.2         Escrow Agent shall hold the Deposit until the earlier occurrence of (i) the Closing Date, at which time the Deposit shall be applied against the Purchase Price, or released to Seller pursuant to Section 10.1 , or (ii) the date on which Escrow Agent shall be authorized to disburse the Deposit as set forth in Section 2.3.3 .  The tax identification numbers of the parties shall be furnished to Escrow Agent upon request.

2.3.3         If prior to the Closing Date either party makes a written demand upon Escrow Agent for payment of the Deposit, Escrow Agent shall give written notice to the other party of such demand.  If Escrow Agent does not receive a written objection from the other party to the proposed payment within 5 Business Days after the giving of such notice, Escrow Agent is hereby authorized to make such payment.  If Escrow Agent does receive such written objection within such 5-Business Day period, Escrow Agent shall continue to hold such amount until otherwise directed by written instructions from the parties to this Contract or a final judgment or arbitrator's decision.  However, Escrow Agent shall have the right at any time to deposit the Deposit and interest thereon, if any, with a court of competent jurisdiction in the state in which the Property is located.  Escrow Agent shall give written notice of such deposit to Seller and Purchaser.  Upon such deposit, Escrow Agent shall be relieved and discharged of all further obligations and responsibilities hereunder.  Any return of the Deposit to Purchaser provided for in this Contract shall be subject to Purchaser's obligations set forth in Section 3.5.2 . 

2.3.4         The parties acknowledge that Escrow Agent is acting solely as a stakeholder at their request and for their convenience, and that Escrow Agent shall not be deemed to be the agent of either of the parties for any act or omission on its part unless taken or suffered in bad faith in willful disregard of this Contract or involving gross negligence.  Seller and Purchaser jointly and severally shall indemnify and hold Escrow Agent harmless from and against all costs, claims and expenses, including reasonable attorney's fees, incurred in connection with the performance of Escrow Agent's duties hereunder, except with respect to actions or omissions taken or suffered by Escrow Agent in bad faith, in willful disregard of this Contract or involving gross negligence on the part of the Escrow Agent.

2.3.5         The parties shall deliver to Escrow Agent an executed copy of this Contract.  Escrow Agent shall execute the signature page for Escrow Agent attached hereto which shall confirm Escrow Agent's agreement to comply with the terms of Seller's closing instruction letter delivered at Closing and the provisions of this Section 2.3 .

2.3.6         Escrow Agent, as the person responsible for closing the transaction within the meaning of Section 6045(e)(2)(A) of the Internal Revenue Code of 1986, as amended (the " Code "), shall file all necessary information, reports, returns, and statements regarding the transaction required by the Code including, but not limited to, the tax reports required pursuant to Section 6045 of the Code.  Further, Escrow Agent agrees to indemnify and hold Purchaser, Seller, and their respective attorneys and brokers harmless from and against any Losses resulting from Escrow Agent's failure to file the reports Escrow Agent is required to file pursuant to this section.

Article III
FEASIBILITY PERIOD

3.1               Feasibility Period .  Subject to the terms of Sections 3.3 and 3.4 and the rights of Tenants under the Leases, from the Effective Date to and including the date which is 45 days after the Effective Date (the " Feasibility Period "), Purchaser, and its agents, contractors, engineers, surveyors, attorneys, and employees (collectively, " Consultants ") shall, at no cost or expense to Seller, have the right from time to time to enter onto the Property to conduct and make any and all customary studies, tests, examinations, inquiries, inspections and investigations of or concerning the Property, review the Materials and otherwise confirm any and all matters which Purchaser may reasonably desire to confirm with respect to the Property and Purchaser's intended use thereof (collectively, the " Inspections "). 

3.2               Expiration of Feasibility Period .  If any of the matters in Section 3.1 or any other title or survey matters are unsatisfactory to Purchaser for any reason, or for no reason whatsoever, in Purchaser's sole and absolute discretion, or if for any other reason, or for no reason whatsoever Purchaser, in its sole discretion, determines not to purchase the Property, then Purchaser shall have the right to terminate this Contract by giving written notice to that effect to Seller and Escrow Agent no later than 5:00 p.m. on or before the date of expiration of the Feasibility Period.  If Purchaser provides such notice, this Contract shall terminate and be of no further force and effect subject to and except for the Survival Provisions, and Escrow Agent shall return the Initial Deposit to Purchaser.  If Purchaser fails to provide Seller with written notice of termination prior to the expiration of the Feasibility Period, Purchaser's right to terminate under this Section 3.2 shall be permanently waived and this Contract shall remain in full force and effect, the Deposit shall be non-refundable, except as otherwise expressly provided herein and Purchaser's obligation to purchase the Property shall be conditional only as provided in Section  8.1 .

3.3               Conduct of Investigation .  Purchaser shall not permit any mechanics' or materialmen's liens or any other liens to attach to the Property by reason of the performance of any work or the purchase of any materials by Purchaser or any other party in connection with any Inspections conducted by or for Purchaser.  Purchaser shall give reasonable advance notice to Seller prior to any entry onto the Property and shall permit Seller to have a representative present during all Inspections conducted at the Property.  Purchaser shall take all reasonable actions and implement all protections necessary to ensure that all actions taken in connection with the Inspections, and all equipment, materials and substances generated, used or brought onto the Property pose no material threat to the safety of persons, property or the environment.

3.4               Purchaser Indemnification . 

3.4.1         Purchaser shall indemnify, hold harmless and, if requested by Seller (in Seller's sole discretion), defend (with counsel approved by Seller) Seller, together with Seller's affiliates, parent and subsidiary entities, successors, assigns, partners, managers, members, employees, officers, directors, trustees, shareholders, counsel, representatives, agents, Property Manager, Regional Property Manager, and AIMCO (collectively, including Seller, " Seller's Indemnified Parties "), from and against any and all damages, mechanics' liens, materialmen's liens, liabilities, penalties, interest, losses, demands, actions, causes of action, claims, costs and expenses (including reasonable attorneys' fees, including the cost of in-house counsel and appeals) (collectively, " Losses ") arising from or related to Purchaser's or its Consultants' entry onto the Property, and any Inspections or other acts by Purchaser or Purchaser's Consultants with respect to the Property during the Feasibility Period or otherwise.

3.4.2         Notwithstanding anything in this Contract to the contrary, Purchaser shall not be permitted to perform any invasive tests on the Property without Seller's prior written consent, which consent may be withheld in Seller's sole discretion.  Further, Seller shall have the right, without limitation, to disapprove any and all entries, surveys, tests (including, without limitation, a Phase II environmental study of the Property), investigations and other matters that in Seller's reasonable judgment could result in any injury to the Property or breach of any contract, or expose Seller to any Losses or violation of applicable law, or otherwise adversely affect the Property or Seller's interest therein.  Purchaser shall use reasonable efforts to minimize disruption to Tenants in connection with Purchaser's or its Consultants' activities pursuant to this Section.  No consent by Seller to any such activity shall be deemed to constitute a waiver by Seller or assumption of liability or risk by Seller.  Purchaser hereby agrees to restore, at Purchaser's sole cost and expense, the Property to the same condition existing immediately prior to Purchaser's exercise of its rights pursuant to this Article III .  Purchaser shall maintain and cause its third party consultants to maintain (a) casualty insurance and commercial general liability insurance with coverages of not less than $1,000,000.00 for injury or death to any one person and $3,000,000.00 for injury or death to more than one person and $1,000,000.00 with respect to property damage, and (b) worker's compensation insurance for all of their respective employees in accordance with the law of the state in which the Property is located.  Purchaser shall deliver proof of the insurance coverage required pursuant to this Section 3.4.2 to Seller (in the form of a certificate of insurance) at least two (2) Business Days prior to Purchaser's or Purchaser's Consultants' entry onto the Property.

3.5               Property Materials . 

3.5.1         Within 5 Business Days after the Effective Date, and to the extent the same exist and are in Seller's possession or reasonable control (subject to Section  3.5.2 ), Seller agrees to make the documents set forth on Schedule 3.5 (together with any other documents or information provided by Seller or its agents to Purchaser with respect to the Property, the " Materials ") available at the Property for review and copying by Purchaser at Purchaser's sole cost and expense.  In the alternative, at Seller's option and within the foregoing time period, Seller may deliver some or all of the Materials to Purchaser, or make the same available to Purchaser on a secure web site (Purchaser agrees that any item to be delivered by Seller under this Contract shall be deemed delivered to the extent available to Purchaser on such secured web site).  To the extent that Purchaser determines that any of the Materials have not been made available or delivered to Purchaser pursuant to this Section 3.5.1 , Purchaser shall notify Seller and Seller shall use commercially reasonable efforts to deliver the same to Purchaser within 5 Business Days after such notification is received by Seller; provided, however, that under no circumstances will the Feasibility Period be extended and Purchaser's sole remedy will be to terminate this Contract pursuant to Section 3.2 .

3.5.2         In providing the Materials to Purchaser, other than Seller's Representations, Seller makes no representation or warranty, express, written, oral, statutory, or implied, and all such representations and warranties are hereby expressly excluded and disclaimed.  All Materials are provided for informational purposes only and, together with all Third-Party Reports, shall be returned by Purchaser to Seller (or the destruction thereof shall be certified in writing by Purchaser to Seller) as a condition to return of the Deposit to Purchaser if this Contract is terminated for any reason.  Recognizing that the Materials delivered or made available by Seller pursuant to this Contract may not be complete or constitute all of such documents which are in Seller's possession or control, but are those that are readily and reasonably available to Seller, Purchaser shall not in any way be entitled to rely upon the completeness or accuracy of the Materials and will instead in all instances rely exclusively on its own Inspections and Consultants with respect to all matters which it deems relevant to its decision to acquire, own and operate the Property.

3.5.3         In addition to the items set forth on Schedule 3.5 , no later than 5 Business Days after the Effective Date, Seller shall deliver to Purchaser (or otherwise make available to Purchaser as provided under Section 3.5.1 ) the most recent rent roll for the Property listing the move-in date, monthly base rent payable, lease expiration date and unapplied security deposit for each Lease (the " Rent Roll ").  Seller makes no representations or warranties regarding the Rent Roll other than the express representation set forth in Section 6.1.6 .  

3.5.4         In addition to the items set forth on Schedule 3.5 , no later than 5 Business Days after the Effective Date, Seller shall deliver to Purchaser (or otherwise make available to Purchaser as provided under Section 3.5.1 ) a list of all current Property Contracts (the " Property Contracts List ").  Seller makes no representations or warranties regarding the Property Contracts List other than the express representations set forth in Section 6.1.7 . 

3.6               Property Contracts .  On or before the expiration of the Feasibility Period, Purchaser may deliver written notice to Seller (the " Property Contracts Notice ") specifying any Property Contracts which Purchaser desires to terminate at the Closing (the " Terminated Contracts "); provided that (a) the effective date of such termination on or after Closing shall be subject to the express terms of such Terminated Contracts, (b) if any such Property Contract cannot by its terms be terminated at Closing, it shall be assumed by Purchaser and not be a Terminated Contract, and (c) to the extent that any such Terminated Contract requires payment of a penalty, premium, or damages, including liquidated damages, for cancellation, Purchaser shall be solely responsible for the payment of any such cancellation fees, penalties, or damages, including liquidated damages.  If Purchaser fails to deliver the Property Contracts Notice on or before the expiration of the Feasibility Period, there shall be no Terminated Contracts and Purchaser shall assume all Property Contracts at the Closing.  If Purchaser delivers the Property Contracts Notice to Seller on or before the expiration of the Feasibility Period, then simultaneously therewith, Purchaser shall deliver to Seller a vendor termination notice (in the form attached hereto as Exhibit F ) for each Terminated Contract informing the vendor(s) of the termination of such Terminated Contract as of the Closing Date (subject to any delay in the effectiveness of such termination pursuant to the express terms of each applicable Terminated Contract) (the " Vendor Terminations ").  Seller shall sign the Vendor Terminations prepared by Purchaser, and deliver them to all applicable vendors.  To the extent that any Property Contract to be assigned to Purchaser requires vendor consent, then, prior to the Closing, Purchaser may attempt to obtain from each applicable vendor a consent (each a " Required Assignment Consent ") to such assignment.  Purchaser shall indemnify, hold harmless and, if requested by Seller (in Seller's sole discretion), defend (with counsel approved by Seller) Seller's Indemnified Parties from and against any and all Losses arising from or related to Purchaser's failure to obtain any Required Assignment Consent.

Article IV
TITLE

4.1               Title Documents .  Within 10 days after the Effective Date, Seller shall cause to be delivered to Purchaser a standard form commitment or preliminary title report (" Title Commitment ") to provide an American Land Title Association owner's title insurance policy for the Property, using the current policy jacket customarily provided by the Title Insurer, in an amount equal to the Purchase Price (the " Title Policy "), together with copies of all instruments identified as exceptions therein (together with the Title Commitment, referred to herein as the " Title Documents ").  Seller shall be responsible only for payment of the basic premium for the Title Policy and the costs of issuance of the Title Commitment, if any.  Purchaser shall be solely responsible for payment of all other costs relating to procurement of the Title Commitment, the Title Policy, and any requested endorsements.

4.2               Survey .  Subject to Section 3.5.2 , within 3 Business Days after the Effective Date, Seller shall deliver to Purchaser or make available at the Property any existing survey of the Property (the " Existing Survey ").  Purchaser may, at its sole cost and expense, order a new or updated survey of the Property either before or after the Effective Date (such new or updated survey together with the Existing Survey, is referred to herein as the " Survey "). 

4.3               Objection and Response Process .  On or before the date which is 20 days after the Effective Date (the " Objection Deadline "), Purchaser shall give written notice (the " Objection Notice ") to the attorneys for Seller of any matter set forth in the Title Documents and the Survey to which Purchaser objects (the " Objections ").  If Purchaser fails to tender an Objection Notice on or before the Objection Deadline, Purchaser shall be deemed to have approved and irrevocably waived any objections to any matters covered by the Title Documents and the Survey.  On or before 25 days after the Effective Date (the " Response Deadline "), Seller may, in Seller's sole discretion, give Purchaser notice (the " Response Notice ") of those Objections which Seller is willing to cure, if any.  Seller shall be entitled to reasonable adjournments of the Closing Date to cure the Objections.  If Seller fails to deliver a Response Notice by the Response Deadline, Seller shall be deemed to have elected not to cure or otherwise resolve any matter set forth in the Objection Notice.  If Purchaser is dissatisfied with the Response Notice or the lack of Response Notice, Purchaser may, as its exclusive remedy, exercise its right to terminate this Contract prior to the expiration of the Feasibility Period in accordance with the provisions of Section 3.2.  If Purchaser fails to timely exercise such right, Purchaser shall be deemed to accept the Title Documents and Survey with resolution, if any, of the Objections set forth in the Response Notice (or if no Response Notice is tendered, without any resolution of the Objections) and without any reduction or abatement of the Purchase Price. 

4.4               Permitted Exceptions .  The Deed delivered pursuant to this Contract shall be subject to the following, all of which shall be deemed " Permitted Exceptions ":

4.4.1         All matters shown in the Title Documents and the Survey, other than (a) those Objections, if any, which Seller has agreed to cure pursuant to the Response Notice under Section 4.3 , (b) mechanics' liens and taxes due and payable with respect to the period preceding Closing, (c) the standard exception regarding the rights of parties in possession, which shall be limited to those parties in possession pursuant to the Leases, and (d) the standard exception pertaining to taxes, which shall be limited to taxes and assessments payable in the year in which the Closing occurs and subsequent taxes and assessments;

4.4.2         All Leases;

4.4.3         The Assumed Encumbrances;

4.4.4         Applicable zoning and governmental regulations and ordinances;

4.4.5         Any defects in or objections to title to the Property, or title exceptions or encumbrances, arising by, through or under Purchaser;

4.4.6         The LURA; and

4.4.7         The terms and conditions of this Contract.

4.5               Assumed Encumbrances .

4.5.1         Purchaser recognizes and agrees that, in connection with a loan (the " Loan ") made to Seller by Johnson Capital Group, Inc. (the " Lender "), the Property presently is encumbered by a deed of trust dated May 31, 2006 and recorded June 6, 2006 in instrument number 20060606-0067085, as assigned to Federal Home Loan Mortgage Corporation in instrument number 20060606-0067087 (the " Assumed Deed of Trust ") and certain other security and related documents in connection with the Loan (collectively, the " Assumed Encumbrances ").  The Loan is evidenced by that certain promissory note dated May 31, 2006 in the stated principal amount of $8,700,000.00 (the " Note, " and together with the Assumed Deed of Trust, the Assumed Encumbrances and any other documents executed by Seller in connection with the Loan, the " Assumed Loan Documents "), executed by Seller and payable to the order of the Lender.  Within 10 days after the Effective Date, Seller agrees that it will make available to Purchaser (in the same manner in which Seller is permitted to make the Materials available to Purchaser under Section 3.5.1 ) copies of the Assumed Loan Documents which are in Seller's possession or reasonable control (subject to Section 3.5.2 ).

4.5.2         Purchaser agrees that, at the Closing, (a) Purchaser shall assume Seller's obligations under the Note and all of the other Assumed Loan Documents and accept title to the Property subject to the Deed of Trust and the Assumed Encumbrances, and (b) the Lender shall release Seller, as well as any guarantors and other obligated parties under the Assumed Loan Documents, from all obligations under the Assumed Loan Documents (and any related guarantees or letters of credit), including, without limitation, any obligation to make payments of principal and interest under the Note (collectively, the foregoing (a) and (b) referred to herein as the " Loan Assumption and Release ").  Purchaser acknowledges and agrees that (x) certain of the provisions of the Assumed Loan Documents may have been negotiated for the exclusive benefit of Seller, AIMCO or their respective affiliates (the " Specific AIMCO Provisions "), and (y) unless Lender otherwise agrees in Lender's sole and arbitrary discretion, Purchaser will not be permitted to assume the benefit of the Specific AIMCO Provisions and the same shall be of no further force or effect from and after the Closing Date.

4.5.3         Purchaser further acknowledges that the Assumed Loan Documents require the satisfaction by Purchaser of certain requirements as set forth therein to allow for the Loan Assumption and Release.  Accordingly, in the event that Purchaser has not previously terminated this Contract under Section 3.2, Purchaser, at its sole cost and expense and within 30 days after the Effective Date (the " Loan Assumption Application Submittal Deadline "), shall submit an application to Lender for assumption of the Loan together with all documents and information required in connection therewith (the " Loan Assumption Application ").  Purchaser agrees to provide Seller with a copy of the Loan Assumption Application and shall provide evidence of its submission to Lender on or before the Loan Assumption Application Submittal Deadline.  Purchaser acknowledges and agrees that Purchaser is solely responsible for the preparation and submittal of the Loan Assumption Application, including the collection of all materials, documents, certificates, financials, signatures, and other items required to be submitted to Lender in connection with the Loan Assumption Application. 

4.5.4         [Intentionally deleted] .

4.5.5         Purchaser shall pay all fees and expenses (including, without limitation, all servicing fees and charges, transfer fees, assumption fees, title fees, endorsement fees, and other fees to release Seller of all liability under the Loan) imposed or charged by the Lender or its counsel (such fees and expenses collectively being referred to as the " Lender Fees "), in connection with the Loan Assumption Application and the Loan Assumption and Release.   

4.5.6         Additionally, Purchaser at the Closing shall be responsible for (a) replacing (and increasing to the extent required by Lender) all reserves, impounds and other accounts required to be maintained in connection with the Loan, and (b) funding any additional reserves, impounds or accounts required by Lender to be maintained by Purchaser in connection with the Loan after the Loan Assumption and Release (the foregoing amounts in (a) and (b) collectively referred to herein as the " Required Loan Fund Amounts ").  Any existing reserves, impounds and other accounts required to be replaced by Purchaser pursuant to the foregoing sentence shall be released in Good Funds to Seller at the Closing or as otherwise agreed between Lender and Seller. 

4.5.7         Purchaser agrees promptly to deliver to the Lender all documents and information required by the Assumed Loan Documents, and such other information or documentation as the Lender reasonably may request, including, without limitation, financial statements, income tax returns and other financial information for Purchaser and any required guarantor.  Seller agrees that it will cooperate with Purchaser and Lender, at no cost or expense to Seller, in connection with Purchaser's application to Lender for approval of the Loan Assumption and Release. 

4.5.8         [Intentionally deleted ] .

4.5.9         Purchaser shall be in default hereunder if Purchaser fails to submit a Loan Assumption Application by the Loan Assumption Application Submittal Deadline, in which event Seller may terminate this Contract and the Deposit shall be immediately released by the Escrow Agent to Seller.

4.5.10     Provided that (a) Purchaser fully complies with its obligations to file the Loan Assumption Application by the Loan Assumption Application Submittal Deadline under this Contract and (b) Purchaser does not obtain the consent of the Lender to the Loan Assumption and Release under terms and conditions satisfactory to Purchaser in its sole discretion within 60 days after the Effective Date (the “ Loan Approval Period ”), then Purchaser shall have the right to give Escrow Agent notice terminating this Contract on or before the expiration of the Loan Approval Period, in which event this Contract shall be of no further force and effect, subject to and except for Purchaser’s liability pursuant to Section 3.4 and any other provision of this Contract which survives such termination, and Escrow Agent shall forthwith return the Deposit to Purchaser.  If Purchaser fails to provide Seller with written notice of termination prior to the expiration of the Loan Approval Period in strict accordance with the notice provisions of this Contract, Purchaser’s right to terminate under this Section 4.5.10 shall be permanently waived, this Contract shall remain in full force and effect, the Deposit shall be non-refundable, except as otherwise expressly provided herein, and Purchaser’s obligation to obtain the Lender’s approval of the Loan Assumption and Release and to purchase the Property shall be non-contingent and unconditional except only for satisfaction of the conditions expressly stated in Section 8.1 .  Purchaser recognizes and agrees that if the Loan Approval Period expires and Purchaser does not terminate this Contract, the Loan Assumption and Release shall not be a condition to Purchaser’s obligation to close, and, if the Loan Assumption and Release is not obtained and the Closing has not occurred on or before the Closing Date for that reason, Purchaser shall be in default under this Contract, entitling the Seller to terminate this Contract, in which event the Deposit shall be immediately released to Seller by the Escrow Agent and this Contract shall be of no further force and effect, subject to and except for Purchaser’s liability pursuant to Section  3.4 and any other provision of this Contract which survives such termination.

4.6               Subsequently Disclosed Exceptions .  If at any time after delivery of the Title Commitment, any update to the Title Commitment discloses any additional item that materially adversely affects title to the Property which was not disclosed on any version of or update to the Title Commitment delivered to Purchaser during the Feasibility Period (the " New Exception "), Purchaser shall have a period of 5 days from the date of its receipt of such update (the " New Exception Review Period ") to review and notify Seller in writing of Purchaser's approval or disapproval of the New Exception.  If Purchaser disapproves of the New Exception, Seller may, in Seller's sole discretion, notify Purchaser as to whether it is willing to cure the New Exception.  If Seller elects to cure the New Exception, Seller shall be entitled to reasonable adjournments of the Closing Date to cure the New Exception.  If Seller fails to deliver a notice to Purchaser within 3 days after the expiration of the New Exception Review Period, Seller shall be deemed to have elected not to cure the New Exception.  If Purchaser is dissatisfied with Seller's response, or lack thereof, Purchaser may, as its exclusive remedy elect either:  (i) to terminate this Contract, in which event the Deposit shall be promptly returned to Purchaser or (ii) to waive the New Exception and proceed with the transactions contemplated by this Contract, in which event Purchaser shall be deemed to have approved the New Exception.  If Purchaser fails to notify Seller of its election to terminate this Contract in accordance with the foregoing sentence within 6 days after the expiration of the New Exception Review Period, Purchaser shall be deemed to have elected to approve and irrevocably waive any objections to the New Exception. 

4.7               Purchaser Financing .  Purchaser assumes full responsibility to obtain the funds required for settlement, and Purchaser's acquisition of such funds shall not be a contingency to the Closing.

4.8               Regulatory Agreement .  Purchaser recognizes and agrees that (i) the Property is subject to that certain Declaration of Land Use Restrictions, dated as of December 1, 1984, of record in Book 6461, Page 409, by Trails of Nashville Associates, LTD, a Tennessee limited partnership, for the benefit of The Industrial Development Board of the Metropolitan Government of Nashville and Davidson County (" Issuer ") relating to bonds previously purchased by Capital Holding Corporation (“ Bond Purchaser ”) (as may be amended, the " LURA ").  The LURA shall be deemed a Permitted Exception for all purposes hereunder.

4.8.1         At the Closing, Purchaser shall assume in writing all obligations under the LURA arising on or after the Closing Date in accordance with the terms thereof and accept title to the Property subject to the same (" LURA Assumption ").  In the event the LURA Assumption does not provide for a release of Seller from the obligations under the LURA, Purchaser shall provide Seller with a written indemnity at Closing for any breach of the obligations and covenants under the LURA arising after the Closing Date in form acceptable to Seller.

4.8.2         No later than 30 days after the Effective Date (the " LURA Submittal Deadline "), Purchaser, at its sole cost and expense, shall submit all applications, documents, information, materials and fees to Issuer and Bond Purchaser (collectively, the " LURA Assumption Applications ") required by Issuer and Bond Purchaser in order for Issuer and Bond Purchaser to review and approve Purchaser's request for the LURA Assumption (individually a " LURA Approval " and collectively the " LURA Approval ").  The terms and conditions in connection with the LURA Approval which impose additional obligations on Seller are subject to Seller’s reasonable approval.

4.8.3         Purchaser agrees to provide Seller with a copy of the LURA Assumption Applications and shall provide evidence of its submission to Issuer and Bond Purchaser on or before the LURA Submittal Deadline.  Purchaser acknowledges and agrees that Purchaser is solely responsible for the preparation and submittal of the LURA Assumption Applications, including the collection of all materials, documents, certificates, financials, signatures, and other items required to be submitted to Issuer and Bond Purchaser in connection therewith.

4.8.4         [Intentionally deleted].

4.8.5         All fees and expenses (including, without limitation, all charges, transfer fees, assumption fees (including documentary stamp and non-recurring intangible taxes), title fees, endorsement fees, legal fees and other fees) imposed or charged by Issuer or Bond Purchaser or their counsel (such fees and expenses collectively being referred to as the " LURA Assumption Fees "), in connection with the LURA Assumption Applications and the LURA Assumption and any bond counsel opinions required in connection therewith, if any, shall be paid for solely by Purchaser.  The provisions of this Section 4.8.5 shall survive the termination of this Contract and the Closing. 

4.8.6         Purchaser agrees to deliver to Issuer and Bond Purchaser such other information or documentation as Issuer or Bond Purchaser reasonably may request, including, without limitation, financial statements, income tax returns and other financial information for Purchaser and any required guarantor.  Seller agrees that it will cooperate with Purchaser and Issuer and Bond Purchaser, at no material cost or expense to Seller, in connection with Purchaser's application to Issuer and Bond Purchaser for approval of the LURA Assumption.  Seller will provide the necessary contact information for Issuer and the Bond Purchaser and will authorize Purchaser to contact Issuer and the Bond Purchaser directly for purposes of processing the LURA Assumption.

4.8.7         Purchaser shall be in default hereunder if Purchaser fails to submit the LURA Assumption Applications by the LURA Submittal Deadline, in which event this Contract shall terminate, at the option of Seller, and Seller shall be entitled to retain the Deposit and this Contract shall be of no further force and effect subject to and except for the Survival Provisions.

4.8.8         Provided that (a) Purchaser fully complies with its obligations to file the LURA Assumption Applications by the LURA Submittal Deadline under this Contract, and (b) Purchaser does not obtain the consent of the Issuer and the Bond Purchaser to the LURA Approval under the terms and conditions satisfactory to Purchaser in its sole discretion within 60 days after the Effective Date (the “ LURA Approval