AGREEMENT of PURCHASE and SALE Lender As BUYER and ______Limited Partnership As SELLER

[Exhibit 2]

AGREEMENT OF PURCHASE AND SALE
[Lender]
as
BUYER
and
[______Limited Partnership]
as
SELLER

TABLE OF CONTENTS

SectionsPage

1.Agreement to Buy and Sell.

2.Purchase Price.

3.No Merger.

4.InstrumentsofConveyance.

5.Tenant Leases and Security Deposits.

6.Operations Prior to Closing.

7.Closing Date and Possession.

8.Closing.

9.Fire or Other Casualty.

10.Representations and Warranties of Seller.

11.Representations and Warranties of Buyer.

12.Conditions to Closing.

13.No Outside Representations.

14.Notices.

15.Binding Effect and Third Party Beneficiaries.

16.Counterparts.

17.Choice of Law and Forum.

18.Waiver.

19.Seller’s 1031 Exchange.

LIST OF EXHIBITS:
Exhibit ALegal Description
Exhibit B Tenant Rent Roll
Exhibit C List of Contracts and Other Agreements

INCORPORATED PLAN EXHIBITS:
Exhibit 3Form of Deed
Exhibit 4Form of Transfer Instrument
Exhibit 5Form of Assumption of Mortgage Note

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AGREEMENT OF PURCHASE AND SALE

This Agreement of Purchase and Sale (this “Agreement”) is made as of ______k 200__, by and between ______Limited Partnership, a ______limited partnership, with an address of ______(“Seller”) and [Lender], a ______, and its successors and assigns, with an address of ______(“Buyer”).

The following is a recital of facts underlying this Agreement:

A.Seller is the owner of a residential apartment project consisting of certain improvements and related rights, located on land in the [City of _____, ______County, State of ______] described in the attached ExhibitA (the “Premises”), and is the owner of various personal property, tangible and intangible, which is used in connection with, belonging, appertaining or relating to the Premises (collectively with the Premises, the “Project”).

B.Seller filed a voluntary petition for bankruptcy protection under the Bankruptcy Code on ______, 20__ (Case No.______, U.S. Bankruptcy Court, ______District of ______, ______Division). The Debtor’s Amended and Restated Plan of Reorganization dated as of ______, 20__ (the “Plan”) was confirmed pursuant to the court’s Order Confirming Debtor’s Amended and Restated Plan of Reorganization ______, 20__ (the “Confirmation Order”) in that case.

C.As set forth in the Plan, Seller agrees to sell all of its right, title, estate and interest in and to the Project to Buyer upon the terms and conditions herein set forth; and Buyer agrees to buy the Project from Seller for the purchase price and on the terms and subject to the conditions herein set forth.

NOW, THEREFORE, for good and valuable consideration received to the full satisfaction of each of them, the parties agree as follows:

1.Agreement to Buy and Sell.

Seller agrees to sell and convey to Buyer, and Buyer agrees to buy and take from Seller, under the terms and conditions set forth below all of Seller’s right, title, estate and interest in and to the Project and all rights, privileges and appurtenances appertaining to the Project, including without limitation all of Seller’s right, title, estate and interest in and to any easements, licenses or other arrangements with respect to adjacent properties, including, without limitation, the following:

(a)All buildings and improvements located on or in the Project, all fixtures, plumbing, incinerators, lighting equipment, radiators, furnaces, boilers, hot water heaters, water systems and air conditioning equipment located thereon or therein or attached thereto, in their present “as is” condition;

(b)Such furnishings, furniture, equipment, supplies and other personal property located on or pertaining to the Project, in their present “as is” condition; (the “Personal Property”);

(c)All prepaid rentals, security deposits, leaseholds and leasehold improvements;

(d)All leases, written or oral and tenancies with tenants occupying any portion of the Project as more fully described in the rent roll attached hereto and made a part hereof as ExhibitB (the “Tenant Leases”);

(e)All other agreements, contracts and contract rights pertaining to the Project, as identified in ExhibitC attached hereto and made a part hereof, but excluding any agreements, contracts and contract rights with any affiliates of Seller (including but not limited to its partners and its management company) and this Agreement and related rights and agreements between Seller and Buyer (the “Property Contracts”).

All of the foregoing assets and properties to be acquired by Buyer are hereinafter collectively referred to as the “Property”.

2.Purchase Price.

The purchase price for the Property shall be the outstanding amount due under that certain [Lender] Note dated as of ______, 20__, now held by Buyer, in the original stated principal amount of $______(the “Indebtedness”), which shall be satisfied by the assumption of the Indebtedness by Buyer on the Closing Date (as hereinafter defined) pursuant to an Assumption of Mortgage Note in the form attached as Exhibit5 to the Plan and incorporated herein (the “Assumption”).

3.No Merger.

The Indebtedness is secured by a certain Mortgage dated as of ______, 20__ and recorded ______, 20__ in Liber ____, Page ______, ______County Records and a certain unrecorded Security Agreement dated as of ______, 20__ and now held by Buyer, all of which are referred to as the “Collateral Documents.” It is expressly understood and agreed by the parties that the execution, delivery, acceptance, filing and recording of the Conveyance Instruments (as defined below) and the conveyances made thereby, and the execution, delivery and acceptance of the Assumption, shall not in any manner be deemed to be nor shall they operate as: (i)a merger with or the extinguishment or discharge of the Collateral Documents and/or the Indebtedness and that the Collateral Documents and Indebtedness are and shall hereafter continuously remain at all times, in full force and effect according to the tenor thereof; nor (ii)a merger of the interests of Buyer under the Collateral Documents and as the owner of the Property; nor (iii)waiver by Buyer of its claim of priority under the Collateral Documents over any other liens, mortgages or encumbrances now existing or hereafter placed upon the Property; nor (iv)affect or prejudice in any way, the right of Buyer to foreclose, in equity or otherwise, the Collateral Documents (including, the Mortgage) or exercise any and all of its available rights and remedies; except that the Buyer shall be substituted for the Seller, and all rights and remedies against Seller pursuant the Collateral Documents shall be exercisable only against the Buyer in its capacity as owner of the Property. The Collateral Documents and the liens, mortgages and encumbrances imposed by the Collateral Documents shall, in all respects, survive the execution, delivery, acceptance, filing and recording of the Conveyance Instruments, this being the express intent of the Seller and Buyer and it being in the best interests of Buyer.

4.InstrumentsofConveyance.

The following fully executed documents (collectively the “Conveyance Instruments”) shall be executed by Seller and delivered to Buyer on the Closing Date:

(a)A deed, in the form attached to the Plan as Exhibit3 and made a part hereof (the “Deed”), conveying all of Seller’s right, title, estate and interest in and to the Property to Buyer; and

(b)A Transfer Instrument, in the form attached to the Plan as Exhibit4 and made a part hereof (the “Transfer Instrument”), conveying title to the Personal Property to Buyer and assigning the Tenant Leases and the Property Contracts (if any).

5.Tenant Leases and Security Deposits.

All of Seller’s right, title and interest as landlord in and to all Tenant Leases shall be assigned to and assumed by Buyer pursuant to the Transfer Instrument. All security deposits held by Seller shall be assigned to Buyer as set forth therein, and each applicable tenant shall be notified of the transfer and given Buyer’s name and address, pursuant to [applicable state statute].

6.Operations Prior to Closing.

From the date hereof to the Closing Date:

(a)Seller shall continue to operate the Project and incur expenses in accordance with the Rents Order (as defined in the Plan).

(b)Seller shall keep and perform all of the obligations to be performed by Seller under the Tenant Leases and Contracts and shall exercise its reasonable efforts to preserve intact the operations of the Property and to foster the continuance of beneficial relationships with lessees and suppliers.

7.Closing Date and Possession.

(a)Unless the parties otherwise agree in writing, this transaction shall be closed on such date as is mutually acceptable to the parties, but in any event no later than three (3) business days’ after Seller has assigned its rights (but not its obligations) to a qualified intermediary (the “Intermediary”), which assignment shall occur immediately after Seller receives a fully executed copy of this Agreement (“Closing Date”).

(b)On the Closing Date, the Conveyance Instruments shall be delivered to Buyer and the Deed and any other necessary documents shall be recorded; provided that all necessary deliveries have been made.

(c)Contemporaneously with the delivery of the Conveyance Instruments to Buyer, Seller shall deliver possession of the Project to Buyer.

8.Closing.

(a)Seller’s Deliveries. At Closing, and provided that Buyer simultaneously performs its obligations under Section8(b), Seller shall execute items (i) through (iv), and deliver all of the items listed below to Buyer:

(i)The Deed;

(ii)The Transfer Instrument;

(iii)Copies of each Tenant Lease and Contract;

(iv)All keys and other access devices to the Property;

(v)Any plans and specifications in Seller’s possession with respect to the Property; and

(vi)All cash (the “Cash”) held by Seller in its accounts pursuant to the Rents Order (as defined in the Plan), including the cash held in the Seller’s operating account (which includes the funds reserved for payment of taxes and insurance) and in the separate account in which tenant security deposits are held, less an amount sufficient to pay unpaid Operating Expenses that have accrued pre-Closing, as set forth below.

(b)Buyer’s Deliveries. At Closing, and provided that Seller simultaneously performs its obligations under Section8(a), Buyer shall execute items (i) through (iii) below and deliver all of the items listed below to Seller:

(i)The Deed;

(ii)The Transfer Instrument; and

(iii)The Assumption.

(c)Closing Expenses. Conveyance of the Property to Buyer is exempt from real property transfer taxes as set forth in the Plan and Confirmation Order. The costs of recording the Deed and any other documents to be recorded shall be borne by Buyer. The costs of effectuating the 1031 exchange set forth in Section19 below, including any fees of the Intermediary, shall be borne by Seller.

(d)Payment of Operating Expenses and Final Accounting.

(i)Seller shall estimate the expenses incurred in accordance with the Rents Order (as defined in the Plan) pre-Closing that have not been paid as of the Closing. Seller shall retain Cash in an amount sufficient to pay, and shall pay, such unpaid Operating Expenses, except to the extent that Seller and Buyer agree that any such expenses shall be paid by Buyer. Seller and Buyer hereby agree that out of the Cash delivered to Buyer, Buyer shall pay any utility charges that have accrued, but for which Seller has not received a bill before the Closing. Seller and Buyer also hereby agree that out of the cash delivered to Buyer, Buyer shall pay the outstanding property taxes[, except that Seller shall retain Cash to pay the $and $payments due on , 20 if the Closing and transfer of Cash to Buyer does not occur on or before , 20].

(ii)Seller shall provide an interim accounting of its use of the retained Cash and payment of the pre-Closing Operating Expenses (in substantially the same form as provided by Seller to Buyer in connection with the Rents Order) on or before the 20th of the month following the month in which the Closing occurs. Seller shall provide a final accounting on or before the 20th of the next following month.

(iii)After Seller has paid all of the pre-Closing Operating Expenses that are not being paid by Buyer, Seller shall promptly transfer any remaining Cash to Buyer. If Seller did not retain sufficient Cash to pay such expenses, Buyer shall promptly reimburse Seller for any such deficiency upon receipt of the final accounting.

9.Fire or Other Casualty.

If any buildings or improvements constituting a part of the Property shall, prior to the Closing Date, be damaged or destroyed by fire or any other cause, and such damage shall not have been repaired or reconstructed prior to the Closing Date in a good and workmanlike manner to the satisfaction of Buyer (but Seller shall have no obligations to make such repairs or reconstruction), Buyer shall receive the proceeds of any insurance payable in connection therewith under the insurance policy or policies covering the damaged property and thereupon remain obligated to perform this Agreement.

10.Representations and Warranties of Seller.

Seller represents and warrants to Buyer that:

(a)Seller has all necessary power and authority to enter into this Agreement, that all actions required to be taken by Seller to approve or authorize the execution of this Agreement and consummation of these transactions have been taken, and the execution of this Agreement and the consummation of the transactions contemplated hereby constitute the valid and binding obligation of Seller in accordance with its terms.

(b)Neither the execution of this Agreement nor the consummation of the transactions contemplated hereby will constitute a violation of or be in conflict with or constitute a default under any term or provision of any agreement, instrument or lease to which Seller is a party.

(c)To Seller’s actual knowledge, ExhibitB currently lists the name of each tenant renting a portion of the Property, the location of such tenant’s space, the monthly rental with respect to such tenancy, and security deposits, if any.

(d)To Seller’s actual knowledge, Seller has not entered into any contracts for services, supplies or the like relating to the operation or management of the Property, including, but not limited to, repair, management, rubbish removal, exterminating, vending machines, employment or maintenance contracts, other than those listed on ExhibitC or those which are cancelable on thirty (30) days’ notice or less.

(e)The person executing this Agreement on behalf of Seller is duly authorized to do so and all requisite action has been taken by Seller to authorize the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby.

(f)The conveyance of the Property at the Closing is intended to be and is acknowledged by Seller to be an absolute, irrevocable conveyance and unconditional transfer of the Property (including any and all of Seller’s rights of redemption and possession of whatsoever nature) and is not intended to be a mortgage (including an equitable mortgage), trust conveyance, deed intended as security or security instrument of any kind; and Seller acknowledges that after the conveyance, it shall have no rights of possession or redemption of whatsoever nature in and to the Property.

All of the representations and warranties set forth above in this Section shall be deemed renewed by Seller on the Closing Date as if made at such time.

11.Representations and Warranties of Buyer.

Buyer represents and warrants to Seller that:

(a)Buyer has all necessary power and authority to enter into this Agreement, that all actions required to be taken by Buyer to approve or authorize the execution of this Agreement and the consummation of these transactions have been taken and the consummation of the transactions contemplated hereby constitute the valid and binding obligation of Buyer in accordance with its terms.

(c)The person executing this Agreement on behalf of Buyer is duly authorized to do so and all requisite action has been taken by Buyer to authorize the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby.

All of the representations and warranties set forth in this Section shall be deemed renewed by Buyer on the Closing Date as if made at such time.

12.Conditions to Closing.

(a)Buyer’s obligations to close under this Agreement are expressly conditioned upon the occurrence of the following events:

(i)Seller shall have delivered to Buyer the items referred to in Subsection8(a); and

(ii)there is no stay of the sale of the Project by Seller pursuant to the Plan and this Agreement pending an appeal of the Confirmation Order.

(b)Seller’s obligations to close under this Agreement are expressly conditioned upon the occurrence of the following events:

(i)Buyer shall have delivered to Seller the items referred to in Subsection8(b);

(ii)Seller shall have obtained a fully executed copy of this Agreement and shall have assigned its rights (but not its obligations) hereunder to the Intermediary as required to effectuate the 1031 exchange set forth in Section19 below; and

(iii)there is no stay of the sale of the Project by Seller pursuant to the Plan and this Agreement pending an appeal of the Confirmation Order.

(c)If either party shall materially default on its material obligations, including but not limited to a refusal to close, the other party shall have the right to specific performance, and the defaulting party shall pay all costs incurred by the other party in obtaining such specific performance.

13.No Outside Representations.

This Agreement shall be deemed to contain all of the terms and conditions agreed upon, it being understood that there are no outside representations or oral agreements and this Agreement shall supersede all previous agreements between the parties; except to the extent that such matters are included in the Plan or the Confirmation Order. In the event of a conflict between the terms of this Agreement and the provisions of the Plan or the Confirmation Order, the terms of the Plan and Confirmation Order shall control.

14.Notices.

Unless otherwise expressly required or permitted by the terms of this Agreement, notice required or permitted to be given hereunder by the parties shall be delivered personally, by facsimile, by a standard overnight delivery service, or by certified or registered mail to the parties at the addresses set forth below, unless different addresses are given by one party to the other by written notice: