8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of report (Date of earliest event reported):
December 22, 2010

Steadfast Income REIT, Inc.

(Exact Name of Registrant as Specified in Charter)

Maryland
(State or Other Jurisdiction
of Incorporation) 333-160748
(Commission File Number) 27-0351641
(IRS Employer
Identification No.)

18100 Von Karman Avenue, Suite 500
Irvine, California 92612
(Address of Principal Executive Offices, including Zip Code)

Registrant’s telephone number, including area code: (949) 852-0700

Not applicable
(Former Name or Former Address, if Changed Since Last Report)

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

EX-10.1

EX-10.2

EX-10.3

EX-10.4

EX-10.5

EX-10.6

EX-10.7

EX-99.1

Item 1.01 Entry into a Material Definitive Agreement.

     The information set forth under Items 2.01 and 2.03 of this Current Report on Form 8-K is hereby incorporated by reference into this Item 1.01.

Item 2.01 Completion of Acquisition or Disposition of Assets.

Property Acquisition

     On December 22, 2010 (the “Closing Date”), Steadfast Income REIT, Inc. (the “Company”) acquired a fee simple interest in the Park Place Condominiums located in Des Moines, Iowa (the “Park Place Property”), through SIR Park Place, LLC (“SIR Park Place”), a wholly-owned subsidiary of Steadfast Income REIT Operating Partnership, LP, the Company’s operating partnership, from an unaffiliated third party seller.

     SIR Park Place acquired the Park Place Property for an aggregate purchase price of $8,050,000, exclusive of closing costs. SIR Park Place financed the payment of the purchase price for the Park Place Property with (1) proceeds from the Company’s public offering and (2) a loan in the aggregate principal amount of $5,000,000 (the “Loan”) from Ames Community Bank (“Lender”), evidenced by a promissory note dated December 22, 2010 (“Park Place Note”). For additional information on the terms of the Loan, see Item 2.03 below. An acquisition fee of approximately $165,000 was earned by the Company’s advisor in connection with the acquisition of the Park Place Property; however, such fee has been deferred pursuant to the terms of the Advisory Agreement by and between the Company and its advisor (the “Advisory Agreement”) until the Company’s cumulative adjusted funds from operations (as defined in the Advisory Agreement) exceed the lesser of (1) the cumulative amount of any distributions paid to the Company’s stockholders as of the date of reimbursement of the deferred fee or (2) an amount that is equal to a 7.0% cumulative, non-compounded, annual return on invested capital to the Company’s stockholders as of the date of reimbursement.

     The Park Place Property is comprised of 147 condominium units within a 16-story building located in downtown Des Moines, Iowa. The building was constructed in 1986 and contains 158 total condominium units. The Park Place Property contains 16 studio units (approximately 429 square feet per unit), 91 one-bedroom units and 40 two bedroom units (approximately 679 square feet per unit). The one-bedroom units at the Park Place Property consist of units of approximately 471, 570 and 668 square feet per unit. Amenities at the Park Place Property include a fitness center, an approximately 6,000 square foot rooftop terrace, a community room with Wi-Fi and library, a computer room, a guest suite, a secure access entry and onsite laundry. In addition to the units noted above, the Park Place Property also includes 101 onsite garage parking spaces and a nearby surface lot containing 40 parking spaces. The units are primarily leased to the corporate retail market. As of November 30, 2010, the Park Place Property was approximately 95% occupied and leased.

Management of Property

     On the Closing Date, SIR Park Place and Steadfast Management Co., Inc. (the “Property Manager”), an affiliate of the Company’s sponsor, entered into a Property Management Agreement (the “Management Agreement”), pursuant to which the Property Manager will serve as the exclusive leasing agent and manager of the Park Place Property. The Management Agreement contains customary covenants by the Property Manager with respect to leasing activities, employment of personnel, maintenance and repairs, supervision of capital improvements, required liability insurance coverage, collection of rents and other tenant charges and monthly and annual financial reports. Pursuant to the Management Agreement, SIR Park Place will pay the Property Manager a monthly management fee in an amount equal to 3.5% of the Park Place Property’s gross collections (as defined in the Management Agreement) for each month. The Management Agreement has an initial one year term and will continue thereafter on a month-to-month basis unless either party gives prior notice of its desire to terminate the Management Agreement, provided that SIR Park Place may terminate the Management Agreement at any time without cause upon thirty (30) days prior written notice to the Property Manager. Pursuant to the Management Agreement, the Property Manager has agreed to indemnify and hold harmless SIR Park Place and its affiliates, officers, directors, employees and agents from all liabilities or expenses incurred by any such party resulting from the Property Manager’s gross negligence, willful misconduct or breach of the Management Agreement.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

Park Place Loan

     In connection with the acquisition of the Park Place Property, SIR Park Place borrowed $5,000,000 from Lender pursuant to the Park Place Note and the Loan Agreement by and between SIR Park Place and Lender (together with the other loan documents, the “Loan Documents”). The Park Place Note has a 36 month term with an initial maturity date of December 31, 2013 (such date, the “Initial Maturity Date”), provided that SIR Park Place has the option to extend the Initial Maturity Date for up to two successive periods of one year each (each such period an “Extension Period”). The exercise by SIR Park Place of its option to extend the term of the Park Place Note is subject to (1) the absence of any continuing event of default under the Loan Documents, or any event which, with the giving of notice or the passage of time, or both, would constitute such an event of default, (2) SIR Park Place providing Lender with written notice of the requested Extension Period at least ten (10) days prior to the Initial Maturity Date and (3) the payment by SIR Park Place of an extension fee equal to 0.25% of the then outstanding principal balance of the Park Place Note.

     Interest on the outstanding principal balance of the Park Place Note will accrue at a rate of 5.25% per annum through the Initial Maturity Date, and a monthly payment of interest only will be due and payable on the first day of each month until the Initial Maturity Date. Subject to any Extension Period, the entire outstanding principal balance of the Park Place Note, plus any accrued and unpaid interest thereon, is due and payable in full on the Initial Maturity Date. During an Extension Period, if any, interest on the outstanding principal balance of the Park Place Note will accrue at a rate per annum equal to the One-Year Federal Home Loan Bank of Des Moines rate plus 3.75%; provided, however, that such interest rate during an Extension Period shall never be below 5.0% or above 6.5%. So long as any payment due under the Park Place Note or other Loan Documents is not paid on or before the fifth day after the due date, SIR Park Place will pay a late fee of 5.0% of the payment due which late fee will be added to the amount of principal and interest due with each such late payment. SIR Park Place may prepay all or any portion of the outstanding principal balance of the Park Place Note without premium or penalty provided SIR Park Place is current on all interest payments.

     The Loan Documents provide for customary events of default, some with corresponding cure periods, including, without limitation, payment defaults, failure to maintain required insurance coverage, material misrepresentations or omissions, bankruptcy related defaults, certain prohibited transfers and cross-defaults under any other debt secured by the Park Place Property. Upon an uncured event of default by SIR Park Place, Lender may declare all amounts due under the Park Place Note immediately due and payable in full. Upon the occurrence of an event of default, Lender is entitled to receive the entire unpaid principal sum outstanding plus 10% per annum on all amounts due pursuant to the Park Place Note computed from the date of the occurrence of the event of default to the date of payment of all amounts due under the Loan Documents, or in Lender’s discretion, the date the event of default is cured.

     The performance of the obligations of SIR Park Place under the Park Place Note is secured by (1) a Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Financing Statement between SIR Park Place and Lender with respect to the Park Place Property, including improvements, after acquired property and fixtures and personal property, and (2) an Assignment of Management Agreement. In addition, the Company has entered into a Guaranty in favor of Lender pursuant to which the Company guarantees the payment of the Loan up to $1,000,0000.

     On the Closing Date, SIR Park Place entered into an Environmental and Hazardous Substance Indemnification Agreement (the “Environmental Indemnity”), pursuant to which SIR Park Place agreed to indemnify, defend and hold harmless Lender and its affiliates or any other person identified by Lender that is involved in the origination or servicing of the Loan, from and against any losses, damages, claims or other liabilities that Lender or such other parties may suffer or incur as a result of, among other things, (1) the presence or release or threatened release of certain hazardous substances in, on, above or under the Park Place Property, (2) any past, present or threatened non-compliance with or violation of any environmental laws applicable to the Park Place Property and (3) any breach of any representation or warranty or covenant made in the Environmental Indemnity by SIR Park Place.

     The material terms of the Loan Documents and the other agreements described herein are subject to and qualified in their entirety by the agreements attached as Exhibits 10.1 through 10.7 to this Current Report on Form 8-K and incorporated by reference herein.

Item 7.01 Regulation FD Disclosure.

     On December 27, 2010, the Company distributed a press release announcing the completion of the acquisition of the Park Place Property. The full text of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 7.01.

     The information furnished under Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.

Item 9.01 Financial Statements and Exhibits.

(a) Financial Statements of Businesses Acquired.

     Because it is impracticable to provide the required financial statements for the acquisition of the real property described above at the time of this filing, and no financial statements (audited or unaudited) are available at this time, the Company hereby confirms that the required financial statements will be filed as an amendment to this Current Report on Form 8-K no later than 71 days after the deadline for filing this Current Report on Form 8-K.

(b) Pro Forma Financial Information.

     See Paragraph (a) above.

(d) Exhibits.

Exhibit	Description
10.1	Loan Agreement, dated as of December 22, 2010, by and between SIR Park Place, LLC, Steadfast Income REIT, Inc. and Ames Community Bank
10.2	Promissory Note, dated December 22, 2010, issued by SIR Park Place, LLC in favor of Ames Community Bank
10.3	Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing Statement, dated as of December 22, 2010, by and between SIR Park Place, LLC and Ames Community Bank
10.4	Guaranty, dated as of December 22, 2010, by and between Steadfast Income REIT, Inc. and Ames Community Bank
10.5	Assignment of Management Agreement, dated as of December 22, 2010, by and between SIR Park Place, LLC and Ames Community Bank
10.6	Environmental and Hazardous Substance Indemnification Agreement, dated as of December 22, 2010, by and between SIR Park Place, LLC and Ames Community Bank
10.7	Property Management Agreement, dated as of December 22, 2010, by and between SIR Park Place, LLC and Steadfast Management Co., Inc.
99.1	Press Release dated December 27, 2010

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	STEADFAST INCOME REIT, INC.
Date: December 29, 2010	By:	/s/ Rodney F. Emery
		Rodney F. Emery
		Chief Executive Officer and President

EXHIBIT INDEX

Exhibit	Description
10.1	Loan Agreement, dated as of December 22, 2010, by and between SIR Park Place, LLC, Steadfast Income REIT, Inc. and Ames Community Bank
10.2	Promissory Note, dated December 22, 2010, issued by SIR Park Place, LLC in favor of Ames Community Bank
10.3	Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing Statement, dated as of December 22, 2010, by and between SIR Park Place, LLC and Ames Community Bank
10.4	Guaranty, dated as of December 22, 2010, by and between Steadfast Income REIT, Inc. and Ames Community Bank
10.5	Assignment of Management Agreement, dated as of December 22, 2010, by and between SIR Park Place, LLC and Ames Community Bank
10.6	Environmental and Hazardous Substance Indemnification Agreement, dated as of December 22, 2010, by and between SIR Park Place, LLC and Ames Community Bank
10.7	Property Management Agreement, dated as of December 22, 2010, by and between SIR Park Place, LLC and Steadfast Management Co., Inc.
99.1	Press Release dated December 27, 2010

EX-10.1

Exhibit 10.1

LOAN AGREEMENT

          THIS LOAN AGREEMENT, dated as of the 22nd day of December, 2010 (as such agreement may be amended, restated, replaced, supplemented or otherwise modified from time to time, this “Agreement”), is between Ames Community Bank, with offices at 925 Gateway Drive, Grimes, Iowa 50111 (“Lender”), and SIR Park Place, LLC, with offices at 18100 Von Karman Avenue, Suite 500, Irvine, California (“Borrower”), and Steadfast Income REIT, Inc., a Maryland corporation, with offices at 18100 Von Karman Avenue, Suite 500, Irvine, California (“Guarantor”).

W I T N E S S E T H:

          WHEREAS, Borrower desires to obtain the Loan from Lender; and

          WHEREAS, Lender is willing to make the Loan to Borrower, and Guarantor is willing to guaranty the Loan, subject to and in accordance with the terms of this Agreement and the other Loan Documents.

          NOW, THEREFORE, in consideration of the making of the Loan by Lender to Borrower and the covenants, agreements, representations and warranties set forth in this Agreement, the parties hereto hereby covenant, agree, represent and warrant as follows:

ARTICLE I DEFINITIONS; PRINCIPLES OF CONSTRUCTION

          Section 1.1. Capitalized Terms. All capitalized terms used herein and not otherwise defined herein shall have the meanings set forth in Schedule I attached hereto or in the other Loan Documents.

          Section 1.2. Principles of Construction. All references to sections, schedules and exhibits are to sections, schedules and exhibits in or to this Agreement unless otherwise specified. Unless otherwise specified, all meanings attributed to defined terms herein shall be equally applicable to both the singular and plural forms of the terms so defined and “including” means including without limitation. Whenever the context requires, each gender shall include all other genders. All exhibits and schedules attached hereto are incorporated herein by reference for all purposes.

ARTICLE II GENERAL TERMS

          Section 2.1. Loan Commitment; Disbursement to Borrower.

          2.1.1. The Loan. Subject to and upon the terms and conditions set forth herein, Lender hereby agrees to make the Loan to Borrower in the original principal amount of up to sixty five percent (65%) of the value of the Real Property and Improvements, based on the As-Is value of the Property shown by the Appraisal, or five million and NO/100’s dollars

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($5,000,000.00), whichever amount is less (the “Loan”). Any amount borrowed and repaid hereunder in respect of the Loan may not be re-borrowed. The Note evidences the Loan, and the Loan shall bear interest and otherwise be payable as provided in the Note and this Agreement; provided, however, that in any event, the principal balance, all accrued but unpaid interest and all other sums owing on the Loan shall be due and payable on the Maturity Date or earlier if the Loan is accelerated pursuant to this Agreement or any of the other Loan Documents. The holder of the Note shall be entitled to the benefits of this Agreement and the other Loan Documents.

          2.1.2. Use of Proceeds. Borrower shall use the proceeds of the Loan to provide purchase money financing of the Real Property and Improvements and for no other purpose.

ARTICLE III CONDITIONS PRECEDENT

          As a material inducement to Lender to make the Loan, Borrower hereby represents and warrants to Lender that Borrower has satisfied, all of the conditions precedent set forth in Schedule II attached hereto, and Borrower acknowledges that Lender would not fund the Loan unless all of such conditions precedent were satisfied by the Closing Date.

ARTICLE IV REPRESENTATIONS AND WARRANTIES

          Section 4.1. Borrower Representations. Borrower represents and warrants to Lender as of the Closing Date, that:

               (a) Organization. Borrower has been duly organized and is validly existing under the laws of the State of Iowa. Borrower is duly qualified to do business in each jurisdiction where Borrower is required to be so qualified in connection with its properties, businesses and operations.

               (b) Enforceability. Borrower has taken all necessary action to authorize the execution, delivery and performance of the obligations of this Agreement and the other Loan Documents to which it is a party, and such obligations shall be the valid and binding obligations of the Borrower. This Agreement and such other Loan Documents to which Borrower is a party have been duly executed and delivered by or on behalf of it and it has obtained or received all required consents and approvals, corporate, governmental or otherwise, and this Agreement and such other Loan Documents to which it is a party constitute legal, valid and binding obligations of the Borrower enforceable against it in accordance with their respective terms, subject to applicable bankruptcy, insolvency, reorganization and similar laws affecting rights of creditors generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law).

               (c) No Conflicts. The execution and delivery of this Agreement and the other Loan Documents and the performance of the obligations thereunder by Borrower will not conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any Lien, charge or encumbrance (other than pursuant to the Loan Documents) upon any of the property or assets of the Borrower pursuant to

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the terms of any indenture, mortgage, deed of trust, loan agreement, partnership agreement, operating agreement, certificate of incorporation, bylaws or any other agreement or instrument to which it is a party or by which any of its property or assets is subject.

               (d) Litigation. There are no actions, suits, proceedings or investigations at law or in equity now pending or, to Borrower’s best knowledge, threatened against or affecting Borrower or the Property.

               (e) Agreements. Borrower is not in default in any material respect in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any agreement or instrument to which it is a party or by which it or the Property is bound. Borrower does not have Indebtedness under any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which it is a party or by which it or the Property is otherwise bound, other than (a) obligations incurred in the ordinary course of the operation of the Property and (b) obligations under the Loan Documents.

               (f) Title. Borrower has good, marketable and insurable fee simple title to the Premises, free and clear of all Liens whatsoever except the Permitted Encumbrances. The Security Instrument, when properly recorded in the appropriate records, together with the Uniform Commercial Code financing statements filed in connection with the Loan, will create (i) a valid, perfected Lien on the Property, subject only to the Permitted Encumbrances and (ii) perfected security interests in and to (or perfected collateral assignments of), all personalty (including the Leases), all in accordance with the terms thereof, in each case subject only to any applicable Permitted Encumbrances.

               (g) No Bankruptcy Filing. (A) (i) Borrower is solvent (within the meaning of all Bankruptcy Laws) and no bankruptcy, reorganization, insolvency or similar proceeding with respect to Borrower under any Bankruptcy Law has been initiated, and (ii) the entering into the Loan Documents to which Borrower is a party does not constitute a fraudulent conveyance by any Person; and (B) no petition in bankruptcy has been filed by or against Borrower, Guarantor, or any Affiliate of Borrower in the last seven (7) years, and neither Borrower or Guarantor, or any related entity, or any principal, any general partner or member thereof, in the last seven (7) years has ever made any assignment for the benefit of creditors or taken advantage of any applicable Bankruptcy Laws.

               (h) Full and Accurate Disclosure. To Borrower’s knowledge, no statement of fact made by Borrower in this Agreement or in any of the other Loan Documents, nor any written materials relating to the business, operations or condition (financial or otherwise) of Borrower or the Property that were supplied to Lender in connection with Lender’s due diligence investigation (other than financial projections in respect of which no representation is made) contains (or, in the case of such written material, at the time supplied contained) any untrue statement of a material fact or omits (or omitted, as the case may be) to state any material fact necessary to make the statements contained therein or in any of the Loan Documents not misleading.

               (i) Regulatory. Borrower is not an “employee benefit plan” (as defined in Section 3(3) of ERISA), subject to Title I of ERISA, and none of the assets of the

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Borrower constitutes or will constitute “plan assets” of one or more such plans within the meaning of 29 C.F.R. Section 2510.3-101. In addition, (i) Borrower is not a “governmental plan” within the meaning of Section 3(32) of ERISA and (ii) transactions by or with Borrower are not subject to state statutes regulating investments of, and fiduciary obligations with respect to, governmental plans. No part of the proceeds of the Loan will be used for the purpose of purchasing or acquiring any “margin stock” within the meaning of Regulation U of the Board of Governors of the Federal Reserve System or for any other purpose which would be inconsistent with such Regulation U or any other Regulations of such Board of Governors, or for any purposes prohibited by Legal Requirements or by the terms and conditions of this Agreement or the other Loan Documents. Borrower is not a “foreign person” within the meaning of § 1445(f)(3) of the Code. Borrower is not (i) an “investment company” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended; (ii) a “holding company” or a “subsidiary company” of a “holding company” or an “affiliate” of either a “holding company” or a “subsidiary company” within the meaning of the Public Utility Holding Company Act of 1935, as amended; or (iii) subject to any other federal or state law or regulation which purports to restrict or regulate Borrower’s ability to borrow the proceed of the Loan.

               (j) Insurance. Borrower has obtained and has delivered to Lender a certificate of insurance satisfactory to Lender reflecting the insurance coverages, amounts and other requirements set forth in this Agreement and there have been no acts or omissions that would impair the coverage of any such Policies or the benefits of the mortgagee endorsements.

               (k) Hazardous Substances. Borrower hereby represents and warrants to Lender that, to Borrower’s knowledge, the representations and warranties contained in the Environmental Indemnity are true and correct. Except for any specific limitation contained in the Environmental Indemnity, this representation and warranty shall survive any termination, satisfaction, or assignment of this Agreement and the exercise by Lender of any of its rights or remedies hereunder, including the acquisition of the Property by foreclosure or a conveyance in lieu of foreclosure.

               (l) Property Management Agreement. If Borrower enters into a Property Management Agreement prior to the funding of the Loan, Lender shall have received an Assignment of the Property Management Agreement and a Consent from the Property Manager to the Assignment of Property Management Agreement in forms acceptable to Lender.

               (m) Loan Proceeds. Except for Loans to Borrower to fund the acquisition of the Real Property and Improvements prior to the Closing, no Affiliate of Borrower or any Person in which Borrower or any Affiliate of Borrower owns an interest (direct, indirect or beneficial interest in Borrower) is receiving any portion of the proceeds of the Loan.

               (n) Conditions Precedent. Borrower has fulfilled and satisfied all of the conditions precedent set forth on Schedule II.

          Section 4.2. Survival of Representations. Borrower agrees that all of the representations and warranties of the Borrower set forth in Section 4.1 and elsewhere in this

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Agreement and in the other Loan Documents shall survive for so long as any amount remains owing to Lender under this Agreement or any of the other Loan Documents by Borrower.

ARTICLE V BORROWER COVENANTS

          From the date hereof and until payment and performance in full of all Obligations of Borrower under the Loan Documents, Borrower hereby covenants and agrees with Lender that:

          Section 5.1. Existence; Compliance with Legal Requirements. Borrower shall do or cause to be done all things necessary to preserve, renew and keep in full force and effect its existence, rights, Licenses, permits and franchises and to comply with all Legal Requirements applicable to the Borrower and the Property. Borrower shall not dissolve, terminate, liquidate, merge with, consolidate into or acquire another Person. Borrower shall at all times maintain, preserve and protect all franchises and trade names and preserve all of its property used or useful in the conduct of its business and shall keep the Property in good working order and repair, and from time to time make, or cause to be made, all reasonably necessary repairs, renewals, replacements, betterments and improvements thereto. Borrower will not change its name, identity (including its trade name or names) or, if not an individual, its corporate, partnership or other structure without Lender’s prior written consent. Borrower shall not allow or permit any change in the use of the Property without Lender’s prior written consent.

          Section 5.2. Hazardous Substances. Borrower shall comply strictly and in all respects with the covenants set forth in the Environmental Indemnity.

          Section 5.3. Certain Prohibited Actions. Borrower shall not directly or indirectly take any action or permit any action or inaction which could result in it not being in compliance with Section 4.1

          Section 5.4. Taxes and Other Charges. Borrower shall pay all Taxes and Other Charges now or hereafter levied or assessed or imposed against the Property or any part thereof as the same become due and payable. Borrower will deliver to Lender or Lender’s designee receipts for payment or other evidence satisfactory to Lender that the Taxes and Other Charges have been so paid or are not then delinquent no later than ten (10) days prior to the date on which the Taxes and/or Other Charges would otherwise be delinquent if not paid. Borrower shall not suffer and shall promptly cause to be paid and discharged any Lien which may be or become a Lien against the Property, and shall promptly pay for all utility services provided to the Property.

          Section 5.5. Performance of Agreements. Borrower shall observe, perform and satisfy all the terms, provisions, covenants and conditions of, and shall pay when due all principal, interest, costs, fees and expenses to the extent required under, the Loan Documents. Borrower shall observe and perform each and every term to be observed or performed by Borrower pursuant to the terms of any other agreement including, but not limited to, any lease between Borrower and any tenant of Borrower, or recorded instrument affecting or pertaining to

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Borrower or the Property, or given by Borrower to Lender for the purpose of further securing the Obligations.

          Section 5.6. Notices. Borrower shall give written notice to Lender of any litigation or governmental proceedings pending or threatened against it or the Property.

          Section 5.7. Access to Premises. Borrower shall permit agents, representatives and employees of Lender to inspect the Property or any part thereof at reasonable hours upon not less than two (2) Business Days advance notice or such shorter period of notice as circumstances may dictate without violating the right of any third party occupying any part of the Property. Any Inspection by Lender shall not unreasonably interfere with the activities of any tenant in the Property.

          Section 5.8. Compliance. Borrower shall not commit or allow any other Person in occupancy of, or involved with, the operation or use of the Property to commit any act or suffer any omission affording any Governmental Authority the right of forfeiture as against the Property or any part thereof or any monies paid in performance of Borrower’s obligations under any of the Loan Documents. Borrower shall keep and maintain all Licenses necessary for the operation of the Property for its intended use.

          Section 5.9. Insurance Benefits and Condemnation Proceeds. Borrower shall fully cooperate with Lender in obtaining for Lender the benefits of any Insurance Proceeds and Condemnation Proceeds lawfully or equitably payable in connection with the Property, and Lender shall be reimbursed for any reasonable expenses incurred in connection therewith (including attorneys’ fees and disbursements, expense of an appraisal on behalf of Lender in case of a fire or other Casualty affecting the Property or any part thereof) out of such Insurance Proceeds or Condemnation Proceeds, as applicable.

          Section 5.10. Further Assurances. Borrower will, at the cost of the Borrower and without expense to Lender, do, execute, acknowledge and deliver all and every such further reasonable acts, deeds, conveyances, mortgages, assignments, notices of assignments, transfers, boundary surveys, footing or foundation surveys, plans and specifications, title and other insurance reports and agreements and assurances as Lender shall, from time to time, reasonably require, for the better assuring, conveying, assigning, transferring, and confirming unto Lender, the property and rights hereby mortgaged, granted, bargained, sold, conveyed, confirmed, pledged, assigned, warranted and transferred or intended now or hereafter so to be, or which the Borrower may be or may hereafter become bound to convey or assign to Lender, or for carrying out the intention or facilitating the performance of its covenants under this Agreement or for filing or recording the Security Instrument, or for complying with all Legal Requirements.

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          Section 5.11. Financial Reporting and Covenants.

               (a) Borrower will keep and maintain or will cause to be kept and maintained in accordance with Acceptable Accounting Principles, proper and accurate books, records and accounts reflecting all of the financial affairs, income and expenses of the Borrower and the Property. Lender shall have the right from time to time at all times during normal business hours upon reasonable notice to examine such books, records and accounts at the office of the Borrower or other Person maintaining such books, records and accounts and to make such copies or extracts thereof as Lender shall desire. Borrower shall furnish or make available to Lender and its agents convenient facilities for the examination and audit of any of its books and records.

               (b) Borrower and Guarantor will furnish to Lender annually, within one hundred twenty (120) days following the end of each Fiscal Year, a certified income statement and balance sheet for Borrower and Guarantor for such Fiscal Year.

               (c) Borrower will furnish, or cause to be furnished, to Lender: (A) on or before thirty (30) days after the end of each quarter in the Fiscal Year, Financial Statements with respect to the Property; and (B) at the end of each quarter in the Fiscal Year, a certified rent roll in a format reasonably acceptable to Lender.

               (d) Borrower and Guarantor will furnish to Lender, within one hundred twenty (120) days following the end of each Fiscal Year, complete copies of federal and state income tax returns, including all K-1 schedules received from any partnerships, corporations, or trusts, within forty-five (45) days following the date each such return is required to be filed including any extension period granted for said return.

               (e) Borrower shall furnish to Lender, within ten (10) Business Days after request (or as soon thereafter as may be reasonably possible) such further detailed information, as may be reasonably requested by Lender.

               (f) During the initial 36-month term of the Loan, Borrower shall maintain a debt service coverage ratio (“DSCR”) of 1.60:1.00 with respect to the Property, calculated annually by Lender as of the end of each Fiscal Year by taking the net income before depreciation, amortization, and interest expense, divided by Debt payments for the Loan based upon interest-only expense. In the event Borrower exercises any extensions under the Note, Borrower shall maintain a DSCR during such extension period of 1.25:1.00 with respect to the Property, calculated annually by Lender as of the end of each Fiscal Year by taking the net income before depreciation, amortization, and interest expense, divided by Debt payments for the Loan based upon a 30 year amortization.

          Section 5.12. Title to the Property.

Borrower will warrant and defend (i) the title to the Property and every part thereof, subject only to Liens permitted hereunder (including Permitted Encumbrances), and (ii) the validity and priority of the Liens of the Security Instrument and the Assignment of Leases on the Property

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and the perfection and priority of the Liens created by the Loan Documents, including any UCC Financing Statements, subject only to Liens permitted hereunder (including Permitted Encumbrances), in each case against the claims of all Persons whomsoever. The Obligors shall reimburse Lender on demand for any losses, costs, damages or expenses (including reasonable attorneys’ fees and court costs) incurred by Lender if an interest in the Property, other than as permitted hereunder, is claimed by another Person.

          Section 5.13. Leasing Matters. Borrower shall duly and punctually observe and perform all material obligations imposed upon the landlord under each of the Leases and shall not do or permit to be done anything to materially impair the value of the Leases as security for the Debt.

          Section 5.14. Business Purposes. The Loan is solely for the business purpose of Borrower, and is not for personal, family, household, or agricultural purposes.

          Section 5.15. Property Manager. Borrower shall not, without the prior written consent of Lender, enter into, execute, orally agree upon, amend, modify, cancel, surrender or terminate any Property Management Agreement or allow any Property Management Agreement to terminate or otherwise replace any Property Manager of the Property or enter into any other Property Management Agreements that have not been approved by Lender. The Property Management Agreement shall provide that management fees shall not be paid to the Property Manager during any monetary Event of Default.

          Section 5.16. Intentionally Deleted

          Section 5.17. Operation of Property. Borrower shall not change the use of the Property unless otherwise consented to by Lender in Lender’s sole discretion. Borrower shall not commit or suffer any waste of the Property or make any change in the use of the Property which will in any way materially increase the risk of fire or other hazard arising out of the operation of the Property, or take any action that will invalidate or give cause for cancellation of any Policy, or do or permit to be done thereon anything that will in any way materially impair the value of the Property or the security of this Agreement. Borrower shall not commit, permit or suffer to exist any act or omission that would cause any risk of forfeiture as against the Property or any part thereof or any monies paid in performance of the Obligations.

          Section 5.18. Maintenance of Property; Payment for Labor and Materials.

               (a) Borrower shall at its sole cost and expense promptly repair, replace or rebuild any part of the Property which may be destroyed by any Casualty, or become damaged, worn or dilapidated and shall complete and pay for (or cause the Tenants to pay for) any structure at any time in the process of construction or repair on the Property. Borrower will promptly pay when due all bills and costs for labor, materials and specifically fabricated materials incurred in connection with the Property and never permit to exist beyond the due date thereof in respect of the Property or any part thereof any Lien or security interest, even though subordinate to the Liens and the security interests of the Security Instrument, and in any event never permit to be created or exist in respect of the Property or any part thereof any other or additional Lien or security interest other than the Lien created by the Loan Documents and the Permitted Encumbrances,

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provided, however, Borrower shall have the right to contest in good faith any matters which gave rise to any such Lien by appropriate proceedings without the prior payment thereof so long as Borrower deposits with Lender the entire amount of such lien including amounts sufficient to cover interest and attorneys’ fees or provides such other security reasonably satisfactory to Lender.

               (b) Borrower shall cause the Property to be maintained in a good and safe condition and repair. The Improvements shall not be removed, demolished or altered in any material respect nor shall any additional improvements be constructed without the prior, written consent of Lender.

          Section 5.19. Transfer or Encumbrance of the Property. Borrower shall not, without the prior written consent of Lender, sell, convey, alienate, mortgage, encumber, pledge or otherwise Transfer the Property, or any part thereof or any interest therein, directly or indirectly, or permit the Transfer of the Property, or any part thereof or any interest therein, other than pursuant to Leases of space. In the event Borrower seeks Lender’s consent to a Transfer, such consent shall be granted or denied by Lender in its sole discretion. Notwithstanding anything to the contrary in the foregoing, Lender hereby consents to the transfer of the portion of the Real Property legally described as Lot 7 in Division 2 GRIMMEL’S ADDITION TO THE TOWN OF FORT DES MOINES, an Official Plat, now included in and forming a part of the City of Des Moines, Polk County, Iowa, provided a release price equal to 100% of net sales proceeds (not less than $100,000) shall be paid to Lender and applied by Lender to the reduction of the outstanding principal balance of the Loan. For the purposes hereof, net sales proceeds shall equal the gross sale price for the property to be sold less transfer taxes and other closing costs customarily and normally paid by a seller, and including, without limitation, Seller’s brokerage commissions to unrelated third party brokers at then prevailing market rates.

          Section 5.20. ERISA. Borrower shall not engage in any transaction which would cause any obligation, or action taken or to be taken, under the Loan Documents (or the exercise by Lender of any of its rights under the Loan Documents) to be a non-exempt (under a statutory or administrative class exemption) prohibited transaction under ERISA.

          Section 5.21. Affiliate Transaction. Borrower shall disclose any Affiliate Transaction to Lender. Any such Affiliate Transaction, shall only be entered into upon such terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such Affiliate.

          Section 5.22. Service Rights. Borrower shall not allow any Service Rights to be granted by any Person other than Borrower or any owner’s association for the Property and any Service Rights granted by any Person other than Borrower, any owner’s association for the Property or the Property Manager shall be null and avoid ab initio.

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          Section 5.23. Acquisition of Additional Condo Units. Borrower agrees that in the event it, or an Affiliate, acquires a fee simple interest in any additional condo units in the Property after the Closing Date, such units shall serve as additional collateral securing payment of the Debt. Upon acquisition of additional condo units in the Property, Borrower agrees to grant Lender a first lien mortgage on the property in substantially the same form as the Security Instrument.

ARTICLE VI CASUALTY; CONDEMNATION; ESCROWS

          Section 6.1. Insurance; Casualty and Condemnation.

          6.1.1. Insurance.

               (a) The Borrower shall obtain and maintain, or cause to be maintained, during all times that any sum is outstanding under the Note or the other Loan Documents (“Term”), insurance for the Borrower, the Lender, any participant of Lender, and the Property providing at least the following coverages:

          (i) Comprehensive all risk insurance on the Improvements and all personal property, in each case (A) in an amount equal to the “full replacement cost,” but the amount shall in no event be less than the outstanding principal balance of the Loan; (B) providing for no deductible in excess of the lesser of $10,000.00 and one percent (1%) of the face value of such policy; and (C) containing an “Ordinance or Law Coverage” or “Enforcement” endorsement if any of the Improvements or the use of the Property shall at any time constitute legal non-conforming structures or uses.

          (ii) Commercial general liability insurance against claims for personal injury, bodily injury, death or property damage occurring upon, in or about the Property, such insurance (A) to be on the so-called “occurrence” form with a combined single limit of not less than $1,000,000 per person/$5,000,000 per occurrence, or such higher amount as may be required by Lender; and (B) to continue at not less than the aforesaid limit until required to be changed by Lender in writing by reason of changed economic conditions making such protection inadequate.

          (iii) Business income insurance covering all risks required to be covered by the insurance provided for in Section 6.1.1(a)(i); and in an amount equal to 100% of the projected gross income from the Property for a period of twenty-four (24) months. The amount of such business income insurance shall be determined prior to the date hereof and at least once each year thereafter based on Borrower’s reasonable estimate (subject to Lender’s review and approval) of the gross income from the Property for the succeeding twenty-four (24) month period. All Insurance Proceeds payable to Lender pursuant to this Section 6.1.1(iii) shall be held by Lender and shall be applied to the Obligations from time to time due and payable hereunder and under the Loan; provided, however, that nothing herein contained shall be deemed to relieve Borrower of its obligations to pay the Obligations on the respective dates of payment provided for in

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the Note except to the extent such amounts are actually paid out of the proceeds of such business income insurance.

          (iv) At all times during which structural construction, repairs or alterations are being made with respect to the Improvements, Borrower’s insurance shall include contingent or protective liability insurance covering claims not covered by or under the terms or provisions of the above mentioned commercial general liability insurance policy.

          (v) Umbrella liability insurance in an amount not less than $1,000,000 per occurrence on terms consistent with the commercial general liability insurance policy required under this Section 6.1.1(a).

          (vi) Such other insurance and in such amounts as Lender from time to time may reasonably request against such other insurable hazards which at the time are commonly insured against for property similar to the Property located in or around the region in which the Property is located.

               (b) All insurance provided for in Section 6.1.1(a) shall be obtained under valid and enforceable policies (“Policies” or in the singular, “Policy”), and shall be issued by companies licensed to do business in the State of Iowa. The Policies shall designate Lender as first mortgagee, except as to general liability and umbrella liability under which Lender shall be named as an additional insured.

               (c) All Policies of insurance provided for in Section 6.1.1(a) shall contain clauses or endorsements to the effect that:

          (i) No act or negligence of Borrower, or anyone acting for Borrower, or of any Tenant under any Lease or other occupant, or failure to comply with the provisions of any Policy which might otherwise result in a forfeiture of the insurance or any part thereof, shall in any way affect the validity or enforceability of the insurance insofar as Lender is concerned.

          (ii) The Policy shall not be materially changed (other than to increase the coverage provided thereby) or cancelled without at least thirty (30) days written notice to Lender and any other party named therein as an insured and there shall be no exculpation for the carrier’s failure to notify Lender.

          (iii) Each Policy shall provide that the issuers thereof shall give written notice to Lender if the Policy has not been renewed thirty (30) days prior to its expiration and there shall be no carrier exculpation for the carrier’s failure to notify Lender.

               (d) If at any time Lender is not in receipt of written evidence that all insurance required hereunder is in full force and effect, Lender shall have the right, upon ten (10) business days’ notice to Borrower to take such action as Lender deems necessary to protect Lender’s interest in the Property, including the obtaining of such insurance coverage as Lender in Lender’s sole discretion deems appropriate, and all expenses incurred by Lender in connection

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with such action or in obtaining such insurance and keeping it in effect shall be paid by Borrower to Lender upon demand and until paid shall be secured by the Loan Documents and shall bear interest at the Default Rate.

               (e) In the event of foreclosure of any Security Instrument, or other transfer of title to the Property in extinguishment in whole or in part of the Debt, all right, title and interest of Borrower in and to such Policies then in force concerning the Property and all proceeds payable thereunder shall thereupon vest in the purchaser at such foreclosure or Lender or other transferee in the event of such other transfer of title.

               (f) If the Property or any portion of the Property is damaged or destroyed, in whole or in part, by fire or other casualty (a “Casualty”), Borrower shall give prompt written notice thereof to Lender. Following the occurrence of a Casualty, Borrower shall, regardless of whether Insurance Proceeds are available promptly proceed to restore, repair, replace or rebuild the same to be of at least equal value and of substantially the same character as prior to such damage or destruction, all to be effected in accordance with applicable law and the terms and conditions of the Loan Documents. The expenses incurred by Lender in the adjustment and collection of Insurance Proceeds shall become part of the Debt and be secured by the Loan Documents and shall be added to the principal balance of the sums due under the Note and shall bear interest thereafter until paid as provided in the Note and this Agreement.

               (g) Borrower shall comply with all insurance requirements of any insurer of the Property or any portion thereof and shall not bring or keep or permit to be brought or kept any article upon any of the Property or any portion thereof or cause or permit any condition to exist thereon which would be prohibited by an insurance requirement, or would invalidate any Policies then in effect or any of the insurance coverage required hereunder to be maintained by Borrower on or with respect to any part of the Property pursuant to this Agreement.

               (h) Any reimbursement due to Lender pursuant to this Section 6.1.1 must be paid within thirty (30) days (or sooner if required), or such amount shall accrue interest at the Default Rate until paid to Lender.

          6.1.2. Casualty and Application of Proceeds.

               (a) In case of loss or damages covered by any of the Policies, the following provisions shall apply:

          (i) In the event of a Casualty that is less than $1,000,000 Borrower may settle and adjust any claim without the consent of Lender and retain the proceeds thereof; however, Borrower shall give notice to Lender of each such Casualty and of the settlement thereof.

          (ii) In the event of a Casualty in the amount of $1,000,000 or more, if each of the following is true at all times: (A) the Insurance Proceeds are sufficient to pay for the Restoration as reasonably determined by Lender; (B) after such Restoration the Property will adequately secure the outstanding balance of the Loan; (C) no Default or Event of Default exists; (D) Lender shall be satisfied that the Restoration will be

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completed on or before the earliest of (i) prior to the Maturity Date, (ii) twelve (12) months after the occurrence of the Casualty; (E) the Property and the use thereof after the Restoration will be in compliance with and permitted under all applicable Legal Requirements; and (F) the Casualty does not result in the loss of access to the Property or the Improvements, then the Insurance Proceeds shall be deposited with Lender and after reimbursement of any expenses incurred by Lender, such Insurance Proceeds shall be maintained and applied to pay for the cost of restoring, repairing, replacing or rebuilding the Property or part thereof subject to the Casualty (“Restoration”), in the manner set forth herein. Borrower hereby covenants and agrees to commence and diligently to prosecute such Restoration; provided that: (A) Borrower shall pay all costs (and if required by Lender, Borrower shall deposit the total thereof with Lender in advance) of such Restoration in excess of the net Insurance Proceeds made available pursuant to the terms hereof; (B) the Restoration shall be done in compliance with all applicable Legal Requirements; (C) Borrower shall commence the Restoration as soon as reasonably practicable (but in no event later than thirty (30) days after settlement with the applicable insurance carrier regarding the Insurance Proceeds arising from the Casualty) and shall diligently pursue the same to satisfactory completion; (D) the Restoration shall be done and completed by Borrower in an expeditious and diligent fashion and in compliance with all applicable Legal Requirements, including any applicable Environmental Laws; and (E) Lender shall have received evidence reasonably satisfactory to Lender that, during the period of the Restoration, the sum of (A) income derived from the Property, as reasonably determined by Lender, plus (B) proceeds of rent loss insurance or business interruption insurance, if any, to be paid, will equal or exceed the sum of (1) expenses in connection with the operation of the Property, (2) the required payments of principal and interest on the Loan, and (3) the other payments required pursuant to this Agreement or the Loan Documents.

               (b) Except as provided above in Section 6.1.2(a)(ii), the Insurance Proceeds collected upon any Casualty shall be deposited with Lender and at Lender’s option (in its sole discretion), be applied to the payment of the Debt after reimbursement of any expenses incurred by Lender or, if Lender so elects (without any obligation to do so), after reimbursement of any reasonable expenses incurred by Lender, Lender shall hold such amount and such proceeds shall be maintained and applied in accordance with the Loan Documents to pay for the cost of any Restoration in the manner set forth herein. Any such application to the Debt shall be without prepayment premium, but shall otherwise be at Lender’s sole discretion, except as specifically provided herein to the contrary, and shall be applied to those payments of principal and interest (including any Additional Interest) in inverse order, due under the Note or as otherwise determined by Lender and shall not postpone or reduce any payments otherwise required pursuant to the Note and the other Loan Documents or otherwise determined by Lender.

          6.1.3. Condemnation.

               (a) Borrower shall promptly give Lender written notice of the actual or threatened commencement of any condemnation or eminent domain proceeding against the Property or the Improvements or any part thereof (a “Condemnation”) and shall deliver to Lender copies of any and all papers served by or on or received by Borrower in connection with such Condemnation. Following the occurrence of a Condemnation, Borrower, regardless of whether

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an Award is available, shall promptly proceed to restore, repair, replace or rebuild the Property to the extent practicable to be of at least equal value and of substantially the same character as prior to such Condemnation, all to be effected in accordance with all Legal Requirements.

               (b) Notwithstanding any taking in connection with a Condemnation by any public or quasi-public authority (including any transfer made in lieu of or in anticipation of such a Condemnation), Borrower shall continue to pay the Debt at the time and in the manner provided for in the Note and the other Loan Documents and the Debt shall not be reduced unless and until any Award shall have been actually received and applied by Lender to expenses of collecting the Award and to discharge of the Debt. Lender shall not be limited to the interest paid on the Award by the condemning authority but shall be entitled to receive out of the Award interest at the rate or rates provided in the Note. During the occurrence of any uncured Event of Default, Borrower shall cause any Award that is payable to Borrower to be paid directly to Lender.

               (c) During the occurrence of any uncured Event of default, the proceeds of any amount collected upon any Condemnation (“Award”) shall be deposited directly with Lender pursuant to Section 6.1.3(b) and at Lender’s option (in its sole discretion), shall be applied to the payment of the Debt (after reimbursement of any expenses incurred by Lender) or, if Lender so elects (without any obligation to do so), (after reimbursement of any expenses incurred by Lender), Lender shall hold such amount and such proceeds shall be maintained and applied in accordance with the Loan Documents to pay for the cost of any Restoration in the manner set forth herein. Any such application to the Debt shall be without prepayment premium, but shall otherwise be at Lender’s sole discretion and shall be applied to those payments of principal and interest (including any Additional Interest) in inverse order due under the Note or as otherwise determined by Lender and shall not postpone or reduce any payments otherwise required pursuant to the Note and the other Loan Documents. If the Property is sold, through foreclosure or otherwise, prior to the receipt by Lender of such Award, Lender shall have the right, if there is a deficiency judgment to receive all or a portion of said Award sufficient to pay the outstanding balance of the Debt.

               (d) If such Condemnation affects less than sixty-five percent (65%) of the gross square footage of the Improvements, the Condemnation Proceeds shall be deposited with Lender and maintained and applied to pay for the cost of restoring, repairing, replacing, or rebuilding the Property or the part thereof subject to Condemnation, and such Condemnation and the Condemnation Proceeds resulting therefrom shall be treated as a Restoration under Section 6.1.2(a)(ii) hereof.

          Section 6.2. Tax Escrow. Upon an uncured Event of Default, Borrower shall establish and maintain a tax escrow account with Lender. In such event, Borrower shall pay to Lender on each Scheduled Payment Date (a) one-twelfth of the Taxes that Lender estimates will be payable during the next ensuing twelve (12) months in order to accumulate with Lender sufficient funds to pay all such Taxes at least thirty (30) days prior to their respective due dates (the “Tax Escrow Fund”). Lender will apply the Tax Escrow Fund to payments of Taxes required to be made by Borrower pursuant to Section 6.2 and under the other Loan Documents. Any amount remaining in the Tax Escrow Fund after the Debt has been paid in full shall be returned to Borrower.

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ARTICLE VII DEFAULTS

          Section 7.1. Event of Default.

               (a) Each of the following shall constitute an event of default hereunder (an “Event of Default”):

          (i) (a) any payment or amount due on any Scheduled Payment Date is not paid within Three (3) Business Days after notice being given to Borrower of the late payment, or (b) any payment or amount due on the Maturity Date is not paid on such date;

          (ii) any of the Taxes or Other Charges (other than any of the same payable on a Scheduled Payment Date) are not paid when the same are due and payable except to the extent sums sufficient to pay such Taxes and Other Charges have been deposited with Lender in accordance with terms of this Agreement and Lender fails to pay same;

          (iii) the Policies are not kept in full force and effect, or ongoing Certificates of Insurance showing Lender as a named insured not delivered to Lender within twenty (20) days of request by Lender;

          (iv) unless made in connection with payment of the Loan in full, a Transfer shall occur without Lender’s prior written consent;

          (v) any representation or warranty made by Borrower or Guarantor herein or in any other Loan Document, or in any report, certificate, financial statement or other instrument, agreement or document furnished to Lender in connection with the Loan, shall have been false or misleading in any material respect as of the date the representation or warranty was made; provided, however, if such false or misleading representation or warranty is susceptible of being cured within thirty (30) days, the same shall be an Event of Default hereunder only if the same is not cured within a reasonable time not to exceed thirty (30) days after notice from Lender;

          (vi) if (a) Borrower or Guarantor shall commence any case, proceeding or other action (1) under any existing or future Bankruptcy Laws, or (2) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for Borrower or Guarantor or for all or any substantial part of the assets of Borrower or Guarantor, or Borrower or Guarantor shall make a general assignment for the benefit of creditors; or (b) there shall be commenced against Borrower or Guarantor any case, proceeding or other action of a nature referred to in clause (a) above which (1) results in the entry of an order for relief or any such adjudication or appointment or (2) remains undismissed, undischarged or unbonded for a period of thirty (30) days; or (c) Borrower or Guarantor shall take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (a) or (b) above; or (d) Borrower or Guarantor shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due;

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          (vii) if Borrower shall be in default under any other permitted mortgage, deed of trust or security agreement covering any part of the Property whether it be superior or junior in Lien to the Security Instrument and whether it be permitted under the Loan Documents or if Borrower shall be in default of any other Indebtedness, secured or unsecured, owed by Borrower to any Person; provided, however, the foregoing shall not be deemed to permit Borrower to incur any other Indebtedness unless expressly permitted by the Loan Documents;

          (viii) if the Property becomes subject to any mechanic’s or materialman’s lien or other Lien except a Lien for local real estate taxes and assessments not then due and payable and the Lien shall remain undischarged of record (by payment, bonding or otherwise) for a period of thirty (30) days;

          (ix) except as permitted in this Agreement, the demolition or removal of any of the Improvements with a value in excess of $250,000 without the prior consent of Lender;

          (x) The occurrence of a default under the terms of any Management Agreement;

          (xi) If any term, covenant or provision of any of the other Loan Documents specifies a cure period for any breach thereof, if Borrower shall continue to be in default under such term, covenant, or provision of any of the Loan Documents (including this Agreement), beyond such applicable cure periods contained herein or in those documents;

          (xii) the prohibition, enjoining or interruption of Borrower’s right to occupy, use or lease the Property for a continuous period of more than thirty (30) days;

          (xiii) (i) the condemnation, seizure or appropriation of, or occurrence of an uninsured Casualty with respect to any material portion of the Property; or (ii) the sequestration or attachment of, or any levy or execution upon any of the Property, any other collateral provided by Borrower or Borrower under any of the Loan Documents, or any substantial portion of the other assets of Borrower or Borrower, which sequestration, attachment, levy or execution is not released, expunged or dismissed prior to the earlier of thirty (30) days or the sale of the assets affected thereby;

          (xiv) the failure at any time of the Security Instrument to be a valid first lien upon the Property or any portion thereof, other than as a result of any release or reconveyance of the Security Instrument with respect to all or any portion of the Property pursuant to the terms and conditions of this Agreement; and

          (xv) the failure of Borrower to comply with the Environmental Indemnification.

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          Section 7.2. Remedies.

               (a) Upon the occurrence of any Event of Default, subject to section 7.2(g) below, Lender may take such action, without notice, demand presentment, protest or other requirements of any kind (all of which are expressly waived by Borrower), as Lender deems advisable to protect and enforce its rights and remedies against Borrower and/or Guarantor and in and to the Property, including the following actions, each of which may be pursued concurrently or otherwise, at such time and in such order as Lender may determine, in its sole discretion, without impairing or otherwise affecting the other rights and remedies of Lender:

          (i) declare the entire Debt to be immediately due and payable;

          (ii) exercise any of the rights or remedies specified in the Security Instrument;

          (iii) apply any sums then deposited with Lender or other third party under the control of Lender and any other sums held in escrow or otherwise by Lender, in accordance with the terms of this Agreement or any other Loan Document to the payment of the following items in any order in Lender’s sole discretion: (i) Taxes and Other Charges; (ii) Insurance Premiums; (iii) interest on the unpaid principal balance of the Note; (iv) amortization of the unpaid principal balance of the Note; and (v) all other sums payable pursuant to the Note, this Agreement and the other Loan Documents, including advances made by Lender pursuant to the terms of this Agreement;

          (iv) pursue such other rights and remedies as may be available at law or in equity or under the Uniform Commercial Code including the right to receive all Rents, proceeds from the Intangibles (as defined in the Security Instrument) and any other receivables or rights to payments of Borrower relating to the Property;

          (v) with or without actual or threatened waste to the Property, Lender shall, at Lender’s sole, absolute and unfettered option and discretion, be entitled, and is hereby expressly and irrevocably authorized, upon application to a court of competent jurisdiction, without notice to Borrower, or any other party (any and all such notice being waived hereby) and without regard to the adequacy of any security for the Debt or the solvency of Borrower or any other party liable for payment of the Debt, to appoint a receiver(s), on an emergency and ex parte basis or otherwise, to take possession of and to operate the Property, and at Lender’s option, to collect the Rents, or to take such other actions as Lender in its sole discretion shall deem appropriate with respect to the Property. Borrower specifically waives any bond requirement for any Receiver appointed pursuant to the Loan Documents. Borrower irrevocably waives all notice of and defenses and objections to the appointment of such receiver. Borrower further irrevocably agrees that the occurrence of any Event of Default per se would create an emergency and the necessity for immediate actions; and

          (vi) pursue any other right or remedy allowed by any Loan Document or applicable law.

               (b) Upon the occurrence and during the continuance of an Event of Default, interest on the outstanding principal balance of the Loan and, to the extent permitted by

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law, overdue interest and other amounts due in respect of the Loan, shall accrue at the Default Rate, calculated from the date such payment was due without regard to any grace or cure periods contained herein. Interest at the Default Rate shall be computed from the occurrence of the Event of Default until the actual receipt and collection of the Debt (or that portion thereof that is then due). To the extent permitted by applicable law, interest at the Default Rate shall be added to the Debt, shall itself accrue interest at the same rate as the Loan and shall be secured by the Security Instrument. This subsection shall not be construed as an agreement or privilege to extend the date of the payment of the Debt, nor as a waiver of any other right or remedy accruing to Lender by reason of the occurrence of any Event of Default; the acceptance of any payment of by Lender shall not be deemed to cure or constitute a waiver of any Event of Default; and Lender retains its rights under this Agreement and the other Loan Documents to accelerate and to continue to demand payment of the Debt upon the happening of any Event of Default, despite any payments made to Lender after the occurrence of such Event of Default.

               (c) Lender may resort to any remedies and the security given by any of the Loan Documents in whole or in part, and in such portions and in such order as determined by Lender in its sole discretion. No such action shall in any way be considered a waiver of any rights, benefits or remedies evidenced or provided by the Note, the Security Instrument or any of the other Loan Documents. The failure of Lender to exercise any right, remedy or option provided in any of the Loan Documents shall not be deemed a waiver of such right, remedy or option or of any covenant or obligation secured by the Note, the Security Instrument or the other Loan Documents. No acceptance by Lender of any payment after the occurrence of any Event of Default and no payment by Lender of any obligation for which Borrower is liable hereunder shall be deemed to waive or cure any Event of Default, or Borrower’s liability to pay such obligation. No sale of all or any portion of the Property, no forbearance on the part of Lender, and no extension of time for the payment of the whole or any portion of the Debt or any other indulgence given by Lender to Borrower, shall operate to release or in any manner affect the interest of Lender in the remaining Property or the liability of Borrower to pay the Debt. No waiver by Lender shall be effective unless it is in writing and then only to the extent specifically stated.

               (d) With respect to Borrower and the Property, nothing contained herein or in any other Loan Document shall be construed as requiring Lender to resort to the Property for the satisfaction of any of the Debt, and Lender may seek satisfaction out of the Property or any part thereof or decline to do so, in Lender’s sole and absolute discretion.

               (e) Additionally, upon the occurrence of any Event of Default or if Guarantor fails to make any payment or to do any act as required in any of the Loan Documents, Lender may, but without any obligation to do so and without notice to, or demand on, Guarantor and without releasing Guarantor from any obligation under the Loan Documents, make or do the same in such manner and to such extent as Lender may deem necessary to protect the security hereof. Lender is authorized to enter upon the Property for such purposes or appear in, defend, or bring any action or proceeding to protect its interest in the Property or to foreclose the Loan Documents or collect the Debt, and the cost and expense thereof (including reasonable attorneys’ fees and disbursements to the extent permitted by law), with interest at the Default Rate (as defined in the Note) for the period after notice from Lender that such cost or expense was incurred to the date of payment to Lender, shall constitute a portion of the Debt, shall be secured by the Loan Documents and shall be due and payable to Lender upon demand.

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               (f) Notwithstanding any other provision of this Agreement, Lender reserves the right to seek a deficiency judgment or preserve a deficiency claim in connection with the foreclosure of the Security Instrument to the extent necessary to foreclose on all or any portion of the Property, the Rents or any other collateral.

               (g) Borrower shall have Three (3) Business Days after notice from Lender to cure any monetary or payment Event of Default. Upon notice by Lender, Borrower shall have thirty (30) days from the date of said notice to cure any non-monetary Event of Default. Provided, however, in the event of a non-monetary event of default, if Borrower is diligently attempting to remedy the non monetary event of default, Lender shall reasonably extend the time for Borrower, not to exceed one-hundred twenty (120) days, to come into conformance with its obligations pursuant to the Loan Documents.

          Section 7.3. Right of Entry. In addition to any other rights or remedies granted under this Agreement, Lender and its agents shall have the right to enter and inspect the Property at any reasonable time during the term of the Loan upon two (2) business days notice to Borrower. If Lender’s entry and inspection of the Property reveals a Borrower Event of Default the cost of such inspections or audits, including the cost of all follow up or additional investigations or inquiries deemed reasonably necessary by Lender, shall be borne by Borrower. The cost of such inspections, to the extent payable by Borrower, if not paid for by Borrower following demand, may, at Lender’s option, be added to the principal balance of the sums due under the Note and shall bear interest thereafter until paid at the Default Rate.

          Section 7.4. Costs of Enforcement. In the event of the (i) exercise of any remedy by Lender under this Agreement or the other Loan Documents or following the occurrence of an Event of Default, (ii) foreclosure of any mortgage prior to or subsequent to the Security Instrument in which proceeding Lender is made a party, (iii) bankruptcy, insolvency, reorganization, rehabilitation, liquidation or other similar proceeding in respect of Guarantor or an assignment by Guarantor for the benefit of its creditors, (iv) enforcement of any obligations of or collection of any payments due from Borrower under this Agreement, the other Loan Documents or with respect to the Property, or (v) incurring of any costs or expenses by Lender in connection with any refinancing or restructuring of the credit arrangements provided under this Agreement in the nature of a “work-out”, then Borrower and/or Borrower, its successors or assigns, shall pay to Lender on demand any and all expenses, including legal expenses and attorneys’ fees, incurred or paid by Lender in protecting Lender’s interest in the Property or in collecting any amount payable hereunder or in enforcing Lender’s rights hereunder with respect to the Property, whether or not any legal proceeding is commenced hereunder or thereunder and whether or not any Default or Event of Default shall have occurred and is continuing, together with interest thereon at the Default Rate from the date paid or incurred by Lender until such expenses are paid by Borrower; provided, however, that Borrower shall not be liable for the payment of any such costs and expenses to the extent the same arise by reason of the gross negligence or willful misconduct of Lender.

          Section 7.5. Remedies Cumulative. The rights, powers and remedies of Lender under this Agreement and the other Loan Documents shall be cumulative and not exclusive of any other right, power or remedy which Lender may have against Borrower or

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Guarantor pursuant to this Agreement or the other Loan Documents, or existing at law or in equity or otherwise. Lender’s rights, powers and remedies may be pursued singly, concurrently or otherwise, at such time and in such order as Lender may determine, in Lender’s sole discretion. No delay or omission to exercise any remedy, right or power accruing upon an Event of Default shall impair any such remedy, right or power or shall be construed as a waiver thereof, but any such remedy, right or power may be exercised from time to time and as often as may be deemed expedient. A waiver of one Default or Event of Default with respect to Borrower shall not be construed to be a waiver of any subsequent Default or Event of Default by Borrower or to impair any remedy, right or power consequent thereon. Any and all amounts collected or retained by Lender after an Event of Default has occurred, including interest at the Default Rate, late charges or any escrowed amount, may be applied by Lender to payment of the Debt in any order or priority that Lender, in its sole discretion, may elect.

ARTICLE VIII INDEMNIFICATION.

          Section 8.1. General Indemnification. In addition to any other indemnifications provided herein or in the other Loan Documents, except to the extent arising out of the negligence or willful misconduct of an Indemnified Party, Borrower and Guarantor shall, at its sole cost and expense to the maximum extent allowed by law, including as a result of any act or inaction of an Indemnified Party, protect, defend, indemnify, release and hold harmless the Indemnified Parties from and against any and all Losses imposed upon, or incurred by, or asserted against any Indemnified Parties and directly or indirectly arising out of, or in any way relating to or connected with, any one or more of the following: (a) any accident, injury to or death of persons or loss of, or damage to property occurring in, on or about the Property or any part thereof or on the adjoining sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways; (b) any use, nonuse or condition in, on or about the Property or any part thereof or on adjoining sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways; (c) performance of any labor or services or the furnishing of any materials or other property in respect of the Property or any part thereof; (d) any failure of the Property to be in compliance with any Legal Requirements; (e) any failure of the Property to comply with any Access Laws; (f) any representation or warranty made in any of the Loan Documents being false or misleading in any material respect as of the date such representation or warranty was made or the use or intended use of the proceeds of the Loan; (g) any claim by brokers, finders or similar Persons claiming to be entitled to a commission in connection with the Loan (other than one claiming to have dealt exclusively with, or for the sole benefit of, Lender) or any Lease or other transaction including any sale of any condominium unit involving the Property; and (h) the claims of any Tenant and not applied in accordance with the Loan Documents (except any claims of Tenants first accruing after the date Lender or Lender’s Affiliate takes title to the Property). Any amounts payable to Lender by reason of the application of this paragraph shall be secured by the Loan Documents and shall become immediately due and payable and shall bear interest at the Default Rate from the date of demand until paid. The obligations and liabilities of Borrower under this Section 8.1 shall survive termination, satisfaction, or assignment of this Agreement, the repayment of the Debt and the exercise by Lender of any of its rights or remedies hereunder, including the acquisition of the Property by foreclosure or a conveyance in lieu of foreclosure.

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          Section 8.2. Duty to Defend; Attorneys’ Fees and Other Fees and Expenses. Upon written request by any Indemnified Party, Borrower shall defend such Indemnified Party (if requested by any Indemnified Party, in the name of the Indemnified Party) by attorneys and other professionals reasonably approved by the Indemnified Parties.

          Section 8.3. Changes in Laws Regarding Taxation. If any law is enacted or adopted or amended after the date of this Agreement which deducts the Debt from the value of the Property for the purpose of taxation or which imposes a tax, either directly or indirectly, on the Debt or Lender’s interest in the Property, Borrower will pay such tax, with interest and penalties thereon, if any.

ARTICLE IX WAIVERS

          Section 9.1. Waiver of Counterclaim. All amounts due under this Agreement or the other Loan Documents shall be payable without setoff or any deduction whatsoever.

          Section 9.2. Marshalling and Other Matters. Borrower hereby waives, to the maximum extent permitted by law, the benefit of all appraisement, valuation, stay, extension, reinstatement and redemption laws now or hereafter in force and all rights of marshalling in the event of any sale hereunder of the Property or any part thereof or any interest therein and the pleading of any statute of limitations as a defense to payment of the Debt or performance of the Obligations. Further, Borrower hereby expressly waives any and all rights of redemption from sale under any order or decree of foreclosure of the Security Instrument on behalf of Borrower, and on behalf of each and every Person acquiring any interest in or title to the Property subsequent to the date of this Agreement and on behalf of all Persons to the extent permitted by applicable law. Borrower hereby waives and renounces all homestead and exemption rights provided by the Constitution and the laws of the United States and of any state, in and to the Property as against the collection of the Debt, or any part thereof. As provided by Iowa Code 561.22, I understand that homestead property is in many cases protected from the claims of creditors and exempt from judicial sale; and that by signing this contract, I voluntarily give up the right to this protection for this property with respect to claims based on this contract. The interests and rights of Lender under the Note, the Security Instrument or in any of the other Loan Documents shall not be impaired by any indulgence, including (i) any renewal, extension or modification which Lender may grant with respect to any of the Debt, (ii) any surrender, compromise, release, renewal, extension, exchange or substitution which Lender may grant with respect to the Property or any portion thereof; or (iii) any release or indulgence granted to any maker, endorser, Obligor or surety of any of the Debt.

          Section 9.3. Waiver of Notice. Borrower shall not be entitled to, and hereby waives the right to receive, any notices of any nature whatsoever from Lender except with respect to matters for which this Agreement or the other Loan Documents specifically and expressly provide for the giving of notice by Lender to Borrower and except with respect to matters for which Borrower is not, pursuant to applicable Legal Requirements, permitted to waive the giving of notice.

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          Section 9.4. Trial by Jury. BORROWER HEREBY KNOWINGLY, WILLINGLY AND IRREVOCABLY WAIVES ITS RIGHTS TO DEMAND A JURY TRIAL IN ANY ACTION OR PROCEEDING INVOLVING THIS AGREEMENT OR LOAN DOCUMENTS. BORROWER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THE FOREGOING WAIVERS WITH ITS LEGAL COUNSEL AND HAS KNOWINGLY AND VOLUNTARILY WAIVED ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, THIS SECTION MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

ARTICLE X MISCELLANEOUS

          Section 10.1. Survival. This Agreement and all covenants, agreements, representations and warranties made herein and in the certificates delivered pursuant to any of the Loan Documents shall survive the making by Lender of the Loan and the execution and delivery to Lender of the Note, and shall continue in full force and effect so long as all or any of the Debt is outstanding and unpaid unless a longer period is expressly set forth herein or in the other Loan Documents. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the legal representatives, successors and assigns of such party. All covenants, promises and agreements in this Agreement, by or on behalf of Borrower, shall inure to the benefit of the legal representatives, successors and assigns of Lender.

          Section 10.2. Governing Law/Venue/Jurisdiction. THIS AGREEMENT SHALL BE GOVERNED BY, AND INTERPRETED AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF IOWA. Any action brought with respect to this Loan Agreement or any Loan Document shall be brought in the Iowa district court in the county where the real property is located. Borrower irrevocably submits itself to the jurisdiction of the state of Iowa and the Iowa district court in the county where the real property is located.

          Section 10.3. Modification; Waiver in Writing. No modification, amendment, extension, discharge, termination or waiver of any provision of this Agreement, or of any other Loan Document, nor consent by Lender to any departure by Borrower from the Obligations, shall in any event be effective unless the same shall be in a writing signed by the Person against whom enforcement is sought, and then such waiver or consent shall be effective only in the specific instance, and for the purpose, for which given. Except as otherwise expressly provided herein, no notice to, or demand on, Borrower shall entitle Borrower to any other or future notice or demand in the same, similar or other circumstances.

          Section 10.4. Delay Not a Waiver. Neither any failure nor any delay on the part of Lender in insisting upon strict performance or compliance of any term, condition, covenant or agreement, nor Lender’s delay in exercising any right, power, remedy or privilege hereunder, or under the Note or under any other Loan Document, or any other instrument given as security therefor, shall operate as or constitute a waiver thereof, nor shall a single or partial exercise thereof preclude any other future exercise, or the exercise of any other right, power, remedy or privilege. In particular, and not by way of limitation, by accepting payment after the due date of any amount payable under this Agreement, or any other Loan Document, Lender shall not be

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deemed to have waived any right either to require prompt payment when due of all other amounts due under this Agreement, or the other Loan Documents, or to declare a default for failure to effect prompt payment of any such other amount.

          Section 10.5. Notices. All notices, consents, approvals and requests required or permitted hereunder or under any other Loan Document shall be given in writing (including by facsimile) and shall be effective for all purposes if hand delivered or sent by (a) certified or registered United States mail, postage prepaid, (b) expedited prepaid delivery service, either commercial or United States Postal Service, with proof of attempted delivery, or (c) by facsimile (with a copy sent contemporaneously by certified or registered United States mail, postage prepaid, answer back acknowledged), addressed to the addresses in the first paragraph of this Agreement or at such other address and Person as shall be designated from time to time by any party hereto, as the case may be, in a written notice to the other parties hereto in the manner provided for in this Section. A notice shall be deemed to have been given: in the case of hand delivery, at the time of delivery; in the case of registered or certified mail, when delivered or the first attempted delivery on a Business Day; in the case of expedited prepaid delivery, upon the first attempted delivery on a Business Day, in the case of facsimile, upon completion of transmission (which is confirmed by telephone or by a statement generated by the transmitting machine) with receipt acknowledged by the recipient thereof.

          Section 10.6. Headings. The Article and/or Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose. “Section” refers to the entire section and not to any particular subsection, paragraph of other subdivision. Reference to days for performance shall mean calendar days unless Business Days are expressly indicated.

          Section 10.7. Severability. If any provision or obligation under this Agreement and the other Loan Documents shall be determined by a court of competent jurisdiction to be invalid, illegal or unenforceable, that provision shall be deemed severed from the Loan Documents and the validity, legality and enforceability of the remaining provisions or obligations shall remain in full force as though the invalid, illegal, or unenforceable provision had never been a part of the Loan Documents.

          Section 10.8. Expenses. Borrower covenants and agrees to pay to Lender upon receipt of written notice from Lender for all reasonable costs and expenses (including reasonable attorneys’ fees and disbursements) incurred by Lender in connection with (i) the preparation, negotiation, execution and delivery of this Agreement and the other Loan Documents and the consummation of the transactions contemplated hereby and thereby and all the costs of furnishing all opinions by counsel for the Borrower and Guarantor (including any opinions requested by Lender as to any legal matters arising under this Agreement or the other Loan Documents with respect to the Property); and (ii) the ongoing performance of and compliance with the respective agreements and covenants of the Obligors contained in this Agreement and the other Loan Documents. Any cost and expenses due and payable to Lender shall be payable within five (5) Business Days of demand, shall be secured by the Loan Documents, and if not paid when due, shall bear interest at the Default Rate until paid.

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          Section 10.9. Relationship of Borrower and Lender. The relationship between Borrower and Lender is solely that of debtor and creditor, and Lender has no fiduciary or other special relationship with Borrower, and no term or condition of any of the Note, the Security Instrument, this Agreement and the other Loan Documents shall be construed so as to deem the relationship between Borrower and Lender to be other than that of the debtor and creditor relationship established pursuant to the Loan Documents. The relationship of Borrower and Lender is created and governed solely by the Loan Documents.

          Section 10.10. No Joint Venture or Partnership. Lender, by making the Loan or taking any action pursuant to any of the Loan Documents, shall not be deemed a partner or a joint venturer with Borrower or fiduciary of Borrower.

          Section 10.11. Duplicate Originals; Counterparts. This Agreement may be executed in any number of duplicate originals and each duplicate original shall be deemed to be an original. This Agreement may be executed in several counterparts, each of which counterparts shall be deemed an original instrument and all of which together shall constitute one agreement. The failure of any party hereto to execute this Agreement, or any counterpart hereof, shall not relieve the other signatories from their obligations hereunder.

          Section 10.12. Liability. This Agreement shall be binding upon and inure to the benefit of the Obligors and Lender and their respective successors and assigns forever.

          Section 10.13. Prior Agreements. This Agreement and the other Loan Documents contain the entire agreement of the parties hereto and thereto in respect of the transactions contemplated hereby and thereby, and all prior agreements among or between such parties, whether oral or written, including any term sheets, discussion outlines or commitment letters (as same may be amended) between Obligors and Lender are superseded by the terms of this Agreement and the other Loan Documents.

          Section 10.14. Construction. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against Lender by virtue of the fact that this Agreement or any of the Loan Documents has originated with Lender as drafter.

          Section 10.15. Limitation on Liability. Notwithstanding anything contained herein to the contrary, Obligors specifically and explicitly waive their rights to any action against Lender, its parents, subsidiaries, assigns, or their agents or employees for special, consequential or punitive damages of any kind whatsoever whether arising in contract, tort (including claims that might involve negligence and strict liability) or any other legal or equitable principle arising from or in any way connected with this Loan, the Loan Agreement, or any other Loan Documents.

IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT.

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By signing below, the parties hereto acknowledge that it concurrently received of a copy of the documents and each document referenced herein.

          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized representatives, all as of the day and year first above written.

[Signature Pages Follow]

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Signature Page — Loan Agreement

BORROWER: SIR Park Place, LLC, an Iowa limited liability company by: Steadfast Income Advisor, LLC, its Manager
By:	/s/  James Kasim
	Name:	James Kasim
	Title:	Chief Financial Officer

STATE OF	)
	)	SS.
COUNTY OF	)

     This instrument was acknowledged before me on this ___ day of December, 2010 by ____________ as ___________ of Steadfast Income Advisor, LLC, the Manager of SIR Park Place, LLC.

[See Attached Certificate]                

Notary Public in and for the State of ______

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Signature Page — Loan Agreement

ACKNOWLEDGED AND APPROVED SUBJECT TO THE TERMS AND LIMITATIONS OF THAT CERTAIN GUARANTY OF EVEN DATE HEREWITH BY THE UNDERSIGNED GUARANTOR IN FAVOR OF LENDER, INCLUDING WITHOUT LIMITATION THE LIMIT OF ONE MILLION DOLLARS ON GUARANTOR’S LIABILITY:

GUARANTOR: Steadfast Income REIT, Inc.
By:	/s/  Rodney F. Emery
	Name:	Rodney F. Emery
	Title:	Chief Executive Officer

STATE OF	)
	)	SS.
COUNTY OF	)

     This instrument was acknowledged before me on this ___ day of December, 2010 by ____________ as ____________ of Steadfast Income REIT, Inc.

[See Attached Certificate]                

Notary Public in and for the State of ______

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Signature Page — Loan Agreement

LENDER: Ames Community Bank
By:	/s/  Jeff Harder
	Name:	Jeff Harder
	Title:	Vice President

STATE OF IOWA	)
	)	SS.
COUNTY OF POLK	)

     This instrument was acknowledged before me on this 20^th day of December, 2010 by Jeff Harder as Vice President of Ames Community Bank.

/s/  Teri Ruroden                                

Notary Public in and for the State of Iowa

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SCHEDULE I
Definitions

          “Acceptable Accounting Principles” shall mean GAAP or such other accounting methods or principles acceptable to Lender from time to time.

          “Access Laws” has the meaning set forth in Section 5.16.

          “Affiliate” shall mean as to any Person, (i) any Person that directly or indirectly through one or more intermediaries controls or is controlled by or is under common control with such Person, (ii) any Person (directly or indirectly) owning or controlling 10% or more of the outstanding voting securities of or other ownership interests in such Person, (iii) any officer, director, partner, employee or member (direct or indirect and no matter how remote) of such Person, (iv) if the such Person is an individual, any entity for which such Person directly or indirectly acts as an officer, director, partner, employee or member, or (v) any entity in which such Person (together with the members of his family if the Person in question is an individual) owns, directly or indirectly through one or more intermediaries an interest in any class of stock (or other beneficial interest in such entity) of 10% or more.

          “Affiliate Transaction” shall mean any contract, agreement or other arrangement between Borrower (or any other Person if such contract, agreement or other arrangement is in any way related to the Property) and Borrower or any Affiliate of Borrower or pursuant to which Borrower or any Affiliate of Borrower or any constituent member, partner or stockholder of Borrower or Borrower or any Affiliate of Borrower (direct or indirect) will receive any benefit of any kind.

          “Appraisal” shall mean the appraisal of the Property obtained by Lender prior to making the Loan.

          “Award” shall have the meaning set forth in Section 6.1.3(c).

          “Bankruptcy Code” shall mean Title 11 of the United States Code, as amended from time to time.

          “Borrower” shall mean the party indicated in the first paragraph of this Agreement as Borrower.

          “Business Day” shall mean a day on which Lender is open for business in the state of Iowa.

          “Casualty” shall mean the damage or destruction of any portion of the Property by fire or other casualty, whether insured or uninsured.

          “Casualty/Condemnation Involuntary Prepayments” shall have the meaning set forth in Section 2.2.

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          “Closing Date” shall mean the date of the funding of the Loan, but no later than December 22, 2010.

          “Code” shall mean the Internal Revenue Code of 1986, as amended, and as it may be further amended from time to time, any successor statutes thereto, and applicable U.S. Department of Treasury regulations issued pursuant thereto in temporary or final form.

          “Condemnation” shall have the meaning set forth in Section 6.1.3(a).

          “Condemnation Proceeds” shall mean any Award in respect of any Condemnation.

          “DSCR” shall have the meaning given to such term in Section 5.11(f).

          “Debt” shall mean the outstanding principal amount set forth in, and evidenced by, the Note together with all interest accrued and unpaid thereon, the Additional Interest, and all other sums due to Lender in respect of the Loan under the Note, this Agreement or any other Loan Document, as and if extended.

          “Default” shall mean the occurrence of any event under this Agreement or under any other Loan Document which, but for the giving of notice or the passage of time, or both, would be an Event of Default.

          “Default Rate” shall have the meaning set forth in the Note.

          “Enforcement Costs” shall mean any and all expenses, including legal expenses, attorneys’ fees and expert witness fees, (i) described in Section 7.4 of this Agreement, (ii) incurred or paid by Lender in protecting Lender’s interest in the Property, (iii) incurred in collecting any amount payable under this Agreement or the other Loan Documents, or (iv) incurred in enforcing Lender’s rights under this Agreement or the other Loan Documents or with respect to the Property, in each of clauses (i) through (iv) whether or not any legal proceeding is commenced hereunder or thereunder and whether or not any Default or Event of Default shall have occurred and is continuing, together with interest thereon at the Default Rate from the date paid or incurred by Lender until such amounts are repaid to Lender.

          “Environmental Indemnity” shall mean that certain Environmental Indemnity Agreement dated as of the date hereof, executed by Borrower in connection with the Loan for the benefit of Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

          “Environmental Laws” has the meaning set forth in the Environmental Indemnity.

          “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.

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          “Event of Default” shall have the meaning set forth in Section 7.1(a).

          “Financial Statements” shall mean a balance sheet, income statement and statement of changes in financial position prepared in accordance with Acceptable Accounting Principles, and setting forth all items of income and expense and such other information required under Acceptable Accounting Principles to fairly present the financial position and results of operation of Borrower, Guarantor, and the Property and which shall at a minimum be consistent in scope, form and content with such statements delivered to Lender prior to the Closing Date, and which are otherwise reasonably acceptable to Lender.

          “Fiscal Year” shall mean each twelve-month period commencing on January 1 and ending on December 31 during the term of the Loan.

          “GAAP” shall mean generally accepted accounting principles in the United States of America as of the date of the applicable financial report, consistently applied.

          “Governmental Authority” shall mean any court, board, agency, commission, office or authority of any nature whatsoever for any governmental unit (federal, state, county, district, municipal, city or otherwise) whether now or hereafter in existence.

          “Guarantor” shall mean Steadfast Income REIT, Inc.

          “Hazardous Substances” has the meaning set forth in the Environmental Indemnity.

          “Improvements” shall have the meaning set forth in the Security Instrument.

          “Indebtedness” of a Person, at a particular date, means the sum (without duplication) at such date of (a) all indebtedness or liability for borrowed money; (b) obligations evidenced by bonds, debentures, notes, or other similar instruments; (c) obligations for the deferred purchase price of property or services (including trade obligations); (d) obligations under letters of credit; (e) obligations under acceptance facilities; (f) all guaranties, endorsements (other than for collection or deposit in the ordinary course of business) and other contingent obligations to purchase, to provide funds for payment, to supply funds, to invest in any Person, or otherwise to assure a creditor against loss; and (g) obligations secured by any Liens, whether or not the obligations have been assumed.

          “Indemnified Parties” shall mean (a) Lender, (b) any prior or subsequent owner or holder of the Loan, (c) any receiver or other fiduciary appointed in a foreclosure or other proceeding, (d) any officers, directors, shareholders, partners, members, employees, agents, servants, representatives, contractors, subcontractors, affiliates or subsidiaries of any and all of the foregoing, and (e) the heirs, legal representatives, successors and assigns of any and all of the foregoing (including any successors by merger, consolidation or acquisition of all or a substantial portion of the Indemnified Parties’ assets and business), in all cases whether during the term of the Loan or thereafter or as part of or following a foreclosure of the Loan.

          “Insurance Premiums” shall have the meaning set forth in Section 6.1.1(b).

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          “Insurance Proceeds” shall mean all proceeds received under Policies required to be maintained by Borrower.

          “Lease” shall mean any lease, occupancy agreement, sublease, sub-sublease, letting, license, concession or other agreement (whether written or oral and whether now or hereafter in effect) pursuant to which any Person is granted a possessory interest in, or right to use or occupy all or any portion of, any space in the Property.

          “Legal Requirements” shall mean all federal, state, county, municipal and other governmental statutes, laws, rules, orders, regulations, ordinances, judgments, decrees and injunctions of Governmental Authorities affecting the Property or any part thereof or the construction, use, alteration or operation thereof, or any part thereof, whether now or hereafter enacted and in force, and all permits, Licenses and authorizations and regulations relating thereto, and all covenants, agreements, restrictions and encumbrances contained in any instruments, either of record or known to Borrower, at any time in force affecting the Property or any part thereof, including (i) Access Laws, (ii) applicable restrictive covenants, zoning ordinances and building codes, (iii) subdivision and land use laws and regulations, (iv) all applicable health and Environmental Laws and regulations, and (v) all standards and regulations of appropriate supervising boards of fire underwriters and similar agencies.

          “Lender” shall mean Ames Community Bank, together with its successors and assigns.

          “Licenses” shall mean all necessary certificates, licenses and other approvals, governmental and otherwise, and all required zoning, building code, land use, environmental and other similar permits or approvals, including certificates of completion and certificates of occupancy, necessary for the operation of the Property for its current and intended uses and for the conduct of Borrower’s business.

          “Lien” shall mean any mortgage, deed of trust, lien, pledge, hypothecation, assignment, security interest, or any other encumbrance, charge or transfer of, on or affecting the Property or any portion thereof, or any interest of Borrower therein, including any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, the filing of any financing statement, and mechanic’s or materialmen’s liens and other similar liens and encumbrances.

          “Loan” shall mean the loan made by Lender to Borrower in the original principal amount set forth in, and evidenced by, the Note executed and delivered by Borrower.

          “Loan Documents” shall mean, collectively, this Agreement, the Environmental Indemnity, the Security Instrument, the Note, the Guaranty, the Uniform Commercial Code financing statements, and all other documents evidencing, securing or otherwise executed and/or delivered by Obligors in connection with the Loan. Each of the Loan Documents may be referred to herein individually as a “Loan Document.”

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           “Losses” shall mean any and all claims, suits, liabilities (including strict liabilities), actions, proceedings, obligations, debts, damages, losses, costs (including any and all costs and expenses incurred in the preservation, restoration and protection of the Property and any and all costs and expenses incurred by Lender), any deficiency claim in connection with the foreclosure of the Security Instrument, expenses, diminution in value of the Property, fines, penalties, charges, fees, judgments, awards, amounts paid in settlement, punitive damages, foreseeable consequential damages, and damages and expenses of whatever kind or nature (including but not limited to reasonable attorneys’ fees and other costs of defense), including Enforcement Costs or any other amounts expended by Lender in connection with the Loan.

          “Material Adverse Effect” shall mean a material adverse effect on (i) the assets, operations, or financial condition of any Obligor, (ii) the ability to pay the Debt of Borrower in accordance with the terms hereof and otherwise comply with the material terms of this Agreement and the Loan Documents, (iii) the value of the Property, (iv) the validity, priority or enforceability of this Agreement or any other Loan Document, (v) the ability of Lender to enforce its rights and remedies pursuant to this Agreement or any other Loan Documents, (vi) Lender’s Lien on the Property or the priority of such Lien, or (vii) the Loan.

          “Maturity Date” shall have the meaning set forth in the Note.

          “Note” shall mean that certain Promissory Note dated as of the date hereof, made by Borrower in favor of Lender, as the same may be amended, restated, extended, replaced, supplemented or otherwise modified from time to time.

          “Obligors” shall mean the collective reference to Borrower and Guarantor and any other Person (other than Lender) that is a party to any of the Loan Documents, other than any Property Manager that is not an Affiliate of Borrower. Individually, each of the Obligors may be referred to herein as a “Obligor.”

          “Obligations” shall mean any and all debt, liabilities and other obligations of Obligors, including all affirmative and negative covenants, to Lender or of any of the Borrower in connection with the Loan or pursuant to the Loan Documents, including, without limiting the generality of the foregoing, the Debt.

          “Other Charges” shall mean all maintenance charges, charges or amounts payable under any reciprocal easement agreement, condominium declaration, association by-laws, ground rents, impositions other than Taxes, and any other charges (including any charges, payments or amounts, for which the failure to pay may give rise to a Lien against the Property), now or hereafter levied or assessed or imposed against the Property or any part thereof.

          “Permitted Encumbrances” shall mean, with respect to the Property, collectively: (a) the Liens created by the Loan Documents, (b) all Liens, encumbrances and other matters disclosed in the Title Opinion of Counsel relating to the Property or any part thereof which have been approved by Lender, (c) Liens, if any, for Taxes imposed by any Governmental Authority not yet due or delinquent, (d) statutory Liens for labor or materials securing sums not yet due and payable, provided Borrower has given advance written notice of

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same to Lender and Lender has approved of such expenditures, and (e) the matters revealed by the Surveys.

          “Permitted Use” shall be sale and or lease of residential condominium units in the Premises, and lease of adjacent parking lot.

          “Person” shall mean any individual, entity, corporation, partnership, limited liability company, joint venture, estate, trust, unincorporated association, any federal, state, county or municipal government or any bureau, department or agency thereof and any fiduciary acting in such capacity on behalf of any of the foregoing.

          “Policies” or “Policy” shall have the respective meanings specified in Section 6.1.1(b).

          “Premises” shall have the meaning set forth in the granting clause of the Security Instrument with respect to the Property.

          “Property” shall have the meaning set forth in the granting clause of the Security Instrument.

          “Property Management Agreement” shall mean any property management agreement, which must be acceptable to Lender, entered into by and between Borrower and the Property Manager.

          “Property Manager” shall mean such property manager selected by the Borrower and approved by Lender in accordance with this Agreement.

          “Real Property” shall mean that real property legally described in the Security Instrument owned by Borrower.

          “Rent(s)” shall mean all rents (including fixed minimum rent and percentage rent), rent equivalents, moneys payable as damages or in lieu of rent or rent equivalents, royalties (including all oil and gas or other mineral royalties and bonuses), income, receivables, receipts, expense reimbursements and recoveries (including all assignment fees, consent fees, surrender fees, termination fees and the lessor’s share (or the share of any Affiliate of Borrower) of any profits from any Tenant subletting or assignment) from Tenants, revenues, deposits (including security, utility and other deposits), accounts, cash, issues, fees, profits, charges for services rendered, and other consideration of whatever form or nature received by or paid to or for the account of or benefit of Borrower or its agents or employees from any and all sources whether or not arising from or attributable to the Property, and proceeds, if any, from business interruption or other loss of income insurance, together with all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Debt and all right, title and interest of Borrower, its successors and assigns therein and thereunder, including all guarantees, cash or securities deposited under the Leases to secure the performance by the Tenants of their obligations thereunder and all rents, additional rents, revenues, issues and profits (including all oil and gas or other mineral royalties and bonuses) from the Premises and the Improvements whether paid or accruing before or after the filing by or against Borrower of any

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petition for relief under the Bankruptcy Code and all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Debt.

          “Restoration” shall have the meaning set forth in Section 6.1.2(a).

          “Scheduled Payment Date” shall have the meaning set forth in the Note or, if not set forth in the Note, the first day of each calendar month, or if such first day is not a Business Day, the next Business Day.

          “Security Instrument” shall mean that certain first priority Mortgage, Assignment of Leases and Rents, Security Instrument and Fixture Financing Statement, dated as of the date hereof, executed and delivered by Borrower as security for the Loan made to Borrower and encumbering the Property, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

          “Service Rights” shall mean any agreements, contracts, rights, licenses or other interests of any type (whether exclusive or non-exclusive) granted or given to any Person to provide any products or services to or for or with respect to the Property, any Tenant or any occupants of the Property, including any of the same related to telecommunications, internet products or services, including, but not limited to, personal computer hardware and software, internet hardware and software, internet access services, printers, video display systems, audio sound systems and communication telephonic devices, as well as related and complementary products and services and any substitutes for, and items that are a technological evolution of, any of the foregoing products.

          “Surveys” shall mean the ALTA Surveys performed by Kess & Associates, Inc. in connection with Borrower’s purchase of the Real Property from Park Place Condo, LLC.

          “Tax Escrow Fund” shall have the meaning set forth in Section 6.2.

          “Taxes” shall mean all real estate and personal property taxes, assessments, water rates or sewer rents now or hereafter levied or assessed or imposed against the Property or any part thereof, including (a) any ad valorem real or tangible personal property taxes levied against the Property and (b) any intangible personal property tax levied or imposed on Lender with respect to its ownership in the Loan.

          “Tenant” shall mean each Person granted a possessory interest or right to use or occupy all or any portion of the Property pursuant to a Lease or rental agreement.

          “Term” shall have the meaning set forth in Section 6.1.1(a).

          “Transfer” shall mean any sale, assignment, conveyance, alienation, mortgage, encumbrance, pledge, hypothecation or other transfer, including any swap, derivative or other transaction shifting the risks and rewards of ownership, whether voluntary or involuntary.

          “UCC” shall mean the Uniform Commercial Code of Iowa.

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          “UCC Financing Statement” shall mean a financing statement as defined by and in accordance with the requirements of the UCC.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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SCHEDULE II
Conditions Precedent

          Each of the following shall be satisfied, on or before December 22, 2010, by Borrower as a condition precedent to the making of the Loan, and shall represent continuing covenants of Borrower after the Closing Date.

               (a) Representations and Warranties; Compliance with Conditions. The representations and warranties of Borrower contained in this Agreement and the other Loan Documents shall be true and correct in all material respects on and as of the Closing Date and no Material Adverse Effect has occurred and no Default or Event of Default shall have occurred and be continuing; and Borrower shall be in compliance in all material respects with all terms and conditions set forth in this Agreement and in each other Loan Document on their part to be observed or performed.

               (b) Delivery of Loan Documents; Reports.

               (i) Note, Loan Agreement, Security Instrument, and other Loan Documents. Lender shall have received from Borrower fully executed (and acknowledged if required) counterparts of the Note and all other Loan Documents and evidence that counterparts of the Security Instrument has been delivered to the appropriate recording office for recording, so as to effectively create upon such recording valid and enforceable first priority Liens upon the Property, in favor of Lender, subject only to the Permitted Encumbrances.

               (ii) UCCs. Lender shall have received from Borrower (i) such UCC Financing Statements as Lender shall require, executed by Borrower and all other appropriate Persons and such financing statements shall have been filed of record in the appropriate filing offices required by Lender for filing so as to effectively create upon such filing a valid and enforceable first priority Lien on the Property in favor of Lender, subject only to the Permitted Encumbrances and (ii) a list of the principal places of business, tax identification numbers, and doing business names for the Borrower and all other information as Lender may require to properly file such UCC Financing Statements, all certified by the Borrower.

               (iii) Title Opinion. Lender shall have received a Title Opinion dated as of the Closing Date acceptable to Lender.

               (iv) Insurance. Lender shall have received valid certificates of insurance for all Policies required hereunder or under any of the Loan Documents.

               (v) Encumbrances. Borrower shall have taken or caused to be taken such actions in such a manner so that Lender has a valid and perfected first Lien as of the Closing Date on the Property, subject only to applicable Permitted Encumbrances and such other Liens as are permitted pursuant to the Loan Documents.

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               (c) Delivery of Organizational Documents; Consents. Borrower shall have delivered or caused to be delivered to Lender certified copies of all organizational documents related to the Borrower and Guarantor.

               (d) Opinions of Borrower’s and Guarantor’s Counsel. Lender shall have received opinions of counsel to the Borrower and Guarantor with respect to due execution and authority, of the Loan Documents, such opinions to be in form, scope and substance satisfactory to Lender and Lender’s counsel.

               (e) Taxes, Insurance Premiums and Other Charges. Borrower shall have paid all Taxes, Insurance Premiums and Other Charges relating to the Property which are due and payable or in arrears.

               (f) Intentionally deleted.

               (g) Appraisal. Lender shall have received at Borrower’s sole cost and expense an appraisal from an appraiser acceptable and certified to Lender establishing the value of the Property.

               (h) Environmental Report. Lender shall have received an environmental report acceptable to Lender that there are no adverse environmental conditions on the Property.

               (i) Further Documents. Lender or its counsel shall have received such other and further approvals, opinions, documents and information as Lender or its counsel may have reasonably requested in form and substance satisfactory to Lender and its counsel.

               (j) Minimum Cash Contribution. Borrower shall contribute at closing at least $3,050,000 in cash toward the acquisition of the Property

               (k) Payment of Loan Origination Fee. Borrower shall pay a loan origination fee in the amount of .75% of the principal amount of the Note.

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EX-10.2

Exhibit 10.2

PROMISSORY NOTE

$5,000,000.00 Date: December 22, 2010     

          FOR VALUE RECEIVED, SIR Park Place, LLC, an Iowa limited liability company, with offices at 18100 Von Karman Avenue, Suite 500, Irvine, California (“Borrower”), absolutely and unconditionally promises to pay to the order of Ames Community Bank, with offices at 925 Gateway Drive, Grimes, Iowa 50111 (“Lender”), the principal sum of FIVE MILLION AND NO/100’s DOLLARS ($5,000,000.00), with interest on the unpaid principal balance to be computed from the date of this Promissory Note (this “Note”) at the Applicable Interest Rate (as defined below), in lawful money of the United States of America, in immediately available funds, which shall at the time of payment be legal tender for payment of all debts and dues, public and private.

     1. PAYMENTS.

          1.1. Payments. The principal, interest and all other sums due under this Note shall be payable at the office of Lender as set forth above, or at such other place as Lender may from time to time designate in writing, as follows: Commencing on January 1, 2011 (“First Payment Date”), and on the first day of each month thereafter (each a “Scheduled Payment Date”) until the Maturity Date, Borrower shall make interest only payments at the Applicable Interest Rate in the amount of all interest accrued during the immediately preceding calendar month.

               (a) All amounts due under this Note shall be payable without setoff, counterclaim or any other deduction whatsoever.

               (b) Additionally, payments shall be made on this Note as provided by the Loan Agreement and the other Loan Documents.

               (c) Unless extended pursuant to the provisions of this Note, the entire outstanding principal balance of this Note, together with accrued and unpaid interest and any other amounts due under this Note including all accrued interest and all other payment Obligations of Borrower shall become due on December 31, 2013 (the “Maturity Date”).

          1.2. Applicable Interest Rate. Interest shall be fixed at 5.25% per annum, except that during any extension period the interest rate shall be as set forth in Section 7.2(a) below.

     NOTICE: UNDER NO CIRCUMSTANCES WILL THE INTEREST RATE ON THIS NOTE BE MORE THAN THE MAXIMUM RATE ALLOWED BY APPLICABLE LAW. In the event any rate change would result in a rate which would violate applicable law, the interest rate shall be adjusted to equal the highest rate allowed by applicable law. Borrower represents and warrants that this transaction is exempt from the usury laws of the State of Iowa, and intends Lender to rely upon this representation.

          1.3 Computation. Interest on the principal sum of this Note shall be calculated on the basis of a 360-day year.

          1.4 Determination. Payments under this Note or any other Loan Document shall be made in federal funds immediately available in the place designated for payment which must be received by Lender prior to 2:00 p.m. local time at said place of payment. Payments so made shall be considered by Lender as having been received prior to close of business, while other payments may, at the option of Lender, not be credited until immediately available to Lender in federal funds in the place designated for payment prior to 2:00 p.m. local time at said place of payment on a day on which Lender is open for business.

          1.5 Making of Payments. Each payment by Borrower hereunder or under the Loan Agreement or any other Loan Document shall be made in funds immediately available to Lender on the date such payment is due from such Borrower to Lender, without presentment, demand, protest or notice of any kind, all such notices being hereby waived and without setoff, counterclaim or other deduction of any nature. Whenever any payment hereunder or under the Loan Agreement or any other Loan Document shall be stated to be due on a day which is not a Business Day such payment shall be made on the next following Business Day.

          1.6 Application. Payments under this Note shall be applied first to the payment of late fees and other costs and charges due in connection with this Note or the other Loan Documents, as Lender determines in its sole discretion, then to the payment of accrued but unpaid interest, and then to reduction of the outstanding principal balance (in inverse order of maturity whether or not then due).

          1.7. Definitions. All capitalized terms used in this Note without definition shall have the meanings assigned to such terms in the Loan Documents, all of the terms of such Loan Documents being hereby incorporated into and made part of this Note by reference for all purposes. Additionally, for purposes of this Note, the following terms shall have the following meanings:

          “Default Rate” has the meaning given thereto in Section 2.4.

          “Interest Accrual Period” means the calendar month.

          “Loan Agreement” means that certain Loan Agreement dated as of even date herewith between Borrower and Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

     2 DEFAULT.

          2.1 Late Fee. If any sum payable under this Note or any other Loan Document is not paid on or before the fifth (5th) day after the date due, Borrower shall pay a Late Fee of five percent (5%) of the payment due that shall be added to the amount of principal and interest due with each such late payment. The parties acknowledge and agree that the Late Fee is not a penalty but is intended to defray costs and expenses incurred by Lender in connection with each such late payment. If the amount noted herein is prohibited or restricted by Legal Requirements, the maximum amount permitted by applicable law to defray the expenses

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incurred by Lender in handling and processing such delinquent payment and to compensate Lender for the loss of the use of such delinquent payment and such amount shall be added to each such payment and shall be secured by the Security Instrument and the other Loan Documents.

          2.2 Remedies. Upon the commencement of an Event of Default, the entire outstanding principal sum of this Note, together with all interest accrued and unpaid thereon and all other sums due under this Note, the Security Instrument or any of the other Loan Documents, or any portion thereof shall without notice become immediately due and payable at the option of Lender upon the occurrence of any Event of Default as defined in the Loan Agreement or in any of the Loan Documents. Time is of the essence in this Note, the Security Instrument and the other Loan Documents. If Borrower’s obligations under this Note or any of the other Loan Documents to which it is a party are enforced by Lender through an attorney-at-law, or any payment due under this Note or the other Loan Documents is collected by or through an attorney-at-law or collection agency, Borrower agrees to pay all costs incurred by Lender in connection therewith, including, but not limited to, internal administrative costs, reasonable attorneys’ fees and disbursements (whether with respect to a retained firm or, to the extent permitted by applicable law, Lender’s in-house staff), collection agency costs, whether or not suit be brought, and any and all costs or fees arising as a result of the filing of or during the course of any case under any Bankruptcy Laws (as defined in the Loan Agreement) with respect to any of the Borrower Parties.

          2.3. Copy of Note. If a copy of this Note, verified by an affidavit, shall be filed in any proceeding, it will not be necessary to file the original. Borrower waives the right to any stay of execution and the benefit of all exemption laws now or hereafter in effect.

          2.4 Default Rate. Upon the occurrence of an Event of Default, Lender shall be entitled to receive, and Borrower shall pay interest on, the entire unpaid principal sum at the rate of 10% per annum (the “Default Rate”) on all amounts due to Lender from Borrower pursuant to this Note. The Default Rate shall be automatically computed from the occurrence of the Event of Default and shall remain in effect until the actual receipt and collection of this Note in full has been accomplished and all other amounts due to Lender from Borrower pursuant to this Note or other Loan Documents have been fully paid or, if permitted by Lender, the date upon which such Event of Default is cured. This charge shall be added to this Note, and shall be deemed secured by the Security Instrument and the other Loan Documents. This clause, however, shall not be construed as an agreement or privilege to extend the date of any payment due pursuant to this Note including, but not limited to, the Maturity Date, or to the payment of any other sums payable under the Loan Documents, nor as a waiver of any other right or remedy accruing to Lender by reason of the occurrence of any Event of Default. In the event the Default Rate would otherwise exceed the maximum rate permitted by applicable law, the Default Rate shall be the maximum rate permitted by applicable law.

          2.5 Post-Judgment. Interest shall accrue on any judgment obtained by Lender in connection with the enforcement or collection of this Note or the other Loan Documents (including foreclosure of the Security Instrument) until such judgment amount is irrevocably paid in full at a rate equal to the greater of (a) the Default Rate or (b) the highest legal rate applicable to judgments within such jurisdiction; provided, however, that interest shall not accrue

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at a rate in excess of the maximum rate of interest, if any, which may be charged by Lender or collected from any Borrower under applicable law.

     3 REMEDIES CUMULATIVE. THE REMEDIES AVAILABLE TO LENDER UNDER THIS NOTE AND IN THE OTHER LOAN DOCUMENTS, OR AT LAW OR IN EQUITY, SHALL BE CUMULATIVE AND CONCURRENT, AND MAY BE PURSUED SINGLY, SUCCESSIVELY OR TOGETHER IN LENDER’S SOLE DISCRETION AND AS OFTEN AS OCCASION THEREFOR SHALL ARISE EXCEPT AS PROVIDED IN THE LOAN AGREEMENT.

     4 PREPAYMENT. Borrower may prepay without penalty all or a portion of the amount owed earlier than it is due. Early payments may reduce the principal balance and the amount of interest due. Borrower shall have sole discretion to direct how any early payments are applied, provided that Borrower is current on all interest payments.

     5 SECURITY. The indebtedness evidenced by this Note is governed by the Loan Agreement and the obligations created thereby (including without limitation the amounts authorized by Section 2 to be collected by Lender) are secured by, among other things, the Security Instrument and other Loan Documents.

     6 GENERAL

          6.1 Written Amendment Only. This Note may not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or failure to act on the part of Borrower or Lender, but only by an agreement in writing signed by the Borrower and Lender.

          6.2 Certain Waivers. Except for any notices specifically required by the Loan Agreement, Borrower and all others who may become liable for the payment of all or any part of the Debt do hereby severally waive presentment and demand for payment, notice of dishonor, protest and notice of protest, notice of non-payment and notice of intent to accelerate the maturity hereof (and of such acceleration). No release of any security for the Loan or extension of time for payment of this Note or any installment hereof, and no alteration, amendment or waiver of any provision of this Note or the other Loan Documents made by agreement between Lender and any Person other than Borrower shall release, modify, amend, waive, extend, change, discharge, terminate or affect the liability of Borrower, or any other Person who may become liable for the payment of all or any part of the Debt, under this Note and the other Loan Documents. Lender may release any guarantor or indemnitor of the Loan from liability, in every instance without the consent of the Borrower hereunder, and without waiving any rights the Lender may have hereunder, under the other Loan Documents.

          6.3 Severability. If any provision or obligation under this Note and the other Loan Documents shall be determined by a court of competent jurisdiction to be invalid, illegal or unenforceable, that provision or obligation shall be deemed severed from the Loan Documents

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and the validity, legality and enforceability of the remaining provisions or obligations shall remain in full force as though the invalid, illegal, or unenforceable provision or obligation had never been a part of the Loan Documents.

          6.4 Notices. All notices or other written communications hereunder shall be given and become effective as provided in the Loan Agreement.

          6.5 Set-Off Preference. Except as expressly provided to the contrary in this Note or the Loan Documents, Borrower is and shall be obligated to pay principal, interest and any and all other amounts for which such Borrower is liable which become payable hereunder or under the other Loan Documents absolutely and unconditionally and without any abatement, postponement, diminution or deduction and without any reduction for counterclaim or setoff. In the event that at any time any payment received by Lender hereunder shall be deemed by a court of competent jurisdiction to have been a voidable preference or fraudulent conveyance under any bankruptcy, insolvency or other debtor relief law, then the obligation to make such payment shall survive any cancellation or satisfaction of this Note or return thereof to Borrower and shall not be discharged or satisfied with any prior payment thereof or cancellation of this Note, but shall remain a valid and binding obligation enforceable in accordance with the terms and provisions hereof, and such payment shall be immediately due and payable upon demand.

          6.6 Successors and Assigns. The terms and provisions hereof shall be binding upon, and inure to the benefit of, Borrower and Lender and their respective heirs, executors, legal representatives, successors, successors-in-title and permitted assigns, whether by voluntary action of the parties or by operation of law. As used in this Note and the other Loan Documents, the terms “Borrower” and “Lender” shall be deemed to include their respective heirs, executors, legal representatives, successors, successors-in-title and permitted assigns (no right to assign on the part of Borrower being implied hereby), whether by voluntary action of the parties or by operation of law.

          6.7 Interpretation. All references to sections, schedules and exhibits are to sections, schedules and exhibits in or to this Note unless otherwise specified. Unless otherwise specified, the words “hereof,” “herein” and “hereunder” and words of similar import when used in this Note shall refer to this Note as a whole and not to any particular provision of this Note. Unless otherwise specified, all meanings attributed to defined terms herein shall be equally applicable to both the singular and plural forms of the terms so defined and “including” means including without limitation. Whenever the context requires, each gender shall include all other genders.

          6.8 Waiver of Claims/Trial by Jury. BORROWER HEREBY RELEASES ANY CLAIM AGAINST LENDER AS SET FORTH IN THE LOAN DOCUMENTS. FURTHER, EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING UNDER THE LOAN DOCUMENTS, INCLUDING, WITHOUT LIMITATION, ANY PRESENT OR FUTURE MODIFICATION THEREOF OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THE LOAN DOCUMENTS (AS NOW OR HEREAFTER MODIFIED) OR ANY OTHER INSTRUMENT, DOCUMENT OR

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AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION IS NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF ANY RIGHT THEY MIGHT OTHERWISE HAVE TO TRIAL BY JURY.

          6.9 GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY, AND INTERPRETED AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF IOWA

          6.10 VENUE/JURISDICTION. ANY ACTION BETWEEN THE PARTIES SHALL BE COMMENCED AND SHALL BE UNDERTAKEN IN THE IOWA DISTRICT COURT WHERE THE PROPERTY THAT IS THE SUBJECT OF THE SECURITY INTEREST IS LOCATED AND EACH PARTY HEREBY SUBMITS ITSELF TO THE JURISDICTION OF SAID COURT.

          6.11 COUNTERPARTS. This Note may be executed in any number of counterparts, each of which shall be an original, but all of which shall constitute one and the same instrument.

     7 EXTENSION OPTIONS. Lender grants Borrower two (2) options to extend the Maturity Date of this Note for successive periods of one (1) year each, upon and subject to the terms and conditions in this Section 7. In the event of such extension, the date as so extended shall be deemed the “Maturity Date.”

          7.1 Basic Conditions. Unless otherwise agreed by Lender in writing,

          (a) Borrower shall exercise an extension, if at all, by written notice to Lender not less than ten (10) days prior to the Maturity Date.

          (b) At the time of the request, and at the time of the extension, there shall not exist any Event of Default, nor any condition or state of facts which after notice and/or lapse of time would constitute an Event of Default under any Loan Document.

          (c) Whether or not the extension becomes effective, Borrower shall pay all out-of-pocket costs and expenses incurred by Lender in connection with the proposed extension (pre- and post-closing), including, without limitation, appraisal fees, environmental audit and legal fees; all such costs and expenses incurred up to the time of Lender’s written agreement to the extension shall be due and payable prior to Lender’s execution of that agreement (or if the proposed extension does not become effective, then upon demand by Lender), and any future failure to pay such amounts shall constitute a default under the Loan Documents.

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          (d) Borrower shall satisfy all applicable regulatory requirements, including appraisal requirements, with respect to the extension.

          (e) Lender shall have been provided with an updated Title Opinion on the Property

          (f) Borrower shall have paid to Lender a non-refundable extension fee in an amount equal to. 25% of the then outstanding principal balance hereunder.

          If all of the foregoing conditions are not satisfied strictly in accordance with their terms, the extension shall not be or become effective.

          7.2 Changes in Loan Terms. All terms and conditions of the Loan Documents shall continue to apply to the extended term except to the extent changed as indicated below (such changes to be effective on and after the original Maturity Date, if the extension becomes effective as provided herein):

          (a) Interest Rate. The Applicable Interest Rate shall adjust on the first day such extension period becomes effective (i.e., on December 31, 2013 and December 31, 2014), to a rate which is then equal to the One-Year Federal Home Loan Bank of Des Moines rate plus 3.75%, provided, however, such interest rate shall never be below 5.0% or above 6.5%.

          (b) Payments. Commencing on the effective date of the first extension period, until the Maturity Date, Borrower shall make payments of principal and accrued interest at the Applicable Interest Rate, with principal being amortized on a 30 year basis, and with all principal and accrued interest due and payable in full on the Maturity Date.

IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS NOTE SHOULD BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED. YOU MAY CHANGE THE TERMS OF THIS NOTE ONLY BY ANOTHER WRITTEN AGREEMENT.

By signing below, the parties hereto acknowledge that it concurrently received of a copy of the documents and each document referenced herein.

          IN WITNESS WHEREOF, Borrower has duly executed this Note the day and year first above written.

[Signature Pages Follow]

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Signature Page — Promissory Note

BORROWER: SIR Park Place, LLC, an Iowa limited liability company by: Steadfast Income Advisor, LLC, its Manager
By:	/s/  James Kasim
	Name:	James Kasim
	Title:	Chief Financial Officer

STATE OF _____________	)
	) SS.
COUNTY OF _________	)

     This instrument was acknowledged before me on this ___ day of December, 2010 by ____________ as ____________ of Steadfast Income Advisor, LLC, the Manager of SIR Park Place, LLC.

[See Attached Certificate]                

Notary Public in and for the State of ______

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ACKNOWLEDGED AND APPROVED SUBJECT TO THE TERMS AND LIMITATIONS OF THAT CERTAIN GUARANTY OF EVEN DATE HEREWITH BY THE UNDERSIGNED GUARANTOR IN FAVOR OF LENDER, INCLUDING WITHOUT LIMITATION THE LIMIT ON GUARANTOR’S LIABILITY OF THE LESSER OF ONE MILLION DOLLARS OR THE GUARANTEED PAYMENT:

GUARANTOR: Steadfast Income REIT, Inc.
By:	/s/  Rodney F. Emery
	Name:	Rodney F. Emery
	Title:	Chief Executive Officer

STATE OF _____________	)
	) SS.
COUNTY OF _________	)

     This instrument was acknowledged before me on this ___ day of December, 2010 by ____________ as ____________ of Steadfast Income REIT, Inc.

[See Attached Certificate]                

Notary Public in and for the State of ______

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EX-10.3

Exhibit 10.3

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND
FIXTURE FINANCING STATEMENT

Preparer Information: Thomas L. Flynn, Belin McCormick, P.C., 666 Walnut Street, Ste. 2000, Des Moines, Iowa 50309; 515-283-4605

Taxpayer Information: SIR Park Place, LLC, 18100 Von Karman Avenue, Suite 500, Irvine, California

Return Document To: Thomas L. Flynn, Belin McCormick, P.C., 666 Walnut Street, Ste. 2000, Des Moines, Iowa 50309; 515-283-4605

Mortgagor:	Mortgagee:
SIR Park Place, LLC	Ames Community Bank

Legal Description: See Exhibit A on Page 18.

Document or instrument number of previously recorded documents: N/A.

NOTE: This cover page is prepared in compliance with Iowa Code Section 331.606B, (2009). This cover page is provided for information purposes only.

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND
FIXTURE FINANCING STATEMENT

          THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT (the “Security Instrument”) is made as of the 22nd day of December, 2010, by SIR Park Place, LLC, an Iowa limited liability company, with offices at 18100 Von Karman Avenue, Suite 500, Irvine, California (“Borrower”), for the benefit of Ames Community Bank as beneficiary, with offices at 925 Gateway Drive, Grimes, Iowa 50111 (“Lender”).

This Security Instrument encumbers both real and personal property, contains an after-acquired property clause and secures present and future loans and advances.

NOTICE: This Mortgage secures credit in the amount of $5,000,000.00. Loans and advances up to this amount, together with interest are senior to indebtedness to other creditors under subsequently recorded or filed mortgages and liens.

RECITALS:

          This Security Instrument is given in connection with that certain Loan Agreement, of even date herewith, between the Borrower and the Lender (as such agreements may be amended, modified or restated, collectively the “Loan Agreement”) in connection with a loan (the “Loan”) from Lender in the principal amount of $5,000,000, which matures on December 31, 2013, with two (2) possible one year extensions to December 31, 2014 and December 31, 2015.

          Borrower desires to secure the payment of the Debt (hereinafter defined) and the performance of all of Borrower’s obligations under the Note and the other Loan Documents. Capitalized terms used, but not defined, herein shall have the meanings given to such terms in the Loan Agreement.

ARTICLE I. GRANTS OF SECURITY

Section 1.01 Property Mortgaged and Security Interest Granted. Borrower does hereby irrevocably (i) mortgage, grant, bargain, sell, pledge, assign, warrant, transfer and convey, and (ii) grant a Security Interest to Lender the following property, rights, interests and estates now owned, or hereafter acquired by Borrower (collectively, the “Property”):

(a)	Premises. The real property described in Exhibit A attached hereto and made a part hereof (the “Premises” or the “Real Property”);
(b)	Additional Land. All additional lands, estates and development rights hereafter acquired by Borrower for use in connection with the Premises and the development of the

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Premises that may, from time to time, by supplemental security instrument or otherwise be expressly made subject to the Lien of this Security Instrument;

(c)	Improvements. All buildings, structures, fixtures, additions, enlargements, extensions, modifications, repairs, replacements and improvements now or hereafter erected or located on the Premises, including, but not limited to, all apparatus, equipment, and appliances used in the operation or occupancy of the real property described above, it being intended by the parties that all such items shall be conclusively considered to be a part of the Premises, whether or not attached or affixed to the Premises (the “Improvements”); together with all mineral, oil and gas and other hydrocarbon substances in, on or under the Premises;
(d)	After Acquired Property. All property acquired by Borrower after the date of this Security Instrument for use in connection with the Premises which by the terms of this Security Instrument shall be subject to the Lien and/or the security interest created hereby, shall immediately upon the acquisition thereof by Borrower and without any further mortgage, conveyance or assignment become subject to the Lien and security interest created by this Security Instrument;
(e)	Easements. All easements, rights-of-way or use, rights, strips and gores of land, streets, ways, alleys, passages, sewer rights, water, water courses, water rights and powers, air rights and development rights and credits, and all estates, rights, titles, interests, privileges, liberties, servitudes, tenements, hereditaments and appurtenances of any nature whatsoever, in any way now or hereafter belonging, relating or pertaining to the Premises and the Improvements and the reversion and reversions, remainder and remainders, and all land lying in the bed of any street, road or avenue, opened or proposed, in front of or adjoining the Premises, to the center line thereof and all the estates, rights, titles, interests, dower and rights of dower, curtesy and rights of curtesy, property, possession, claim and demand whatsoever, both at law and in equity, of Borrower of, in and to the Premises and the Improvements and every part and parcel thereof, with the appurtenances thereto; and all interest or estate which Borrower may hereafter acquire in the property described above, and all additions and accretions thereto, and the proceeds of any of the foregoing;
(f)	Fixtures and Personal Property. All goods, furnishings, work in progress, machinery, equipment, fixtures (including all heating, air conditioning, plumbing, lighting, communications and elevator fixtures) and other property of every kind and nature whatsoever owned by Borrower, or in which Borrower has or shall have an interest, now or hereafter located upon the Premises or the Improvements, or appurtenant thereto, and used in connection with the present or future operation and occupancy of the Premises and the Improvements and all building equipment, materials and supplies of any nature whatsoever owned by Borrower, or in which Borrower has or shall have an interest, now or hereafter located upon the Premises and the Improvements, or appurtenant thereto, or used in connection with the present or future operation and occupancy of the Premises and the Improvements (collectively, the “Personal Property”), and the right, title and interest of Borrower in and to any of the Personal Property which may be subject to any security interests, as defined in the Uniform Commercial Code, as adopted and enacted

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by the state or states where any of the Premises is located (the “Uniform Commercial Code”), superior in lien to the Lien of this Security Instrument and all proceeds and products of the above;

(g)	Leases and Rents. All current and future leases, rental agreements, occupancy agreements and other agreements of whatever form now or hereafter affecting the use, enjoyment or occupancy of, or the conduct of any activity upon or in, all or any part of the Premises or the Improvements, including any guaranties, extensions, renewals, replacements or modifications thereof, whether before or after the filing by or against Borrower of any petition for relief under 11 U.S.C. § 101 et seq. (the “Bankruptcy Code”), as the same may be amended from time to time (the “Leases”) and all rents, rent equivalents, moneys payable as damages or in lieu of rent or rent equivalents, royalties (including all oil and gas or other mineral royalties and bonuses), income, receivables, receipts, revenues, deposits (including security, utility and other deposits), accounts, cash, issues, fees, profits, charges for services rendered, and other consideration of whatever form or nature received by or paid to or for the account of or benefit of Borrower or its agents or employees from any and all sources (including any warrants, stock options or other rights granted to Borrower, any Principal or their Affiliates in connection with any Lease) arising from or attributable to the Premises and the Improvements, together with all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Debt and all right, title and interest of Borrower, its successors and assigns therein and thereunder, including all guarantees, letters of credit and any other credit support given by any guarantor in connection therewith, cash or securities deposited under the Leases to secure the performance by the lessees of their obligations thereunder and all rents, additional rents, revenues, issues and profits (including all oil and gas or other mineral royalties and bonuses) from the Premises and the Improvements whether paid or accruing before or after the filing by or against Borrower of any petition for relief under the Bankruptcy Code (collectively, the “Rents”) and all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Debt;
(h)	Condemnation Awards. All awards or payments, including interest thereon, which may heretofore and hereafter be made with respect to the Premises, whether from the exercise of the right of eminent domain (including any transfer made in lieu of or in anticipation of the exercise of the right), or for any other injury to or decrease in the value of the Premises;
(i)	Insurance Proceeds. All proceeds of and any unearned premiums on any insurance policies covering the Premises, including the right to receive and apply the proceeds of any insurance judgments, or settlements made in lieu thereof, for damage to the Property;
(j)	Tax Certiorari. All refunds, rebates or credits in connection with a reduction in real estate taxes and assessments charged against the Premises as a result of tax certiorari or any applications or proceedings for reduction;
(k)	Rights. The right, in the name and on behalf of Borrower, to commence any action or proceeding to protect the interest of Lender in the Premises and while an Event of Default

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remains uncured, to appear in and defend any action or proceeding brought with respect to the Premises;

(l)	Agreements. All agreements, contracts, certificates, instruments, franchises, permits, licenses, plans, specifications and other documents, now or hereafter entered into, and all rights therein and thereto, respecting or pertaining to the use, occupation, construction, management or operation of the Premises and any part thereof and any Improvements or respecting any business or activity conducted on the Property and any part thereof.
(m)	Service Rights. Any agreements, contracts, rights, licenses or other interests of any type (collectively, the “Service Rights”) (whether exclusive or non-exclusive) granted or given to any Person to provide any products or services to or for or with respect to the Premises, any Tenant or any occupants of the Premises, including any of the same related to telecommunications, internet products or services, including, but not limited to, personal computer hardware and software, internet hardware and software, internet access services, printers, video display systems, audio sound systems and communication telephonic devices, as well as related and complementary products and services and any substitutes for, and items that are a technological evolution of, any of the foregoing products.
(n)	Intangibles. All accounts, escrows, documents, instruments, chattel paper, claims, deposits and other general intangibles, as the foregoing terms are defined in the Uniform Commercial Code of the state in which the Property is located (hereinafter collectively referred to as the “Intangibles”);
(o)	Options. All options to purchase and rights of first refusal to purchase or acquire a fee estate, easement interest or other real property right to land, both vacant and improved, adjoining the Premises now or hereafter in effect; and
(p)	Proceeds. All proceeds, products, offspring, rents and profits from any of the foregoing, including those from sale, exchange, transfer, collection, loss, damage, disposition, substitution or replacement of any of the foregoing.

     As to all of the above-described Property which is or which hereafter becomes a “fixture” under applicable law, this Mortgage constitutes a fixture filing under the UCC, as amended or recodified from time to time.

Section 1.02 Pledge of Monies Held. Borrower hereby pledges to Lender, and grants to Lender a security interest in, any and all monies now or hereafter held by Lender pursuant to the Loan Agreement or the other Loan Documents as additional security for the Obligations until expended or applied or required to be applied as provided in this Security Instrument, the Loan Agreement and the other Loan Documents.

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CONDITIONS TO GRANT

          TO HAVE AND TO HOLD the above granted and described Property unto the Lender, and the successors and assigns of Lender, forever;

          PROVIDED, HOWEVER, these presents are upon the express condition that, if Borrower shall well and truly pay to Lender the Debt at the time and in the manner provided in the Note, this Security Instrument and the other Loan Documents, shall well and truly perform the Other Obligations as set forth in this Security Instrument and the other Loan Documents and shall well and truly abide by and comply with each and every covenant and condition set forth in the Loan Documents, these presents and the estate hereby granted shall cease, terminate and be void.

ARTICLE II. DEBT AND OBLIGATIONS SECURED

Section 2.01 Debt. This Security Instrument and the grants, assignments and transfers made in Article I are given for the purpose of securing the following, in such order of priority as Lender may determine in its sole discretion (the “Debt”): (1) all principal, interest and other amounts due under or secured by the Loan Documents; (2) the payment of all other monies agreed or provided to be paid by Borrower in the Note or the other Loan Documents; (3) the payment of all sums advanced pursuant to this Security Instrument to protect and preserve the Property and the Lien and the security interest created hereby; (4) the payment of all sums advanced and costs and expenses incurred by Lender in connection with the Debt or any part thereof, any renewal, extension, modification, consolidation, change, substitution, replacement, restatement or increase of the Debt or any part thereof, or the acquisition or perfection of the security therefor, whether made or incurred at the request of Borrower or Lender (including, without limitation, (i) modifications of the required principal payment dates or interest payment dates or both, as the case may be, deferring or accelerating payment dates wholly or partly; or (ii) modifications, extensions or renewals at a different rate of interest whether or not in the case of a note, the modification, extension or renewal is evidenced by a new or additional promissory note or notes); (5) all principal, interest, and other amounts which may hereafter be loaned by Lender, its successors or assigns, to or for the benefit of the owner of the Property, when evidenced by a promissory note or other instrument which, by its terms, is secured hereby; (6) all other indebtedness, obligations and liabilities now or hereafter existing of any kind of Borrower to Lender under documents which recite that they are intended to be secured by this Security Instrument; (7) payment and performance of all covenants and obligations arising under or by virtue of the Loan Documents, if any, and (8) this Security Instrument is specifically intended to include any indebtedness of Borrower to Lender which exists as of the date of this Security Instrument or which may hereafter be incurred by Borrower to Lender in connection with the Loan Documents.

Section 2.02 Debt and Other Obligations. This Security Instrument and the grants, assignments and transfers made in Article I are also given for the purpose of securing the performance of all of the agreements, covenants, conditions, warranties, representations and other obligations (other than to repay the Debt) made or undertaken by Borrower or any other Person to Lender or others as set forth in the Loan Documents. The obligations of Borrower and

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all other Persons for the payment of the Debt and the performance of the Other Obligations shall be referred to herein collectively as the “Obligations.” The term “Obligations” is used herein in its broadest and most comprehensive sense and shall be deemed to include, without limitation, all interest and charges, prepayment premiums (if any), late charges and loan fees at any time accruing or assessed on any of the Debt or Loan.

Section 2.03 Payments. Unless payments are made in the required amount in immediately available funds at the place where the Note is payable, remittances in payment of all or any part of the Debt shall not, regardless of any receipt or credit issued therefor, constitute payment until the required amount is actually received by Lender in funds immediately available at the place where the Note is payable (or any other place as Lender, in Lender’s sole discretion, may have established by delivery of written notice thereof to Borrower) and shall be made and accepted subject to the condition that any check or draft may be handled for collection in accordance with the practice of the collecting bank or banks. Acceptance by Lender of any payment in an amount less than the amount then due shall be deemed an acceptance on account only, and the failure to pay the entire amount then due shall be and continue to be an Event of Default.

ARTICLE III. BORROWER COVENANTS

          Borrower covenants and agrees with Lender that:

Section 3.01 Payment of Debt. Borrower will pay the Debt at the time and in the manner provided in the Note and the other Loan Documents.

Section 3.02 Warranty of Title. Borrower hereby warrants that: (a) except for the Permitted Encumbrances, Borrower has good, marketable and insurable fee simple title to the Property, including the right to encumber the Property; (b) Borrower has the full power, authority and right to execute, deliver and perform its Obligations under this Security Instrument and to encumber, grant, bargain, sell, convey, assign and mortgage the Property in the manner and form hereby done or intended; (c) Borrower possesses an unencumbered fee simple estate in the Premises and the Improvements and Borrower owns the Property free and clear of all Liens, encumbrances and charges whatsoever except for the Permitted Encumbrances and those exceptions accepted by Lender as shown in the title opinion insuring the Lien of this Security Instrument; and (d) this Security Instrument is and will remain a valid and enforceable first and senior Lien on and security interest in the Property. Borrower shall forever warrant, defend and preserve such title and the validity and priority of the Lien of this Security Instrument and shall forever warrant and defend the same to Lender against the claims of all Persons whomsoever. The foregoing warranty of title shall survive the foreclosure of this Security Instrument and shall inure to the benefit of and be enforceable by Lender in the event Lender acquires title to the Property pursuant to any foreclosure or deed in lieu of foreclosure or otherwise.

Section 3.03 Incorporation by Reference. All the covenants, conditions, terms, provisions and agreements contained in (a) the Note and (b) the other Loan Documents, are hereby made a part of this Security Instrument to the same extent and with the same force as if fully set forth herein. All Persons who may have or acquire an interest in the Property shall be deemed to have notice of the terms of the Obligations and to have notice, if provided therein, that the Note or the

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Loan Agreement may permit borrowing, repayment and re-borrowing so that repayments shall not reduce the amounts of the Obligations.

ARTICLE IV. FURTHER ASSURANCES

Section 4.01 Recording of Security Instrument, Etc. Borrower forthwith upon the execution and delivery of this Security Instrument and thereafter, from time to time, will cause this Security Instrument and any of the other Loan Documents (including all UCC financing statements) creating a Lien or security interest or evidencing the Lien hereof upon the Property and each instrument of further assurance to be filed, registered or recorded in such manner and in such places as may be required by any present or future law in order to publish notice of and fully to protect and perfect the Lien or security interest hereof upon, and the interest of Lender in, the Property.

Section 4.02 Further Acts. Borrower will, at the sole cost and expense of Borrower, and without any cost or expense to Lender, do, execute, acknowledge and deliver all and every such further acts, deeds, conveyances, mortgages, assignments, notices of assignments, transfers and assurances as Lender shall, from time to time, reasonably require, for the better assuring, conveying, assigning, transferring, and confirming unto Lender, the Property and rights hereby mortgaged, granted, bargained, sold, conveyed, confirmed, pledged, assigned, warranted and transferred or intended now or hereafter so to be, or which Borrower may be or may hereafter become bound to convey or assign to Lender, or for carrying out the intention or facilitating the performance of the terms of this Security Instrument or for filing, registering or recording this Security Instrument, or for complying with all Legal Requirements.

Section 4.03 Changes in Tax, Debt Credit and Documentary Stamp Laws. If any law is enacted or adopted or amended after the date of this Security Instrument which deducts the Debt from the value of the Property for the purpose of taxation or which imposes a tax, either directly or indirectly, on the Debt or Lender’s interest in the Property, Borrower will pay the tax, with interest and penalties thereon, if any.

ARTICLE V. ASSIGNMENT OF RENTS

Section 5.01 Assignment of Rents. Borrower hereby absolutely and unconditionally assigns to Lender all of Borrower’s right, title and interest in and to all current and future Leases and Rents. Nevertheless, subject to the terms of this Article V, Lender grants to Borrower a revocable license to collect, receive and apply the Rents in accordance with the Loan Agreement and the other Loan Documents. Borrower shall hold the Rents, or a portion thereof, sufficient to discharge all current sums due on the Debt, for use in the payment of such sums. Lender agrees not to revoke the license to collect rents unless an uncured Event of Default has occurred pursuant to the Loan Documents.

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ARTICLE VI. SECURITY AGREEMENT

Section 6.01 Security Agreement. This Security Instrument is both a mortgage in real property and a “security agreement” within the meaning of the Uniform Commercial Code. The Property includes both real and personal property and all other rights and interests, whether tangible or intangible in nature, of Borrower in the Property. Borrower by executing and delivering this Security Instrument has granted and hereby grants to Lender, as security for the Obligations, a security interest in the Property to the full extent that the Property may be subject to the Uniform Commercial Code (said portion of the Property so subject to the Uniform Commercial Code being referred to in this Paragraph as the “Collateral”). This Security Instrument shall also constitute a “fixture filing” for the purposes of the Uniform Commercial Code. As such, this Security Instrument covers all items of the Collateral that are or are to become fixtures. Information concerning the security interest herein granted may be obtained from the parties at the addresses of the parties set forth above. If an Event of Default shall occur, Lender, in addition to any other rights and remedies which it may have, shall have and may exercise, immediately and without demand, any and all rights and remedies granted to a secured party upon default under the Uniform Commercial Code, including the right to take possession of the Collateral or any part thereof and to take such other measures as Lender may deem necessary for the care, protection and preservation of the Collateral or the sale thereof. Upon request or demand of Lender, Borrower shall at its expense assemble the Collateral and make it available to Lender at a convenient place acceptable to Lender. Borrower shall pay to Lender on demand any and all expenses, including attorneys’ fees and disbursements, incurred or paid by Lender in protecting its interest in the Collateral and in enforcing its rights hereunder with respect to the Collateral. The proceeds of any disposition of the Collateral, or any part thereof, may be applied by Lender to the payment of the Debt in such priority and proportions as Lender in its sole discretion shall deem proper. In the event of any change in name, identity or structure of Borrower, Borrower shall notify Lender thereof and promptly after request shall execute, file and record such Uniform Commercial Code forms as are necessary to maintain the priority of Lender’s lien upon and security interest in the Collateral and shall pay all expenses and fees in connection with the filing and recording thereof. If Lender shall require the filing or recording of additional Uniform Commercial Code forms or continuation statements, Borrower shall, promptly after request, execute, file and record such Uniform Commercial Code forms or continuation statements as Lender shall deem necessary, and shall pay all expenses and fees in connection with the filing and recording thereof. Borrower hereby irrevocably appoints Lender as its attorney-in-fact, coupled with an interest, to file with the appropriate public office on Borrower’s behalf any financing or other statements signed only by Lender, as secured party, in connection with the Collateral covered by this Security Instrument, and Borrower hereby acknowledges and agrees that Borrower shall have no claim or cause of action against Lender arising out of Lender’s execution and/or recordation of any instruments by or on behalf of Borrower pursuant to the foregoing power of attorney. Any notice of sale, disposition or other intended action by Lender with respect to the Collateral sent to Borrower in accordance with Section 13.1 at least two (2) Business Days prior to such action, shall constitute commercially reasonable notice to Borrower.

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ARTICLE VII. DUE ON SALE/ENCUMBRANCE

Section 7.01 No Sale/Encumbrance. Except as specifically permitted by the Loan Agreement, Borrower agrees that Borrower shall not, without the prior written consent of Lender, sell, convey, mortgage, grant, bargain, encumber, pledge, assign, or otherwise transfer the Property or any part thereof or permit the Property or any part thereof to be sold, conveyed, mortgaged, granted, bargained, encumbered, pledged, assigned, or otherwise transferred. Borrower further agrees that Borrower will not allow any Transfer or other similar action prohibited by the Loan Agreement. If Borrower violates the terms of this provision, Lender, in Lender’s sole and absolute discretion, may declare all Obligations immediately due and payable.

ARTICLE VIII. PREPAYMENT

Section 8.01 Prepayment Only in Accordance with Note. The Debt may be prepaid in accordance with the terms and conditions of the Note and the Loan Agreement.

ARTICLE IX. DEFAULT

Section 9.01 Events of Default. The occurrence of any one or more of the following events shall constitute an “Event of Default”:

(a) if any portion of the Debt is not paid before such failure constitutes an Event of Default as defined in the Loan Agreement or if the entire Debt is not paid on or before the Maturity Date; or

(b) the occurrence of any other Event of Default as defined in the Loan Agreement or the Loan Documents.

ARTICLE X. RIGHTS AND REMEDIES

Section 10.01 Remedies.

(a)	Upon the occurrence of any Event of Default, Lender may take such action, without notice or demand, as Lender deems advisable to protect and enforce the rights of Lender against Borrower and in and to the Property, including the following actions, each of which may be pursued concurrently or otherwise, at such time and in such order as Lender may determine, in its sole discretion, without impairing or otherwise affecting the other rights and remedies of Lender.
i.	Declare the entire Debt and all other Obligations to be immediately due and payable;
ii.	institute a proceeding or proceedings, judicial or nonjudicial, for the foreclosure of the Security Instrument under applicable Legal Requirements in which case the

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Property or any interest therein may be sold for cash or upon credit in one or more parcels or in several interests or portions and in any order or manner, and to apply the proceeds received upon the Obligations in such order and manner as Lender, determines in its sole discretion;

iii.	with or without entry, to the extent permitted and pursuant to the procedures provided by applicable Legal Requirements, institute proceedings for the partial foreclosure of this Security Instrument for the portion of the Debt then due and payable, subject to the continuing Lien and security interest of this Security Instrument for the balance of the Debt not then due unimpaired and without loss of priority;
iv.	institute an action, suit or proceeding in equity for the specific performance of any covenant, condition or agreement contained herein, or in any of the other Loan Documents;
v.	recover judgment on the Note either before, during or after any proceedings for the enforcement of this Security Instrument or the other Loan Documents;
vi.	apply for the appointment of a receiver, without notice and without regard for the adequacy of the security for the Debt or the Obligations and without regard for the solvency of the Borrower, Guarantor or of any Person liable for the payment of the Debt, without the necessity of a declaration that the Debt and/or the Obligations are immediately due and payable, and Borrower hereby consents to such appointment. Any such appointment shall be without bond being required of the person appointed;
vii.	subject to any applicable Legal Requirement, the license granted to Borrower under Section 5.1 shall automatically be revoked and Lender may enforce Lender’s interest in the Leases and Rents (including revocation of any license granted to Borrower) and enter into or upon the Property, either personally or by its agents, nominees or attorneys and dispossess Borrower and its agents and servants therefrom, without becoming a mortgagee in possession and without liability for trespass, damages or otherwise and exclude Borrower and its agents or servants wholly therefrom, and take possession of all books, records, papers and accounts relating thereto and Borrower agrees to surrender possession of the Property and of such books, records, papers and accounts to Lender upon demand, and thereupon Lender may, with or without notice, without releasing Borrower from any Obligations, and without any obligation to do so, cure any breach or Event of Default;
viii.	Lender may proceed at its election, in any sequence: (a) to dispose of any Collateral separately from the sale of the Property in accordance with the UCC or other applicable Legal Requirements, and (b) to dispose of some or all of the Property in any combination consisting of both real and personal property together in one or more sales to be held in accordance with the UCC or other applicable Legal Requirements; or

11

ix.	pursue or enforce any other right or remedy allowed by any Loan Document or applicable Legal Requirements including those rights and remedies available to a secured party under the UCC or other applicable Legal Requirements.
(b)	Borrower hereby agrees that in the event of judicial or nonjudicial foreclosure, Lender, may at its sole option, in addition to any other remedy provided in the Loan Documents or by law, elect:
i.	Pursuant to Section 628.26 of the Iowa Code, to reduce the period of redemption after sale on foreclosure to six months; or
ii.	Pursuant to Section 628.27 of the Iowa Code, to reduce the period of redemption after sale on foreclosure to sixty days; or
iii.	Pursuant to Section 628.28 of the Iowa Code, or any other Iowa Code Section, to reduce the period of redemption after sale on foreclosure to such time as may then be applicable or provided by law; or
iv.	Pursuant to Section 654.20 of the Iowa Code, or any other Iowa Code Section, to foreclose without redemption; or
v.	Pursuant to Chapter 655A of the Iowa Code, foreclose non-judicially.
(c)	In the event of a sale, by foreclosure or otherwise, of less than all of the Property, this Security Instrument shall continue as a Lien and security interest on the remaining portion of the Property unimpaired and without loss of priority.
(d)	Upon the occurrence of any Event of Default, Lender may, but without any obligation to do so and without notice to or demand on Borrower and without releasing Borrower from any Obligation, cure the same in such manner and to such extent as Lender may deem necessary to protect the security hereof. Lender is authorized to enter upon the Property for such purposes, or appear in, defend, or bring any action or proceeding to protect Lender’s interest in the Property or to foreclose this Security Instrument or collect the Debt.
(e)	All costs and expenses of Lender in exercising its rights and remedies under this Section 10.1 or incurred as a result of any of the events described in Section 7 of the Loan Agreement, including reasonable attorneys’ fees and disbursements to the extent permitted by law, shall be paid by Borrower immediately upon notice from Lender, with interest at the Default Rate for the period after notice from Lender and such costs and expenses shall constitute a portion of the Debt and shall be secured by this Security Instrument and shall be immediately due and payable upon demand by Lender therefor.
(f)	The interests and rights of Lender under the Note, this Security Instrument or in any of the other Loan Documents shall not be impaired by any indulgence, including (i)

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any renewal, extension or modification which Lender may grant with respect to any of the Debt, (ii) any surrender, compromise, release, renewal, extension, exchange or substitution which Lender may grant with respect to the Property or any portion thereof; (iii) any modification, waiver or failure to enforce any provisions of the Loan Documents; or (iv) any release or indulgence granted to any maker, endorser, Guarantor, indemnitor or surety of any of the Debt.

Section 10.02 Other Rights.

(a) The failure of Lender to insist upon strict performance of any term hereof, shall not be deemed to be a waiver of such term or any other term of this Security Instrument or the other Loan Documents. Borrower shall not be relieved of Borrower’s obligations hereunder by reason of (i) the failure of Lender to comply with any request of Borrower or Guarantor to take any action to foreclose this Security Instrument or otherwise enforce any of the provisions hereof or of the Note or the other Loan Documents, (ii) the release, regardless of consideration, of the whole or any part of the Property, or of any Person liable for the Debt or any portion thereof, or (iii) any agreement or stipulation by Lender extending the time of payment or otherwise modifying or supplementing the terms of the Note, this Security Instrument or the other Loan Documents.

(b) It is agreed that Borrower bears the risk of loss or damage to the Property, and Lender shall have no liability whatsoever for decline in value of the Property, for failure to maintain the Policies, or for failure to determine whether insurance in force is adequate as to the amount of risks insured. Possession by Lender shall not be deemed an election of judicial relief, if any such possession is requested or obtained, with respect to any Property or Collateral not in Lender’s actual and/or physical possession.

(c) Lender may resort for the payment of the Debt to any security held by Lender in such order and manner as Lender, in its sole discretion, may elect. Lender may take action to recover the Debt or any portion thereof, or to enforce any covenant hereof without prejudice to the right of Lender thereafter to foreclose this Security Instrument. The rights of Lender under this Security Instrument shall be separate, distinct and cumulative and none shall be given effect to the exclusion of the others. No act of Lender shall be construed as an election to proceed under any one provision herein to the exclusion of any other provision. Lender shall not be limited exclusively to the rights and remedies herein stated but shall be entitled to every right and remedy now or hereafter afforded at law or in equity.

Section 10.03 Right to Release Any Portion of the Property. Lender may release any portion of the Property, for such consideration as Lender may require (or as may be required pursuant to the Loan Agreement) without, as to the remainder of the Property, in any way impairing or affecting the Lien or priority of this Security Instrument, or improving the position of any subordinate lien holder with respect thereto, except to the extent that the obligations hereunder shall have been reduced by the actual monetary consideration, if any, received by Lender for such release, and may accept by assignment, pledge or otherwise any other property in place

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thereof as Lender may require without being accountable for so doing to any other lien holder. This Security Instrument shall continue as a Lien and security interest in the remaining portion of the Property.

Lender hereby consents to the transfer of the portion of the Real Property legally described as Lot 7 in Division 2 GRIMMEL’S ADDITION TO THE TOWN OF FORT DES MOINES, an Official Plat, now included in and forming a part of the City of Des Moines, Polk County, Iowa, provided a release price equal to 100% of net sales proceeds (not less than $50,000 or such lesser amount as may be reasonably acceptable to Lender) shall be paid to Lender and applied by Lender to the reduction of the outstanding principal balance of the Loan. For the purposes hereof, net sales proceeds shall equal the gross sale price for the property to be sold less transfer taxes and other closing costs and fees customarily and normally paid by a seller, including, without limitation, Seller’s brokerage commissions to unrelated third party brokers at then prevailing market rates and federal, state or other excise taxes paid or assessable.

ARTICLE XI. WAIVERS

Section 11.01 Waiver of Trial by Jury. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING UNDER THE LOAN DOCUMENTS, INCLUDING, WITHOUT LIMITATION, ANY PRESENT OR FUTURE MODIFICATION THEREOF OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THE LOAN DOCUMENTS (AS NOW OR HEREAFTER MODIFIED) OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION IS NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF ANY RIGHT THEY MIGHT OTHERWISE HAVE TO TRIAL BY JURY.

Section 11.02 Additional Waivers. Lender may resort to any remedies and the security given by the Note, this Security Instrument or any of the other Loan Documents, in whole or in part, and in such portions and in such order as determined by Lender in Lender’s sole discretion. No such action shall in any way be considered a waiver of any rights, benefits or remedies evidenced or provided by the Note, this Security Instrument or any of the other Loan Documents. The failure of Lender to exercise any right, remedy or option provided in the Note, this Security Instrument or any of the other Loan Documents shall not be deemed a waiver of such right, remedy or option or of any covenant or obligation secured by the Note, this Security Instrument or any of the other Loan Documents. No acceptance by Lender of any payment after the occurrence of any Event of Default and no payment by Lender of any obligation for which Borrower is liable hereunder shall be deemed to waive or cure any Event of Default with respect

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to Borrower, or Borrower’s liability to pay such obligation. No sale of all or any portion of the Property, no forbearance on the part of Lender and no extension of time for the payment of the whole or any portion of the Debt, or any other indulgence given by Lender to Borrower, shall operate to release or in any manner affect the interest of Lender in the remaining Property or the liability of Borrower to pay the Debt. No waiver by Lender shall be effective unless it is in writing and then only to the extent specifically stated. In case Lender shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under any of the other Loan Documents and shall thereafter elect to discontinue or abandon the same for any reason, Lender shall have the unqualified right to do so and, in such event, Borrower and Lender shall be restored to their former positions with respect to the Debt secured hereby, this Security Instrument, the other Loan Documents, the Property and otherwise, and the rights, remedies, recourses and powers of Lender shall continue as if the same had never been invoked.

Section 11.03 Borrower’s Waivers. Borrower waives, to the extent permitted by law, (a) the benefit of all laws now existing or that may hereafter be enacted providing for any appraisement before sale of any portion of the Property, (b) all rights and remedies which Borrower may have or be able to assert by reason of the laws of the state where the Property is located pertaining to the rights and remedies of sureties, (c) any rights, legal or equitable, to require marshalling of assets or to require foreclosure sales in a particular order. Lender shall have the right to determine the order in which any portion of the Property is subject to the remedies herein and the order in which the Obligations are satisfied by proceeds realized by such remedies.

ARTICLE XII. EXCULPATION

Section 12.01 Exculpation. The provisions of Article IX of the Loan Agreement are hereby incorporated by reference to the fullest extent as if the text of such Article were set forth in its entirety herein.

ARTICLE XIII. NOTICES

Section 13.01 Notices. All notices given under this Security Instrument shall be given and become effective as provided in the Loan Agreement.

ARTICLE XIV. APPLICABLE LAW

Section 14.01 Choice of Law. This Security Instrument shall be interpreted, construed and enforced according to the laws of the State of Iowa with enforcement in the Iowa District Court in the county in which the Real Property is located. All parties submit themselves to the jurisdiction of said Court.

Section 14.02 Provisions Subject to Applicable Law. All rights, powers and remedies provided in this Security Instrument may be exercised only to the extent that the exercise thereof does not violate any applicable Legal Requirements and are intended to be limited to the extent necessary so that they will not render this Security Instrument invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of any Legal Requirements.

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ARTICLE XV. MISCELLANEOUS PROVISIONS

Section 15.01 Survival. This Security Instrument and all covenants, agreements, representations and warranties made herein and in the certificates delivered in connection with the Loan Documents shall survive the making by Lender of the Loan and the execution and delivery to Lender of the Note, and shall continue in full force and effect so long as all or any of the Debt is outstanding and unpaid unless a longer period is expressly set forth herein or in the other Loan Documents. Whenever in this Security Instrument any of the parties hereto is referred to, such reference shall be deemed to include the legal representatives, successors and assigns of such party. All covenants, promises and agreements in this Security Instrument, by or on behalf of Borrower, shall inure to the benefit of the legal representatives, successors and assigns of Lender.

Section 15.02 No Oral Change. No modification, amendment, extension, discharge, termination or waiver of any provision of this Security Instrument, the Note, or any other Loan Document, nor consent to any departure by Lender therefrom, shall in any event be effective unless the same shall be in a writing signed by the party against whom enforcement is sought, and then such waiver or consent shall be effective only in the specific instance, and for the purpose, for which given. Except as otherwise expressly provided herein, no notice to or demand on Borrower, shall entitle Borrower to any other or future notice or demand in the same, similar or other circumstances.

Section 15.03 Duplicate Originals; Counterparts. This Security Instrument may be executed in any number of duplicate originals and each duplicate original shall be deemed to be an original. This Security Instrument may be executed in several counterparts, each of which counterparts shall be deemed an original instrument and all of which together shall constitute a single Security Instrument. The failure of any party hereto to execute this Security Instrument, or any counterpart hereof, shall not relieve the other signatories from their obligations hereunder.

Section 15.04 Number and Gender. Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural and vice versa.

Section 15.05 Headings, Etc. The headings and captions of various Sections of this Security Instrument are for convenience of reference only and are not to be construed as defining or limiting, in any way, the scope or intent of the provisions hereof.

Section 15.06 Inapplicable Provision. If any term of this Security Instrument or any application thereof shall be invalid or unenforceable, the remainder of this Security Instrument and any other application of the term shall not be affected thereby.

Section 15.07 Entire Agreement. This Security Instrument and the other Loan Documents together constitute a written agreement and represent the final agreement between the parties and may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties. There are no unwritten oral agreements between the parties. Borrower hereby acknowledges that, except as incorporated in writing in the Note, this Security Instrument and the other Loan Documents, there are not, and were not, and no Persons are or were authorized by

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Lender to make, any representations, understandings, stipulations, agreements or promises, oral or written, with respect to the transaction which is the subject of the Note, this Security Instrument and the other Loan Documents.

Section 15.08 Time. Time is of the essence with respect to all provisions of this Security Instrument.

Section 15.09 Binding Effect. This Security Instrument shall be binding upon and inure to the benefit of Borrower and Lender and their respective permitted successors and assigns forever.

Section 15.10 Exhibits. All exhibits attached hereto are hereby incorporated herein by reference and made a part of this Security Instrument.

IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT.

     By signing below, the parties hereto acknowledge that in concurrently received of a copy of the document and each document referenced herein.

          IN WITNESS WHEREOF, Borrower has duly executed this Security Instrument the day and year first above written.

[Signature Page Follows]

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BORROWER: SIR Park Place, LLC, an Iowa limited liability company by: Steadfast Income Advisor, LLC, its Manager
By:	/s/  James Kasim
	Name:	James Kasim
	Title:	Chief Financial Officer

STATE OF _____________	)
	) SS.
COUNTY OF _________	)

     This instrument was acknowledged before me on this ___ day of December, 2010 by ____________ as ____________ of Steadfast Income Advisor, LLC, the Manager of SIR Park Place, LLC.

[See Attached Certificate]                

Notary Public in and for the State of ______

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EXHIBIT A

LEGAL DESCRIPTION

Lot Seven (7) in Division 2 Grimmel’s Addition to the Town of Fort Des Moines, an Official Plat, now included in and forming a part of the City of Des Moines, Polk County, Iowa.

AND

Units 403 through 409, inclusive, Units 501 and 502, Units 504 through 508, inclusive, Units 510 through 512, inclusive, Units 601 through 612, inclusive, Units 701 through 712, inclusive, Units 801 through 812, inclusive, Units 901 through 912, inclusive, Units 1001, 1002, 1004 and 1005, Units 1007 through 1012, inclusive, Units 1101 through 1112, inclusive, Units 1201 through 1212, inclusive, Units 1301 and 1302, Units 1304 through 1312 inclusive, Units 1401 and 1402, Units 1404 through 1412, inclusive, Units 1501 through 1503, inclusive, Units 1506 through 1512, inclusive, Units 1601 through 1616, inclusive, Garage Units P1 though P20, inclusive, Garage Units P21a and P21b, Garage Units P22 and P23, Garage Units P25 through P51, inclusive, Garage Units P53 through P58, inclusive, Garage Units P60a and P60b, Garage Units P62 through P68, inclusive, Garage Units P69a and 69b, Garage Units P70 through P90, Garage Units P92 through P103, inclusive, together with percentage interest in the Common Elements as provided in the Declaration of Submission to the Horizontal Property Regime referred to below, in PARK PLACE CONDO LLC, a Condominium, City of Des Moines, and County of Polk, Iowa, and located upon Lots 6 and 7 in Block “R” in Grimmel’s Addition to the Town of Fort Des Moines, in accordance with and subject to the Declaration of Submission to Horizontal Property Regime, recorded on December 18, 2006 in Book 11997 Page 522 in the records of the Polk County Iowa recorder as amended.

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EX-10.4

Exhibit 10.4

GUARANTY

     THIS GUARANTY is executed as of the 22nd day of December, 2010, by Steadfast Income REIT, Inc., a Maryland corporation, with offices at 18100 Von Karman Avenue, Suite 500, Irvine, California (“Guarantor”) for the benefit of Ames Community Bank, with offices at 925 Gateway Drive, Grimes, Iowa 50111 (“Lender”).

W I T N E S S E T H:

     WHEREAS, Lender has committed to make a loan to SIR Park Place, LLC, an Iowa limited liability company (“Borrower”) to be secured by certain Property as defined in the Loan Agreement and other Loan Documents on the condition that Guarantor guarantees the payment of up to ONE MILLION DOLLARS ($1,000,000) of the Loan and Note.

     NOW, THEREFORE, as a material inducement to Lender to make the Loan to Borrower, Guarantor hereby agrees as follows:

ARTICLE I

NATURE AND SCOPE OF GUARANTY

     Section 1.01. Guaranty of Obligation. Guarantor hereby irrevocably and unconditionally guarantees to Lender the prompt payment when due of the “Guaranteed Debt” (hereinafter defined). Guarantor acknowledges and agrees that Guarantor will receive, directly or indirectly, great and material benefit from the making of this Guaranty. Notwithstanding the foregoing or any other provision of this Guaranty, in no event shall Guarantor’s aggregate liability under this Guaranty exceed the lesser of One Million Dollars or the Guaranteed Payment (defined below).

     Section 1.02. Definition of Guaranteed Debt. As used herein, the term “Guaranteed Debt” means:

     (a) All principal, interest, commitment fees, late fees, liabilities for costs and expenses and other indebtedness, obligations and liabilities of Borrower to Lender arising under that certain Promissory Note (the “Note”), of even date herewith, executed by Borrower and payable to the order of Lender in the original principal amount of $5,000,000.00 and under any renewals, modifications, increases and extensions of the Note (collectively, the “Guaranteed Note”) and under any other documents or instruments securing payment of the Guaranteed Note; and

     (b) All costs, expenses and fees, including but not limited to court costs and attorneys’ fees, arising in connection with the collection of any or all amounts, indebtedness, obligations and liabilities of Borrower to Lender described in item (a) of this Section 1.02.

     Section 1.03. Payment by Guarantor. If all or any part of the Guaranteed Debt shall not be paid when due, whether at maturity or earlier by acceleration or otherwise, Guarantor shall, immediately upon demand by Lender, and without presentment, protest, notice of protest, notice of non-payment, notice of intention to accelerate or acceleration or any other notice whatsoever,

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pay in lawful money of the United States of America an amount not to exceed ONE MILLION DOLLARS (the “Guaranteed Payment”) due on the Guaranteed Debt to Lender at Lender’s principal office set forth in the preamble hereof. Notwithstanding the foregoing or any other provision of this Guaranty or any of the other Loan Documents, (a) the amount of the Guaranteed Payment shall be reduced one dollar for each dollar that the principal balance payable under the Note is reduced below $5,000,000,00 and (b) this Guaranty shall automatically terminate and be of no further force or effect if the principal balance payable under the Note is ever less than or equal to $4,000,000.00.

     Section 1.04. No Duty to Pursue Others. It shall not be necessary for Lender (and Guarantor hereby waives any rights which Guarantor may have to require Lender), in order to enforce such payment by Guarantor, first to (i) institute suit or exhaust its remedies against Borrower, (ii) enforce Lender’s rights against any security which shall ever have been given to secure the Guaranteed Debt, (iii) join Borrower or any others liable on the Guaranteed Debt in any action seeking to enforce this Guaranty, or (iv) resort to any other means of obtaining payment of the Guaranteed Debt. Lender shall not be required to mitigate damages or take any other action to reduce, collect or enforce the Guaranteed Debt.

     Section 1.05. Waiver of Notices, Etc. Guarantor agrees to the provisions of the Guaranteed Note, and hereby waives notice of (i) any loans or advances made by Lender to Borrower, (ii) acceptance of this Guaranty, (iii) any amendment or extension of the Guaranteed Note or of any other instrument or document pertaining to all or any part of the Guaranteed Debt, or (iv) any other action at any time taken or omitted by Lender, and, generally, all demands and notices of every kind in connection with this Guaranty and any documents or agreements evidencing, securing or relating to any of the Guaranteed Debt and the obligations hereby guaranteed.

     Section 1.06. Nature of Guaranty. This Guaranty is an irrevocable, absolute, continuing guaranty of payment and not a guaranty of collection.

     Section 1.07. Payment of Expenses. In the event that Guarantor should breach or fail timely to perform any provisions of this Guaranty, Guarantor shall, immediately upon demand by Lender, pay Lender all costs and expenses (including internal administrative expenses and costs, court costs and reasonable attorneys’ fees) incurred by Lender in the enforcement hereof or the preservation of Lender’s rights hereunder.

     Section 1.08. Effect of Bankruptcy. In the event that, pursuant to any insolvency, bankruptcy, reorganization, receivership or other debtor relief law, or any judgment, order or decision thereunder, Lender must rescind or restore any payment, or any part thereof, received by Lender in satisfaction of the Guaranteed Debt, any prior release or discharge from the terms of this Guaranty given to Guarantor by Lender shall be without effect, and this Guaranty shall remain in full force and effect. It is the intention of Borrower and Guarantor that Guarantor’s obligations hereunder shall not be discharged except by Guarantor’s performance of such obligations and then only to the extent of such performance

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ARTICLE II

EVENTS AND CIRCUMSTANCES NOT REDUCING OR DISCHARGING
GUARANTOR’S OBLIGATIONS

     Guarantor hereby consents and agrees to each of the following, and agrees that Guarantor’s obligations under this Guaranty shall not be released, diminished, impaired, reduced or adversely affected by any of the following, and Guarantor hereby waives any common law, equitable, statutory or other rights (including without limitation rights to notice) which Guarantor might otherwise have as a result of or in connection with any of the following:

     Section 2.01. Modifications, Etc. Any renewal, extension, increase, modification, assumption, alteration or rearrangement of all or any part of the Guaranteed Debt, or of the Guaranteed Note.

     Section 2.02. Adjustment, Etc. Any adjustment, indulgence, forbearance or compromise that might be granted or given by Lender to Borrower.

     Section 2.03. Invalidity of Guaranteed Debt. The invalidity, illegality or unenforceability of all or any part of the Guaranteed Debt, or any document or agreement executed in connection with the Guaranteed Debt, for any reason whatsoever.

     Section 2.04. Release of Borrower. Any full or partial release of the liability of Borrower.

     Section 2.05. Other Security. The taking or accepting of any other security, collateral or guaranty, or other assurance of payment, for all or any part of the Guaranteed Debt.

     Section 2.06. Release or Sale of Collateral, Etc. Any release, surrender, exchange, subordination, deterioration, waste, loss or impairment of any collateral at any time securing payment of the Guaranteed Debt or any failure to sell the Property or any part of the Property or any collateral in a commercially reasonable manner or as otherwise required by law.

     Section 2.07. Care and Diligence. The failure of Lender or any other person or party to exercise diligence or reasonable care in the preservation, protection, enforcement, sale or other handling or treatment of all or any part of the Property or any collateral at any time securing payment of the Guaranteed Debt.

     Section 2.08. Status of Liens. The fact that any collateral, security, security interest or lien contemplated or intended to be given, created or granted as security for the repayment of the Guaranteed Debt shall not be properly perfected or created, or shall prove to be unenforceable or subordinate to any other security interest or lien.

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     Section 2.09. Offset. Any existing or future right of offset, claim or defense of Borrower against Lender, or any other party, or against payment of the Guaranteed Debt, whether such right of offset, claim or defense arises in connection with the Guaranteed Debt (or the transactions creating the Guaranteed Debt) or otherwise.

     Section 2.10. Merger. The reorganization, merger or consolidation of Borrower into or with any other corporation or entity.

     Section 2.11. Legal Proceedings. The commencement, existence or completion of any proceeding against the Borrower or otherwise related to the collection and enforcement of the Guaranteed Debt.

     Section 2.12. Limitation of Liability. Any limitation on the full personal liability of the Borrower for payment of the Guaranteed Debt or under any document or agreement executed in connection with the Guaranteed Debt.

     Section 2.13. Bankruptcy Proceedings. The receivership, insolvency, bankruptcy or other proceedings affecting Borrower or any its property, Guarantor or any other person or entity.

     Section 2.14. Preference. Any payment by Borrower to Lender is held to constitute a preference under bankruptcy laws, or for any reason Lender is required to refund such payment or pay such amount to Borrowers or any Borrower Party or someone else.

     Section 2.15. Other Actions Taken or Omitted. Any other action taken or omitted to be taken with respect to the Guaranteed Debt, or the security, or the Property, and/or any collateral therefor, whether or not such action or omission prejudices Guarantor or increases the likelihood that Guarantor will be required to pay the Guaranteed Debt pursuant to the terms hereof; it is the unambiguous and unequivocal intention of Guarantor that, subject to the other provisions of this Guaranty, including without limitation, the last sentence of section 1.01 above, Guarantor shall be obligated to pay the Guaranteed Debt when due, notwithstanding any occurrence, circumstance, event, action, or omission whatsoever, whether contemplated or not contemplated, and whether or not otherwise or particularly described herein, except for the full and final payment and satisfaction of the Guaranteed Debt.

ARTICLE III

SUBORDINATION OF CERTAIN INDEBTEDNESS:
WAIVER OF SUBROGATION

     Section 3.01. Subordination of All Guarantor Claims. As used herein, the term “Guarantor Claims” shall mean all debts and liabilities of Borrower to Guarantor, whether now existing or hereafter arising. During the occurrence and continuation of any Event of Default as defined in the Loan Documents (or event or condition which with the giving of notice or passage of time or both would become an Event of Default) under the Guaranteed Note or any of the documents or instruments executed in connection therewith, Guarantor shall not receive or collect, directly or indirectly, any amount upon the Guarantor Claims.

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     Section 3.02. Claims in Bankruptcy. In the event of receivership, bankruptcy, reorganization, arrangement, debtor’s relief, or other insolvency proceedings involving Borrower as debtor, Lender shall have the right to prove its claim in any such proceeding so as to establish its rights hereunder and receive directly from the receiver, trustee or other court custodian dividends and payments which would otherwise be payable upon Guarantor Claims. Guarantor hereby assigns such dividends and payments to Lender.

     Section 3.03. Liens Subordinate. Guarantor agrees that any liens, security interests, judgment liens, charges or other encumbrances upon Borrower’s assets securing payment of any claim by Guarantor shall be subordinate to the Guaranteed Debt.

     Section 3.04. Waiver of Subrogation. Guarantor hereby waives any right, claim or action that it may now or hereafter have against Borrower arising out of, or in connection with, Guarantor’s obligations under this Guaranty or the payment by Guarantor of all or any part of the Guaranteed Debt including, without limitation, any right or claim for subrogation, contribution, reimbursement, exoneration, or indemnity.

ARTICLE IV

MISCELLANEOUS

     Section 4.01. Waiver. No modification or waiver of any provision of this Guaranty or consent to departure therefrom shall be effective unless in writing and no such consent or waiver shall extend beyond the particular case and purpose involved.

     Section 4.02. Notices. Any notices or other communications required or permitted to be given by this Guaranty must be given in writing and shall be deemed to have been given when personally delivered or mailed by prepaid certified or registered mail, return receipt requested, to the party to whom such notice or communication is directed, to the address of such party set forth in the Loan Agreement (or at such other address as may have been designated by written notice pursuant to this Section 4.02).

     Section 4.03. Waiver of Exemptions. By executing this Guaranty, Guarantor, to the maximum extent allowed by law, waives any exemption it may have with respect to enforcement hereof other than homestead exemption it might have with respect to real property owned and/or occupied by Guarantor.

     Section 4.04. GOVERNING LAW/VENUE/JURISDICTION. THIS GUARANTY HAS BEEN PREPARED, AND IS INTENDED TO BE PERFORMED, IN THE STATE OF IOWA AND THE SUBSTANTIVE LAWS OF IOWA SHALL GOVERN THE VALIDITY, CONSTRUCTION, ENFORCEMENT AND INTERPRETATION OF THIS GUARANTY. EACH PARTY IRREVOCABLY SUBMITS ITSELF TO THE JURISDICTION OF THE STATE OF IOWA AND THE IOWA DISTRICT COURT WHERE THE PROPERTY IS LOCATED AND AGREES THAT SAID COURT SHALL BE THE APPROPRIATE VENUE FOR ANY ACTION BROUGHT IN CONNECTION WITH THIS PERSONAL GUARANTY.

     Section 4.05. Invalid Provisions. If any provision of this Guaranty is held to be illegal, invalid, or unenforceable under present or future laws effective during the term of this Guaranty,

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such provision shall be fully severable and this Guaranty shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part of this Guaranty.

     Section 4.06. Entirety and Amendments. There are no unwritten oral agreements between the parties. This Guaranty represents the final agreement between the parties with respect to the matters contained herein and may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties. This Guaranty may be amended only by an instrument in writing executed by an authorized officer of the party against whom such amendment is sought to be enforced.

     Section 4.07. Parties Bound; Assignment. This Guaranty shall be binding upon and inure to the benefit of the parties hereto and their respective successors, assigns and legal representatives; provided, however, that Guarantor may not, without the prior written consent of Lender, assign any of its rights, powers, duties or obligations hereunder.

     Section 4.08. Headings. Section headings are for convenience of reference only and shall in no way affect the interpretation of this Guaranty.

     Section 4.09. Financial Information. Guarantor agrees to deliver to Lender all financial information required to be delivered pursuant to the Loan Agreement.

     Section 4.10. Waiver of Claims/Trial By Jury. GUARANTOR WAIVES ANY CLAIM IT HAS AGAINST LENDER AS MORE FULLY SET FORTH IN THE LOAN AGREEMENT. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING UNDER THE LOAN DOCUMENTS, INCLUDING, WITHOUT LIMITATION, ANY PRESENT OR FUTURE MODIFICATION THEREOF OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THE LOAN DOCUMENTS (AS NOW OR HEREAFTER MODIFIED) OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION IS NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF ANY RIGHT THEY MIGHT OTHERWISE HAVE TO TRIAL BY JURY.

     Section 4.11. Counterparts. This document may be executed in any number of counterparts, each of which shall be an original, but all of which shall constitute one and the same instrument.

IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR ORAL PROMISES NOT

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CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT.

     By signing below, the parties hereto acknowledge that each of them concurrently received of a copy of the documents and each document referenced herein.

     EXECUTED as of the day and year first above written.

[Signature Page Follows]

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GUARANTOR: Steadfast Income REIT, Inc.
By:	/s/  Rodney F. Emery
	Name:	Rodney F. Emery
	Title:	Chief Executive Officer

STATE OF _____________	)
	) SS.
COUNTY OF _________	)

     This instrument was acknowledged before me on this ___ day of December, 2010 by ____________ as ____________ of Steadfast Income REIT, Inc.

[See Attached Certificate]                

Notary Public in and for the State of ______

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EX-10.5

Exhibit 10.5

ASSIGNMENT OF MANAGEMENT AGREEMENT

          THIS ASSIGNMENT OF MANAGEMENT AGREEMENT (“Assignment”) is made and entered into as of this 22nd day of December, 2010, by SIR Park Place, LLC, an Iowa limited liability company, with offices at 18100 Von Karman Avenue, Suite 500, Irvine, California (“Borrower”) (“Borrower”), in favor of Ames Community Bank, with offices at 925 Gateway Drive, Grimes, Iowa 50111 (“Lender”).

W I T N E S S E T H:

          WHEREAS, Borrower and Steadfast Management Company, Inc., a California corporation (the “Manager”) are parties to that certain Property Management Agreement (“Management Agreement”) dated as of December 22, 2010; and

          WHEREAS, Borrower has executed and delivered to Lender a certain Promissory Note dated of even date herewith (the “Note”), payable to the order of Lender in the amount of $5,000,000.00, which Note evidences a loan made by Lender to Borrower (the “Loan”); and

          WHEREAS, the Loan is secured in part by a Mortgage, Assignment of Leases and Rents, Security Agreement, and Fixture Financing Statement (the “Mortgage”). The Mortgage encumbers all right, title and interest in and to the certain tracts of property legally described therein (the “Mortgaged Property”); and

          WHEREAS, as additional security for the Loan, Lender has required an assignment of the interest of Borrower in, to and under the Management Agreement; and

          WHEREAS, Borrower is willing to assign its rights, privileges, powers and interests in, to and under the Management Agreement to Lender upon the conditions herein imposed; and

          WHEREAS, Manager is willing to consent to this Assignment and to attorn to Lender upon a default by Borrower under the documents evidencing and securing the Loan, and perform its obligations under the Management Agreement for Lender, or its successors in interest, or to permit Lender to terminate the Management Agreement without liability.

          NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Borrower agrees as follows:

     1. Borrower hereby transfers, assigns and sets over to Lender, its successors and assigns, all right, title and interest of Borrower in and to the Management Agreement. Manager hereby consents to the foregoing assignment. The foregoing assignment is being made by Borrower to Lender as collateral security for the full payment and performance by Borrower of all of its obligations under the loan documents evidencing and securing the Loan. However, until the occurrence of an Event of Default (as such term is defined in the loan documents

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evidencing and securing the Loan) Borrower may exercise all rights as owner of the Mortgaged Property under the Management Agreement, except as otherwise provided in this Assignment. The foregoing assignment shall remain in effect as long as the Loan, or any part thereof, remains unpaid, but shall automatically terminate upon the release of the Mortgage as a lien on the Mortgaged Property.

     2. Borrower and Manager represent and warrant to Lender that (i) the Management Agreement is unmodified and is in full force and effect, (ii) the Management Agreement is a valid and binding agreement enforceable against the parties in accordance with its terms, and (iii) neither party is in default in performing any of its obligations under the Management Agreement.

     3. Borrower hereby covenants with Lender that during the term of this Assignment: (a) Borrower shall not transfer the responsibility for management of the Mortgaged Property from Manager to any other person or entity without the prior written consent of Lender, which shall not be unreasonably withheld; (b) Borrower shall not terminate or amend any of the terms or provisions of the Management Agreement without the prior written consent of Lender, which shall not be unreasonably withheld; and (c) Borrower shall give Lender written notice of any notice or information that Borrower receives which indicates that Manager is terminating the Management Agreement or that Manager is otherwise discontinuing its management of the Mortgaged Property.

     4. Upon receipt by Manager of written notice from Lender that an Event of Default (as that term is defined in the loan documents evidencing and securing the Loan) has occurred and is continuing, Lender shall have the right to exercise all rights as owner of the Mortgaged Property under the Management Agreement.

     5. After the occurrence of an Event of Default, Lender (or its nominee) shall have the right any time thereafter to terminate the Management Agreement, without cause and without liability, by giving written notice to Manager of its election to do so. Lender’s notice shall specify the date of termination, which shall not be less than 30 days after the date of such notice.

     6. On the effective date of termination of the Management Agreement, Manager shall turn over to Lender all books and records relating to the Mortgaged Property (copies of which may be retained by Manager, at Manager’s expense), together with such authorizations and letters of direction addressed to tenants, suppliers, employees, banks and other parties as Lender may reasonably require. Manager shall cooperate with Lender in the transfer of management responsibilities to Lender or its designee. A final accounting of unpaid fees (if any) due to Manager under the Management Agreement shall be made within 60 days after the effective date of termination, but Lender shall not have any liability or obligation to Manager for unpaid fees or other amounts payable under the Management Agreement which accrue before Lender (or its nominee) acquires title to the Mortgaged Property, or Lender becomes a mortgagee in possession.

     7. Manager’s address for notice is 18100 Von Karman Avenue, Suite 500, Irvine, California. All notices to be given by Lender to Manager shall be given in the same manner as notices to Borrower pursuant to the notice provisions contained in the Mortgage.

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     8. This Assignment may be executed in any number of counterparts, each of which shall be considered an original for all purposes; provided, however, that all such counterparts shall constitute one and the same instrument.

     IN WITNESS WHEREOF, Borrower, Lender and Manager have executed this Assignment as of the day and year first above written.

IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT.

(REMAINDER OF PAGE INTENTIONALLY LEFT BLANK)

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          EXECUTED as of the date first above written.

BORROWER: SIR Park Place, LLC, an Iowa limited liability company by: Steadfast Income Advisor, LLC, its Manager
By:	/s/  James Kasim
	Name:	James Kasim
	Title:	Chief Financial Officer

STATE OF	)
	)	SS.
COUNTY OF	)

     This instrument was acknowledged before me on this ___ day of December, 2010 by                                          as                                          of Steadfast Income Advisor, LLC, the Manager of SIR Park Place, LLC.

[See Attached Certificate]                

Notary Public in and for the State of ______

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LENDER: Ames Community Bank
By:	/s/  Jeff Harder
	Name:	Jeff Harder
	Title:	Vice President

STATE OF IOWA	)
	)	SS.
COUNTY OF POLK	)

     This instrument was acknowledged before me on this 20^th day of December, 2010 by Jeff Harder as Vice President of Ames Community Bank.

/s/  Teri Ruroden                                

Notary Public in and for the State of Iowa               

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MANAGER: Steadfast Management Company, Inc., a California corporation
By:	./s/  Rodney F. Emery
	Name:	Rodney F. Emery
	Title:	Chief Executive Officer

STATE OF IOWA	)
	)	SS.
COUNTY OF	)

     This instrument was acknowledged before me on this ___ day of December, 2010 by ____________ as ____________ of ____________.

[See Attached Certificate]                

Notary Public in and for the State of Iowa               

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EX-10.6

Exhibit 10.6

ENVIRONMENTAL AND HAZARDOUS
SUBSTANCE INDEMNIFICATION AGREEMENT

     THIS ENVIRONMENTAL AND HAZARDOUS SUBSTANCE INDEMNIFICATION AGREEMENT (this “Agreement”), made as of the 22nd day of December 2010, by and between SIR Park Place, LLC, with offices at 18100 Von Karman Avenue, Suite 500, Irvine, California (“Borrower” and/or “Indemnitor”), and Ames Community Bank, with offices at 925 Gateway Drive, Grimes, Iowa 50111 (“Indemnitee”) and other Indemnified Parties (as defined below).

W I T N E S S E T H:

          WHEREAS, pursuant to that certain Loan Agreement dated as of the date hereof, by and between Borrower and Indemnitee (the “Loan Agreement”), Borrower has executed and delivered to Indemnitee that certain Promissory Note dated of even date herewith (the “Note”), payable to the order of Indemnitee in the stated principal amount not exceeding $5,000,000 which Note evidences a Loan made by Indemnitee to Borrower;

          WHEREAS, the Note is secured by that certain Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Financing Statement dated as of the date hereof (the “Security Instrument”), executed by Borrower, encumbering that certain property (the “Property”) more particularly described therein; and

          WHEREAS, Indemnitor will derive substantial benefit from the Loan and Indemnitor enters into this Agreement to induce Indemnitee to make the Loan.

          NOW THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Indemnitor hereby represents, warrants and covenants to the Indemnified Parties (as hereinafter defined) as follows:

          1. Indemnitor, to the best of its knowledge, represents and warrants to the Indemnified Parties that: (a) there are no Hazardous Substances or underground storage tanks in, on, under or about the Property, except those that are both (i) in compliance with Environmental Laws (defined below) (and with permits issued pursuant thereto, if any) and (ii) fully disclosed to Indemnitee in writing pursuant to the written environmental assessments of the Property delivered to Indemnitee (collectively, the “Environmental Report”), (b) except as disclosed in the Environmental Report, no Asbestos is located on the Property; (c) there are no past or present Releases of Hazardous Substances in, on, under or from the Property in violation of any Environmental Law or which would require Remediation under or to achieve compliance with Environmental Laws except as described in the Environmental Report; (d) there is no past or present non-compliance with Environmental Laws, or with permits issued pursuant thereto, in connection with the Property except as described in the Environmental Report; (e) Indemnitor does not know of, and has not received, any notice or other communication from any Person (including a Governmental Authority) alleging noncompliance with or potential liability under Environmental Laws, or other environmental conditions in connection with the Property, or any actual administrative or judicial proceedings in connection with any of the foregoing; (f)

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the Property has not been a site for the use, generation, manufacture, storage, treatment, release, threatened release, discharge, disposal, transportation or presence of Hazardous Substances in violation of Environmental Laws; (g) there are no claims or actions pending or threatened against Indemnitor or the Property by any Governmental Authority or by any other Person relating to Hazardous Substances or pursuant to the Environmental Laws; (h) Indemnitor has truthfully and fully provided to Indemnitee, any and all information relating to environmental conditions in, on, under or from the Property that is known to Indemnitor or that is contained in Indemnitor’s files and records, including any reports relating to Hazardous Substances in, on, under or from the Property and/or to the environmental condition of the Property.

          2. Indemnitor covenants and agrees that: (a) all uses and operations on or of the Property, whether by Indemnitor or any other Person including any Tenant, shall be in compliance with all Environmental Laws and permits issued pursuant thereto; (b) there shall be no Releases of Hazardous Substances in, on, under or from the Property; (c) the Property shall not be used as a site for the use, generation, manufacture, storage, treatment, releases, discharge and/or transportation of Hazardous Substances, and there shall be no Hazardous Substances in, on, or under the Property, in each case except those that are stored, used or maintained in compliance with all Environmental Laws and with permits issued pursuant thereto, if and to the extent required; (d) Indemnitor shall keep the Property free and clear of all Liens and other encumbrances imposed pursuant to any Environmental Law, whether due to any act or omission of Indemnitor or any other Person (the “Environmental Liens”); and (e) Indemnitor shall, at its sole cost and expense, fully and expeditiously cooperate in all activities pursuant to Section 3 below, including providing all relevant information and making knowledgeable persons available for interviews. Indemnitor shall in all instances comply with, and ensure compliance by all occupants of the Property with, all applicable Legal Requirements with respect to Asbestos and other Hazardous Substances, and shall keep the Property free and clear of any Liens imposed pursuant to such Legal Requirements. In the event that Indemnitor receives any notice or communication from any Governmental Authority or any source whatsoever with respect to Asbestos or any other Hazardous Substances on, affecting or installed on the Property, Indemnitor shall immediately notify Indemnitee.

          3. (a) Indemnitee, its environmental consultant, and any other Person designated by Indemnitee, including any receiver and any representative of a Governmental Authority, shall have the right, but not the obligation, at intervals of not less than one year, or more frequently if the Indemnitee reasonably believes that a Hazardous Substance or other environmental condition violates or threatens to violate any Environmental Law, after notice to Indemnitor, to enter upon the Property at all reasonable times to assess any and all aspects of the environmental condition of the Property and its use, including conducting any environmental assessment or audit of the Property or portions thereof to confirm Indemnitor’s compliance with this Agreement, and Indemnitor shall cooperate in all reasonable ways with Indemnitee in connection with any such assessment or audit. Such audit shall be performed in a manner so as to minimize interference with the conduct of business at the Property. If such assessment or audit discloses the existence of a violation of any Environmental Law or the possibility of any potential liability under any Environmental Law or if such audit was required or prescribed by law, regulation or Governmental or quasi-

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Governmental Authority, Indemnitor shall pay all reasonable costs and expenses incurred in connection with such assessment or audit; otherwise, the costs and expenses of such audit shall, notwithstanding anything to the contrary set forth in this Agreement, be paid by Indemnitee.

               (b) Indemnitor shall give prompt written notice to Indemnitee of: (a) any proceeding or inquiry by any Person with respect to the presence of any Hazardous Substances on, under, from or about the Property, (b) all claims made or threatened by any Person against Indemnitor or the Property relating to any loss or injury resulting from any Hazardous Substance, (c) Indemnitor’s discovery of any occurrence or condition on any real property adjoining or in the vicinity of the Property that could cause the Property to be subject to any investigation or cleanup pursuant to any Environmental Law, and (d) any violation of Environmental Laws by any other Person of which Borrower has knowledge if same may affect the Property. In the event that any environmental site assessment or report recommends that an operations and maintenance plan or program be implemented for Asbestos or any other Hazardous Substance, Indemnitor shall cause such operations and maintenance plan to be prepared and implemented at Indemnitor’s sole cost and expense upon request of Indemnitee within thirty (30) days after such recommendation. In the event that any investigation, site monitoring, containment, cleanup, removal, Remediation, restoration or other work of any kind is required under an applicable Environmental Law (the “Remedial Work”), Indemnitor shall commence and thereafter diligently prosecute to completion any Remedial Work within thirty (30) days after written demand by Indemnitee for performance thereof (or such shorter period of time as may be required under applicable law). All Remedial Work shall be performed by contractors approved in advance by Indemnitee. Unless the cost of the Remedial Work is to be paid by a governmental program or by proceeds of a policy of insurance, all costs and expenses of such Remedial Work shall be paid by Indemnitor, including Indemnitee’s reasonable attorneys’ fees and costs and engineer consulting fees of engineers and other professionals incurred in connection with monitoring or review of such Remedial Work. In the event Indemnitor shall fail to timely commence, or cause to be commenced, or fail to diligently prosecute to completion, such Remedial Work, Indemnitee may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith, shall be paid by Indemnitee.

          4. (a) Except to the extent arising out of the negligence or willful misconduct of the Indemnified Parties, Indemnitor shall, at its sole cost and expense, protect, defend, indemnify, release and hold harmless the Indemnified Parties from and against any and all Losses imposed upon or incurred by or asserted against any Indemnified Parties, and arising out of or in connection with or in any way relating to any one or more of the following: (i) any presence of any Hazardous Substances in, on, above or under the Property; (ii) any past, present or threatened Release of Hazardous Substances in, on, above, under or from the Property; (iii) any activity by Indemnitor, any Person affiliated with Indemnitor, any Tenant or other users of the Property or any other Person in connection with any actual, proposed or threatened use, treatment, storage, holding, existence, disposition or other Release, generation, production, manufacturing, processing, refining, control, management, abatement, removal, handling, transfer or transportation to or from the Property of any Hazardous Substances at any time located in, under, on or above the Property; (iv) any

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activity by Indemnitor, any Affiliate of Indemnitor or any Tenant or other users of the Property in connection with any actual or proposed Remediation of any Hazardous Substances at any time located in, under, on or above the Property, whether or not such Remediation is voluntary or pursuant to court or administrative order, including any removal, remedial or corrective action; (v) any past, present or threatened violations of any Environmental Laws (or permits issued pursuant to any Environmental Law) in connection with the Property or operations thereon, including any failure by Indemnitor, any Affiliate of Indemnitor or any Tenant or other users of the Property to comply with any order of any Governmental Authority in connection with Environmental Laws; (vi) the imposition, recording or filing of any Environmental Lien encumbering the Property; (vii) any administrative processes or proceedings or judicial proceedings in any way connected with any matter addressed in this Agreement; (viii) any past, present or threatened injury to, destruction of or loss of natural resources in any way connected with the Property, including costs to investigate and assess such injury, destruction or loss; (ix) any acts of Indemnitor or other users of the Property, in accepting any Hazardous Substances for transport to disposal or treatment facilities, incineration vessels or sites selected by Indemnitor or such other users, from which there is a Release, or a threatened Release of any Hazardous Substance which causes the incurrence of costs for Remediation; (x) any personal injury, wrongful death, or property damage caused by Hazardous Substances arising under any statutory or common law or tort law theory, including damages assessed for the maintenance of a private or public nuisance or for the conducting of an abnormally dangerous activity on or near the Property; and (xi) any misrepresentation in any representation or warranty or breach or failure to perform any covenants or other obligations pursuant to this Agreement.

               (b) Upon written request by any Indemnified Party, Indemnitor shall defend such Indemnified Party (if requested by any Indemnified Party, in the name of the Indemnified Party) by attorneys and other professionals approved by the Indemnified Parties.

          5. The term “Hazardous Substances” means any and all substances, materials or wastes (whether solid, liquid or gas) defined, listed, or otherwise classified as pollutants, contaminants, toxic substances, hazardous wastes, hazardous substances, hazardous materials, extremely hazardous wastes, or words of similar meaning or regulatory effect under any present or future Environmental Laws, including, but not limited to, urea formaldehyde insulation, medical wastes, petroleum and petroleum products, Asbestos and Asbestos-containing materials, polychlorinated biphenyls, lead, radon, radioactive materials, fungicides, insecticides, rodenticides, pesticides, flammables and explosives. The term “Asbestos” means asbestos or any substance or material containing asbestos.

          6. The term “Environmental Law” means any present or future, federal, state and local laws, statutes, ordinances, rules, regulations and the like, as well as common law, relating to protection of human health, the environment or natural resources, Hazardous Substances, liability for or costs of Remediation or prevention of Releases of Hazardous Substances or otherwise relating to liability for or costs of other actual or threatened danger to human health or the environment, and includes, but is not limited to, the following statutes, as amended, any successor thereto, and any regulations promulgated pursuant thereto, and any state or local statutes, ordinances, rules, regulations and the like addressing similar issues: the Comprehensive Environmental Response, Compensation and Liability Act

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of 1980, as amended (including Superfund Amendments and Reauthorization Act of 1986, “CERCLA”), 42 U.S.C. Section 9601 et seq.; the Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et seq.; the Hazardous Substances Transportation Act; the Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section 6901 et seq. (including Subtitle I relating to underground storage tanks); the Solid Waste Disposal Act; the Clean Water Act; the Clean Air Act, as amended 42 U.S.C. Section 7401 et seq; the Toxic Substances Control Act, as amended, 15 U.S.C. Section 2601 et seq.; the Safe Drinking Water Act, as amended, 42 U.S.C. Section 300f et seq.; the Occupational Safety and Health Act, as amended, 29 U.S.C. Section 651; the Federal Water Pollution Control Act, as amended, 33 U.S.C. Section 1251 et seq.; the Federal Insecticide, Fungicide and Rodenticide Act; the Endangered Species Act; the National Environmental Policy Act; and the River and Harbors Appropriation Act. “Environmental Law” also includes, but is not limited to, any present or future, federal, state and local laws, statutes, ordinances, rules, regulations and the like, as well as common law; conditioning transfer of property upon a negative declaration or other approval of a Governmental Authority of the environmental condition of the property; and requiring notification or disclosure of Releases of Hazardous Substances or other environmental condition of the Property to any Governmental Authority or other Person , whether or not in connection with transfer of title to or interest in property.

          7. The term “Release” of any Hazardous Substance means any release, deposit, discharge, emission, leaking, spilling, seeping, migrating, injecting, pumping, pouring, emptying, escaping, dumping, disposing or other movement of Hazardous Substances.

          8. The term “Remediation” includes, but is not limited to, any response, remedial removal, or corrective action, any activity to cleanup, detoxify, decontaminate, contain or otherwise remediate any Hazardous Substance, any actions to prevent, cure or mitigate any Release of any Hazardous Substance, any action to comply with any Environmental Laws or with any permits issued pursuant thereto, any inspection, investigation, study, monitoring, assessment, audit, sampling and testing, laboratory or other analysis, or evaluation relating to any Hazardous Substances.

          9. The term “Indemnified Parties” means Indemnitee and in each case any other Person designated by Lender (i) who is or will have been involved in the origination of the Loan and/or participation in the Loan, (ii) who is or will have been involved in the servicing of the Loan, (iii) in whose name the encumbrance created by the Security Instrument is or will have been recorded, (iv) who may hold or acquire or will have held a full or partial interest in the Loan (including pursuant to a pledge or collateral assignment) as well as the respective directors, officers, shareholders, members, partners, employees, agents, servants, representatives, contractors, subcontractors, Affiliates, subsidiaries, successors and assigns of any and all of the foregoing (including any other Person who holds or acquires or will have held a participation or other full or partial interest in the Loan or the Property, whether during the term of the Loan or as a part of or following a foreclosure of the Loan and including any successors by merger, consolidation or acquisition of all or a substantial portion of Indemnitee’s assets and business), and/or (v) who is controlling, controlled by or

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under common control with any Person described in clauses (i)-(iv). The term “Indemnified Party” shall mean any one of the Indemnified Parties.

          10. The term “Losses” includes any and all claims, actions, suits, liabilities (including strict liabilities), actions, proceedings, obligations, debts, damages, losses, costs, expenses, diminutions in value, fines, penalties, charges, fees, expenses, judgments, awards, amounts paid in settlement, costs of Remediation (whether or not performed voluntarily), engineers’ fees, environmental consultants’ fees, and costs of investigation (including sampling, testing and analysis of soil, water, air, building materials and other materials and substances whether solid, liquid or gas) or punitive damages, of whatever kind or nature (including reasonable attorneys’ fees and other costs of defense). Losses shall include, without limitation to the foregoing, the following: (a) all Remediation costs and expenses, and (b) all other direct or indirect consequential damages, including, without limitation, any third party tort claims or governmental claims, fines or penalties against an Indemnified Party, or any Person controlled by an Indemnified Party.

          11. The liability of Indemnitor under this Agreement shall in no way be limited or impaired by, and Indemnitor hereby consents to and agrees to be bound by, any amendment or modification (whether or not such Indemnitor has received notice thereof) of the provisions of the Loan Documents or any other agreement to or with Indemnitee or Indemnitor or any Person who succeeds Indemnitor or Borrower as owner of the Property.

          12. Indemnitee may enforce the obligations of Indemnitor without first resorting to or exhausting any security or collateral or without first having recourse to the Note, the Security Instrument, or any other Loan Documents or any of the Property, through foreclosure proceedings or otherwise. This Agreement shall also constitute collateral and security for the debt of Borrower pursuant to the Loan and shall be secured by the Security Instrument. It is not necessary for an Event of Default to have occurred for Indemnified Parties to exercise their rights pursuant to this Agreement.

          13. The term of the indemnity provided for herein will commence on the date hereof and continue until such time as no legal action can be successfully brought against Indemnitee and/or any Indemnified Party due to applicable statutes of limitation. WITHOUT IN ANY WAY LIMITING THE ABOVE, IT IS EXPRESSLY UNDERSTOOD THAT INDEMNITOR’S DUTY TO INDEMNIFY THE INDEMNIFIED PARTIES SHALL SURVIVE: (i) ANY JUDICIAL OR NON-JUDICIAL FORECLOSURE UNDER THE SECURITY INSTRUMENT, OR TRANSFER OF THE PROPERTY IN LIEU THEREOF; (ii) THE RELEASE AND RECONVEYANCE OR CANCELLATION OF THE SECURITY INSTRUMENT; AND (iii) THE SATISFACTION OF ALL OF BORROWER’S OBLIGATIONS UNDER THE LOAN DOCUMENTS.

          14. Any amounts payable to Indemnitee under this Agreement shall become immediately due and payable and, if not paid within ten (10) days of written demand therefor shall bear interest at the rate equal to the lesser of (a) the Default Rate (as defined in the Note), or (b) the maximum interest rate which Borrower or any other Indemnitor may by law pay or Indemnified Parties may charge and collect, from the date payment was due.

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          15. Indemnitor shall take any and all reasonable actions, including institution of legal action against third parties, necessary or appropriate to obtain reimbursement, payment or compensation from such Persons responsible for the presence of any Hazardous Substances at, in, on, under or near the Property or otherwise obligated by law to bear the cost. Indemnitee shall be and hereby is subrogated to all of Indemnitor’s rights now or hereafter in such claims.

          16. Indemnitor shall cooperate with Indemnitee, and provide access to Indemnitee and any professionals engaged by Indemnitee, upon Indemnitee’s request, to conduct, contract for, evaluate or interpret any environmental assessments, audits, investigations, testing, sampling, analysis and similar procedures on the Property.

          18. No delay on Indemnitee’s part in exercising any right, power or privilege under this Agreement shall operate as a waiver of any such privilege, power or right.

          17. Indemnitor shall, within five (5) business days of receipt thereof, give written notice to the Indemnitee of (i) any notice or advice from any Governmental Authority or any source whatsoever with respect to Hazardous Substances on, from or affecting the Property, and (ii) any claim, suit or proceeding, whether administrative or judicial in nature (“Legal Action”), brought against the Indemnitor or instituted with respect to the Property, with respect to which Indemnitor may have liability under this Agreement. Such notice shall comply with the provisions of paragraph 24 hereof.

          18. Indemnitee shall, at all times, be free to independently establish to its satisfaction and in its absolute discretion the compliance with the terms of this Agreement, including random inspections on a reasonable basis so long as such inspections do not unreasonably interfere with the rights of any Tenant in the Property.

          19. To the extent applicable, Indemnitor has filed all federal, state, county, municipal, and city income and other tax returns required to have been filed by it and has paid all taxes and related liabilities which have become due pursuant to such returns or pursuant to any assessments received by it. No Indemnitor knows of any basis for any additional assessment in respect of any such taxes and related liabilities for prior years.

          20. All notices given under this Agreement shall be given and become effective as provided in the Loan Agreement.

          21. The terms of this Agreement are for the sole and exclusive protection and use of Indemnitee and the Indemnified Parties. No party shall be a third-party beneficiary hereunder, and no provision hereof shall operate or inure to the use and benefit of any such third party. It is agreed that Indemnified Parties are not such excluded third-party beneficiaries.

          22. Capitalized terms used herein and not specifically defined herein shall have the respective meanings ascribed to such terms in the Loan Agreement or Loan Documents.

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          23. This Agreement may be executed in several counterparts, each of which counterparts shall be deemed an original instrument and all of which together shall constitute a single Agreement. The failure of any party hereto to execute this Agreement, or any counterpart hereof, shall not relieve the other signatories from their obligations hereunder.

          24. This Agreement may not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or failure to act on the part of Indemnitee, but only by an agreement in writing signed by the party against whom enforcement of any modification, amendment, waiver, extension, change, discharge or termination is sought.

          25. Any one or more parties liable upon or in respect of this Agreement may be released without affecting the liability of any party not so released.

          26. The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies which Indemnitee has under the Note, the Security Instrument, or the other Loan Documents or would otherwise have at law or in equity.

          27. If any term, condition or covenant of this Agreement shall be held to be invalid, illegal or unenforceable in any respect, this Agreement shall be construed without such provision.

          28. THIS AGREEMENT SHALL BE GOVERNED BY, AND INTERPRETED AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF IOWA.

          29. The rights of Indemnitee under this Agreement shall be in addition to any other rights and remedies of Indemnitee against Indemnitor under any other document or instrument now or hereafter executed by Indemnitor, or at law or in equity (including, without limitation, any right of reimbursement or contribution pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. Section 9601 et seq., as heretofore or hereafter amended from time to time), or the environmental laws of the state of Iowa.

IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT.

By signing below, the parties hereto acknowledge that it concurrently received of a copy of the documents and each document referenced herein.

          IN WITNESS WHEREOF, Borrower has duly executed this Agreement the day and year first above written.

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BORROWER:
SIR Park Place, LLC, an Iowa limited liability company by: Steadfast Income Advisor, LLC, its Manager
By:	/s/  James Kasim
	Name:	James Kasim
	Title:	Chief Financial Officer

STATE OF	)
	)	SS.
COUNTY OF	)

     This instrument was acknowledged before me on this ___ day of December, 2010 by ____________ as ____________of Steadfast Income Advisor, LLC, the Manager of SIR Park Place, LLC.

[See Attached Certificate]                

Notary Public in and for the State of ______

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EX-10.7

Exhibit 10.7

PROPERTY MANAGEMENT AGREEMENT

     THIS PROPERTY MANAGEMENT AGREEMENT (this “Agreement”) is made and entered into as of December 22nd, 2010 (the “Effective Date”), by and between SIR PARK PLACE, LLC, an Illinois limited liability company (“Owner”), and STEADFAST MANAGEMENT CO., INC., a California corporation (“Manager”).

ARTICLE 1
DEFINITIONS

     Section 1.1 Definitions. The following terms shall have the following meanings when used in this Agreement:

     “Agreement” has the meaning given in the introductory paragraph.

     “Annual Business Plan” has the meaning given in Section 3.11(a).

     “Capital Budget” has the meaning given in Section 3.11(a).

     “Depository” means such bank or federally-insured or other financial institution as Owner shall designate in writing.

     “Effective Date” has the meaning given in the introductory paragraph.

     “Fiscal Year” means the calendar year beginning January 1 and ending December 31 of each calendar year, or such other fiscal year as determined by Owner and of which Manager is notified in writing; provided that the first Fiscal Year of this Agreement shall be the period beginning on the Effective Date and ending on December 31 of the calendar year in which the Effective Date occurs.

     “Governmental Requirements” has the meaning given in Section 3.14.

     “Gross Collections” means all amounts actually collected as rents or other charges for use and occupancy of apartment units and from users of garage spaces (if any), leases of other non-dwelling facilities in the Property and concessionaires (if any) in respect of the Property, including furniture rental, parking fees, forfeited security deposits, application fees, late charges, income from coin-operated machines, proceeds from rental interruption insurance, and other miscellaneous income collected at the Property; excluding, however, all other receipts, including but not limited to, income derived from interest on investments or otherwise, proceeds of claims on account of insurance policies (other than rental interruptions insurance), abatement of taxes, franchise fees, and awards arising out of eminent domain proceedings, discounts and dividends on insurance policies.

     “Hazardous Materials” means any material defined as a hazardous substance under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, the Resource Conservation and Recovery Act, or any state or local statute regulating the storage, release, transportation or other disposition of hazardous material, as any of those laws may have been amended to the date hereof, and the administrative regulations promulgated thereunder prior to

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the date hereof, and, whether or not defined as hazardous substances under the foregoing Governmental Requirements, petroleum products (other than petroleum products used in accordance with Governmental Requirements by Owner or its tenants in the usual and ordinary course of their activities), PCBs and radon gas.

     “Major Capital Improvements” has the meaning given in Section 3.6.

     “Management Fee” has the meaning given in Section 4.1.

     “Manager” has the meaning given in the introductory paragraph.

     “Operating Budget” has the meaning given in Section 3.11(a).

     “Owner” has the meaning given in the introductory paragraph.

     “Owner’s Representative” has the meaning given in Section 2.2.

     “Property” means the multifamily apartment project listed and described on Exhibit A attached hereto and made a part hereof.

     “Security Deposit Account” has the meaning given in Section 2.3.

     “State” means the state in which the Property is located.

ARTICLE 2
APPOINTMENT OF AGENCY AND RENTAL RESPONSIBILITY

     Section 2.1 Appointment. Owner hereby appoints Manager and Manager hereby accepts appointment as the sole and exclusive leasing agent and manager of the Property on the terms and conditions set forth herein. Owner warrants and represents to Manager that Owner owns fee simple title to the Property with all requisite authority to hereby appoint Manager and to enter into this Agreement.

     Section 2.2 Owner’s Representative. Owner shall from time to time designate one or more persons to serve as Owner’s representative (“Owner’s Representative”) in all dealings with Manager hereunder. Whenever the approval, consent or other action of Owner is called for hereunder, such approval, consent or action shall be binding on Owner if specified in writing and signed by Owner’s Representative. The initial Owner’s Representative shall be Kyle Winning. Any Owner’s Representative may be changed at the discretion of Owner, at any time, and shall be effective upon Manager’s receipt of written notice identifying the new Owner’s Representative.

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     Section 2.3 Leasing. Manager shall perform all promotional, leasing and management activities required to lease apartment units in the Property. Throughout the term of this Agreement, Manager shall use its diligent efforts to lease apartment units in the Property. Manager shall advertise the Property, prepare and secure advertising signs, space plans, circulars, marketing brochures and other forms of advertising. Owner hereby authorizes Manager pursuant to the terms of this Agreement to advertise the Property in conjunction with institutional advertising campaigns and allocate costs on a pro rata basis among the Properties being advertised (to the extent authorized by the Annual Business Plan). All inquiries for any leases or renewals or agreements for the rental of the Property or portions thereof shall be referred to Manager and all negotiations connected therewith shall be conducted solely by or under the direction of Manager. Manager is hereby authorized to execute, deliver and renew residential tenant leases on behalf of Owner. Manager is authorized to utilize the services of apartment locator services and the fees of such services shall be operating expenses of the Property and, to the extent paid by Manager, reimbursable by Owner.

     Section 2.4 Manager’s Standard of Care. Manager shall perform its duties under this Agreement in a manner consistent with professional property management services. In no event shall the scope or quality of services provided by Manager for the Property hereunder be less than those generally performed by professional property managers of similar properties in the market area where the Property is located. Manager shall make available to Owner the full benefit of the judgment, experience, and advice of the members and employees of Manager’s organization with respect to the policies to be pursued by Owner in operating the Property, and will perform the services set forth herein and such other services as may be requested by Owner in managing, operating, maintaining and servicing the Property.

ARTICLE 3
SERVICES TO BE PERFORMED BY MANAGER

     Section 3.1 Expense of Owner. All acts performed by Manager in the performance of its obligations under this Agreement shall be performed as an independent contractor of Owner, and all obligations or expenses incurred thereby, shall be for the account of, on behalf of, and at the expense of Owner, except as otherwise specifically provided in this Article 3, provided Owner shall be obligated to reimburse Manager only for the following:

          (a) Costs and Expenses. All costs and expenses incurred by Manager on behalf of Owner in connection with the management and operation of the Property, including but not limited to all compensation payable to the employees at the Property and identified in the Operating Budget and taxes and assessments payable in connection therewith and reasonable travel and expenses associated therewith, all marketing costs, all collection and lease enforcement costs, all maintenance and repair costs incurred in accordance with Section 3.5 hereof, all utilities and related services, all on-site overhead costs and all other costs reasonably incurred by Manager in the operation and management of the Property, excluding, however, all of Manager’s general overhead costs, including without limitation, all expenses incurred at Manager’s corporate headquarters and other Manager office sites other than the property management office located at the Property (i.e., office expenses, long distance phone calls, employee training, postage, copying, supplies, electronic data processing and accounting

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expenses), general accounting and reporting expenses for services included among Manager’s duties under the Agreement; and

          (b) Other. All sums otherwise due and payable by Owner as expenses of the Property authorized to be incurred by Manager under the terms of this Agreement and the Operating Budget, including compensation payable under Section 4.1 hereof to Manager for its services hereunder.

     Manager may use employees normally assigned to other work centers or part-time employees to properly staff the Property, reduced, increased or emergency work load and the like including the property manager, business manager, assistant managers, leasing directors, or other administrative personnel, maintenance employees or maintenance supervisors whose wages and related expenses shall be reimbursed on a pro rata basis for the time actually spent at the Property. A property manager or business manager at the Property and any other persons performing functions substantially similar to those of a business manager, including but not limited to assistant managers, leasing directors, leasing agents, sales directors, sales agents, bookkeepers, and other administrative and/or maintenance personnel performing work at the site, and on-site maintenance personnel, shall not be considered executive employees of Manager. All reimbursable payments made by Manager hereunder shall be reimbursed from funds deposited in an account established pursuant to Section 5.2 of this Agreement. Manager shall not be obligated to make any advance to or for the account of Owner nor shall Manager be obligated to incur any liability or obligation for the account of Owner without assurance that the necessary funds for the discharge thereof will be provided by Owner. In the performance of its duties as agent and manager of the Property, Manager shall act solely as an independent contractor of Owner. All debts and liabilities to third persons incurred by Manager in the course of its operation and management of the Property shall be the debts and liabilities of Owner only, and Manager shall not be liable for any such debt or liabilities, except to the extent Manager has exceeded its authority hereunder.

     Section 3.2 Covenants Concerning Payment of Operating Expenses. Owner covenants to pay all sums for reasonable operating expenses in excess of gross receipts required to operate the Property upon written notice and demand from Manager within five days after receipt of written notice for payment thereof.

     Section 3.3 Employment of Personnel. Manager shall use its diligent efforts to investigate, hire, pay, supervise and discharge the personnel necessary to be employed by it to properly maintain, operate and lease the Property, including without limitation a property manager or business manager at the Property. Such personnel shall in every instance be deemed agents or employees, as the case may be, of Manager. Owner has no right of supervision or direction of agents or employees of Manager whatsoever; however, Owner shall have the right to require the reassignment or termination of any employee. All Owner directives shall be communicated to Manager’s senior level management employees. Manager and all personnel of Manager who handle or who are responsible for handling Owner’s monies shall be bonded in favor of Owner. Manager agrees to obtain and keep in effect fidelity insurance in an amount not less than Two Hundred Fifty Thousand Dollars ($250,000). All reasonable salaries, wages and other compensation of personnel employed by Manager, including so-called fringe benefits, worker’s compensation, medical and health insurance and the like, shall be deemed to be

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reimbursable expenses of Manager. Manager may allow its employees who work at the Property and provide services to the Property after normal business hours, to reside at the Property for reduced rents (or rent fee as provided in the Operating Budget) in consideration of their benefit to Owner and the Property, provided such reduced rents are reflected in the Annual Business Plan.

     Section 3.4 Utility and Service Contracts. Manager shall make, at Owner’s expense and in Owner’s name or in Manager’s name, as agent for Owner, contracts for water, electricity, gas, fuel, oil, telephone, vermin extermination, trash removal, cable television, security protection and other services deemed by Manager to be necessary or advisable for the operation of the Property. In Owner’s name or in Manager’s name, as agent for Owner, and at Owner’s expense, Manager shall also place orders for such equipment, tools, appliances, materials, and supplies as are reasonable and necessary to properly maintain the Property. Owner agrees to pay or reimburse Manager for all expenses and liabilities incurred by reason of this Section provided that such amounts are in accordance with the Operating Budget.

     Section 3.5 Maintenance and Repair of Property. Manager shall use its diligent efforts to maintain, at Owner’s expense, the buildings, appurtenances and grounds of the Property in good condition and repair, including interior and exterior cleaning, painting and decorating, plumbing, carpentry and such other normal maintenance and repair work as may be reasonably desirable taking into consideration the amount allocated therefor in the Annual Business Plan. With respect to any expenditure not contemplated by the Annual Business Plan, Manager shall not incur any individual item of repair or replacement in excess of Five Thousand Dollars ($5,000.00) unless authorized in writing by Owner’s Representative, excepting, however, that emergency repairs immediately necessary for the preservation and safety of the Property or to avoid the suspension of any service to the Property or danger of injury to persons or damage to property may be made by Manager without the approval of Owner’s Representative. Owner shall not establish standards of maintenance and repair that violate or may violate any laws, rules, restrictions or regulations applicable to Manager or the Property or that expose Manager to risk of liability to tenants or other persons. Manager shall not be obligated by this Section to perform any Major Capital Improvements.

     Section 3.6 Supervision of Capital Improvements or Major Repairs. When requested by Owner in writing or set forth in an Approved Business Plan, Manager, at Owner’s expense and in Owner’s name or in Manager’s name, as agent for Owner, shall supervise the installation and construction of all Major Capital Improvements to the Property where such work constitutes other than normal maintenance and repair, for additional compensation as set forth in a separate agreement. In such events, Manager may negotiate contracts with all necessary contractors, subcontractors, materialmen, suppliers, architects, and engineers on behalf of, and in the name of, Owner, and may compromise and settle any dispute or claim arising therefrom on behalf of and in the name of Owner; provided only that Manager shall act in good faith and in the best interest of Owner at all times and Owner shall approve all contracts for such work. Manager will furnish or will cause to be furnished all personnel necessary for proper supervision of the work and may assign personnel located at the Property where such work is being performed to such supervisory work (and such assignment shall not reduce or abate any other fees or compensation owed to Manager under this Agreement). Owner acknowledges that Manager, or an affiliate of Manager, may bid on any such work, and that Manager, or an affiliate

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of Manager, may be selected to perform part or all of the work; provided that if Manager desires to select itself, or its affiliate to do any work, it shall first notify Owner of the terms upon which it, or its affiliate, proposes to contract for the work, and terms upon which the independent contractors have offered to perform, and shall state the reasons for preferring itself, or its affiliate, over independent contractors and Owner shall have fifteen days to disapprove Manager, or its affiliate, and to request performance by an independent contractor. Only Owner shall have the power to compromise or settle any dispute or claim arising from work performed by Manager, or its affiliate; and it is expressly understood that the selection of Manager, or its affiliate, will not affect any fee or other compensation payable to Manager hereunder. For the purposes of this Agreement, the term “Major Capital Improvements” shall mean work having an estimated cost of $25,000 or more. If Owner and Manager fail to reach an agreement for Manager’s additional compensation as provided in this Section 3.6, Owner may contract with a third party to supervise installation or construction of Major Capital Improvements.

     Section 3.7 Insurance.

          (a) Owner Requirements. Owner agrees to maintain all forms of insurance required by law or any loan documents covering the Property and as reasonably deemed by Owner to be necessary or needed to adequately protect Owner and Manager, including but not limited to public liability insurance, boiler insurance, fire and extended coverage insurance, and burglary and theft insurance. All insurance coverage shall be placed with such companies, in such amounts and with such beneficial interest appearing therein as shall be reasonably acceptable to Owner. Public liability insurance shall be maintained in such amounts as Owner determines as commercially reasonable or as otherwise required by its lenders or investors.

          (b) Manager Requirements. Manager agrees to maintain, at its own expense, public liability insurance in an amount not less than Three Million Dollars ($3,000,000) and all other forms of insurance required by law or any loan documents covering the Property and as reasonably deemed by Owner and Manager to be necessary or needed to adequately protect Owner and Manager, including but not limited to workers compensation insurance, professional liability, employee practices, and fidelity insurance. Manager shall use its diligent efforts to investigate and make a written report to the insurance company as to all accidents, claims for damage relating to the ownership, operation and maintenance of the Property, any damage or destruction to the Property and the estimated cost of repair thereof, and shall prepare any and all reports for any insurance company in connection therewith. All such reports shall be timely filed with the insurance company as required under the terms of the insurance policy involved. With the prior written approval of Owner, Manager is authorized to settle any and all claims against insurance companies arising out of any policies, including the execution of proofs of loss, the adjustment of losses, signing of receipts and collection of monies (no approval by Owner shall be required for the settlement of claims of $5,000 or less). Manager is further authorized to contract for the maintenance and repair of any damage or casualty in accordance with Section 3.6 above. Manager shall receive as an additional fee for such services that fee designated in the loss adjustment as a general contractor’s fee, provided that insurance proceeds that exceed the cost of repairing the damage or restoring the loss are available to pay such fees. In such event Manager shall be responsible for all costs incurred by Manager in adjusting such loss and contracting for repairs.

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          (c) Loss or Liability Claims. Owner and Manager mutually agree for the benefit of each other to look only to the appropriate insurance coverages in effect pursuant to this Agreement in the event any demand, claim, action, damage, loss, liability or expense occurs as a result of injury to person or damage to property, regardless whether any such demand, claim, action, damage, loss, liability or expense is caused or contributed to, by or results from the negligence of Owner or Manager or their respective subsidiaries, affiliates, employees, directors, officers, agents or independent contractors and regardless whether the injury to person or damage to property occurs in and about the Property or elsewhere as a result of the performance of this Agreement. Except for claims that are covered by the indemnity contained in Section 3.7(d) below, Owner agrees that Owner’s insurance shall be primary without right of subrogation against Manager with respect to all claims, actions, damage, loss or liability in or about the Property. Nevertheless, in the event such insurance proceeds are insufficient to satisfy (or such insurance does not cover) the demand, claim, action, loss, liability or expense, Owner agrees, at its expense, to indemnify and hold Manager and its subsidiaries, affiliates, officers, directors, employees, agents or independent contractors harmless to the extent of the excess liability. For purposes of this Section 3.7(c), any deductible amount under any policy of insurance shall not be deemed to be included as part of collectible insurance proceeds.

          (d) Manager Indemnity. Notwithstanding anything contained in this Agreement to the contrary, Manager shall indemnify and hold harmless Owner, and its representative subsidiaries, affiliates, officers, directors, employees, agents or independent contractors, from all demands, claims, actions, losses, liabilities or expenses that are not covered by insurance and which is determined to have resulted from the gross negligence, willful misconduct or breach of this Agreement by Manager in connection with the performance of its duties and obligations under this Agreement.

          (e) Acts of Tenants and Third Parties. In no event shall Manager have any liability to Owner or others for any acts of vandalism, trespass or criminal activity of any kind by tenants or third parties on or with respect to the Property and Owner’s insurance shall be primary insurance without right of subrogation against Manager regarding claims arising out of or resulting from acts of vandalism, trespass or criminal activity.

     Section 3.8 Collection of Monies. Manager shall use its diligent efforts to collect all rents and other charges due from tenants, users of garage spaces, carports, storage spaces (if any), commercial lessees (if any) and concessionaires (if any) in respect of the Property and otherwise due Owner with respect to the Property in the ordinary course of business, provided that Manager does not guarantee the creditworthiness of any tenants, users, lessees or concessionaires or collectability of accounts receivable from any of the foregoing. Owner authorizes Manager to request, demand, collect, receive and receipt for all such rent and other charges and to institute legal proceedings in the name of Owner, and at Owner’s expense, for the collection thereof, and for the dispossession of tenants and other persons from the Property or to cancel or terminate any lease, license or concession agreement for breach or default thereunder, and such expense may include the engaging of legal counsel for any such matter. All monies collected by Manager shall be deposited in the separate bank account referred to in Section 5.2 herein.

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     Section 3.9 Manager Disbursements.

          (a) Manager’s Compensation and Reimbursements. From Gross Collections, Manager shall be authorized to retain and pay (1) Manager’s compensation, together with all sales or other taxes (other than income) which Manager is obligated, presently or in the future, to collect and pay to the State or any other governmental authority with respect to the Property or employees at the Property, (2) the amounts reimbursable to Manager under this Agreement, (3) the amount of all real estate taxes and other impositions levied by appropriate authorities with respect to the Property which, if not escrowed with any mortgagee, shall be paid upon specific written direction of Owner before interest begins to accrue thereon; and (4) amounts otherwise due and payable as operating expenses of the Property authorized to be incurred under the terms of this Agreement.

          (b) Debt Service. The provisions of this Section 3.9 regarding disbursements shall include the payment of debt service related to any mortgages of the Property, unless otherwise instructed in writing by Owner.

          (c) Third Parties. All costs, expenses, debts and liabilities owed to third persons that are incurred by Manager pursuant to the terms of this Agreement and in the course of managing, leasing and operating the Property shall be the responsibility of Owner and not Manager. Owner agrees to provide sufficient working capital funds to Manager so that all amounts due and owing may be promptly paid by Manager. Manager is not obligated to advance any funds. If at any time there is not sufficient cash in the account available to Manager pursuant to Section 5.2 with which to promptly pay the bills due and owing, Manager will request that the necessary additional funds be deposited by Owner in an amount sufficient to meet the shortfall. Owner will deposit the additional funds requested by Manager within five days.

          (d) Other Provisions. The provisions of this Section 3.9 regarding reimbursements to Manager shall not limit Manager’s rights under any other provision of this Agreement.

     Section 3.10 Use and Maintenance of Premises. Manager agrees that it will not knowingly permit the use of the Property for any purpose that might void any insurance policy held by Owner or that might render any loss thereunder uncollectible, or that would be in violation of Governmental Requirements, or any covenant or restriction of any lease of the Property. Manager shall use its good faith efforts to secure substantial compliance by the tenants with the terms and conditions of their respective leases. All costs of correcting or complying with, and all fines payable in connection with, all orders or violations affecting the Property placed thereon by any governmental authority or Board of Fire Underwriters or other similar body shall be at the cost and expense of Owner.

     Section 3.11 Annual Business Plan.

          (a) Submission. On or before November 1 of each Fiscal Year during the term of this Agreement, or such earlier date as reasonably requested by Owner, its lenders or investors, Manager shall prepare and submit to Owner for Owner’s approval, an Annual

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Business Plan for the promotion, leasing, operations, repair and maintenance of the Property for the succeeding Fiscal Year during which this Agreement is to remain in effect (the “Annual Business Plan”). The Annual Business Plan shall include a detailed budget of projected income and expenses for the Property for such Fiscal Year (the “Operating Budget”) and a detailed budget of projected capital improvements for the Property for such Fiscal Year (the “Capital Budget”).

          (b) Approval. Manager shall meet with Owner to discuss the proposed Annual Business Plan and Owner shall approve the proposed Annual Business Plan within 20 days of its submission to Owner, or as soon thereafter as commercially practicable. To be effective, any notice which disapproves a proposed Annual Business Plan must contain specific objections in reasonable detail to individual line items. If Owner fails to provide an effective notice disapproving a proposed Annual Business Plan within such 20-day period, the proposed Annual Business Plan shall be deemed to be approved. Owner acknowledges that the Operating Budget is intended only to be a reasonable estimate of the income and expenses of the Property for the ensuing Fiscal Year. Manager shall not be deemed to have made any guarantee, warranty or representation whatsoever in connection with the Operating Budget.

          (c) Revision. Manager may revise the Operating Budget from time to time, as necessary, to reflect any unpredicted significant changes, variables or events or to include significant additional, unanticipated items of revenue and expense. Any such revision shall be submitted to Owner for approval, which approval shall not be unreasonably withheld, delayed or conditioned.

          (d) Implementation. Manager agrees to use diligence and to employ all reasonable efforts to ensure that the actual costs of maintaining and operating the Property shall not exceed the Operating Budget either in total or in any one accounting category. Any expense causing or likely to cause a variance of greater than ten percent (10%) or $25,000, whichever is greater, in any one accounting category for the current month cumulative year-to-date total shall be promptly explained to Owner by Manager in the next operating statement submitted by Manager to Owner.

     Section 3.12 Records, Reporting. Manager shall maintain at the regular business office of Manager or at such other address as Manager shall advise Owner in writing, separate books and journals and orderly files, containing rental records, insurance policies, leases, correspondence, receipts, bills and vouchers, and all other documents and papers pertaining directly to the Property and the operation thereof. All corporate statements, receipts, invoices, checks, leases, contracts, worksheets, financial statements, books and records, and all other instruments and documents relating to or arising from the operation or management of the Property shall be and remain the property of Owner and the Owner shall have the right to inspect such records at any reasonable time upon prior notice; Manager shall have the right to request and maintain copies of all such matters, at Manager’s cost and expense, at all reasonable times during the term of this Agreement, and for a reasonable time thereafter not to exceed three years. All on-site records, including leases, rent rolls, and other related documents shall remain at the respective Property for which such records are maintained as the property of Owner.

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     Section 3.13 Financial Reports.

          (a) Monthly Reports. On or before the tenth day of each month during the term of this Agreement, Manager shall deliver or cause to be delivered to Owner’s Representative a statement of cash flow for the Property (on a cash and not an accrual basis) for the preceding calendar month. All notices from any mortgagee claiming any default in any mortgage on the Property, and any other notice from any mortgagee not of a routine nature, shall be promptly delivered by Manager to Owner’s Representative.

          (b) Annual Reports. Within 45 days after the end of each Fiscal Year, Manager shall deliver to Owner’s Representative a statement of cash flow showing the results of operations for the Fiscal Year or portion thereof during which the provisions of this Agreement were in effect.

          (c) Employee Files. Manager shall execute and file punctually when due all forms, reports and returns required by law relating to the employment of personnel.

     Section 3.14 Compliance with Governmental Requirements. Manager shall comply with all laws, ordinances and regulations relating to the management, leasing and occupancy of the Property. Owner acknowledges that Manager does not hold itself out to be an expert or consultant with respect to, or represent that, the Property currently complies with applicable ordinances, regulations, rules, statutes, or laws of governmental entities having jurisdiction over the Properties or the requirements of the Board of Fire Underwriters or other similar bodies (collectively, “Governmental Requirements”). Manager shall take such action as may be reasonably necessary to comply with any Governmental Requirements applicable to Manager, including the collection and payment of all sales and other taxes (other than income taxes) which may be assessed or charged by the State or any governmental entities in connection with Manager’s compensation. If Manager discovers that the Property does not comply with any Governmental Requirements, Manager shall take such action as may be reasonably necessary to bring the Property into compliance with such Governmental Requirements, subject to the limitation contained in Section 3.5 of this Agreement regarding the making of alterations and repairs. Manager, however, shall not take any such action as long as Owner is contesting or has affirmed its intention to contest and promptly institute proceedings contesting any such order or requirement. If, however, failure to comply promptly with any such order or requirement would or might expose Manager to civil or criminal liability, Manager shall have the right, but not the obligation, to cause the same to be complied with and Owner agrees to indemnify and hold Manager harmless for taking such actions and to promptly reimburse Manager for expenses incurred thereby. Manager shall promptly, and in no event later than 72 hours from the time of receipt, notify Owner’s Representative in writing of all such orders or notices. Manager shall not be liable for any effort or judgment or for any mistake of fact or of law, or for anything that it may do or refrain from doing, except in cases of willful misconduct or gross negligence of Manager.

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ARTICLE 4
MANAGER’S COMPENSATION, TERM

     Section 4.1 Fees Paid to Manager. Commencing on the date hereof, Owner shall pay to Manager a fee (the “Management Fee”), payable monthly in arrears, in an amount equal to Three and One-half Percent (3.5%) of Gross Collections for such month. The Management Fee shall not be subject to off-sets and charges unless agreed upon by the parties.

     Section 4.2 Term. This Agreement shall commence on the Effective Date, and shall thereafter continue for a period of one (1) year from the Effective Date, unless otherwise terminated as provided herein. Thereafter, if neither party gives written notice to the other at least 30 days prior to the expiration date hereof that this Agreement is to terminate, then this Agreement shall be automatically renewed on a month-to-month basis.

     Section 4.3 Termination Rights. Notwithstanding anything that may be contained herein to the contrary, with or without grounds or cause therefor, Owner may terminate this Agreement at any time by giving Manager thirty (30) days written notice thereof; provided, however, upon a determination that this Agreement may be terminated for cause due to the gross negligence, willful misconduct or bad acts of Manager or any of its employees, Owner may immediately terminate with contract by giving Manager five (5) days written notice thereof. Any notice given pursuant to this Article 4, shall be sent by certified mail.

     Section 4.4 Duties on Termination. Upon any termination of this Agreement as contemplated in this Section 4.4, Manager shall be entitled to receive all compensation and reimbursements, if any, due to Manager through the date of termination. If Owner or Manager shall materially breach its obligations hereunder, and such breach remains uncured for a period of 10 days after written notification of such breach, the party not in breach hereunder may terminate this Agreement by giving written notice to the other. Within 30 days after any termination, Manager shall deliver to Owner’s Representative, the report required by Section 3.13(a) for any period not covered by such a report at time of termination, and within 30 days after any such termination, Manager shall deliver to Owner’s Representative, as required by Section 3.13(b), the statement of cash flow for the Fiscal Year or portion thereof ending on the date of termination. In addition, upon termination of this Agreement for any reason, Manager will submit to Owner within 30 days after termination any reports required hereunder, all of the cash and bank accounts of the Property, including, without limitation, the Security Deposit Account, investments and records. Manager will, within 30 days after termination, turn over to Owner all copies of all books and records kept for the Property. If Manager desires to retain records of the Property, Manager must reproduce them at its own expense.

ARTICLE 5
PROCEDURES FOR HANDLING RECEIPTS AND OPERATING CAPITAL

     Section 5.1 Security Deposits. Manager shall collect, deposit, hold, disburse and pay security deposits as required by applicable State law and all other applicable laws, and in accordance with the terms of each tenant’s lease. The amount of each security deposit will be specified in the tenant’s lease. Security deposits will be deposited at the direction of Owner into a separate interest-bearing account (the “Security Deposit Account”) at a Depository selected

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by Owner. The Security Deposit Account shall be established in the name of the Owner and held separate from all other of Manager’s funds and accounts, unless the Owner informs Manager, in writing that it intends to hold the Security Deposit Account. If such account is held by Manager, only representatives of Manager will be signatories to this account. To the extent possible, the Security Deposit Account shall be fully insured by the Federal Deposit Insurance Corporation (FDIC). Owner agrees to indemnify and hold harmless Manager, and Manager’s representatives, officers, directors and employees for any loss or liability with respect to any use by Owner of the tenant security deposits that is inconsistent with the terms of tenant leases and applicable laws.

     Section 5.2 Separation of Owner’s Monies. Manager shall deliver all collected rents, charges and other amounts received in connection with the management and operation of the Property (except for tenants’ security deposits, which will be handled as specified in this Agreement) to a Depository designated by Owner.

     Section 5.3 Depository Accounts. Except to the extent that Manager has not complied with its obligations under Section 2.3(c), Owner and Manager agree that Manager shall have no liability for loss of funds of Owner contained in the bank accounts for the Property maintained by Owner or Manager pursuant to this Agreement due to insolvency of the bank or financial institution in which its accounts are kept, whether or not the amounts in such accounts exceed the maximum amount of federal or other deposit insurance applicable with respect to the financial institution in question.

     Section 5.4 Working Capital. In addition to the funds derived from the operation of the Property, Owner shall furnish and maintain in the operating accounts of the Property such other funds as may be necessary to discharge financial commitments required to efficiently operate the Property and to meet all payrolls and satisfy, before delinquency, and to discharge all accounts payable. Manager shall have no responsibility or obligation with respect to the furnishing of any such funds. Nevertheless, Manager shall have the right, but not the obligation, to advance funds or contribute property on behalf of Owner to satisfy obligations of Owner in connection with this Agreement and the Property. Manager shall keep appropriate records to document all reimbursable expenses paid by Manager, which records shall be made available for inspection by Owner or its agents on request. Owner agrees to reimburse Manager upon demand for money paid or property contributed in connection with the Property and this Agreement.

     Section 5.5 Authorized Signatures. Any persons from time to time designated by Manager shall be authorized signatories on all bank accounts established by Manager pursuant to this Agreement and shall have authority to make disbursements from such accounts. Funds may be withdrawn from all bank accounts established by Manager, in accordance with this Article 5, only upon the signature of an individual who has been granted that authority by Manager and funds may not be withdrawn from such accounts by Owner unless Manager is in default hereunder.

ARTICLE 6
MISCELLANEOUS

     Section 6.1 Assignment. Upon 30 days written notification, Owner may assign its rights and obligations to any successor in title to the Property and upon such assignment shall be

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relieved of all liability accruing after the effective date of such assignment. This Agreement may not be assigned or delegated by Manager without the prior written consent of Owner, which Owner may withhold in its sole discretion. Manager shall assign or provide a security interest in this Agreement at the request of Owner, its lenders or investors. Any unauthorized assignment shall be null and void ab initio, and shall not in any event release Manager from any liabilities hereunder.

     Section 6.2 Notices. All notices required or permitted by this Agreement shall be in writing and shall be sent by registered or certified mail, addressed in the case of Owner to SIR Park Place, LLC, 18100 Von Karman Avenue, Suite 500, Irvine, CA 92612, Attn: R. Kyle Winning; and in the case of Manager to Steadfast Management Company, Inc., 4343 Von Karman Avenue, Suite 300, Newport Beach, CA 92660, Attention: Ana Marie del Rio, or to such other address as shall, from time to time, have been designated by written notice by either party given to the other party as herein provided.

     Section 6.3 Entire Agreement. This Agreement shall constitute the entire agreement between the parties hereto and no modification thereof shall be effective unless in writing executed by the parties hereto.

     Section 6.4 No Partnership. Nothing contained in this Agreement shall constitute or be construed to be or create a partnership or joint venture between Owner, its successors or assigns, on the one part, and Manager, its successors and assigns, on the other part.

     Section 6.5 No Third Party Beneficiary. Neither this Agreement nor any part hereof nor any service relationship shall inure to the benefit of any third party, to any trustee in bankruptcy, to any assignee for the benefit of creditors, to any receiver by reason of insolvency, to any other fiduciary or officer representing a bankrupt or insolvent estate of either party, or to the creditors or claimants of such an estate. Without limiting the generality of the foregoing sentence, it is specifically understood and agreed that such insolvency or bankruptcy of either party hereto shall, at the option of the other party, void all rights of such insolvent or bankrupt party hereunder (or so many of such rights as the other party shall elect to void).

     Section 6.6 Severability. If any one or more of the provisions of this Agreement, or the applicability of any such provision to a specific situation, shall be held invalid or unenforceable, such provision should be modified to the minimum extent necessary to make it or its application valid and enforceable, and the validity and enforceability of all other provisions of this Agreement and all other applications of such provisions shall not be affected thereby.

     Section 6.7 Captions, Plural Terms. Unless the context clearly requires otherwise, the singular number herein shall include the plural, the plural number shall include the singular and any gender shall include all genders. Titles and captions herein shall not affect the construction of this Agreement.

     Section 6.8 Attorneys’ Fees. Should either party employ an attorney to enforce any of the provisions of this Agreement, or to recover damages for breach of this Agreement, the non-prevailing party in any action agrees to pay to the prevailing party all reasonable costs,

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damages and expenses, including reasonable attorneys’ fees, expended or incurred by the prevailing party in connection therewith.

     Section 6.9 Signs. Manager shall have the right to place signs on the Property in accordance with applicable Governmental Requirements stating that Manager is the manager and leasing agent for the Property.

     Section 6.10 Survival of Indemnities. The indemnification obligations of the parties to this Agreement shall survive the termination of this Agreement to the extent of any claim or cause of action based on an event occurring prior to the date of termination.

     Section 6.11 Governing Law. This Agreement shall be construed under and in accordance with the laws of the State and is fully performable with respect to the Property in the county in which the Property is located.

     Section 6.12 Competitive Properties. Manager may, individually or with others, engage or possess an interest in any other project or venture of every nature and description, including but not limited to, the ownership, financing, leasing, operation, management, brokerage and sale of real estate projects including apartment projects other than the Property, whether or not such other venture or projects are competitive with the Property and Owner shall not have any claim as to such project or venture or to the income or profits derived therefrom.

     Section 6.13 Set Off. Without prejudice to Manager’s right to terminate this Agreement in accordance with the terms of this Agreement, Manager may at any time and without notice to Owner, set off or transfer any sums held by Manager for or on behalf of Owner in the accounts (other than the Security Deposit Account) maintained pursuant to this Agreement in or towards satisfaction of any of Owner’s liabilities to Manager in respect of any sums due to Manager under this Agreement.

     Section 6.14 Notice of Default. Manager shall not be deemed in default under this Agreement, and Owner’s right to terminate Manager as a result of such default shall not accrue, until Owner has delivered written notice of default to Manager and Manager has failed to cure same within 30 days from the date of receipt of such notice.

     Section 6.15 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

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This Property Management Agreement is hereby executed by duly authorized representatives of the parties hereto as of the Effective Date.

OWNER:	SIR PARK PLACE, LLC,
	an Illinois limited liability company
	By:		Steadfast Income Advisor, LLC, its Manager
			By:  /s/  James Kasim
			Name:  James Kasim
			Title:   Chief Financial Officer
MANAGER:	STEADFAST MANAGEMENT CO., INC.
	By:  /s/  Christopher M. Hilbert
		Name:  Christopher M. Hilbert
		Title:  Executive Vice President

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EXHIBIT A

THE PROPERTY

Legal Description: 615 Park Street, Des Moines, IA 50309

The real property situated in the City of Des Moines, County of Polk, State of Iowa, and described as follows:

Units 403 through 409, inclusive, Units 411, 412 and 422, Units 501 and 502, Units 504 through 508, inclusive, Units 510 through 512, inclusive, Units 601 through 612, inclusive, Units 701 through 712, inclusive, Units 801 through 812, inclusive, Units 901 through 912, inclusive, Units 1001, 1002, 1004 and 1005, Units 1007 through 1012, inclusive, Units 1101 through 1112, inclusive, Units 1201 through 1212, inclusive, Units 1301 and 1302, Units 1304 through 1312 inclusive, Units 1401 and 1402, Units 1404 through 1412, inclusive, Units 1501 through 1503, inclusive, Unites 1506 through 1512, inclusive, Units 1601 through 1616, inclusive, Garage Units P1 though P20, inclusive, Garage Units P21a and P21b, Garage Units P22 and P23, Garage Units P25 through P51, inclusive, Garage Units P53 through P58, inclusive, Garage Units P60a and P60b, Garage Units P62 through P68, inclusive, Garage Units P69a and 69b, Garage Units P70 through P90, Garage Units P92 through P102, inclusive, together with percentage interest in the Common Elements as provided in the Declaration of Submission to the Horizontal Property Regime referred to below, in PARK PLACE CONDO LLC, a Condominium, City of Des Moines, and County of Polk, Iowa, and located upon Lots 6 and 7 in Block “R” in Grimmel’s Addition to the Town of Fort Des Moines, in accordance with and subject to the Declaration of Submission to Horizontal Property Regime, recorded on December 18, 2006 in Book 11997 Page 522 in the records of the Polk County Iowa recorder as amended.

EX-99.1

Exhibit 99.1

18100 Von Karman Avenue
Suite 500
Irvine, CA 92612
949.852.0700

NEWS RELEASE
Contact:	Jennifer Schmidt
Phone:	949.333.1721
Email:	jschmidt@steadfastcmg.com

STEADFAST INCOME REIT ACQUIRES
PARK PLACE APARTMENTS IN DES MOINES, IOWA

IRVINE, Calif., Dec. 27, 2010 — Steadfast Income REIT, Inc. announced today the acquisition of 147 units in Park Place Apartments, a high-rise building located in downtown Des Moines, Iowa. Des Moines recently ranked first on Forbes Magazine’s 2010 list of “Best Places for Business and Careers,” and third on its 2009 “America’s Most Livable City” list.

“Many of the factors that Forbes highlighted in their review of Des Moines — namely its low unemployment rate, favorable economic outlook, well-educated workforce and its dominant positioning as a headquarters city for many major corporations — were key components in our decision to acquire Park Place,” said Rodney F. Emery, CEO and president of Steadfast Income REIT.

Park Place was built in 1986 and is located at 615 Park Street in the city’s central business district. The property’s close proximity to the Des Moines skywalk system allows a direct link to most of the area’s hotel, retail, office and entertainment venues.

The 16-story brick building is currently 95 percent leased and consists of studio, one- and two-bedroom apartments ranging from approximately 425 square feet to approximately 760 square feet. Eleven of the building’s 158 units are privately owned, and were not included in the purchase. Community amenities include a 6,000-square-foot rooftop terrace, fitness center, underground parking facilities, community room with Wi-Fi and library, secured access entrance and laundry facilities on each floor.

“We feel that the favorable acquisition terms negotiated by the REIT coupled with the property’s many attributes position it to produce immediate income,” said Emery. “Additionally, Steadfast Management

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2-2-2 Steadfast Income REIT Acquires Park Place Apartments

Company will manage the property and will seek opportunities to strategically add value as part of the overall asset strategy.”

Steadfast Income REIT financed the acquisition with cash proceeds received through its public offering and financing was arranged by Jeffrey Harder at Iowa-based Ames Community Bank.

About Steadfast Income REIT

Steadfast Income REIT intends to qualify as a real estate investment trust and use the proceeds of its $1.65 billion ongoing public offering to acquire and operate a diverse portfolio of real estate investments focused primarily on the multifamily sector, including stabilized, income-producing and value-added properties.

Steadfast Income REIT is sponsored by Steadfast REIT Investments LLC, an affiliate of Steadfast Companies, an Orange County, Calif.-based group of affiliated real estate investment and operating companies that acquire, develop and manage real estate in the U.S. and Mexico.

This release contains certain forward-looking statements. Because such statements include risks, uncertainties and contingencies, actual results may differ materially from those expressed or implied by such forward-looking statements and you should not place undue reliance on any such statements. A number of important factors could cause actual results to differ materially from the forward-looking statements contained in this release. Such factors include those described in the Risk Factors sections of the offering documents for the offering of equity of Steadfast Income REIT, Inc. Forward-looking statements in this document speak only as of the date on which such statements were made, and we undertake no obligation to update any such statements that may become untrue because of subsequent events. We claim the safe harbor protection for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

THIS PRESS RELEASE SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY, NOR SHALL THERE BE ANY OFFER OR SALE OF SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION, OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. AN OFFER OF SECURITIES IS MADE ONLY BY A PROSPECTUS. FOR A COPY OF THE PROSPECTUS, PLEASE CONTACT YOUR INVESTMENT PROFESSIONAL OR STEADFAST CAPITAL MARKETS GROUP AT 877.525.SCMG (7264).

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