Behringer Letter Says Monogram Not Addressing Concerns Over Legitimacy of Executive Committee

Behringer today issued an official letter of response, attached to this release, that rebukes actions taken by Monogram Residential Trust

to suppress the voices of two Behringer executives who presently serve on Monogram's Board of Directors. While Behringer would not normally engage in this type of public dispute, Behringer is responding to the public filing and statements made by Monogram on Wednesday, March 23, 2016. Attached Letter: March 28, 2016 Stephen D. Poss, Esq Goodwin Procter LLP Exchange Place 53 State Street Boston, MA 02109 Re: Improper Formation of "Executive Committee" and Strategic Direction of Monogram Should Advance the Best Interest of Stockholders Dear Mr. Poss, As you know, I represent Behringer. I write in response to your letter of March 23, 2016, on behalf of Mr. Robert Aisner and Mr. Michael Cohen, in their capacity as Behringer's nominees to the board of directors of Monogram. At the outset it must strongly be observed that, should there be any doubt, Messrs. Aisner and Cohen are expressing their views and (at times) disagreements on certain key decisions with the objective of advancing the best interests of the stockholders of Monogram. Messrs. Aisner and Cohen have deep and relevant expertise and industry experience. Their informed and important views should be considered by the full board of directors and are valuable to ensuring the board is acting on a fully informed basis and in the best interest of stockholders. We had expected that my well-intentioned letter of March 11 would open up a meaningful dialogue with the other directors on the board of Monogram about the serious concerns stated in that letter and ultimately how to advance the best interests of Monogram and its stockholders, including whether strategic alternatives should be explored. As you are aware, respected third parties have echoed the importance of undertaking such a strategic review. Instead, we received your letter, which does not seriously address our concerns with respect to the legitimacy of the executive committee, the effective removal of Messrs. Aisner and Cohen from the board of directors or other important matters. The conflicts of interest described and alleged in your letter are mere pretext used to silence the views of Messrs. Aisner and Cohen. In essence, preferred stock such as held by Behringer is designed to present a "win-win" situation for shareholders and sponsors. As you observe in your letter, the preferred stock has no value unless the stockholders of Monogram receive a return of their capital plus such return of 7 percent. This preferred stock creates alignment (albeit with a finite life) between the interests of Behringer and the interests of stockholders, in the same way as does incentive compensation and certain equity incentives for the executives. And as you know, the independent directors of Monogram unanimously approved the director nomination right of Behringer, the issuance of this preferred stock to Behringer, and the fee arrangement that Monogram is now trying to evade. In addition, the fees owed to Behringer, while important to Behringer, are immaterial to Monogram, a company with a market capitalization of over $1.5 billion and assets of over $3 billion. These fees are the subject of unfortunate litigation only because Monogram has refused to honor its contractual obligations. The fact that Monogram is highlighting this immaterial dispute reinforces the fact that Monogram is trying to divert attention away from matters that are more important for the stockholders; namely, that Monogram has attempted to silence two directors who are aligned with stockholders and that strategic alternatives are not being adequately considered. Importantly, Mr. Cohen denies the statements that are attributed to him in your letter. Such are either incorrect or mischaracterized. Mr. Cohen acknowledges that he met with Mr. Alfieri on several occasions to discuss the potential buyout of the series A preferred stock by Monogram, several times at the request of Mr. Alfieri. While there were separate settlement discussions between Mr. Aisner and Mr. Alfieri as related to fees that Monogram has a clear contractual obligation to pay to Behringer, these discussions were not linked by Mr. Cohen to his discussions on the series A preferred stock nor did he threaten litigation over such fees to pressure Monogram to repurchase the preferred stock held by Behringer. In fact, in response to questioning by Mr. Alfieri, and to advance the settlement discussions as related to the fee dispute, Mr. Cohen told Mr. Alfieri that he was not responsible for negotiating such matter on behalf of Behringer, and that Mr. Alfieri needed to discuss settling the fee dispute with Mr. Aisner, which separate discussions did in fact occur. Behringer believes its entitlement to these fees will ultimately be borne out in the pending litigation. As you know, Mr. Cohen was appointed to the board of directors of Monogram (as the nominee of Behringer) as of March 1, 2016. In connection with this appointment, none of the directors on the board of directors, including Mr. Alfieri, raised with Mr. Cohen or Behringer (or, to our knowledge, for the record) any concerns about Mr. Cohen serving as a director of Monogram, including as a result of these alleged statements (which Mr. Cohen denies as indicated above). Again, we believe the formation of the executive committee was intended to effectively remove Mr. Aisner, and now Mr. Cohen, from meaningful participation on the board of directors and prevent them from exercising their right to participate in deliberations of the board, and constitutes (among other things) a violation of Maryland law, Monogram's organizational documents and the contractual rights of Behringer. To be clear, Messrs. Aisner and Cohen have not breached any policy of Monogram and have always conducted themselves in an appropriate manner. Messrs. Aisner and Cohen have and reserve the right to speak to shareholders and other interested parties, especially when those directors believe such action to be in the best interests of Monogram and its stockholders. Such communications are intended to advance the objective of the board of directors acting on a fully informed basis and consistent with their duties. As previously indicated, any such discussions and communications will not occur in the name of, or on behalf of, Monogram. In addition, those discussions will not involve the provision of any confidential information or non-public information to third parties by Messrs. Aisner or Cohen, consistent with the policies of Monogram. Behringer reserves all rights, including, pursuing all appropriate and necessary judicial relief. Please contact me if you have any questions or want to discuss. Sincerely, /s/ Donald E. Batterson Donald E. Batterson