MEMBERSHIP INTEREST PURCHASE AGREEMENT SALE OF BERRY HILL INTEREST FROM BLUEROCK SPECIAL OPPORTUNITY + INCOME FUND III, LLC TO BEMT BERRY HILL, LLC CONTENTS

MEMBERSHIP INTEREST PURCHASE AGREEMENT

SALE OF XXXXX XXXX INTEREST

FROM

BLUEROCK SPECIAL OPPORTUNITY + INCOME FUND III, LLC

TO

BEMT XXXXX HILL, LLC

CONTENTS

Clause Page

Article 1.	PURCHASE OF INTEREST; CONSIDERATION; DEFINITIONS		1
1.1	Purchase of Xxxxx Xxxx Interest; Consideration		1
1.2	Definitions		1
1.3	Descriptive Headings; Word Meaning		2
Article 2.	CLOSING		2
2.1	Seller Deliveries		2
2.2	Buyer Deliveries		2
2.3	Closing Statement		2
Article 3.	PRORATIONS; COSTS		2
3.1	Prorations		2
3.2	Post-Closing Corrections		2
3.3	Costs; Transfer Taxes		3
3.4	Sales Commissions		3
3.5	Excluded Obligations and Assets		3
Article 4.	REPRESENTATIONS AND WARRANTIES		3
4.1	Seller’s Representations and Warranties as to Seller		3
4.2	Seller’s Representations and Warranties as to the Xxxxx Hill Interest		4
4.3	Buyer’s Representations and Warranties		4
4.4	Limitations		6
4.5	Survival of Representations and Warranties		6
Article 5.	INDEMNIFICATION AND LIMITATION ON LIABILITY		6
5.1	Indemnification between Seller and Buyer		6
5.2	Limitation on Seller’s Liability		6
5.3	Survival		6
Article 6.	MISCELLANEOUS		7
6.1	Parties Bound		7
6.2	Headings; Entirety; Amendments		7
6.3	Invalidity and Waiver		7
6.4	Governing Law; Calculation of Time Periods; Time		7
6.5	No Third Party Beneficiary		7
6.6	Confidentiality		7
6.7	Enforcement Expenses		7
6.8	Notices		8
6.9	Construction		8
6.10	Execution in Counterparts		8
6.11	Further Assurances		8
6.12	Waiver of Jury Trial; Forum		8
6.13	Mutual Execution		8
6.14	Cooperation		8

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MEMBERSHIP INTEREST PURCHASE AGREEMENT

SCHEDULE OF EXHIBITS AND APPENDICES

Exhibit A	-	Organizational Chart
Appendix 1.2	-	Defined Terms
Appendix 2.1(a)	-	Form of Assignment of Interest
Appendix 2.1(c)	-	Form of Venture Agreement Amendment

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MEMBERSHIP INTEREST PURCHASE AGREEMENT

This Membership Interest Purchase Agreement (this “Agreement”) is made as of the 17th day of December, 2012 (the “Effective Date”) by and among BLUEROCK SPECIAL OPPORTUNITY + INCOME FUND III, LLC, a Delaware limited liability company (“Seller”), and BEMT XXXXX XXXX, LLC, a Delaware limited liability company (“Buyer”).

RECITALS

A. Seller is the owner and holder of a 29% limited liability company interest in BR Xxxxx Hill Managing Member, LLC, a Delaware limited liability company (“BR Xxxxx Xxxx Member”).

B. Buyer is the manager of, and is the owner and holder of 71% limited liability company interest in, BR Xxxxx Hill Member.

C. BR Xxxxx Xxxx Member is a co-manager of, and is the owner and holder of an 82.5% limited liability company interest in, BR Stonehenge 23Hundred JV, LLC, a Delaware limited liability company (“Xxxxx Xxxx Venture”), which is the sole member of 23Hundred, LLC, a Delaware limited liability company (the “Subsidiary”), which is the fee simple owner and holder of the Xxxxx Hill Property (as defined in Appendix 1.2).

D. BR Xxxxx Xxxx Member is an indirect owner of the Xxxxx Hill Property, as shown in the organizational chart attached to this Agreement as Exhibit A (the “Organizational Chart”).

E. Seller desires to sell, and Buyer desires to purchase from Seller, all of Seller’s right, title and interest in a 6.253% limited liability company interest in BR Xxxxx Xxxx Member (the “Xxxxx Hill Interest”), which equates to an additional 5.158% indirect interest in the Xxxxx Xxxx Property.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer agree as follows:

ARTICLE 1. PURCHASE OF INTEREST; CONSIDERATION; DEFINITIONS

1.1 Purchase of Xxxxx Hill Interest; Consideration. In accordance with the Recitals set forth above, which Recitals are incorporated into this Agreement and made a part thereof, Seller agrees to sell and convey, and Buyer agrees to purchase, the Xxxxx Xxxx Interest on the terms and conditions set forth herein. As consideration for Seller’s agreement to sell the Xxxxx Hill Interest to Buyer, Buyer has committed to fund a $369,034 capital contribution to BR Xxxxx Xxxx Member for the benefit of Seller (the “Consideration”). Buyer agrees to fund the Consideration at such times and in such increments as shall be necessary to satisfy the current and future capital contribution obligations of Seller to BR Xxxxx Hill Member, pursuant to the terms of the Venture Agreement, as amended by the Venture Agreement Amendment (as defined below), until Buyer has contributed an aggregate amount equal to the Consideration to BR Xxxxx Xxxx Member on behalf of Seller. To the extent that any obligation of Buyer to fund the Consideration remains at the time that Seller no longer holds an interest in BR Xxxxx Hill Member, then the parties shall perform a true-up reconciliation of the Consideration payable to Seller (the “Reconciliation”) within sixty (60) days of the date Seller ceases to hold an interest, with any payment to be made to Seller made in cash within thirty (30) days following the finalization of the Reconciliation. Notwithstanding the foregoing or any provision to the contrary contained herein or in the Venture Agreement, the payment of the Consideration as contemplated in this Section 1.1 shall not be subject to or invoke the provisions of Section 5.2(b) of the Venture Agreement.

1.2 Definitions. Certain terms, capitalized but not defined in the body of this Agreement shall have the meanings ascribed to them on Appendix 1.2 attached hereto.

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1.3 Descriptive Headings; Word Meaning. The descriptive headings of the paragraphs of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any provisions of this Agreement. Words such as “herein,” “hereinafter,” “hereof” and “hereunder” when used in reference to this Agreement, refer to this Agreement as a whole and not merely to a subdivision in which such words appear, unless the context otherwise requires. The singular shall include the plural and the masculine gender shall include the feminine and neuter, and vice versa, unless the context otherwise requires. The word “including” shall not be restrictive and shall be interpreted as if followed by the words “without limitation.”

ARTICLE 2. CLOSING

The transaction described herein shall be closed upon (i) the consummation of the purchase and sale of the Xxxxx Xxxx Interest as contemplated in this Agreement, and (ii) the execution and delivery of the documents set forth in this Article 2.

2.1 Seller Deliveries. Seller shall deliver or cause to be delivered to Buyer the following, each such document being duly executed and, where appropriate, in recordable form and notarized:

(a) Assignment of Interest. An assignment of the Xxxxx Hill Interest, in the form attached hereto as Appendix 2.1(a), executed by Seller (the “Assignment of Interest”);

(b) Authority. Evidence of the existence, organization and authority of Seller and of the authority of the Persons executing documents on behalf of Seller reasonably satisfactory to Buyer;

(c)First Amendment to Venture Agreement. An amendment to the Venture Agreement, in the form attached hereto as Appendix 2.1(c), duly executed by Seller and reflecting the consummation of the purchase and sale of the Xxxxx Xxxx Interest as contemplated herein (the “Venture Agreement Amendment”);

(d) Other Deliveries. Such other documents, certificates and instruments reasonably necessary in order to effectuate the transactions described herein, including without limitation, transfer tax declarations, broker lien waivers, and any other Closing deliveries required to be made by or on behalf of Seller.

2.2 Buyer Deliveries. Buyer shall deliver or cause to be delivered to Seller the following, each such document being duly executed and, where appropriate, in recordable form and notarized:

(a) Authority. Evidence of the existence, organization and authority of Buyer and of the authority of the Persons executing documents on behalf of Buyer reasonably satisfactory to Seller;

(b) Venture Agreement Amendment. The Venture Agreement Amendment, duly executed by Buyer; and

(c) Other Deliveries. Such other documents, certificates and instruments reasonably necessary in order to effectuate the transactions described herein, including without limitation, transfer tax declarations, broker lien waivers, and any other Closing deliveries required to be made by or on behalf of Buyer.

2.3 Closing Statement. Seller and Buyer shall execute a closing statement consistent with this Agreement.

ARTICLE 3. PRORATIONS; COSTS

3.1 Prorations. Buyer and Seller agree to use customary commercially reasonable practices to determine all prorations and adjustments to be made between Buyer and Seller at Closing.

3.2 Post-Closing Corrections. Either party shall be entitled to a post-Closing adjustment for any incorrect proration or adjustment, provided such adjustment is claimed by such party within twelve (12) months after Closing. The provisions of this Section 3.2 shall survive the Closing.

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3.3 Costs; Transfer Taxes. Buyer shall pay any Transfer Taxes due and payable with respect to the conveyance of the Xxxxx Hill Interest. Seller shall pay the cost of removing any Encumbrances on the Xxxxx Xxxx Interest. Except as provided in Section 5.1 and Section 6.7 of this Agreement, or in any document or instrument executed pursuant to this Agreement, each party shall be responsible for their own attorneys’ and other professional fees. Seller and Buyer shall execute any required city, county and state transfer tax or other declarations, if applicable.

3.4 Sales Commissions. Seller and Buyer represent and warrant each to the other that they have not dealt with any real estate broker or salesperson in connection with this transaction. In the event of any claim for broker’s or finder’s fees or commissions in connection with the negotiation, execution or consummation of this Agreement or the transaction contemplated hereby, each party shall indemnify, defend and hold harmless the other party from and against any such claim based upon any actual or alleged statement, representation or agreement of the indemnifying party. This provision shall survive the Closing and any termination of this Agreement.

3.5 Excluded Obligations and Assets.

(a) Seller Obligations. Neither Buyer nor any of its direct or indirect owners is assuming any liabilities related to the Xxxxx Hill Interest.

(b) Survival. The provisions of this Section 3.5 shall survive Closing indefinitely and shall not be subject to the limitations set forth in Section 4.5 or Article 5.

ARTICLE 4. REPRESENTATIONS AND WARRANTIES

4.1 Seller’s Representations and Warranties as to Seller. As a material inducement to Buyer to execute this Agreement and consummate the Closing, Seller represents and warrants to Buyer that:

(a) Seller has been duly formed or organized as a limited liability company, is validly existing and is in good standing in the State of Delaware, and is authorized to exercise all its powers, rights and privileges.

(b) Seller has the power and authority, under its Charter Documents, to own and operate its assets, to carry on its business as now conducted, and to enter into and perform its obligations under this Agreement.

(c) All manager, member, or other action on the part of Seller and the BR Xxxxx Xxxx Member necessary for Seller’s authorization, execution and delivery of this Agreement, and the performance of all obligations of Seller hereunder and the completion of the Closing pursuant hereto has been taken or will be taken prior to the Closing. This Agreement constitutes a legally binding and valid obligation of Seller, enforceable against Seller in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity).

(d) The execution and delivery of this Agreement by Seller and the performance by Seller of its obligations pursuant hereto will not result in any violation of, be in conflict with, or constitute a default under, with or without the passage of time or the giving of notice: (x) any provision of Seller’s Charter Documents as such documents exist immediately prior to the Closing; (y) any provision of any judgment, decree or order to which Seller is a party or by which its properties or assets are bound; or (z) any Laws applicable to Seller or its properties or assets.

(e) The execution and delivery of this Agreement by Seller and the performance by Seller of its obligations pursuant hereto will not result in any violation of, be in conflict with, or constitute a default under, with or without the passage of time or the giving of notice any material contract or agreement to which Seller is a party.

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(f) The execution, delivery and performance by Seller of this Agreement does not require the consent, approval, notice, clearance, waiver, order or authorization of any Person or Governmental Authority that has not been obtained or given.

(g) There is no action, suit, proceeding or investigation pending or, to the knowledge of Seller, threatened in writing against Seller that challenges the validity of this Agreement or the right of Seller to enter into this Agreement, or that might result, either individually or in the aggregate, in Seller’s inability to perform its obligations under this Agreement. There is no material judgment, decree or order of any court, arbitrator, tribunal or governmental or similar authority in effect against Seller, nor is Seller in material default with respect to any order or any court, arbitrator, tribunal or governmental or similar authority binding upon Seller, by which it or its respective properties or assets are bound, which would prevent Seller from performing its obligations under this Agreement.

(h) Seller is not and is not acting on behalf of (i) an “employee benefit plan” within the meaning of Section 3(3) of ERISA), (ii) a “plan” within the meaning of Section 4975 of the Code or (iii) an entity deemed to hold “plan assets” within the meaning of 29 C.F.R. §2510.3-101 of any such employee benefit plan or plans.

(i) Seller is not acting, directly or indirectly for, or on behalf of, any Person, group, entity or nation named by any Executive Order (including the September 24, 2001, Executive Order Blocking Properties and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism) or the United States Treasury Department as a terrorist, “Specially Designated National and Blocked Person,” or other banned or blocked Person, group, entity, or nation pursuant to any Law that is enforced or administered by the Office of Foreign Assets Control, and is not engaging in the transactions described herein, directly or indirectly, on behalf of, or instigating or facilitating the transactions described herein, directly or indirectly, on behalf of, any such Person, group, entity or nation.

(j) Seller is not insolvent and will not become insolvent by executing or performing its obligations under this Agreement or the documents to be executed in connection herewith.

4.2 Seller’s Representations and Warranties as to the Xxxxx Hill Interest. As a material inducement to Buyer to execute this Agreement and consummate the Closing, Seller represents and warrants to Buyer with respect to the Xxxxx Xxxx Interest, BR Xxxxx Hill Member, Xxxxx Xxxx Venture and the Subsidiary that:

(a) Seller is the owner and holder of 29% of the limited liability company interests in BR Xxxxx Hill Member. The Xxxxx Xxxx Interest is free and clear of any Encumbrances, subject only to restrictions on transfer imposed under applicable U.S. federal and state securities Laws, the Venture Agreement and the Loan Documents. The Xxxxx Hill Interest has been duly and validly issued and, except as contemplated by this Agreement or the Venture Agreement, there exists no agreement, arrangement or obligation (actual or contingent) to issue, transfer, redeem, repay or repurchase the Xxxxx Xxxx Interest or any portion thereof.

(b) Other than as provided in the limited liability company agreement of Xxxxx Hill Venture or the Subsidiary or the Venture Agreement, there are no options, warrants, stock appreciation rights, calls, pre-emptive rights, subscriptions, contribution rights, convertible securities, or other rights or other agreements or commitments of any character whatsoever which are an obligation of Seller to issue, transfer or sell any securities exercisable for, or otherwise evidencing a right to acquire, any interests of any kind in any of BR Xxxxx Xxxx Member, Xxxxx Hill Venture or the Subsidiary (except the rights of Buyer under this Agreement).

(c) The Organizational Chart is correct and correctly shows Xxxxx Xxxx Venture and the Subsidiary and the percentage ownership interest of BR Xxxxx Hill Member in Xxxxx Xxxx Venture, and indirectly in the Subsidiary, immediately prior to the Closing hereunder.

4.3 Buyer’s Representations and Warranties. As a material inducement to Seller to execute this Agreement and consummate the Closing, Buyer represents and warrants to Seller that:

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(a) Buyer has been duly formed or organized as a limited liability company, is validly existing and, is in good standing in the state of its organization, and is authorized to exercise all of its powers, rights and privileges.

(b) Buyer has the power and authority, under its Charter Documents, to own and operate its properties, to carry on its business as now conducted, and to enter into and perform its obligations under this Agreement.

(c) All action on the part of Buyer and its members, managers, and officers necessary for the authorization, execution and delivery of this Agreement, the performance of all obligations of Buyer hereunder and completion of the transactions hereunder, has been taken or will be taken prior to the Closing. This Agreement constitutes a legally binding and valid obligation of Buyer enforceable in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity).

(d) The execution and delivery of this Agreement by Buyer and the performance by Buyer of its obligations pursuant hereto will not result in any violation of, be in conflict with, or constitute a default under, with or without the passage of time or the giving of notice: (x) any provision of Buyer’s Charter Documents; (y) any provision of any judgment, decree or order to which Buyer is a party or by which it or its property or assets are bound; or (z) any Laws applicable to Buyer or its property or assets.

(e) The execution and delivery of this Agreement by Buyer and the performance by Buyer of its obligations pursuant hereto will not result in any violation of, be in conflict with, or constitute a default under, with or without the passage of time or the giving of notice, any material contract or agreement to which Buyer is a party.

(f) There is no action, suit, proceeding or investigation pending or, to the knowledge of Buyer, threatened in writing against Buyer that challenges the validity of this Agreement or the right of Buyer to enter into this Agreement, or that might result, either individually or in the aggregate, in Buyer’s inability to perform its obligations under this Agreement. There is no judgment, decree or order of any court, arbitrator, tribunal or governmental or similar authority in effect against Buyer, and Buyer is not in default with respect to any order of any court, arbitrator, tribunal or governmental or similar authority binding upon Buyer or by which it or its property or assets are bound that would prevent Buyer from performing its obligations under this Agreement.

(g) Buyer is not acting, directly or indirectly for, or on behalf of, any Person, group, entity or nation named by any Executive Order (including the September 24, 2001, Executive Order Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism) or the United States Treasury Department as a terrorist, “Specially Designated National and Blocked Person, or other banned or blocked Person, group, entity, or nation pursuant to any Law that is enforced or administered by the Office of Foreign Assets Control, and is not engaging in the transactions described herein, directly or indirectly, on behalf of, or instigating or facilitating the transactions described herein, directly or indirectly, on behalf of, any such Person, group, entity or nation.

(h) Buyer is acquiring the Xxxxx Xxxx Interest for its own account, for investment purposes only and not with a view to the distribution (as such term is used in Section 2(11) of the Securities Act of 1933, as amended (the “Securities Act”)) thereof. Buyer understands that the Xxxxx Hill Interest has not been registered under the Securities Act and cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is available.

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4.4 Limitations. Except for the representations and warranties contained in Sections 4.1 and 4.2, or any documents delivered to Buyer at Closing in connection with this Agreement (collectively, “Seller’s Reps”), neither Seller nor any other Person (including, for the avoidance of doubt, any equity holder of Seller) makes any other express or implied representation or warranty in respect of the Xxxxx Xxxx Interest, BR Xxxxx Hill Member, Xxxxx Xxxx Venture, the Subsidiary, the Xxxxx Hill Property or the transaction contemplated hereby, and Seller disclaims all other representations or warranties, whether made by BR Xxxxx Xxxx Member, Xxxxx Hill Venture, the Subsidiary or any of their respective Affiliates, officers, directors, employees, agents or representatives. Except for Seller’s Reps, Seller hereby disclaims all liability and responsibility for any representation, warranty, projection, forecast, statement, or information made, communicated, or furnished (orally or in writing) to Buyer or its Affiliates or representatives (including any opinion, information, projection or advice that may have been or may be provided to Buyer by any director, officer, employee, agent, consultant or representative of BR Xxxxx Xxxx Member, Xxxxx Hill Venture, the Subsidiary or any of their respective Affiliates). EXCEPT FOR AND SUBJECT ONLY TO SELLER’S REPS, SELLER MAKES NO REPRESENTATIONS OR WARRANTIES WHATSOEVER, EXPRESS, IMPLIED OR STATUTORY, RELATING TO THE XXXXX XXXX INTEREST, BR XXXXX HILL MEMBER, XXXXX XXXX VENTURE, THE SUBSIDIARY, THE XXXXX HILL PROPERTY OR ANY PORTION THEREOF, OR THE CONDITION OF OR MATERIALS RELATING TO THE XXXXX XXXX INTEREST, BR XXXXX HILL MEMBER, XXXXX XXXX VENTURE, THE SUBSIDIARY OR THE XXXXX HILL PROPERTY, IN WHOLE OR IN PART, OR ANY OTHER MATTER, ALL SUCH REPRESENTATIONS AND WARRANTIES BEING HEREBY EXPRESSLY DISCLAIMED. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, AND EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT AND SUBJECT ONLY TO SELLER’S REPS, BUYER IS PURCHASING THE XXXXX XXXX INTEREST “AS IS” AND “WITH ALL FAULTS.” The disclaimer expressed in this Section 4.4 shall survive Closing.

4.5 Survival of Representations and Warranties. The representations and warranties set forth in this Article 4 are made as of the Effective Date. Such representations and warranties shall not be deemed to be merged into or waived by the instruments of Closing, but shall survive the Closing for a period of twelve (12) months (the “Limitation Period”); provided that (a) the representations and warranties set forth in Sections 4.1(a), (b), (c) and (d) and Section 4.2, (the “Warranties”) shall survive the Closing indefinitely. Seller and Buyer shall have the right to bring an action for breach of such representations and warranties if they give the other party written notice of the circumstances giving rise to the alleged breach within the survival period specified therefor in this Section 4.5.

ARTICLE 5. INDEMNIFICATION AND LIMITATION ON LIABILITY

5.1 Indemnification between Seller and Buyer. Seller, on the one hand, and Buyer, on the other hand (for purposes of this Section 5.1, each an “indemnitor”), shall indemnify, defend and hold the other (for purposes of this Section 5.1, the “indemnified party”) harmless from any liability, claim, demand, loss, expense or damage that is: (a) suffered by, or asserted by any third party against the indemnified party arising from any act or omission of the indemnitor, its agents, employees or contractors or otherwise arising out of the ownership of the Xxxxx Hill Interest first arising or occurring prior to the Closing (with respect to Seller as indemnitor) or from and after the Closing (with respect to Buyer as the indemnitor); (b) arising out of the breach or inaccuracy of any of the indemnitor’s representations and warranties set forth herein; or (c) arising out of any failure by Seller or Buyer to perform any covenant or obligation of Seller or Buyer, as applicable, set out in this Agreement.

5.2 Limitation on Seller’s Liability. Notwithstanding any other provision of this Article 5 to the contrary, (a) Seller shall not have any indemnification obligations for claims under Section 5.1 unless and until the aggregate amount of such claims exceeds $30,000 (provided that, once the amount of such claims exceeds $30,000, Seller shall pay damages from the first dollar of damages) and (b) in no event shall Seller’s aggregate liability for claims under Section 5.1 of this Agreement exceed $369,034 ; provided, however, that the limitations on liability set forth in this Section 5.2 shall not apply to any loss or liability arising from any breach of any of Seller’s Warranties, or to Seller’s obligations with respect to reprorations under Section 3.2, which liability and obligations shall not be credited against the foregoing cap. The provisions of this Article 5 shall be the sole and exclusive remedy of Buyer with respect to matters which are subject to indemnification by Seller under Section 5.1 of this Agreement, all other remedies with respect to such matters being hereby waived.

5.3 Survival. The provisions of this Article 5 shall survive the Closing; provided that claims under clause (a) or (b) of Section 5.1 shall be subject to the Limitation Period. Any claim for indemnification under Section 5.1(a) or (b) not made on or prior to the expiration of the Limitation Period set forth in Section 4.5 shall be irrevocably and unconditionally waived and released.

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ARTICLE 6. MISCELLANEOUS

6.1 Parties Bound. No party may assign this Agreement without the prior written consent of the other party, and any such prohibited assignment shall be void. This Agreement shall be binding upon and inure to the benefit of the respective legal representatives, successors, permitted assigns, heirs, and devises of the parties.

6.2 Headings; Entirety; Amendments. The article and paragraph headings of this Agreement are for convenience only and in no way limit or enlarge the scope or meaning of the language hereof. All exhibits and appendices attached to this Agreement are incorporated herein as if fully set forth in this Agreement and shall be deemed to be a part of this Agreement. This Agreement embodies the entire agreement between the parties and supersedes all prior agreements and understandings relating to the Xxxxx Xxxx Interest, BR Xxxxx Hill Member, Xxxxx Xxxx Venture, the Subsidiary or the Xxxxx Hill Property (other than the Charter Documents of BR Xxxxx Xxxx Member, Xxxxx Hill Venture and the Subsidiary). This Agreement may be amended or supplemented (except as noted in the preceding sentence) only by an instrument in writing executed by the party against whom enforcement is sought.

6.3 Invalidity and Waiver. If any portion of this Agreement is held invalid or inoperative, then so far as is reasonable and possible the remainder of this Agreement shall be deemed valid and operative, and, to the greatest extent legally possible, effect shall be given to the intent manifested by the portion held invalid or inoperative. The failure by a party to enforce against another party any term or provision of this Agreement shall not be deemed to be a waiver of such party’s right to enforce against the other party the same or any other such term or provision in the future.

6.4 Governing Law; Calculation of Time Periods; Time. This Agreement shall, in all respects, be governed and enforced in accordance with the laws of the State of New York. Unless otherwise specified, in computing any period of time described herein, the day of the act or event after which the designated period of time begins to run is not to be included and the last day of the period so computed is to be included, unless such last day is a Saturday, Sunday or legal holiday for national banks in New York, New York, in which event the period shall run until the end of the next day which is neither a Saturday, Sunday, or legal holiday. The last day of any period of time described herein shall be deemed to end at 5:30 p.m. New York, New York time. Time is of the essence in the performance of this Agreement.

6.5 No Third Party Beneficiary. This Agreement is not intended to give or confer any benefits, rights, privileges, claims, actions, or remedies to any Person as a third party beneficiary, decree, or otherwise, other than the indemnified parties referenced in Section 5.1 pursuant to and for purposes of Section 5.1, who shall be express third party beneficiaries hereof solely for purposes of Section 5.1.

6.6 Confidentiality. No party shall make a public announcement or other disclosure of this Agreement or any information related to this Agreement to outside brokers or third parties, before or after the Closing, without the prior written specific consent of the other, which consent may not be unreasonably conditioned, delayed or withheld so long as such public disclosure is otherwise in compliance with this Agreement; provided, however, that without the consent of the other party, a party may make (i) any public disclosure it reasonably believes is required by applicable Laws (in which event such party shall use reasonable efforts to advise the other party prior to the making of such disclosure); (ii) such disclosure as may be reasonably necessary to enforce any provision of this Agreement; (iii) any disclosure to any lender or prospective lender, creditor, officer, employee, agent, current or prospective investor and their advisors, current or prospective financial partner, or Affiliate as necessary to perform its obligations under this Agreement or (iv) any public disclosure that is deemed advisable by such party or its counsel to be disclosed in connection with financial reporting, securities disclosures or other legal, tax or financial requirements or guidelines applicable to such party or any Affiliate thereof, including any disclosures to the Securities and Exchange Commission and any press release required by the Securities and Exchange Commission in connection therewith.

6.7 Enforcement Expenses. Should any party employ attorneys or arbitrators to bring an action or arbitration to enforce any of the provisions hereof, the non-prevailing party in such action or arbitration shall pay the prevailing party all reasonable costs, charges, and expenses, including attorneys’ fees and costs, expended or incurred in connection therewith (not to exceed, in the aggregate, $369,034). The limitations set forth in Section 5.2 shall not apply with respect to this Section 6.7.

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6.8 Notices. All notices required or permitted hereunder shall be in writing and shall be served on the following parties:

If to Buyer:	c/o Bluerock Enhanced Multifamily Advisor
	Heron Tower
	00 Xxxx 00xx Xxxxxx
	0xx Xxxxx
	Xxx Xxxx, XX 00000
	Attn:  Xxxxxxx X. Xxxxx
If to Seller:	c/o BR SOIF III Manager
	Heron Tower
	00 Xxxx 00xx Xxxxxx
	0xx Xxxxx
	Xxx Xxxx, XX 00000
	Attn: Jordan X. Xxxxx

6.9 Construction. The parties acknowledge that the parties and their counsel have reviewed and revised this Agreement and the documents to be executed on or prior to the Closing Date and agree that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement, the documents to be delivered on or prior to the Closing Date or any exhibits or amendments thereto.

6.10 Execution in Counterparts. This Agreement may be executed in any number of counterparts, and by each party hereto on separate counterparts, each of which shall be deemed to be an original, and all of such counterparts shall constitute one Agreement. To facilitate execution of this Agreement, the parties may execute and exchange by telephone facsimile or email counterparts of the signature pages which shall be deemed original signatures for all purposes.

6.11 Further Assurances. In addition to the acts and deeds recited herein and contemplated to be performed, executed and/or delivered by either party on or prior to the Closing Date, each party agrees to perform, execute and deliver, but without any obligation to incur any additional liability or expense, on or after the Closing any further deliveries and assurances as may be reasonably necessary to consummate the transactions contemplated hereby or to further perfect the conveyance, transfer and assignment of the Xxxxx Hill Interest to Buyer.

6.12 Waiver of Jury Trial; Forum. TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY SHALL BRING ANY ACTION AGAINST THE OTHER IN CONNECTION WITH THIS AGREEMENT IN A FEDERAL OR STATE COURT LOCATED IN NEW YORK, NEW YORK, CONSENTS TO THE JURISDICTION OF SUCH COURTS, AND WAIVES ANY RIGHT TO HAVE ANY PROCEEDING TRANSFERRED FROM SUCH COURTS ON THE GROUND OF IMPROPER VENUE OR INCONVENIENT FORUM.

6.13 Mutual Execution. Until this Agreement has been duly executed by both parties hereto and a fully executed copy has been delivered to each party hereto (which may occur by facsimile transmission or e-mail), this Agreement shall not be legally binding against the parties.

6.14 Cooperation. Subject to the provisions of this Agreement, the parties agree to cooperate and use Commercially Reasonable Efforts to consummate the transactions contemplated hereby.

8

IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Agreement as of the Effective Date.

	SELLER:
	BLUEROCK SPECIAL OPPORTUNITY + INCOME
	FUND III, LLC,
	a Delaware limited liability company
	By:	BR SOIF III Manager, LLC,
		a Delaware limited liability company,
		its Manager

		By:	/s/ Jordan X. Xxxxx
			Jordan X. Xxxxx, President

	BUYER:
	BEMT XXXXX HILL, LLC,
	a Delaware limited liability company
	By:	Bluerock Enhanced Multifamily Holdings, LP,
		a Delaware limited partnership,
		its Manager

		By:	Bluerock Enhanced Multifamily Trust, Inc.,
			a Maryland corporation,
			its general partner

		By:	/s/ Jordan X. Xxxxx
			Jordan X. Xxxxx, President
			and Chief Operating Officer

9

Exhibit A

Organizational Chart

[SEE ATTACHMENT]

APPENDIX 1.2

Defined Terms

“Affiliate” shall mean: (a) an entity that directly or indirectly controls, is controlled by or is under common control with the party in question; or (b) an entity at least a majority of whose economic interest is owned by the party in question; and the term “control” means the power to direct the management of such entity through voting rights, ownership or contractual obligations.

“Agreement” shall have the meaning given to it in the preamble to this Agreement.

“Assignment of Interest” shall have the meaning given to it in Section 2.1(a) hereof.

“Xxxxx Hill Interest” shall have the meaning given to it in the Recitals to this Agreement.

“Xxxxx Xxxx Property” shall mean that certain 266-unit multi-family development project known as 23Hundred@Xxxxx Hill, Nashville, Tennessee, including the Real Property, the Leases, the Rents, the Personal Property, and the Intangible Property.

“Xxxxx Xxxx Venture” shall have the meaning given to it in the Recitals to this Agreement.

“BR Xxxxx Hill Member” shall have the meaning given to it in the Recitals to this Agreement.

“Business Day” shall mean a day other than a Saturday, Sunday or other day on which commercial banks are authorized or required to close under applicable Laws, or are in fact closed, in New York, New York.

“Buyer” shall have the meaning given to it in the preamble to this Agreement.

“Charter Documents” shall mean, with respect to any entity, its articles of incorporation, declaration of trust, bylaws, partnership agreement, statement of partnership, certificate of limited partnership, limited liability company agreement, limited liability certificate or articles, or other charter or governing or organizational documents, and all amendments or supplements to any of the foregoing (but excluding the Venture Agreement Amendment).

“Closing” shall have the meaning given to it in Article 2 hereof.

“Closing Date” shall mean the date on which the Closing occurs.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.

“Commercially Reasonable Efforts” shall mean, whenever there is imposed on any party such standard, that such party shall be required to exert those efforts or diligence only to the extent they are economically feasible, practicable and reasonable under the circumstances and shall not impose upon such party material financial or other burdens or require any party to institute any legal action.

“Consideration” shall have the meaning given to it in Section 1.1 hereof.

“Encumbrances” shall mean any and all security interests, pledges, liens, charges, claims, purchase options or other encumbrances or restrictions of any kind, including, without limitation, any restriction on the use, transfer, receipt of income or other exercise of any attribute of ownership (not including applicable Laws).

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

“Governmental Authority” shall mean any governmental authority having jurisdiction over the Xxxxx Xxxx Property, Buyer, Seller, BR Xxxxx Hill Member, Xxxxx Xxxx Venture, the Subsidiary or any of their respective Affiliates, including, without limitation, the United States of America, the state, county and municipality where the Xxxxx Hill Property is located, and any court, agency, department, commission, board, bureau, utility district, flood control district, improvement district or similar district, or other instrumentality of any of them.

“Improvements” shall mean all buildings, fixtures, structures, parking areas, landscaping and other improvements located on the Land.

“Intangible Property” shall mean all right, title and interest of the Subsidiary in and to all intangible personal property owned by the Subsidiary and now or hereafter used in connection with the operation, ownership, maintenance, management, or occupancy of the Real Property, including, without limitation, any and all trade names and trademarks associated with the Real Property; the plans and specifications for the Improvements, including as-built plans; unexpired warranties, guarantees, indemnities and claims against third parties; contract rights related to the construction, operation, repair, renovation, ownership or management of the Real Property; pending permit or approval applications as well as existing permits, approvals and licenses (to the extent assignable); insurance proceeds and condemnation awards; and books and records relating to the Real Property.

“Land” shall mean the land owned by the Subsidiary, and all rights, benefits, privileges, easements, tenements, hereditaments, and appurtenances in anywise appertaining to the Land, including any and all mineral rights, development rights, water rights and the like; and all right, title, and interest of the Subsidiary in and to all strips and gores and any land lying in the bed of any street, road or alley, open or proposed, adjoining the Land.

“Laws” shall mean all applicable federal, state and local laws, rules, ordinances, regulations and codes, including without limitation, all zoning, building, health and safety, environmental, land use and requirements regarding disabled Persons.

“Leases” shall mean all leases, subleases or other occupancy agreements pursuant to which any Person has the right to occupy space in the Improvements.

“Limitation Period” shall have the meaning given to it in Section 4.5 hereof.

“Loan” shall mean the mortgage loan encumbering the Xxxxx Xxxx Property.

“Loan Documents” shall mean the documents and instruments evidencing and securing the Loan.

“Organizational Chart” shall have the meaning given to it in the Recitals to this Agreement.

“Person” shall mean a corporation, partnership, limited liability company, business trust or individual.

“Personal Property” shall mean as to the Real Property, all right, title and interest of the Subsidiary in and to all tangible personal property now or hereafter used in connection with the operation, ownership, maintenance, management, or occupancy of the Real Property, including, without limitation, all equipment, machinery, heating, ventilating and air conditioning units, furniture, art work, furnishings, trade fixtures, office equipment and supplies, and, whether stored on or off-site, all tools and maintenance equipment, supplies, and construction and finish materials not yet incorporated in the Improvements but held for repairs and replacements.

“Real Property” shall mean the Land and the Improvements.

“Reconciliation” shall have the meaning given to it in Section 1.1 hereof.

“Rents” shall mean all income from the Real Property, including without limitation, all fixed or base rent, percentage rent, additional rent or other amounts payable by tenants under Leases with respect to operating expenses, Taxes or other charges under the Leases.

Securities Act” shall have the meaning given to it in Section 4.3(h) hereof.

“Seller” shall have the meaning given to it in the preamble to this Agreement.

“Subsidiary” shall have the meaning given to it in the Recitals to this Agreement.

“Taxes” shall mean all federal, state, local, foreign, and other taxes, including, without limitation, income taxes, estimated taxes, alternative minimum taxes, excise taxes, sales taxes, use taxes, value-added taxes, gross receipts taxes, bulk sales taxes, transient occupancy taxes, franchise taxes, capital stock taxes, employment and payroll-related taxes, withholding taxes, stamp taxes, Transfer Taxes and property taxes, whether or not measured in whole or in part by net income, and all deficiencies or other additions to taxes, including interest, fines and penalties.

“Transfer Taxes” shall mean any and all taxes on the transfer, or deemed transfer, of the Xxxxx Xxxx Property as a result of the conveyance of Xxxxx Hill Interest pursuant to this Agreement payable pursuant to applicable Laws, but if and only to the extent that the conveyance of the Xxxxx Xxxx Interest pursuant to this Agreement is deemed to constitute a transfer of the Xxxxx Hill Property that is subject to such tax, but not including real estate taxes or income taxes.

“Venture Agreement” shall mean the limited liability company agreement governing BR Xxxxx Xxxx Member, as amended, supplemented or amended and restated prior to the Effective Date.

“Venture Agreement Amendment” shall have the meaning given to it in Section 2.1(c) hereof.

“Warranties” shall have the meaning given to it in Section 4.5 hereof.

APPENDIX 2.1(a)

Assignment of Interest

[see attached]

APPENDIX 2.1(c)

Venture Agreement Amendment

[see attached]