Company: BHM
Filing Date: 2025-10-08
Form Type: S-11
Source: 0001104659-25-097905
Chunk: 82

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-10-08
Form: S-11
Chunk 82
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 transaction through which we would bring onboard our Manager’s management team. The method by which we
could internalize these functions could take many forms, and may require agreement with the Manager. While we believe that there may be
substantial benefits to internalization of management functions at the appropriate time, there is no assurance that internalization will
be beneficial to us and our stockholders, and internalizing our management functions could reduce earnings per share and funds from operation
per share. For example, we may not realize the perceived benefits or we may not be able to properly integrate a new staff of managers
and employees or we may not be able to effectively replicate the services provided previously by our Manager or its affiliates. Internalization
transactions involving the internalization of managers affiliated with entity sponsors have also, in some cases, been the subject of litigation.
Even if these claims are without merit, we could be forced to spend significant amounts of money defending claims which would reduce the
amount of funds available for us to invest in properties or other investments to pay distributions. All these factors could have a material
adverse effect on our results of operations, financial condition and ability to pay distributions.

RISKS RELATED TO THE SEPARATION AND DISTRIBUTION

Bluerock Residential may fail to perform under various transaction agreements executed as part of the Separation.

In connection with the Separation
and prior to the Distribution, we, Bluerock Residential, and certain other parties entered into the Separation and Distribution Agreement
and various other agreements, including the Tax Matters Agreement. The Separation and Distribution Agreement and the Tax Matters Agreement,
together with the documents and agreements by which the internal reorganization was effected, determined the allocation of assets and
liabilities between the companies following the Separation for those respective areas and included indemnifications related to liabilities
and obligations. We will rely on Bluerock Residential to satisfy its performance and payment obligations under these agreements. If Bluerock
Residential is unable or unwilling to satisfy its obligations under these agreements, including its indemnification obligations, we could
incur operational difficulties and/or losses.

Potential indemnification obligations owed to Bluerock Residential pursuant to the Separation and Distribution Agreement may have a material adverse effect on our business, financial condition and results of operations.

The Separation and Distribution
Agreement provides for, among other things, the principal corporate transactions required to effect the Separation and the Distribution,
certain conditions to the Separation and the Distribution and provisions governing our relationship with Bluerock Residential