State of Tennessee  FHA Project No.:  087-35247

 
DEED OF TRUST NOTE
(Corporate)
 
 

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$12,972,200.00   Chattanooga, Tennessee    October 14, 2010

 
For Value Received, the undersigned BR CREEKSIDE LLC, a Delaware limited
liability company, promise(s) to pay to WALKER & DUNLOP, LLC, a limited
liability company organized and existing under the laws of the State of
Delaware, or order, the principal sum of TWELVE MILLION NINE HUNDRED SEVENTY-TWO
THOUSAND TWO HUNDRED AND NO/100THS DOLLARS ($12,972,200.00), with interest from
date at the rate of Four and 60/100ths per centum (4.60%) per annum on the
unpaid balance until paid.  The said principal and interest shall be payable in
monthly installments as follows:

Interest alone shall be due and payable on the first day of November,
2010.  Thereafter, commencing on December 1, 2010, monthly installments of
principal and interest at the rate of Four and 60/100ths percent (4.60%) per
annum shall be due and payable in the sum of Fifty Nine Thousand One Hundred
Fifty Four and 66/100ths Dollars ($59,154.66) on the first day of each
succeeding month, until the entire indebtedness has been paid in full.  In any
event, the balance of principal (if any) remaining unpaid, plus accrued
interest, shall be due and payable on November 1, 2050.  The installments of
principal and interest shall be applied first to interest at the rate aforesaid
upon the principal sum or so much thereof as shall from time to time remain
unpaid and the balance thereof shall be applied on account of principal.

 
See Rider attached hereto and incorporated herein by reference.

 

Both principal and interest shall be payable at the office of Walker & Dunlop,
LLC, in the State of Maryland, or such other place as the holder may designate
in writing.
Privilege is reserved to pay the debt in whole or in an amount equal to one or
more monthly payments on principal next due, on the first day of any month prior
to maturity upon at least thirty (30) days' prior written notice to the
holder.  Notwithstanding any provision herein for a prepayment charge, such
charge shall be applicable only to the amount of prepayment in any one calendar
year which is in excess of fifteen per centum (15%) of the original principal
sum of this Note.
If default be made in the payment of any installment under this note, and if
such default is not made good prior to the due date of the next such
installment, the entire principal sum and accrued interest shall at once become
due and payable without notice, at the option of the holder of this
note.  Failure to exercise this option shall not constitute a waiver of the
right to exercise the same in the event of any subsequent default.  In the event
of default in the payment of this note, and if the same is collected by an
attorney at law, the undersigned hereby agree(s) to pay all costs of collection,
including a reasonable attorney's fee.
No default shall exist by reason of nonpayment of any required installment of
principal so long as the amount of optional additional prepayments of principal
already made pursuant to the privilege of prepayment set forth in the deed of
trust securing this note equals or exceeds the amount of such required
installment of principal.
All parties to this note, whether principal, surety, guarantor, or endorser,
hereby waive presentment for payment, demand, protest, notice of protest, and
notice of dishonor.

 
 
 

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This Note is secured by a Deed of Trust of even date herewith duly recorded in
the Register’s Office, County of Hamilton, State of Tennessee, covering real
estate located in said County.

Signed and sealed this 14th date of October, 2010.

BR CREEKSIDE LLC,
a Delaware limited liability company

By:  BR HAWTHORNE CREEKSIDE JV LLC,
       a Delaware limited liability company,
        its sole Member

       By:  BR CREEKSIDE MANAGING MEMBER LLC,
               a Delaware limited liability company,
               its Manager
 
 
               By:  BLUEROCK SPECIAL OPPORTUNITY +
                       INCOME FUND, LLC,
                       a Delaware limited liability company,
                       its Manager

                     By:  BLUEROCK REAL ESTATE, L.L.C.,
                             a Delaware limited liability company,
                             its sole Manager

                            By:   /s/ Jordan
Ruddy                                        
                                    Jordan Ruddy
President
 

 
This is to Certify that this is the note described in and secured by Deed of
Trust of even date herewith, and in the same principal amount as herein stated,
to Frank Alvstad, a resident of Davidson County, Tennessee, Trustee, on real
estate located in Hamilton County, Tennessee.
 

Dated the ______ day of October, 2010.
                                
 

     [SEAL]    Notary Public

 

 
My commission expires on the _____ day of ___________________, 20___.
 
 
 
 
 

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STATE OF TENNESSEE

Loan No. 087-35247
________________________________________
Deed of Trust Note
________________________________________

BR CREEKSIDE LLC
a  Delaware limited liability company
TO

WALKER & DUNLOP, LLC
a Delaware limited liability company

No.   087-35247

     Insured under §221(d)(4) pursuant to §223(a)(7) of the National Housing Act
and Regulations published thereunder

In effect on  August 9, 2010

     To the extent of advances approved by the Secretary of Housing  and Urban
Development acting by and through the Federal Housing Commissioner

By:           
                             (Authorized Agent)

Date: ____________________________           

     A total sum of $12,972,200.00 has been approved for insurance hereunder by
the Secretary of Housing and Urban Development acting by and through the Federal
Housing Commissioner

By:      _____________________________________________     
                             (Authorized Agent)

Date: ________________________________________

For purposes of compliance with Section 223(a)(7)(A)(iv) of the National Housing
Act, the contract of mortgage insurance regarding FHA Project No. 087-35199 is
transferred to FHA Project No. 087-35247, and said contract of mortgage
insurance is hereby amended to reflect the terms, conditions and provisions of
the FHA Firm Commitment for Project No. 087-35247 dated August 9, 2010, and the
National Housing Act as evidenced by the Federal Housing Commissioner’s
endorsement for insurance of this Deed of Trust Note dated October ____, 2010,
executed by BR Creekside LLC, a Delaware limited liability company (Maker), and
payable to Walker & Dunlop, LLC, a Delaware limited liability company, in the
amount of $12,972,200.00.
 
 
 
 
 

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Creekside Village Apartments
Chattanooga, Tennessee
FHA No. 087-35247

 
RIDER TO DEED OF TRUST NOTE
 
A.           Incorporation by Reference.  This Rider is incorporated by
reference into and made a part of that Deed of Trust Note (the “Note”) dated as
of October 14, 2010, executed by BR CREEKSIDE LLC, a Delaware limited liability
company (the “Maker”), and payable to WALKER & DUNLOP, LLC, a Delaware limited
liability company (“Mortgagee”), in connection with the following housing
project:
 
Creekside Village Apartments
Chattanooga, Tennessee
FHA No. 087-35247
 
B.           Prepayment Premium.  Notwithstanding any provision in this Note to
the contrary—except Paragraph D to this Rider, “HUD Override”—the loan evidenced
by this Note may not be prepaid in whole or in part prior to December 1,
2012.  Thereafter, the indebtedness evidenced by this Note may be prepaid, in
whole or part, on the last day of any calendar month during the term hereof upon
at least 30 days prior written notice to the holder of this Note, which notice
shall specify the date on which the prepayment is to be made, the principal
amount of such prepayment and the total amount to be paid (provided, however,
that the Mortgagee shall not be obligated to accept any prepayment unless and
until such time as HUD has approved such prepayment, if and to the extent that
HUD’s approval shall be required under applicable HUD requirements in effect as
of the date of the prepayment).  In the event of any prepayment of principal at
any time, the Maker shall concurrently pay to the holder of this Note a
prepayment premium equal to the following designated percentages of the amount
of the principal of this Note to be prepaid with respect to any prepayment which
occurs during the following indicated time periods:
 
Time of
Prepayment                                                                                                                                         
 Prepayment Premium
(1)           from December 1, 2012 through November 30,
2013                                                                                                8%
(2)           from December 1, 2013 through November 30,
2014                                                                                                7%
(3)           from December 1, 2014 through November 30,
2015                                                                                                6%
(4)           from December 1, 2015 through November 30,
2016                                                                                                5%
(5)           from December 1, 2016 through November 30,
2017                                                                                                4%
(6)           from December 1, 2017 through November 30,
2018                                                                                                3%
(7)           from December 1, 2018 through November 30,
2019                                                                                                2%
(8)           from December 1, 2019 through November 30,
2020                                                                                                1%
(9)           from December 1, 2020 and
thereafter                                                                                                                 
  0%
 
C.           Obligation to Make Monthly Scheduled Payments.  Notwithstanding any
partial prepayment of principal made pursuant to the privilege of prepayment set
forth in this Note, the Maker shall not be relieved of its obligations to make
scheduled monthly installments of principal and interest as and when such
payments are due and payable hereunder.
 
D.           HUD Override.  Notwithstanding any prepayment premium imposed by
this Deed of Trust Note or that certain Deed of Trust of even date herewith
securing this Note (the “Deed of Trust”) with respect to prepayments made prior
to December 1, 2019, the indebtedness evidenced by this Note may be prepaid in
whole or in part without the consent of the holder of this Note and without
prepayment premium if the Federal Housing Commissioner determines that
prepayment will avoid a mortgage insurance claim and is therefore in the best
interests of the federal government.
 
E.           Late Charge.  The Mortgagee may collect a late charge of two cents
($0.02) for each one dollar ($1.00) of each payment of interest and principal
which has not been received by the Mortgagee or its designee in immediately
available funds on or prior to the sixteenth (16th) day of the month during
which such payment is due in order to cover the extra expenses involved in
handling delinquent payments.  Such late charge shall be separately charged and
collected and shall not be deducted from any monthly installment or collected
from any reserve escrow, residual receipts funds, or from any interest accruals
thereto.
 
F.           Makers Nonrecourse Liability.  Notwithstanding any provision of
this Note or the Deed of Trust to the contrary, it is agreed that the execution
of this Note shall impose no personal liability on the Maker, for payment of the
indebtedness evidenced hereby and in the event of a default, the holder of this
Note shall look solely to the property described in the Deed of Trust and the
Security Agreement executed by and between the Maker and the Mortgagee of even
date herewith, and to the rents, issues and profits thereof in satisfaction of
the indebtedness evidenced by this Note and will not seek or obtain any
deficiency or personal judgment against the Maker, except such judgment or
decree as may be necessary to foreclose and bar its or their interest in the
property and all other property mortgaged, pledged, conveyed or assigned to
secure

 
 
 

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payment of this Note, provided that nothing in this condition and no action so
taken shall operate to impair any obligation of the Maker under the Regulatory
Agreement referred to in and made a part of the Deed of Trust.
 
G.           Insurance and Condemnation Proceeds.  The provisions of Paragraph B
of this Rider shall not apply and no prepayment premium shall be collected by
the Mortgagee with respect to any prepayment which is made by or on behalf of
the Maker from insurance proceeds as a result of damage to the property or
condemnation awards which may, at the option of the Mortgagee, be applied to
reduce the indebtedness evidenced by the Note pursuant to the terms of the Deed
of Trust given of even date to secure the indebtedness evidenced by the
Note.  If any prepayment occurs as provided in this Paragraph, the remaining
payments due on this Note may, at the option of the Mortgagee and with the
consent of the Commissioner, be recast such that required monthly payments of
principal and interest shall be in equal amounts sufficient to amortize the
balance then due under this Note over the remaining term thereof.
 
IN WITNESS WHEREOF, the parties hereto have set their hands and seals on the day
and date first above written.
MAKER:
 
BR CREEKSIDE LLC,
a Delaware limited liability company

By:  BR HAWTHORNE CREEKSIDE JV LLC,
        a Delaware limited liability company,
        its sole Member

       By:  BR CREEKSIDE MANAGING MEMBER LLC,
               a Delaware limited liability company,
               its Manager
 
 
               By:  BLUEROCK SPECIAL OPPORTUNITY +
                       INCOME FUND, LLC,
                       a Delaware limited liability company,
                       its Manager

                     By:  BLUEROCK REAL ESTATE, L.L.C.,
                             a Delaware limited liability company,
                              its sole Manager

                            By:    /s/ Jordan Ruddy
                                    Jordan Ruddy
President