Exhibit 10.1

MASTER TRANSFER AGREEMENT

 

THIS MASTER TRANSFER AGREEMENT (the “Agreement”), is made effective as of April
30, 2019 by and among Comstock Holding Companies, Inc., a Delaware corporation
(the “Company” or “CHCI”), Comstock Development Services, L.C., a Virginia
limited liability company (“CDS”), and FR54, L.C., a Virginia limited liability
company (“FR54”).

 

RECITALS:

 

WHEREAS, the Company previously solicited investments in various land
development and homebuilding related Projects in the Washington Metropolitan
Statistical Area by and through the sale of certain membership interests in
Comstock Investors X, L.C. (“Investors X”);

 

WHEREAS, Investors X is divided into two classes of membership interests, with
the Company owning 100% of the Class A units and CDS owning 100% of the Class B
units;

 

WHEREAS, CDS purchased 390 Class B Units in Investors X and as a result became
the sole priority member entitled to a priority distribution of distributable
cash flow from the projects and currently maintains an aggregate total capital
account balance of $18,500,000 (the “Class B Membership Interest”);

 

WHEREAS, the Company owns 100 Class A Units in Investors X and receives all
distributable cash flow of the Projects after the full repayment of the priority
member’s Class B Unit capital account balance and its priority return (the
“Class A Membership Interest”) and is also the Manager of Investors X;

 

WHEREAS, Stonehenge Funding, L.C., a former lender to the Company
(“Stonehenge”), received shares of the Company’s Series C Non-Convertible
Preferred Stock, par value $0.01 per share (the “Series C Shares”) from the
Company in lieu of repayment of a portion of an unsecured loan payable to
Stonehenge, and FR54, a member of Stonehenge, received a distribution of Series
C Shares from Stonehenge (the “FR54 Series C Shares”);

 

WHEREAS, the Company is exiting homebuilding and land development activities in
favor of a migration to an asset management model, and in furtherance thereof,
entered into a master asset management agreement with CDS on March 30, 2018 with
an effective date as of January 1, 2018 (the “Asset Management Agreement”);

 

WHEREAS, to aid in the acceleration of the Company’s transition from its
homebuilding and land development activities, CDS desires to take over
management of Investors X and the associated liabilities of the Projects,
including but not limited to Project related indebtedness; and

 

WHEREAS, to facilitate a partial recapitalization of the Company, (i) CDS
desires to exchange its Class B Membership Interest with the Company for the
consideration and upon the terms and conditions set forth herein, and (ii) FR54
desires to exchange the FR54 Series C Shares with the Company for the
consideration and upon the terms and conditions set forth herein.

 

 

 

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AGREEMENT:

 

NOW, THEREFORE, in consideration of the mutual covenants contained in this
Agreement, and for other good and valuable consideration; the receipt and
adequacy of which are hereby acknowledged, the Company, FR54, and CDS agree as
follows:

 

ARTICLE I
DEFINITIONS

 

1.1

Definitions

.  For purposes of this Agreement, the following terms have the meanings set
forth below.

“Agreement” shall have the meaning ascribed to it in the Preamble.

“Asset Management Agreement” shall have the meaning ascribed to it in the
Preamble.

“Class A Membership Interest” shall have the meaning ascribed to it in the
Preamble.

“Class A Shares” means the Company’s Class A Common Stock, par value $0.01 per
share.

“Class B Membership Interest” shall have the meaning ascribed to it in the
Preamble.

“CDS” shall have the meaning ascribed to it in the Preamble.

“CDS Class A Exchange Shares” means 3,100,000 newly issued Class A Shares.

“CDS Series C Exchange Shares” means 1,220,000 newly issued Series C Shares.

“Company” or “CHCI” shall have the meaning ascribed to it in the Preamble but
shall not include any subsidiaries and affiliates unless expressly referenced or
scheduled as an exhibit to this Agreement.

“Contract” means any contract, agreement, arrangement, understanding or
instrument, whether oral or written.

“Damages” means all actions, lawsuits, proceedings, hearings, investigations,
charges, complaints, Third Party Claims, demands, injunctions, judgments,
orders, decrees, rulings, dues, liabilities, obligations, Taxes, liens,
assessments, levies, losses, fines, penalties, damages, costs, fees and
expenses, including reasonable attorneys’, accountants’, investigators’, and
experts’ fees and expenses incurred in investigating or defending any of the
foregoing.

“Disclosure Schedule” means the schedules delivered by the Company to CDS
concurrently herewith and identified by the parties as the Disclosure Schedule.

 

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“Environmental Claim” means any and all administrative, regulatory or judicial
actions, suits, demands, demand letters, directives, claims, liens,
investigations, proceedings or notices of noncompliance or violation (written or
oral) by any person alleging potential liability (including potential liability
for enforcement, investigation costs, cleanup costs, governmental response
costs, removal costs, remedial costs, natural resources damages, property
damages, personal injuries or penalties) arising out of, based on or resulting
from:  (1) the presence or Release into the environment of any Hazardous
Substance at any location, whether or not owned by the Company; or (2)
circumstances forming the basis of any violation or alleged violation of any
Environmental Law; or (3) any and all claims by any person seeking damages,
contribution, indemnification, cost recovery, compensation or injunctive relief
resulting from the presence or Release of any Hazardous Substances.

“Environmental Laws” means all federal, state or local statutes, laws, rules,
ordinances, codes, rule of common law, regulations, judgments and orders in
effect on the Closing Date and relating to protection of human health or the
environment (including ambient air, surface water, ground water, drinking water,
wildlife, plants, land surface or subsurface strata), including laws and
regulations relating to Releases or threatened Releases of Hazardous Substances,
or otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Hazardous Substances.

“Exchange Shares” means the CDS Class A Exchange Shares, the FR54 Class A
Exchange Shares and the CDS Series C Exchange Shares.

“FR54” shall have the meaning ascribed to it in the Preamble.

“FR54 Class A Exchange Shares” means 723,947 newly issued Class A Shares.

“FR54 Series C Shares” has the meaning ascribed to it in the Preamble.

“Hazardous Substances” means: (1) any petroleum or petroleum products,
radioactive materials, asbestos in any form, mold, mildew, urea formaldehyde
foam insulation, transformers or other equipment that contain dielectric fluid
containing regulated levels of polychlorinated biphenyls (PCBs) and radon gas;
and (2) any chemicals, materials or substances which are now or ever have been
defined as or included in the definition of “medical wastes,” “hazardous
substances,” “hazardous wastes,” “hazardous materials,” “extremely hazardous
wastes,” “restricted hazardous wastes,” “toxic substances,” “toxic pollutants,”
or other words of similar import, under any Environmental Law.

“Indebtedness” for any Project means all obligations of such Project (1) for
borrowed money evidenced by notes, bonds, debentures or similar instruments, (2)
for the deferred purchase price of goods or services, (3) under capital leases,
and (4) in the nature of guarantees of the obligations described in clauses (1)
through (3) above of any other person.  

“Investors X” has the meaning ascribed to it in the Preamble.

“Investors X Operating Agreement” means that certain operating agreement entered
into the Company and Comstock Development Services, LC, dated August 15, 2016,
as thereafter amended from time to time.

 

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“Liabilities” means all Indebtedness, obligations and other liabilities of the
Projects of any nature whatsoever, whether direct or indirect, matured or
unmatured, absolute, accrued, contingent (or based on any contingency), known or
unknown, fixed or otherwise, or whether due or to become due.

“Project” has the meaning set forth in the Investors X Operating Agreement.

“Real Property” means all parcels and tracts of land (including any land lying
in the bed of any highway, street, road or avenue, opened or proposed, in front
of, or abutting or adjoining, such parcels and tracts of land) owned by a
Project, including permits, permitted improvements and all appurtenances
thereto.

“Series C Shares” shall have the meaning ascribed to it in the Preamble.

“Stonehenge” shall have the meaning ascribed to it in the Preamble.

 

1.2

Other Defined Terms

. Other capitalized terms used in this Agreement which are not defined in this
ARTICLE I shall have the meanings granted to them elsewhere in this
Agreement.  In the event there is a defined term not specifically defined in
this Agreement, it shall have the meaning set forth in the Investors X Operating
Agreement.

Article II
exchange of SHARES and MEMBERSHIP INTERESTS; OTHER TRANSACTIONS; CLOSING

 

2.1

The Exchange

.  Subject to the terms and conditions of this Agreement, on the Closing Date:

 

2.1.1

CDS Exchange.

(a)CDS shall assign, transfer and deliver to the Company all of its right,
title, interest in and to the Class B Membership Interest, free and clear of all
liens, pledges, encumbrances, charges, restrictions or known claims of any kind,
nature, or description (“Liens”) (except for those created by this Agreement and
other than restrictions under applicable federal, state and other securities
laws).  

(b)In consideration of the transfer of the Class B Membership Interest to the
Company, the Company shall, upon surrender of the certificate or certificates
representing the Class B Membership Interests (or in lieu thereof, the delivery
of an affidavit of lost security in the customary form) accompanied by a stock
power endorsed in blank:

(i)assign, transfer and deliver to CDS all of its right, title, interest in and
to the Class A Membership Interest, free and clear of any Liens (except for
those created by this Agreement and other than restrictions under applicable
federal, state and other securities laws);

 

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(ii)issue to CDS the CDS Class A Exchange Shares; and

(iii)issue to CDS the CDS Series C Exchange Shares.

 

2.1.2

FR54 Exchange.

(a)FR54 shall assign, transfer and deliver to the Company 579,158 Series C
Shares, free and clear of any Liens (except for those created by this Agreement
and other than restrictions under applicable federal, state and other securities
laws).

(b)In consideration of the transfer of the FR54 Series C Shares to the Company,
the Company shall issue to FR54 the FR54 Class A Exchange Shares upon surrender
of the certificate or certificates representing the FR54 Series C Shares (or in
lieu thereof, the delivery of an affidavit of lost security in the customary
form) accompanied by a stock power endorsed in blank.

 

2.1.3

Valuation.

(a)The Class A Shares will be valued by taking the consolidated closing bid
price of the Class A Shares on Nasdaq immediately preceding the entering into
this Agreement and then adding a premium to such closing price so that the Class
A Shares will be valued at no less than $4.00 per share.  

(b)The Series C Shares are valued at a price of $5.00 per share.  

2.2Concurrent Arrangements Pertaining to the Homebuilder; Additional

Consideration

As additional consideration for the transactions set forth in Section 2.1.1, at
the Closing, CDS shall: (a) either directly or through the ownership structure
of CDS, assume all of the existing debt of the Projects owed to institutional
lenders as set forth on Schedule 2.3(a) (the “Assumed Indebtedness”); (b) assume
all bond and associated contingent liabilities (“Bond Liabilities”) as set forth
on Schedule 2.3(b); (c) enter into amendments to the Investors X Operating
Agreement and each Project entity listed on Schedule 3.4.6 to assume the
management of such entities; (d) (i) execute a cash exercise of a previously
issued Warrant W-113 at a $1.75 exercise price for 150,000 Class A Shares and
(ii) execute a cash exercise of a previously issued Warrant W-112 at a $1.93
exercise price for 50,000 Class A Shares; (e) enter into a professional services
management agreement with the Company or its designated subsidiary for the
provision of accounting, tax, finance, legal, advisory and related professional
services related to the Projects in accordance with the terms set forth therein
in the form attached hereto as Exhibit A; and (e) enter into an amended and
restated Asset Management Agreement in the form attached hereto as Exhibit B.

Time and Place of Closing

.  The closing of the transactions set forth in this Agreement shall be held at
10:00 a.m. at the offices of the Company at 1886 Metro Center Drive, 4th Floor,
Reston, Virginia 20190, on April 30, 2019, or on such other date, time or place
as shall be mutually agreed upon by the

 

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Company, FR54 and CDS (the “Closing Date”); provided, however, that the Closing
Date shall be automatically extended from time to time for so long as any of the
conditions set forth in Sections 4.1 and 4.2 shall not be satisfied or waived
subject to Section 7.1.2.

Article III
REPRESENTATIONS AND WARRANTIES

 

3.1

General Statement

.  All representations and warranties set forth herein or in any exhibit,
certificate or other document delivered by a party hereto to any other party
pursuant to this Agreement shall survive the Closing (and none shall merge into
any instrument of conveyance), regardless of any investigation or lack of
investigation by any of the parties to this Agreement.  No specific
representation or warranty shall limit the generality or applicability of a more
general representation or warranty.  All representations and warranties of the
Company are made subject to the exceptions noted in the Disclosure Schedule.

 

3.2

Representations and Warranties of CDS

.  CDS represents and warrants to the Company as follows:

3.2.1

Organization, Existence and Good Standing.  CDS is a limited liability company
duly organized, validly existing and in good standing under the laws of the
Commonwealth of Virginia.

3.2.2

Power and Authority.  CDS has the power and authority to execute, deliver and
perform this Agreement and each of the documents and instruments required to be
entered into by it pursuant to this Agreement, and to consummate the
transactions contemplated hereby and thereby.  The execution, delivery and
performance by it of this Agreement and each of the documents and instruments
required to be entered into by it pursuant to this Agreement, and the
consummation of the transactions contemplated hereby and thereby, have been duly
and validly authorized by all necessary limited liability company action and
such authorization has not been withdrawn or amended in any manner.  

3.2.3

Enforceability.  This Agreement constitutes a legal, valid and binding
obligation of CDS (assuming that this Agreement has been, and each of the
documents and instruments required to be entered into by CDS pursuant to this
Agreement will be, duly and validly authorized, executed and delivered by the
other persons party thereto), enforceable against CDS in accordance with their
respective terms, except that (a) such enforcement may be subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws, now or
hereafter in effect, affecting creditors’ rights generally, and (b) the remedy
of specific performance and injunctive and other forms of equitable relief may
be subject to equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought.

3.2.4

Consents. No consent, approval or authorization of, or designation, declaration
or filing with, any governmental authority or notice, approval, consent waiver
or authorization from any third party is required on the part of CDS with
respect to CDS’ execution, delivery or performance of its obligations under this
Agreement or the consummation of the

 

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transactions contemplated hereby, except for any consent, approvals,
authorizations, designations, declarations, waivers or filings, the absence of
which would not have a material adverse effect on CDS.

3.2.5Ownership. CDS is the sole record holder and beneficial owner of the Class
B Membership Interest. CDS owns the Class B Membership Interest free and clear
of all Liens. There are no outstanding rights, options, warrants, conversion
rights, repurchase rights, agreements, arrangements, calls, commitments or
rights of any kind that obligate CDS to sell the Class B Membership Interest or
any securities or obligations convertible or exchangeable into or exercisable
for, or giving any person a right to subscribe for or acquire the Class B
Membership Interest.

 

3.2.6Access to Information; Advice. CDS (either alone or together with its
advisors) has such knowledge and experience in financial or business matters
that it is capable of evaluating the merits and risks of the transactions
contemplated hereby. CDS has had the opportunity to discuss the transactions
contemplated hereby with the management of the Company and has had the
opportunity to obtain such information pertaining to the Company as has been
requested. CDS has received all information that it believes is necessary or
appropriate in connection the transactions contemplated hereby. CDS is an
informed and sophisticated party and has engaged, to the extent CDS deems
appropriate, expert advisors experienced in the evaluation of transactions of
the type contemplated hereby. CDS acknowledges that it has not relied upon any
express or implied representations or warranties of any nature made by or on
behalf of the Company or FR54, whether or not any such representations,
warranties or statements were made in writing or orally, except as expressly set
forth for the benefit of CDS in this Agreement.  CDS is relying solely upon the
advice of its own legal, tax and financial advisers with respect to the tax and
other legal aspects of this Agreement.

 

3.2.7Exemption from Registration.  Neither CDS nor any of its affiliates nor any
person acting on behalf of or for the benefit of any of the forgoing, has paid
or given, or agreed to pay or give, directly or indirectly, any commission or
other remuneration (within the meaning of Section 3(a)(9) of the Securities Act
of 1933, as amended (the “Securities Act”), and the rules and regulations
promulgated thereunder) for soliciting the transactions contemplated
hereby.  CDS also understands that the CDS Class A Exchange Shares are being
offered and issued pursuant to an exemption from the registration requirements
of the Securities Act, under Section 3(a)(9), Section 4(a)(2) of the Securities
Act and/or Regulation D promulgated under the Securities Act.

 

3.2.8Accredited Investor; No Registration. CDS represents that it is an
“accredited investor” within the meaning of Rule 501(a) of the Securities Act.
CDS understands that neither the CDS Class A Exchange Shares nor the Class A
Membership Interest have not been registered under the Securities Act or any
other applicable securities laws. CDS understands that neither the CDS Class A
Exchange Shares nor the Class A Membership Interest may be offered, sold or
otherwise transferred except in compliance with the registration requirements of
the Securities Act and any other applicable securities laws or pursuant to an
exemption therefrom, and in each case in compliance with the conditions set
forth in this Agreement.

 

 

3.3

Representations and Warranties of FR54

 

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.  FR54 represents and warrants to the Company as follows:

3.3.1

Organization, Existence and Good Standing.  FR54 is a limited liability company
duly organized, validly existing and in good standing under the laws of the
Commonwealth of Virginia.

3.3.2

Power and Authority.  FR54 has the power and authority to execute, deliver and
perform this Agreement and each of the documents and instruments required to be
entered into by it pursuant to this Agreement, and to consummate the
transactions contemplated hereby and thereby.  The execution, delivery and
performance by it of this Agreement and each of the documents and instruments
required to be entered into by it pursuant to this Agreement, and the
consummation of the transactions contemplated hereby and thereby, have been duly
and validly authorized by all necessary limited liability company action and
such authorization has not been withdrawn or amended in any manner.  

3.3.3

Enforceability.  This Agreement constitutes a legal, valid and binding
obligation of FR54 (assuming that this Agreement has been, and each of the
documents and instruments required to be entered into by FR54 pursuant to this
Agreement will be, duly and validly authorized, executed and delivered by the
other persons party thereto), enforceable against FR54 in accordance with their
respective terms, except that (a) such enforcement may be subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws, now or
hereafter in effect, affecting creditors’ rights generally, and (b) the remedy
of specific performance and injunctive and other forms of equitable relief may
be subject to equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought.

3.3.4

Consents.  No consent, approval or authorization of, or designation, declaration
or filing with, any governmental authority or notice, approval, consent waiver
or authorization from any third party is required on the part of FR54 with
respect to FR54’s execution, delivery or performance of its obligations under
this Agreement or the consummation of the transactions contemplated hereby,
except for any consent, approvals, authorizations, designations, declarations,
waivers or filings, the absence of which would not have a material adverse
effect on FR54.

3.3.5

Ownership. FR54 is the sole record holder and beneficial owner of the FR54
Series C Shares. FR54 owns the FR54 Series C Shares free and clear of all Liens.
There are no outstanding rights, options, warrants, conversion rights,
repurchase rights, agreements, arrangements, calls, commitments or rights of any
kind that obligate FR54 to sell the FR54 Series C Shares or any securities or
obligations convertible or exchangeable into or exercisable for, or giving any
person a right to subscribe for or acquire the FR54 Series C Shares.

3.3.6

Access to Information; Advice. FR54 (either alone or together with its advisors)
has such knowledge and experience in financial or business matters that it is
capable of evaluating the merits and risks of the transactions contemplated
hereby. FR54 has had the opportunity to discuss the transactions contemplated
hereby with the management of the Company and has had the opportunity to obtain
such information pertaining to the Company as has been requested. FR54 has
received all information that it believes is necessary or appropriate in
connection the transactions contemplated hereby. FR54 is an informed and
sophisticated party and

 

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has engaged, to the extent FR54 deems appropriate, expert advisors experienced
in the evaluation of transactions of the type contemplated hereby. FR54
acknowledges that it has not relied upon any express or implied representations
or warranties of any nature made by or on behalf of the Company or CDS, whether
or not any such representations, warranties or statements were made in writing
or orally, except as expressly set forth for the benefit of FR54 in this
Agreement.  FR54 is relying solely upon the advice of its own legal, tax and
financial advisers with respect to the tax and other legal aspects of this
Agreement.

3.3.7Exemption from Registration.  Neither FR54 nor any of its affiliates nor
any person acting on behalf of or for the benefit of any of the forgoing, has
paid or given, or agreed to pay or give, directly or indirectly, any commission
or other remuneration (within the meaning of Section 3(a)(9) of the Securities
Act and the rules and regulations promulgated thereunder) for soliciting the
transactions contemplated hereby.  FR54 also understands that the FR54 Class A
Exchange Shares are being offered and issued pursuant to an exemption from the
registration requirements of the Securities Act, under Section 3(a)(9), Section
4(a)(2) of the Securities Act and/or Regulation D promulgated under the
Securities Act.

 

3.3.8Accredited Investor; No Registration. FR54 represents that it is an
“accredited investor” within the meaning of Rule 501(a) of the Securities Act.
FR54 understands that the FR54 Class A Exchange Shares have not been registered
under the Securities Act or any other applicable securities laws. FR54
understands that the FR54 Class A Exchange Shares may not be offered, sold or
otherwise transferred except in compliance with the registration requirements of
the Securities Act and any other applicable securities laws or pursuant to an
exemption therefrom, and in each case in compliance with the conditions set
forth in this Agreement.

 

 

3.4

Representations and Warranties of the Company

.  The Company represents and warrants to CDS and FR54, subject to the
Disclosure Schedule, as follows:

3.4.1

Organization, Existence and Good Standing.  The Company is a corporation duly
organized, validly existing and in good standing under the Laws of the State of
Delaware.

3.4.2

Foreign Good Standing.  The Company has qualified as a foreign corporation, and
is in good standing, under the laws of all jurisdictions where the nature of its
business or the nature or location of its assets requires such qualification.

3.4.3

Power and Authority.  The Company has all necessary corporate power and
authority to carry on its business as such business is now being conducted.  The
Company has the corporate power and authority to execute, deliver and perform
this Agreement and each of the documents and instruments required to be entered
into by it pursuant to this Agreement, and to consummate the transactions
contemplated hereby and thereby. The execution, delivery and performance by the
Company of this Agreement and each of the documents and instruments required to
be entered into by it pursuant to this Agreement, and the consummation by the
Company of the transactions contemplated hereby and thereby, have been duly and
validly

 

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authorized by all necessary corporate action and such authorization has not been
withdrawn or amended in any manner.  

3.4.4

Enforceability.  This Agreement constitutes a legal, valid and binding
obligation of the Company (assuming that this Agreement has been, and each of
the documents and instruments required to be entered into by the Company
pursuant to this Agreement will be, duly and validly authorized, executed and
delivered by the other persons party thereto), enforceable against the Company
in accordance with their respective terms, except that (a) such enforcement may
be subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws, now or hereafter in effect, affecting creditors’ rights
generally, and (b) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.

3.4.5

Consents. No consent, approval or authorization of, or designation, declaration
or filing with, any governmental authority or notice, approval, consent waiver
or authorization from any third party is required on the part of the Company
with respect to the Company’s execution, delivery or performance of its
obligations under this Agreement or the consummation of the transactions
contemplated hereby, except for any consent, approvals, authorizations,
designations, declarations, waivers or filings, the absence of which would not
have a material adverse effect on the Company taken as a whole.

3.4.6

Projects and Project Entities.  The Projects and Project entities owned by
Investors X and subject to this Agreement are specifically set forth on Schedule
3.4.6 of the Disclosure Schedule.  Except as set forth on Schedule 3.4.6 of the
Disclosure Schedule or as limited by the Investors X Operating Agreement, the
Company owns one hundred percent (100%) of the membership interests of each
Project entity, free and clear of any Liens not otherwise disclosed herein.

 

3.4.7

Capitalization of the Company and Investors X.  

(a)

The authorized capital stock of the Company consists of the following: (i)
59,779,750 shares of Class A common stock, par value $0.01 per share, of which
3,663,843 are issued and outstanding, (ii) 220,250 shares of Class B common
stock, par value $0.01 per share, of which 220,250 are issued and outstanding,
(iii) 20,000,000 shares of  preferred stock, par value $0.01 per share, of which
2,799,848 of the Company’s Series C Non Convertible Preferred Stock are issued
and outstanding. The Company shall reserve for issuance and as of the Closing
will have sufficient authorized Class A Shares and Series C Shares to issue the
Exchange Shares.

(b)The authorized, issued and outstanding ownership interests of Investors X
consists solely of 100 Class A Units and 390 Class B Units with no additional
ownership interests authorized, issued or outstanding.    

3.4.8

Insurance.  The Company currently maintains adequate insurance for its
homebuilding operations (including fire and casualty, general liability, theft,
workers’ compensation, directors and officers, business interruption, and all
other normal forms of insurance) which cover the Projects and/or Project
entities.  All such insurance policies are in full

 

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force and effect, all premiums have been paid thereunder and none of the
coverage provided by such policies will terminate or lapse by reason of any of
the transactions contemplated by this Agreement.       

3.4.9

Permits.  Each of the Projects has or in the ordinary course of business will
have all permits which are required in order for CDS to conduct its homebuilding
or land development business as presently conducted or proposed to be
conducted.  The Company has not received any citation, suspension, revocation,
limitation, warning or similar notice regarding any of its permits.  

3.4.10Litigation and Claims.  Except as set forth on Schedule 3.4.10 of the
Disclosure Schedule, there is no litigation or proceeding, at law or in equity,
and there are no proceedings or governmental investigations before any
governmental or regulatory authority, pending or, to the best of the Company’s
knowledge, overtly threatened against a Project or Project entity.

3.4.11 Environmental Matters.  There is no Environmental Claim pending or, to
the best of the Company’s knowledge, threatened against a Project or a Project
entity.  The Projects (a) are in compliance with all applicable Environmental
Laws and Environmental Permits and (b) possess all Environmental Permits which
are required for the operation of its business and operations. No Real Property
is currently listed on the National Priorities List or the Comprehensive
Environmental Response, Compensation and Liability Information System, both
promulgated under the CERCLA or any comparable state list.  There is not and has
not been any Hazardous Substances used, generated, treated, stored, transported,
disposed of, handled or otherwise existing on, under or about any Real Property
in violation of any Environmental Laws.  There are no underground or
above-ground storage tanks located on any Real Property.  Any and all
underground or above-ground storage tanks previously located at any such Real
Property (and not presently thereat as of the date hereof) were removed in
accordance with all Environmental Laws.

3.4.12Real Property.  Schedule 3.4.12 of the Disclosure Schedule contains a
true, correct and complete list of each Project name, street address (to the
extent one exists) or lot number, and a status showing the percentage of
completion of any home currently under construction on the Real Property owned
by a Project entity.  Each Project entity owns good and marketable title to its
fee simple estates in the Real Property, free and clear of all liens other than
permitted liens related to the Assumed Indebtedness.  

3.4.13 No Default. The Company and its subsidiaries are not, and, immediately
after the consummation of the transactions contemplated hereby, none will be, in
material default of (whether upon the passage of time, the giving of notice or
both) any term of its certificate of incorporation or its bylaws or any
provision of any security issued by the Company.

 

3.4.14  SEC Requirements.  The Company shall file at its expense all of the
forms required to complete or disclose the transactions contemplated by this
Agreement with the Securities and Exchange Commission, provided that CDS shall
provide any necessary information as required by CDS.

 

 

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3.4.15Exemption from Registration.  Neither the Company nor any of its
affiliates nor any person acting on behalf of or for the benefit of any of the
forgoing, has paid or given, or agreed to pay or give, directly or indirectly,
any commission or other remuneration (within the meaning of Section 3(a)(9) of
the Securities Act and the rules and regulations promulgated thereunder) for
soliciting the transactions contemplated hereby.

 

Article IV
CONDITIONS TO CLOSING

 

4.1

Conditions to the Company’s Obligations

.  The obligation of the Company to close the transactions contemplated hereby
is subject to the fulfillment of the following conditions on or prior to the
Closing Date:

4.1.1

The representations and warranties made by CDS and FR54 shall be true, correct
and complete in all material respects.

4.1.2

The Company shall have obtained, on behalf of itself or the Project entities, a
release of all obligations with respect to any Indebtedness related to a Project
lender and an agreement from any such lender for CDS, or its beneficial owners,
to assume the Project Indebtedness.  

4.1.3

The Company shall have obtained, on behalf of itself or the Project entities,
all required consents related to the change of control in its ownership related
to joint venture partners or Project Indebtedness.  4.1.4CDS and FR54 shall have
delivered to the Company or escrow agent all of the documents required by
Sections 5.3 and 5.4.

 

4.2

Conditions to CDS’s Obligations

.  The obligation of CDS to close the transactions contemplated hereby is
subject to the fulfillment of the following conditions on or prior to the
Closing Date:

4.2.1

The representations and warranties made by the Company shall be true, correct
and complete in all material respects.

4.2.2

The Company shall have delivered to CDS or the escrow agent all of the documents
required by Section 5.2.

 

4.3

Conditions to FR54’s Obligations

.  The obligation of FR54 to close the transactions contemplated hereby is
subject to the fulfillment of the following conditions on or prior to the
Closing Date:

4.3.1

The representations and warranties made by the Company shall be true, correct
and complete in all material respects.

4.3.2

The Company shall have delivered to FR54 or the escrow agent all of the
documents required by Section 5.2.

 

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Article V
CLOSING and DEFAULT

 

5.1

Delivery of Documents

.  At the Closing, the parties shall deliver the documents, and shall perform
the acts, which are set forth in this ARTICLE V.  

 

5.2

Company’s Deliveries at Closing

.  The Company shall execute and/or deliver to Escrow Agent, CDS and /or FR54
all of the following:

5.2.1a stock certificate evidencing the FR54 Class A Exchange Shares, registered
in the name of FR54 to FR54;

5.2.2a stock certificate evidencing the CDS Class A Exchange Shares, registered
in the name of CDS to CDS;

5.2.3a stock certificate evidencing the CDS Series C Exchange Shares, registered
in the name of CDS to CDS;

5.2.4certificate evidencing the Class A Membership Interest together with an
executed assignment of membership interest for the Class A Membership Interest
to CDS;

5.2.5

a closing certificate executed by an executive officer of the Company, pursuant
to which Company certifies to CDS and FR54 that: (a) the Company’s
representations and warranties are true, correct and complete as of the Closing
Date; and (b) all covenants required by the terms hereof to be performed by the
Company on or before the Closing Date, to the extent not waived by CDS or FR54,
have been so performed;

5.2.6  all documents to be executed and delivered by the Company or actions to
be taken by the Company pursuant to this Agreement, including without
limitation, all agreements required to be executed and delivered by the Company
or actions to be taken by the Company pursuant to Section 2.3;

5.2.7

copies of all of required consents required by Section 4.1.3; and

5.2.8

without limitation by specific enumeration of the foregoing, all other documents
reasonably required from the Company to consummate the transactions contemplated
hereby shall be timely delivered.

 

5.3

CDS’s Deliveries at Closing

.  CDS shall execute and/or deliver to the Company all of the following:

5.3.1certificate evidencing the Class B Membership Interests together with an
executed assignment of membership interest for the Class B Membership Interests;

 

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5.3.2

a closing certificate executed by an executive officer of CDS, pursuant to which
CDS certifies that: (a) its representations and warranties are true, correct and
complete as of the Closing Date; and (b) all covenants required by the terms
hereof to be performed by CDS on or before the Closing Date, to the extent not
waived by the Company or FR54, have been so performed;

5.3.3  all documents to be executed and delivered or actions to be taken by CDS
pursuant to this Agreement, including without limitation, all agreements
required to be executed and delivered by CDS or actions to be taken by CDS
pursuant to Section 2.3; and

5.3.4

without limitation by specific enumeration of the foregoing, all other documents
reasonably required from CDS to consummate the transactions contemplated hereby
shall be timely delivered.

 

5.4

FR54’s Deliveries at Closing

.  FR54 shall execute and/or deliver to the Company all of the following:

5.4.1certificate evidencing the FR54 Series C Shares, together with stock power
authorizing the officers of the Company to effect the transfer of the FR54
Series C Shares to the Company;

5.4.2

a closing certificate executed by an executive officer of FR54, pursuant to
which FR54 certifies that: (a) its representations and warranties are true,
correct and complete as of the Closing Date; and (b) all covenants required by
the terms hereof to be performed by FR54 on or before the Closing Date, to the
extent not waived by the Company or CDS, have been so performed;

5.4.3  all documents to be executed and delivered by FR54 pursuant to this
Agreement; and

5.4.4

without limitation by specific enumeration of the foregoing, all other documents
reasonably required from FR54 to consummate the transactions contemplated hereby
shall be timely delivered.

Article VI
POST‑CLOSING AGREEMENTS

6.1Contracts.  Material contracts for the Projects are typically maintained by
Comstock Homes of Washington, L.C. (“CHOW”), a wholly owned subsidiary of the
Company (including all amendments thereto), including all material agreements
with (a) suppliers or vendors; (b) subcontractors, including affiliates or
subsidiaries of the Company; (c) developers and homebuilders; and (d) any
governmental or regulatory authority (the “Project Contracts”).  The Company
hereby agrees to take all action to cause CHOW to maintain for the benefit of
CDS all of the Project Contracts after the Closing.

6.2Third Party Claims

 

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.  The parties hereto shall cooperate with each other with respect to the
defense of any third party claims subsequent to the Closing Date which are not
subject to the indemnification provisions contained in ARTICLE VIII, provided
that the party requesting cooperation shall reimburse the other party for the
other party’s reasonable out-of-pocket costs and expenses of furnishing such
cooperation.

6.3Further Assurances

.  The parties shall execute such further documents, and perform such further
acts, as may be necessary to comply with the terms of this Agreement and
consummate the transactions contemplated hereby.

Article VII
termination

7.1Termination

.  This Agreement may be terminated and the transactions contemplated by this
Agreement may be abandoned at any time prior to the Closing:

7.1.1by mutual written consent of the Company, CDS and FR54;

7.1.2by either the Company, CDS and FR54 in writing, if the Closing has not
occurred on or before May 30, 2019, unless the failure of the Closing to occur
is the result of a breach of this Agreement by the party seeking to terminate
this Agreement;

7.1.3by either the Company, CDS or FR54 (but only so long as such party, as
applicable, is not in material breach of its obligations under this Agreement)
in writing, if a material breach of any provision of this Agreement that has
been committed by the other party or parties would cause the failure of any
condition to Closing for the benefit of the non-breaching party and such breach
is not subsequently waived by the non-breaching party or capable of being cured
or is not cured within 10 business days after the breaching party receives
written notice from the non-breaching party that the non-breaching party intends
to terminate this Agreement pursuant to this Section 7.1.3; or

7.1.4by either the Company, CDS or FR54 in writing, if there shall be any order,
injunction or decree of any governmental authority which prohibits or restrains
the parties from consummating the transactions contemplated hereby, and such
order, injunction or decree shall have become final and non-appealable; provided
that prior to termination under this Section 7.1.4, the party seeking to
terminate this Agreement shall have used best efforts to have such order,
injunction or decree vacated.

Article VIII
INDEMNIFICATION

8.1Indemnification Obligations

 

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.  The parties hereto shall jointly but not severally indemnify, save and hold
each other harmless against and from any and all costs, expenses, losses,
damages, claims and liabilities sustained or incurred by the other party, as a
result of, or arising out of or by virtue of:

8.1.1

any inaccuracy in or breach of any representation and warranty made by a party
to the other parties herein or in any certificate or closing document delivered
in connection herewith; and

8.1.2

the breach by a party or a failure by a party to comply with, any of the
covenants or obligations set forth in this Agreement to be performed by the
other party (including their obligations under this ARTICLE VIII);

8.2Additional Indemnification Obligations

.  The Company shall indemnify, save and hold CDS harmless against and from any
and all costs, expenses, losses, damages, claims and liabilities sustained or
incurred by CDS, as a result of, or arising out of or by virtue of: (i) any
taxes and assessments which are unpaid as of the Closing Date and which are not
foreseeable as having arisen from the Company’s ordinary homebuilding
activities; (ii) any Environmental Claims related to Hazardous Substances,
including costs of cleanup, containment or other remediation or any other
alleged violations of Environmental Laws, with respect to any of the Projects;
and (iii) the matters set forth on Schedule 3.4.10.

8.3Procedures for Indemnification.  A party entitled to entitled to indemnity
under Section 8.1 or Section 8.2 (an “Indemnified Party”) shall provide notice
with respect to any matter that such Indemnified Party has determined has given
or could give rise to a right of indemnification under this Agreement to the
party which is or may be required pursuant to this Article VIII or to make such
indemnification (the “Indemnifying Party”), within 30 days of such
determination, stating the amount of the indemnifiable loss claimed, if known,
and method of computation thereof, and referring to the provisions of this
Agreement in respect of which such right of indemnification is claimed by such
Indemnitee or arises; provided that the failure to timely notify the
Indemnifying Party will not relieve the Indemnifying Party of any liability that
it may have to any Indemnified Party, except to the extent that the Indemnifying
Party demonstrates that the defense of such Third-Party Claim is materially
prejudiced by the Indemnified Party’s failure to give such notice. Each such
Indemnified Party shall provide the applicable Indemnifying Party with
reasonable access, upon reasonable prior written notice and during normal
business hours, in a manner so as not to unreasonably interfere in any material
respect with the normal business operations of such Indemnified Party to its
books and records, properties and personnel relating to the claim the
Indemnified Party has determined has given or could give rise to a right of
indemnification under this Agreement.

8.4Third-Party Claims.

(a)Promptly after receipt by an Indemnified Party of notice of the assertion by
a third party of a claim against it (a “Third-Party Claim”), such Indemnified
Party shall give notice to the Indemnifying Party of the assertion of such
Third-Party Claim, provided that the failure to notify the Indemnifying Party
will not relieve the Indemnifying Party of any liability that it may have to any
Indemnified Party, except to the extent that the Indemnifying Party demonstrates
that

 

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the defense of such Third-Party Claim is materially prejudiced by the
Indemnified Party’s failure to give such notice.

(b)If an Indemnified Party gives notice to the Indemnifying Party pursuant to
Section 8.4(a) of the assertion of a Third-Party Claim, the Indemnifying Party
shall be entitled to participate in the defense of such Third-Party Claim and,
to the extent that it wishes (unless (i) the Indemnifying Party is also a person
against whom the Third-Party Claim is made and the Indemnified Party determines
in good faith that joint representation would be inappropriate or (ii) the
Indemnifying Party fails to provide reasonable assurance to the Indemnified
Party of its financial capacity to defend such Third-Party Claim), elect to
assume the defense of such Third-Party Claim within 30 days of receiving notice
of such claim, with counsel reasonably satisfactory to the Indemnified Party.
After notice from the Indemnifying Party to the Indemnified Party of its
election to assume the defense of such Third-Party Claim, the Indemnifying
Person shall not, so long as it diligently conducts such defense, be liable to
the Indemnified Party under this Article VIII for any fees of other counsel or
any other expenses with respect to the defense of such Third-Party Claim, in
each case subsequently incurred by the Indemnified Party in connection with the
defense of such Third-Party Claim, other than reasonable costs of investigation.
If the Indemnifying Party assumes the defense of a Third-Party Claim, (i) such
assumption will conclusively establish for purposes of this Agreement that the
claims made in such Third-Party Claim are within the scope of and subject to
indemnification, and (ii) no compromise or settlement of such Third-Party Claim
may be effected by the Indemnifying Party without the Indemnified Party’s prior
written consent unless (A) there is no finding or admission of any wrongdoing or
violation of applicable law or any violation of the rights of any person, (B)
the sole relief provided is monetary damages that are paid in full by the
Indemnifying Party, and (C) such compromise or settlement shall include as an
unconditional term thereof the giving by the claimant of a full and
unconditional release of each Indemnified Party from all liability with respect
to such Third-Party Claim reasonably acceptable to such Indemnified Party. The
Indemnified Party shall cooperate with the Indemnifying Party in such defense
and make available to the Indemnifying Party all witnesses, experts, pertinent
Information, personnel, materials and information in such Indemnified Party’s
possession or under such Indemnified Party’s control relating thereto as are
reasonably required by the Indemnifying Party. If notice is given to an
Indemnifying Party of the assertion of any Third-Party Claim and the
Indemnifying Party does not, within 30 days after the Indemnified Party’s notice
is given, give notice to the Indemnified Party of its election to assume the
defense of such Third-Party Claim, the Indemnifying Party will be bound by any
determination made in such Third-Party Claim, but will not be bound by any
compromise or settlement effected without its consent (which consent may not be
unreasonably withheld, conditioned or delayed).

(c)Notwithstanding the foregoing, if an Indemnified Party determines in good
faith that (i) there is a reasonable probability that a Third-Party Claim is a
criminal proceeding, action, indictment, allegation or investigation or seeks an
injunction or equitable relief against the Indemnified Party or otherwise may
adversely affect it or its related parties, other than as a result of monetary
damages for which it would be entitled to indemnification in full under this
Agreement, or (ii) concludes in good faith that the Indemnifying Party failed or
is failing to vigorously prosecute or defend such Third-Party Claim, the
Indemnified Party may, by notice to the Indemnifying Party, assume the exclusive
right to defend, compromise or settle such Third-Party Claim, whereupon the
Indemnifying Party will be bound by any determination made in such

 

--------------------------------------------------------------------------------

 

Third-Party Claim, but will not be bound by any compromise or settlement
effected without its consent (which consent may not be unreasonably withheld,
conditioned or delayed).

(d)With respect to any Third-Party Claim subject to indemnification under this
Article VIII: (i) both the Indemnified Person and the Indemnifying Party, as the
case may be, shall keep the other party fully informed of the status of such
Third-Party Claim and any related proceedings at all stages thereof where such
party is not represented by its own counsel, and (ii) the parties agree (each at
its own expense) to render to each other such assistance as they may reasonably
require of each other and to cooperate in good faith with each other in order to
ensure the proper and adequate defense of any Third-Party Claim.

(e)With respect to any Third-Party Claim subject to indemnification under this
Article VIII, the parties agree to cooperate in such a manner as to preserve in
full (to the extent possible) the confidentiality of all confidential
information and the attorney-client and work-product privileges. In connection
therewith, each party agrees that: (i) it will use its reasonable efforts, in
respect of any Third-Party Claim in which it has assumed or participated in the
defense, to avoid production of confidential information (consistent with
applicable law and rules of procedure), and (ii) all communications between any
party hereto and counsel responsible for or participating in the defense of any
Third-Party Claim shall, to the extent possible, be made so as to preserve any
applicable attorney-client or work-product privilege.

Article IX  

RESTRICTIONS ON SERIES C SHARES

 

9.1 The following transfer restrictions are applicable to the Series C Shares:  

 

(a)Transfer Restriction.  The Series C Shares may not be transferred without the
consent of the Company.

 

(b)Transfer of Series C Shares. CDS acknowledge that the Series C Shares are
restricted securities and may be transferred only pursuant to: (i) an effective
registration statement under the Securities and Exchange Act and applicable
state securities laws pertaining to such securities or an available exemption
therefrom; and (ii) Rule 144 of the Securities and Exchange Commission (or any
similar rule or rules then in force) if such rule or rules are available.

 

(c)Restrictive Legend. CDS acknowledges and agrees that, upon issuance pursuant
to this Agreement, the certificates representing the Series C Shares shall have
endorsed thereon a legend in substantially the following form:

 

“THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”) OR THE SECURITIES LAWS OF ANY STATE, AND ARE
BEING OFFERED AND SOLD PURSUANT TO AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND SUCH LAWS. THESE SECURITIES MAY NOT BE
SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE

 

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EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR SUCH OTHER
LAWS.”

 

Article X

MISCELLANEOUS PROVISIONS

 

10.1Notices

.  All notices required or permitted to be given hereunder shall be in writing
and may be delivered by hand, electronic mail, by nationally recognized private
courier, or by United States mail.  Notices delivered by mail shall be deemed
given three business days after being deposited in the United States mail,
postage prepaid, registered or certified mail, return receipt
requested.  Notices delivered by hand, by electronic mail, or by nationally
recognized private courier shall be deemed given on the first business day
following receipt.  All notices shall be addressed as follows:

If to the Company:

Comstock Holding Companies, Inc.

1886 Metro Center Drive

4th Floor

Reston, Virginia 20190

Attention: Chief Financial Officer

e-mail: cguthire@comstockcompanies.com

with a copy to:

Comstock Holding Companies, Inc.

1886 Metro Center Drive

4th Floor

Reston, Virginia 20190

Attention: General Counsel

e-mail: jthompson@comstockcompanies.com

If to CDS or FR54:

Comstock Development Services, LC

FR54, LC

1886 Metro Center Drive

4th Floor

Reston, Virginia 20190

Attention: Managing Member

e-mail: cclemente@comstockcompanies.com

 

and/or to such other respective addresses and/or addressees as may be designated
by notice given in accordance with this Agreement.

 

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10.2Entire Agreement

.  This Agreement, together with the instruments and other documents to be
delivered by the parties pursuant to the provisions hereof constitute the entire
agreement between the parties and shall be binding upon and inure to the benefit
of the parties hereto and their respective legal representatives, successors and
permitted assigns.  Each preamble, recital, exhibit, schedule, including the
Disclosure Schedule, shall be considered incorporated into this Agreement.    

10.3Non-Waiver

.  The failure in any one or more instances of a party to insist upon
performance of any of the terms, covenants or conditions of this Agreement, to
exercise any right or privilege in this Agreement conferred, or the waiver by
said party of any breach of any of the terms, covenants or conditions of this
Agreement, shall not be construed as a subsequent waiver of any such terms,
covenants, conditions, rights or privileges, but the same shall continue and
remain in full force and effect as if no such forbearance or waiver had
occurred.  No waiver shall be effective unless it is in writing and signed by an
authorized representative of the waiving party.

10.4Counterparts

.  This Agreement may be executed in multiple counterparts and by facsimile,
each of which shall be deemed to be an original, and all such counterparts shall
constitute but one instrument.

10.5Severability

.  Whenever possible, each provision of this Agreement shall be interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable Law or rule in any jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
or any other jurisdiction, and, for purposes of such jurisdiction, such
provision or portion thereof shall be struck from the remainder of this
Agreement, which shall remain in full force and effect.  This Agreement shall be
reformed, construed and enforced in such jurisdiction so as to best give effect
to the intent of the parties under this Agreement.

10.6Applicable Law

.  This Agreement shall be governed and controlled as to validity, enforcement,
interpretation, construction, effect and in all other respects by the internal
Laws of the Commonwealth of Virginia applicable to contracts made in that state,
without giving effect to any choice of law or conflict of law provision or rule
that would cause the application of the Laws of any jurisdiction other than the
Commonwealth of Virginia.

10.7Binding Effect; Benefit

.  This Agreement shall inure to the benefit of and be binding upon the parties
hereto, and their successors and permitted assigns.  Nothing in this Agreement,
express or implied, shall confer on any person other than the parties hereto,
and their respective successors and permitted assigns,

 

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any rights, remedies, obligations or liabilities under or by reason of this
Agreement, including third party beneficiary rights.

10.8Assignability

.  The Company, FR54, or CDS may assign its rights under this Agreement to an
affiliate or a wholly-owned subsidiary without the permission of any other party
to this Agreement.

10.9Rule of Construction

.  The parties acknowledge and agree that each has negotiated and reviewed the
terms of this Agreement, assisted by such legal counsel as they desired, and has
contributed to its revisions.  The parties further agree that the rule of
construction that any ambiguities are resolved against the drafting party will
be subordinated to the principle that the terms and provisions of this Agreement
will be construed fairly as to all parties and not in favor of or against any
party.

10.10Waiver of Trial by Jury

.  EACH OF THE PARTIES HERETO WAIVES THE RIGHT TO A JURY TRIAL IN CONNECTION
WITH ANY LAWSUIT, ACTION OR PROCEEDING SEEKING ENFORCEMENT OF SUCH PARTY’S
RIGHTS UNDER THIS AGREEMENT.

10.11Consent to Jurisdiction

.  This Agreement has been executed and delivered in and shall be deemed to have
been made in the Commonwealth of Virginia.  The parties hereto each agree to the
exclusive jurisdiction of the Circuit Court of Fairfax County, Virginia, with
respect to any claim or cause of action arising under or relating to this
Agreement, and waives personal service of any and all process upon it, and
consents that all services of process be made by registered or certified mail,
return receipt requested, directed to it at its address as set forth in Section
10.1, and service so made shall be deemed to be completed when received.  The
parties hereto each waive any objection based on forum non conveniens and waive
any objection to venue of any action instituted hereunder.  Nothing in this
Section shall affect the right of any party to serve legal process in any other
manner permitted by Law.

10.12Amendments

.  This Agreement shall not be modified or amended except pursuant to an
instrument in writing executed and delivered on behalf of each of the parties
hereto.

10.13Headings

.  The headings contained in this Agreement are for convenience of reference
only and shall not affect the meaning or interpretation of this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement on the date first
above written.

 

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COMPANY:

COMSTOCK HOLDING COMPANIES, INC.

By: _____________________________________

Name:  Christopher Guthrie

Title:Chief Financial Officer

 

CDS:

Comstock Development Services, LC

  

By: _____________________________________

Name:   Christopher D. Clemente

Title:  Managing Member

 

FR54:

FR54, LC

By: _____________________________________

Name:   Christopher D. Clemente

Title:  Managing Member

 

 

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DISCLOSURE SCHEDULE

 

Schedule 2.2Company Shares and CDS Shares

Schedule 2.3(a)Assumed Indebtedness

Schedule 2.3(b)Assumed Bond Liabilities

Schedule 3.4.6Projects and Project L.C.s

Schedule 3.4.10Litigation and Claims

Schedule 3.4.12Real Property

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Schedule 2.2

 

Consideration Type

Delivered to CDS Pursuant to Article II

Delivered to FR54 Pursuant to Article II

Delivered to the Company Pursuant to Article II

 

Class A Shares

 

3,100,000

 

723,750

 

 

Series C Shares

 

1,220,000

 

 

589,800

 

Class A Membership Interest

 

100.00

 

 

 

 

Class B Membership Interest

 

 

 

390.00

 

 

 

 

 

 

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