PROMISSORY
NOTE

    


    
      
        	
                $1,000,000.00

              	
                October
      12, 2010

              
	 
      	
                Atlanta,
      Georgia

              


      

    

    


    FOR VALUE
RECEIVED, Preferred Apartment Communities, Inc. ("PAC") promises to pay to the
order of Williams Opportunity Fund, LLC or its assigns ("Holder") up to the
aggregate principal sum of ONE MILLION DOLLARS ($1,000,000.00), or such sum as
may be advanced and outstanding from time to time, in legal tender of the United
States, with interest on the unpaid principal balance outstanding at the rate of
4.25% per annum (which is the current prime rate plus 1%), until paid in
full.  The entire principal balance of this Promissory Note (this
"Note"), together with all accrued and unpaid interest thereon shall be due and
payable to Holder at One Overton Park, 3625 Cumberland Blvd, Suite 400, Atlanta,
GA 30339 or at such other place as Holder may designate in writing, on December
31, 2010 (the "Maturity Date").  In the event this Note is not paid
with ten (10) days following the Maturity Date, interest on the then outstanding
principal amount of this Note shall thereafter accrue at the rate of ten percent
(10%) per annum until this Note is paid in full. TIME SHALL BE OF THE ESSENCE OF
THIS NOTE.  PAC acknowledges and agrees that this Note contains the
entire agreement between PAC and Holder regarding the indebtedness evidenced
hereby and that there are no prior or contemporaneous agreements between PAC or
any of its members and Holder limiting or affecting Holder’s right to demand
payment under this Note at any time.

     

    Should
this Note, or any part of the indebtedness evidenced hereby, be collected by law
or through an attorney-at-law, PAC agrees to pay, and the Holder shall be
entitled to collect, reasonable attorney's fees actually incurred, and all costs
of collection, whether or not suit be brought.

     

    PAC and
Holder acknowledge and agree that the proceeds to be borrowed under this Note
may be borrowed in multiple draws from time to time after the date hereof and
shall be disbursed within two (2) business days after written request from PAC
to Holder requesting disbursement under this Note.  Interest shall not
accrue on proceeds disbursed under this Note until such time as such proceeds
are actually advanced from Holder to PAC.

     

    This Note
may be prepaid at any time, and from time to time, in whole or in part, without
premium or penalty, but with interest thereon through the date of
prepayment.  Any payments on this Note shall first be applied to any
costs and fees (including reasonable attorneys’ fees) actually incurred in
connection with the collection of this Note, then to accrued but unpaid
interest, and then to outstanding principal.  Notwithstanding the
foregoing, PAC may not reborrow any amounts prepaid under this
Note.

     

    Presentment
for payment, demand, protest and notice of demand, protest and nonpayment and
all other notices are hereby waived by the undersigned, who hereby further
waives and renounces, to the fullest extent permitted by law, all rights to the
benefits of any statute of limitations, moratorium, reinstatement, marshalling,
forbearance, valuation, stay, extension, redemption, appraisement, exemption and
homestead now or hereafter provided by the Constitution and laws of the United
States of America and of each state thereof, both as to itself and in and to all
of its property, real and personal, against the enforcement and collection of
the obligations evidenced by this Note.  This Note may not be changed
orally, but only by an agreement in writing signed by Holder.

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    From time
to time, without affecting the obligation of PAC to pay the outstanding
principal balance of this Note and to observe the covenants of PAC contained
herein, and without liability on the part of the Holder, Holder may, at the
option of Holder and with or without the consent of PAC, extend the time for
payment of said outstanding principal balance and interest accrued thereon, or
any part thereof, reduce the payments thereon, release anyone liable on any of
said outstanding principal balance, accept a renewal of this Note, modify the
terms and time of payment of said outstanding principal balance and interest
accrued thereon or join in any extension or subordination agreement, and agree
in writing with PAC to modify the rate of interest or period of amortization of
this Note or change the amount payable hereunder.  No one or more of
such actions shall constitute a novation.

     

    If from
any circumstances whatsoever fulfillment of any provision of this Note, at the
time performance of such provision shall be due, shall involve transcending the
limit of validity presently prescribed by any applicable usury statute or any
other applicable law, with regard to obligations of like character and amount,
then ipso facto
the obligation to be fulfilled shall be reduced to the limit of such validity,
so that in no way shall any exaction be possible under this Note that is in
excess of the current limit of validity, but such obligation shall be fulfilled
to the limit of validity.  Any payments charged to PAC or collected by
Holder that would constitute interest in excess of any applicable legal limit
shall be applied by Holder to the reduction of the unpaid principal amount due
hereunder or, if said principal amount is fully paid, returned to
PAC.

     

    Notices
and other communications pertaining to this Note shall be in writing and shall
be deemed effectively given if delivered in person (including delivery by
commercial courier service) or mailed U.S. certified mail, return receipt
requested, postage prepaid, to PAC or Holder at the addresses listed
below:

     

    
      
        	
                if
      to PAC:

              	
                Preferred
      Apartment Communities, Inc.

              
	 
      	
                3625
      Cumberland Boulevard, Suite 400

              
	 
      	
                Atlanta,
      Georgia 30339

              
	 
      	
                Attention:
      Michael J. Cronin, Chief Accounting Officer

              
	 
      	 
      
	
                if
      to Holder:

              	
                Williams
      Opportunity Fund, LLC

              
	 
      	
                3625
      Cumberland Boulevard, Suite 400

              
	 
      	
                Atlanta,
      Georgia 30339

              
	 
      	
                Attention:
      Leonard A. Silverstein, General
Counsel

              


      

    

     

    PAC
hereby warrants, represents and covenants that no funds disbursed hereunder
shall be used for personal, family or household purposes.

     

    PAC is
and shall be obligated to pay principal, interest and any and all other amounts
which become payable hereunder absolutely and unconditionally and without any
abatement, postponement, diminution or deduction and without any reduction for
counterclaim or setoff.

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    This Note
and the rights and obligations of the parties hereunder shall be construed and
interpreted in accordance with the laws of the State of Georgia (excluding the
laws applicable to conflicts or choice of law).  PAC hereby submits to
personal jurisdiction and venue in the Superior Court of Cobb County, Georgia
and waives any and all rights under Georgia law to object to jurisdiction and
venue in the Superior Court of Cobb County, Georgia for the purposes of any
action, suit, proceeding or litigation to enforce such obligations of
PAC.

     

    IN
WITNESS WHEREOF, the undersigned has executed this Note under seal as of the
date first above written.

     

    
      
        
          
            
              
                	
                        Preferred
      Apartment Communities, Inc.

                      
	 
      	 
      	 
      
	
                        By:

                      	
                        /s/ John A. Williams

                      	
                        (Seal)

                      
	 
      	
                         John
      A. Williams

                      	 
      
	 
      	
                         Chief
      Executive Officer