TASK DEFINITION: In this task, you're given a passage that represents a legal contract or clause between multiple parties, followed by a question that needs to be answered. Based on the paragraph, you must write unambiguous answers to the questions and your answer must refer a specific phrase from the paragraph. If multiple answers seem to exist, write the answer that is the most plausible.
PROBLEM: Exhibit 10.33   Last Updated: April 6, 2007     CHASE AFFILIATE AGREEMENT   THIS AGREEMENT sets forth the terms and conditions agreed to between Chase Bank USA, N.A. (?Chase?) and you as an Affiliate in the Chase Affiliate Program (the Affiliate Program). Once accepted into the Affiliate Program, an Affiliate can establish links from the Affiliate's Website to [Chase.com]. Chase will pay Affiliate a fee for each approved credit card account that originates from a link in Affiliate's Website.   THIS IS A LEGAL AND CONTRACTUALLY BINDING AGREEMENT BETWEEN AFFILIATE AND CHASE. TO APPLY TO THE AFFILIATE PROGRAM, YOU MUST COMPLETE AND SUBMIT THE AFFILIATE REGISTRATION FORM AND CLICK ON THE AGREE BUTTON BELOW TO INDICATE YOUR WILLINGNESS TO BE BOUND TO CHASE BY THIS AGREEMENT. THIS AGREEMENT WILL TAKE EFFECT IF AND WHEN CHASE REVIEWS AND ACCEPTS YOUR REGISTRATION FORM AND PROVIDES YOU NOTICE OF ACCEPTANCE. BY SUBMITTING YOUR REGISTRATION FORM, AFFILIATE CERTIFIES THAT YOU HAVE READ AND UNDERSTAND THE TERMS SET FORTH BELOW, AND THAT YOU ARE AUTHORIZED TO SUBMIT THIS REGISTRATION FORM BY THE NAMED AFFILIATE.   In connection with your participation in the Affiliate Program, Affiliate and Chase agree as follows:   1. Enrollment in the Affiliate Program; Restricted Content   To enroll in the Affiliate Program, you must submit a complete Affiliate Registration Form via the Chase Affiliate Website:   For new affiliates: https://ssl.linksynergy.com/php-bin/reg/sregister.shtml?mid=2291   For existing affiliates: http://www.linkshare.com/joinprograms?oid=87909   Chase will evaluate your registration form and will notify you via e-mail of the acceptance or rejection of your registration form. Chase reserves, in its sole discretion, with or without reason, the right to accept or reject your registration into the Chase Affiliate Program, including but not limited to a determination that your site is unsuitable for or incompatible with the Affiliate Program based on the following criteria (collectively Restricted Content):   • Incorporates images or content that is any way unlawful, offensive, profane, harmful, threatening, defamatory, obscene, harassing or racially, ethically or otherwise objectionable   • Promote illegal activities, including gambling   • Promotes or depicts sexually explicit, obscene or pornographic images   • Promotes or depicts violence or hate speech   • Promotes discrimination based on race, sex, religion, nationality, disability, sexual orientation or age

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007





  • Incorporates any materials which infringe or assist others to infringe on any copyright, trademark or other intellectual property rights   • Contains or promotes politically sensitive or controversial issues   Chase also reserves the right to terminate this Agreement in the event that any Restricted Content is incorporated on Affiliate's site after acceptance of your registration form and the commencement of the term of this Agreement. Chase may also terminate this Agreement if your site is deemed unsuitable based on the criteria below:   • Manipulates key word searches on portals   • Misrepresents itself as a Chase Website by altering the visual look and feel of or text from Chase's site, and/or engage in framing the Chase Website   • Engages in domain squatting   • Engages in spamming or unsolicited commercial e-mail   • Engages in unauthorized telemarketing or remarketing of Chase Credit Card offers via telephone   • Uses Chase products and services in the domain name, URL or URI, including, but not limited to, any combination of the following words:   • JP • MORGAN • CHASE • MANHATTAN • AARP • AMAZON.COM • BALL STATE UNIVERSITY • BORDERS • BRITISH AIRWAYS • CASH PLUS • CHASE FREEDOM • CENTRAL MICHIGAN UNIVERSITY • CONTINENTAL • CORNELL UNIVERSITY • DISNEY • DUKE UNIVERSITY • FLEXIBLE REWARDS • FREE CASH • HARVARD COOP • HESS • HOME IMPROVEMENT • LEHIGH UNIVERSITY • LOUISIANA STATE UNIVERSITY • MARATHON • MARRIOTT • MIAMI UNIVERSITY • OHIO UNIVERSITY • OVERSTOCK • PERFECT CARD • PRIORITY CLUB / HOLIDAY INN • SONY • SOUTHERN ILLINOIS UNIVERSITY • SPEEDWAY SUPER AMERICA

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007





  • STARBUCKS • SUBARU • TEMPLE UNIVERSITY • TOYS R US • TRAVEL PLUS • TRUMP • ULTIMATE REWARDS • UNITED • UNIVERSAL • UNIVERSITY OF ARIZONA ATHLETICS • UNIVERSITY OF CHICAGO • UNIVERSITY OF FLORIDA • UNIVERSITY OF HOUSTON • UNIVERSITY OF IDAHO • UNIVERSITY OF KENTUCKY • UNIVERSITY OF MARYLAND • UNIVERSITY OF MEMPHIS • UNIVERSITY OF MINNESOTA ATHLETICS • UNIVERSITY OF NOTRE DAME • UNIVERSITY OF OKLAHOMA • UNIVERSITY OF OREGON • UNIVERSITY OF SOUTH CAROLINA • UNIVERSITY OF TENNESSEE • UNIVERSITY OF VIRGINIA • UTAH STATE UNIVERSITY • VALUE MILES • VIRGINIA TECH APPROVED ACCOUNT • VOLKSWAGEN • WESTERN ILLINOIS UNIVERSITY • YALE UNIVERSTIY   • Uses a proxy server or redirector server to proxy Chase web pages or web sites through your website, URL or URI • Otherwise violates intellectual property rights, including, without limitation, scraping text or images from Chase's Website • Does not clearly state an online privacy policy to its visitors • Is based outside of the United States • Is otherwise considered offensive or inappropriate, at Chase's discretion   2. Affiliate Responsibilities:   • Affiliate cannot use or implement creative that is not available through the LinkShare affiliate interface. • Affiliates may not harvest or collect personal information, or email addresses using the Chase brand without the written consent of Chase • If Affiliate manages a sub-affiliate network, upon Chase's request, Affiliate shall promptly provide Chase with a current, written list identifying the sub-affiliates or other third parties associated. • Chase reserves the right to review and approve all sub-affiliate partners. • Chase shall only use the list for the sole purpose of administering the program and monitoring proper usage, and will not poach or contact subaffiliates directly. • Affiliates will not use the following product keyword search terms. (See Appendix)

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007





  • If Affiliate manages a sub-affiliate network, the Affiliate may not pay sub-affiliates or other partners higher referral fees than the lowest tier of the public offer ($55.00). • Affiliate is prohibited from (a) installing spyware on another person's computer, (b) causing spyware to be installed on another person's computer, or (c) using a context based triggering mechanism to display an advertisement that partially or wholly covers or obscures paid advertising or other content on an Internet website in a way that interferes with a user's ability to view the Internet website.   3. Referral Fee   For each Approved Account (as defined in section 4 below) received through Affiliate's site, Affiliate will earn a referral fee calculated in accordance with the schedule set forth below (Commission) paid monthly.   • Tiered or flat commission based on private offer terms in the network.   Chase reserves the right to alter above referral fees from time to time upon written notice to Affiliate of such change.   4. Approved Account   For purposes of determining Affiliate's Commission, an Approved Account means any Chase credit card application that is: (i) submitted by any user who clicks on an e-mail, banner or any other advertising material from Affiliate's Website; (ii) is approved by Chase; and (iii) is reported as approved by Chase to Affiliate.   5.Term of this Agreement   The term of this Agreement will commence on the date that the Affiliate Registration Form is approved by Chase and will end when terminated by either party. Either Affiliate or Chase may terminate this Agreement at any time, with or without cause, by giving the other party written or e-mail notice of termination. At the time of termination, any links to Chase's Website must be removed immediately. Affiliate will continue to receive Commission payments for all Approved Accounts placed during the term of this Agreement. Notwithstanding the foregoing, Chase may   terminate this Agreement if Affiliate does not comply with the terms and conditions herein.   6. Links   Affiliate agrees to place Chase's links provided by Linkshare NetworkTM which manages the Affiliate Program (Links) on its Affiliate's website. Affiliate is responsible for obtaining prior written approval from the Chase Affiliate manager or Linkshare Network to link any or all other sites owned or managed by the Affiliate, other than the site that was approved at the time of original registration. Affiliate may select or remove Links, at any time without prior approval from Chase. Affiliate is also responsible for removing and/or informing Chase of potential inactive or misdirected Links. Affiliate agrees to cooperate with Chase in establishing and maintaining Links.

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007





  7. Order Processing   Chase will be solely responsible for processing each order placed by a customer from Affiliate's Links. Customers may only use the Chase on-line application process to apply for a Chase credit card. Customers are defined herein as individuals who apply for Chase credit cards through a link in Affiliate's Web site. Chase shall be responsible for administering application forms and related customer service. All of the rules, operating procedures and policies of Chase regarding customer orders and accounts will apply to orders received through the Links. Chase reserves the right to reject any credit card application in its sole discretion.   8. Tracking of Sales   Chase will be solely responsible for tracking Approved Accounts made to customers who follow Affiliate's Links. Affiliate will be solely responsible for ensuring that the Links are formatted properly and maintained in a manner, which allows Chase to track such Approved Accounts. No Commission shall be paid if the Approved Account cannot be tracked by Chase's system or if the customer accesses the Chase site through means other than the Links. Chase will provide Affiliate with statements of Approved Account activity at the time Commissions are paid.   9. Terms and Conditions of Credit Cards   Chase is solely responsible for determining the terms and conditions of the credit cards. The credit card offers may vary from time to time and are subject to change. Affiliate may not specify details regarding the Chase credit card on their Websites without the prior approval of Chase.   10. Chase Customers   Customers who apply for Chase credit cards through the Chase Affiliate Program are customers of Chase. Affiliate has no authority to make or accept any offer on behalf of Chase. All Chase policies regarding customer orders, including availability, pricing and problem resolution, will apply to these customers. Affiliate has no authority to make, and Chase is not responsible for, any representations made by Affiliate that contradict these policies.   11. Product Descriptions   Affiliate will only use credit card descriptions provided or approved in writing by Chase.   12. Copyrighted Material   Affiliate is solely responsible for ensuring that its reviews and articles obey all applicable copyright and other laws. Generally, Affiliate must have express permission to use another party's copyrighted or other proprietary material. Chase is not responsible for Affiliate's improper use of another party's copyrighted or proprietary material.

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007





  13. Commercial Use   This program is intended for commercial use only. Commissions are payable for Approved Accounts to third parties who access the Chase URL's (marketing pages) through the Links located on Affiliate's sponsoring Web site. Affiliates who use this program to apply for credit cards for their own use are NOT in violation of this Agreement.   14. Trademarks   All Chase trademarks, trade names and service marks (collectively, the Marks) are the exclusive property of Chase. Notwithstanding anything set forth in this Agreement, Chase reserves full ownership of the Marks and the Licensed Materials (as defined below). All   use of the Marks by Affiliate is limited solely to the use contemplated by this Agreement. All use of Chase Marks by Affiliate is subject to the prior written approval of Chase.   15. Licenses and Use of the Chase Logos and Trademarks   Chase grants Affiliate a non-exclusive, nontransferable, revocable right to (a) access the Chase site through the links solely in accordance with the terms of this Agreement and (b) solely in connection with such links, to use Chase's logos, trade names, trademarks, and similar identifying material relating to Chase (collectively, the Licensed Materials), for the sole purpose of booking Chase products. Prior to using any of the Licensed Materials, Affiliate will submit to Chase for approval a draft of all proposed material that incorporates the Licensed Materials, together with a brief statement setting forth the proposed use of such materials and any other background or supporting material reasonably requested by Chase to allow Chase to make an informed judgment. All such materials shall be submitted to Chase at least seven (7) days prior to the date of first intended use. Chase will notify Affiliate of its approval or disapproval of such materials within five (5) business days of its receipt of all information required to be submitted.   The approval or disapproval of such materials will be in Chase's sole discretion. Any materials not receiving Chase's specific written preliminary approval will be deemed disapproved. Affiliate may not alter, modify, or change the Licensed Materials in any way. Affiliate is only entitled to use the licensed materials to the extent that it is a member in good standing of the Chase Affiliate Program. Affiliate agrees not to use the Licensed Materials in any manner that is disparaging or that otherwise portrays Chase in a negative light. Chase may revoke Affiliate's license at any time.   16. Service Interruption   Certain technical difficulties may, from time to time, result in service interruptions. Affiliate agrees not to hold Chase responsible for the consequences of such interruptions.   17. Indemnification

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007





  Affiliate hereby agrees to indemnify, defend, and hold harmless Chase, its shareholders, officers, directors, employees, agents, affiliates and their respective directors, officers, employees and agents, successors and assigns, from and against any and all claims, demands, losses, liabilities, damages or expenses (including attorneys' fees and costs) of any nature whatsoever incurred or suffered by Chase (collectively the losses), in so far as such losses (or actions in respect thereof) arise out of, are related to, or are based on (i) the breach of any representation, warranty, or covenant made by Affiliate herein; or (ii) any claim related to Affiliate's site.   18. Confidentiality   Except as otherwise provided in this Agreement or with the consent of the other party hereto, each of the parties hereto agrees that all information including, without limitation, the terms of this Agreement, business and financial information, customer and vendor lists, and pricing and sales information, concerning Chase, Customer or Affiliate shall remain strictly confidential and secret and shall not be utilized, directly or indirectly, by such party for its own business purposes or for any other purpose except and solely to the extent necessary to exercise rights and perform obligations under this Agreement. The foregoing restrictions will not apply to information to the extent it (i) was known to the receiving party at the time of disclosure; (ii) has become publicly known through no wrongful act of the receiving party; (iii) has been rightfully received from a third party under no obligation to the disclosing party; (iv) has been disclosed by court order or as otherwise required by law if the receiving party has given the disclosing party a reasonable opportunity to contest or limit the scope of such required disclosure.   19. Modification   Chase reserves the right to change any and all of the terms and conditions in this Agreement, at any time and in its sole discretion, by posting a new agreement on its Website. Without limiting the generality of the foregoing, the amount of Commissions, the definition of Approved Accounts, and all other provisions of this Agreement are subject to change without notice other than posting such information on the Chase Website. IF ANY MODIFICATION IS UNACCEPTABLE TO AFFILIATE, THE ONLY RECOURSE IS TO TERMINATE THIS AGREEMENT. AFFILIATE'S CONTINUED PARTICIPATION IN THE AFFILIATE PROGRAM FOLLOWING CHASE'S POSTING OF A NEW AGREEMENT ON ITS WEB SITE WILL CONSTITUTE BINDING ACCEPTANCE OF THE CHANGE.   20. Warranty Disclaimer   Chase makes no warranties, representations or conditions with regard to the Chase Affiliate Program or any services provided hereunder, whether express or implied, arising by law or otherwise, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR NONINFRINGEMENT OR ANY IMPLIED WARRANTY ARISING OUT OF COURSE OF PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE.

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007





  21. Limitation of Damages   Chase shall have no liability for any indirect, incidental, special or consequential damages or any loss of revenue or profits arising under or with respect to this Agreement or the Affiliate Program, regardless of whether Chase has been advised of the possibility of such damages. Further, Chase's aggregate liability arising under or with respect to this Agreement or the Affiliate Program shall in no event exceed the total Commissions paid or payable by Chase to Affiliate under this   Agreement.   22. Independent Investigation   AFFILIATE ACKNOWLEDGES THAT IT HAS READ THIS AGREEMENT, HAS HAD AN OPPORTUNITY TO CONSULT WITH ITS OWN LEGAL ADVISERS IF IT SO DESIRED, AND AGREES TO ALL ITS TERMS AND CONDITIONS. AFFILIATE AGREES THAT, IN INTERPRETING THIS AGREEMENT, NO WEIGHT SHALL BE PLACED UPON THE FACT THAT THIS AGREEMENT HAS BEEN DRAFTED BY CHASE, AND IT SHALL NOT ASSERT THAT THIS AGREEMENT IS UNENFORCEABLE OR INVALID ON THE GROUNDS THAT IT IS A CONTRACT OF ADHESION, THAT IT IS UNCONSCIONABLE, OR ANY SIMILAR THEORY. AFFILIATE UNDERSTANDS THAT CHASE MAY AT ANY TIME (DIRECTLY OR INDIRECTLY) SOLICIT CUSTOMER REFERRALS ON TERMS THAT MAY DIFFER FROM THOSE CONTAINED IN THIS AGREEMENT.   23. Governing Law   This Agreement will be governed in all respects by the laws of the State of Delaware, including its conflict with law provisions.   Accept.   Appendix   List of Restricted Trademark Terms   Partner Restricted Trademark Terms Chase Brand Add Chase as a negative Keyword to your Search strategy.   In addition, the following terms are prohibited: Chase, Chase bank, www.chase.com, www.creditcardsatchase.com, www.chasecreditcard.com, chase.com, creditcardsatchase.com, chasecreditcard.com, chase credit card, chase credit cards, Chase Freedom, Freedom Card   AARP AARP.org, AARP.com, AARP membership, AARPmagazine.com, AARPhealthcare.com, AARP foundation, AARP passport, www.travelocity.com/AARP, AARP Bulletin, American Association of Retired Persons, AARP Insurance, AARP partner, AARP providers, AARP advocacy, Segunda Juventud, AARP Hot Deals Amazon Amazon, Amazon.com, www.amazon.com, Amazon Books, Amazon DVD, Amazon Movies, Amazon Music Borders Borders, Borders Stores, Borders Books, www.borders.com, www.bordersbooks.com Waldenbooks, Waldenbooks Stores, www.waldenbooks.com, www.waldenbooksstores.com

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007





  British Air British Airways, British Air, www.britishairways.com, www.ba.com, ba, Continental See Continental Tab Disney See Disney Tab Hess Hess, www.hess.com, Amerada Holiday Inn/Priority Club Holiday Inn, Holiday Inn Express, Priority Club, IHG, www.ichotelsgroup.com, InterContinental, InterContinental Hotels Group, Crowne Plaza, Hotel Indigo, Staybridge Suites, Candlewood Suites, Marathon Marathon, Marathon Oil, Marathon Petroleum Company, Speedway, Speedway SuperAmerica, SuperAmerica Marriott www.marriottrewards.com, www.marriott.com, Marriott, Marriott Rewards Overstock overstock.com, www.overstock.com, overstocked.com, overstock/com, overstock com, overstock com, overstockcom, overstock .com, overstock?com, overstock>com, overstock, overstocked.com, overstocks.com, over stock.com, overstock .com, overstockcom Sony Sony, www.sonystyle.com, ImageStation, My Sony, Vaio, EverQuest Speedway Speedway SuperAmerica, Speedway, SuperAmerica, Speedy Rewards, Marathon, Marathon Oil, Marathon Petroleum Company Starbucks Starbucks, Starbucks Coffee, Starbucks Foundation, Starbucks Coffee Company, Starbucks Corporation Subaru Subaru, My Subaru, Subaru World, Subaru of America Toys www.toysrus.com, Toysrus.com, Toys R Us, Toys R Us International, KidsRUs, BabiesRUs, Babiesrus.com, Toyologist, Toysrus/Amazon, Babiesrus/Amazon, www.personalizedbyrus.com Trump Trump, www.trump.com, The Apprentice, Trumped, Trump University, Trump Taj Mahal, Trump Plaza, Trump Marina, Trump Indiana, Trump Club Privee, Trump National Golf Club, Trump Tower, Trump Park Avenue, Trump World Tower, Trump International Hotel & Tower, Trump Place, Trump Palace, Trump Parc & Trump Parc East, Trump Grande, Mar-a-Lago United See United Tab Universal Universal, Universal Studios, Universal Movies, Unviersal Entertainment, Universal Hollywood, www.universal.com, Universal movie tickets, universal movie ticket, universal theme parks, universal discount, universal discounts, universal ticket, universal tickets, universal vacation, universal vacations, universal travel, universal deals, universal offer, universal offers, universal park, universal parks, universal getaway, universal getaways, universal family getaway, universal family getaways, universal deal, universal deals Volkswagen Volkswagen, Volkswagen International, Volkswagen Group, Volkswagen AG, Audi   Disney Restricted Key Words cheap disney vacation disney world vacations cheap disney vacations disneyland bargain child vacation disneyland bargains childrens vacations disneyland cheap discount disney travel disneyland discount discount disney vacation disneyland discounts discount disney vacations disneyland offer discount vacation disneyland offers discount vacations disneyland promotion

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007





  disney disneyland promotions disney bargain disneyland save disney bargains disneyland save disney cheap disneyland savings disney cruise disneyland savings disney cruise vacations disneyland travel disney deal disneyland trip disney discount disneyland trips disney family vacation disneyland vacation disney family vacations disneyland vacations disney florida vacation disneyworld bargain disney florida vacations disneyworld bargains disney golf vacations disneyworld cheap disney honeymoon disneyworld offer disney honeymoon vacation disneyworld offers disney honeymoons disneyworld promotions disney offer disneyworld save disney offers disneyworld savings disney package disneyworld vacation disney package vacations disneyworld vacations disney promotion family vacation disney promotions family vacations disney resort kid vacation disney resort vacation kids vacations disney resort vacations magic kingdom disney resorts orlando disney vacations disney savings orlando rentals disney travel orlando vacations disney travel package special disney travel disney vacation special vacation packages disney vacation club walt disney bargain disney vacations walt disney bargains disney vacations florida walt disney cheap disney vacations orlando walt disney deal disney world bargain walt disney deals disney world bargains walt disney offer disney world cheap walt disney offers disney world discount walt disney resort vacations disney world offer walt disney save disney world offers walt disney savings disney world package walt disney vacation disney world save walt disney vacations disney world savings walt disney world vacation disney world vacation walt disney world vacations     United Restricted Key Words united airlines united air fare united united airlines reservations online united air united airline fare united.com United Escapes united airline international united flights www.united.com untied air united flight united first class unitedairlines.com United Vacation

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007





  UAL united travel united airlines.com united star alliance ual.com united airlines specials united air lines united discounts www.unitedairlines.com united trip united airlines schedule travel with united united airline travel united airlines discounts united reservation united airlines official website www.ual.com united business class united express united airlines airports united reservations united airlines star alliance www.united airlines.com united non-stop flights united fares united packages united airline flight international united travel united and airlines united airlines economy plus United Vacations united airports united airlines tickets united group travel united airlines flights United Escape united express airlines easy update united flights united air vacations unitedair united fare sale United airfare united last minute fares www.united airlines united efares untied airlines united getaways www.unitedairlines united low fares united airline.com united airlines bookings united air line cities united flies united airlines travel fly on united united airlines homepage united airlines group travel united airlines website united airlines travel certificates united destinations United Easy Update united airline flights united airlines business travel united airlines home page united special deals United airfares united business travel e-fares untiedair united airlines site united economy class united airlines fares united package deals www.unitedairline.com international united ticket united airlines home international united tickets united airlines vacations shop for united flights vacation travel United EasyUpdate united specials fly with united www.united airline.com united e fares unitied airlines united travel certificates united deals united air star alliance international united flight united fare search united airlines online United Escapes united e-fares international united flight united airlines cities united airlines online united air fare united e-fares united airlines reservations online united airlines cities united airline fare

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007





  Continental Restricted Key Words Continental airlines Continental air fare Continental Continental airlines reservations online continental.com Continental airline fare continental airline international Continental flights www.continental.com Continental air continental flight Continental first class continental air lines Continental Vacation continental airlines schedule Continental travel continental airline travel Continental airlines specials continental reservation Continental discounts continental reservations Continental trip continental fares travel with Continental continental airline flight Continental airlines discounts continental and airlines Continental airlines official website Continental Vacations Continental business class continental airlines tickets Continental airlines airports continental airlines flights Continental non stop flights continental flights continental airlines Continental packages continental air line International Continental travel continental airlines travel Continental airports continental airlines homepage Continental group travel continental airlines website Continental air vacations continental destinations Continental fare sale continental airlines vacations Continental last minute fares continental air fare Continental getaways continental airlines reservations online Continental low fares continental airline fare Continental airlines bookings international continental flight cities Continental flies continental airlines online fly on Continental continental airlines cities Continental airlines group travel Continental economy class Continental airlines travel certificates Continental package deals Continental airlines business travel international Continental ticket Continental special deals international Continental tickets Continental business travel shop for Continental flights fly with Continental

Source: CREDITCARDS.COM, INC., S-1, 8/10/2007 
Question: Highlight the parts (if any) of this contract related to Cap On Liability that should be reviewed by a lawyer. Details: Does the contract include a cap on liability upon the breach of a party’s obligation? This includes time limitation for the counterparty to bring claims or maximum amount for recovery.

SOLUTION: Further, Chase's aggregate liability arising under or with respect to this Agreement or the Affiliate Program shall in no event exceed the total Commissions paid or payable by Chase to Affiliate under this   Agreement.

PROBLEM: Exhibit 1.1   400,000 Shares   BLUEROCK RESIDENTIAL GROWTH REIT, INC.   8.250% Series A Cumulative Redeemable Preferred Stock   AGENCY AGREEMENT   May 25, 2016   Compass Point Research & Trading, LLC 1055 Thomas Jefferson Street N.W. Suite 303 Washington, DC 20007   As Sales Agent   Dear Ladies and Gentlemen:   Bluerock Residential Growth REIT, Inc., a Maryland corporation (the Company), together with Bluerock Residential Holdings, L.P., a Delaware limited partnership for which the Company is the sole general partner (the Operating Partnership and together with the Company, the Transaction Entities) and BRG Manager, LLC, a Delaware limited liability company (the Manager), agrees that it may issue and sell through Compass Point Research & Trading, LLC, acting as agent (the Agent), up to a total of 400,000 shares (the Offered Shares) of its 8.250% Series A Cumulative Redeemable Preferred Stock, par value $0.01 per share (the Series A Preferred Stock) as set forth below. Notwithstanding anything to the contrary contained herein, the parties hereto agree that compliance with the limitation set forth in this paragraph on the number of Offered Shares issued and sold under this Agreement shall be the sole responsibility of the Company, and the Agent shall have no obligation in connection with such compliance.   Pursuant to the Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership (the OP Agreement), as amended by that First Amendment to the Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership, as further amended by that Second Amendment to the Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership, as further amended by that Third Amendment to the Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership and as further amended by the Fourth Amendment to the Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership, upon receipt of the net proceeds of the sale of the Offered Shares on the Settlement Date (as defined below), the Company, through its wholly-owned subsidiary, Bluerock REIT Holdings, LLC, a Delaware limited liability company (Holdings LLC), will contribute such net proceeds to the Operating Partnership in exchange for a number of 8.250% Series A Cumulative Redeemable Preferred Units of partnership interest in the Operating Partnership (the Series A Preferred OP Units) that is equivalent to the number of Offered Shares to be sold (the Company Preferred OP Units).









  1. Representations and Warranties of the Transaction Entities.   (a) Representations and Warranties. The Transaction Entities, jointly and severally, represent and warrant to, and agree with, the Agent that:   (i) Filing and Effectiveness of Registration Statement; Certain Defined Terms. The Company has filed with the Commission a registration statement on Form S-3 (No. 333-208956) covering the registration of the Offered Shares under the Act, including a base prospectus (the Base Prospectus). Such registration statement, as amended, including the financial statements, exhibits and schedules thereto, in the form in which it became effective under the Act, including all documents incorporated or deemed to be incorporated by reference therein and any information deemed to be a part thereof at the time of effectiveness pursuant to Rule 430B under the Act, shall be referred to as the Registration Statement. Any registration statement filed by the Company pursuant to Rule 462(b) under the Act in connection with the offer and sale of the Offered Shares is called the Rule 462(b) Registration Statement, and from and after the date and time of filing of any such Rule 462(b) Registration Statement the term Registration Statement shall include the Rule 462(b) Registration Statement. As used herein, the term Prospectus shall mean the final prospectus supplement to the Base Prospectus dated the date hereof that describes the Offered Shares and the offering thereof (the Final Prospectus Supplement), together with the Base Prospectus, in the form first used by the Agent to meet requests of purchasers pursuant to Rule 173 under the Act. References herein to the Prospectus shall refer to both the prospectus supplement and the Base Prospectus components of such prospectus, including all documents incorporated or deemed to be incorporated by reference therein.   The Registration Statement has been declared effective under the Act. The Offered Shares all have been duly registered under the Act pursuant to the Registration Statement. The Company has complied, to the Commission's satisfaction, with all requests of the Commission for additional or supplemental information, if any. No stop order suspending the effectiveness of or use of the Registration Statement has been issued under the Act, and no order preventing or suspending the use of the Prospectus has been issued and no proceedings for any such purposes have been instituted and are pending or, to the knowledge of the Company, are contemplated by the Commission, and any request on the part of the Commission for additional information from the Company in connection with the Registration Statement has been complied with. The Company meets the requirements for use of Form S-3 under the Act. The documents incorporated or deemed to be incorporated by reference in the Registration Statement, the General Disclosure Package (as defined below) and the Prospectus, at the time they were or hereafter are filed with the Commission, or became effective under the Exchange Act, as the case may be, complied and will comply (as applicable) in all material respects with the requirements of the Exchange Act.

  2







  For purposes of this Agreement:   430B Information, with respect to any registration statement, means information included in a prospectus and retroactively deemed to be a part of such registration statement pursuant to Rule 430B(b).   Act means the Securities Act of 1933, as amended.   Applicable Time means of the time of the sale of the Offered Shares pursuant to this Agreement.   Settlement Date has the meaning defined in Section 3 hereof.   Commission means the Securities and Exchange Commission.   Effective Time with respect to the Registration Statement, means the date and time as of which such Registration Statement was declared effective by the Commission.   Environmental Law means any federal, state or local law, statute, ordinance, rule, regulation, order, decree, judgment, injunction, permit, license, authorization or other binding requirement, or common law, relating to health, safety or the protection, cleanup or restoration of the environment or natural resources, including those relating to the distribution, processing, generation, treatment, storage, disposal, transportation, other handling or release or threatened release of Hazardous Materials.   Exchange Act means the Securities Exchange Act of 1934, as amended.   General Disclosure Package means the Prospectus, together with the information and free writing prospectuses, if any, identified in  Schedule A hereto. General Use Issuer Free Writing Prospectus means any Issuer Free Writing Prospectus that is intended for general distribution to prospective investors (other than a bona fide electronic road show, defined in Rule 433 (the Bona Fide Electronic Road Show)), as evidenced by its being so specified in Schedule A to this Agreement.   Hazardous Materials  means any material (including, without limitation, pollutants, contaminants, hazardous or toxic substances or wastes), the presence of which in the environment is prohibited, regulated or serves as the basis of liability as defined, listed or regulated by any Environmental Law.

  3







  Issuer Free Writing Prospectus means any issuer free writing prospectus, as defined in Rule 433, relating to the Offered Shares, including, without limitation, any free writing prospectus (as defined in Rule 405) relating to the Offered Shares that is (i) required to be filed with the Commission by the Company, (ii) a road show that is a written communication within the meaning of Rule 433(d)(8)(i), whether or not required to be filed with the Commission, or (iii) exempt from filing with the Commission pursuant to Rule 433(d)(5)(i) because it contains a description of the Offered Shares or of the offering of the Offered Shares that does not reflect the final terms, in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in the Company's records pursuant to Rule 433(g).   Limited Use Issuer Free Writing Prospectus means any Issuer Free Writing Prospectus that is not a General Use Issuer Free Writing Prospectus.   A Registration Statement without reference to a time means such Registration Statement as of its Effective Time. For purposes of the foregoing definitions, 430B Information with respect to a Registration Statement shall be considered to be included in such Registration Statement as of the time specified in Rule 430B.   LTIP Units means the special units of partnership interest of the Operating Partnership having the rights, preferences and other privileges designated in Section 4.04 and elsewhere in the OP Agreement.   Rules and Regulations means the rules and regulations of the Commission.   Securities Laws means, collectively, the Sarbanes-Oxley Act of 2002 (Sarbanes-Oxley), the Act, the Exchange Act, the Rules and Regulations, the auditing principles, rules, standards and practices applicable to auditors of issuers (as defined in Sarbanes-Oxley) promulgated or approved by the Public Company Accounting Oversight Board and, as applicable, the rules of the NYSE MKT, LLC (the NYSE MKT) (Exchange Rules).   Statutory Prospectus means the Base Prospectus, as amended and supplemented immediately prior to the Applicable Time, including any document incorporated by reference therein and any prospectus supplement deemed to be a part thereof. For purposes of this definition, Rule 430B Information contained in a form of prospectus that is deemed retroactively to be a part of the Registration Statement shall be considered to be included in the Statutory Prospectus as of the actual time that such form of prospectus is filed with the Commission pursuant to Rule 424(b) under the Act.

  4







  Subsidiary or Subsidiaries means each of the entities listed on Schedule A, which i) comprise all of the subsidiaries of the Transaction Entities, including the entities in which the Operating Partnership owns, directly or indirectly, all of the membership interests; ii) hold assets and iii) such omitted entities are considered in the aggregate as a single subsidiary, would not constitute a significant subsidiary within the meaning of Rule 1-02(w) of Regulation S-X.   Unless otherwise specified, a reference to a rule or Rule is to the indicated rule under the Act.   (ii) Compliance with Securities Act Requirements. (A) (1) At the Effective Time, (2) on the date of this Agreement and (3) on the Settlement Date, the Registration Statement or any post-effective amendment thereto complied and will comply in all respects to the requirements of the Act and the Rules and Regulations thereunder, and did not, does not and will not include any untrue statement of a material fact or omitted, omits or will omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; and (B) the Prospectus and each amendment or supplement thereto, as of their respective issue dates, complied and will comply in all material respects with the Act and the Rules and Regulations thereunder, and neither the Prospectus nor any amendment or supplement thereto (including any prospectus wrapper), as of its issue date, at the time of any filing with the Commission pursuant to Rule 424(b) and at the Settlement Date, included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The representations and warranties contained herein do not apply to statements in or omissions from any document discussed herein based upon written information furnished to the Company by the Agent specifically for use therein, it being understood and agreed that such information is only that described as such in Section 8(b) hereof (collectively, the Agent Information).   (iii) General Disclosure Package. As of the Applicable Time and on the Settlement Date, none of (A) the General Disclosure Package, (B) any individual Limited Use Issuer Free Writing Prospectus, when considered together with the General Disclosure Package and/or (C) each road show, if any, when considered together with, and as may be corrected by, the General Disclosure Package, included, includes or will include any untrue statement of a material fact or omitted, omits or will omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The preceding sentence does not apply to statements in or omissions from any Statutory Prospectus, Issuer Free Writing Prospectus or road show made in reliance upon and in conformity with the Agent Information.

  5







  (iv) Issuer Free Writing Prospectuses. Each Issuer Free Writing Prospectus, as of its issue date and, to the extent not superseded or modified, at all subsequent times through the completion of the offer and sale of the Offered Shares did not, does not and will not include any information that conflicted, conflicts or will conflict with the information then contained in the Registration Statement or the Prospectus. Each Issuer Free Writing Prospectus conformed, conforms or will conform in all respects to the requirements of the Act and the Rules and Regulations thereunder. The Company has not made any offer relating to the Offered Shares that would constitute an Issuer Free Writing Prospectus without the prior written consent of the Agent; provided that such consent is deemed to have been given with respect to each Issuer Free Writing Prospectus identified on Schedule A to this Agreement. The Company (A) has filed or will file each Issuer Free Writing Prospectus required to be filed with the Commission pursuant to the Act and the Rules and Regulations thereunder in accordance therewith and/or (B) has retained or will retain in accordance with the Act and the Rules and Regulations thereunder all Issuer Free Writing Prospectuses that were not required to be filed pursuant to the Act and the Rules and Regulations thereunder. The Company has made any Bona Fide Electronic Road Show in compliance with Rule 433(d)(8)(i) such that no filing of any road show (as defined in Rule 433(h)) is required in connection with the offering of the Series A Preferred Stock.   (v) Ineligible Issuer Status. As of the determination date referenced in Rule 164(h) under the Act, the Company was not, is not or will not be (as applicable) an ineligible issuer in connection with the offering of the Offered Shares pursuant to Rules 164, 405 and 433, including (x) the Company or its subsidiaries in the preceding three years not having been convicted of a felony or misdemeanor or having been made the subject of a judicial or administrative decree or order as described in Rule 405 and (y) the Company or its subsidiaries in the preceding three years not having been the subject of a bankruptcy petition or insolvency or similar proceeding, not having had a registration statement be the subject of a proceeding or examination under Section 8 of the Act and not being the subject of a pending proceeding under Section 8A of the Act in connection with an offering, all as described in Rule 405.   (vi) Good Standing of the Transaction Entities. The Company has been duly incorporated and is validly existing as a corporation under the laws of the State of Maryland and is in good standing with the State Department of Assessments and Taxation of Maryland, with the full corporate power and authority to own its properties and conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus and to enter into and perform its obligations under this Agreement to which it is a party; and the Company is duly qualified to do business as a foreign corporation in good standing in all other jurisdictions in which its ownership or lease of property or the conduct of its business requires such qualification, except where the failure to be so qualified would not, individually or in the aggregate, result in a material adverse effect on the condition (financial or otherwise), results of operations, earnings, business, properties or prospects of the Transaction Entities and each of their respective Subsidiaries, taken as a whole (a Material Adverse Effect). The Operating Partnership has been duly formed and is validly existing as a limited partnership in good standing under the laws of the State of Delaware, with power and authority to own its properties and conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus and to enter into and perform its obligations under this Agreement to which it is a party; and the Operating Partnership is duly qualified to do business as a foreign organization in good standing in all other jurisdictions in which its ownership or lease of property or the conduct of its business requires such qualification, except where the failure to be so qualified would not, individually or in the aggregate, result in a Material Adverse Effect.

  6







  (vii) Subsidiaries. Each Subsidiary (including, without limitation, Holdings LLC) has been duly incorporated or organized and is validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with power and authority (corporate or other) to own its properties and conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus; and each Subsidiary is duly qualified to do business as a foreign corporation or organization in good standing in all other jurisdictions in which its ownership or lease of property or the conduct of its business requires such qualification, except where the failure to be so qualified would not, individually or in the aggregate, result in a Material Adverse Effect; all of the issued and outstanding capital stock, partnership interests or membership interests of each Subsidiary, including the outstanding LTIP Units of the Operating Partnership, has been duly authorized and validly issued and is fully paid and nonassessable (except with respect to future contributions as provided in the operating agreement or limited partnership agreement (or similar organizational document) of the applicable Subsidiary made subsequent to the date hereof); and the capital stock, membership interest, limited partnership interest or other equity interest of each Subsidiary held by the Transaction Entities or a Subsidiary, as applicable, is held as set forth on Schedule C hereto. The Transaction Entities, directly or indirectly through their respective Subsidiaries, hold good and marketable title to their equity interests in their respective Subsidiaries, in each case free and clear of any lien, encumbrance or security interest, except as described in the Registration Statement, the General Disclosure Package and the Prospectus, subject only to restrictions on transfer imposed under applicable U.S. federal and state securities laws and the limited liability company agreement, limited partnership agreement or other organizational document of each Subsidiary; and have not conveyed, transferred, assigned, pledged or hypothecated any of their respective equity interests in their Subsidiaries, in whole or in part, or granted any rights, options or rights of first refusal or first offer to purchase any of such interests or any portion thereof.

  7







  (viii) Subsidiaries of Transaction Entities. The Transaction Entities do not own or control, directly or indirectly, any corporation, association or other entity other than (i) the subsidiaries listed in Exhibit 21 to the Registration Statement, (ii) the subsidiaries not listed on Exhibit 21 but listed on Schedule A hereto, and (ii) such other entities omitted from Exhibit 21 which, when such omitted entities are considered in the aggregate as a single subsidiary, would not constitute a significant subsidiary within the meaning of Rule 1-02(w) of Regulation S-X.   (ix) Authorization of the Agreement. This Agreement has been duly authorized, executed and delivered by each of the Transaction Entities and is enforceable against each Transaction Entity in accordance with the applicable terms contained herein.   (x) Shares. The Offered Shares and all outstanding shares of capital stock of the Company have been duly authorized; the authorized equity capitalization of the Company is as set forth in the Registration Statement, the General Disclosure Package and the Prospectus under the caption Capitalization, all outstanding shares of capital stock of the Company are, and when the Offered Shares have been delivered and paid for in accordance with this Agreement on the Settlement Date as set forth in the Registration Statement, the General Disclosure Package and the Prospectus, such Offered Shares will be, validly issued, fully paid and nonassessable, will conform to the information in the Registration Statement, the General Disclosure Package and the Prospectus and to the description of such Offered Shares contained therein; the stockholders of the Company have no preemptive rights with respect to the Offered Shares; none of the outstanding shares of capital stock have been issued in violation of any preemptive or similar rights of any security holder; any forms of certificates used to represent the Offered Shares comply in all material respects with all applicable statutory requirements and with any applicable requirements of the Organizational Documents of the Company, and with any requirements of the NYSE MKT. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there are no outstanding (a) securities of the Company reserved for any purpose (other than certain outstanding common units of partnership interest in the Operating Partnership (the OP Units) and LTIP Units disclosed in the General Disclosure Package and the Prospectus), (b) securities or obligations of the Company convertible into or exchangeable for any shares of common stock, $0.01 par value per share, of the Company (the Common Stock), Series A Preferred Stock or shares of Series B Redeemable Preferred Stock outstanding, par value $0.01 per share (the Series B Preferred Stock), (c) warrants, rights or options to subscribe for or purchase from the Company any such shares of Common Stock, Series A Preferred Stock or Series B Preferred Stock or any such convertible or exchangeable securities or obligations or (d) obligations of the Company to issue or sell any shares of Common Stock, Series A Preferred Stock or Series B Preferred Stock, any such convertible or exchangeable securities or obligations, or any such warrants, rights or options. At the Settlement Date, should the maximum number of Offered Shares be sold, there will be 19,565,106 shares of Common Stock outstanding, 5,721,460 shares of Series A Preferred Stock outstanding, 1,169,881 LTIP Units outstanding, 5,721,460 Series A Preferred OP Units outstanding, warrants to purchase approximately 25,720 shares of Common Stock outstanding, approximately 1,286 shares of Series B Preferred Stock, approximately 1,286 Series B Preferred Units of partnership interest in the Operating Partnership (the Series B Preferred OP Units) and 19,870,674 OP Units outstanding, and each such class of securities conforms to the description set out in the Registration Statement, the General Disclosure Package and the Prospectus.

  8







  (xi) No Equity Awards. Except for grants (including those subject to issuance under the Management Agreement) disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, the Company has not granted, to any person or entity a stock option or other equity-based award of or to purchase Common Stock, Series A Preferred Stock or Series B Preferred Stock pursuant to an equity-based compensation plan or otherwise.   (xii) OP Units and Preferred OP Units.   (1) OP Units. All outstanding OP Units have been duly authorized; all outstanding OP Units are validly issued and will conform to the information in the Registration Statement, the General Disclosure Package and the Prospectus and to the description of such OP Units contained therein; the holders of the outstanding OP Units have no preemptive rights with respect to the outstanding OP Units; none of the outstanding OP Units have been issued in violation of any preemptive or similar rights of any security holder; all outstanding OP Units have been issued and sold in compliance with all applicable federal and state securities laws. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there are no outstanding (a) securities of the Operating Partnership reserved for any purpose, (b) securities or obligations of the Operating Partnership convertible into or exchangeable or redeemable for any partnership interests of the Operating Partnership, (c) warrants, rights or options to subscribe for or purchase from the Operating Partnership any such partnership interests or any such convertible or exchangeable securities or obligations or (d) obligations of the Operating Partnership to issue or sell any partnership interests, any such convertible or exchangeable securities or obligations, or any such warrants, rights or options. There are 19,870,674 OP Units outstanding, of which the Company owns, directly or indirectly, 19,565,106 OP Units.

  9







  (2) Series A Preferred OP Units. All outstanding Series A Preferred OP Units have been duly authorized; all outstanding Series A Preferred OP Units are validly issued and will conform to the information in the Registration Statement, the General Disclosure Package and the Prospectus and to the description of such Series A Preferred OP Units contained therein; the holders of the outstanding OP Units have no preemptive rights with respect to the outstanding Series A Preferred OP Units; none of the outstanding Series A Preferred OP Units have been issued in violation of any preemptive or similar rights of any security holder; all outstanding Series A Preferred OP Units have been issued and sold in compliance with all applicable federal and state securities laws. The Company Preferred OP Units have been duly authorized; when the Company Preferred OP Units have been delivered and paid for in accordance with the OP Agreement, the Company Preferred OP Units will be validly issued and will conform to the information in the Registration Statement, the General Disclosure Package and the Prospectus and to the description of such Company Preferred OP Units contained therein; there are no outstanding preemptive rights with respect to the Company Preferred OP Units; none of the outstanding  Company Preferred OP Units have been issued in violation of any preemptive or similar rights of any security holder; all Company Preferred OP Units have been and will be, issued and sold in compliance with all applicable federal and state securities laws. There are 5,321,460 Series A Preferred OP Units outstanding, and at the Settlement Date, should all Offered Shares be sold pursuant to this Agreement, there will be 5,721,460 Series A Preferred OP Units outstanding, of which the Company will own, directly or indirectly, 100% of such Series A Preferred OP Units.    (3) Series B Preferred OP Units. All outstanding Series B Preferred OP Units have been duly authorized; all outstanding Series B Preferred OP Units are validly issued and will conform to the information in the Registration Statement, the General Disclosure Package and the Prospectus and to the description of such Series B Preferred OP Units contained therein; the holders of the outstanding OP Units have no preemptive rights with respect to the outstanding Series B Preferred OP Units; none of the outstanding Series B Preferred OP Units have been issued in violation of any preemptive or similar rights of any security holder; all outstanding Series B Preferred OP Units have been issued and sold in compliance with all applicable federal and state securities laws. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there are no outstanding (a) securities of the Operating Partnership reserved for any purpose, (b) securities or obligations of the Operating Partnership convertible into or exchangeable or redeemable for any partnership interests of the Operating Partnership, (c) warrants, rights or options to subscribe for or purchase from the Operating Partnership any such partnership interests or any such convertible or exchangeable securities or obligations or (d) obligations of the Operating Partnership to issue or sell any partnership interests, any such convertible or exchangeable securities or obligations, or any such warrants, rights or options. As of the Settlement Date there are approximately 1,286 Series B Preferred OP Units outstanding, of which the Company owns, directly or indirectly, 100% of Series B Preferred OP Units.

  10







  (xiii) No Finder's Fee. Except for the Agent's discounts and commissions payable by the Company to the Agent in connection with the Offered Shares contemplated herein or as otherwise disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there are no contracts, agreements or understandings that would give rise to a valid claim against the Company or the Agent for a brokerage commission, finder's fee or other like payment in connection with this offering.   (xiv) Registration Rights. Except as described in the Registration Statement, General Disclosure Package and the Prospectus, there are no contracts, agreements or understandings by either of the Transaction Entities or their respective Subsidiaries, on the one hand, and any person, on the other hand, granting such person the right to require either of the Transaction Entities or such Subsidiaries to file a registration statement under the Act with respect to any securities of either of the Transaction Entities or their respective Subsidiaries owned or to be owned by such person or to require either of the Transaction Entities or such Subsidiaries to include such securities in the securities registered pursuant to a Registration Statement or in any securities being registered pursuant to any other registration statement filed by either of the Transaction Entities or such Subsidiaries under the Act (collectively, Registration Rights).   (xv) Articles Supplementary. The articles supplementary of the Company designating the rights and preferences of the Offered Shares (the Articles Supplementary), comply with all applicable requirements under the Maryland General Corporation Law (the MGCL).

  11







  (xvi) Listing. The Offered Shares are registered under Section 12(b) of the Exchange Act, which registration will be maintained pursuant to Section 12(b) of the Exchange Act as of the Settlement Date; and the Company has applied for approval for the listing of the Offered Shares on the NYSE MKT and will receive such approval prior to the Settlement Date.   (xvii) Absence of Further Requirements. No consent, approval, authorization, or order of, or filing or registration with, any governmental agency or body or any court is required for the consummation of the transactions contemplated by this Agreement, the OP Agreement or any other agreements in connection with the offering, issuance and sale of the Offered Shares by the Company or the issuance and sale of the Company Preferred OP Units by the Operating Partnership or the performance of obligations hereunder or pursuant to the terms of the Offered Shares, except the filing of the Prospectus under the Act and a Form 8-K under the Exchange Act and except such as have been already obtained or as may be required under state securities laws, FINRA or the NYSE MKT.   (xviii) Title to Property. (1) The Transaction Entities hold, directly or indirectly through their respective Subsidiaries, good and marketable fee simple title to all of the real property described in the Registration Statement, the General Disclosure Package and the Prospectus and the improvements (exclusive of improvements owned by tenants, if applicable) located thereon (individually, a Property and collectively, the Properties), in each case, free and clear of all liens, encumbrances, claims, security interests, restrictions and defects, except such as are disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, or do not materially affect the value of such Properties as a whole and do not materially interfere with the use made and proposed to be made of such Properties as a whole by the Company; (2) except as set forth in the Registration Statement, the General Disclosure Package and the Prospectus, none of the Transaction Entities or any of their respective Subsidiaries owns any real property other than the Properties; (3) except as set forth in the Registration Statement, the General Disclosure Package and the Prospectus, the mortgages or deeds of trust that encumber certain of the Properties are not convertible into debt or equity securities of the Transaction Entities and their respective Subsidiaries and such mortgages and deeds of trust are not cross-defaulted with any loan not made to, or cross-collateralized to any property not owned directly or indirectly by, the Transaction Entities or their respective Subsidiaries; (4) each of the Properties complies with all applicable codes, laws and regulations (including without limitation, building and zoning codes, laws and regulations and laws relating to access to the Properties), except as would not individually or in the aggregate materially affect the value of the Properties or interfere in any material respect with the use made and proposed to be made of the Properties by the Transaction Entities; (5) except as set forth in the Registration Statement, the General Disclosure Package and the Prospectus, neither of the Transaction Entities nor their respective Subsidiaries has received from any governmental authority any written notice of any condemnation of or zoning change affecting the Properties or any part thereof which if consummated would reasonably be expected to have a Material Adverse Effect on the Transaction Entities and their respective Subsidiaries, taken as a whole, and none of the Transaction Entities and their respective Subsidiaries know of any such condemnation or zoning change which is threatened and, in each case, which if consummated would reasonably be expected to have a Material Adverse Effect on the Transaction Entities and their respective Subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary course of business; (6) no third party has an option or a right of first refusal to purchase any Property or any portion thereof or direct interest therein, except as such is set forth in the Registration Statement, the General Disclosure Package and the Prospectus; and (7) each of the Transaction Entities or one of its respective Subsidiaries has obtained an owner's title insurance policy, from a title insurance company licensed to issue such policy, on each Property that insures the Transaction Entities', the respective Subsidiary's fee interest in such Property.

  12







  (xix) Leases. (1) Each of the Transaction Entities or one of its Subsidiaries holds the lessor's interest under the applicable leases with any tenants occupying each Property (collectively, the Leases); (2) other than the Leases, none of the Transaction Entities or their respective Subsidiaries has entered into any agreements that would materially affect the value of the Properties as a whole or would materially interfere with the use made and proposed to be made of such Properties as a whole by the Transaction Entities; (3) none of the Transaction Entities, their respective Subsidiaries, or, to the Transaction Entities' knowledge, any other party to any Lease, is or, upon consummation of the transaction contemplated by this Agreement, will be in breach or default of any such Lease, except as to any such breach or default as would not have a Material Adverse Effect on the Transaction Entities and their respective Subsidiaries, taken as a whole; (4) no event has occurred or, to the Transaction Entities' knowledge, has been threatened in writing, which with or without the passage of time or the giving of notice, or both, would, individually or together with all such other events, constitute a default under any Lease, or would, permit termination, modification or acceleration under such Lease, except as to any such default as would not have a Material Adverse Effect on the Transaction Entities and their respective Subsidiaries, taken as a whole; (5) each of the Leases is valid and binding and in full force and effect, subject to applicable bankruptcy, insolvency, moratorium or other similar laws relating to creditors' rights and general principles of equity, except as would not have a Material Adverse Effect on the Transaction Entities or their respective Subsidiaries; and (6) none of the Transaction Entities, their respective Subsidiaries, or, to the Transaction Entities' knowledge, any other party to any Lease, is a party to any ground lease, sublease or operating sublease relating to any of their Properties.

  13







  (xx) Utilities. To the knowledge of the Transaction Entities and their respective Subsidiaries, water, stormwater, sanitary sewer, electricity and telephone service are all available at the property lines of each Property over duly dedicated streets or perpetual easements of record benefiting the applicable Property.   (xxi) Absence of Defaults and Conflicts Resulting from Transaction. The execution, delivery and performance of this Agreement, and the issuance and sale of the Offered Shares by the Company (including the issuance of the Conversion Shares (as defined below)) and the issuance and sale of the Company Preferred OP Units by the Operating Partnership, and the use of net proceeds therefrom as contemplated by the Registration Statement, the General Disclosure Package and the Prospectus, will not result in a breach or violation of any of the terms or provisions of, or constitute a default or, to the extent applicable, a Debt Repayment Triggering Event (as defined below) under or result in the imposition of any lien, charge or encumbrance upon any property or assets of the Transaction Entities or any of their respective Subsidiaries pursuant to (A) the Organizational Documents (as defined below) of the Transaction Entities or any of their respective Subsidiaries, (B) any statute, rule, regulation or order of any governmental agency or body or any court, domestic or foreign, having jurisdiction over the Transaction Entities or any of their respective Subsidiaries or any of their Properties, or (C) any agreement, lease, contract, indenture or other agreement or instrument to which the Transaction Entities or any of their respective Subsidiaries is a party or by which the Transaction Entities or any of their respective Subsidiaries is bound or to which any of the Properties of the Transaction Entities or any of their respective Subsidiaries is subject, and except in case of clause (B) only, for such defaults, violations, liens, charges or encumbrances that would not, individually or in the aggregate, result in a Material Adverse Effect.   A Debt Repayment Triggering Event means any event or condition that gives, or with the giving of notice or lapse of time would give, the holder of any guarantee, note, debenture or other evidence of indebtedness (or any person acting on such holder's behalf) the right to require the satisfaction, repurchase, redemption or repayment of all or a portion of such indebtedness by the Transaction Entities or any of their respective Subsidiaries.   The term Organizational Documents as used herein means (a) in the case of a trust, its declaration of trust and bylaws; (b) in the case of a corporation, its charter and bylaws; (c) in the case of a limited or general partnership, its partnership certificate, certificate of formation or similar organizational documents and its partnership agreement; (d) in the case of a limited liability company, its articles of organization, certificate of formation or similar organizational documents and its operating agreement, limited liability company agreement, membership agreement or other similar agreement; and (e) in the case of any other entity, the organizational and governing documents of such entity.

  14







  (xxii) Absence of Existing Defaults and Conflicts. Neither of the Transaction Entities nor any of their respective Subsidiaries is (A) in violation of its respective Organizational Documents; (B) in default (or with the giving of notice or lapse of time would be in default) under any existing obligation, agreement, covenant or condition contained in any indenture, loan, contract, note, agreement, mortgage, lease or other agreement or instrument to which any of them is a party or by which any of them is bound or to which any of the properties of any of them is subject; or (C) in violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except in the case of clauses (B) and (C) above, for any such default or violation that would not, individually or in the aggregate, have a Material Adverse Effect.   (xxiii) Absence of Dividend Restriction. Except as set forth in the Registration Statement, the General Disclosure Package and the Prospectus, (i) neither of the Transaction Entities nor any of their respective Subsidiaries is currently prohibited, restricted or limited in its respective ability to pay, directly or indirectly, distributions or dividends to its equity holders, limited partners, general partners or members, as applicable, (ii) no Subsidiary is prohibited, directly or indirectly, from repaying to the Transaction Entities any loans or advances to such Subsidiary from the Transaction Entities or from transferring any of such Subsidiary's property or assets to the Transaction Entities or any other Subsidiary and (iii) the Operating Partnership is not prohibited, directly or indirectly, from repaying to the Company any loans or advances to the Operating Partnership from the Company or from transferring any of the Operating Partnership's property or assets to the Company.   (xxiv) Possession of Licenses and Permits. The Transaction Entities and each of their respective Subsidiaries possess, and are in compliance with the terms of, all adequate certificates, authorizations, franchises, licenses and permits (Licenses) necessary or material to the conduct of the business now conducted or proposed in the Registration Statement, the General Disclosure Package and the Prospectus to be conducted by them and have not received any notice of proceedings relating to the revocation or modification of any Licenses that, if determined adversely to the Transaction Entities or any of their respective Subsidiaries, would, individually or in the aggregate, have a Material Adverse Effect.

  15







  (xxv) Absence of Labor Dispute. No labor dispute with the employees of the Transaction Entities or their respective Subsidiaries exists, except as described in the Registration Statement, General Disclosure Package or Prospectus, or, to the knowledge of the Transaction Entities, is imminent, which, in any such case, would, singly or in the aggregate, result in a Material Adverse Effect.   (xxvi) Possession of Intellectual Property. The Transaction Entities and their respective Subsidiaries have access to, adequate patents, patent rights, licenses, inventions, copyrights, know how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks, trade names or other intellectual property necessary to conduct the business now operated by them; and neither the Transaction Entities nor their respective Subsidiaries have received any notice of infringement of or conflict with asserted rights of others with respect to any of the foregoing which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a Material Adverse Effect on the Transaction Entities and their respective Subsidiaries, taken as a whole.   (xxvii) Environmental Laws. Except as described in the Registration Statement, General Disclosure Package and the Prospectus and except as would not reasonably be expected to result, singly or in the aggregate, in a Material Adverse Effect, neither of the Transaction Entities nor any of their respective Subsidiaries (and, to the knowledge of the Transaction Entities, no tenant or subtenant of any Property or portion thereof owned or leased by the Transaction Entities or their respective Subsidiaries) is in violation of any Environmental Law, including relating to the release of Hazardous Materials, and there are no pending or, to the knowledge of the Transaction Entities, threatened administrative, regulatory or judicial actions, suits, demands, claims, liens, notices of noncompliance, investigations or proceedings relating to any such violation or alleged violation. There are no past or present events, conditions, circumstances, activities, practices, actions, omissions or plans that could reasonably be expected to give rise to any costs or liabilities to the Transaction Entities or any of their respective Subsidiaries under, or to interfere with or prevent compliance by the Transaction Entities or any of their respective Subsidiaries with, Environmental Laws, except as such would not have a Material Adverse Effect and would not have a material adverse effect on a Property or a prospective acquisition property described in the Prospectus, or any of their respective operations, financial results or value. There are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties) that would, singly or in the aggregate, have a Material Adverse Effect.

  16







  (xxviii) Accurate Disclosure. The statements in the Registration Statement, the General Disclosure Package and the Prospectus under the captions Prospectus Supplement Summary, Additional Material Federal Income Tax Considerations, Bluerock Residential Growth REIT, Inc., Description of the Securities We May Offer, Description of Capital Stock, Description of Depositary Shares, Description of Debt Securities, Description of Warrants, Description of Units, Book Entry Procedures and Settlement, Important Provisions of Maryland Corporate Law and Our Charter and Bylaws, Material Federal Income Tax Considerations, and Plan of Distribution, insofar as such statements summarize legal matters, agreements, documents or proceedings discussed therein, are accurate and fair summaries of such legal matters, agreements, documents or proceedings and present the information required to be shown.   (xxix) Absence of Manipulation. None of the Transaction Entities, any of their respective Subsidiaries or any affiliates of the Transaction Entities, has taken, directly or indirectly, any action that is designed to or that has constituted or that would cause or result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Offered Shares.   (xxx) Statistical and Market-Related Data. Any third-party statistical and market-related data included in the Registration Statement, the General Disclosure Package and the Prospectus are based on or derived from sources that the Transaction Entities believe to be reliable and accurate and, to the extent required, they have obtained written consent to use such data from such sources.   (xxxi) Compliance with the Sarbanes-Oxley Act. There is and has been no failure on the part of the Company or any of the Company's directors or officers, in their capacities as such, to comply in all material respects with any applicable provision of the Sarbanes-Oxley Act and the rules and regulations promulgated in connection therewith, including Section 402 related to loans and Sections 302 and 906 related to certifications.   (xxxii) Internal Controls. The Transaction Entities and each of their respective subsidiaries maintain (A) effective internal controls over financial reporting (as defined under Rule 13a-15 and Rule 15d-15 under the Exchange Act) and (B) a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management's general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management's general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus, since the end of the Company's most recent audited fiscal year, there has been (i) no material weakness in the Company's internal control over financial reporting (whether or not remediated) and (ii) no change in the Company's internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting. Other than as set forth in the Registration Statement, the General Disclosure Package and the Prospectus, since the date of the most recent balance sheet of the Company reviewed or audited by the Company's accountants, (i) the Audit Committee of the Board of Directors of the Company (the Board) has not been advised of (A) any significant deficiencies in the design or operation of internal controls that could adversely affect the ability of the Company to record, process, summarize and report financial data, or any material weaknesses in internal controls and (B) any fraud, whether or not material, that involves management or other employees who have a significant role in the internal controls of the Company, and (ii) there have been no significant changes in internal controls over financial reporting that has materially affected the Company's internal controls over financial reporting, including any corrective actions with regard to significant deficiencies and material weaknesses.

  17







  (xxxiii) Disclosure Controls. The Company and its subsidiaries maintain an effective system of disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15 under the Exchange Act) that complies with the requirements of the Exchange Act and that has been designed to provide reasonable assurances that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission's rules and forms, including controls and procedures designed to ensure that such information is accumulated and communicated to the Company's management as appropriate to allow timely decisions regarding required disclosure, and such disclosure controls and procedures are effective in all material respects to perform the functions for which they were established.   (xxxiv) XBRL. The interactive data in extensible Business Reporting Language included in the Registration Statement fairly presents the information called for in all material respects and has been prepared in accordance with the Commission's rules and guidelines applicable thereto.

  18







  (xxxv) Litigation. Other than as described in the Registration Statement, General Disclosure Package and Prospectus, there are no pending actions, suits or proceedings (including any inquiries or investigations by any court or governmental agency or body, domestic or foreign) against or affecting the Transaction Entities or any of their respective Subsidiaries or Properties that, if determined adversely to the Transaction Entities or any of their respective Subsidiaries or Properties, would materially and adversely affect the ability of the Transaction Entities to perform their respective obligations under this Agreement, or which are otherwise material in the context of the sale of the Offered Shares; and no such actions, suits or proceedings (including any inquiries or investigations by any court or governmental agency or body, domestic or foreign) are threatened or, to the Transaction Entities' knowledge, contemplated against their respective Subsidiaries or the Properties.   (xxxvi) Financial Statements; Non-GAAP Financial Measures. The financial statements of the Company and its consolidated subsidiaries included in the Registration Statement, the General Disclosure Package and the Prospectus, together with the related schedules and notes, present fairly in all material respects the financial position of the Company and its consolidated subsidiaries as of the dates indicated, and the balance sheet, statements of operations, changes in members' equity and cash flows of the Company and its consolidated subsidiaries for the periods specified; said financial statements have been prepared in conformity with GAAP applied on a consistent basis throughout the periods involved and comply with the Commission's rules and guidelines with respect thereto. The supporting schedules included in the Registration Statement, the General Disclosure Package and the Prospectus relating to the Company and its consolidated subsidiaries present fairly in accordance with GAAP the information required to be stated therein. The combined statements of revenue and certain expenses included in the Registration Statement, the General Disclosure Package and the Prospectus, together with the related notes, comply with Rule 8-06 of Regulation S-X and present fairly in all material respects the revenue and certain expenses of the applicable Property for the periods specified; said financial statements have been prepared in conformity with GAAP applied on a consistent basis throughout the periods involved and comply with the Commission's rules and guidelines with respect thereto. The selected financial data and the summary financial information included in the Registration Statement, the General Disclosure Package and the Prospectus present fairly the information shown therein and have been compiled on a basis consistent with that of the audited, or unaudited as applicable, financial statements of the Company and its consolidated Subsidiaries included therein and comply with the Commission's rules and guidelines with respect thereto. The pro forma financial statements, if any, and the related notes thereto included in the Registration Statement, the General Disclosure Package and the Prospectus present fairly in all material respects the information shown therein, comply with the Commission's rules and guidelines with respect to pro forma financial statements and have been properly compiled on the bases described therein, and the assumptions used in the preparation thereof are reasonable and the adjustments used therein are appropriate to give effect to the transactions and circumstances referred to therein. Except as included therein, no historical or pro forma financial statements or supporting schedules are required to be included in the Registration Statement, the General Disclosure Package or the Prospectus under the Act or Rules and Regulations thereunder. All disclosures contained in the Registration Statement, the General Disclosure Package or the Prospectus regarding non- GAAP financial measures (as such term is defined by the Rules and Regulations ) comply with Regulation G of the Exchange Act and Item 10 of Regulation S-K of the Act to the extent applicable.

  19







  (xxxvii) No Material Adverse Change in Business. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, since the end of the period covered by the latest audited financial statements included therein (A) there has been no change, nor any development or event involving a prospective change, in the condition (financial or otherwise), results of operations, business, earnings, properties or prospects of the Transaction Entities and their respective subsidiaries, taken as a whole, that is material and adverse, (B) there has been no dividend or distribution of any kind declared, paid or made by the Transaction Entities and the Subsidiaries, on any class of the capital stock, membership interest or other equity interest, as applicable, except as would not have been required to be disclosed pursuant to the Exchange Act or the Exchange Act Regulations, (C) there has been no material change in the capital shares of stock, short-term indebtedness, long-term indebtedness, net current assets or net assets of the Transaction Entities or any of their respective Subsidiaries, (D) there has not been any material transaction entered into or any material transaction that is probable of being entered into by the Transaction Entities and their respective Subsidiaries, other than transactions in the ordinary course of business and changes and transactions disclosed or described in the Registration Statement, the General Disclosure Package and the Prospectus, (E) there has not been any obligation, direct or contingent, which is material to the Transaction Entities and their respective Subsidiaries, taken as a whole, incurred by the Transaction Entities and their respective Subsidiaries, except obligations incurred in the ordinary course of business and changes and transactions disclosed or described in the Registration Statement, the General Disclosure Package and the Prospectus, and (F) none of the Transaction Entities or any of their subsidiaries has sustained any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor disturbance or dispute or any action, order or decree of any court or arbitrator or governmental or regulatory authority that would, singly or in the aggregate, have a Material Adverse Effect.

  20







  (xxxviii) Investment Company Act. Neither of the Transaction Entities are, nor after giving effect to the offering and sale of the Offered Shares and the application of the proceeds thereof as described in the Registration Statement, the General Disclosure Package and the Prospectus, will be required to register as an investment company as defined in the Investment Company Act of 1940, as amended (the Investment Company Act).   (xxxix) Indebtedness. Neither the Transaction Entities nor any of their respective Subsidiaries has any indebtedness as of the date of this Agreement, and neither the Transaction Entities nor any of their respective Subsidiaries will have any indebtedness immediately prior to the sale of the Offered Shares on the Settlement Date, in each case except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus.   (xl) Insurance. The Transaction Entities and each of their respective Subsidiaries are insured by insurers with appropriately rated claims paying abilities against such losses and risks and in such amounts as are prudent and customary for the businesses in which they are engaged; all policies of insurance and fidelity or surety bonds insuring the Transaction Entities, their respective Subsidiaries or their respective businesses, assets, employees, officers and directors are in full force and effect; neither of the Transaction Entities nor any of their respective Subsidiaries has been refused any insurance coverage sought or applied for; neither of the Transaction Entities nor any of their respective Subsidiaries has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a similar cost as currently paid, except as set forth in or contemplated in the Registration Statement, the General Disclosure Package and the Prospectus; and the Company has obtained or will obtain directors' and officers' insurance in such amounts as is customary for companies engaged in the type of business conducted by the Company.   (xli) Tax Law Compliance. Each of the Transaction Entities and the Subsidiaries has timely filed all federal, state and local tax returns that are required to be filed or has timely requested extensions thereof (Returns), except for any failures to file that, individually or collectively, would not result in a Material Adverse Effect, and has paid all taxes required to be paid by it and any other assessment, fine or penalty levied against it, to the extent that any of the foregoing is due and payable, except for any such assessments, fines or penalties that are currently being contested in good faith or that, individually or collectively, would not result in a Material Adverse Effect. No audits or other administrative proceedings or court proceedings are presently pending against any of the Transaction Entities or the Subsidiaries with regard to any Returns, and no taxing authority has notified any of the Transaction Entities or the Subsidiaries that it intends to investigate its tax affairs, except for any such audits or investigations that, individually or collectively, would not result in the assessment of material taxes.

  21







  (xlii) Real Estate Investment Trust. The Company has been organized and has operated in conformity with the requirements for qualification and taxation as a real estate investment trust (a REIT) under the Internal Revenue Code of 1986, as amended (the Code), for its taxable years ended December 31, 2010 through December 31, 2015, and the Company's organization and method of operation (as described in the Registration Statement, the General Disclosure Package and the Prospectus) will enable the Company to continue to meet the requirements for qualification and taxation as a REIT under the Code for its taxable year ending December 31, 2016 and thereafter. All statements regarding the Company's qualification and taxation as a REIT set forth in the Registration Statement, the General Disclosure Package and the Prospectus are correct in all material respects.   (xliii) Accuracy of Exhibits. There are no contracts or other documents that are required to be described in the Registration Statement, the General Disclosure Package or the Prospectus or to be filed as exhibits to the Registration Statement that are not described or filed as required by Item 601 of Regulation S-K or otherwise under the Rules and Regulations.   (xliv) No Restriction on Subsidiaries. No Subsidiary of the Company is currently prohibited, directly or indirectly, under any agreement or other instrument to which it is a party or is subject, from paying any dividends to the Company, from making any other distribution on such Subsidiary's capital stock or membership interest, from repaying to the Company any loans or advances to such Subsidiary from the Company or from transferring any of such Subsidiary's properties or assets to the Company or any other Subsidiary of the Company, except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus.   (xlv) No Unlawful Payments. None of the Transaction Entities, any of their respective Subsidiaries, any director or officer or, to the knowledge of the Transaction Entities, any agent, employee or other person associated with or acting on behalf of the Transaction Entities or any of their respective Subsidiaries, has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder; or (iv) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.

  22







  (xlvi) Compliance with Anti-Money Laundering Laws. The operations of the Transaction Entities and their respective Subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the applicable anti-money laundering statutes of all jurisdictions in which the Transaction Entities and their respective Subsidiaries conduct business or whose Anti-Money Laundering Laws (as defined below) apply to the Transaction Entities, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the Anti-Money Laundering Laws) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Transaction Entities or any of their respective Subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Transaction Entities, threatened.   (xlvii) Compliance with OFAC. None of the Transaction Entities, any of their respective subsidiaries or, to the knowledge of either of the Transaction Entities, any director, officer, agent, employee or affiliate thereof is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (OFAC); and the Company will not, directly or indirectly, use the proceeds of the offering of the Series A Preferred Stock hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered or enforced by OFAC.   (xlviii) Prior Sales of Series A Preferred Stock, Series B Preferred Stock, Series A Preferred OP Units, Series B Preferred OP Units, Series A OP Units or LTIP Units. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, the Company has not sold, issued or distributed any Series A Preferred Stock and Series B Preferred Stock, and the Operating Partnership has not issued, sold or distributed any  Series A Preferred OP Units, Series B Preferred OP Units, Series A OP Units or LTIP Units during the six-month period preceding the date hereof.   (xlix) Fourth Amendment to the OP Agreement. The terms of the Fourth Amendment to the OP Agreement provide for a sufficient number of Series A Preferred OP Units, the terms of which are substantially similar to the terms of the Series A Preferred Stock.

  23







  (l) Compliance with Laws. Each of the OP Agreement, the First Amendment to the OP Agreement, the Second Amendment to the OP Agreement, the Third Amendment and the Fourth Amendment to the OP Agreement comply with all applicable laws and each of the aforementioned amendments to the OP Agreement have been adopted in accordance with the OP Agreement.   (li) Independent Accountants. BDO USA, LLP and Plante & Moran, PLLC, who have certified the financial statements and supporting schedules included in the Registration Statement, the General Disclosure Package and the Prospectus are independent public accountants as required by the Act, the Rules and Regulations and the Public Company Accounting Oversight Board.   (lii) ERISA Matters. The Transaction Entities and each of their Subsidiaries is in compliance in all material respects with all presently applicable provisions of the Employee Retirement Income Security Act of 1974, as amended, including the regulations and published interpretations thereunder (ERISA); no reportable event (as defined in ERISA) has occurred with respect to any pension plan (as defined in ERISA) for which the Transaction Entities and each Subsidiary would have any liability; the Transaction Entities and each Subsidiary has not incurred and does not expect to incur liability under (i) Title IV of ERISA with respect to termination of, or withdrawal from, any pension plan or (ii) Sections 412, 403, 431, 432 or 4971 of the Code; and each pension plan for which the Transaction Entities or any Subsidiary would have any liability that is intended to be qualified under Section 401(a) of the Code is so qualified in all material respects and nothing has occurred, whether by action or by failure to act, which would cause the loss of such qualification.   (liii) Enforceability of Management Agreement. The Management Agreement by and among the Transaction Entities and the Manager (the Management Agreement), has been duly authorized by the Transaction Entities and constitutes a valid and binding agreement of the Transaction Entities enforceable in accordance with its terms, except to the extent limited by applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws relating to or affecting creditors' rights and remedies generally, and subject, as to enforceability, to general principles of equity and, with respect to equitable relief, the discretion of the court before which any proceeding therefor may be brought (regardless of whether enforcement is sought in a proceeding at law or in equity).   (liv) Subsidiary Partnership Tax Classification. Each of the Operating Partnership and each Subsidiary that is a partnership or a limited liability company under state law has been at all relevant times properly classified as a partnership or a disregarded entity, and not as a corporation or an association taxable as a corporation, for federal income tax purposes.

  24







  (lv) Related-Party Transactions. There are no relationships, whether direct or indirect, or related-party transactions involving the Transaction Entities or any of their respective Subsidiaries or any other person required to be described in the Registration Statement, the General Disclosure Package or the Prospectus that have not been described as required by the Act.   (b) Certificates of Officers. Any certificate signed by any officer of either Transaction Entity, as applicable, and delivered to the Agent or its counsel in connection with the offering of the Offered Shares shall be deemed a representation and warranty by each Transaction Entity, as applicable, as to matters covered thereby, to the Agent.   2. Representations and Warranties Regarding the Manager.   (a) Representations and Warranties. The Manager represents and warrants to the Agent and agrees with the Agent that:   (i) Good Standing of the Manager. The Manager has been duly organized and is validly existing as a limited liability company in good standing under the laws of the State of Delaware and has full power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus and to enter into and perform its obligations under this Agreement; and the Manager and each of its subsidiaries is duly qualified as a foreign entity to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure so to qualify or to be in good standing would not result in a Material Adverse Effect.   (ii) Authorization of Agreement. This Agreement has been duly authorized, executed and delivered by the Manager.   (iii) Absence of Further Requirements. No consent, approval, authorization, or order of, or filing or registration with, any court or governmental authority or agency is necessary or required for the performance by the Manager of its obligations under this Agreement and the Management Agreement, except such as have been already obtained or as may be required under the Act, Exchange Act Regulations, state securities laws, FINRA or the NYSE MKT.   (iv) Absence of Defaults and Conflicts. The Manager is not in violation of its organizational documents or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Manager is a party or will be a party in connection with this Agreement (including the Management Agreement) or by which it may be bound, or to which any of the property or assets of the Manager is subject (collectively, Manager's Agreements and Instruments), except for such violations or defaults that would not result in a Material Adverse Effect; and the execution, delivery and performance of this Agreement do not and will not, and in the case of the performance of the Management Agreement, will not, whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default or repayment event under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Manager pursuant to, the Manager's Agreements and Instruments (except for such conflicts, breaches, defaults or repayment events or liens, charges or encumbrances that would not result in a Material Adverse Effect), nor will such action result in any violation of (A) the provisions of the Organizational Documents of the Manager or (B) any statute, law, rule, regulation, or order of any government agency or body or any court, domestic or foreign, having jurisdiction over the Manager or any of its assets, properties or operations, except in the case of clause (B) only, for any such violation that would not result in a Material Adverse Effect.

  25







  (v) Possession of Licenses and Permits. The Manager possesses, and is in compliance with the terms of, all Licenses necessary or material to the conduct of the business of the Manager now conducted or proposed in the Registration Statement, the General Disclosure Package and the Prospectus to be conducted by the Manager, except where the failure to possess such Licenses would not, singly or in the aggregate, result in a Material Adverse Effect, and has not received any notice of proceedings relating to the revocation or modification of any Licenses that, if determined adversely to the Manager would, individually or in the aggregate, have a Material Adverse Effect.   (vi) Employment; Noncompetition; Nondisclosure. The Manager has not been notified that any of its executive officers or key employees named in the Registration Statement, the General Disclosure Package and the Prospectus (each, a Company-Focused Professional) plans to terminate his or her employment with the Manager. Neither the Manager nor, to the knowledge of the Manager, any Company-Focused Professional is subject to any noncompete, nondisclosure, confidentiality, employment, consulting or similar agreement that would be violated by the present or proposed business activities of the Company or the Manager as described in the Registration Statement, the General Disclosure Package and the Prospectus.   (vii) Accurate Disclosure. The statements regarding the Manager in the Registration Statement, the General Disclosure Package and the Prospectus under the captions Prospectus Supplement Summary, Risk Factors, Description of Capital Stock—Distributions and Bluerock Residential Growth REIT, Inc., are true and correct in all material respects.

  26







  (viii) Absence of Manipulation. The Manager has not taken, and will not take, directly or indirectly, any action that is designed to or that has constituted or that would be expected to cause or result in stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Offered Shares.   (ix) Absence of Proceedings. There are no actions, suits or proceedings (including any inquiries or investigations by any court or governmental agency or body, domestic or foreign) now pending, or, to the knowledge of the Manager, threatened against or affecting the Manager that, if determined adversely to the Manager, would, individually or in the aggregate, have a Material Adverse Effect.   (x) Investment Advisers Act. The Manager is not prohibited by the Investment Advisers Act of 1940, as amended, or the rules and regulations thereunder, from performing its obligations under the Management Agreement as described in the Registration Statement, the General Disclosure Package and the Prospectus.   (xi) Enforceability of Management Agreement. The Management Agreement has been duly authorized by all necessary action and constitutes a valid and binding agreement of the Manager enforceable in accordance with its terms, except to the extent limited by applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws relating to or affecting creditors' rights and remedies generally, and subject, as to enforceability, to general principles of equity and, with respect to equitable relief, the discretion of the court before which any proceeding therefor may be brought (regardless of whether enforcement is sought in a proceeding at law or in equity).   (xii) Internal Controls. The Manager operates under the Company's system of internal accounting controls in order to provide reasonable assurances that (A) transactions effectuated by it on behalf of the Company pursuant to its duties set forth in the Management Agreement are executed in accordance with management's general or specific authorization; and (B) access to the Company's assets is permitted only in accordance with management's general or specific authorization.   (xiii) Resources. The Manager has the financial and other resources available to it necessary for the performance of its services and obligations as contemplated hereby and in the Management Agreement, the Registration Statement, the General Disclosure Package and the Prospectus.

  27







  (b) Certificates of Officers. Any certificate signed by any officer of the Manager and delivered to the Agent or its counsel shall be deemed a representation and warranty by the Manager as to matters covered thereby, to the Agent.   3. Sale and Delivery of Offered Shares.   On the basis of the representations, warranties and agreements and subject to the terms and conditions set forth herein, the Agent will use commercially reasonable efforts on behalf of the Company in connection with the Agent's services hereunder. No offers or sales of the Offered Shares shall be made to any person without the prior approval of such person by the Company, such approval to be at the reasonable discretion of the Company. The Agent's aggregate fee for its services hereunder will be an amount equal to 3.15% of the gross proceeds from the sale of the Offered Shares sold to Purchasers that are not affiliates of the Agent (such fee payable by the Company at and subject to the consummation of Settlement). The Company, upon consultation with the Agent, may establish in the Company's sole discretion an aggregate amount of Shares to be sold in the offering contemplated hereby, which aggregate amount shall be reflected in the Prospectus.   The Company acknowledges and agrees that (i) there can be no assurance that the Agent will be successful in selling the Offered Shares, and (ii) the Agent will incur no liability or obligation to the Company or any other person or entity if it does not sell the Offered Shares for any reason other than a failure by the Agent to use its commercially reasonable efforts consistent with its normal trading and sales practices to sell such Offered Shares as required herein.   The Company will deliver the Offered Shares to or as directed by the Agent in a form reasonably acceptable to the Agent at or before 11:30 A.M., New York time, on May 26, 2016, or at such other time not later than seven (7) full business days thereafter as the Agent and the Company mutually determine, in the sole discretion of each, such time being herein referred to as the Settlement Date. Immediately and only upon receipt of funds equal to the gross offering price of the Offered Shares, the Agent will then facilitate payment of the proceeds net of the Agent's fees specified herein, to the Company in Federal (same day) funds by wire transfer to an account at a bank acceptable to the Agent drawn to the order of the Company at the office of Bass, Berry & Sims PLC (BBS), no later than 5:30 P.M., New York time, on May 26, 2016. If, as of 5 P.M., New York time, on the Settlement Date, the settlement of the Offered Shares has not been fully consummated, including without limitation, receipt of the net offering proceeds by the Company, then Agent shall use its best efforts to promptly deliver any of the Offered Shares that have been transferred by the Company to the credit of the Agent's or its designee's account to the Company's designated account through coordination with the Company and its transfer agent. For purposes of Rule 15c6-1 under the Exchange Act, the Settlement Date (if later than the otherwise applicable settlement date) shall be the settlement date for payment of funds and delivery of securities for all the Offered Shares sold pursuant to the offering. The Offered Shares so to be delivered or evidence of their issuance will be made available for review at the above office of BBS at least 24 hours prior to the Settlement Date.

  28







  4. Reserved.   5. Certain Agreements of the Transaction Entities and the Manager.   (a) The Transaction Entities agree with the Agent that:   (i) Additional Filings. Unless filed pursuant to Rule 462(b) as part of the Rule 462(b) Registration Statement in accordance with the last sentence, the Company will file the Prospectus, in a form approved by the Agent, with the Commission pursuant to and in accordance with Rule 424(b) and Rule 430B and during the time period specified by Rule 424(b) and Rule 430B. The Company will advise the Agent promptly of any such filing pursuant to Rule 424(b) and provide satisfactory evidence to the Agent of such timely filing.   (ii) Filing of Amendments; Response to Commission Requests. The Company, subject to Section 5(a)(iii) hereof, will comply with the requirements of Rule 430B and will promptly advise the Agent of any proposal to amend or supplement at any time the Registration Statement or any Statutory Prospectus and will not affect such amendment or supplementation without the Agent's consent; and the Company will also advise the Agent promptly of (A) any amendment or supplementation of a Registration Statement or any Statutory Prospectus, (B) any request by the Commission or its staff for any amendment to any Registration Statement, for any supplement to any Statutory Prospectus or for any additional information, (C) the institution by the Commission of any stop order proceedings in respect of a Registration Statement or, to the Company's knowledge, the threatening of any proceeding for that purpose, and (D) the receipt by the Company of any notification with respect to the suspension of the qualification of the Offered Shares in any jurisdiction or the institution or, to the Company's knowledge, the threatening of any proceedings for such purpose. The Company will use its best efforts to prevent the issuance of any such stop order or the suspension of any such qualification and, if issued, to obtain as soon as possible the withdrawal thereof.   (iii) Reserved.

  29







  (iv) Continued Compliance with Securities Laws. To comply with the Act and the Rules and Regulations thereunder so as to permit the completion of the distribution of the Offered Shares as contemplated in this Agreement and in the General Disclosure Package and the Prospectus. If, during such period after the first date of the placement of the Offered Shares as in the opinion of counsel for the Agent the Prospectus (or in lieu thereof the notice referred to in Rule 173(a)) is (or, but for the exception afforded by Rule 172, would be) required by law to be delivered in connection with sales by an Agent or dealer, any event shall occur or condition exist as a result of which it is necessary, in the opinion of counsel for the Agent or for the Company, to (i) amend the Registration Statement in order that the Registration Statement will not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) amend or supplement the General Disclosure Package or the Prospectus in order that the General Disclosure Package or the Prospectus, as the case may be, will not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time it is delivered to a purchaser or (iii) amend the Registration Statement or amend or supplement the General Disclosure Package or the Prospectus, as the case may be, in order to comply with the requirements of the Act or the Rules and Regulations thereunder, the Company will promptly (A) notify the Agent of such event, (B) prepare any amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement, the General Disclosure Package or the Prospectus comply with such requirements and, a reasonable amount of time prior to any proposed filing or use, furnish the Agent with copies of any such amendment or supplement and (C) file with the Commission any such amendment or supplement; provided, that the Company shall not file or use any such amendment or supplement to which the Agent or its counsel shall reasonably object. The Company will give the Agent notice of its intention to make any filings pursuant to the Exchange Act or Rules and Regulations thereunder from the date of this Agreement to the Settlement Date and will furnish the Agent with copies of any such documents a reasonable amount of time prior to such proposed filing, as the case may be, and will not file or use any such document to which the Agent or its counsel shall reasonably object, other than such filings as are required to be made pursuant to the Exchange Act or the Rules and Regulations thereunder.   (v) Rule 158. The Company will timely file such reports pursuant to the Exchange Act as are necessary in order to make generally available to its stockholders as soon as practicable an earnings statement for the purposes of, and to provide to the Agent the benefits contemplated by, the last paragraph of Section 11(a) of the Act.   (vi) Furnishing of Registration Statements and Prospectuses. The Company will furnish to the Agent signed copies of each Registration Statement (including all exhibits thereto), each related Statutory Prospectus, and, so long as a prospectus relating to the Offered Shares is (or but for the exemption in Rule 172 would be) required to be delivered under the Act, the Prospectus and all amendments and supplements to such documents, in each case in such quantities as the Agent requests. The Prospectus shall be so furnished on or prior to 9:00 A.M., New York time, on the business day following the execution and delivery of this Agreement, or at such time as otherwise agreed to by the Agent. All other documents shall be so furnished as soon as available. The Company will pay the expenses of printing and distributing to the Agent all such documents.

  30







  (vii) Blue Sky Qualifications. The Company will arrange for the qualification of the Offered Shares for sale under the laws of such jurisdictions as the Agent designate and will continue such qualifications in effect so long as required for the distribution but in no event longer than one year.   (viii) Reporting Requirements. The Company, during the period when a prospectus relating to the Offered Shares is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the Act, will file all documents required to be filed with the Commission pursuant to the Exchange Act within the time periods required by the Exchange Act and Rules and Regulations related thereto.   (ix) Payment of Expenses. The Transaction Entities will pay all expenses incident to the performance of their obligations under this Agreement and all the costs and expenses in connection with the offering of the Offered Shares including but not limited to (A) any filing fees and other expenses incurred in connection with qualification of the Offered Shares for sale under the laws of such jurisdictions as the Agent designate and the preparation and printing of blue sky surveys or legal investment surveys relating thereto, (B) costs and expenses related to the review by the Financial Industry Regulatory Authority, Inc. (FINRA) of the Offered Shares (including filing fees and the fees and expenses of counsel for the Agent relating to such review), (C) costs and expenses of legal counsel for the Agent incurred in connection with this Agreement and the offering of the Offered Shares not to exceed $35,000, (D) costs and expenses of the Company relating to investor presentations and any road show in connection with the offering and sale of the Offered Shares, if any, including, without limitation, (1) any travel expenses of the Company's officers and employees and (2) any other expenses of the Company, including all actually and reasonably incurred costs and expenses of the Agent advanced on behalf of the Company relating to the investor presentations and any roadshow in connection with the offering and sale of the Offered Shares, (E) the fees and expenses incident to listing the Offered Shares and Conversion Shares on the NYSE MKT, (F) expenses incurred in distributing the Prospectus (including any amendments and supplements thereto) to the Agent, (G) expenses incurred for preparing, printing and distributing any Issuer Free Writing Prospectuses to investors or prospective investors, (H) stamp duties, similar taxes or duties or other similar fees or charges, if any, incurred by the Agent in connection with the offering and sale of the Offered Shares;  provided,  however that the Transaction Entities shall have no obligation to pay any costs and expenses of the Agent relating to the investor presentations and any roadshow in connection with the offering and sale of the Offered Shares, other than costs and expenses advanced on behalf of the Company in accordance with (D) above.

  31







  (x) Use of Proceeds. The Company will use the net proceeds received in connection with the offering and sale of the Offered Shares and will cause the Operating Partnership to use the net proceeds received in connection with the issuance and sale of the Company Preferred OP Units in the manner described in the Use of Proceeds section of the Registration Statement, the General Disclosure Package and the Prospectus, and, except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, the Company does not intend to use any of the proceeds from the sale of the Offered Shares hereunder to repay any outstanding debt owed to any affiliate of the Agent.   (xi) Absence of Manipulation. The Transaction Entities will not, and will cause each of its subsidiaries and controlled affiliates not to, take, directly or indirectly, any action designed to or that would constitute or that might cause or result in, stabilization or manipulation of the price of any securities of the Company to facilitate the sale or resale of the Offered Shares.   (xii) Listing. The Company will maintain the registration of the Offered Shares pursuant to Section 12(b) of the Exchange Act as of the Settlement Date; and the Company will cause the Offered Shares to be listed on the NYSE MKT on or prior to the Settlement Date.   (xiii) Maryland Law. The Company will use its best efforts to comply with all applicable requirements under the MGCL with respect to the Offered Shares.   (xiv) Sarbanes-Oxley Act. The Company will use its reasonable best efforts to comply with all applicable provisions of the Sarbanes-Oxley Act.   (xv) Reserved.   (xvi) Qualification and Taxation as a REIT. The Company will use its best efforts to qualify for taxation as a REIT under the Code for its taxable year ending December 31, 2016 and thereafter, unless the Board determines that it is no longer in the best interests of the Company to continue to qualify as REIT.   (xvii) Market Value. The aggregate market value of the Company's outstanding voting and nonvoting common equity computed pursuant to General Instruction I.B.1 of Form S-3 equaled or exceeded $75 million as of a date within 60 days prior to the date of filing of the Registration Statement.   (xviii) Conversion Shares. (i) Following issuance and delivery of the  Series A Preferred Stock in accordance with this Agreement, the Series A Preferred Stock will be redeemable at the option of holders of the  Series A Preferred Stock beginning October 21, 2022 as provided in Articles Supplementary, and any such redemption by a holder may be settled at the option of the Company in cash, shares of Common Stock (the Conversion Shares), or a combination of cash and shares of Common Stock in accordance with the Articles Supplementary; upon approval of the issuance of the Conversion Shares by the Board, the Conversion Shares will be duly authorized and reserved for issuance upon such conversion by all necessary corporate action and such Conversion Shares, when issued upon such redemption in accordance with the Articles Supplementary, will be validly issued and will be fully paid and non-assessable, and will conform to the description of the Common Stock contained in the General Disclosure Package and the Prospectus; (ii) no holder of the Conversion Shares will be subject to personal liability by reason of being such a holder; (iii) the issuance of such Conversion Shares upon such redemption will not be subject to the preemptive or other similar rights of any security holder of the Company; (iv) the Board will make any and all determinations concerning the future issuance of the Conversion Shares; (v) the Company will not issue Conversion Shares unless the issuance thereof will comply with all applicable laws and rules and regulations of the NYSE MKT or any exchange on which the Common Stock or Series A Preferred Stock of the Company is listed; (vi) the Company will not issue Conversion Shares, unless upon such issuance the Conversion Shares will be free of transfer restrictions under applicable law and freely tradable by non-affiliates; and (vii) the Conversion Shares will be listed, pursuant to a supplemental listing application or otherwise, on the market or exchange where the Common Stock is then registered.

  32







  (xix) Amendment of Company Organizational Documents. To the extent necessary for the holders of Series A Preferred Stock to exercise their voting rights as described in the Articles Supplementary, the Company will make all necessary amendments to its Bylaws in order to effectuate such voting rights.   (xx) Investment Company. The Company will not, and the Operating Partnership will not, be or become, at any time prior to the expiration of three years after the date of this Agreement, an investment company, as such term is defined in the Investment Company Act; provided, however, that this provision shall not be applicable and shall have no legal force or effect in the event that the Company becomes deemed an investment company solely as a result of the Commission amending, revising, rescinding or otherwise modifying the Investment Company Act, the rules and regulations promulgated thereunder or the Commission's interpretations and guidance relating thereto after the Settlement Date.   (b) The Manager agrees with the Agent that:   (i) Reporting of Material Events. The Manager agrees that, during the period when the Prospectus is required to be delivered under the Act or the Exchange Act, it shall notify the Agent and the Transaction Entities of the occurrence of any material events respecting its activities or condition, financial or otherwise, and the Manager will forthwith supply such information to the Transaction Entities as shall be necessary in the opinion of counsel to the Transaction Entities and the Agent for the Transaction Entities to prepare any necessary amendment or supplement to the Prospectus so that, as so amended or supplemented, the Prospectus will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at the time it is delivered to a purchaser, not misleading.

  33







  (ii) No Stabilization or Manipulation. Not to take, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of any securities of the Company to facilitate the sale or resale of the Offered Shares.   (iii) Investment Adviser. The Manager will not be or become, at any time prior to the expiration of three years after the date of this Agreement, an investment adviser, as such term is defined in the Investment Advisers Act of 1940, as amended (the Investment Advisers Act).   6. Free Writing Prospectuses. The Company represents and agrees that, unless it obtains the prior consent of the Agent, and the Agent represents and agrees that, unless it obtains the prior consent of the Company, it has not made and will not make any offer relating to the Offered Shares that would constitute an Issuer Free Writing Prospectus, or that would otherwise constitute a free writing prospectus, as defined in Rule 405, required to be filed with the Commission; provided, that such consent is deemed to have been given with respect to each Issuer Free Writing Prospectus identified on Schedule A hereto and any road show that is a written communication within the meaning of Rule 433(d)(8)(i) that has been reviewed and approved by the Agent. Any such free writing prospectus consented to by the Company and the Agent is hereinafter referred to as a Permitted Free Writing Prospectus. The Company represents that it has treated and agrees that it will treat each Permitted Free Writing Prospectus as an issuer free writing prospectus, as defined in Rule 433, and has complied and will comply with the requirements of Rules 164 and 433 applicable to any Permitted Free Writing Prospectus, including timely Commission filing where required, legending and record keeping. The Company represents that it has satisfied and agrees that it will satisfy the conditions in Rule 433 to avoid a requirement to file with the Commission any Bona Fide Electronic Road Show. If at any time following the issuance of a Permitted Free Writing Prospectus there occurred or occurs an event or development as a result of which such Permitted Free Writing Prospectus conflicted or would conflict with the information contained in the Registration Statement, the General Disclosure Package or the Prospectus, or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Agent and will promptly amend or supplement, at its own expense, such Permitted Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission

  34







  7. Conditions of the Obligations of the Agent. The obligations of the Agent with respect to the consummation of the transactions contemplated hereby will be subject to the accuracy of the representations and warranties of the Transaction Entities and the Manager herein (as though made on the Settlement Date), to the accuracy of the statements of the Transaction Entities and the Manager made pursuant to the provisions hereof, to the performance by the Transaction Entities and the Manager of their obligations hereunder, to all contingencies and conditions described in this Agreement having been met and to the following additional conditions precedent:   (a) Accountants' Comfort Letters and CAO Certificates.   (i) The Agent shall have received letters, dated, respectively, the date hereof and the Settlement Date, of BDO USA, LLP in a form approved by the Agent and/or Bass, Berry & Sims PLC, confirming that they are a registered public accounting firm and independent public accountants within the meaning of the Securities Laws and in form and substance satisfactory to the Agent, containing statements and information of the type ordinarily included in accountants' comfort letters with respect to financial statements and certain financial information of the Company contained in the Registration Statement, the General Disclosure Package and the Prospectus (except that, in any letter dated the Settlement Date, the specified date referred to in the letter shall be a date no more than three (3) days prior to the Settlement Date).   (ii) Should the Agent deem appropriate, the Agent shall have received a certificate, dated the date hereof, of Christopher J. Vohs, in his capacity as the Chief Accounting Officer and Principal Financial Officer of the Company, substantially in the form of Annex I-A hereto.   (b) Effectiveness of Registration Statement. If the Effective Time of an additional Registration Statement (if any) is not prior to the execution and delivery of this Agreement, such Effective Time shall have occurred not later than 5:00 P.M., New York time, on the date of this Agreement or, if earlier, the time the Prospectus is finalized and distributed to the Agent, or shall have occurred at such later time as shall have been consented to by the Agent. The Prospectus shall have been filed with the Commission in accordance with Rule 424(b) under the Act and Section 5(a) hereof. Prior to the Settlement Date, no stop order suspending the effectiveness of a Registration Statement, Statutory Prospectus or the Prospectus shall have been issued and no proceedings for that purpose shall have been instituted or, to the knowledge of the Company or the Agent, shall be contemplated by the Commission.

  35







  (c) No Material Adverse Change. Subsequent to the execution and delivery of this Agreement, there shall not have occurred (i) any change, or any development or event involving a prospective change, in the condition (financial or otherwise), results of operations, business, earnings, properties or prospects of the Transaction Entities and their respective Subsidiaries, taken as a whole, that, in the sole judgment of the Agent, is material and adverse and makes it impractical or inadvisable to market the Offered Shares; (ii) any change in either U.S. or international financial, political or economic conditions or currency exchange rates or exchange controls the effect of which is such as to make it, in the judgment of the Agent, impractical to market or to enforce contracts for the sale of the Offered Shares, whether in the primary market or in respect of dealings in the secondary market; (iii) any suspension or material limitation of trading in securities generally on the NYSE MKT, or any setting of minimum or maximum prices for trading on such exchange; (iv) or any suspension of trading of any securities of the Company on any national securities exchange or in the over-the-counter market; (v) any banking moratorium declared by any U.S. federal or New York authorities; (vi) any major disruption of settlements of securities, payment, or clearance services in the United States or any other country where such securities are listed; or (vii) any attack on, outbreak or escalation of hostilities or act of terrorism involving the United States, any declaration of war by Congress or any other national or international calamity or emergency if, in the judgment of the Agent, the effect of any such attack, outbreak, escalation, act, declaration, calamity or emergency is such as to make it impractical or inadvisable to market the Offered Shares or to enforce contracts for the sale of the Offered Shares.   (d) Opinion of Counsel for the Transaction Entities. The Agent shall have received an opinion, dated the Settlement Date, of Kaplan, Voekler, Cunningham & Frank, PLC, counsel for the Transaction Entities, substantially in the form attached hereto as Annex III-A and a letter substantially in the form attached hereto as Annex III-B.   (e) Opinion of Maryland Counsel for Company. The Agent shall have received an opinion, dated the Settlement Date, of Venable LLP, Maryland counsel for the Company, substantially in the form attached hereto as Annex IV.   (f) Tax Opinion. The Agent shall have received a tax opinion, dated the Settlement Date, of Vinson & Elkins, LLP, counsel for the Company, substantially in the form attached hereto as Annex V.   (g) Opinion of Counsel for Agent. The Agent shall have received from Bass, Berry & Sims PLC, counsel for the Agent, such opinion or opinions, dated the Settlement Date, with respect to such matters as the Agent may require. In rendering such opinion, Bass, Berry & Sims PLC, may (i) rely as to matters of fact (but not as to legal conclusions), to the extent they deem proper, on certificates of responsible officers of the Transaction Entities, their respective Subsidiaries, the Manager and of public officials and (ii) rely as to matters involving the application of the laws of the state of Maryland upon the opinion of Venable LLP.

  36







  (h) Company Officers' Certificate. The Agent shall have received a certificate, dated the Settlement Date, of the Chief Executive Officer of the Company and the Chief Accounting Officer of the Company, in his capacity as the Principal Financial Officer of the Company, in which such officers shall state that: the representations and warranties of the Transaction Entities in this Agreement are true and correct as of such date; each of the Transaction Entities has complied with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder at or prior to the Settlement Date; no stop order suspending the effectiveness of any Registration Statement has been issued and no proceedings for that purpose have been instituted or, to the best of their knowledge and after reasonable investigation, are contemplated by the Commission; the 462(b) Registration Statement (if any) satisfying the requirements of subparagraphs (1) and (3) of Rule 462(b) was timely filed pursuant to Rule 462(b), including payment of the applicable filing fee in accordance with the applicable Rules and Regulations; and, subsequent to the date of the most recent financial statements in the Registration Statement, the General Disclosure Package and the Prospectus, there has been no change, nor any development or event involving a prospective change, in the condition (financial or otherwise), results of operations, earnings, business, properties or prospects of the Transaction Entities and their respective Subsidiaries, taken as a whole, that is material and adverse, except as set forth in the Registration Statement, the General Disclosure Package and the Prospectus or as described in such certificate.   (i) Manager Officer's Certificate. The Agent shall have received a certificate, dated the Settlement Date, of the Chief Executive Officer of the Manager in which such officer shall state that: the representations and warranties of the Manager in this Agreement are true and correct as of such date and that the Manager has complied with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder at or prior to the Settlement Date.   (j) Reserved.   (k) Rule 462(b) Registration Statement. In the event that a Rule 462(b) Registration Statement is filed in connection with the offering contemplated by this Agreement, such Rule 462(b) Registration Statement shall have been filed with the Commission and shall have become effective automatically upon such filing.   (l) Company Good Standing. The Agent shall have received a certificate of good standing of the Company certified by the Maryland State Department of Assessments and Taxation as of a date within five (5) business days of the Settlement Date.   (m) Operating Partnership Good Standing. The Agent shall have received a certificate of good standing of the Operating Partnership certified by the Secretary of State of the State of Delaware as of a date within five (5) business days of the Settlement Date.

  37







  (n) Manager Good Standing. The Agent shall have received a certificate of good standing of the Manager certified by the Secretary of State of the State of Delaware as of a date within five (5) business days of the Settlement Date.   (o) Subsidiary Good Standings. The Agent shall have received a certificate of good standing certified by the Secretary of State (or equivalent governmental authority) of the state of incorporation or formation as of a date no earlier than April 15, 2016, for each entity listed on Schedule B hereto.   (p) Secretary's Certificate of the Company. The Agent shall have received a certificate of the secretary of the Company certifying resolutions of the board of directors of the Company approving the Agreement and the transactions contemplated thereby.   (q) Secretary's Certificate of the Manager. The Agent shall have received a certificate of the secretary of the Manager certifying resolutions of the Manager's managing member approving the Agreement and the transactions contemplated thereby.   (r) General Partner Certificate of the Operating Partnership. The Agent shall have received a certificate of the general partner of the Operating Partnership certifying resolutions of the Operating Partnership approving the Agreement and the transactions contemplated thereby.   (s) FINRA Approval. The Agent shall have received any required clearance letter from the Corporate Finance Department of FINRA with respect to the offering.   (t) Listing. An application for the listing of the Offered Shares shall have been approved for listing to the NYSE MKT prior to the Settlement Date.   (u) Amendment to OP Agreement. The Fourth Amendment to the OP Agreement shall be in full force and effect as of the Settlement Date.   The Transaction Entities will furnish the Agent with such conformed copies of such opinions, certificates, letters and documents as the Agent reasonably request. The Agent may in its sole discretion waive compliance with any conditions to the obligations of the Agent hereunder.

  38







  8. Indemnification and Contribution.   (a) Indemnification of Agent by the Transaction Entities. Each of the Transaction Entities will, jointly and severally, indemnify and hold harmless the Agent, its partners, members, directors, officers, employees, agents, affiliates and each person, if any, who controls the Agent within the meaning of Section 15 of the Act or Section 20 of the Exchange Act (each, an Indemnified Party), against any and all losses, claims, damages or liabilities, joint or several, to which such Indemnified Party may become subject, under the Act, the Exchange Act, other Federal or state statutory law or regulation or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in any part of any Registration Statement at any time, any Statutory Prospectus as of any time, the Prospectus or any Issuer Free Writing Prospectus, or arise out of or are based upon the omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse each Indemnified Party for any legal or other expenses reasonably incurred by such Indemnified Party in connection with investigating or defending against any loss, claim, damage, liability, action, litigation, investigation or proceeding whatsoever (whether or not such Indemnified Party is a party thereto), whether threatened or commenced, and in connection with the enforcement of this provision with respect to any of the above as such expenses are incurred; provided, however, that neither of the Transaction Entities will be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement in or omission or alleged omission from any of such documents in reliance upon and in conformity with written information furnished to the Company by the Agent specifically for use therein, it being understood and agreed that such information furnished by the Agent consists only of the information described as such in  Section 8(b) below.   (b) Indemnification of Company, Directors and Officers. The Agent will indemnify and hold harmless each of the Transaction Entities, their directors and each of their officers who signs a Registration Statement and each person, if any, who controls either of the Transaction Entities within the meaning of Section 15 of the Act or Section 20 of the Exchange Act (each, an Agent Indemnified Party), against any losses, claims, damages or liabilities to which such Agent Indemnified Party may become subject, under the Act, the Exchange Act, other Federal or state statutory law or regulation or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in any part of any Registration Statement at any time, any Statutory Prospectus as of any time, the Prospectus or any Issuer Free Writing Prospectus, or arise out of or are based upon the omission or the alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to either of the Transaction Entities by the Agent specifically for use therein, and will reimburse any legal or other expenses reasonably incurred by such Agent Indemnified Party in connection with investigating or defending against any such loss, claim, damage, liability, action, litigation, investigation or proceeding whatsoever (whether or not such Agent Indemnified Party is a party thereto), whether threatened or commenced, based upon any such untrue statement or omission, or any such alleged untrue statement or omission as such expenses are incurred, it being understood and agreed that the only such information furnished by the Agent consists of the following information in the Prospectus furnished on behalf of the Agent: the thirteenth full paragraph under the caption Plan of Distribution in the Final Prospectus Supplement and under the caption Other Relationships, in each case, only to the extent that such statements relate only to the Agent.

  39







  (c) Actions against Parties; Notification. Promptly after receipt by an indemnified party of notice of the commencement of any action against such indemnified party, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under subsections (a), (b) or (c) above, notify the indemnifying party of the commencement thereof; but the failure to notify the indemnifying party shall not relieve it from any liability that it may have under subsections (a), (b) or (c) above except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided further that the failure to notify the indemnifying party shall not relieve it from any liability that it may have to an indemnified party otherwise than under subsections (a), (b) or (c) above. In case any such action is brought against any indemnified party and it notifies the indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate therein and, to the extent that it may wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party will not be liable to such indemnified party under this Section 8(c) for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed to the contrary; (ii) the indemnifying party has failed within a reasonable time to retain counsel reasonably satisfactory to the indemnified party; (iii) the indemnified party shall have reasonably concluded that there may be legal defenses available to it that are different from or in addition to those available to the indemnifying party; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interest between them. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened action in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party unless such settlement (i) includes an unconditional release of such indemnified party from all liability on any claims that are the subject matter of such action and (ii) does not include a statement as to, or an admission of, fault, culpability or a failure to act by or on behalf of an indemnified party.   (d) Contribution. If the indemnification provided for in this Section 8 is unavailable or insufficient to hold harmless an indemnified party under subsections (a), (b) or (c) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities referred to in subsections (a), (b) or (c) above (i) in such proportion as is appropriate to reflect the relative benefits received by the Transaction Entities on the one hand and by the Agent on the other hand from the offering of the Offered Shares or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company, on the one hand, and the Agent, on the other, in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities as well as any other relevant equitable considerations. The relative benefits received by the Transaction Entities on the one hand and by the Agent on the other hand shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses) received by the Company bear to the total underwriting discounts and commissions received by the Agent. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the Agent and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this Section 8(d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim which is the subject of this Section 8(d). Notwithstanding the provisions of this Section 8(d), the Agent shall not be required to contribute any amount in excess of the amount by which the total price at which the  Series A Preferred Stock sold pursuant to this Agreement exceeds the amount of any damages which the Agent has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

  40







  9. Termination of Agency. If the Offered Shares are not sold by May 26, 2016, this Agreement will terminate without liability on the part of the Company and the Agent, except as provided in Section 10 hereof. As used in this Agreement, the term Agent includes any person substituted for the Agent under this Section 9.   10. Survival of Certain Representations and Obligations. The respective indemnities, agreements, representations, warranties and other statements of the Transaction Entities, the Manager or their respective officers and of the Agent set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation, or statement as to the results thereof, made by or on behalf of the Agent, the Transaction Entities, the Manager or any of their respective representatives, officers or directors or any controlling person, and will survive delivery of and payment for the Offered Shares. If the settlement of the Offered Shares by the Agent is not consummated for any reason other than solely because of the termination of this Agreement pursuant to Section 9 hereof, the Company will reimburse the Agent for all out-of-pocket expenses (including fees and disbursements of counsel) reasonably incurred by them in connection with the placement of the Offered Shares, and the respective obligations of the Transaction Entities and the Manager, on the one hand, and the Agent, on the other hand, pursuant to Section 8 hereof shall remain in effect. In addition, if the Offered Shares have been settled pursuant to the terms of the Agreement, the representations and warranties in Sections 2 through 3 and all obligations under Section 5 shall also remain in effect.

  41







  11. Notices. All communications hereunder will be in writing and, if sent to the Agent, will be mailed or delivered and confirmed to the Agent, with a copy to Bass, Berry & Sims PLC, 150 Third Avenue South, Suite 2800, Nashville, TN 37201, Attention: Lori B. Morgan, or, if sent to the Transaction Entities or the Manager, will be mailed or delivered and confirmed to it at c/o Bluerock Residential Growth REIT, Inc., 712 Fifth Avenue, 9th Floor, New York, NY 10019, Attention: Michael L. Konig, with a copy to Kaplan, Voekler, Cunningham & Frank, PLC, 1401 East Cary Street, Richmond, Virginia 23239, Attention: Richard P. Cunningham, Jr.   12. Successors. This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers, directors and controlling persons referred to in Section 9, and no other person will have any right or obligation hereunder.   13. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement.   14. Headings. The headings herein are inserted for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement.   15. Entire Agreement. This Agreement represents the entire agreement between the Transaction Entities and the Manager, on the one hand, and the Agent, on the other, with respect to the preparation of any Registration Statement, the General Disclosure Package, the Prospectus, the conduct of the offering, and the placement and sale of the Offered Shares.   16. Absence of Fiduciary Relationship. The Transaction Entities and the Manager each acknowledge and agree that:   (a) No Other Relationship. The Agent has been retained solely to act as a placement agent in connection with the sale of Offered Shares and that no fiduciary, advisory or agency relationship between the Transaction Entities and the Manager on the one hand, and the Agent on the other has been created in respect of any of the transactions contemplated by this Agreement or the Prospectus, irrespective of whether the Agent has advised or is advising either of the Transaction Entities or the Manager on other matters;   (b) Arms' Length Negotiations. The price of the Offered Shares set forth in this Agreement was established by the Company following discussions and arms' length negotiations with the Agent, and the Transaction Entities and Manager are capable of evaluating and understanding and understands and accepts the terms, risks and conditions of the transactions contemplated by this Agreement;

  42







  (c) Absence of Obligation to Disclose. The Transaction Entities and the Manager have been advised that the Agent and its affiliates are engaged in a broad range of transactions which may involve interests that differ from those of the Transaction Entities and the Manager, and that the Agent has no obligation to disclose such interests and transactions to Transaction Entities and the Manager by virtue of any fiduciary, advisory or agency relationship; and   (d) Waiver. Each of the Transaction Entities and the Manager waives, to the fullest extent permitted by law, any claims they may have against the Agent for breach of fiduciary duty or alleged breach of fiduciary duty and agree that the Agent shall have no liability (whether direct or indirect) to either of the Transaction Entities or the Manager in respect of such a fiduciary duty claim or to any person asserting a fiduciary duty claim on behalf of or in right of the Transaction Entities or the Manager, including stockholders, holders of membership interests, employees or creditors of the Transaction Entities or the Manager.   17. Trial by Jury. Each of the Transaction Entities and the Manager (on its behalf and, to the extent permitted by applicable law, on behalf of its stockholders and affiliates) and the Agent hereby irrevocably waives, to the fullest extent permitted by applicable law, 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.   18. Applicable Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York.   19. Jurisdiction. Each of the Transaction Entities and the Manager hereby submits to the non-exclusive jurisdiction of the Federal and state courts in the Borough of Manhattan in The City of New York in any suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby. Each of the Transaction Entities and the Manager irrevocably and unconditionally waives any objection to the laying of venue of any suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby in Federal and state courts in the Borough of Manhattan in The City of New York and irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such suit or proceeding in any such court has been brought in an inconvenient forum.   20. Termination. Until the Settlement Date, this Agreement may be terminated by the Agent by giving notice (in the manner prescribed by Section 9 hereof) to the Company, if (i) the Company shall have failed, refused or been unable, at or prior to the Settlement Date, to perform any agreement on its part to be performed hereunder unless the failure to perform any agreement is due to the default or omission by the Agent; (ii) any other condition of the obligations of the Agent hereunder is not fulfilled; (iii) trading in securities generally on the NYSE, NYSE MKT, or Nasdaq shall have been suspended or minimum or maximum prices shall have been established on either of such exchanges or such market by the Commission or by such exchange or other regulatory body or governmental authority having jurisdiction; (iv) trading or quotation in any of the Company's securities shall have been suspended or materially limited by the Commission or by the NYSE MKT, NYSE or Nasdaq or other regulatory body of governmental authority having jurisdiction; (v) a general banking moratorium has been declared by Federal or New York authorities; (vi) a material disruption in securities settlement, payment or clearance services in the United States shall have occurred; (vii) there shall have been any material adverse change in general economic, political or financial conditions in the United States or in international conditions on the financial markets in the United States, in each case, the effect of which is such as to make it, in the Agent's reasonable judgment, inadvisable to proceed with the delivery of the Securities; or (viii) any attack on, outbreak or escalation of hostilities, declaration of war or act of terrorism involving the United States or any other national or international calamity or emergency has occurred if, in the Agent's reasonable judgment, the effect of any such attack, outbreak, escalation, declaration, act, calamity or emergency makes it impractical or inadvisable to proceed with the completion of the placement or the delivery of the Securities. Any termination of this Agreement pursuant to this Section 21 shall be without liability on the part of the Company or the Agent, except as otherwise provided in Sections 5(a), 7, 8 and 9 hereof.

  43







  If the foregoing is in accordance with the Agent's understanding of our agreement, kindly sign and return to the Company one of the counterparts hereof, whereupon it will become a binding agreement among the Transaction Entities, the Manager and the Agent in accordance with its terms.     [Signature Page Follows]

  44







    Very truly yours,             BLUEROCK RESIDENTIAL GROWTH REIT, INC.                   By: /s/ R. Ramin Kamfar       Name: R. Ramin Kamfar       Title: Chief Executive Officer                     BLUEROCK RESIDENTIAL HOLDINGS, L.P.                   By: Bluerock Residential Growth REIT, Inc.     Its: General Partner                     By: /s/ R. Ramin Kamfar       Name: R. Ramin Kamfar       Title: Chief Executive Officer                     BRG MANAGER, LLC           By: Bluerock Real Estate, L.L.C.     Its: Sole Member                     By: /s/ R. Ramin Kamfar       Name: R. Ramin Kamfar       Title: Chief Executive Officer       [Signature Page to Agreement]

  45







  The foregoing Agreement is hereby confirmed and accepted as of the date first above written.   Acting on behalf of itself as the Agent     COMPASS POINT RESEARCH & TRADING, LLC               By: /s/ Christopher A. Nealon       Name: Christopher A. NealonTitle: President and Chief Operating Officer     [Signature Page to Agreement]

  46







  SCHEDULE A   None 
Question: Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?

SOLUTION: The Transaction Entities and each of their respective Subsidiaries are insured by insurers with appropriately rated claims paying abilities against such losses and risks and in such amounts as are prudent and customary for the businesses in which they are engaged; all policies of insurance and fidelity or surety bonds insuring the Transaction Entities, their respective Subsidiaries or their respective businesses, assets, employees, officers and directors are in full force and effect; neither of the Transaction Entities nor any of their respective Subsidiaries has been refused any insurance coverage sought or applied for; neither of the Transaction Entities nor any of their respective Subsidiaries has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a similar cost as currently paid, except as set forth in or contemplated in the Registration Statement, the General Disclosure Package and the Prospectus; and the Company has obtained or will obtain directors' and officers' insurance in such amounts as is customary for companies engaged in the type of business conducted by the Company.

PROBLEM: EXHIBIT 10.2

               TOUCHSTAR SOFTWARE CORPORATION RESELLER AGREEMENT                             DATED SEPTEMBER 14, 2005

                         TOUCHSTAR SOFTWARE CORPORATION

                               RESELLER AGREEMENT

         This Reseller Agreement is made and entered into as of this 14 day of SEPTEMBER, 200_ (the Effective Date), by and between TOUCHSTAR SOFTWARE CORPORATION, a Delaware corporation with its principal place of business at 3025 South Parker Road, Suite 925, Aurora, Colorado 80014, United States (TouchStar), and WORLDWIDE STRATEGIES, a NEVADA corporation, with its principal place of business at 3801-E FLORIDA AVE STE 400 DENVER, CO 80210 (Reseller).

                                    RECITALS

A. TouchStar produces and distributes the TouchStar Software and provides the related Support Services.

B. Reseller has represented to TouchStar that it possesses experience, knowledge, and skill in the calling service industry and has the capability to effectively market and distribute the TouchStar Software and Support Services in the Territory.

C. Reseller desires to market and distribute the TouchStar Software to Customers as a non-exclusive value added reseller in the Territory pursuant to the terms contained in this Agreement.

                                    AGREEMENT

         NOW, THEREFORE, in consideration of the foregoing and the mutual promises set forth in this Agreement, and intending legally to be bound hereby, the parties agree as follows:

1. DEFINITIONS.

         In addition to the terms defined elsewhere in this Agreement, the following terms shall have the meanings set forth below (such meanings to be equally applicable to the singular as well as the plural forms of the terms defined):

         AAA has the meaning ascribed to that term in Section 10.12(b) of this Agreement.

         AAA Rules has the meaning ascribed to that term in Section 10.12(b) of this Agreement.

         Affiliate as used in this Agreement with respect to an Entity, means any person controlling, controlled by or under common control with such Entity. For the purpose of this definition, control means the possession, directly or indirectly, of the power to direct or cause the direction of an Entity, whether through the ownership of voting securities or otherwise.

         Agreement means this Reseller Agreement and the Exhibits attached hereto as the same may be amended from time to time in accordance with the terms set forth herein.

Rev 3/05

         Ancillary Software has the meaning ascribed to that term in Section 4.13 of this Agreement.

         Annual Marketing Plan has the meaning ascribed to that term in Section 4.3 of this Agreement.

         Assessment has the meaning ascribed to that term in Section 6.2 of





this Agreement.

         Confidential Information means any and all trade secrets and other confidential information and know-how related directly or indirectly to TouchStar's business or its products, including inventions, materials, formulae, confidential research, technical information, technology, general know-how, patterns, specifications, systems data, equipment, operating standards and procedures, developments and improvements, computer programs, operating systems, source code, object code, middleware, firmware, information regarding projects, programs and sales, names and addresses of past and present customers, pricing data, internal procedures, systems, methods forms, manuals, financial data, price lists, customer service information, marketing information, and all other information relating to TouchStar, the TouchStar Software, Support Services, or other products or services of TouchStar that is not generally known to the public.

     &bbsp;   Copyrights means all right, title, and interest of TouchStar in and to all copyrights and rights and interests in copyrights and works protectible by copyright, whether now owned or hereafter acquired or created by TouchStar (in whole or in part) and all renewals and extensions thereof, throughout the universe and in perpetuity, whether or not registered or recorded in the United States Copyright Office or in the copyright office or agency of any other country or jurisdiction and including all works based upon, incorporated in, derived from, incorporating or relating to all works covered by copyright, including copyrights or rights or interests in copyrights registered or recorded in the United States Copyright Office or in the copyright office or agency of any other country or jurisdiction.

         Customer means a third party end-user with headquarter offices in the Territory to whom or to which Reseller resells or causes the resale of the TouchStar Software and Support Services.

         Dollars or US$ means the lawful currency of the United States.

         Effective Date has the meaning ascribed to that term in the introductory paragraph of this Agreement.

         Entity means any general partnership (including a limited liability partnership), limited partnership (including a limited liability limited partnership), limited liability company, corporation, joint venture, trust, business trust, cooperative, association or any foreign trust or foreign business organization.

         Fees means the installation fees, licensing fees and support service fees owed by Reseller to TouchStar, as set forth on EXHIBIT A.

                                       2

         Government Controls means economic and other sanctions instituted by a Governmental Body related to certain transactions, such as the transfer of technology and technical data, the transfer of funds, the provisions of goods and services, and other dealings, including, but not limited to, sanctions administered by the United States government pursuant to the United States Export Administration Act, the United States Arms Export Control Act, the International Emergency Economic Powers Act, the United States Foreign Corrupt Practices Act of 1977, all as amended, and the USA PATRIOT Act, and the regulations promulgated thereunder and certain regulations promulgated by the United States Department of Treasury.

         Governmental Body means any (a) nation, state, country, or other jurisdiction of any nature, (b) national, federal, state, local, municipal, foreign, or other government, governmental, or quasi-governmental authority of any nature (including any governmental agency, branch, department, official, or entity and any court or other tribunal), or (c) body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power of any nature.

         Intellectual Property Rights means the Confidential Information of TouchStar, the Copyrights, the Patents, and the Trademarks.

         Legal Requirements means any national, federal, state, local, municipal, foreign, international, multinational, or other administrative order, law, constitutional law, ordinance, principle of law, regulation, statute, treaty, directive or decree, including Government Controls.

         License Agreement means the license agreement to be provided to each Customer with regard to the use by such Customer of the TouchStar Software, in the form of EXHIBIT B, attached to this Agreement.

         Licenses means those software and other licenses from third parties necessary lawfully to provide the Support Services.

         Marketing Materials has the meaning ascribed to that term in Section 3.2 of this Agreement.

         Other Reseller means any person or Entity acceptable to TouchStar in its sole discretion with whom or with which Reseller enters into an Other Reseller Agreement to promote, market, distribute, license and sell the TouchStar Software and Support Services to Customers in the Territory; PROVIDED that such person or Entity shall not be an end-user of either the TouchStar Software or the Support Services.

         Other Reseller Agreement has the meaning ascribed to that term in





Section 2.2(a)(i) of this Agreement.

         Patents means (a) all right, title and interest of TouchStar in and to all applicable Letters Patent and applications for Letters Patent and the inventions described therein and any Letters Patent which may issue therefrom and which have been or may have been filed in the United States or in any other country for any such inventions or for any improvements, reissues, divisions, continuations, renewals, additions, extensions, substitutes, continuations-in-part which may be made, filed, or

                                       3

granted on any of them, including the rights to all benefits therefrom arising under the International Convention for the Protection of Industrial Property or any other international treaty affecting such rights; (b) any right, title and interest of TouchStar in any utility model, design registration, trade secret, confidential research, development and commercial information, know-how, technical information, engineering, practical information, patterns, specifications, formulae, manufacturing procedures, quality control, data and procedures, systems' data, software programs, equipment, operating standards and applications, developments, and improvements; and (c) any rights to licenses or other benefits under any Letters Patent, applications for Letters Patent and/or invention, utility model registration, design registration and inventor's certificate anywhere in the world, whether or not patentable, which are obtained by TouchStar or to which TouchStar becomes entitled during the term of this Agreement.

         Private Label Software has the meaning ascribed to that term in Section 7.2 of this Agreement.

         Quotas has the meaning ascribed to that term in Section 4.11 of this Agreement.

         Registered Leads has the meaning ascribed to that term in Section 2.6 of this Agreement.

         Reseller has the meaning ascribed to that term in the introductory paragraph of this Agreement, including its legal representatives, successors, and assigns.

         Reseller Marks has the meaning ascribed to that term in Section 7.2 of this Agreement.

         Reverse Engineer means translate, disassemble, decompile, analyze, reverse engineer or reverse program, or otherwise attempt to derive the code or programming for the TouchStar Software or the Private Label Software.

         Specifications has the meaning ascribed to that term in Section 3.4(a) of this Agreement.

         Support Services means those support services related to the TouchStar Software as described in the attached EXHIBIT C.

         Technical Prerequisites has the meaning ascribed to that term in Section 3.4(b) of this Agreement.

         Term has the meaning ascribed to that term in Section 8.1 of this Agreement.

         Territory means the geographical region described in the attached EXHIBIT D.

         TouchStar has the meaning ascribed to that term in the introductory paragraph of this Agreement, including its legal representatives, successors, and assigns.

         TouchStar Intellectual Property Rights means the Copyrights, the Patents, and the Trademarks.

                                       4

         TouchStar Software means the software necessary for the operation of call center systems which is being licensed by TouchStar pursuant to this Agreement. In the event that TouchStar develops Private Label Software for Reseller, the term TouchStar Software, when the context so requires, shall include Private Label Software.

         Trademarks means all right, title and interest of TouchStar in and to (a) all trademarks, trade names, trade styles, service marks, logos, trade dress, unpatentable designs, and designations and indicia of any kind, now existing or hereafter adopted or acquired, and all registrations and recordings thereof, including applications, registrations, and recordings in the United States Patent and Trademark Office or in any similar office or agency of the United States, any state thereof, any other country or jurisdiction or any political subdivision thereof, all whether now owned or hereafter acquired by TouchStar and all reissues, extensions, or renewals thereof, and (b) any licenses of or licensing agreements (including registered user agreements) pertaining to any of the foregoing, together with all amendments, supplements, modifications or extensions thereof.

         United States means the United States of America and its territories





and possessions.

2. APPOINTMENT OF RESELLER.

     2.1  NONEXCLUSIVE RESELLER.  Subject to applicable Legal Requirements:

            (a) TouchStar hereby appoints Reseller as its nonexclusive value-                 added reseller for the limited purposes of promoting, marketing,                 distributing, licensing and selling the TouchStar Software and                 Support Services in the Territory, and Reseller accepts the                 appointment as such. Reseller shall have the right under this                 Agreement to promote, market, distribute, license and sell the                 TouchStar Software and Support Services to Customers in the                 Territory. TouchStar reserves the right to provide the TouchStar                 Software and Support Services to other customers in the                 Territory and/or to appoint additional distributors or                 representatives in all or any part of the Territory.

     2.2  OTHER RESELLERS.  Subject to applicable Legal Requirements and to the           provisions of this Section 2.2:

            (a) Reseller may promote, market, distribute, license and sell                 TouchStar Software and Support Services in the Territory through                 Other Resellers; PROVIDED that:

                  (i)   Reseller notifies TouchStar in writing in respect of                         each Other Reseller that Reseller intends to use to                         promote, market, distribute, license and sell TouchStar                         Software and Support Services in the Territory;

                  (ii)  TouchStar approves in writing each Other Reseller that                         Reseller intends to use to promote, market, distribute,                         license and sell TouchStar Software and Support Services                         in the Territory, which approval TouchStar may grant in                         its sole discretion;

                                       5

                  (iii) Reseller enters into a binding written agreement with                         each Other Reseller (the Other Reseller Agreement),                         which Other Reseller Agreement incorporates the terms,                         conditions, duties, rights and obligations of this                         Agreement;

                  (iv)  Reseller provides to TouchStar a fully executed copy of                         each Other Reseller Agreement;

                  (v)   each Other Reseller shall promote, market, distribute,                         license and sell the TouchStar Software and the Support                         Services only in the Territory and only in accordance                         with the provisions of this Agreement, including, but                         not limited to, delivery of License Agreements to                         Customers, and compliance with Legal Requirements and                         Government Controls; and

                  (vi)  Reseller shall terminate any Other Reseller Agreement in                         the event that the Other Reseller to whom or to which                         the Other Reseller Agreement relates fails to comply                         with the terms and conditions of such Other Reseller                         Agreement or this Agreement. Any Other Reseller shall                         obtain the TouchStar Software and the Support Services                         directly from the Reseller.

            (b) Reseller shall be responsible for all actions of Other Resellers                 with regard to the promotion, marketing, distribution, licensing                 and sale of TouchStar Software. Reseller shall be liable for any                 unauthorized or illegal use of the TouchStar Software by any                 Other Reseller, including, but not limited to, any actions or                 attempts to Reverse Engineer the TouchStar Software and any                 promotion, marketing, distribution, licensing or sale of the                 TouchStar Software in violation of Government Controls or other                 Legal Requirements.

            (c) No Other Reseller shall have the right to use, copy, modify,                 alter or Reverse Engineer any TouchStar Software whatsoever, and                 Reseller shall take all necessary steps to ensure that all acts                 or any Other Reseller related in any way to the TouchStar                 Software are consistent with the terms and conditions of this                 Agreement.

     2.3  RESELLER'S OBLIGATION NOT TO COMPETE. Reseller shall not obtain the           TouchStar Software or Support Services (or any software or services           which compete with the TouchStar Software) for sale from any Entity           other than TouchStar or its authorized agents. Nothing contained in           this Agreement is intended to limit Reseller from responding to           unsolicited requests from Customers from outside of the Territory;           PROVIDED, HOWEVER, that Reseller shall (a) immediately notify           TouchStar upon receipt of any such request and (b) not seek customers           of TouchStar Software or Support Services in any other location other           than in the Territory. Reseller shall not sell TouchStar Software or           Support Services to any person or Entity outside the Territory or           within the Territory if, to Reseller's knowledge, any such person or           Entity intends to resell the TouchStar Software or Support Services           outside of the Territory. Reseller shall not import, promote,





          distribute, license, market or sell any products in

                                       6

          the Territory which directly compete with the TouchStar Software or           Support Services.

     2.4  CHANGES IN TOUCHSTAR SOFTWARE AND SUPPORT SERVICES. TouchStar shall           have the right at any time and from time to time, in its sole           discretion, (a) to change the TouchStar Software or Support Services           included within the scope of this Agreement by providing written           notice to Reseller at least thirty (30) days prior to the date the           change becomes effective and (b) to change the design, capabilities or           other characteristics of the TouchStar Software or Support Services,           or discontinue the production or marketing of all or any portion of           the TouchStar Software or Support Services, without prior notice of           any kind. Upgrades and enhancements to the TouchStar Software or           Support Services shall automatically be deemed included as TouchStar           Software or Support Services, as applicable, unless TouchStar notifies           Reseller otherwise.

     2.5  USE OF TOUCHSTAR SOFTWARE.

            (a) TouchStar hereby grants to Reseller, with the additional right                 to grant to Other Resellers who or which enter into an Other                 Reseller Agreement, the nontransferable and nonexclusive right                 and license to use one copy of the TouchStar Software as                 necessary to demonstrate the TouchStar Software to potential                 Customers in the Territory. Reseller shall not copy, modify,                 alter, Reverse Engineer or transfer, electronically or                 otherwise, any TouchStar Software.

            (b) TouchStar reserves the absolute right, without providing notice                 to Reseller, to include software code or other markings in the                 TouchStar Software (and the Private Label Software) to assist                 TouchStar in monitoring the compliance by Reseller and Other                 Resellers with their respective obligations not to copy, modify,                 alter, modify or Reverse Engineer the TouchStar Software. In                 addition, in order to protect TouchStar's rights in and to the                 TouchStar Software, THE TOUCHSTAR SOFTWARE MAY CONTAIN A                 PROPRIETARY SCHEME THAT ALLOWS TOUCHSTAR TO DISABLE USE OF THE                 TOUCHSTAR SOFTWARE BY RESELLER, ANY OTHER RESELLER, OR CUSTOMER.                 TOUCHSTAR MAY DISABLE THE TOUCHSTAR SOFTWARE IN THE EVENT THAT                 TOUCHSTAR DISCOVERS THAT RESELLER OR ANY OTHER RESELLER HAS, OR                 HAS ATTEMPTED TO, COPY, MODIFY, ALTER OR REVERSE ENGINEER THE                 TOUCHSTAR SOFTWARE.

     2.6  LEADS FOR TOUCHSTAR SOFTWARE. Reseller shall solicit orders for           TouchStar Software from potential Customers and shall submit such           leads in writing to TouchStar (the Registered Leads). No Registered           Leads shall be binding on TouchStar until accepted by TouchStar, and           TouchStar reserves the right to reject any order or to cancel the same           or any part of it after acceptance, for credit or for any other reason           whatsoever deemed by TouchStar to be sufficient. Each Registered Lead           shall include: (a) the name, address and telephone number of the           Customer; (b) a list of the TouchStar Software and Support Services to           be provided; (c) the delivery address for

                                       7

          the TouchStar Software, whether to Reseller or Customer; (d) the           proposed shipment date; and (e) a reference to this Agreement.

     2.7  LEAD TIMES. Registered Leads shall be submitted at least thirty (30)           days prior to the requested shipping date for any TouchStar Software           or Support Services.

3. TOUCHSTAR'S DUTIES.

     3.1  AVAILABILITY OF SUPPORT SERVICES. TouchStar shall use reasonable           commercial efforts to maintain or cause to be maintained the           availability of the TouchStar Software and Support Services to           Customers in the Territory.

     3.2  MARKETING AND PROMOTIONAL LITERATURE. TouchStar shall provide to           Reseller marketing presentations and other literature prepared by           TouchStar in the ordinary course of business describing the TouchStar           Software and Support Services in order to assist Reseller in the           marketing of the Support Services in the Territory (the Marketing           Materials). The Marketing Materials will contain some or all of the           Trademarks. Reseller may include its trademarks, service marks or           other logos on the Marketing Materials; provided that Reseller may not           remove, replace or otherwise modify the Trademarks included on such           Marketing Materials.

     3.3  LICENSES. TouchStar shall grant to Reseller those Licenses necessary           for Reseller to provide Support Services to Customers. TouchStar shall           charge to Reseller the cost incurred by TouchStar to obtain such           Licenses.

     3.4  INSTALLATION.





            (a) At the request and on behalf of Reseller and any Other Reseller,                 TouchStar will install call center systems at Customer                 locations; PROVIDED that (i) TouchStar and Reseller or any Other                 Reseller, as applicable, agree in writing on the configuration                 of such call center systems (the Specifications) and (ii)                 Reseller and any Other Reseller informs the Customer that                 TouchStar is installing the call center system on behalf of such                 Reseller or any Other Reseller.

            (b) TouchStar will use reasonable commercial efforts to install the                 call center system on behalf of Reseller or any Other Reseller                 in a timely fashion. However, TouchStar and Reseller or any                 Other Reseller recognize and agree that the installation of the                 call center system depends on (i) TouchStar receiving certain                 information and data from Customer, (ii) Customer providing on a                 timely basis the necessary technical prerequisites for the                 installation of the call center system, such as T-1 lines,                 cabling and workstations (the Technical Prerequisites), and                 (iii) the number and type of any change orders requested by the                 Customer during the installation of the call center system.                 TouchStar will not be responsible for any delays in the                 installation of the call center system based on whole or in part                 on (i) delays by the Customer in providing information and data                 to TouchStar required for the installation of the call center                 system, (ii) the delay or failure by the Customer

                                       8

                to provide the Technical prerequisites, and (iii) any change                 orders requested with regard to the call center system.

4. RESELLER'S DUTIES.

     4.1  TECHNICAL AND SALES CAPABILITIES. Reseller acknowledges that the           proper marketing and support of the TouchStar Software and Support           Services requires substantial expertise and commitment. Reseller shall           at all times during the term of this Agreement, at its expense,           maintain the ability (a) to provide competent and adequate technical           assistance, service and support, (b) to explain in detail to its           Customers the features and capabilities of the Support Services, (c)           to assist Customers in determining which configuration of the Support           Services will best meet their particular needs and desires, and (d)           otherwise to carry out its obligations under this Agreement.

     4.2  DISTRIBUTION OF TOUCHSTAR SOFTWARE AND SUPPORT SERVICES. Reseller           shall use its best endeavors to vigorously promote and resell the           TouchStar Software and Support Services within the Territory.

     4.3  MARKETING PLAN. Reseller shall be responsible for developing and           implementing an annual marketing plan and system for reselling the           TouchStar Software and the Support Services (the Annual Marketing           Plan), which Annual Marketing Plan shall, prior to any use by           Reseller, be approved by TouchStar. The Annual Marketing Plan shall be           submitted to TouchStar no later than thirty (30) days after the           Effective Date.

     4.4  MARKETING PRACTICES. Reseller shall at all times conduct its business           in a manner that reflects favorably on the TouchStar Software, the           Support Services and upon TouchStar's name, goodwill, and reputation.           Reseller shall demonstrate and otherwise represent the TouchStar           Software and the Support Services fairly in comparison with           competitive products and shall not make any false or misleading           comparisons or representations regarding the TouchStar Software or the           Support Services or any representations relating to the TouchStar           Software or the Support Services that are inconsistent with           TouchStar's product literature, or warranties. Reseller shall not           engage in any illegal, deceptive, misleading, or unethical practices           that may be detrimental to TouchStar.

     4.5  PRODUCT LITERATURE. Subject to the provisions of Section 3.2, Reseller        &bbsp;  shall have the right to use and distribute the Marketing Literature to           Customers. In the event Reseller desires to use, in connection with           sales of the Support Services, any literature, technical data, price           lists, promotional materials, or similar materials (including, for           example, any materials written in any language other than English)           other than the Marketing Materials, Reseller shall prepare such           materials at its expense. All such materials shall be submitted to           TouchStar for approval, and Reseller shall not use, in connection with           the sale of the Support Services, any materials that have not been           prepared or approved by TouchStar.

     4.6  CUSTOMER ASSISTANCE. Reseller, at its expense, shall provide           assistance to its Customers in connection with the TouchStar Software           and Support Services,

                                       9

          including installation assistance, direction regarding the operation           of the TouchStar Software and Support Services, and other similar           assistance.

     4.7  SOFTWARE LICENSE AGREEMENT. Reseller and each Other Reseller shall





          deliver to each Customer a copy of the License Agreement. TouchStar           shall have the right to modify the terms and conditions of the License           Agreement from time to time, in the sole discretion of TouchStar. Upon           request from TouchStar, Reseller and each Other Reseller shall deliver           the License Agreement prior to delivery of the TouchStar Software and           Support Services. Reseller shall provide TouchStar with the name and           address of each Customer who or which receives a copy of the License           Agreement, whether from Reseller or from an Other Reseller.

     4.8  REPORTS, FORECASTS. As frequently as TouchStar reasonably requests           (but in no event less than quarterly), Reseller shall provide to           TouchStar written reports showing (a) Reseller's current Customers for           TouchStar Software and Support Services, (b) forecasts of Reseller's           anticipated orders for TouchStar Software and Support Services, and           (c) any other information regarding the TouchStar Software and Support           Services and the resale of TouchStar Software and Support Services           that TouchStar reasonably requests. All expenses associated with such           written reports shall be borne by Reseller.

     4.9  NOTIFICATION. Reseller shall report promptly to TouchStar concerning           any market information that comes to Reseller's attention regarding           TouchStar, the TouchStar Software or the Support Services, including           information regarding TouchStar's market position and the           competitiveness of the TouchStar Software or the Support Services in           the marketplace. Reseller shall report promptly to TouchStar all           claimed or suspected defects in the TouchStar Software or Support           Services and shall notify TouchStar in writing of any claim or           proceeding involving the TouchStar Software or Support Services within           five (5) days after Reseller learns of the claim or proceeding.

     4.10 COMPLIANCE WITH LAWS. Reseller and each Other Reseller shall conduct           its business in compliance with all applicable laws and regulations in           any way related to the Support Services, and performance of Reseller's           duties under this Agreement. Without limiting the generality of the           foregoing, Reseller shall:

            (a) Comply with all applicable international, national, regional and                 local laws and rules in and of the Territory now in effect or                 hereafter enacted or issued relating to the TouchStar Software                 and the Support Services;

            (b) Comply with any requirement for the registration or recording of                 this Agreement with any Governmental Body in the Territory;

            (c) Give proper weight and consideration to the interests of                 TouchStar in all dealings;

            (d) Comply at all times, and cause persons under its control to                 comply at all times, with any and all Government Controls and                 other Legal Requirements;

                                       10

            (e) Refrain from any action or omission which will cause TouchStar                 to be in violation of any law of any jurisdiction in the                 Territory or of any other Legal Requirement, including                 Government Controls.

     4.11 PERFORMANCE QUOTAS. Each Annual Marketing Plan developed by Reseller           during the term of this Agreement and any extension thereof shall           contain quotas mutually agreed between TouchStar and Reseller for the           sale by Reseller of TouchStar Software and Support Services in the           Territory for the year to which such Annual Marketing Plan relates           (the Quotas). Reseller acknowledges that meeting the Quotas is an           essential element of this Agreement and that this Agreement may be           terminated by TouchStar if, in TouchStar's reasonable opinion,           Reseller will not meet the Quotas during the Term or any extension           thereof.

     4.12 INSURANCE. At a minimum, Reseller will subscribe for and maintain           during the Term and for a period of two (2) years thereafter,           commercial general liability insurance and errors and omission           insurance in minimum amounts of Two Million Dollars (US$2,000,000) per           occurrence. Reseller will cause its insurance agent or broker to issue           and deliver to TouchStar certified copies of certificates evidencing           that insurance coverage of the required types and limits are in full           force and effect. Reseller will ensure that any persons or entities           engaged by or employed by it will carry and maintain such insurance           coverage. Each policy will include a provision requiring notice to the           other party at least thirty (30) days prior to any cancellation,           non-renewal, or material modification of the policy and will require           that each policy will name TouchStar as an additional insured.

     4.13 ANCILLARY SOFTWARE. Reseller shall have the right to develop ancillary           software compatible with the TouchStar Software for the use of its           Customers, including, but not limited to translations of the TouchStar           Software for use in languages other than English (the Ancillary           Software). In the event Reseller decides to develop Ancillary           Software, Reseller shall give TouchStar thirty (30) days notice of its           intent to develop the Ancillary Software. TouchStar, at its sole           discretion may decide to assist with the development of the Ancillary           Software. TouchStar shall own all Ancillary Software.





     4.14 TECHNICAL PREREQUISITES. In the event that TouchStar installs call           center systems on behalf of Reseller, Reseller shall provide to           TouchStar any and all information on Technical Prerequisites           reasonably requested by TouchStar in order to assist TouchStar in the           installation of the applicable call center system.

     4.15 COVENANT NOT TO SOLICIT. During the Term, and for a period of one year           following the termination or expiration of this Agreement, Reseller           will not, directly or indirectly, make an offer of employment to any           current employee of TouchStar or otherwise encourage or solicit any           current employee of TouchStar to leave the employ of TouchStar for any           reason, or to devote less than all of such employee's efforts to the           affairs of TouchStar, without (a) the prior written agreement of           TouchStar, which TouchStar may grant in its sole discretion, and (b)           the payment by Reseller to TouchStar of a mutually agreeable severance           fee. Reseller will not make an offer of

                                       11

          employment to any former employee of TouchStar for a period of four           (4) months after such employee leaves the employ of TouchStar. In the           event that a court of competent jurisdiction refuses to enforce all or           any portion of this Section 4.15, then such unenforceable portion will           be eliminated or modified, but only to the extent necessary to permit           the remaining portion of this Section 4.15 to be enforced. In the           event that any provisions of this Section 4.15 are deemed to exceed           the time, geographic or scope limitations permitted by applicable law,           such provisions will be reformed to the maximum time, geographic or           scope limitations, as the case may be, permitted by applicable law.

5. TECHNICAL ASSISTANCE.

     5.1  TOUCHSTAR SOFTWARE INFORMATION. TouchStar shall make available to           Reseller in English such technical information relating to the           TouchStar Software as it makes available to its other Resellers           generally. Reseller is not entitled to receive any source code or           other technical information relating to the TouchStar Software.

     5.2  UPGRADE OF RESELLER'S CUSTOMERS. Reseller shall use reasonable           commercial efforts to upgrade the software used by its Customers prior           to the Effective Date to the TouchStar Software. At Reseller's           request, TouchStar shall provide to Reseller and its employees           assistance relating to the upgrade of software used by Reseller's           Customers as of the Effective Date.

     5.3  ADDITIONAL ASSISTANCE. TouchStar shall provide to Reseller, the Other           Resellers, and its and their employees assistance relating to the           TouchStar Software as reasonably requested by Reseller, but in any           event in an amount not to exceed twenty (20) hours of assistance per           month. In the event TouchStar provides assistance to Reseller related           to technical aspects of the TouchStar Software or related to the           preparation of literature, technical aspects of the TouchStar Software           or related to the preparation of literature, technical materials or           promotional materials, Reseller shall promptly reimburse TouchStar for           any out-of-pocket expenses incurred by TouchStar in connection with           rendering such assistance, including all travel expenses, lodging, and           meals. TouchStar may also charge reasonably hourly or per diem rates           for some or all of the services rendered under this provision,           provided that TouchStar notifies Reseller before the services are           rendered of the rates that will apply to the services. Nothing in this           Section 5.3 shall be construed to obligate TouchStar to provide           assistance of any kind to Reseller. In the event TouchStar agrees to           provide assistance, the assistance shall at all times be subject to           the availability of TouchStar's personnel.

6. TERMS AND CONDITIONS OF SALE.

     6.1  PRICE AND PAYMENT.

            (a) TouchStar shall sell the TouchStar Software and Support                 Services, and provide for the installation of call center                 systems, for the Fees. The Fees shall be valid only for                 TouchStar Software and Support Services sold by Reseller or                 Other Resellers to Customers, and the installation of call                 center systems on

                                       12

                behalf of Reseller and any Other Resellers at Customer                 locations, in the Territory during the Term. TouchStar shall                 have the right at any time and from time to time to change the                 Fees by providing to Reseller written notice at least thirty                 (30) days prior to the date the change becomes effective.                 TouchStar may change the Fees from time to time in its sole                 discretion; PROVIDED, HOWEVER, that new Fees shall not apply to                 any agreement to provide Support Services accepted by TouchStar                 before Reseller receives notice of the change.

            (b) TouchStar will invoice Reseller for payment of the Fee incurred                 within ten (10) days after the end of each billable month.





                Payment of the Fees shall be due and payable within ten (10)                 days of the date of the invoice. All or any portion of the Fees                 not paid when due shall bear interest at the rate of one and                 one-half (1.5%) per month, calculated from the date such payment                 is due until the date on which such payment is made, inclusive;                 PROVIDED, HOWEVER, that if such interest rate exceeds the amount                 allowed by applicable law, then the interest rate shall be                 adjusted to reflect the maximum amount allowed by such                 applicable law.

     6.2  ASSESSMENTS. Reseller shall pay when due, and indemnify and hold           TouchStar harmless from any and all taxes, value added taxes, general           service taxes, duties, assessments and other fees associated with the           providing by Reseller of the TouchStar Software and the Support           Services, and the installation of call center systems on behalf of           Reseller, to Customers in the Territory pursuant to this Agreement           (Assessments). If Reseller fails to pay any Assessments when due,           and TouchStar receives any Assessment from any Governmental Body, then           TouchStar shall give written notice of the Assessment to Reseller.           Failure by Reseller immediately to pay such Assessment may, in           TouchStar's sole discretion, result in the immediate termination of           this Agreement.

     6.3  OTHER TERMS AND CONDITIONS. The terms and conditions of this Agreement           and of the applicable TouchStar invoice or confirmation shall apply to           all TouchStar Software and Support Services, and the installation of           call center systems, provided by TouchStar under this Agreement. Terms           in Reseller's purchase orders and other printed forms shall not apply           to any order, notwithstanding TouchStar's acknowledgment or acceptance           of the order. In the event of any conflict between the terms of this           Agreement and any standard forms of either TouchStar or Reseller, the           terms of this Agreement shall govern. Reseller shall not, and is not           authorized to, make any warranties as to the TouchStar Software and           Support Services, or with regard to the installation of call center           systems by TouchStar, and any warranties exceeding the scope of           TouchStar warranties shall be null and void, subject only to contrary           legal requirements applicable to the Territory.

     6.4  LIMITED WARRANTY. TouchStar warrants that (a) with regard to the           TouchStar Software, (i) TouchStar will convey good title to the           TouchStar Software free and clear of any claims, liens, security           agreements or other encumbrances and (ii) for a period of ninety (90)           days after delivery, the TouchStar Software will perform in all

                                       13

          material respects with the specifications contained in TouchStar's           technical literature with regard to the TouchStar Software, (b) the           Support Services will be provided in a good and workmanlike manner           consistent with industry practices, and (c) with regard to call center           systems installed by TouchStar, (i) TouchStar will convey good title           to the call center system free and clear of any claims, liens,           security agreements or other encumbrances and (ii) the call center           system will be installed in a good and workmanlike manner           substantially in conformance with the Specifications. EXCEPT AS           PROVIDED IN THIS SECTION 6.4, TOUCHSTAR DOES NOT WARRANT THE TOUCHSTAR           SOFTWARE OR SUPPORT SERVICES, OR THE INSTALLATION OF ANY CALL CENTER           SYSTEM, TO RESELLER, ANY OTHER RESELLER OR ANY CUSTOMER. TOUCHSTAR           MAKES NO OTHER WARRANTIES, EXPRESS OR IMPLIED, RELATING THERETO.           TOUCHSTAR IS UNAWARE OF THE USE OF ANY CALL CENTER SYSTEM INSTALLED&bbsp;BY           TOUCHSTAR. TOUCHSTAR MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND           WHATSOEVER WITH REGARD TO THE USE OF ANY CALL CENTER SYSTEM, INCLUIDNG           WHETHER THE USE OF THE CALL CENTER SYSTEM CONFORMS TO APPLICABLE           FEDERAL, STATE AND LOCAL LAWS. RESELLER BEARS SOLE RESPONSIBILITY TO           DETERMINE WHETHER THE USE OF A CALL CENTER SYSTEM BY A CUSTOMER           COMPLIES WITH APPLICABLE FEDERAL STATE AND LOCAL LAWS. SHOULD           APPLICABLE LAW NOT PERMIT THE FOREGOING EXCLUSION OF EXPRESS OR           IMPLIED WARRANTIES, THEN TOUCHSTAR HEREBY GRANTS THE MINIMUM EXPRESS           AND IMPLIED WARRANTIES REQUIRED BY SUCH APPLICABLE LAW.

     6.5  LIMITATION OF LIABILITY. IN NO EVENT SHALL TOUCHSTAR BE LIABLE TO           RESELLER, ANY OTHER RESELLER OR ANY CUSTOMER BY REASON OF ANY           REPRESENTATION OR IMPLIED WARRANTY, CONDITION, OTHER TERM, OR ANY DUTY           AT COMMON LAW, OR UNDER THE TERMS OF THIS AGREEMENT, FOR ANY DIRECT,           INDIRECT, SPECIAL, CONSEQUENTIAL OR PUNITIVE LOSS OR DAMAGE (WHETHER           FOR LOSS OF PROFIT OR OTHERWISE) ARISING OUT OF OR IN CONNECTION WITH           ANY ACT OR OMISSION OF TOUCHSTAR RELATING TO THE DEVELOPMENT,           MANUFACTURE, OR SUPPLY OF THE TOUCHSTAR SOFTWARE, THE SERVICES, OR THE           INSTALLATION OF ANY CALL CENTER SYSTEM, THEIR RESALE BY RESELLER, OR           THEIR USE BY ANY CUSTOMER OR OTHER END USER. TOUCHSTAR SHALL NOT BE           LIABLE FOR THE PROVISION OF SERVICES BY RESELLER OR ANY OTHER           RESELLER, OR ANY ALTERATIONS OR MODIFICATIONS BY RESELLER TO THE           TOUCHSTAR SOFTWARE OR ANY CALL CENTER SYSTEM. THE SOLE OBLIGATION OF           TOUCHSTAR, AND THE SOLE REMEDY OF RESELLER OR ANY OTHER RESELLER,           UNDER THIS AGREEMENT SHALL BE (A) WITH REGARD TO THE TOUCHSTAR           SOFTWARE OR ANY CALL CENTER SYSTEM, THE REPLACEMENT OR REPAIR OF THE           TOUCHSTAR SOFTWARE OR THE CALL CENTER SYSTEM OR, AT THE OPTION OF           TOUCHSTAR, THE RETURN OF THE PURCHASE PRICE PAID BY RESELLER

                                       14

          FOR SUCH TOUCHSTAR SOFTWARE OR CALL CENTER SYSTEM AND (B) WITH REGARD





          TO SERVICES, THE REPERFORMANCE OF THE SERVICES.

7. INTELLECTUAL PROPERTY RIGHTS.

     7.1  OWNERSHIP OF INTELLECTUAL PROPERTY.

            (a) Reseller acknowledges that TouchStar owns or has rights to                 license the intellectual property and proprietary rights in, to,                 and relating to the TouchStar Software and Support Services,                 including, but not limited to, the Intellectual Property Rights.

            (b) To the extent that Reseller or any Other Reseller is deemed to                 be the owner of all or any portion of the TouchStar Software,                 any Intellectual Property Rights of TouchStar or any Ancillary                 Software, or any improvements or intellectual property rights                 related thereto pursuant to applicable law, Reseller (i) hereby                 assigns exclusively to TouchStar all rights of Reseller in and                 to such Software and any improvements and intellectual property                 rights related thereto royalty-free and exclusively and (ii)                 shall include in any Other Reseller Agreement provision by which                 any Other Reseller grants to TouchStar an exclusive, perpetual,                 irrevocable, royalty-free assignment of all deemed rights of                 such Other Reseller in and to such TouchStar Software, Ancillary                 Software and Intellectual Property Rights. Reseller shall                 execute, and shall cause any Other Reseller to execute, any such                 documents and instruments necessary to vest in TouchStar the                 deemed ownership rights of Reseller or Other Reseller in and to                 any TouchStar Software, Ancillary Software or Intellectual                 Property Rights, and any improvements or intellectual property                 rights related thereto.

     7.2  PRIVATE LABELING. At the request of Reseller, TouchStar shall use           reasonable commercial efforts to provide a private label version of           the TouchStar Software (the Private Label Software) using logos,           trademarks, trade names or service marks owned by Reseller or to which           Reseller has exclusive rights (the Reseller Marks). Reseller           represents and warrants that Reseller has valid legal ownership and           other exclusive rights to the Reseller Marks. Reseller grants to           TouchStar a right and license to use the Reseller Marks in the           preparation of the Private Label Software. Reseller shall have the           right to promote, market, distribute and resell the Private Label           Software pursuant to the terms and conditions of this Agreement.           Reseller shall reimburse TouchStar for all costs and expenses incurred           by TouchStar in making the Private Label Software available to           Reseller. Except for the Reseller Marks, TouchStar shall retain all           right, title and interest in and to the Private Label Software.           Reseller shall indemnify, defend and hold harmless TouchStar, its           Affiliates, and its and their respective directors, officers,           employees, agents and representatives from and against any and all           claims, suits, proceedings, costs and expenses arising out of or           relating to the use by TouchStar of the Reseller Marks. TouchStar may           include in the Private Label Software a legend to the effect that           TouchStar owns the Private Label Software.

                                       15

     7.3  USE OF TOUCHSTAR INTELLECTUAL PROPERTY RIGHTS. Reseller shall use the           Intellectual Property Rights only to refer to the TouchStar Software           in accordance with TouchStar's policies as announced from time to           time. In particular, and without limitation, Reseller shall not (a)           remove Trademarks from any Marketing Materials, (b) include any           Trademarks or other Intellectual Property Rights in any promotional           literature prepared by Reseller without the express written consent of           TouchStar; (c) dispute or deny the validity of any of the Intellectual           Property Rights (including any attempt to register or record the same           in any jurisdiction), (d) do any act or omit to do any act whereby           TouchStar's right, title, and interest in the Intellectual Property           Rights may become invalidated or otherwise adversely affected, (e)           alter, remove, destroy, conceal, or tamper with any Trademarks, (f)           use any Intellectual Property Rights in any way which might prejudice           their distinctiveness or validity or goodwill of TouchStar therein,           (g) use in relation to Support Services any patents, copyrights,           trademarks, or trade names other than the Intellectual Property Rights           without TouchStar's prior written consent, or (h) use in the Territory           any trademarks or trade names so resembling any Trademark of TouchStar           as to be likely to cause confusion or deception. Upon expiration or           termination of this Agreement, Reseller shall immediately cease all           use of the Intellectual Property Rights and shall not thereafter use           any of them or any intellectual property rights confusingly similar to           the Intellectual Property Rights.

     7.4  USE OF CONFIDENTIAL INFORMATION. Reseller acknowledges that it may           receive, during the term of this Agreement, certain Confidential           Information belonging to TouchStar. Reseller recognizes that such           Confidential Information is proprietary to TouchStar and very           valuable, having involved the expenditure of substantial amounts of           money and the use of skilled experts over a long period of time.           Reseller shall hold TouchStar's Confidential Information in strict           confidence and shall not use or disclose any Confidential Information,           or permit any person to examine or copy any Confidential Information,           regardless of the manner in which Reseller gained access to it, except           as necessary for the performance of Reseller's obligations under this           Agreement.





     7.5  PROTECTION OF CONFIDENTIAL INFORMATION. Reseller shall protect           TouchStar's Confidential Information with the utmost care and shall           cause its employees, agents, and independent contractors having access           to such Confidential Information to sign confidentiality agreements           requiring them to comply with all the terms of this Article 7.

     7.6  INFRINGEMENT CLAIMS. Reseller shall promptly notify TouchStar of any           known or suspected breach of the Intellectual Property Rights and           shall cooperate (without charge for personal time incurred) in           TouchStar's efforts to protect such TouchStar Intellectual Property           Rights. TouchStar shall defend any action brought against Reseller           based on an allegation that any TouchStar Software infringes a United           States or foreign Patent, Copyright, or Trademark, and TouchStar shall           pay all costs and damages made in settlement or awarded as a result of           any such action. If a final injunction shall be obtained in any such           action restraining use of the TouchStar Software by any Customer, or           if TouchStar believes that any TouchStar Software is

                                       16

          likely to become the subject of a claim of infringement, TouchStar           shall, at its option and at its expense, (a) procure for Reseller's           Customer the right to continue using the TouchStar Software, (b)           replace or modify the TouchStar Software so that it becomes           non-infringing, or (c) repurchase the TouchStar Software on a           depreciated (five-year straight line) basis. Notwithstanding the           foregoing, TouchStar shall have no obligation with respect to any           action brought against Reseller based on an allegation of Patent,           Copyright, or Trademark infringement unless TouchStar is promptly           notified by Reseller in writing of such action and is allowed complete           control of the defense of such action and all negotiations for its           settlement or compromise. This Section 7.6 states TouchStar's entire           liability with respect to infringement of Patents, Copyrights, or           Trademarks.

     7.7  EQUITABLE REMEDIES. Reseller acknowledges that TouchStar will be           irreparably harmed by any breach of the provisions of this Section 7.           Therefore, in addition to any other remedies that TouchStar may have,           TouchStar shall be entitled to an injunction, issued by any court of           competent jurisdiction, wherever located, restraining any violation of           this Section 7 or specified performance if applicable. Reseller hereby           waives, with respect to any future dispute related to this Section 7,           any defense based on the argument that TouchStar will not be           irreparably harmed by a breach or that TouchStar has available to it           an adequate remedy for damages.

     7.8  RESELLER'S OBLIGATIONS AS TO CONFIDENTIAL INFORMATION AFTER           TERMINATION. All obligations of Reseller relating to TouchStar           Confidential Information shall survive the expiration or termination           of this Agreement. Promptly upon expiration or termination of this           Agreement, Reseller shall not have a right of retention with respect           to, and shall return to TouchStar, all materials in Reseller's           possession or control that represent or contain Confidential           Information, including all memoranda, computer programs, documents,           notes, and every other medium. Reseller shall not retain for its own           use or the use of any third party any such materials or any copies           thereof.

8. TERM AND TERMINATION.

     8.1  TERM OF AGREEMENT. This Agreement shall continue in force for a term           of twelve (12) months from the Effective Date, unless terminated           earlier under the provisions of this Article 8 (the Term); PROVIDED           that TouchStar shall have the right to terminate this Agreement at any           time after the Effective Date upon not less than fifteen (15) days'           prior written notice to Reseller. Prior to the end of the Term, each           of TouchStar and Reseller may notify the other if it desires to           negotiate a further agreement by written request received at least           ninety (90) days in advance of the termination of this Agreement. If           both parties desire to negotiate a further agreement, they may           consider the terms of this Agreement in coming to an understanding.           Nothing in this Agreement shall be construed to obligate either party           to renew or extend the term of this Agreement. Renewals for additional           terms, if any, shall not cause this Agreement to be construed as an           agreement of indefinite duration.

     8.2  TERMINATION AT TOUCHSTAR OPTION. TouchStar may terminate this           Agreement upon the occurrence and continuation of any of the following           events, with the understanding

                                       17

          that, if no cure period specifically is stated with regard to an           event, then no cure period for such event applies:

            (a) Reseller fails to make any payment of Fees due to TouchStar                 under this Agreement and such failure remains unremedied for a                 period of ten (10) days;

            (b) Reseller breaches any of its other obligations under this                 Agreement and such breach remains unremedied for a period of





                thirty (30) days;

            (c) Reseller or any Other Reseller takes any action to Reverse                 Engineer the TouchStar Software;

            (d) Reseller fails to comply with applicable Legal Requirements,                 including Government Controls;

            (e) Reseller fails to reach the Quotas established by the parties;

            (f) Reseller repeatedly breaches any of its obligations under this                 Agreement, even though Reseller remedies each such breach within                 the applicable time period specified above;

            (g) Reseller fails to execute an Other Reseller Agreement with any                 Other Reseller;

            (h) Reseller or any Other Reseller fails to deliver a License                 Agreement to a Customer;

            (i) Reseller fails to indemnify TouchStar, its Affiliates and its                 and their respective directors, officers, employees, agents and                 representatives for any claims related to or arising under any                 Other Reseller Agreement or the use by TouchStar of the Reseller                 Marks;

            (j) Reseller is negligent in the fulfillment of its obligations to                 market and resell the TouchStar Software;

            (k) Reseller breaches any of its obligations relating to the                 Intellectual Property Rights or Confidential Information;

            (l) Reseller, any of Reseller's officers, directors, or                 shareholders, or any entity controlling, controlled by or under                 common control with Reseller promotes, sells, or offers for sale                 any product or other item that is, in TouchStar's reasonable                 opinion, competitive with or capable of being substituted for                 any of the TouchStar Software; or Reseller engages in overt or                 subvert forms of boycott of the TouchStar Software, including                 the offer for sale of any product or other item that is, in                 TouchStar's reasonable opinion, competitive with or capable of                 being substituted for any of the TouchStar Software;

            (m) In the event of a sale, conveyance, transfer or other                 disposition, in any transaction or series of transactions that                 results, directly or indirectly, in a

                                       18

                change of fifty percent (50%) or more of the aggregate voting                 power in Reseller as such existed on and as of the Effective                 Date;

            (n) Reseller is merged or consolidated with any other entity or                 there is a substantial change in the management or control of                 Reseller; or

            (o) Reseller ceases to function as a going concern or ceases to                 conduct its operations in the normal course of business or any                 of its directors, shareholders, or officers is convicted of a                 criminal offense or engages in any other act that in TouchStar's                 opinion could have an adverse effect upon TouchStar's reputation                 and goodwill.

     8.3  SUSPENSION OF TOUCHSTAR OBLIGATIONS. Immediately upon the occurrence           of any breach by Reseller of any of its obligations under this           Agreement or upon the occurrence of any event or circumstance           identified in Section 7.3 of this Agreement, all of TouchStar's           obligations to provide Support Services shall be suspended and such           obligations shall remain suspended until the event or circumstance           giving rise to the suspension has been corrected to TouchStar's           satisfaction.

     8.4  SURVIVAL OF RESELLER OBLIGATIONS. The termination of this Agreement           shall not terminate or affect the continuing binding obligations           imposed by Sections 4.4, 4.7, 4.10, 4.12, and 5, 6, 7, 8, 9 and 10           this Agreement. It is understood and agreed that the obligations of           Reseller set forth in such provisions may be specifically enforced by           TouchStar in any court of competent jurisdiction, wherever located,           notwithstanding the provisions of Section 10.12(b) hereof, since no           other adequate remedy may exist in the event of a breach or threatened           breach by Reseller of any such provisions.

9. DUTIES UPON TERMINATION.

         In addition to any other provision of this Agreement which is designated in Section 8.6 as a provision surviving termination, the following shall apply:

     9.1  CUSTOMER AGREEMENTS.

            (a) In the event that (i) TouchStar terminates this Agreement in                 accordance with any one or more of the provisions of Section 8.2                 or (ii) Reseller elects not to enter into a new agreement with





                TouchStar pursuant to Section 8.1, all Customer Agreements with                 Customers shall be transferred by Reseller to TouchStar.

            (b) In the event that (i) TouchStar elects not to enter into a new                 agreement with Reseller pursuant to Section 8.2 or (ii) Reseller                 terminates this Agreement in accordance with the provisions of                 Section 8.3, Reseller shall retain all Customer Agreements with                 Customers and TouchStar shall continue to provide Support                 Services under such Customer Agreements for the remaining term                 of such Customer Agreements.

&bbsp;                                      19

     9.2  REFERRALS BY RESELLER. In the event that (a) TouchStar terminates this           Agreement in accordance with any one or more of the provisions of           Section 8.2 or (b) Reseller elects not to enter into a new agreement           with TouchStar pursuant to Section 8.1, Reseller shall refer to           TouchStar or TouchStar's designee all inquiries and orders received by           Reseller pertaining to the purchase of Support Services.

     9.3  PAYMENT OF FEES.

            (a) In the event that this Agreement terminates or expires pursuant                 to Section 8.1(a), Reseller immediately shall pay to TouchStar                 all Fees outstanding on and as of the date of termination or                 expiration of this Agreement.

            (b) In the event that this Agreement terminates or expires pursuant                 to Section 8.1(b), Reseller shall continue to pay all Fees in                 accordance with the provisions of Section 6.2.

     9.4  INTELLECTUAL PROPERTY RIGHTS. Reseller immediately shall stop the use           of Marketing Materials and Intellectual Property Rights, and shall           return any unused Marketing Materials and all physical media upon           which Intellectual Property Rights are contained by TouchStar.

     9.5  SHIPMENTS FOLLOWING NOTICE OF TERMINATION. The expiration or           termination of this Agreement shall not relieve TouchStar of its           continuing obligation to ship TouchStar Software pursuant to any           purchase orders accepted by TouchStar prior to the notice of           termination, nor shall it relieve Reseller of its continuing           obligation to accept and pay for such TouchStar Software; PROVIDED,           HOWEVER, that with respect to all TouchStar Software shipped after any           notice of termination, Reseller shall make payment prior to shipment           on terms and conditions and by means satisfactory to TouchStar,           notwithstanding any credit terms that may have been available to           Reseller prior to such notice of termination.

     9.6  LIABILITY UPON TERMINATION. TouchStar shall have no liability to           Reseller or any Other Reseller by reason of the termination or           expiration of this Agreement for compensation, reimbursement, or           damages of any kind, including any loss of prospective profits on           anticipated sales, loss of goodwill, or investments made in reliance           on this Agreement. Reseller acknowledges that it has received no           assurances from TouchStar that its business relationship with           TouchStar will continue beyond the term established in this Agreement,           or that it will obtain any anticipated amounts of profits in           connection with this Agreement, or that it will recoup its investment           in the promotion of the TouchStar Software. Reseller also acknowledges           that Reseller's failure to reach the Quotas will have a significant           adverse impact on TouchStar's goodwill in the Territory, and that if           Reseller is terminated because of failure to meet the Quotas, then           Reseller will not be entitled to compensation of any kind (beyond the           notice period set forth in this Agreement), since the damage to      &sbsp;    TouchStar's goodwill is likely to be at least as great as any losses           Reseller might incur as a result of the termination. However, these           provisions apply only to damages that are attributable to the           expiration or termination of this Agreement and shall not affect any           amount due

                                       20

          under this Agreement or the right of either party to seek damages           directly attributable to any breach.

10. GENERAL PROVISIONS.

     10.1 RELATIONSHIP BETWEEN THE PARTIES. Neither party to this Agreement and           none of their respective agents, employees, representatives or           independent contractors shall (a) be considered an agent, employee, or           representative of the other party for any purpose whatsoever, (b) have           any authority to make any agreement or commitment for the other party           or to incur liability or obligation in the other party's name or on           its behalf, or (c) represent to third parties that any of them has any           right so to bind the other party hereto, it being intended that each           party shall remain an independent contractor responsible only for its           own actions. Nothing contained in this Agreement shall be construed or           interpreted as creating an agency, partnership, or joint venture           relationship between the parties.





     10.2 RESELLER REPRESENTATION, WARRANTY AND UNDERTAKING. Reseller (a)           represents and warrants that (i) it is a corporation duly organized           and existing under the laws of the jurisdiction of its incorporation           with all necessary corporate power and authority to execute, deliver,           and perform its obligations under this Agreement, and that the           execution, delivery, and performance of its obligations under this           Agreement have been duly authorized by all requisite corporate action           of Reseller and all Legal Requirements of Governmental Bodies, (ii) it           has the requisite skill and knowledge necessary to perform its           obligations under this Agreement, (iii) that it currently is not in           violation of any Legal Requirements, and (iv) no current employee or           shareholder of TouchStar has an ownership interest in Reseller or any           affiliate or related entity of Reseller; and (b) covenants that,           during the Term, it (i) shall use its best endeavors to maintain its           corporate identity and remain in existence under the organizing laws           of its jurisdiction and (ii) promptly notify TouchStar in the event           that any employee or shareholder of TouchStar obtains an ownership           interest in Reseller or any affiliate or related entity of Reseller.

     10.3 NOTICES. Without precluding any other sufficient form of notice, all           notices, demands, or other communications under this Agreement shall           be deemed given if sent by registered airmail, facsimile, hand           delivery, or express courier to the address of the party as set out in           this Agreement or to another address specified by the party. All           notices, demands, and other communications in connection with this           Agreement shall be written in the English language.

     10.4 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement           between the parties pertaining to its subject matter, and it           supersedes any and all written or oral agreements previously existing           between the parties with respect to such subject matter. No           supplement, modification, or amendment of this Agreement shall be           binding unless executed in writing by both parties.

     10.5 WAIVER. Either party's failure to insist on strict performance of any           provision of this Agreement shall not be deemed a waiver of any of its           rights or remedies, nor shall it relieve the other party from           performing any subsequent obligation strictly in

                                       21

          accordance with the terms of this Agreement. No waiver shall be           effective unless it is in writing and signed by the party against whom           enforcement is sought. Such waiver shall be limited to provisions of           this Agreement specifically referred to therein and shall not be           deemed a waiver of any other provision. No waiver shall constitute a           continuing waiver unless the writing states otherwise.

     10.6 SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit of,           and shall be binding upon, the respective heirs, legal           representatives, successors, and assigns of each of the parties.

     10.7 ASSIGNMENT.

            (a) TouchStar may assign this Agreement and the rights and                 responsibilities under this Agreement to an Affiliate upon                 written notice to Reseller.

            (b) Except for the rights of TouchStar under Section 10.7(a), this                 Agreement may not be assigned by either party without the prior                 written consent of the other. Any attempted assignment in                 violation of this provision shall be void and shall be deemed a                 breach of this Agreement.

     10.8 INDEMNIFICATION. Reseller shall be solely responsible for, and shall           indemnify TouchStar, its officers, directors, employees, and agents           against, and hold each of them harmless from, any and all claims           (including without limitation, all damages (whether direct, indirect,           incidental, criminal, special, or punitive), losses, liabilities,           expenses, costs, and attorneys' fees related to such claims) resulting           from (a) the negligent or willful failure of Reseller to comply with           its obligations hereunder, (b) the acts or omissions of Reseller, its           officers, directors, employees, or agents during the term of this           Agreement or thereafter, (c) any express or implied representation or           warranty made by Reseller or any of its officers, directors, employees           or agents with regard to the TouchStar Software or the Support           Services not contained in written literature of TouchStar or           specifically authorized by TouchStar in writing, and (c) the           installation of a call center system by TouchStar on behalf of           Reseller or any Other Reseller and the use of the TouchStar Software           in the operation of a call center system, unless caused by the gross           negligence or willful misconduct of TouchStar.

     10.9 SECTION HEADINGS; CONSTRUCTION. The section headings in this Agreement           are included for convenience only and shall not be deemed to limit or           otherwise affect the construction of any of its provisions. The word           including shall be ascribed a non-exclusive meaning unless followed           by the word only.

    10.10 SEVERABILITY. In the event that any of the provisions of this           Agreement shall be held by a court, arbitral panel, or tribunal of           competent jurisdiction to be unenforceable, such provision will be           enforced to the maximum extent permissible and the remaining portions





          of this Agreement shall remain in full force and effect.

    10.11 PARTIES IN INTEREST. Nothing in this Agreement is intended to confer           any rights or remedies on any persons other than the parties to it.           This Agreement shall not be construed to relieve or discharge any           obligations or liabilities of third persons, nor

                                       22

          shall it be construed to give third persons any right of subrogation           or action over against any party to this Agreement.

    10.12 GOVERNING LAW AND ARBITRATION.

            (a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND                 CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF COLORADO,                 UNITED STATES, WITHOUT REGARD TO ITS PRINCIPLES REGARDING                 CONFLICT OF LAWS.

            (b) ARBITRATION. Any dispute arising out of or relating to this                 Agreement, including, without limitation, the interpretation of                 any provision of this Agreement or the breach, termination or                 invalidity of this Agreement that cannot reasonably be resolved                 by the Parties shall be settled exclusively and finally by                 binding arbitration under the International Arbitration Rules of                 the American Arbitration Association in effect on and as of the                 date of this Agreement (the AAA Rules), except as such AAA                 Rules are modified pursuant to this Section 10.12(b).

                  (i)   The arbitration shall be conducted before a panel of                         three (3) arbitrators, each of whom shall be fluent in                         English and shall have knowledge in the call center                         industry. TouchStar shall appoint one (1) arbitrator,                         Customer shall appoint one (1) arbitrator, and the third                         arbitrator shall be selected by the two (2) arbitrators                         so appointed; PROVIDED, HOWEVER, that if the two (2)                         arbitrators appointed by the parties fail to select the                         third arbitrator within thirty (30) days after the date                         on which the last of such two (2) arbitrators are                         appointed, then the third arbitrator shall be appointed                         by the administrator in accordance with the AAA Rules.                         The third arbitrator, regardless of how selected, shall                         chair the arbitration panel.

                  (ii)  Once the arbitrators are impaneled, if (A) an arbitrator                         withdraws after a challenge, (B) the administrator                         sustains a challenge and removes an arbitrator, (C) an                         arbitrator dies, or (D) an arbitrator otherwise resigns                         or is removed, then the party which appointed such                         arbitrator shall appoint a replacement arbitrator within                         thirty (30) days in accordance with the procedures set                         forth in Section 10.12(b)(i).

                  (iii) The arbitration shall be conducted in Denver, Colorado,                         United States. The arbitration shall be conducted in                         English; PROVIDED, that either party, at its cost, may                         provide for the simultaneous translation of the                         arbitration into a language other than English.

                  (iv)  No less than thirty (30) days prior to the date on which                         the arbitration proceeding is to begin, each party shall                         submit to the other party the documents, in English, and                         list of witnesses it

                                       23

                        intends to use in the arbitration. At any oral hearing                         of evidence in connection with the arbitration, each                         party or its legal counsel shall have the right to                         examine witnesses and to cross-examine the witnesses of                         the opposing party.

                  (v)   The arbitrators shall apply the substantive law of the                         State of Colorado to any decision issued by the                         arbitration panel, and the arbitrators shall be so                         instructed. The arbitrators shall issue a written                         opinion stating the findings of fact and the conclusions                         of law upon which the decision is based. The decision of                         the arbitrators shall be final and binding. Judgment on                         such award may be entered in any court of appropriate                         jurisdiction, or application may be made to that court                         for a judicial acceptance of the award and an order of                         enforcement, as the party seeking to enforce that award                         may elect. Any arbitration award for money damages shall                         be in Dollars. Other than pursuant to this Section                         10.12(b)(v), the arbitration award shall not include any                         indirect, incidental, special, consequential, or                         punitive damages and the arbitrators shall be so                         instructed.

                  (vi)  Any arbitration award pursuant to this Section 10.12(b)                         shall be subject to the United Nations Convention on the





                        Recognition and Enforcement of Foreign Arbitral Awards                         of 1958.

            (c) JURISDICTION AND VENUE FOR INTERIM RELIEF. Notwithstanding the                 provisions of Section 10.12(b), each party shall have the right                 to bring an action in a court of competent jurisdiction of any                 equitable or other relief as may be necessary to protect the                 rights of such party under this Agreement.

            (d) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY                 IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,                 SUIT, PROCEEDING, CLAIM OR COUNTERCLAIM ARISING OUT OF OR                 RELATING TO THIS AGREEMENT OR ITS INTERPRETATIONS.

    10.13 GOVERNING LANGUAGE. The governing language of this Agreement shall be           English. If this Agreement is translated into a language other than           English, then the English version shall prevail.

    10.14 EXCLUSION OF UNITED NATIONS CONVENTION. The United Nations Convention           on Contracts for the International Sale of Goods is hereby excluded           from application to this Agreement.

    10.15 FORCE MAJEURE. Neither party shall be responsible for any failure to           perform due to unforeseen circumstances or to causes beyond that           party's control, including but not limited to acts of God, war, riot,           acts of terrorism, embargoes, acts of civil or military authorities,           compliance with governmental laws, rules or regulations, failure of           telecommunications connectivity beyond the reasonable control of the           parties,

                                       24

          accidents, strikes, labor disputes, or shortages. Failure to perform           shall be excused during the continuance of such circumstances, but           this Agreement shall otherwise remain in effect.

    10.16 PUBLICITY; DISCLOSURES. Except as expressly provided herein and except           to the extent required by applicable law, no news releases or other           public disclosures relating to this Agreement, its existence or its           subject matter, including without limitation, photographs, public           announcements or confirmation of the same, shall be made by either           party without the prior written approval of the other party.

                            [SIGNATURE PAGE FOLLOWS]

                                       25

         IN WITNESS OF THE FOREGOING, the parties have caused this Agreement to be signed by their respective duly authorized representatives all as of the Effective Date.

WORLDWIDE STRATEGIES INC.                 TOUCHSTAR SOFTWARE CORPORATION

By: /s/ JAMES P.R. SAMUELS                By: /s/ SHAWN SUHRSTEDT    ----------------------------               ----------------------------- Title:  PRESIDENT                         Title:    CFO       -------------------------                 --------------------------- Date:  SEPT 14-2005                       Date:   9/15/5      --------------------------                ----------------------------





                                       26 
Question: Highlight the parts (if any) of this contract related to Covenant Not To Sue that should be reviewed by a lawyer. Details: Is a party restricted from contesting the validity of the counterparty’s ownership of intellectual property or otherwise bringing a claim against the counterparty for matters unrelated to the contract?

SOLUTION:
In particular, and without limitation, Reseller shall not