Document:

Supplemental Agreement
to the Three Parties Fund Escrow Agreement

 

 

 

Party
A: Yantai Shencaojishi Pharmaceuticals Co., Ltd.

 

Address:
No.9 Tianzheng Road, Laishan District, Yantai City, Shandong Province

 

Legal Representative: Qu Hongwei

 

 

 

Party B: Rural
Credit Cooperative of Laishan District, Yantai City

 

Address: No. 27 Yinhai Road, Laishan District,
Yantai City, Shandong Province

 

Legal Representative: Wang Yingcheng

 

 

 

Party C: EURO PACIFIC CAPITAL, INC.

 

Address: 1201 Dove Street, Ste. 200, Newport
Beach, California 92660, USA

 

Legal Representative: Gordon McBean

 

 

 

Whereas,

 

		(1)	Party
A, Party B and Party C entered into the Three Parties Fund Escrow Agreement on May 8, 2012 (“Original Agreement”),
according to which, Party A and Party C jointly authorized Party B to safekeep the Fund in the Escrow Account; and

 

		(2)	Party A opened the Escrow Account with the Escrow Bank, Rural Credit Cooperative of Binhai, Laishan District, Yantai City (the
“Escrow Bank”), which is a subsidiary of Party B, and deposited the Fund equal to RMB 59,000,000 into the Escrow Account.

 

Parties A, Party B and Party C, on the basis
of mutual benefit, and upon consultation, unanimously agree to enter into this supplemental agreement on May  9  , 2012
(this “Agreement”), as the amendments and supplemental agreements to the Original Agreement.

 

		1.	Paragraph 1 of Article 4 in the Original Agreement shall be revised to read asfollows:

 

    	 

    	 	

    
 

			Party A opened the Escrow Account with the Escrow Bank which is a subsidiary of Party B, and deposited the
Fund equal to RMB 59,000,000 into the Escrow Account. No party to this Agreement may withdraw any portion of the Fund from the
Escrow Account, without the prior written approval of both Party A and Party C.

 

Information of the Escrow Account:

 

Account Name:     Yantai
Shencaojishi Pharmaceuticals Co., Ltd.

 

Depositary
Bank:  Rural Credit Cooperative of Binhai, Laishan District, Yantai City

 

Account Number:[
]

 

		2.	Party A and Party C hereby jointly provided Party B with a Authorization Notice of the Transfer
Instruction (see the Exhibit), which includes the list of the names of the designated representatives authorized to send the Transfer
Instruction, the power and the responsibilities of each authorized representative, and the samples of seals and signatures specimens
of the authorized representatives. The written notice shall be affixed with Party A’s company seal and signed by Party A’s
legal representative or authorized representative, and it shall also be signed by Party C’s legal representative or authorized
representative. Party B shall issue a receipt after receiving the foregoing notice. The notice will become into effect after Party
A and Party C receive Party B’s receipts and confirm the receipt in writing.

 

		3.	Unless otherwise agreed, the definitions hereunder shall remain the same as stipulated under the
Original Agreement.

 

		4.	This Agreement is part of the Original Agreement, which has the same effect with the Original Agreement.
If there is any inconsistency between this Agreement and the Original Agreement, this Agreement shall prevail. Except the amendments
hereunder, other terms and conditions under the Original Agreement shall remain valid and effective.

 

		5.	Party B warrants, represents and agrees that Party B has and will take all necessary actions to
cause its subsidiary and the Escrow Bankto honor and abide by the terms of this Agreement and the Original Agreement as if the
Escrow Bank had signed this Agreement and the Original Agreement as Party B. Accordingly, Party B and the Escrow Bank will be liable
to Party A and Party C for any breach, liability, and/or damages caused by Party B or the Escrow Bank relating to this Agreement
and Original Agreement.

 

		6.	This Agreement shall become effective after (i) Party A’s legal reprehensive or authorized
representative of signs it and affixes with its corporate seal, (ii) Party B’s legal representative or authorized representative
signs it and affixes with its corporate seal; and (iii) Party C’s legal representative or authorized representative signs
it.

 

		7.	This Agreement shall be executed in six (6) counterparts, with each party holding two (2) counterparts. Each counterpart shall
have the same effect.

 

 

(signature page below)

    	 

    	 	

    

 

Party
A: Yantai Shencaojishi Pharmaceuticals Co., Ltd.

 

Legal Representative: Qu Hongwei

 

 

 

Date:

 

 

 

Party B: Rural
Credit Cooperative of Laishan District, Yantai City

 

Legal Representative: Wang Yingcheng

 

 

 

Date:

 

 

 

Party C: EURO PACIFIC CAPITAL, INC.

Legal Representative: Gordon McBean

 

Date:

 

    	 

    	 	

    
 

Exhibit

 

Authorization Notice
of the Transfer Instruction

 

Rural Credit Cooperative of Binhai, Laishan District,
Yantai City:

 

Without receiving and confirming the written instruction
jointly made by the authorized representatives of Yantai Shencaojishi Pharmaceuticals Co., Ltd. (“Party A”) and Euro
Pacific Capital, Inc. (“Party C”), Rural Credit Cooperative of Binhai, Laishan District, Yantai City (“Escrow
Bank”) shall not dispose of any of the funds in the escrow account.

 

From the opening date of the escrow account (account
number: ---) to the termination date of this account, unless any amendments are made by any legal and effective authorization documents,
the following persons are authorized to make the Transfer Instruction within their authorization scope stipulated below:

 

1.Authorized
Persons and Authorization Scope

 

		(1)	The authorized persons to handle the Transfer Instruction:

 

Party A:_____

Party C:_____

 

		(2)	The authorized persons to verify the Transfer Instruction:

 

Party A:_____

Party C:_____

 

		(3)	The Accountant in-charge to verify the Transfer Instruction:

 

Party A:_____

Party C:_____

 

2.The
specimens of the authorized signatories to the Transfer Instruction:

 

	 	(signature)	(signature)
	 	[Person from Party A]	[Person from Party C]

 

3.The
reserved seal sample of authorized person of Transfer Instruction:

 

 

 

 

 

(Company Chop)

 

Legal Representative
(Authorized Representative):

 

(Date)NOTE

 

	$6,103,027.00	May 7, 2012

 

FOR VALUE RECEIVED,
the undersigned, OXFORD SUMMIT APARTMENTS II LLC, a Georgia limited liability company, hereby promises to pay to the order of SUMMIT
CROSSING MEZZANINE LENDING, LLC, a Georgia limited liability company (“Lender”), in accordance with the terms of that
certain Mezzanine Loan Agreement dated as of May 7, 2012, as from time to time in effect, among the undersigned and Lender (the
“Loan Agreement”) to the extent not sooner paid, on or before the Maturity Date, the principal sum of SIX MILLION ONE
HUNDRED THREE THOUSAND TWENTY-SEVEN AND NO/100 DOLLARS ($6,103,027.00), or such amount as may be advanced by the payee hereof under
the Loan Agreement, together with such additional principal from time to time outstanding under the Loan Agreement, with daily
interest from the date hereof, computed as provided in the Loan Agreement, on the principal amount hereof from time to time unpaid,
at a rate per annum on each portion of the principal amount which shall at all times be equal to the rate of interest applicable
to such portion in accordance with the Loan Agreement, and with interest on overdue principal and, to the extent permitted by applicable
law, on overdue installments of interest and late charges at the rates provided in the Loan Agreement. Interest shall be payable
on the dates specified in the Loan Agreement, except that all accrued interest shall be paid at the stated or accelerated maturity
hereof or upon the prepayment in full hereof. Capitalized terms used herein and not otherwise defined herein shall have the meanings
set forth in the Loan Agreement.

 

Payments hereunder
shall be made to Lender, c/o Preferred Apartment Communities, Inc., One Overton Park, 3625 Cumberland Blvd., Suite 400, Atlanta,
Georgia 30339, Attn: Leonard A. Silverstein, Esq., as provided in the Loan Agreement.

 

This Note is one of
one or more Notes evidencing borrowings under and is entitled to the benefits and subject to the provisions of the Loan Agreement.
The principal of this Note may be due and payable in whole or in part prior to the Maturity Date and is subject to mandatory prepayment
in the amounts and under the circumstances set forth in the Loan Agreement, and may be prepaid in whole or from time to time in
part, all as set forth in the Loan Agreement.

 

Notwithstanding anything
in this Note to the contrary, all agreements between the undersigned Borrower and the Lender, whether now existing or hereafter
arising and whether written or oral, are hereby limited so that in no contingency, whether by reason of acceleration of the maturity
of any of the Obligations or otherwise, shall the interest contracted for, charged or received by the Lender exceeds the maximum
amount permissible under applicable law. If, from any circumstance whatsoever, interest would otherwise be payable to the Lender
in excess of the maximum lawful amount, the interest payable to the Lender shall be reduced to the maximum amount permitted under
applicable law; and if from any circumstance the Lender shall ever receive anything of value deemed interest by applicable law
in excess of the maximum lawful amount, an amount equal to any excessive interest shall be applied to the reduction of the principal
balance of the Obligations of the undersigned Borrower and to the payment of interest or, if such excessive interest exceeds the
unpaid balance of principal of the Obligations of the undersigned Borrower, such excess shall be refunded to the undersigned Borrower.
All interest paid or agreed to be paid to the Lender shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full period until payment in full of the principal of the Obligations of the undersigned Borrower
(including the period of any renewal or extension thereof) so that the interest thereon for such full period shall not exceed the
maximum amount permitted by applicable law. This paragraph shall control all agreements between the undersigned Borrower and the
Lender.

 

    	 

    	 

    

 

In case an Event of
Default shall occur, the entire principal amount of this Note plus all accrued and unpaid interest may become or be declared due
and payable in the manner and with the effect provided in said Loan Agreement.

 

This Note shall be
governed by and construed in accordance with the internal laws of the State of Georgia (without giving effect to the conflict of
laws rules of any jurisdiction).

 

The undersigned maker
and all guarantors and endorsers, hereby waive presentment, demand, notice, protest, notice of intention to accelerate the indebtedness
evidenced hereby, notice of acceleration of the indebtedness evidenced hereby and all other demands and notices in connection with
the delivery, acceptance, performance and enforcement of this Note, except as specifically otherwise provided in the Loan Agreement,
and assent to extensions of time of payment or forbearance or other indulgence without notice.

 

IN WITNESS WHEREOF
the undersigned has duly executed this Note under seal as of the day and year first above written.

 

	 	OXFORD SUMMIT APARTMENTS II LLC, a

Georgia limited liability company
	 	 	 
	 	By:	Oxford Summit Development II LLC, a Georgia limited liability company, its sole Member and Manager
	 	 	 
	 	 	By:	/s/ W. Daniel Faulk, Jr.	[Seal]
	 	 	Name: W. Daniel Faulk, Jr.
	 	 	Its: Manager

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