Document:

Exhibit 10.3

 

 

LIMITED LIABILITY COMPANY AGREEMENT

 

OF

 

BR CARROLL GLENRIDGE JV LLC

 

A DELAWARE LIMITED LIABILITY COMPANY

 

DATED AS OF OCTOBER 13, 2016

 

 

    	 	 	 

     

    

 

LIMITED LIABILITY COMPANY
AGREEMENT

OF

BR CARROLL GLENRIDGE JV LLC

 

THIS LIMITED LIABILITY
COMPANY AGREEMENT of BR CARROLL GLENRIDGE JV LLC (“JV” or “Company”) is made and entered
into and is effective as of October 13, 2016, by and between BR Glenridge JV Member, LLC, a Delaware limited liability company
(“Bluerock”) and Carroll Co-Invest IV Glenridge, LLC, a Georgia limited liability company (“Carroll”)
(this “Agreement”). Capitalized terms used herein shall have the meanings ascribed to such terms in this Agreement.

 

Effective as of October
13, 2016, the Members, by execution of this Agreement, hereby form the Company as a limited liability company pursuant to and in
accordance with the Delaware Limited Liability Company Act (6 Del. C. §18-101 et seq.), as amended from time to time (the
“Act”), and this Agreement; and the Members hereby agree as follows:

 

		Section 1.	Definitions. As used in this Agreement:

 

“Act”
shall mean the Delaware Limited Liability Company Act (currently Chapter 18 of Title 6 of the Delaware Code), as amended from time
to time.

 

“Adjusted Capital
Account Deficit” shall mean, with respect to any Member, the deficit balance, if any, in such Member’s Capital
Account as of the end of the applicable Fiscal Year after (i) crediting such Capital Account with any amounts which such Member
is deemed to be obligated to restore pursuant to Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), and (ii) debiting such Capital
Account by the amount of the items described in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6). The foregoing definition
of Adjusted Capital Account Deficit is intended to comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall
be interpreted consistently therewith.

 

“Advisor”
shall mean any accountant, attorney or other advisor retained by a Member.

 

“Affiliate”
shall mean with respect to any Person (i) more than ten percent (10%) of the issued and outstanding stock of which, or more than
ten percent (10%) of the ownership interests of which, is owned, directly or indirectly, by a Person, including a Member, (ii)
that now or hereafter owns, directly or indirectly, more than a ten percent (10%) ownership interest in a Person, including the
Company or in any Member, (iii) any agent, trustee, officer, director, employee, partner, member, manager or shareholder or member
of the family of such Person (or any member of the family of any such agent, trustee, officer, director, employee, partner, member,
manager or shareholder) or (iv) any corporation, partnership, limited liability company, trust or other entity that, directly or
indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person. The
term “control” (including the terms “controlled by” and “under common control with”) means
the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether
through the ownership of voting securities, by contract or otherwise. The term “family” shall be deemed to include
spouses, children, parents, brothers and sisters, and the spouse, children, parents, brothers and sisters of such spouse’s
children, parents, brothers and sisters.

 

    	 	 	 

     

    

 

“Agreed Upon Value”
shall mean the fair market value (net of any debt) agreed upon pursuant to a written agreement between the Members of property
contributed by a Member to the capital of the Company, which shall for all purposes hereunder be deemed to be the amount of the
Capital Contribution applicable to such property contributed.

 

“Agreement”
shall mean this Limited Liability Company Agreement, as amended from time to time.

 

“Annual Business
Plan” shall mean, with respect to the Property, the business plan for a Fiscal Year of the Company prepared by Property
Manager and approved by the Members as further described in Section 9.3.

 

“Applicable Adjustment
Percentage” shall have the meaning set forth in Section 5.2(b)(3).

 

“Backstop Agreement(s)”
shall mean those certain agreements providing for the allocation of liability and contribution for losses arising from any “bad
boy” guaranties constituting part of the Loan Documents.

 

“Bankruptcy Code”
shall mean Title 11 of the United States Code, as amended or any other applicable bankruptcy or insolvency statute or similar law.

 

“Bankruptcy/Dissolution
Event” shall mean, with respect to the affected party, (i) the entry of an Order for Relief under the Bankruptcy Code,
(ii) the admission by such party of its inability to pay its debts as they mature, (iii) the making by it of an assignment for
the benefit of creditors generally, (iv) the filing by it of a petition in bankruptcy or a petition for relief under the Bankruptcy
Code or any other applicable federal or state bankruptcy or insolvency statute or any similar law, (v) the expiration of sixty
(60) days after the filing of an involuntary petition under the Bankruptcy Code without such petition being vacated, set aside
or stayed during such period, (vi) an application by such party for the appointment of a receiver for the assets of such party,
(vii) an involuntary petition seeking liquidation, reorganization, arrangement or readjustment of its debts under any other federal
or state insolvency law, provided that the same shall not have been vacated, set aside or stayed within sixty (60) days after filing,
(viii) the imposition of a judicial or statutory lien on all or a substantial part of its assets unless such lien is discharged
or vacated or the enforcement thereof stayed within sixty (60) days after its effective date, (ix) an inability to meet its financial
obligations as they accrue, or (x) a dissolution or liquidation.

 

“Beneficial Owner”
shall have the meaning provided in Section 5.7.

 

“Bluerock”
shall have the meaning provided in the first paragraph of this Agreement.

 

“Bluerock Transferee”
shall have the meaning set forth in Section 12.2(b)(2).

 

    	 	 -2-	 

     

    

 

“BR REIT”
shall mean Bluerock Residential Growth REIT, Inc., a Maryland corporation.

 

“BR Growth”
shall mean Bluerock Growth Fund, LLC, a Delaware limited liability company.]

 

“BR Growth II”
shall mean Bluerock Growth Fund II, LLC, a Delaware limited liability company.  

 

“BR SOIF II”
shall mean Bluerock Special Opportunity + Income Fund II, LLC, a Delaware limited liability company.

 

“BR SOIF III”
shall mean Bluerock Special Opportunity + Income Fund III, LLC, a Delaware limited liability company.

 

“Capital Account”
shall have the meaning provided in Section 5.6.

 

“Capital Contribution”
shall mean, with respect to any Member, the aggregate amount of (i) cash, and (ii) the Agreed Upon Value of other property contributed
by such Member to the capital of the Company net of any liability secured by such property that the Company assumes or takes subject
to.

 

“Carroll”
shall have the meaning provided in the first paragraph of this Agreement.

 

“Carroll Parent”
shall mean MPC Partnership Holdings LLC, a Georgia limited liability company.

 

“Carroll Change
Event” shall mean (i) gross negligence, willful misconduct, fraud or bad faith by Carroll or any of its Affiliates in
connection with or relating to the Company or the Property or any portion thereof; (ii) a Bankruptcy/Dissolution Event shall have
occurred with respect to Carroll or Property Manager; or (iii) failure to satisfy the Carroll Ownership/Control Requirement.

 

“Carroll Ownership/Control
Requirement” as of any particular date means that each of the following conditions is satisfied: (i) at least one of
the Key Individuals is not then dead, insane as determined by a qualified physician, incapacitated as determined by a qualified
physician, or the subject of a Bankruptcy/Dissolution Event; and (ii) at least one of the Key Individuals is actively involved
in the operation and management of (a) Carroll or Carroll Parent and (b) CMG.

 

“Carroll Transferee”
shall have the meaning set forth in Section 12.2(b)(1).

 

“Cash Flow”
shall mean, for any period for which Cash Flow is being calculated, gross cash receipts of the Company (but excluding Capital Contributions),
less the following payments and expenditures: (i) all payments of operating expenses of the Company (or the Subsidiary owning the
Property), (ii) all payments of principal of, interest on and any other amounts due with respect to indebtedness, leases or other
commitments or obligations of the Company (or the Subsidiary owning the Property) (including on loans by Members to the Company),
(iii) all sums expended by the Company (or any Subsidiary owning the Property) for capital expenditures, (iv) all prepaid expenses
of the Company (or any Subsidiary owning the Property), and (v) all sums expended by the Company (or any Subsidiary owning the
Property) which are otherwise capitalized.

 

    	 	 -3-	 

     

    

 

“Cause”
shall mean gross negligence, willful misconduct, fraud, bad faith or a Bankruptcy/Dissolution Event, or a termination of the Management
Agreement by or at the behest of a third-party lender under an applicable Collateral Agreement.

 

“Certificate of
Formation” shall mean the Certificate of Formation of the Company, as amended from time to time.

 

“CMG”
shall mean Carroll Management Group, LLC, a Georgia limited liability company.

 

“Code”
shall mean the Internal Revenue Code of 1986, as amended from time to time, including the corresponding provisions of any successor
law.

 

“Collateral Agreement”
shall mean any agreement, instrument, document or covenant concurrently or hereafter made or entered into under, pursuant to, or
in connection with this Agreement and any certifications made in connection therewith or amendment or amendments made at any time
or times heretofore or hereafter to any of the same (including, without limitation, the Management Agreement and the Cost Sharing
Agreement).

 

“Company”
shall mean BR Carroll Glenridge JV LLC, a Delaware limited liability company organized under the Act.

 

“Company Minimum
Gain” shall have the meaning given to the term “partnership minimum gain” in Regulations Sections 1.704-2(b)(2)
and 1.704-2(d).

 

“Confidential Information”
shall have the meaning provided in Section 10.01.

 

“Controllable Expenses”
shall mean all expenses, other than Uncontrollable Expenses, incurred by the Company or any Subsidiary of the Company with respect
to the Property.

 

“Cost Sharing Agreement”
shall mean the Agreement Regarding Purchase and Sale Contract & Acquisition Loan Fees and Deposits, dated August 16, 2016 by
and between Bluerock Residential Holdings, L.P. and Carroll Acquisitions, LLC with respect to the Property.

 

“Default Amount”
shall have the meaning provided in Section 5.2(b).

 

“Default Loan”
shall have the meaning provided in Section 5.2(b)(1).

 

“Default Loan Rate”
shall have the meaning provided in Section 5.2(b)(1).

 

“Defaulting Member”
shall have the meaning provided in Section 5.2(b).

 

    	 	 -4-	 

     

    

 

“Delaware UCC”
shall mean the Uniform Commercial Code as in effect in the State of Delaware from time to time.

 

“Dissolution Event”
shall have the meaning provided in Section 13.2.

 

“Distributable Funds”
with respect to any month or other period, as applicable, shall mean an amount equal to the Cash Flow of the Company for such month
or other period, as applicable, as reduced by reserves for anticipated capital expenditures, future working capital needs and operating
expenses, contingent obligations and other purposes of the Company or any Subsidiary, the amounts of which shall be reasonably
determined from time to time by the Management Committee.

 

“Distributions”
shall mean the distributions payable (or deemed payable) to a Member (including, without limitation, its allocable portion of Distributable
Funds).

 

“Emergency Expenditure”
shall have the meaning provided in the Management Agreement.

 

“ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time.

 

“Fiscal Year”
shall mean each calendar year ending December 31.

 

“Flow Through Entity”
shall have the meaning provided in Section 5.7.

 

“Foreign Corrupt
Practices Act” shall mean the Foreign Corrupt Practices Act of the United States, 15 U.S.C. Sections 78a, 78m, 78dd-1,
78dd-2, 78dd-3, and 78ff, as amended, if applicable, or any similar law of the jurisdiction where the Property is located or where
the Company or any of its Subsidiaries transacts business or any other jurisdiction, if applicable.

 

“Imputed Closing
Costs” means an amount (not to exceed one and one quarter percent (1.25%) of the purchase price) that would normally
be incurred by the Company or a Subsidiary if the Property were sold for an amount specified in Section 15.1 or Section
15.2 (as applicable), for title insurance premiums, survey costs, brokerage commissions, legal fees, and other commercially
reasonable closing costs.

 

“Income”
shall mean the gross income of the Company for any month, Fiscal Year or other period, as applicable, including gains realized
on the sale, exchange or other disposition of the Company’s assets.

 

“Indemnified Party”
shall have the meaning provided in Section 14.4(a).

 

“Indemnifying Party”
shall have the meaning provided in Section 14.4(a).

 

“Inducement Agreements”
shall have the meaning provided in Section 14.4(a).

 

“Initial Business Plan”
shall have the meaning provided in Section 9.3(a).

 

“Initiating Member”
shall have the meaning provided in Section 15.2(a).

 

    	 	 -5-	 

     

    

 

“Interest”
of any Member shall mean the entire limited liability company interest of such Member in the Company, which includes, without limitation,
any and all rights, powers and benefits accorded a Member under this Agreement and the duties and obligations of such Member hereunder.

 

“Internal Rate of
Return” and “IRR” shall mean, as of any date, the internal rate of return on the Total Investment
of a Member to such date, calculated to be that discount rate (expressed on a percent per annum basis) which, when divided by twelve
(12), compounded annually and applied to such Total Investment and the corresponding Distributions with respect thereto, causes
the net present value, as of such date, of such Distributions and Total Investment to equal zero (calculated with the “XIRR”
function in Microsoft Excel and using the latest version of Microsoft Excel available as of the date hereof). For this purpose,
Capital Contributions and Distributions shall be assumed to have occurred as of the end of the month in which such Capital Contribution
or Distribution takes place. For purposes of determining the Internal Rates of Return hereunder, calculations shall be denominated
and calculated in US Dollars.

 

“Key Individual”
shall mean each of Patrick Carroll and Joshua Champion.

 

“Loan”
shall mean that certain acquisition loan in the initial principal amount of Forty Eight Million Four Hundred Thirty One Thousand
and no/100 Dollars ($48,431,000.00) originally made by Keybank National Association (“Keybank”), for and on
behalf of Freddie Mac, as the assignee thereof which is secured by the Property.

 

“Loss”
shall mean the aggregate of losses, deductions and expenses of the Company for any month, Fiscal Year or other period, as applicable,
including losses realized on the sale, exchange or other disposition of the Company’s assets.

 

“Major Decision”
means any decision for the Company to take, or refrain from taking, any action or incurring any obligation with respect to the
following matters (or the effectuation of any such action or obligation):

 

		(i)	any merger, conversion or consolidation involving the Company or any Subsidiary or the sale, lease,
transfer, exchange or other disposition of all or substantially all of the Company’s assets or all of the Interests of the
Members in the Company, in one or a series of related transactions;

 

		(ii)	except as expressly provided in Section 12 with respect to Transfers by Bluerock or a Bluerock
Transferee to a Bluerock Transferee and with respect to Transfers by Carroll as permitted thereunder, the admission or removal
of any Member or the Company’s issuance to any third party of any equity interest in the Company (including interests convertible
into, or exchangeable for, equity interests in the Company);

 

		(iii)	except upon the occurrence of any Dissolution Event, any liquidation, dissolution or termination
of the Company or any Subsidiary;

 

		(iv)	giving, granting or undertaking any options, rights of first refusal, deeds of trust, mortgages,
pledges, ground leases, security or other interests in or encumbering the Property, any portion thereof or any other material assets;

 

    	 	 -6-	 

     

    

 

		(v)	selling, conveying or effecting any other direct or indirect transfer of the Property, any Subsidiary
or other material asset of the Company or any portion thereof or the entering into of any agreement, commitment or assumption with
respect to any of the foregoing;

 

		(vi)	acquiring, directly or through any Subsidiaries, by purchase, ground lease or otherwise, any real
property or other material asset or the entry into of any agreement, commitment or assumption with respect to any of the foregoing,
or the making or posting of any deposit (refundable or non-refundable);

 

		(vii)	taking any action by the Company or any Subsidiary that is reasonably likely to result in any Member
or any of its Affiliates having individual liability under any so called “bad boy” guaranties or similar agreements
provided to third party lenders in respect of financings relating to the Company, the Subsidiaries or any of their assets which
provide for recourse as a result of willful misconduct, fraud or gross negligence or failure to comply with the covenants or any
other provisions of such “bad boy” guaranties;

 

		(viii)	institute or settle any Company or Subsidiary legal claims in excess of $50,000;

 

		(ix)	employ, enter into any contract with (or materially modify any contract with), or otherwise compensate,
directly or indirectly, the Manager or any Affiliate of the Manager;

 

		(x)	amend, modify, recast, refinance or replace any financing to which the Company or a Subsidiary
is a party or which encumbers the Property or any portion thereof;

 

		(xi)	incur on behalf of the Company or a Subsidiary during any year any capital expenditures in excess
of $50,000 in the aggregate unless pursuant to an Annual Business Plan approved by the Members;

 

		(xii)	make any loan to any Member, except as expressly provided for in this Agreement;

 

		(xiii)	cause or permit the Company or a Subsidiary to file for or fail to contest a bankruptcy proceeding,
or seek or permit a receivership or make an assignment for the benefit of its creditors;

 

		(xiv)	terminate the Management Agreement or issue a notice of default pursuant to the Management Agreement;
provided, however, that (A) any such termination shall be subject to the terms of the Management Agreement and (B) in the event
of a default by CMG under the Management Agreement, which default is not cured in any available cure period, only Bluerock shall
be authorized to take any action with respect to any remedies on behalf of the Company or any Subsidiary, including the right to
terminate the Management Agreement, and to solicit bids for, and enter into any replacement Management Agreement with, any replacement
manager thereunder;

 

    	 	 -7-	 

     

    

 

		(xv)	cause or permit any of the organizational documents, including this Agreement, of the Company or
of any Subsidiary of the Company to be amended in any manner, other than any amendment (A) required (1) by a lender to the Company
or any Subsidiary of the Company or (2) in order for a REIT Member to qualify as a “real estate investment trust” under
the Code, in each case, to the extent such amendment referenced in clauses (1) and (2) of this subparagraph does not result in
the dilution of any Member, does not adversely affect any Member’s right to Distributions pursuant to Section 6 and does
not otherwise have a materially adverse effect on the rights of any Member, or (B) that is solely ministerial in nature to reflect
or implement this Agreement under its express terms (such as, for example, to periodically update the Members’ respective
Capital Contribution amounts, Percentage Interests or Management Committee representatives on Exhibit A); or

 

		(xvi)	make distributions to the Members, except in accordance with Section 6 hereof.

 

“Management Agreement”
shall mean, the property management agreement to be entered into between the Company (or any Subsidiary of the Company), as owner,
and Property Manager, as manager, pursuant to which Property Manager will provide certain management services for the Property,
to be in the form attached hereto as Exhibit C.

 

“Management Committee”
shall have the meaning provided in Section 9.2(a).

 

“Manager”
shall have the meaning provided in Section 9.1(a).

 

“Material
Deviation” shall have the meaning provided in Section 9.3(f).

 

“Member”
and “Members” shall mean Bluerock, Carroll and any other Person admitted to the Company pursuant to this Agreement.
For purposes of the Act, the Members shall constitute a single class or group of members.

 

“Member in Question”
shall have the meaning provided in Section 16.12.

 

“Member Minimum
Gain” shall mean an amount, determined in accordance with Regulations Section 1.704-2(i)(3) with respect to each
Member Nonrecourse Debt, equal to the Company Minimum Gain that would result if such Member Nonrecourse Debt were treated as a
Nonrecourse Liability.

 

“Member Nonrecourse
Debt” shall have the meaning given the term “partner nonrecourse debt” in Regulations Section 1.704-2(b)(4).

 

“Member Nonrecourse
Deductions” shall have the meaning given the term “partner nonrecourse deductions” in Regulations Section 1.704-2(i).

 

“Minimum Return”
shall mean a cash-on-cash return on a Member’s total Capital Contributions to the Company equal to, when determined on a
quarterly basis and annualized, nine percent (9%).

 

“Net Income”
shall mean the amount, if any, by which Income for any period exceeds Loss for such period.

 

“Net Loss”
shall mean the amount, if any, by which Loss for any period exceeds Income for such period.

 

    	 	 -8-	 

     

    

 

“New York UCC”
shall have the meaning set forth in Section 16.17.

 

“Non-Initiating Member”
shall have the meaning provided in Section 15.2(a).

 

“Nonrecourse Deduction”
shall have the meaning given such term in Regulations Section 1.704-2(b)(1).

 

“Nonrecourse Liability”
shall have the meaning given such term in Regulations Section 1.704-2(b)(3).

 

“Offer” shall have
the meaning provided in Section 15.2(a).

 

“Offeror” shall
have the meaning provided in Section 15.1(b).

 

“Offeree” shall
have the meaning provided in Section 15.1(b).

 

“Owner”
shall mean BR Carroll Glenridge, LLC, a Delaware limited liability company.

 

“Ownership Entity”
shall have the meaning provided in Section 15.2(a).

 

“Percentage Interest”
shall have the meaning provided in Section 5.3.

 

“Person”
shall mean any individual, corporation, partnership, joint venture, association, joint-stock company, limited liability company,
trust, unincorporated organization, government or any agency or political subdivision thereof or any other legal entity.

 

“Preferred Return”
shall mean, with regard to any and all Capital Contributions made by a Member the greater of (a) an Internal Rate of Return equal
to ten percent (10%) and (b) a return on such capital contributions equal to a 1.35 multiple thereof. The Preferred Return shall
be calculated from the date that any such Capital Contributions are made including, in the case of any amounts funded pursuant
to the Cost Sharing Agreement, the date such amounts are actually funded under the Cost Sharing Agreement.

 

“Property”
shall have the meaning provided in Section 3.

 

“Property Management
Fee” shall have the meaning provided in Section 9.7.

 

“Property Manager”
shall mean CMG so long as the initial Management Agreement is in full force and effect with respect to the Property, and, thereafter,
the entity performing similar services for the Company (or any Subsidiary that owns the Property) with respect to the Property.

 

“Property Manager
Reports” shall have the meaning set forth in Section 8.2(c).

 

“Protective Capital
Call” shall mean a Capital Call necessary or advisable to (a) protect the Company’s (or any Subsidiary’s)
interest in the Property (e.g., payment of taxes, repair of the Property following uninsured damage thereto, payment of insurance
premiums, etc.); (b) to prevent a default with respect to any financing obtained by the Company or any Subsidiary (e.g., payment
of debt service following an operating shortfall, reserves required by the lender, a reduction in principal required by the lender
to meet loan to value requirements); or (c) funds required to refinance the Property when the current financing has matured or
will mature in the near future (e.g., commitment fees, loan application fees, equity infusions to meet market loan to value requirements,
etc.).

 

    	 	 -9-	 

     

    

 

“Purchase Agreement”
shall mean that certain Sale-Purchase Agreement, dated August 12, 2016, as amended by that First Amendment of Sale-Purchase Agreement
dated August 19, 2016, as further amended by that Second Amendment of Sale-Purchase Agreement dated August 24, 2016, as further
amended by that Third Amendment of Sale-Purchase Agreement dated August 25, 2016, by and between Carroll Acquisitions, LLC (“Carroll
Acquisitions”), and the seller party named therein, pursuant to which Carroll Acquisitions has contracted to acquire
the Property.

 

“Pursuer”
shall have the meaning provided in Section 10.3.

 

“Regulations”
shall mean the Treasury Regulations promulgated pursuant to the Code, as amended from time to time, including the corresponding
provisions of any successor regulations.

 

“Reimbursable Expenses”
shall have the meaning provided in the Management Agreement.

 

“REIT” shall mean a real estate
investment trust as defined in Code Section 856.

 

“REIT Member” shall mean any
Member, if such Member is a REIT or a direct or indirect subsidiary of a REIT.

 

“REIT Requirements” shall mean
the requirements for qualifying as a REIT under the Code and Regulations.

 

“Representatives”
shall have the meaning provided in Section 9.2(a).

 

“Response Period”
shall have the meaning provided in Section 15.2(b).

 

“Sale Notice” shall
have the meaning provided in Section 15.2(a).

 

“Securities Act”
shall mean the Securities Act of 1933, as amended.

 

“Seller”
shall mean, with respect to the Purchase Agreement, RPG Glenridge LLC, a Delaware limited liability company.

 

“SOIFs”
shall mean, collectively, BR SOIF II and BR SOIF III.

 

“Subordinated Property
Management Fee” shall mean a portion of the Property Management Fee equal to 16.67% of the Property Management Fee or
0.5% of Gross Receipts.

 

    	 	 -10-	 

     

    

 

“Subsidiary”
shall mean, with respect to any Person, any corporation, partnership, limited liability company or other entity of which at least
a majority of the capital stock or other equity securities is owned by such Person.

 

“Tax Matters Member”
shall have the meaning provided in Section 8.3.

 

“Total Investment”
shall mean the sum of the aggregate Capital Contributions made by a Member.

 

“Transfer”
means, as a noun, any transfer, sale, assignment, exchange, charge, pledge, gift, hypothecation, conveyance, encumbrance or other
disposition, voluntary or involuntary, by operation of law or otherwise and, as a verb, voluntarily or involuntarily, by operation
of law or otherwise, to transfer, sell, assign, exchange, charge, pledge, give, hypothecate, convey, encumber or otherwise dispose
of.

 

“Uncontrollable
Expenses” shall mean the following expenses with respect to the Company, Subsidiary or Property: taxes and insurance;
licenses; utilities; unanticipated material repairs that are essential to preserve or protect the Property; debt service; and costs
due to a change in law.

 

“Unsubordinated
Property Management Fee” shall mean a portion of the Property Management Fee equal to 83.33% of the Property Management
Fee or 2.5% of Gross Receipts.

 

“Valuation Amount”
shall have the meaning provided in Section 15.1(b).

 

		Section 2.	Organization of the Company.

 

2.1         Name.
The name of the Company shall be “BR Carroll Glenridge JV LLC”. The business and affairs of the Company shall
be conducted under such name or such other name as the Members deem necessary or appropriate to comply with the requirements of
law in any jurisdiction in which the Company may elect to do business.

 

2.2         Place
of Registered Office; Registered Agent. The address of the registered office of the Company in the State of Delaware is 160
Greentree Drive, Suite 101, Dover, Delaware 19904. The name and address of the registered agent for service of process on the Company
in the State of Delaware is National Registered Agents, Inc., 160 Greentree Drive, Suite 101, Dover, Delaware 19904. The Management
Committee may at any time on five (5) days prior notice to all Members change the location of the Company’s registered office
or change the registered agent.

 

2.3         Principal
Office. The principal address of the Company shall be c/o Bluerock Real Estate, L.L.C., 712 Fifth Avenue, 9th Floor,
New York, New York 10019 and the principal office of Property Manager shall be c/o Carroll Organization, LLC, 3340 Peachtree Road,
Suite 1620, Atlanta, Georgia 30326, or, in each case, at such other place or places as may be determined by the Management Committee
from time to time.

 

    	 	 -11-	 

     

    

 

2.4         Filings.
On or before execution of this Agreement, an authorized person within the meaning of the Act shall have duly filed or caused to
be filed the Certificate of Formation of the Company with the office of the Secretary of State of Delaware, as provided in Section
18-201 of the Act, and the Members hereby ratify such filing. The Manager shall use its best efforts to take such other actions
as may be reasonably necessary to perfect and maintain the status of the Company as a limited liability company under the laws
of Delaware. Notwithstanding anything contained herein to the contrary, the Company shall not do business in any jurisdiction that
would jeopardize the limitation on liability afforded to the Members under the Act or this Agreement.

 

2.5         Term.
The Company shall continue in existence from the date hereof until December 31, 2065, unless extended by the Members, or until
the Company is dissolved as provided in Section 13, whichever shall occur earlier.

 

2.6         Expenses
of the Company. Other than the reimbursement of costs and expenses as provided herein and the fees described in Section
9.7, no fees, costs or expenses shall be payable by the Company to any Member (or its Affiliates).

 

		Section 3.	Purpose.

 

The purpose of the Company,
subject in each case to the terms hereof, shall be to engage, directly or through a Subsidiary, in the business of acquiring, owning,
operating, developing, renovating, repositioning, managing, leasing, selling, financing and refinancing the real estate and any
real estate related investments (or portions thereof) consisting of (a) an approximately 480-unit multi-family complex located
at 5501 Glenridge Drive NE, Atlanta, Georgia 30342, and to be hereafter commonly known as the “Glenridge Apartments”
(the “Property”), which will be owned by the Company or a Subsidiary of the Company, and all other activities
reasonably necessary to carry out such purpose.

 

		Section 4.	Conditions.

 

4.1         Bluerock
Conditions. The obligation of Bluerock to consummate the transactions contemplated herein and to make the initial Capital Contributions
under Section 5.1 is subject to fulfillment of all of the following conditions on or prior to the closing date under the
Purchase Agreement:

 

(a)         Subject
to the terms of the Cost Sharing Agreement, Carroll shall deposit in the Company’s bank account or the designated escrow
account of Chicago Title Insurance Company, c/o Fidelity National Title Group, 5565 Glenridge Drive, Suite 300, Atlanta, Georgia
30342, Attn: Chris Valentine (chris.valentine@fntg.com) (“Title Company”), the aggregate amount of its
initial Capital Contribution set forth on Exhibit A hereto;

 

(b)         The
Purchase Agreement shall have been assigned to the Company (or to one or more Subsidiaries of the Company);

 

(c)         The
Cost Sharing Agreement has been executed and Carroll and its affiliates are in full compliance with the terms thereof;

 

(d)         The
Management Agreement for the Property shall have been executed by the Company (or a Subsidiary of the Company) and Property Manager;

 

    	 	 -12-	 

     

    

 

(e)         All
of the representations and warranties of Carroll and Property Manager contained in this Agreement and the Collateral Agreements
shall be true and correct as of the date hereof;

 

(f)         The
Company (or a Subsidiary of the Company) shall have borrowed (or be concurrently borrowing) the Loan with respect to the Property,
as contemplated by the loan documents (the “Loan Documents”); and

 

(g)         The
form of Backstop Agreement shall have been approved by, and executed by, the applicable parties and delivered to Bluerock.

 

4.2         Carroll
Conditions. The obligation of Carroll to consummate the transactions contemplated herein and to make the initial Capital Contributions
under Section 5.1 is subject to fulfillment of all of the following conditions on or prior to the closing date under the
Purchase Agreement:

 

(a)         Subject
to the terms of the Cost Sharing Agreement, Bluerock shall deposit into the Company’s bank account or Title Company’s
designated escrow account the amount of its aggregate initial Capital Contribution set forth on Exhibit A hereto;

 

(b)         The
Purchase Agreement shall have been assigned to the Company (or to one or more Subsidiaries of the Company);

 

(c)         The
Cost Sharing Agreement has been executed and Bluerock and its affiliates are in full compliance with the terms thereof;

 

(d)         The
Company (or a Subsidiary of the Company) shall have borrowed (or be concurrently borrowing) the Loan with respect to the Property,
contemplated by the Loan Documents;

 

(e)         The
Management Agreement for the Property shall have been executed between the Company (or a Subsidiary of the Company) and Property
Manager;

 

(f)         All
of the representations and warranties of Bluerock contained in this Agreement and the Collateral Agreements shall be true and correct
as of the date hereof; and

 

(g)         The
form of Backstop Agreement shall have been approved by, and executed by, the applicable parties and delivered to Carroll.

 

		Section 5.	Capital Contributions, Loans, Percentage Interests
and Capital Accounts.

 

5.1         Initial
Capital Contributions. Subject to satisfaction of the conditions set forth in Section 4, upon execution of this Agreement,
Bluerock and Carroll shall each make an initial Capital Contribution to the Company of cash in an amount equal to the respective
amounts set forth in Exhibit A attached hereto; provided, however, any funds advanced by Bluerock or Carroll (or their respective
affiliates) pursuant to the terms of the Cost Sharing Agreement shall be credited against the applicable Member’s obligation
and provided, further, in the case of Carroll, its initial Capital Contribution to the Company shall be credited with $341,250
for the agreed value of certain contractual rights and intangibles contributed to the Company, including the assignment of the
purchase agreement to acquire the Property to the Company or one or more of its Subsidiaries.1 The initial Capital Contribution
of the Members to the Company may include amounts for working capital.

 

 

1
At closing of the acquisition of the Property, $341,250 shall be added to the required equity for closing and each Member shall
be responsible for funding its pro-rata share of such amount at the closing as part of its Initial Capital Contribution according
to its Percentage Interest; provided, Carroll’s required Initial Capital Contribution shall be net of the credit amount provided
in Section 5.1.

 

    	 	 -13-	 

     

    

 

5.2         Additional
Capital Contributions.

 

(a)         Additional
Capital Contributions may be called for from the Members (i) by either Member if the same is a Protective Capital Call, or
(ii) as reasonably determined by the Management Committee, by written notice to the Members from time to time as and to the
extent capital is necessary to effect an investment or expenditures for the Property, the Company, or its Subsidiaries. Except
as otherwise agreed by the Members, such additional Capital Contributions shall be in an amount for each Member equal to the product
of the amount of the aggregate Capital Contribution called multiplied by each Member’s then current Percentage Interest.
Such additional Capital Contributions shall be payable by the Members to the Company upon the earlier of (i) twenty (20) days after
written request from the Company, or (ii) the date when the Capital Contribution is required, as set forth in a written request
from the Company.

 

(b)         If
a Member (a “Defaulting Member”) fails to make a Capital Contribution that is required as provided in Section
5.2(a) within the time frame required therein (the amount of the failed contribution and related loan shall be the “Default
Amount”), the other Member, provided that it has made the Capital Contribution required to be made by it, in addition
to any other remedies it may have hereunder or at law, shall have one or more of the following remedies:

 

(1)         to
advance to the Company on behalf of, and as a loan to the Defaulting Member, an amount equal to the Default Amount to be evidenced
by a promissory note in form reasonably satisfactory to the non-failing Member (each such loan, a “Default Loan”).
The Capital Account of the Defaulting Member shall be credited with the amount of such Default Amount attributable to a Capital
Contribution and the aggregate of such amounts shall constitute a debt owed by the Defaulting Member to the non-failing Member.
Any Default Loan shall bear interest at the rate of twenty percent (20%) per annum, but in no event in excess of the highest rate
permitted by applicable laws (the “Default Loan Rate”), and shall be payable by the Defaulting Member on demand
from the non-failing Member and from any Distributions due to the Defaulting Member hereunder. Interest on a Default Loan, to the
extent unpaid, shall accrue and compound on a quarterly basis. A Default Loan shall be prepayable, in whole or in part, at any
time or from time to time without penalty. Any such Default Loans shall be with full recourse to the Defaulting Member and shall
be secured by the Defaulting Member’s interest in the Company including, without limitation, such Defaulting Member’s
right to Distributions. In furtherance thereof, upon the making of any such Default Loan, the Defaulting Member hereby pledges,
assigns and grants a security interest in its Interest to the non-failing Member and agrees to promptly execute such documents
and statements reasonably requested by the non-failing Member to further evidence and secure such security interest. Any advance
by the non-failing Member on behalf of a Defaulting Member pursuant to this Section 5.2(b)(1) shall be deemed to be a Capital
Contribution made by the Defaulting Member except as otherwise expressly provided herein. All Distributions to the Defaulting Member
hereunder shall be applied first to payment of any interest due under any Default Loan and then to principal until all amounts
due thereunder are paid in full. While any Default Loan is outstanding, the Company shall be obligated to pay directly to the non-failing
Member, for application to and until all Default Loans have been paid in full, the amount of (x) any Distributions payable to the
Defaulting Member, and (y) any proceeds of the sale of the Defaulting Member’s Interest in the Company;

 

    	 	 -14-	 

     

    

 

(2)         subject
to any applicable thin capitalization limitations on indebtedness of the Company for U.S. federal income tax purposes, to treat
the non-failing Member’s portion of such Capital Contribution as a loan to the Company (rather than a Capital Contribution)
and to advance to the Company as a loan to the Company an amount equal to the Default Amount, which loan shall be evidenced by
a promissory note in form reasonably satisfactory to the non-failing Member and which loan shall bear interest at the Default Loan
Rate and be payable on a first priority basis by the Company from available Cash Flow and prior to any Distributions made to any
Member. If each Member has loans outstanding to the Company under this provision, such loans shall be payable to each Member in
proportion to the outstanding balances of such loans to each Member at the time of payment. Any advance to the Company pursuant
to this Section 5.2(b)(2) shall not be treated as a Capital Contribution made by the Defaulting Member;

 

(3)         to
make an additional Capital Contribution to the Company equal to the Default Amount whereupon the Percentage Interests of the Members
shall be recalculated to (i) increase the non-defaulting Member’s Percentage Interest by the percentage (“Applicable
Adjustment Percentage”) determined by dividing one hundred fifty percent (150%) of the Default Amount by the sum of the
Members’ Total Investment (taking into account the actual amount of such additional Capital Contribution) and by increasing
its Total Investment solely for purposes of determining the Member’s Percentage Interest, by one and one-half of the amount
of the Default Amount, and (ii) to reduce the Defaulting Member’s Percentage Interest by the Applicable Adjustment Percentage
and by decreasing its Total Investment solely for purposes of determining the Member’s Percentage Interest by one-half of
the amount of the Default Amount; or

 

(4)         in
lieu of the remedies set forth in subparagraphs (1), (2) or (3), revoke its portion of such additional Capital Contribution, whereupon
the portion of the Capital Contribution made by the non-failing Member shall be returned within ten (10) days.

 

    	 	 -15-	 

     

    

 

(c)         Notwithstanding
the foregoing provisions of this Section 5.2, no additional Capital Contributions shall be required from any Member if (i)
the Company or any other Person shall be in default (or with notice or the passage of time or both, would be in default) in any
material respect under any loan, indenture, mortgage, non-residential lease, agreement or instrument to which the Company or any
of its Subsidiaries is a party or by which the Company (or any of its Subsidiaries) or any of its properties or assets is or may
be bound, (ii) any other Member, the Company or any of its Subsidiaries shall be insolvent or bankrupt or in the process of liquidation,
termination or dissolution, (iii) any other Member, the Company or any of its Subsidiaries shall be subjected to any pending litigation
(x) in which the amount in controversy exceeds $500,000, (y) which litigation is not being defended by an insurance company who
would be responsible for the payment of any judgment in such litigation, and (z) which litigation if adversely determined could
have a material adverse effect on such other Member and/or the Company or any of its Subsidiaries and/or could interfere with their
ability to perform their obligations hereunder or under any Collateral Agreement, or (iv) there has been a material adverse change
in (including, but not limited to, the financial condition of) any other Member (and/or its Affiliates) which, in such Member’s
reasonable judgment, prevents such other Member (and/or its Affiliates) from performing, or substantially interferes with their
ability to perform, their obligations hereunder or under any Collateral Agreement. If any of the foregoing events shall have occurred
and any Member elects not to make a Capital Contribution on account thereof, then any other Member which has made its pro rata
share of such Capital Contribution shall be entitled to a return of such Capital Contribution from the Company.

 

5.3         Percentage
Ownership Interest. The Members shall have the initial percentage ownership interests (as the same are adjusted as provided
in this Agreement, a “Percentage Interest”) in the Company set forth on Exhibit A immediately following
the Capital Contributions provided for in Section 5.1. The Percentage Interests of the Members in the Company shall be adjusted
monthly, and if appropriate to reflect any pending adjustments that have been determined but not yet effected, prior to any request
for Additional Capital Contributions pursuant to Section 5.2 or any distributions to Members pursuant to Section 6.1,
so that the respective Percentage Interests of the Members at any time shall be in proportion to their respective cumulative Total
Investment made (or deemed to be made) pursuant to Sections 5.1 and 5.2, as the same may be further adjusted pursuant
to Section 5.2(b)(3). Percentage Interests shall not be adjusted by Distributions made (or deemed made) to a Member.

 

5.4         Return
of Capital Contribution. Except as approved by each of the Members, no Member shall have any right to withdraw or make a demand
for withdrawal of the balance reflected in such Member’s Capital Account (as determined under Section 5.6) until the
full and complete winding up and liquidation of the business of the Company.

 

5.5         No
Interest on Capital. Interest earned on Company funds shall inure solely to the benefit of the Company, and no interest shall
be paid upon any Capital Contributions nor upon any undistributed or reinvested income or profits of the Company.

 

    	 	 -16-	 

     

    

 

5.6         Capital
Accounts. A separate capital account (the “Capital Account”) shall be maintained for each Member in accordance
with Section 1.704-1(b)(2)(iv) of the Regulations. Without limiting the foregoing, the Capital Account of each Member shall be
increased by (i) the amount of any Capital Contributions made by such Member, (ii) the amount of Income allocated to such
Member and (iii) the amount of income or profits, if any, allocated to such Member not otherwise taken into account in this Section
5.6. The Capital Account of each Member shall be reduced by (i) the amount of any cash and the fair market value of any property
distributed to the Member by the Company (net of liabilities secured by such distributed property that the Member is considered
to assume or take subject to), (ii) the amount of Loss allocated to the Member and (iii) the amount of expenses or losses, if any,
allocated to such Member not otherwise taken into account in this Section 5.6. The Capital Accounts of the Members shall
not be increased or decreased pursuant to Regulations Section 1.704-1(b)(2)(iv)(f) to reflect a revaluation of the Company’s
assets on the Company’s books in connection with any contribution of money or other property to the Company pursuant to Section
5.2 by existing Members. If any property other than cash is distributed to a Member, the Capital Accounts of the Members shall
be adjusted as if such property had instead been sold by the Company for a price equal to its fair market value, the gain or loss
allocated pursuant to Section 7, and the proceeds distributed in the manner set forth in Section 6.1 or Section
13.3(d)(3). No Member shall be obligated to restore any negative balance in its Capital Account. No Member shall be compensated
for any positive balance in its Capital Account except as otherwise expressly provided herein. The foregoing provisions and the
other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with the provisions of
Regulations Section 1.704-1(b)(2) and shall be interpreted and applied in a manner consistent with such Regulations.

 

5.7         New
Members. Upon approval by Bluerock and Carroll, the Company may issue additional Interests and thereby admit a new Member or
Members, as the case may be, to the Company, only if such new Member (i) has delivered to the Company its Capital Contribution,
(ii) has agreed in writing to be bound by the terms of any Collateral Agreement (including the Backstop Agreement) and this Agreement
by becoming a party hereto, and (iii) has delivered such additional documentation as the Company shall reasonably require to so
admit such new Member to the Company. Without the prior written consent of each then-current Member, a new Member may not be admitted
to the Company if the Company would, or may, have in the aggregate more than one hundred (100) members. For purposes of determining
the number of members under this Section 5.7, a Person (the “beneficial owner”) indirectly owning an
interest in the Company through a partnership, grantor trust or S corporation (as such terms are used in the Code) (the “flow-through
entity”) shall be considered a member, but only if (i) substantially all of the value of the beneficial owner’s
interest in the flow-through entity is attributable to the flow-through entity’s interest (direct or indirect) in the Company
and (ii) in the sole discretion of the Management Committee, a principal purpose of the use of the flow-through entity is to permit
the Company to satisfy the 100-member limitation.

 

		Section 6.	Distributions.

 

6.1         Distribution
of Distributable Funds

 

(a)         The
Management Committee shall calculate and determine the amount of Distributable Funds for each applicable period. Except as provided
in Sections 5.2(b), 6.1 or 13.3 or otherwise provided hereunder, Distributable Funds, if any, shall be distributed
to the Members, on a monthly basis based on a calendar year, so long as the Loan is outstanding. Thereafter, such distributions
shall be made on the 15th day of each month or from time to time as determined by the Management Committee.

 

    	 	 -17-	 

     

    

 

(b)         Any
Distributions otherwise payable to a Member under this Agreement shall be applied first to satisfy amounts due and payable on account
of the indemnity and/or contribution obligations of such Member under this Agreement and/or any other agreement delivered by such
Member to the Company or any other Member but shall be deemed distributed to such Member for purposes of this Agreement.

 

(c)         During
the first twenty four (24) months of the Initial Term (as defined in the Management Agreement), if Distributable Funds for any
calendar quarter (to be determined as soon as reasonably practicable following the expiration of such calendar quarter) are insufficient
to satisfy the Minimum Return for all Members for such calendar quarter, then the Subordinated Property Management Fee due to Property
Manager for such calendar quarter pursuant to the Management Agreement shall be withheld from the Property Manager and treated
as Distributable Funds payable to the Members, up to the amount necessary to satisfy the Minimum Return for all Members for such
calendar quarter. The balance of any Subordinated Property Management Fee payable with respect to such calendar quarter, if any,
shall be paid to Property Manager in accordance with the Property Management Agreement. For the avoidance of doubt, no portion
of any Unsubordinated Property Management Fee shall be subject to this Section 6.1(c). The portions of the Subordinated
Property Management Fee withheld from the Property Manager and distributed to the Members pursuant to this Section shall be referred
to herein as the “Deferred Management Fee.” If Distributable Funds for any calendar quarter are independently
sufficient to meet the Minimum Return for such quarter with respect to all Members after payment of the Property Management Fee
to Property Manager with respect to such calendar quarter, then the Property Manager shall be entitled to payment of any existing
Deferred Management Fee from any excess Distributable Funds (i.e. Distributable Funds remaining after payment of the current quarter’s
Property Management Fee and the Minimum Return) from such calendar quarter prior to distribution of same to the Members, until
either such excess Distributable Funds for such quarter are exhausted or all Deferred Management Fee have been paid to Property
Manager, whichever first occurs. After the expiration of the first twenty four (24) months of the Initial Term: (i) prior to the
twentieth (20th) day of the twenty-fifth (25th) month of the Initial Term, the Members shall mutually determine
the balance remaining to be paid to the Members, if any, to satisfy the Minimum Return for the first twenty four (24) months of
the Initial Term (the “Minimum Return Balance”), (ii) the current month’s Property Management Fee shall be paid
on a monthly basis in accordance with the terms of the Management Agreement, and (iii) Distributable Funds remaining, if any, in
each calendar month shall be distributed first, to the Members, until the Minimum Return Balance is reduced to zero, and second,
to Property Manager until the balance of any Deferred Management Fee is reduced to zero. All Distributable Funds payable to the
Members (including any Distributable Funds payable to the Members prior to payment of any Deferred Management Fee to Property Manager)
shall be distributed according to the following priority:

 

(1)         First,
to the Members in proportion to their respective Percentage Interests until each Member shall realize through Distributions and
actually receive the Preferred Return; and

 

(2)         Second,
the balance, if any, of such Distributable Funds remaining after the Distributions pursuant to (1) above shall be distributed as
follows:

 

    	 	 -18-	 

     

    

 

		a.	if a Carroll Change Event has occurred, such Distributable Funds shall be distributed to the Members
in proportion to their Percentage Interests; and

 

		b.	if a Carroll Change Event has not occurred, such Distributable Funds shall be distributed as follows:
(A) first, an amount equal to thirty percent (30%) of such Distributable Funds shall be distributed to Carroll and an amount equal
to seventy percent (70%) of such Distributable Funds shall be distributed to Bluerock until Bluerock shall have actually realized
and received through Distributions the greater of (i) a fifteen percent (15%) Internal Rate of Return and (ii) a return on Bluerock
Capital Contributions equal to a 1.5x multiple thereof and (B) thereafter, an amount equal to forty percent (40%) of such Distributable
Funds shall be distributed to Carroll and an amount equal to sixty percent (60%) of such Distributable Funds shall be distributed
to Bluerock.

 

6.2         Distributions
in Kind. In the discretion of the Management Committee, Distributable Funds may be distributed to the Members in cash or in
kind and Members may be compelled to accept a distribution of any asset in kind even if the percentage of that asset distributed
to it exceeds a percentage of that asset that is equal to the percentage in which such Member shares in Distributions from the
Company. In the case of all assets to be distributed in kind, the amount of the Distribution shall equal the fair market value
of the asset distributed as determined by the Management Committee. In the case of a Distribution of publicly traded property,
the fair market value of such property shall be deemed to be the average closing price for such property for the thirty (30) day
period immediately prior to the Distribution, or if such property has not yet been publicly traded for thirty (30) days, the average
closing price of such property for the period prior to the Distribution in which the property has been publicly traded.

 

		Section 7.	Allocations.

 

7.1         Allocation
of Net Income and Net Losses Other than in Liquidation. Except as otherwise provided in this Agreement, Net Income and Net
Losses of the Company for each Fiscal Year shall be allocated among the Members in a manner such that, as of the end of such Fiscal
Year and taking into account all prior allocations of Net Income and Net Losses of the Company and all Distributions made by the
Company through such date, the Capital Account of each Member is, as nearly as possible, equal to the Distributions that would
be made to such Member pursuant to Section 6.1 if the Company were dissolved, its affairs wound up and assets sold for cash equal
to their tax basis (or book value in the case of assets that have been revalued in accordance with Section 704(b) of the Code),
all Company liabilities were satisfied, and the net assets of the Company were distributed in accordance with Section 6.1
immediately after such allocation.

 

7.2         Allocation
of Net Income and Net Losses in Liquidation. Net Income and Net Losses realized by the Company in connection with the liquidation
of the Company pursuant to Section 13 shall be allocated among the Members in a manner such that, taking into account all
prior allocations of Net Income and Net Losses of the Company and all Distributions made by the Company through such date, the
Capital Account of each Member is, as nearly as possible, equal to the amount which such Member is entitled to receive pursuant
to Section 13.3(d)(3).

 

    	 	 -19-	 

     

    

 

7.3         U.S.
Tax Allocations.

 

(a)         Subject
to Section 704(c) of the Code, for U.S. federal and state income tax purposes, all items of Company income, gain, loss, deduction
and credit shall be allocated among the Members in the same manner as the corresponding item of income, gain, loss, deduction or
credit was allocated pursuant to the preceding paragraphs of this Section 7.

 

(b)         In
accordance with Code Section 704(c) and the Treasury regulations promulgated thereunder, income and loss with respect to any property
contributed to the capital of the Company (including, if the property so contributed constitutes a partnership interest, the applicable
distributive share of each item of income, gain, loss, expense and other items attributable to such partnership interest whether
expressly so allocated or reflected in partnership allocations) shall, solely for U.S. federal income tax purposes, be allocated
among the Members so as to take account of any variation between the adjusted basis of such property to the Company for U.S. federal
income tax purposes and its Agreed Upon Value at the time of contribution. Such allocation shall be made in accordance with the
“traditional method” set forth in Regulations Section 1.704-3(b) unless the Members unanimously agree to another permissible
method under such Regulations.

 

(c)         Any
elections or other decisions relating to such allocations shall be made by the Members in any manner that reasonably reflects the
purpose and intention of this Agreement. Allocations pursuant to this Section 7.3 are solely for purposes of U.S. federal,
state and local income taxes and shall not affect, or in any way be taken into account in computing, any Member’s share of
Net Income, Net Loss, other items or distributions pursuant to any provisions of this Agreement.

 

		Section 8.	Books, Records, Tax Matters and Bank Accounts.

 

8.1         Books
and Records. The books and records of account of the Company shall be maintained in accordance with industry standards and
shall be based on the Property Manager Reports. The books and records shall be maintained at the Company’s principal office
or at a location designated by the Management Committee, and all such books and records (and the dealings and other affairs of
the Company and its Subsidiaries) shall be available to any Member at such location for review, investigation, audit and copying,
at such Member’s sole cost and expense, during normal business hours on at least twenty-four (24) hours prior notice. In
connection with such review, investigation or audit, such Member (and its representatives and agents) shall have the unfettered
right to meet and consult with any and all employees of Property Manager (or any of their respective Affiliates) and to attend
meetings and independently meet and consult with any and all third parties having dealings or any other relationship with the Company
or any of its Subsidiaries or with Property Manager in respect of the Company or any of its Subsidiaries.

 

8.2         Reports
and Financial Statements.

 

(a)         Within
thirty (30) days of the end of each Fiscal Year, the Manager shall cause each Member to be furnished with two sets of the following
additional annual reports computed as of the last day of the Fiscal Year:

 

    	 	 -20-	 

     

    

 

(1)         An
unaudited balance sheet of the Company;

 

(2)         An
unaudited statement of the Company’s profit and loss; and

 

(3)         A
statement of the Members’ Capital Accounts and changes therein for such Fiscal Year.

 

(b)         Within
fifteen (15) days of the end of each quarter of each Fiscal Year, and provided that any such request was made prior to the end
of the quarter, the Property Manager shall cause to be furnished to Bluerock such information as requested by Bluerock as is necessary
for any reporting requirements of the SOIFs, BR Growth, or BR Growth II (to the extent any of such affiliates of Bluerock are hereafter
a Member or direct or indirect owner of a Member of the Company) and any reporting requirements of any REIT Member (whether a direct
or indirect owner) to determine its qualification as a REIT and its compliance with REIT Requirements as shall be reasonably requested
by Bluerock. Further, the Property Manager shall cooperate in a reasonable manner at the request of any Member to work in good
faith with any designated accountants or auditors of such Member or its Affiliates so that such Member or its Affiliate is able
to comply with its public reporting, attestation, certification and other requirements under the Securities Exchange Act of 1934,
as amended, applicable to such entity, and to work in good faith with the designated accountants or auditors of the Member or any
of its Affiliates in connection therewith, including for purposes of testing internal controls and procedures of such Member or
its Affiliates.

 

(c)         The
Members acknowledge that the Property Manager is obligated to perform Property-related accounting and furnish Property-related
accounting statements under the terms of the Management Agreement (the “Property Manager Reports”). Manager
shall be entitled to rely on the Property Manager Reports with respect to its obligations under this Section 8, and the
Members acknowledge that the reports to be furnished shall be based on the Property Manager Reports, without any duty on the part
of the Manager to further investigate the completeness, accuracy or adequacy of the Property Manager Reports.

 

8.3         Tax
Matters Member. Bluerock is hereby designated as the “tax matters partner” of the Company and the Subsidiaries,
as defined in Section 6231(a)(7) of the Code (the “Tax Matters Member”) and shall prepare or cause to be prepared
all income and other tax returns of the Company and its Subsidiaries pursuant to the terms and conditions of Section 8.5.
Except as otherwise provided in this Agreement, all elections required or permitted to be made by the Company and its Subsidiaries
under the Code or state tax law shall be timely determined and made by Bluerock after consultation with Carroll. The Members intend
that the Company be treated as a partnership for U.S. federal, state and local tax purposes, and the Members will not elect or
authorize any person to elect to change the status of the Company from that of a partnership for U.S. federal, state and local
income tax purposes. Bluerock agrees to consult with Carroll with respect to any written notice of any material tax elections and
any material inquiries, claims, assessments, audits, controversies or similar events received from any taxing authority. In addition,
upon the request of any Member, the Company and each of its Subsidiaries shall make an election pursuant to Code Section 754 to
adjust the basis of the Company’s property in the manner provided in Code Sections 734(b) and 743(b). The Company hereby
indemnifies and holds harmless Bluerock from and against any claim, loss, expense, liability, action or damage resulting from its
acting or its failure to take any action as the “tax matters partner” of the Company and its Subsidiaries, provided
that any such action or failure to act does not constitute gross negligence or willful misconduct by Bluerock.

 

    	 	 -21-	 

     

    

 

8.4         Bank
Accounts. All funds of the Company are to be deposited in the Company’s name in such bank account or accounts as may
be designated by the Management Committee or in the Management Agreement and shall be withdrawn on the signature of such Person
or Persons as the Management Committee may authorize.

 

8.5         Tax
Returns. Bluerock shall cause to be prepared all income and other tax returns of the Company and its Subsidiaries required
by applicable law and shall submit such returns to the Management Committee for its review, comment and approval at least twenty
(20) days prior to the due date or extended due date thereof and shall thereafter cause the same to be filed in a timely manner
(including extensions). No later than the due date or extended due date, Manager shall deliver or cause to be delivered to each
Member a copy of the tax returns for the Company and such Subsidiaries with respect to such Fiscal Year, together with such information
with respect to the Company and such Subsidiaries as shall be necessary for the preparation by such Member of its U.S. federal
and state income or other tax and information returns.

 

8.6         Expenses.
Notwithstanding any contrary provision of this Agreement, the Members acknowledge and agree that the reasonable expenses and charges
incurred directly or indirectly by or on behalf of the Manager, Bluerock, Carroll or the Property Manager in connection with its
obligations under this Section 8 will be reimbursed by the Company to the applicable party. Further, it is expressly understood
and agreed that all reasonable expenses of Bluerock, Carroll and their principals and Affiliates associated with the Company or
the Property, along with all accounting and administrative expenses for Carroll, shall be reimbursed by the Company, including
without limitation, filing fees, tax returns, closing costs, due diligence and travel.

 

		Section 9.	Management and Operations.

 

9.1         Management.

 

(a)         The
Company shall be managed by Bluerock (“Manager”), who shall have the authority to exercise all of the powers
and privileges granted by the Act, any other law or this Agreement, together with any powers incidental thereto, and to take any
other action not prohibited under the Act or other applicable law, so far as such powers or actions are necessary or convenient
or related to the conduct, promotion or attainment of the business, purposes or activities of the Company. Manager shall manage
the operations and affairs of the Company, subject to the oversight of the Management Committee. To the extent that Bluerock or
a Bluerock Transferee Transfers all or a portion of its Interest in accordance with Section 12 to a Bluerock Transferee,
such Bluerock Transferee may be appointed as the Manager under this Section 9.1(a) by Bluerock or a Bluerock Transferee
then holding all or a portion of an Interest without any further action or authorization by any Member.

 

    	 	 -22-	 

     

    

 

(b)         The
Management Committee may appoint individuals to act on behalf of the Company with such titles and authority as determined from
time to time by the Management Committee.

 

(c)         Notwithstanding
the foregoing, all Major Decisions shall require the consent of both Members.

 

9.2         Management
Committee.

 

(a)         Bluerock
and Carroll hereby establish a management committee (the “Management Committee”). The Management Committee shall
consist of four (4) individuals appointed to act as “representatives” of the Member that appointed him or her (the
“Representatives”) as follows: (i) Bluerock shall be entitled to designate two (2) Representatives to represent
Bluerock; and (ii) Carroll shall be entitled to designate two (2) Representatives to represent Carroll. The initial members of
the Management Committee are set forth on Exhibit A. Bluerock and Carroll each represents, warrants and covenants that the
Representatives designated by them on Exhibit A have, and shall at all times have, the full power and authority to make
decisions and vote as a member of the Management Committee, and that such Representatives’ votes as members of the Management
Committee will be binding on each of them and any transferee of all or a portion of their Interest; unless and until such time
as Bluerock or Carroll or their transferee notifies the other Member of a change in a Representative, after which time this sentence
shall apply only with respect to the replacement Representative.

 

(b)         Each
member of the Management Committee shall hold office until death, resignation or removal at the pleasure of the Member that appointed
him or her. If a vacancy occurs on the Management Committee, the Person with the right to appoint and remove such vacating Representative
shall appoint his or her successor. A Member shall lose its right to have Representatives on the Management Committee, and its
Representatives on the Management Committee shall be deemed to be automatically removed, as of the date on which such Member ceases
to be a Member or as otherwise provided in this Agreement. If Bluerock or a Bluerock Transferee Transfers all or a portion of its
Interest to a Bluerock Transferee pursuant to Section 12.2, such Bluerock Transferee shall automatically, and without any
further action or authorization by any Member, succeed to the rights and powers of Bluerock under this Section 9 as may
be agreed to between Bluerock or the Bluerock Transferee which is transferring the Interest, on the one hand, and the Bluerock
Transferee to which the Interest is being transferred, on the other hand, including the shared or unilateral right to appoint the
Representatives that Bluerock was theretofore entitled to appoint pursuant to Section 9.2(a).

 

(c)         The
Management Committee shall meet once every quarter (unless waived by mutual agreement of the Members) and at such other times as
may be necessary for the conduct of the Company’s business on at least five (5) days prior written notice of the time and
place of such meeting given by any Representative. Notice of regular meetings of the Management Committee is not required. Representatives
may waive in writing the requirements for notice before, at or after a special meeting, and attendance at such a meeting without
objection by a Representative shall be deemed a waiver of such notice requirement.

 

    	 	 -23-	 

     

    

 

(d)         The
Management Committee shall have the right, but not the obligation, to elect one of the Representatives or another person to serve
as Secretary of the Management Committee. Such person shall hold office until his or her death, resignation or removal by a vote
of the Management Committee. The Secretary or a person designated by him or her shall take written minutes of the proceedings of
the meetings of the Management Committee, and such minutes shall be filed with the records of the Company.

 

(e)         The
only Representatives required to constitute a quorum for a meeting of the Management Committee shall be one (1) Representative
appointed by Bluerock and one (1) Representative appointed by Carroll; provided, however, that if Carroll has not appointed at
least one (1) Representative to the Management Committee at the time of such meeting (for example, if each Carroll Representative
has been removed and not replaced), then a quorum for a meeting of the Management Committee shall be one (1) Representative appointed
by Bluerock. Each of the two (2) Representatives appointed by Bluerock shall be entitled to cast two (2) votes on any matter that
comes before the Management Committee and each of the Representatives appointed by Carroll shall be entitled to cast one (1) vote
on any matter that comes before the Management Committee. Approval by the Management Committee of any matter shall require the
affirmative vote (including votes cast by proxy) of at least a majority of the votes of the Representatives then in office voting
at a duly held meeting of the Management Committee.

 

(f)         Any
meeting of the Management Committee may be held by conference telephone call, video conference or through similar communications
equipment by means of which all persons participating in the meeting can communicate with each other. Participation in a telephonic
and/or video conference meeting held pursuant to this Section 9 shall constitute presence in person at such meeting.

 

(g)         Any
action required or permitted to be taken at a meeting of the Management Committee may be taken without a meeting, without prior
notice and without a vote if a consent or consents in writing, setting forth the action so taken, shall be signed by the Representatives
having not less than the minimum of votes that would be necessary to authorize or take such action at a meeting at which all Representatives
entitled to vote thereon were present and voted. All consents shall be filed with the minutes of the proceedings of the Management
Committee.

 

(h)         Except
as otherwise expressly provided in this Agreement, none of the Members or their Representatives (in their capacities as members
of the Management Committee) only, shall have any duties or liabilities to the Company or any other Member (including any fiduciary
duties), whether or not such duties or liabilities otherwise arise or exist in law or in equity, and each Member hereby expressly
waives any such duties or liabilities; provided, however, that this Section 9.2(h) shall not eliminate or
limit the liability of such Representatives or the Members (A) for acts or omissions that involve fraud, intentional misconduct
or a knowing and culpable violation of law, or (B) for any transaction not permitted or authorized under or pursuant to this Agreement
from which such Representative or Member derived a personal benefit unless the Management Committee has approved in writing such
transaction in accordance with this Agreement; provided, further, however, that the duty of care of each of
such Representatives and the Members is to not act with fraud, intentional misconduct or a knowing and culpable violation of law.
Except as provided in this Agreement, whenever in this Agreement a Representative of a Member and/or a Member is permitted or required
to make a decision affecting or involving the Company, any Member or any other Person, such Representative and/or such Member shall
be entitled to consider only such interests and factors as he, she or it desires, including a particular Member’s interests,
and shall, to the fullest extent permitted by applicable law, have no duty or obligation to give any consideration to any interest
of or factors affecting the Company or any Member.

 

    	 	 -24-	 

     

    

 

9.3         Annual
Business Plan.

 

(a)         The initial Annual
Business Plan for the period from the date of this Agreement through the end of calendar year 2016, which is deemed approved by
the Property Manager and the Owner with respect to the Property, and is attached hereto as Exhibit D and is incorporated
herein for all intents and purposes under this Agreement (the “Initial Business Plan”). The foregoing notwithstanding,
the Manager has also delivered to Owner on or before September 23, 2016, the proposed Annual Business Plan for the calendar year
2017.

 

(b)         In addition to the
Annual Business Plan for calendar year 2017 prepared by the Property Manager and delivered to Owner prior to the date of this Agreement
in accordance with the preceding Section, Property Manager shall prepare the Annual Business Plan for the calendar year 2018 for
the operation of the Property for the Owner’s review and approval, no later than September 15 of the immediately preceding
year for the 2018 calendar year (and any subsequent) Annual Business Plan. If final approval of an Annual Business Plan (including
the 2017 Annual Business Plan) by the Owner has not been given by the beginning of the year to which such proposed Annual Business
Plan relates, Property Manager shall operate the Property on the basis of the previous year’s approved Annual Business Plan
adjusted by (i) assuming that the revenue from the Property will increase to 103% of the revenues collected in the prior year,
(ii) assuming that the Controllable Expenses will increase to 103% of the amount of the actual Controllable Expenses incurred in
the prior year, (iii) increasing all Uncontrollable Expenses by any anticipated or known increases in such Uncontrollable Expenses,
and (iv) including any Emergency Expenditure. Notwithstanding the foregoing to the contrary, if, prior to the commencement of calendar
year 2017, the parties have not agreed on the budget for capital expenditures at the Property in the Annual Business Plan for calendar
year 2017, there shall be no budgeted capital expenditures for calendar year 2017; provided, however, that any incomplete capital
projects commenced in calendar year 2016 and contemplated in the Initial Business Plan shall be funded as provided in the Initial
Business Plan until such capital projects are completed.

 

(c)         If Property Manager
and the Owner agreed to an Annual Business Plan for calendar year 2018 in accordance with subsection (b) above, then the Annual
Business Plan for calendar year 2019 shall also be determined in accordance with the applicable provisions of subsection (b) above.
If, however, Property Manager and the Owner were unable to agree to an Annual Business Plan for calendar year 2018, then such Owner
may establish the Annual Business Plan for calendar year 2019, without Property Manager’s consent.

 

(d)         For the Annual Business
Plan for calendar years 2020 and all subsequent calendar years, if applicable, Property Manager shall have the right to prepare
and propose an Annual Business Plan for such calendar year on or prior to September 15 of the immediately preceding year (without
obligation to do so), and the Owner may, regardless of the information contained in Property Manager’s proposal, establish
the Annual Business Plan for the applicable calendar year, without Property Manager’s consent.

 

    	 	 -25-	 

     

    

 

(e)         Property Manager and
the Company, on behalf of the Owner, each acknowledge and agree that, in establishing the Annual Business Plan in accordance with
this Section 9.3, each shall be obligated to act reasonably and in good faith, taking into account past performance of the
Property, leasing trends and competitive properties within the market where the Property is located, the age of the Property and
the units at the time such Annual Business Plan is established, and such other factors as reasonably prudent owners and managers
of multifamily assets substantially similar to the Property would take into account in order to maximize revenue therefrom.

 

(f)         No Material Deviations
(as defined herein) from any item in an Annual Business Plan approved in accordance with the terms herein shall be made by Property
Manager without the prior approval of the Management Committee, to the extent required hereunder. The Property Manager shall provide
quarterly updates to each Annual Business Plan, solely for informational purposes. Each Annual Business Plan shall include the
information set forth in Exhibit B. The Company, for itself and on behalf of the Owner, will consider a proposed Annual
Business Plan in accordance with the terms hereof and will consult with Property Manager prior to the commencement of the forthcoming
calendar year in order to agree on an Annual Business Plan for such calendar year. In no event shall the Company, acting on behalf
of an Owner, have the right to modify (or alter the treatment of) any Annual Business Plan to reduce the Property Management Fee
or Reimbursable Expenses otherwise due. In no event shall Property Manager be deemed in default under any Management Agreement
if such changes by the Company, acting on behalf of the Owner, to an Annual Business Plan cause Property Manager to have insufficient
funds to perform its obligations thereunder. Property Manager agrees to use commercially reasonable efforts to ensure that the
actual costs of maintaining and operating the Property shall not exceed the amount reasonably necessary and, in any event, will
not exceed the applicable Annual Business Plan either in total amount or in any one accounting category. Notwithstanding anything
to the contrary, Property Manager shall secure the Company’s, on behalf of the Owner, prior written approval for any expenditure
that will result in an excess of the annual budgeted amount set forth in the Annual Business Plan in any one accounting category
by the lesser of ten percent (10%) or $10,000 or $25,000 in the aggregate for all categories (a “Material Deviation”).
Property Manager shall promptly advise and inform the Company, acting on behalf of the Owner, of any transaction, notice, event
or proposal directly relating to the management and operation of the Property which does or is likely to significantly affect,
either adversely or favorably, the Property, other assets of the Owner or cause a Material Deviation from the applicable Annual
Business Plan. Nothing contained herein shall in any way diminish the obligations or duties of Property Manager hereunder.

 

(g)         Notwithstanding the
terms of Section 9.3(a) through Section 9.3(f) above, (i) any Annual Business Plan may, at any time, be amended upon
unanimous approval by the Members, and (ii) failure on the part of the Members to agree on any such Annual Business Plan (or any
amendment thereto) shall not constitute the failure to obtain agreement on a Major Decision and shall not entitle either Member
to exercise the rights under Section 15 applicable to a failure to obtain agreement on Major Decisions.

 

    	 	 -26-	 

     

    

 

(h)         For all purposes of
this Section 9.3, decisions on behalf of the Owner shall be made by the Management Committee.

 

9.4         Implementation
of Plan by Property Manager. Property
Manager shall, subject to the limitations contained herein, the availability of operating revenues and other cash flow and any
other matters outside of the reasonable control of Property Manager, implement and shall not vary or modify the then applicable
Annual Business Plan without the prior written approval of the Management Committee. Property Manager shall promptly advise and
inform the Management Committee of any transaction, notice, event or proposal directly relating to the management and operation
of the Property, other assets of the Company or the Company or any Subsidiary of the Company which does or is likely to significantly
affect, either adversely or favorably, such Property, other assets of the Company or the Company or such Subsidiary or cause a
significant deviation from the applicable Annual Business Plan. Nothing contained herein shall in any way diminish the obligations
or duties of Property Manager hereunder.

 

9.5         Affiliate
Transactions. No agreement shall be entered into by the Company or any Subsidiary with a Member or any Affiliate of a Member
and no decision shall be made in respect of any such agreement (including, without limitation, the enforcement or termination thereof)
unless such agreement or related decision shall have been approved in writing by all Members. Without limiting the foregoing, any
such agreement shall be on arm’s length terms and conditions, be terminable on fifteen (15) days’ notice without penalty
and the terms and conditions of such agreement shall be disclosed to all Representatives prior to the execution and delivery thereof.
Further, the written approval of Bluerock shall be required prior to the use of the name “Bluerock” in connection with
any matter or transaction.

 

9.6         Other
Activities.

 

(a)         Right
to Participation in Other Member Ventures. Neither the Company nor any Member (or any Affiliate of any Member) shall have any
right by virtue of this Agreement either to participate in or to share in any other now existing or future ventures, activities
or opportunities of any of the other Members or their Affiliates, or in the income or proceeds derived from such ventures, activities
or opportunities.

 

(b)         Limitation
on Actions of Members; Binding Authority. No Member shall, without the prior written consent of the other Members, take any
action on behalf of, or in the name of, the Company, or enter into any contract, agreement, commitment or obligation binding upon
the Company, or, in its capacity as a Member or Manager of the Company, perform any act in any way relating to the Company or the
Company’s assets, except in a manner and to the extent consistent with the provisions of this Agreement.

 

9.7         Management
Agreement.

 

(a)         Independent
Contractor. CMG, as Property Manager, has agreed to provide management services to the Company (or a Subsidiary of the Company)
with respect to the Property on the terms set forth in the Management Agreement; and it is agreed that Property Manager shall provide
such management services to the Company (or a Subsidiary of the Company) as an independent contractor.

 

    	 	 -27-	 

     

    

 

(b)         Management
and Oversight Fees. The Company (or a Subsidiary of the Company) has entered into the Management Agreement with Property Manager
(which Management Agreement shall be updated and supplemented from time to time) pursuant to which Property Manager will provide
the management services described therein to the Company (or a Subsidiary of the Company). Pursuant to the Management Agreement
and subject to the terms of the Loan Documents, Property Manager will be entitled to receive a net property management fee equal
to 3.00% of Gross Receipts (as defined in the Management Agreement) (the “Property Management Fee”); provided,
however, that the payment and amount of the Property Management Fee shall be subject to the restrictions, limitations and language
regarding the deferral and subordination of such fee as described in Section 4(a) of the Management Agreement and in Section
6.1(c) herein. CMG, as Property Manager, shall also be entitled to a construction management fee of five percent (5.0%) of
any expenses incurred in connection with the original capital expenditure and plan attached as Exhibit G to the Management
Agreement. Any additional support (and any applicable compensation with respect thereto) for any capital improvements beyond those
set forth on Exhibit G to the Management Agreement shall be agreed to in advance by Owner and the Property Manager. If CMG
has been terminated as the Property Manager for Cause with respect to the Property, then Bluerock will be entitled to retain a
new Property Manager and receive an oversight fee equal to 1.0% of the Gross Receipts for such Property (the “Oversight
Fee”). It is understood that if CMG is terminated as the Property Manager without Cause, Bluerock shall not be entitled
to the Oversight Fee, unless Bluerock purchases the Interest of Carroll pursuant to Section 15 or otherwise by agreement
of the parties. The foregoing shall not be deemed to imply that Bluerock will have any unilateral right to purchase the Interest
of Carroll solely on account of the termination of CMG as Property Manager.

 

(c)         Termination
of Management Agreement.

 

(1)         The
Management Agreement shall be terminable as provided under its terms and conditions by the Company or Bluerock or, as long as the
Property Manager is CMG, by Property Manager.

 

(2)         Notwithstanding
anything to the contrary in this Section 9.7(c), no termination of a Management Agreement or buyout of the other party’s
Interest in the Company shall be permitted unless permitted or approved under any applicable Collateral Agreement or under the
Loan Documents.

 

(d)         Delegation.
Any delegation of the responsibilities of Property Manager or the subcontracting for such services will be subject to the prior
written consent of the Management Committee. Separate agreements may also be entered into with Carroll, Bluerock, their respective
Affiliates, or with third parties for certain services to be provided to the Company (or a Subsidiary of the Company), including
leasing, construction management, property management, asset management, technology services, etc. Such arrangements shall be at
market rates, and shall be entered into only with the prior written approval of the Management Committee, consistent with an approved
budget and business plan for each asset. Unless otherwise agreed, all such contracts will be payable on a monthly basis and will
be terminable upon thirty (30) days’ notice for any reason or no reason.

 

    	 	 -28-	 

     

    

 

9.8         Operation
in Accordance with REOC/REIT Requirements.

 

(a)         The Members acknowledge
that Bluerock or one or more of its Affiliates (a “BR Affiliate”) intends or may intend to qualify as a “real
estate operating company” or “venture capital operating company” within the meaning of U.S. Department of Labor
Regulation 29 C.F.R. §2510.3-101 (a “REOC”), and agree that the Company and its Subsidiaries shall in such case
be operated in a manner that will enable Bluerock and such BR Affiliate to so qualify. Notwithstanding anything herein to the contrary,
the Company and its Subsidiaries shall not take, or refrain from taking, any action that Bluerock notifies the Company would result
in Bluerock or a BR Affiliate from failing to qualify as a REOC. The Members acknowledge and agree that Bluerock may assign any
or all of its rights or powers under this Agreement as Manager, to designate committee representatives, to provide consents and
approvals, or any other rights or powers to one or more of its BR Affiliates as it deems appropriate, and the exercise of any such
rights or powers by a BR Affiliate shall have full force and effect under this Agreement without the need for any further consent
or approval. Except as disclosed to Bluerock, Carroll (a) shall not fund any Capital Contribution "with the 'plan assets'
of any 'employee benefit plan' within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
or any 'plan' as defined by Section 4975 of the Internal Revenue Code of 1986, as amended", and (b) shall comply with any
reasonable requirements specified by Bluerock in order to ensure compliance with this Section 9.8.

 

(b)         Except for the Property,
neither the Company nor its Subsidiaries shall hold any investment, incur any indebtedness or otherwise take any action that would
cause any Member of the Company (or any Person holding an indirect interest in the Company through an entity or series of entities
treated as partnerships for U.S. federal income tax purposes) to realize any “unrelated business taxable income” as
such term is defined in Code Sections 511 through 514, unless specifically agreed to by the Manager in writing. No Manager or Member
shall be liable for any income or other taxes, damages, costs or expenses incurred by the Company or any Member by reason of the
recognition by the Company of UBTI.

 

(c)         The Company (and
any direct or indirect Subsidiary of the Company) may not engage in any activities or hold any assets that would constitute or
result in the occurrence of a REIT Prohibited Transaction as defined herein. Notwithstanding anything to the contrary contained
in this Agreement, during the time a REIT Member is a Member of the Company, neither the Company, any direct or indirect Subsidiary
of the Company, nor any Member of the Company shall take or refrain from taking any action which, or the effect of which, would
constitute or result in the occurrence of a REIT Prohibited Transaction by the Company or any direct or indirect Subsidiary thereof,
including without limiting the generality of the foregoing, but in amplification thereof:

 

(i)          Entering into any
lease, license, concession or other agreement or permitting any sublease, license, concession or other agreement that provides
for rent or other payment based in whole or in part on the income or profits of any person, excluding for this purpose a lease
that provides for rent based in whole or in part on a fixed percentage or percentages of gross receipts or gross sales of any person
without reduction for any costs of the lessee (and in the case of a sublease, without reduction for any sublessor costs);

 

    	 	 -29-	 

     

    

 

(ii)         Leasing personal
property, excluding for this purpose a lease of personal property that is entered into in connection with a lease of real property
where the rent attributable to the personal property is less than 15% of the total rent provided for under the lease;

 

(iii)        Acquiring or holding
any debt investments, excluding for these purposes “debt” solely between wholly-owned Subsidiaries of the Company,
unless (I) the amount of interest income received or accrued by the Company under such loan does not, directly or indirectly, depend
in whole or in part on the income or profits of any person, and (II) the debt is fully secured by mortgages on real property or
on interests in real property. Notwithstanding anything to the contrary herein, in the case of debt issued to the Company by a
Subsidiary which is treated as a “taxable REIT subsidiary” of the REIT Member, such debt shall be secured by a mortgage
or similar security interest, or by a pledge of the equity ownership of a subsidiary of such taxable REIT subsidiary;

 

(iv)       Acquiring or holding,
directly or indirectly, more than 10% of the outstanding securities of any one issuer (by vote or value) other than an entity which
either (i) is taxable as a partnership or a disregarded entity for United States federal income tax purposes, (ii) has properly
elected to be a taxable REIT subsidiary of the REIT Member by jointly filing with REIT, IRS Form 8875, or (iii) has properly elected
to be a real estate investment trust for U.S. federal income tax purposes;

 

(v)         Entering into any
agreement where the Company receives amounts, directly or indirectly, for rendering services to the tenants of any property that
is owned, directly or indirectly, by the Company other than (i) amounts received for services that are customarily furnished or
rendered in connection with the rental of real property of a similar class in the geographic areas in which the Property is located
where such services are either provided by (A) an Independent Contractor (as defined in Section 856(d)(3) of the Code) who is adequately
compensated for such services and from which the Company or REIT Member do not, directly or indirectly, derive revenue or (B) a
taxable REIT subsidiary of REIT Member who is adequately compensated for such services or (ii) amounts received for services that
are customarily furnished or rendered in connection with the rental of space for occupancy only (as opposed to being rendered primarily
for the convenience of the Property’s tenants);

 

(vi)        Entering into any
agreement where a material amount of income received or accrued by the Company under such agreement, directly or indirectly, does
not qualify as either (i) “rents from real property” or (ii) “interest on obligations secured by mortgages on
real property or on interests in real property,” in each case as such terms are defined in Section 856(c) of the Code;

 

(vii)       Holding cash of
the Company available for operations or distribution in any manner other than a traditional bank checking or savings account;

 

    	 	 -30-	 

     

    

 

(viii)     Selling or disposing
of any property, subsidiary or other asset of the Company prior to (i) the completion of a two (2) year holding period with such
period to begin on the date the Company acquires a direct or indirect interest in such property and begins to hold such property,
subsidiary or asset for the production of rental income, and (ii) the satisfaction of any other requirements under Section 857
of the Code necessary for the avoidance of a prohibited transaction tax on the REIT; or

 

(ix)        Failing to make
current cash distributions to REIT Member each year in an amount which does not at least equal the taxable income allocable to
REIT Member for such year; provided, however, any such cash distributions shall be made in accordance with the priorities set forth
in Section 6.1(c).

 

Notwithstanding the foregoing
provisions of this Section 9.8(c), the Company may enter into a REIT Prohibited Transaction if it receives the prior written approval
of the REIT Member specifically acknowledging that the REIT Member is approving a REIT Prohibited Transaction pursuant to this
Section 9.8(c). For purposes of this Section 9.8(c), “REIT Prohibited Transactions” shall mean any of the actions specifically
set forth in Sections 9.8(c)(i) through (c)(ix) as well as any action of which the Company receives notice from Bluerock or a REIT
Member that such action would result in a REIT Member losing its REIT status under IRC Section 856 or would cause such REIT Member
to be subject to any punitive taxation pursuant to IRC Section 857(b)(6). The Loan or any loan contemplated by Section 5.2(b) shall
not be considered a REIT Prohibited Transaction.

 

9.9         FCPA.

 

(a)         In
compliance with the Foreign Corrupt Practices Act, each Member will not, and will ensure that its officers, directors, employees,
shareholders, members, agents and Affiliates, acting on its behalf or on the behalf of the Company or any of its Subsidiaries or
Affiliates do not, for a corrupt purpose, offer, directly or indirectly, promise to pay, pay, promise to give, give or authorize
the paying or giving of anything of value to any official representative or employee of any government agency or instrumentality,
any political party or officer thereof or any candidate for office in any jurisdiction, except for any facilitating or expediting
payments to government officials, political parties or political party officials the purpose of which is to expedite or secure
the performance of a routine governmental action by such government officials or political parties or party officials. The term
“routine governmental action” for purposes of this provision shall mean an action which is ordinarily and commonly
performed by the applicable government official in (i) obtaining permits, licenses, or other such official documents which such
Person is otherwise legally entitled to; (ii) processing governmental papers; (iii) providing police protection, mail pick-up and
delivery or scheduling inspections associated with contract performance or inspections related to transit of goods across country;
(iv) providing phone service, power and water supply, loading and unloading of cargo, or protecting perishable products or commodities
from deterioration; or (v) actions of a similar nature.

 

(b)         The
term routine governmental action does not include any decision by a government official whether, or on what terms, to award new
business to or to continue business with a particular party, or any action taken by an official involved in the decision making
process to encourage a decision to award new business to or continue business with a particular party.

 

    	 	 -31-	 

     

    

 

(c)         Each
Member agrees to notify immediately the other Member of any request that such Member or any of its officers, directors, employees,
shareholders, members, agents or Affiliates, acting on its behalf, receives to take any action that may constitute a violation
of the Foreign Corrupt Practices Act.

 

		Section 10.	Confidentiality.

 

10.1         Any
information relating to a Member’s business, operation or finances which are proprietary to, or considered proprietary by,
a Member are hereinafter referred to as “Confidential Information”. All Confidential Information in tangible form (plans,
writings, drawings, computer software and programs, etc.) or provided to or conveyed orally or visually to a receiving Member,
shall be presumed to be Confidential Information at the time of delivery to the receiving Member. All such Confidential Information
shall be protected by the receiving Member from disclosure with the same degree of care with which the receiving Member protects
its own Confidential Information from disclosure. Each Member agrees: (i) not to disclose such Confidential Information to any
Person except to those of its employees or representatives who need to know such Confidential Information in connection with the
conduct of the business of the Company and who have agreed to maintain the confidentiality of such Confidential Information and
(ii) neither it nor any of its employees or representatives will use the Confidential Information for any purpose other than in
connection with the conduct of the business of the Company; provided that such restrictions shall not apply if such Confidential
Information is or hereafter becomes public, other than by breach of this Agreement; was already in the receiving Member’s
possession prior to any disclosure of the Confidential Information to the receiving Member by the divulging Member; or has been
or is hereafter obtained by the receiving Member from a third party not bound by any confidentiality obligation with respect to
the Confidential Information; provided, further, that nothing herein shall prevent any Member from disclosing any
portion of such Confidential Information (1) to the Company and allowing the Company to use such Confidential Information in connection
with the Company’s business, (2) pursuant to judicial order or in response to a governmental inquiry, by subpoena or other
legal process, but only to the extent required by such order, inquiry, subpoena or process, and only after reasonable notice to
the original divulging Member, (3) as necessary or appropriate in connection with or to prevent the audit by a governmental agency
of the accounts of Carroll or Bluerock, (4) in order to initiate, defend or otherwise pursue legal proceedings between the parties
regarding this Agreement, (5) necessary in connection with a Transfer of an Interest permitted hereunder or (6) to a Member’s
respective attorneys or accountants or other representatives.

 

10.2         The
Members and their Affiliates shall each act to safeguard the secrecy and confidentiality of, and any proprietary rights to, any
non-public information relating to the Company and its business, except to the extent such information is required to be disclosed
by law or reasonably necessary to be disclosed in order to carry out the business of the Company. Each Member may, from time to
time, provide the other Members written notice of its non-public information which is subject to this Section 10.2.

 

    	 	 -32-	 

     

    

 

10.3         Without
limiting any of the other terms and provisions of this Agreement (including, without limitation, Section 9.6), to the extent
a Member (the “Pursuer”) provides the other Member with information relating to a possible investment opportunity
then being actively pursued by the Pursuer on behalf of the Company, the other Member receiving such information shall not use
such information to pursue such investment opportunity for its own account to the exclusion of the Pursuer so long as the Pursuer
is actively pursuing such opportunity on behalf of the Company and shall not disclose any Confidential Information to any Person
(except as expressly permitted hereunder) or take any other action in connection therewith that is reasonably likely to cause damage
to the Pursuer.

 

		Section 11.	Representations and Warranties.

 

11.1       In
General. As of the date hereof, each of the Members hereby makes each of the representations and warranties applicable to such
Member as set forth in Section 11.2. Such representations and warranties shall survive the execution of this Agreement.

 

11.2       Representations
and Warranties. Each Member hereby represents and warrants that:

 

(a)         Due
Incorporation or Formation; Authorization of Agreement. Such Member is a corporation duly organized or a partnership or limited
liability company duly formed, validly existing and in good standing under the laws of the jurisdiction of its incorporation or
formation and has the corporate, partnership or company power and authority to own its property and carry on its business as owned
and carried on at the date hereof and as contemplated hereby. Such Member is duly licensed or qualified to do business and in good
standing in each of the jurisdictions in which the failure to be so licensed or qualified would have a material adverse effect
on its financial condition or its ability to perform its obligations hereunder. Such Member has the corporate, partnership or company
power and authority to execute and deliver this Agreement and to perform its obligations hereunder, and the execution, delivery
and performance of this Agreement has been duly authorized by all necessary corporate, partnership or company action. This Agreement
constitutes the legal, valid and binding obligation of such Member.

 

(b)         No
Conflict with Restrictions; No Default. Neither the execution, delivery or performance of this Agreement nor the consummation
by such Member (or any of its Affiliates) of the transactions contemplated hereby (i) does or will conflict with, violate or result
in a breach of (or has conflicted with, violated or resulted in a breach of) any of the terms, conditions or provisions of any
law, regulation, order, writ, injunction, decree, determination or award of any court, any governmental department, board, agency
or instrumentality, domestic or foreign, or any arbitrator, applicable to such Member or any of its Affiliates, (ii) does or will
conflict with, violate, result in a breach of or constitute a default under (or has conflicted with, violated, resulted in a breach
of or constituted a default under) any of the terms, conditions or provisions of the articles of incorporation, bylaws, partnership
agreement or operating agreement of such Member or any of its Affiliates or of any material agreement or instrument to which such
Member or any of its Affiliates is a party or by which such Member or any of its Affiliates is or may be bound or to which any
of its properties or assets is subject, (iii) does or will conflict with, violate, result in (or has conflicted with, violated
or resulted in) a breach of, constitute (or has constituted) a default under (whether with notice or lapse of time or both), accelerate
or permit the acceleration of (or has accelerated) the performance required by, give (or has given) to others any material interests
or rights or require any consent, authorization or approval under any indenture, mortgage, lease, agreement or instrument to which
such Member or any of its Affiliates is a party or by which such Member or any of its Affiliates or any of their properties or
assets is or may be bound or (iv) does or will result (or has resulted) in the creation or imposition of any lien upon any of the
properties or assets of such Member or any of its Affiliates.

 

    	 	 -33-	 

     

    

 

(c)         Governmental
Authorizations. Any registration, declaration or filing with, or consent, approval, license, permit or other authorization
or order by, or exemption or other action of, any governmental, administrative or regulatory authority, domestic or foreign, that
was or is required in connection with the valid execution, delivery, acceptance and performance by such Member under this Agreement
or consummation by such Member (or any of its Affiliates) of any transaction contemplated hereby has been completed, made or obtained
on or before the date hereof.

 

(d)         Litigation.
There are no actions, suits, proceedings or investigations pending, or, to the knowledge of such Member or any of its Affiliates,
threatened against or affecting such Member or any of its Affiliates or any of their properties, assets or businesses in any court
or before or by any governmental department, board, agency or instrumentality, domestic or foreign, or any arbitrator which could,
if adversely determined (or, in the case of an investigation could lead to any action, suit or proceeding which if adversely determined
could) reasonably be expected to materially impair such Member’s ability to perform its obligations under this Agreement
or to have a material adverse effect on the consolidated financial condition of such Member; such Member or any of its Affiliates
has not received any currently effective notice of any default, and such Member or any of its Affiliates is not in default, under
any applicable order, writ, injunction, decree, permit, determination or award of any court, any governmental department, board,
agency or instrumentality, domestic or foreign, or any arbitrator which could reasonably be expected to materially impair such
Member’s (or any of its Affiliate’s) ability to perform its obligations under this Agreement or to have a material
adverse effect on the consolidated financial condition of such Member.

 

(e)         Investigation.
Such Member is acquiring its Interest based upon its own investigation, and the exercise by such Member of its rights and the performance
of its obligations under this Agreement will be based upon its own investigation, analysis and expertise. Such Member is a sophisticated
investor possessing an expertise in analyzing the benefits and risks associated with acquiring investments that are similar to
the acquisition of its Interest.

 

(f)         Broker.
No broker, agent or other person acting as such on behalf of such Member was instrumental in consummating this transaction and
that no conversations or prior negotiations were had by such party with any broker, agent or other such person concerning the transaction
that is the subject of this Agreement.

 

(g)         Investment
Company Act. Neither such Member nor any of its Affiliates is, nor will the Company as a result of such Member holding an interest
therein be, an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940,
as amended.

 

    	 	 -34-	 

     

    

 

(h)         Securities
Matters.

 

(1)         None
of the Interests are registered under the Securities Act or any state securities laws. Such Member understands that the offering,
issuance and sale of the Interests are intended to be exempt from registration under the Securities Act, based, in part, upon the
representations, warranties and agreements contained in this Agreement. Such Member is an “accredited investor” as
such term is defined in Rule 501 of Regulation D promulgated under the Securities Act.

 

(2)         Neither
the Securities and Exchange Commission nor any state securities commission has approved the Interests or passed upon or endorsed
the merits of the offer or sale of the Interests. Such Member is acquiring the Interests solely for such Member’s own account
for investment and not with a view to resale or distribution thereof in violation of the Securities Act.

 

(3)         Such
Member is unaware of, and in no way relying on, any form of general solicitation or general advertising in connection with the
offer and sale of the Interests, and no Member has taken any action which could give rise to any claim by any person for brokerage
commissions, finders’ fees (without regard to any finders’ fees payable by the Company directly) or the like relating
to the transactions contemplated hereby.

 

(4)         Such
Member is not relying on the Company or any of its officers, directors, employees, advisors or representatives with regard to the
tax and other economic considerations of an investment in the Interests, and such Member has relied on the advice of only such
Member’s advisors.

 

(5)         Such
Member understands that the Interests may not be sold, hypothecated or otherwise disposed of unless subsequently registered under
the Securities Act and applicable state securities laws, or an exemption from registration is available. Such Member agrees that
it will not attempt to sell, transfer, assign, pledge or otherwise dispose of all or any portion of the Interests in violation
of this Agreement.

 

(6)         Such
Member has adequate means for providing for its current financial needs and anticipated future needs and possible contingencies
and emergencies and has no need for liquidity in the investment in the Interests.

 

(7)         Such
Member has significant prior investment experience, including investment in non-listed and non-registered securities. Such Member
is knowledgeable about investment considerations and has a sufficient net worth to sustain a loss of such Member’s entire
investment in the Company in the event such a loss should occur. Such Member’s overall commitment to investments which are
not readily marketable is not excessive in view of such Member’s net worth and financial circumstances and the purchase of
the Interests will not cause such commitment to become excessive. The investment in the Interests is suitable for such Member.

 

    	 	 -35-	 

     

    

 

(8)         Such
Member represents to the Company that the information contained in this subparagraph (h) and in all other writings, if any, furnished
to the Company with regard to such Member (to the extent such writings relate to its exemption from registration under the Securities
Act) is complete and accurate and may be relied upon by the Company in determining the availability of an exemption from registration
under federal and state securities laws in connection with the sale of the Interests.

 

		Section 12.	Sale, Assignment, Transfer or other Disposition.

 

12.1       Prohibited
Transfers. Except as otherwise provided in this Section 12, Sections 5.2(b), 15.1 and 15.2, or
as approved by the Management Committee, no Member shall Transfer all or any part of its Interest, whether legal or beneficial,
in the Company, and any attempt to so Transfer such Interest (and such Transfer) shall be null and void and of no effect. Notwithstanding
the foregoing, either Member shall have the right, with the consent of the other Member, at any time to pledge to a lender or creditor,
directly or indirectly, all or any part of its Interest in the Company for such purposes as it deems necessary in the ordinary
course of its business and operations.

 

12.2       Affiliate
Transfers.

 

(a)         Subject
to the provisions of Section 12.2(b) hereof, and subject in each case to the prior written approval of each Member (such
approval not to be unreasonably withheld), any Member may Transfer all or any portion of its Interest in the Company at any time
to an Affiliate of such Member, provided that such Affiliate shall remain an Affiliate of such Member at all times that such Affiliate
holds such Interest. If such Affiliate shall thereafter cease being an Affiliate of such Member while such Affiliate holds such
Interest, such cessation shall be a non-permitted Transfer and shall be deemed void ab initio, whereupon the Member having
made the Transfer shall, at its own and sole expense, cause such putative transferee to disgorge all economic benefits and otherwise
indemnify the Company and the other Member(s) against loss or damage under any Collateral Agreement.

 

(b)         Notwithstanding
anything to the contrary contained in this Agreement, the following Transfers shall not require the approval set forth in Section
12.2(a):

 

(1)         Any
Transfer by Carroll of up to one hundred percent (100%) of its Interest to any Affiliate of Carroll Parent (a “Carroll
Transferee”), it being expressly understood and agreed that transfers of ownership interests in Carroll shall not be
prohibited as long as at least one of the Key Individuals (collectively or individually) remains actively involved in the operation
and management of Carroll (to the extent that it continues to hold, or control, any interest in the Company), Carroll Parent and
any Carroll Transferee; and

 

(2)         Any
Transfer by Bluerock or a Bluerock Transferee of up to one hundred percent (100%) of its Interest to any Affiliate of Bluerock,
including but not limited to (A) BR Growth or any Person that is directly or indirectly owned by BR Growth; (B) BR SOIF II or any
Person that is directly or indirectly owned by BR SOIF II; (C) BR SOIF III or any Person that is directly or indirectly owned by
BR SOIF III; (D) BR REIT or any Person that is directly or indirectly owned by BR REIT; or (E) BR Growth II, or any Person that
is directly or indirectly owned by BR Growth II (collectively, a “Bluerock Transferee”);

 

    	 	 -36-	 

     

    

 

provided however, as to subparagraphs (b)(1)
and (b)(2), and as to subparagraph (a), no Transfer shall be permitted and shall be void ab initio if it shall violate any
“Transfer” provision of the Loan Documents or any applicable Collateral Agreement with third party lenders.

 

(c)         Upon
the execution by any such Carroll Transferee or Bluerock Transferee of such documents necessary to admit such party into the Company
and to cause the Carroll Transferee or Bluerock Transferee (as applicable) to become bound by this Agreement, the Carroll Transferee
or Bluerock Transferee (as applicable) shall become a Member, without any further action or authorization by any Member.

 

(d)         The
Transfer of any interest in Manager and any transferee of an interest in Manager shall be recognized and permitted under this Agreement
and by the Members, without any further action or authorization by any Member.

 

12.3       Admission
of Transferee; Partial Transfers. Notwithstanding anything in this Section 12 to the contrary and except as provided
in Section 5.2(b), no Transfer of Interests in the Company shall be permitted unless the potential transferee is admitted
as a Member under this Section 12.3:

 

(a)         If
a Member Transfers all or any portion of its Interest in the Company, such transferee may become a Member if (i) such transferee
executes and agrees to be bound by this Agreement, (ii) the transferor and/or transferee pays all reasonable legal and other fees
and expenses incurred by the Company in connection with such assignment and substitution and (iii) the transferor and transferee
execute such documents and deliver such certificates to the Company and the remaining Members as may be required by applicable
law or otherwise advisable; and

 

(b)         Notwithstanding
the foregoing, any Transfer or purported Transfer of any Interest, whether to another Member or to a third party, shall be of no
effect and void ab initio, and such transferee shall not become a Member or an owner of the purportedly transferred Interest,
if the Management Committee determines in its sole discretion that:

 

(1)         the
Transfer would require registration of any Interest under, or result in a violation of, any federal or state securities laws;

 

(2)         the
Transfer would result in a termination of the Company under Code Section 708(b); provided, however, that any such determination
under this Section 12.3(b)(2) shall require the reasonable determination and approval of at least one (1) Representative
appointed by Carroll.

 

(3)         as
a result of such Transfer the Company would be required to register as an investment company under the Investment Company Act of
1940, as amended, or any rules or regulations promulgated thereunder;

 

    	 	 -37-	 

     

    

 

(4)         if
as a result of such Transfer the aggregate value of Interests held by “benefit plan investors” including at least one
benefit plan investor that is subject to ERISA, could be “significant” (as such terms are defined in U.S. Department
of Labor Regulation 29 C.F.R. 2510.3-101(f)(2)) with the result that the assets of the Company could be deemed to be “plan
assets” for purposes of ERISA;

 

(5)         as
a result of such Transfer, the Company would or may have in the aggregate more than one hundred (100) members and material adverse
federal income tax consequences would result to a Member. For purposes of determining the number of members under this Section
12.3(b)(5), a Person (the “beneficial owner”) indirectly owning an interest in the Company through a partnership,
grantor trust or S corporation (as such terms are used in the Code) (the “flow-through entity”) shall be
considered a member, but only if (i) substantially all of the value of the beneficial owner’s interest in the flow-through
entity is attributable to the flow-through entity’s interest (direct or indirect) in the Company and (ii) in the sole discretion
of the Management Committee, a principal purpose of the use of the flow-through entity is to permit the Company to satisfy the
100-member limitation; or

 

(6)         the
transferor failed to comply with the provisions of Sections 12.2(a) or (b).

 

The Management Committee
may require the provision of a certificate as to the legal nature and composition of a proposed transferee of an Interest of a
Member and from any Member as to its legal nature and composition and shall be entitled to rely on any such certificate in making
such determinations under this Section 12.3.

 

12.4       Withdrawals.
Each of the Members does hereby covenant and agree that it will not withdraw, resign, retire or disassociate from the Company,
except as a result of a Transfer of its entire Interest in the Company permitted under the terms of this Agreement and that it
will carry out its duties and responsibilities hereunder until the Company is terminated, liquidated and dissolved under Section
13. No Member shall be entitled to receive any distribution or otherwise receive the fair market value of its Interest in compensation
for any purported resignation or withdrawal not in accordance with the terms of this Agreement.

 

		Section 13.	Dissolution.

 

13.1       Limitations.
The Company may be dissolved, liquidated and terminated only pursuant to the provisions of this Section 13, and, to the
fullest extent permitted by law but subject to the terms of this Agreement, the parties hereto do hereby irrevocably waive any
and all other rights they may have to cause a dissolution of the Company or a sale or partition of any or all of the Company’s
assets.

 

13.2       Exclusive
Events Requiring Dissolution. The Company shall be dissolved only upon the earliest to occur of the following events (a “Dissolution
Event”):

 

(a)         the
expiration of the specific term set forth in Section 2.5;

 

(b)         at
any time at the election of all of the Members in writing;

 

    	 	 -38-	 

     

    

 

(c)         at
any time there are no Members (unless otherwise continued in accordance with the Act);

 

(d)         the
entry of a decree of judicial dissolution pursuant to Section 18-802 of the Act; or

 

(e)         the
Purchase Agreement has not been closed by November 18, 2016.

 

13.3       Liquidation.
Upon the occurrence of a Dissolution Event, the business of the Company shall be continued to the extent necessary to allow an
orderly winding up of its affairs, including the liquidation of the assets of the Company pursuant to the provisions of this Section
13.3, as promptly as practicable thereafter, and each of the following shall be accomplished:

 

(a)         The
Management Committee shall cause to be prepared a statement setting forth the assets and liabilities of the Company as of the date
of dissolution, a copy of which statement shall be furnished to all of the Members.

 

(b)         The
property and assets of the Company shall be liquidated or distributed in kind under the supervision of the Management Committee
as promptly as possible, but in an orderly, businesslike and commercially reasonable manner.

 

(c)         Any
gain or loss realized by the Company upon the sale of its property shall be deemed recognized and allocated to the Members in the
manner set forth in Section 7.2. To the extent that an asset is to be distributed in kind, such asset shall be deemed to
have been sold at its fair market value on the date of distribution, the gain or loss deemed realized upon such deemed sale shall
be allocated in accordance with Section 7.2 and the amount of the distribution shall be considered to be such fair market
value of the asset.

 

(d)         The
proceeds of sale and all other assets of the Company shall be applied and distributed as follows and in the following order of
priority:

 

(1)         to
the satisfaction of the debts and liabilities of the Company (contingent or otherwise) and the expenses of liquidation or distribution
(whether by payment or reasonable provision for payment), other than liabilities to Members or former Members for Distributions;

 

(2)         to
the satisfaction of loans made pursuant to Section 5.2(b) in proportion to the outstanding balances of such loans at the
time of payment;

 

(3)         the
balance, if any, to the Members in accordance with Section 6.1.

 

13.4       Continuation
of the Company. Notwithstanding anything to the contrary contained herein, the death, retirement, resignation, expulsion, bankruptcy,
dissolution or removal of a Member shall not in and of itself cause the dissolution of the Company, and the Members are expressly
authorized to continue the business of the Company in such event, without any further action on the part of the Members.

 

    	 	 -39-	 

     

    

 

		Section 14.	Indemnification.

 

14.1       Exculpation
of Members. No Member, Manager, Representative or officer of the Company shall be liable to the Company or to the other Members
for damages or otherwise with respect to any actions or failures to act taken or not taken relating to the Company, except to the
extent any related loss results from fraud, gross negligence or willful or wanton misconduct on the part of such Member, Manager,
Representative or officer or the willful breach of any obligation under this Agreement.

 

14.2       Indemnification
by Company. The Company hereby indemnifies, holds harmless and defends the Members, the Manager, the Representatives, the officers
and each of their respective agents, officers, directors, members, managers, partners, shareholders and employees from and against
any loss, expense, damage or injury suffered or sustained by them (including but not limited to any judgment, award, settlement,
reasonable attorneys’ fees and other costs or expenses incurred in connection with the defense of any actual or threatened
action, proceeding or claim) by reason of or arising out of (i) their activities on behalf of the Company or in furtherance of
the interests of the Company, including, without limitation, the provision of guaranties to third party lenders in respect of financings
relating to the Company or any of its assets (but specifically excluding from such indemnity by the Company any so called “bad
boy” guaranties or similar agreements which provide for recourse as a result of failure to comply with covenants, willful
misconduct or gross negligence), (ii) their status as Members, Managers, Representatives, employees or officers of the Company,
or (iii) the Company’s assets, property, business or affairs (including, without limitation, the actions of any officer,
director, member, manager or employee of the Company or any of its Subsidiaries), if the acts or omissions were not performed or
omitted fraudulently or as a result of gross negligence or willful or wanton misconduct by the indemnified party or as a result
of the willful breach of any obligation under this Agreement by the indemnified party. For the purposes of this Section 14.2,
officers, directors, members, managers, employees and other representatives of Affiliates of a Member who are functioning as representatives
of such Member in connection with this Agreement shall be considered representatives of such Member for the purposes of this Section
14. Reasonable expenses incurred by the indemnified party in connection with any such proceeding relating to the foregoing
matters shall be paid or reimbursed by the Company in advance of the final disposition of such proceeding upon receipt by the Company
of (x) written affirmation by the Person requesting indemnification of its good faith belief that it has met the standard of conduct
necessary for indemnification by the Company and (y) a written undertaking by or on behalf of such Person to repay such amount
if it shall ultimately be determined by a court of competent jurisdiction that such Person has not met such standard of conduct,
which undertaking shall be an unlimited general obligation of the indemnified party but need not be secured.

 

14.3       Indemnification
by Members for Misconduct.

 

(a)         Carroll
hereby indemnifies, defends and holds harmless the Company, Bluerock, each Bluerock Transferee and each of their subsidiaries and
their agents, officers, directors, members, managers, partners, shareholders and employees from and against all losses, costs,
expenses, damages, claims and liabilities (including reasonable attorneys’ fees) as a result of or arising out of any fraud,
gross negligence or willful or wanton misconduct on the part of, or by, Carroll, the Key Individual, any entity controlled directly
or indirectly by the Key Individual that directly or indirectly controls Carroll, or any Representative appointed by Carroll.

 

    	 	 -40-	 

     

    

 

(b)         Bluerock
hereby indemnifies, defends and holds harmless the Company, Carroll, each Carroll Transferee and each of their subsidiaries and
their agents, officers, directors, members, managers, partners, shareholders and employees from and against all losses, costs,
expenses, damages, claims and liabilities (including reasonable attorneys’ fees) as a result of or arising out of any fraud,
gross negligence or willful or wanton misconduct on the part of, or by, Bluerock or any entity controlled directly or indirectly
by Bluerock, or any Representative appointed by Bluerock.

 

14.4       General
Indemnification by the Members.

 

(a)         Notwithstanding
any other provision contained herein, each Member (the “Indemnifying Party”) hereby indemnifies and holds harmless
the other Members, the Company and each of their subsidiaries and their agents, officers, directors, members, managers, partners,
shareholders and employees (each, an “Indemnified Party”) from and against all losses, costs, expenses, damages,
claims and liabilities (including reasonable attorneys’ fees) as a result of or arising out of (i) any breach of any obligation
of the Indemnifying Party under this Agreement, or (ii) any breach of any obligation by or any inaccuracy in or breach of any representation
or warranty made by the Indemnifying Party or its Affiliates, whether in this Agreement or in any other agreement with respect
to the conveyance, assignment, contribution or other transfer of the Property (or interests therein), assets, agreements, rights
or other interests conveyed, assigned, contributed or otherwise transferred to the Company (collectively, the “Inducement
Agreements”).

 

(b)         Except
as otherwise provided herein or in any other agreement, recourse for the indemnity obligation of the Members under this Section
14.4 shall be limited to such Indemnifying Party’s Interest in the Company; provided, however, that recourse against
either Member under its indemnity obligations under this Agreement or otherwise shall be further limited to an aggregate amount
equal to the value of such Member’s Interest as determined by and being limited to the then current liquidation value of
such Member’s Interest assuming the Company were liquidated in an orderly fashion and all net proceeds thereof were distributed
in accordance with Section 6.

 

(c)         The
indemnities, contributions and other obligations under this Agreement shall be in addition to any rights that any Indemnified Party
may have at law, in equity or otherwise. The terms of this Section 14 shall survive termination of this Agreement.

 

		Section 15.	Sale Rights.

 

15.1       Push
/ Pull Rights.

 

(a)         Availability
of Rights. If, at any time following the second anniversary of the date that the Property is initially acquired, the Members
are unable to agree on a Major Decision and such failure to agree has continued for fifteen (15) days after written notice from
one Member to the other Member indicating an intention to exercise rights under this Section 15.1, either Member may exercise
its right to initiate the provisions of this Section 15.1.

 

    	 	 -41-	 

     

    

 

(b)         Exercise.
The Member wishing to exercise its rights pursuant to this Section 15.1 (the “Offeror”) shall do so by
giving notice to the other Member (the “Offeree”) setting forth a statement of intent to invoke its rights under
this Section 15.1, stating therein the aggregate dollar amount (the “Valuation Amount”) that the Offeror
would be willing to pay for the assets of the Company as of the Closing Date (as defined below) free and clear of all liabilities,
and setting forth all oral or written offers and inquiries received by the Offeror during the previous twelve-month period relating
to the financing, disposition or leasing of any Company property (including proposals for the formation of one or more new entities
for the ownership and operation of the Property).

 

(c)         Offeree
Response. After receipt of such notice, the Offeree shall elect to either (i) sell its entire Interest to the Offeror for an
amount equal to the amount the Offeree would have been entitled to receive if the Company had sold its assets for the Valuation
Amount on the Closing Date and the Company had immediately paid all Company liabilities and Imputed Closing Costs and distributed
the net proceeds of sale to the Members in satisfaction of their Interests pursuant to Section 13.3, or (ii) purchase the
entire Interest of the Offeror for an amount equal to the amount the Offeror would have been entitled to receive if the Company
had sold all of its assets for the Valuation Amount on the Closing Date and the Company had immediately paid all Company liabilities
and Imputed Closing Costs and distributed the net proceeds of the sale to the Members in satisfaction of their Interests pursuant
to Section 13.3. The Offeree shall have thirty (30) days from the giving of the Offeror’s notice in which to exercise
either of its options by giving written notice to the Offeror. If the Offeree does not elect to acquire the Offeror’s Interest
within such time period, the Offeree shall be deemed to have elected to sell its Interest to the Offeror as provided in subsection
(i) above.

 

(d)         Earnest
Money. Within five (5) business days after an election has been made or deemed made under Section 15.1(c), the acquiring
Member shall deposit with a mutually acceptable third-party escrow agent a non-refundable earnest money deposit in the amount of
two percent (2%) of the amount the selling Member is entitled to receive for its Interest under this Section 15.1, which
amount shall be applied to the purchase price at closing. If the acquiring Member should thereafter fail to consummate the transaction
for any reason other than a default by the selling Member or a refusal by any lender of the Company (or any Subsidiary of the Company)
who has a right under its loan documents to consent to such transfer to so consent, (i) (A) the earnest money deposit shall be
distributed from escrow to the selling Member, free of all claims of the acquiring Member, as liquidated damages and constituting
the sole and exclusive remedy available to the selling Member because of a default by the acquiring Member or (B) the selling Member
may, by delivering to the acquiring Member written notice thereof, elect to buy the acquiring Member’s entire Interest for
an amount equal to the amount the acquiring Member would have been entitled to receive if the Company had sold all of its assets
for the Valuation Amount and the Company had immediately paid all Company liabilities and Imputed Closing Costs and distributed
the net proceeds of the sale to the Members in satisfaction of their Interests pursuant to Section 13.3, in which case,
the Closing Date therefor shall be the date specified in the selling Member’s notice, and (ii) if the acquiring Member was
the Offeror, the non-refundable earnest money deposit for any future election by the acquiring Member to buy the selling Member’s
Interest shall be twenty percent (20%) of the amount the selling Member is entitled to receive for its Interest in connection with
such future election.

 

    	 	 -42-	 

     

    

 

(e)         Closing.
The closing of an acquisition pursuant to this Section 15.1 shall be held on a mutually acceptable date (the “Closing
Date”) not later than sixty (60) days (or, if the Offeree is the acquiring Member, ninety (90) days) after an election
has been made or deemed made under Section 15.1(c). At such closing, the following shall occur:

 

(1)         The
selling Member shall assign to the acquiring Member or its designee the selling Member’s Interest in accordance with the
instructions of the acquiring Member, and shall execute and deliver to the acquiring Member all documents which may be required
to give effect to the disposition and acquisition of such interests, in each case free and clear of all liens, claims, and encumbrances,
with covenants of general warranty; and

 

(2)         The
acquiring Member shall pay to the selling Member the consideration therefor in cash.

 

(f)         Enforcement.
It is expressly agreed that the remedy at law for breach of the obligations of the Members set forth in this Section 15.1
is inadequate in view of (i) the complexities and uncertainties in measuring the actual damage to be sustained by reason of the
failure of a Member to comply fully with such obligations, and (ii) the uniqueness of the Company’s business and the Members’
relationships. Accordingly, each of such obligations shall be, and is hereby expressly made, enforceable by an order of specific
performance.

 

15.2       Forced
Sale Rights.

 

(a)         Offers.
If, at any time following the second anniversary of the date that the Property is initially acquired, either Member (i) desires
to offer the Property for sale on specified terms, or (ii) receives from an unaffiliated purchaser a bona fide written
cash offer (i.e., not seller financed) for the purchase of the Property at a price in excess of the then-pending balance due under
the Loan and otherwise on terms that such Member desires for the Company, or any Subsidiary that owns the Property (individually
or collectively, the “Ownership Entity”), to accept (such specified terms or bona fide offer being
herein called an “Offer”), then the Member desiring to make or accept the Offer (the “Initiating Member”)
shall provide written notice of the terms of such Offer (each, a “Sale Notice”) to the other Member (the “Non-Initiating
Member”).

 

(b)         Response.
The Non-Initiating Member shall have thirty (30) days from the date of the applicable Sale Notice (the “Response Period”)
to provide written notice to the Initiating Member of whether the applicable Ownership Entity should make or accept the applicable
Offer; the failure to timely deliver such notice shall be deemed to constitute an election to accept the applicable Offer and sell
such Property on the terms of the applicable Offer.

 

(c)         Offer
Unacceptable.

 

(1)         If
the Non-Initiating Member does not wish for the Company, or the applicable Ownership Entity, to make or accept the applicable Offer,
the Initiating Member may elect to sell its Interest to the Non-Initiating Member, in which case the Non-Initiating Member must
purchase the Initiating Member’s Interest in the Property for an amount equal to the amount that would be distributable to
the Initiating Member if the Company had accepted the applicable Offer, closed the sale pursuant to such Offer and, if applicable,
wound up its affairs pursuant to Section 13.

 

    	 	 -43-	 

     

    

 

(2)         For
purposes of the foregoing calculations, the purchase price for a sale shall be reduced by Imputed Closing Costs therefor. The Initiating
Member must exercise this option, if at all, by delivering written notice thereof to the Non-Initiating Member within twenty (20)
days after the end of the applicable Response Period. The Non-Initiating Member shall pay the Company cash for each Ownership Entity
or the Initiating Member cash for its Interest, as the case may be. Closing shall take place on or before the date specified in
the applicable Sale Notice, but if the Non-Initiating Member is purchasing the Initiating Member’s Interest or one or more
Ownership Entities, the Non-Initiating Member shall have until 120 days after the Sale Notice in which to close. If the Initiating
Member or the Non-Initiating Member defaults at closing, the non-defaulting party shall have the right to bring suit for damages,
for specific performance, or exercise any other remedy available at law or in equity. Upon payment at closing, the Initiating Member
shall execute and deliver all documents reasonably required to transfer the interest being sold.

 

(d)         Offer
Acceptable. If the Non-Initiating Member consents (or is deemed to have consented) to the Company or the applicable Ownership
Entity selling the Property on the terms of an Offer, then the Initiating Member shall be allowed to sell the Property for cash
on the terms of the applicable Offer for a period of up to one hundred eighty (180) days following the expiration of the applicable
Response Period. If the Initiating Member obtains a bona fide third party contract to sell all the Property on the
terms of the applicable Offer within such one hundred eighty (180) day period, the Initiating Member shall have an additional period
of ninety (90) days after the date of such contract (that is, not to exceed 270 days after the expiration of the applicable Response
Period) in which to consummate the sale. If after having received the consent (or deemed consent) of the Non-Initiating Member
to the sale of the Property on the terms of the applicable Offer, the Initiating Member is unable to obtain a bona fide
contract within such one hundred eighty (180) day period, or if after having obtained such bona fide contract, the
Initiating Member is unable to consummate such sale within 270 days after the expiration of the applicable Response Period, then
the Initiating Member must again submit an Offer to the Non-Initiating Member under the terms of this Section 15.2 before
it may sell the Property.

 

		Section 16.	Miscellaneous.

 

16.1       Notices.

 

(a)         All
notices, requests, approvals, authorizations, consents and other communications required or permitted under this Agreement shall
be in writing and shall be (as elected by the Person giving such notice) hand delivered by messenger or overnight courier service,
mailed (airmail, if international) by registered or certified mail (postage prepaid), return receipt requested, or sent via facsimile
(provided such facsimile is immediately followed by the delivery of an original copy of same via one of the other foregoing delivery
methods) addressed to:

 

    	 	 -44-	 

     

    

 

If to Bluerock:

 

c/o Bluerock Real Estate, L.L.C.

712 Fifth Avenue, 9th Floor

New York, New York 10019

Attention: James G. Babb, III

Facsimile No. (646) 278-4220

 

with copies to:

 

c/o Bluerock Real Estate, L.L.C.

712 Fifth Avenue, 9th Floor

New York, New York 10022

Attention: Michael Konig, Esq.

Facsimile No. (646) 278-4220

 

and

 

Kaplan, Voekler, Cunningham & Frank, PLC

1401 East Cary Street

Richmond, VA 23223

Attention: S. Edward Flanagan, Esq.

Facsimile No. (804) 823-4099

 

If to Carroll:

 

c/o Carroll Organization, LLC

3340 Peachtree Road, Suite 1620

Atlanta, Georgia 30326

Attention: M. Patrick Carroll

Facsimile No. (404) 523-9372

 

With a copy to:         

 

Morris, Manning & Martin LLP

1600 Atlanta Financial Center

3343 Peachtree Road, NE

Atlanta, Georgia 30326

Attention: Corey B. May, Esq.

Facsimile: (404) 365-9532

 

(b)         Each
such notice shall be deemed delivered (i) on the date delivered if by hand delivery or overnight courier service or facsimile,
and (ii) on the date upon which the return receipt is signed or delivery is refused or the notice is designated by the postal authorities
as not deliverable, as the case may be, if mailed (provided, however, if such actual delivery occurs after 5:00 p.m. (local time
where received), then such notice or demand shall be deemed delivered on the immediately following business day after the actual
day of delivery).

 

    	 	 -45-	 

     

    

 

(c)         By
giving to the other parties at least fifteen (15) days written notice thereof, the parties hereto and their respective successors
and assigns shall have the right from time to time and at any time during the term of this Agreement to change their respective
addresses.

 

16.2       Governing
Law; Forum. This Agreement and the rights of the Members hereunder shall be governed by, and interpreted in accordance with,
the laws of the State of Delaware, without regard to its conflicts of law provisions. Any legal action or other legal proceeding
relating to this Agreement or the enforcement of any provision of this Agreement shall only be brought or otherwise commenced in
any state or federal court located in the State of New York. Each of the parties hereto:

 

(a)         Expressly
and irrevocably consents and submits to the exclusive personal jurisdiction of and venue in each state and federal court located
in the State of New York (and each appellate court located in the State of New York), in connection with any such legal proceeding;

 

(b)         Agrees
that each state and federal court located in the State of New York shall be deemed to be a convenient forum; and

 

(c)         Agrees
not to assert (by way of motion, as a defense or otherwise), in any such legal proceeding commenced in any state or federal court
located in the State of New York, any claim that it is not subject personally to the jurisdiction of such court, that such legal
proceeding has been brought in an inconvenient forum, that the venue for such proceeding is improper or that this Agreement or
the subject matter of this Agreement may not be enforced in or by such court.

 

Each of the parties hereto
designates CT Corporation System, 1633 Broadway, New York, New York 10019, as its agent for service of process in the State of
New York, which designation may only be changed on not less than ten (10) days’ prior notice to all of the other parties.

 

16.3       Successors.
This Agreement shall be binding upon, and inure to the benefit of, the parties and their successors and permitted assigns. Except
as otherwise provided herein, any Member who Transfers its Interest as permitted by the terms of this Agreement shall have no further
liability or obligation hereunder, except with respect to claims arising prior to such Transfer.

 

16.4       Pronouns.
Whenever from the context it appears appropriate, each term stated in either the singular or the plural shall include the singular
and the plural, and pronouns stated in either the masculine, the feminine or the neuter gender shall include the masculine, feminine
and neuter.

 

16.5       Captions
Not Part of Agreement. The captions contained in this Agreement are inserted only as a matter of convenience and in no way
define, limit or extend the scope or intent of this Agreement or any provisions hereof.

 

16.6       Severability.
If any provision of this Agreement shall be held invalid, illegal or unenforceable in any jurisdiction or in any respect, then
the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired,
and the Members shall use their best efforts to amend or substitute such invalid, illegal or unenforceable provision with enforceable
and valid provisions which would produce as nearly as possible the rights and obligations previously intended by the Members without
renegotiation of any material terms and conditions stipulated herein.

 

    	 	 -46-	 

     

    

 

16.7       Counterparts.
This Agreement may be executed in several counterparts, each of which shall be deemed an original but all of which shall constitute
one and the same instrument.

 

16.8       Entire
Agreement and Amendment. This Agreement and the other written agreements described herein between the parties hereto entered
into as of the date hereof, constitute the entire agreement between the Members relating to the subject matter hereof. In the event
of any conflict between this Agreement and such other written agreements, the terms and provisions of this Agreement shall govern
and control. No amendment or waiver by a party shall be enforceable against that party unless it is in writing and duly executed
by such party.

 

16.9       Further
Assurances. Each Member agrees to execute and deliver any and all additional instruments and documents and do any and all acts
and things as may be necessary or expedient to effectuate more fully this Agreement or any provisions hereof or to carry on the
business contemplated hereunder.

 

16.10     No
Third Party Rights. The provisions of this Agreement are for the exclusive benefit of the Members and the Company, and no other
party (including, without limitation, any creditor of the Company) shall have any right or claim against any Member by reason of
those provisions or be entitled to enforce any of those provisions against any Member.

 

16.11     Incorporation
by Reference. Every Exhibit and Annex attached to this Agreement is incorporated in this Agreement by reference.

 

16.12     Limitation
on Liability. Except as set forth in Section 14 and with respect to a Default Loan as set forth in Section 5.2(b),
the Members shall not be bound by, or be personally liable for, by reason of being a Member, a judgment, decree or order of a court
or in any other manner, for the expenses, liabilities or obligations of the Company, and the liability of each Member shall be
limited solely to the amount of its Capital Contributions as provided under Section 5. Except as set forth in Section
14.3 and with respect to a Default Loan as set forth in Section 5.2(b), any claim against any Member (the “Member
in Question”) which may arise under this Agreement shall be made only against, and shall be limited to, such Member in
Question’s Interest, the proceeds of the sale by the Member in Question of such Interest or the undivided interest in the
assets of the Company distributed to the Member in Question pursuant to Section 13.3(d) hereof. Except as set forth in Section
14.3 and with respect to a Default Loan as set forth in Section 5.2(b), any right to proceed against (i) any other assets
of the Member in Question or (ii) any agent, officer, director, member, manager, partner, shareholder or employee of the Member
in Question or the assets of any such Person, as a result of such a claim against the Member in Question arising under this Agreement
or otherwise, is hereby irrevocably and unconditionally waived.

 

    	 	 -47-	 

     

    

 

16.13     Remedies
Cumulative. The rights and remedies given in this Agreement and by law to a Member shall be deemed cumulative, and the exercise
of one of such remedies shall not operate to bar the exercise of any other rights and remedies reserved to a Member under the provisions
of this Agreement or given to a Member by law. In the event of any dispute between the parties hereto, the prevailing party shall
be entitled to recover from the other party reasonable attorney’s fees and costs incurred in connection therewith.

 

16.14     No
Waiver. One or more waivers of the breach of any provision of this Agreement by any Member shall not be construed as a waiver
of a subsequent breach of the same or any other provision, nor shall any delay or omission by a Member to seek a remedy for any
breach of this Agreement or to exercise the rights accruing to a Member by reason of such breach be deemed a waiver by a Member
of its remedies and rights with respect to such breach.

 

16.15     Limitation
On Use of Names. Notwithstanding anything contained in this Agreement or otherwise to the contrary, each of Bluerock and Carroll
as to itself agree that neither it nor any of its Affiliates, agents, or representatives is granted a license to use or shall use
the name of the other under any circumstances whatsoever, except such name may be used in furtherance of the business of the Company
but only as and to the extent unanimously approved by the Members. Any change in the name of any portion of the Property must be
approved by the Management Committee.

 

16.16     Publicly
Traded Partnership Provision. Each Member hereby severally covenants and agrees with the other Members for the benefit of such
Members, that (a) it is not currently making a market in Interests in the Company and will not in the future make such a market
and (b) it will not Transfer its Interest on an established securities market, a secondary market or an over-the-counter market
or the substantial equivalent thereof within the meaning of Code Section 7704 and the Regulations, rulings and other pronouncements
of the U.S. Internal Revenue Service or the Department of the Treasury thereunder. Each Member further agrees that it will not
assign any Interest in the Company to any assignee unless such assignee agrees to be bound by this Section 16.16 and to
assign such Interest only to such Persons who agree to be similarly bound.

 

16.17     Uniform
Commercial Code. The interest of each Member in the Company shall be an “uncertificated security” governed by Article
8 of the Delaware UCC and the UCC as enacted in the State of New York (the “New York UCC”), including, without
limitation, (i) for purposes of the definition of a “security” thereunder, the interest of each Member in the Company
shall be a security governed by Article 8 of the Delaware UCC and the New York UCC and (ii) for purposes of the definition of an
“uncertificated security” thereunder.

 

16.18     Public
Announcements. Neither Carroll nor any of its Affiliates shall, without the prior approval of Bluerock, issue any press releases
or otherwise make any public statements with respect to the Company or the transactions contemplated by this Agreement, except
as may be required by applicable law or regulation or by obligations pursuant to any listing agreement with any national securities
exchange so long as Carroll or such Affiliate has used reasonable efforts to obtain the approval of Bluerock prior to issuing such
press release or making such public disclosure.

 

    	 	 -48-	 

     

    

 

16.19     No
Construction Against Drafter. This Agreement has been negotiated and prepared by Bluerock and Carroll and their respective
attorneys and, should any provision of this Agreement require judicial interpretation, the court interpreting or construing such
provision shall not apply the rule of construction that a document is to be construed more strictly against one party.

 

Section
17.          Insurance. During the Term, Property Manager, pursuant to the terms of the Management Agreement,
shall procure and maintain insurance as is determined to be appropriate by the Management Committee (in form and with endorsements,
waivers and deductibles and with insurance companies, designated or approved by Bluerock) naming the Company (and the Subsidiary
owning the Property), Bluerock and Carroll as insureds thereunder.

 

[SIGNATURES ON FOLLOWING PAGES]

 

    	 	 -49-	 

     

    

 

IN WITNESS WHEREOF, this
Agreement is executed by the Members, effective as of the date first set forth above.

 

	 	BR GLENRIDGE JV MEMBER, LLC, 
	 	a Delaware limited liability company

 

	 	By:	BRG Glenridge, LLC, a Delaware limited liability company, its manager

 

	 	By:	Bluerock Residential Holdings, L.P., a Delaware limited partnership, its sole member

 

	 	 	By:	Bluerock Residential Growth REIT, Inc., a Maryland corporation, its general partner

 

	 	 	By:	/s/ Michael Konig
	 	 	Name:	Michael Konig
	 	 	Title:	Authorized Signatory

 

    	 	 -50-	 

     

    

 

	 	CARROLL CO-INVEST IV GLENRIDGE, LLC, 
	 	a Georgia limited liability company 

 

	 	By:	Carrroll Multi-Family Real Estate Fund IV, LP,  a Delaware limited partnership, it manager

 

	 	By:	MPC Property Holdings IV, LLC,  a Georgia limited liability company, its general partner

 

	
         

         
	By:	MPC Partnership Holdings LLC, a Georgia limited liability company, its sole member

 

	 	By:	P. Carroll Capitol Partners, LLC, a Georgia limited liability company, its managing member

 

	 	By:	HUP Investment Company, LLC, a Georgia limited liability company, its sole member

 

	 	By:	/s/ M. Patrick Carroll
	 	Name:	M. Patrick Caroll
	 	Its:	Sole Member

 

	 	For purposes of Sections 6.1(c), 8.2(b), 9.3, 9.4, 9.7 and 17 only, and only for the term Carroll Management Group, LLC is Property Manager under the Management Agreement.
	 	 
	 	CARROLL MANAGEMENT GROUP, LLC

 

	 	By:	/s/ Josh Champion
	 	Name:	Josh Champion
	 	Title:	President

 

    	 	 -51-	 

     

    

EXHIBIT A

 

Initial Capital Contributions and Percentage
Interests

 

	Member Name	 	Capital Contributions	 	 	Percentage Interest	 
	 	 	 	 	 	 	 
	BR Glenridge JV Member, LLC	 	$	22,770,975.08	 	 	 	90	%
	 	 	 	 	 	 	 	 	 
	Carroll Co-Invest IV Glenridge, LLC	 	$	2,530,108.34	**	 	 	10	%

 

**Made up of $2,530,108.34 (including $341,250
in intangibles) allocable to the Property.

 

Management Committee Representatives

 

Bluerock:

 

James G. Babb, III

Jordan B. Ruddy

 

Carroll:

 

Patrick Carroll

Joshua Champion

    	 	 	 

     

    

 

EXHIBIT B

 

Annual Business Plan Information

 

		1.	a narrative description of any acquisitions or sales that are planned and any other activities
proposed to be undertaken;

 

		2.	a projected annual income statement (accrual basis) on a quarter-by-quarter basis;

 

		3.	a projected balance sheet as of the end of the next Fiscal Year;

 

		4.	a schedule of projected operating cash flow (including itemized operating revenues, project costs
and project expenses) for such Fiscal Year on a quarter-by-quarter basis, including a schedule of projected operating deficits,
if any;

 

		5.	a marketing plan indicating the portions of the Property that Property Manager recommends be made
available for sale or lease and the proposed terms and conditions relating thereto;

 

		6.	a detailed budget reflecting on a line by line basis all projected operating expenses and any proposed
construction and capital expenditures for the Property, including projected dates for commencement and completion of the foregoing;

 

		7.	a description of the proposed investment of any funds of the Company which are (or are expected
to become) available for investment;

 

		8.	a description, including the identity of the recipient (if known) and the amount and purpose, of
all fees and other payments proposed, expected or projected to be paid for professional services and, if a fee or payment exceeds
$25,000, for other services rendered to or on behalf of the Company by third parties;

 

		9.	a projection of the amount of any anticipated additional Capital Contributions which may be called
for pursuant to Section 5.2(a) and the purposes for which such additional Capital Contributions may be used; and

 

		10.	such other information requested from time to time by any Member.

 

    	 	 	 

     

    

 

EXHIBIT C

 

Management Agreement

 

    	 	 	 

     

    

 

Exhibit D

 

Initial Annual Business PlanExhibit 10.4

 

LIMITED LIABILITY COMPANY AGREEMENT OF

BR CARROLL GLENRIDGE, LLC

 

THIS LIMITED LIABILITY
COMPANY AGREEMENT of BR CARROLL GLENRIDGE, LLC, a Delaware limited liability company (the “Company”), as amended
from time to time, (the "Agreement") is entered into among BR Carroll Glenridge JV, LLC, a Delaware limited liability
company, the sole member of the Company (the "Member"), Michael L. Konig (“Springing Member 1”),
and Jordan B. Ruddy (“Springing Member 2” and together with Springing Member 1, the “Springing Members”).

 

RECITALS

 

A.           The
Company was formed as a Delaware limited liability company in accordance with the Delaware Limited Liability Company Act, as amended
from time to time (the "Act").

 

B.           The
undersigned desire to execute this Agreement to set forth the terms and conditions under which the management, business, and financial
affairs of the Company will be conducted.

 

C.           Definitions
for this Agreement are set forth in Article XI.

 

AGREEMENT

 

NOW, THEREFORE, in
consideration of the foregoing recitals and the mutual promises, covenants, and conditions herein contained, the receipt and sufficiency
of which are hereby acknowledged, the undersigned parties hereby covenant and agree as follows:

 

ARTICLE I

PURPOSE AND POWERS OF COMP ANY

 

1.1           Purpose.
The Company's business and purpose shall consist solely of the acquisition, ownership, operation, management, financing and disposition
of the multi-family real estate project consisting of approximately 480 units and located at 5501 Glenridge Drive, Atlanta, Georgia
and currently commonly known as Nevadan Apartments (and to be rebranded as Glenridge Apartments) (the "Mortgaged Property")
and such activities as are necessary, incidental or appropriate in connection therewith.

 

1.2           Powers.
The Company shall have all powers of a limited liability company formed under the Act and not prohibited by the Act or this Agreement;
provided, however, that during the term of that certain loan from the Lender in the approximate amount of $48,431,000.00 (the "Loan"),
the Company will comply with the applicable single purpose requirements of the Lender set forth in the Loan Documents and in Section
1.7 of this Agreement.

 

     

     

    

 

1.3           Title
to Company Property. All property owned by the Company shall be owned by the Company as an entity and, insofar as permitted
by applicable law, no Member shall have any ownership interest in any Company property in its individual name or right, and each
Member's Membership Interest shall be personal property for all purposes.

 

1.4           Term.
This Agreement shall not terminate until the Company is terminated in accordance with this Agreement.

 

1.5           Registered
Office and Registered Agent. The Company's initial registered office and initial registered agent shall be as provided in the
Certificate of Formation. The registered office and registered agent may be changed from time to time by filing the address of
the new registered office and/or the name of the new registered agent pursuant to the Act.

 

1.6           Formation
and Authorized Person. The Certificate of Formation has been filed with the Secretary of State of the State of Delaware in
accordance with and pursuant to the Act. Chris Vohs is hereby designated as an "authorized person" within the meaning
of the Act, and has executed, delivered and filed the Certificate of Formation of the Company with the Secretary of State of the
State of Delaware, and is hereby authorized to execute, deliver and file any other certificates (and any amendments and/or restatements
thereof) necessary or desirable for the Company to qualify to do business in any other jurisdiction in which the Company may wish
to conduct business (the "Qualification Papers"). The execution, delivery and filing of the Qualification Papers
by Chris Vohs as an "authorized person" within the meaning of the Act is hereby approved and ratified in all respects.
Upon the filing of all of Qualification Papers, his powers as an "authorized person" ceased, and the Member thereupon
became the designated "authorized person" and shall continue as the designated "authorized person" within the
meaning of the Act.

 

1.7           Limitation
on Certain Activities.

 

(a)          Until
the Loan is paid in full, the Company shall remain a Single Purpose Entity.

 

(b)          A
“Single Purpose Entity” means a limited liability company which, at all times since its formation and thereafter:

 

		(i)	shall not engage in any business or activity, other
than the ownership, operation and maintenance of the Mortgaged Property and activities incidental thereto;

 

		(ii)	shall not acquire, own, hold, lease, operate, manage,
maintain, develop or improve any assets other than the Mortgaged Property and such Personalty as may be necessary for the operation
of the Mortgaged Property and shall conduct and operate its business as presently conducted and operated;

 

		(iii)	shall preserve its existence as an entity duly organized,
validly existing and in good standing under the laws of Delaware and shall do all things necessary to observe organizational formalities;

 

		(iv)	shall not merge or consolidate with any other Person;

 

    	 	2	 

     

    

 

		(v)	shall not take any action to dissolve, wind-up, terminate
or liquidate in whole or in part; to sell, transfer or otherwise dispose of all or substantially all of its assets; to change
its legal structure; transfer or permit the direct or indirect transfer of any membership interests, other than Transfers permitted
under the Loan Agreement; issue additional membership interests; or seek to accomplish any of the foregoing;

 

		(vi)	shall not, without the prior unanimous written consent
of all of the Company’s members: (A) file any insolvency, or reorganization case or proceeding, to institute proceedings
to have the Company be adjudicated bankrupt or insolvent, (B) institute proceedings under any applicable insolvency law, (C) seek
any relief under any law relating to relief from debts or the protection of debtors, (D) consent to the filing or institution
of bankruptcy or insolvency proceedings against the Company, (E) file a petition seeking, or consent to, reorganization or relief
with respect to the Company under any applicable federal or state law relating to bankruptcy or insolvency, (F) seek or consent
to the appointment of a receiver, liquidator, assignee, trustee, sequestrator, custodian, or any similar official for the Company
or a substantial part of its property, (G) make any assignment for the benefit of creditors of the Company, (H) admit in writing
the Company’s inability to pay its debts generally as they become due, or (I) take action in furtherance of any of the foregoing;

 

		(vii)	shall not amend or restate its organizational documents
if such change would modify the requirements set forth in Section 6.13 of the Loan Agreement;

 

		(viii)	shall not own any subsidiary or make any investment
in any other Person;

 

		(ix)	shall not commingle its assets with the assets of
any other Person and shall hold all of its assets in its own name;

 

		(x)	shall not incur any debt, secured or unsecured, direct
or contingent (including, without limitation, guaranteeing any obligation), other than the following; provided, no Member of the
Company will be required to contribute any additional capital to satisfy this covenant, (A) the Loan (and any further indebtedness
as described in Section 11.11 of the Loan Agreement with regard to Supplemental Loans) and (B) customary unsecured trade payables
incurred in the ordinary course of owning and operating the Mortgaged Property provided the same are not evidenced by a promissory
note, do not exceed, in the aggregate, at any time a maximum amount of two percent (2%) of the original principal amount of the
Loan and are paid within sixty (60) days of the date incurred;

 

    	 	3	 

     

    

 

		(xi)	shall maintain its records, books of account, bank
accounts, financial statements, accounting records and other entity documents separate and apart from those of any other Person
and shall not list its assets as assets on the financial statement of any other Person; provided, however, that the Company’s
assets may be included in a consolidated financial statement of its Affiliate provided that (A) appropriate notation shall be
made on such consolidated financial statements to indicate the separateness of the Company from such Affiliate and to indicate
that the Company’s assets and credit are not available to satisfy the debts and other obligations of such Affiliate or any
other Person and (B) such assets shall also be listed on the Company’s own separate balance sheet;

 

		(xii)	except for capital contributions or capital distributions
permitted under the terms and conditions of its organizational documents, shall only enter into any contract or agreement with
any member or Affiliate of the Company upon terms and conditions that are commercially reasonable and substantially similar to
those that would be available on an arm’s-length basis with third parties;

 

		(xiii)	shall not maintain its assets in such a manner that
will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person;

 

		(xiv)	shall not assume or guaranty (excluding any guaranty
that has been executed and delivered in connection with the Loan) the debts or obligations of any other Person, hold itself out
to be responsible for the debts of another Person, pledge its assets to secure the obligations of any other Person or otherwise
pledge its assets for the benefit of any other Person, or hold out its credit as being available to satisfy the obligations of
any other Person;

 

		(xv)	shall not make or permit to remain outstanding any
loans or advances to any other Person except for those investments permitted under the documents evidencing and/or securing the
Loan and shall not buy or hold evidence of indebtedness issued by any other Person (other than cash or investment-grade securities);

 

		(xvi)	shall file its own tax returns separate from those
of any other Person, except to the extent that the Company is treated as a “disregarded entity” for tax purposes and
is not required to file tax returns under applicable law, and shall pay any taxes required to be paid under applicable law;

 

		(xvii)	shall hold itself out to the public as a legal entity
separate and distinct from any other Person and conduct its business solely in its own name, shall correct any known misunderstanding
regarding its separate identity and shall not identify itself or any of its Affiliates as a division or department of any other
Person;

 

    	 	4	 

     

    

 

		(xviii)	shall maintain adequate capital for the normal obligations
reasonably foreseeable in a business of its size and character and in light of its contemplated business operations and shall
pay its debts and liabilities from its own assets as the same shall become due, provided that no member of the Company will be
required to contribute any additional capital to satisfy this covenant;

 

		(xix)	shall allocate fairly and reasonably shared expenses
with Affiliates (including, without limitation, shared office space) and use separate stationery, invoices and checks bearing
its own name;

 

		(xx)	shall pay (or cause the Property Manager to pay on
behalf of the Company from the Company’s funds) its own liabilities (including, without limitation, salaries of its own
employees) from its own funds;

 

		(xxi)	shall not acquire obligations or securities of its
members or Affiliates;

 

		(xxii)	except as contemplated or permitted by the property
management agreement with respect to the Property Manager, shall not permit any Affiliate or constituent party independent access
to its bank accounts;

 

		(xxiii)	shall maintain a sufficient number of employees (if
any) in light of its contemplated business operations and pay the salaries of its own employees, if any, only from its own funds;

 

		(xxiv)	shall satisfy each of the following conditions:

 

		(A)	be formed and organized under Delaware law;

 

		(B)	have two springing members who are natural persons;

 

		(C)	otherwise comply with all Rating Agencies criteria for single member limited liability companies
(including the delivery of Delaware single member limited liability company opinions acceptable in all respects to lenders and
to the Rating Agencies); and

 

		(D)	at all times the Company will have one and only one
member.

 

The provisions of this
Section 1.7 shall govern and supersede any other provision of this Agreement to the contrary.

 

    	 	5	 

     

    

 

ARTICLE II

MEMBERS

 

		2.1	Initial Member.

 

(a)          The
name, address and initial Membership Interest of the initial Member is as follows:

 

	 	Name	 	Membership Interest
	 	BR Carroll Glenridge JV, LLC	 	100%
	 	c/o Bluerock Real Estate, L.L.C.	 	 
	 	712 Fifth Avenue, 9th Floor	 	 
	 	New York, NY 10019	 	 

 

(b)          The
Member was admitted to the Company as a member of the Company upon its execution of a counterpart signature page to this Agreement.

 

2.2           Special
Member.  Upon the occurrence of any event that causes the Member
to cease to be a member of the Company (other than (i) upon an assignment by the Member of all of its limited liability company
interest in the Company and the admission of the transferee, or (ii) the resignation of the Member and the admission of an additional
member of the Company, (a “Member Cessation Event”)), Springing Member 1 shall, without any action of any Person
and simultaneously with the Member Cessation Event, automatically be admitted to the Company as a Special Member and shall continue
the Company without dissolution. If, however, at the time of a Member Cessation Event, Springing Member 1 has died or is otherwise
no longer able to step into the role of Special Member, then in such event, Springing Member 2 shall, concurrently with the Member
Cessation Event, and without any action of any Person and simultaneously with the Member Cessation Event, automatically be admitted
to the Company as Special Member and shall continue the Company without dissolution. It is the intent of these provisions that
the Company never have more than one Special Member at any particular point in time. No Special Member may resign from the Company
or transfer its rights as Special Member unless a successor Special Member has been admitted to the Company as Special Member by
executing a counterpart to this Agreement. The Special Member shall automatically cease to be a member of the Company upon the
admission to the Company of a substitute member. The Special Member shall be a member of the Company that has no interest in the
profits, losses and capital of the Company and has no right to receive any distributions of Company assets. Pursuant to Section
18-301 of the Act, a Special Member shall not be required to make any capital contributions to the Company and shall not receive
a limited liability company interest in the Company. A Special Member, in its capacity as Special Member, may not bind the Company.
Except as required by any mandatory provision of the Act, a Special Member, in its capacity as Special Member, shall have no right
to vote on, approve or otherwise consent to any action by, or matter relating to, the Company, including, without limitation, the
merger, consolidation or conversion of the Company. In order to implement the admission to the Company of the Special Member, each
of Springing Member 1 and Springing Member 2 shall execute a counterpart to this Agreement. Prior to its admission to the Company
as Special Member, neither Michael L. Konig nor Jordan B. Ruddy shall be a member of the Company.

 

The Company shall at
all times have a Springing Member 1 and Springing Member 2. No resignation or removal of either Springing Member 1 or Springing
Member 2, and no appointment of a successor Springing Member, shall be effective unless and until such successor shall have executed
a counterpart to this Agreement. In the event of a vacancy in the position of Springing Member 1 or Springing Member 2, the Member
shall, as soon as practicable, appoint a successor Springing Member to fill such vacancy. By signing this Agreement, a springing
member agrees that, should such Springing Member become a Special Member, such springing member will be subject to and bound by
the provisions of this Agreement applicable to a Special Member.

 

    	 	6	 

     

    

 

ARTICLE III

MANAGEMENT BY MEMBER

 

3.1           In
General. The powers of the Company shall be exercised by, or under the authority of, the Member. In addition, the business
and affairs of the Company shall be ·managed under the direction of the Member. Subject to the limitations set forth in
this Agreement, the Member shall be entitled to make all decisions and take all actions for the Company.

 

3.2           Management
by Member. Except as otherwise limited by this Agreement, the Member shall have the power to do any and all acts necessary,
convenient or incidental to or for the furtherance of the purposes described herein, including all powers, statutory or otherwise;
provided, however, that the Company may, at its election, appoint one or more officers to exercise its rights under this Agreement.
The Member shall be entitled to make all decisions and take all actions for the Company, and the Member has the authority to bind
the Company.

 

3.3           Required
Approval. Any provision in this Agreement that requires the approval of the Members, but does not specify the particular percentage
interests or number of Members required for such approval, shall be interpreted to require the affirmative vote of the Member or
Members holding a majority of the total Membership Interests from time to time, and specifically shall not be interpreted to require
unanimous consent of the Members.

 

3.4           Action
By Member. In exercising the voting or other approval rights as provided herein, the Member may act through meetings and/or
written consents.

 

3.5           Authorization.
The Company is authorized to acquire the Mortgaged Property and to borrow the Loan from KeyBank National Association for and on
behalf of Freddie Mac, the assignee of the Loan (together with its successors and assigns, the "Lender"), and
from time to time refinance the Loan. In furtherance of the conduct of the purposes described herein, the Company shall possess
and may exercise all of the powers and privileges granted by the Act, and the Company is hereby authorized to do any act, enter
into any agreement, contract or other instrument, and otherwise to engage in any activity and to do any action not prohibited under
the Act or other applicable law which is necessary, useful, desirable or convenient to the conduct, promotion and attainment of
the business and purposes of the Company. In addition, the Company, or the Member on behalf of the Company, may enter into and
perform the Loan Documents and all documents, agreements, certificates, or financing statements contemplated thereby or related
thereto, all without any further act, vote or approval of any other Person notwithstanding any other provision of this Agreement,
the Act or applicable law, rule or regulation. The foregoing authorization shall not be deemed a restriction on the powers of the
Member to enter into other agreements on behalf of the Company in accordance with this Agreement.

 

ARTICLE IV

INTENTIONALLY OMITTED

 

    	 	7	 

     

    

 

ARTICLE V

SUBORDINATION OF INDEMNIFICATION PROVISIONS

 

5.1        Notwithstanding
any provision hereof to the contrary, any indemnification claim against the Company arising under the Certificate of Formation,
this Agreement or the laws of the state of organization of the Company shall be fully subordinate to any obligations of the Company
arising under the Mortgage or any other Loan Document, and shall only constitute a claim against the Company to the extent of,
and shall be paid by the Company in monthly installments only from, the excess of net operating income of the Company for any month
over all amounts then due under the Mortgage and the other Loan Documents.

 

ARTICLE VI

EFFECT OF BANKRUPTCY. DEATH OR INCOMPETENCY
OF A MEMBER

 

6.1        The
bankruptcy, death, dissolution, liquidation, termination or adjudication of incompetency of a Member shall not cause the termination
or dissolution of the Company and the business of the Company shall continue. Upon any such occurrence, the trustee, receiver,
executor, administrator, committee, guardian or conservator of such Member shall have all the rights of such Member for the purpose
of settling or managing its estate or property, subject to satisfying conditions precedent to the admission of such assignee as
a substitute member. The transfer by such trustee, receiver, executor, administrator, committee, guardian or conservator of any
Company Interest shall be subject to all of the restrictions hereunder to which such transfer would have been subject if such transfer
had been made by such bankrupt, deceased, dissolved, liquidated, terminated or incompetent Member. The foregoing shall apply to
the extent permitted by applicable law. Notwithstanding any other provision of the Certificate of Formation or this Agreement,
no Member or Special Member of the Company shall have any right under Section 18-801(b) of the Act to agree in writing to dissolve
the Company upon the bankruptcy of a Member or Special Member or the occurrence of any event that causes a Member or Special Member
of the Company to cease to be a member of the Company. The existence of the Company as a separate legal entity shall continue until
the cancellation of its Certificate of Formation as provided in the Act.

 

ARTICLE VII

CONTRIBUTIONS TO THE COMPANY AND DISTRIBUTIONS

 

7.1           Member
Capital Contributions. Upon execution of this Agreement, the Member shall contribute as the Member's initial Capital Contribution,
$100 in cash.

 

7.2           [Intentionally
Left Blank]

 

7.3           Distributions
and Allocations. All distributions of cash or other property (except upon the Company's dissolution, which shall be governed
by the applicable provisions of the Act and Article IX hereof) and all allocations of income, profits, and loss shall be made
100% to the Member in accordance with its Membership Interest. All amounts withheld pursuant to the Code or any provisions of
state or local tax law with respect to any payment or distribution to the Member from the Company shall be treated as amounts
distributed to the Member pursuant to this Section 7.3. Notwithstanding any provision to the contrary contained in this Agreement,
the Company shall not be required to make a distribution to the Member on account of its interest in the Company if such distribution
would violate Section 18-607 of the Act or any other applicable law.

 

    	 	8	 

     

    

 

ARTICLE VIII

ASSIGNMENTS AND RESIGNATIONS

 

8.1           Assignment,
Resignation and Admission Generally.

 

(a)          Assignments.
Subject to the terms of the Loan Documents and this Section 8.l(a), the Member may assign in whole or in part its Membership Interest
in the Company. If the Member transfers all of its Membership Interest pursuant to this Section 8.1, the transferee shall be admitted
to the Company as a member of the Company upon its execution of an instrument signifying its agreement to be bound by the terms
and conditions of this Agreement, which instrument may be a counterpart signature page to this Agreement. Such admission shall
be deemed effective immediately prior to the transfer and, immediately following such admission, and the Member shall cease to
be a member of the Company. Notwithstanding anything in this Agreement to the contrary, any successor to the Member by merger or
consolidation in compliance with the Basic Documents shall, without further act, be the Member hereunder, and such merger or consolidation
shall not constitute an assignment for purposes of this Agreement and the Company shall continue without dissolution.

 

(b)          Resignation.
So long as any obligation is outstanding under the Loan, the Member may not resign, except as permitted under the Basic Documents.
If the Member is permitted to resign pursuant to this Section 8.l(b), an additional member of the Company shall be admitted to
the Company upon its execution of an instrument signifying its agreement to be bound by the terms and conditions of this Agreement,
which instrument may be a counterpart signature page to this Agreement. Such admission shall be deemed effective immediately prior
to the resignation and, immediately following such admission, and the resigning Member shall cease to be a member of the Company.

 

(c)          Admission
of Additional Members. One or more additional members may be admitted to the Company with the written consent of the Member
or the members, if applicable; provided, however, that, notwithstanding the foregoing, except as otherwise provided in the Loan
Documents, so long as any obligation remains outstanding under the Loan, no additional member may be admitted to the Company pursuant
to this Section 8.l(c) unless approved by the Lender.

 

8.2           Absolute
Prohibition. Notwithstanding any other provision in this Article VIII, the Membership Interest of the Member, in whole or in
part, or any rights to distributions therefrom, shall not be sold, exchanged, conveyed, transferred, pledged, hypothecated, subjected
to a security interest, or otherwise assigned or encumbered, if such action would result in a violation of federal or state securities
laws in the opinion of counsel for the Company.

 

8.3           Additional
Requirements. In addition to all requirements imposed in this Article VIII, any admission of a member or assignment of a Membership
Interest shall be subject to all restrictions relating thereto expressly imposed by the Act.

 

    	 	9	 

     

    

 

8.4           Effect
of Prohibited Action. Any assignment in violation of this Article VIII shall be, to the fullest extent permitted by law, void
and of no force or effect whatsoever.

 

ARTICLE IX

DISSOLUTION AND TERMINATION

 

9.1           Dissolution.
Subject to the other provisions of this Agreement, the Company shall be dissolved upon the first to occur of the following: (a)
the termination of the legal existence of the last remaining member of the Company or the occurrence of any other event which terminates
the continued membership of the last remaining member of the Company unless the Company is continued without dissolution in a manner
permitted by this Agreement or the Act or (b) the entry of a decree of judicial dissolution under Section 18-802 of the Act. Upon
the occurrence of any event that causes the last remaining member of the Company to cease to be a member of the Company or that
causes the Member to cease to be a member of the Company (other than upon continuation of the Company without dissolution upon
(i) an assignment by the Member of all of its Membership Interest and the admission of the transferee pursuant to Section 8.1,
or (ii) the resignation of the Member and the admission of an additional member of the Company pursuant to Section 8.1), to the
fullest extent permitted by law, the personal representative of such member is hereby authorized to, and shall, within ninety (90)
days after the occurrence of the event that terminated the continued membership of such member in the Company, agree in writing
(x) to continue the Company and (y) to admit the personal representative or its nominee or designee, as the case may be, as a substitute
member of the Company, effective as of the occurrence of the event that terminated the continued membership of the last remaining
member of the Company.

 

9.2           Liquidation.
Upon its dissolution, the Company shall wind up its affairs and distribute its assets in accordance with Section 9.4 below and
the Act by either or a combination of the following methods as the Member (or the Person carrying out the liquidation) shall determine:

 

(a)          selling
the Company's assets and, after the satisfaction of Company liabilities, distributing the net proceeds therefrom to the Member;
and/or

 

(b)          subject
to the satisfaction of Company liabilities, distributing the Company's assets to the Member in kind, with the Member accepting
an undivided interest in the Company's assets in satisfaction of its Membership Interest.

 

9.3           Orderly
Liquidation. A reasonable time as determined by the Member (or the Person carrying out the liquidation) shall be allowed for
the orderly liquidation of the assets of the Company and the discharge of liabilities to the creditors so as to minimize any losses
attendant upon dissolution.

 

9.4           Distributions.
Upon dissolution, the Company's assets (including any cash on hand) shall be distributed in the following order and in accordance
with the following priorities:

 

    	 	10	 

     

    

 

(a)          first,
to the satisfaction of the Loan; then

 

(b)          second,
to the satisfaction of the other debts and liabilities of the Company (whether by payment or the making of reasonable provision
for payment thereof) and the expenses of liquidation, including a sales commission to the selling agent, if any; then

 

(c)          third,
to the Member.

 

9.5           Termination.
The Company shall terminate when (i) all of the assets of the Company, after payment of or due provision for all debts, liabilities
and obligations of the Company, shall have been distributed to the Member in the manner provided for in this Agreement and (ii)
the Certificate of Formation shall have been canceled in the manner required by the Act. The existence of the Company as a separate
legal entity shall continue until cancellation of the Certificate of Formation as provided in the Act.

 

ARTICLE X

MISCELLANEOUS PROVISIONS

 

10.1         Governing
Law. This Agreement shall be construed, enforced, and interpreted in accordance with the laws of the State of Delaware, without
regard to conflicts of law provisions and principles thereof.

 

10.2         Indemnity.
The Company shall indemnify and hold harmless any person who was or is a party to any proceeding, including any proceeding brought
by a member in the right of the Company or brought by or on behalf of any member of the Company, by reason of the fact that he
is or was an officer of the Company, against any liability incurred by him in connection with such proceedings unless he engaged
in willful misconduct or knowing violation of the criminal law or any federal or state securities laws. Furthermore, in any such
proceedings brought by or on behalf of the Company or bought by or on behalf of the members of the Company, no officer shall be
liable to the Company or its members for any monetary damages with respect to any transaction, occurrence, course of conduct or
otherwise, except for liability resulting from such officer's having engaged in willful misconduct or a knowing violation of the
criminal law or any federal or state securities laws.

 

10.3         Integrated
and Binding Agreement; Amendment. This Agreement contains the entire understanding and agreement among the parties hereto with
respect to the subject matter hereof, and there are no other agreements, understandings, representations or warranties among the
parties hereto other than those set forth herein. This Agreement may be amended only by written agreement of the Member and only
as provided in this Agreement. Notwithstanding any other provision of this Agreement, the parties hereto agree that this Agreement
constitutes a legal, valid and binding agreement, and is enforceable against each of them in accordance with its terms.

 

10.4         Construction.
Whenever the singular number is used in this Agreement and when required by the context, the same shall include the plural, and
the masculine gender shall include the feminine and neuter genders, and vice versa.

 

10.5         Headings.
The headings in this Agreement are inserted for convenience only and are in no way intended to describe, interpret, define, or
limit the scope, extent, or intent of this Agreement or any provision hereof.

 

    	 	11	 

     

    

 

10.6         Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which shall constitute one
and the same instrument.

 

10.7         Severability.
If any provision of this Agreement or the application thereof to any Person or circumstance shall be invalid, illegal, or unenforceable
to any extent, the remainder of this Agreement and the application thereof shall not be affected and shall be enforceable to the
fullest extent permitted by law.

 

10.8         Notices.
All notices under this Agreement shall be in writing and shall be given to the party entitled thereto by personal service or by
mail, posted to the address maintained by the Company for such person or at such other address as he may specify in writing.

 

10.9         Rights
and Remedies Cumulative; Waivers. The rights and remedies provided by this Agreement are cumulative and the use of any one
right or remedy by any party shall not preclude or waive the right to use any or all other remedies, and are given in addition
to any other rights the parties may have by law, statute, ordinance, or otherwise. The failure of any party to seek redress for
violation of or to insist upon the strict performance of any covenant or condition of this Agreement shall not prevent a subsequent
act, which would have originally constituted a violation, from having the effect of an original violation.

 

10.10         Heirs.
Successors, and Assigns. Each and all of the covenants, terms, provisions, and agreements herein contained shall be binding
upon, and inure to the benefit of, the parties hereto and, to the extent permitted by this Agreement, their respective heirs, legal
representatives, successors, and assigns.

 

10.11         Partition.
Each Member agrees that the assets of the Company are not and will not be suitable for partition. Accordingly, each Member hereby
irrevocably waives (to the fullest extent permitted by law) any and all rights that he may have, or may obtain, to maintain any
action for partition of any of the assets of the Company.

 

10.12         Tax
Status. It is the intention of the Member that the Company be a disregarded entity for federal income tax purposes under Section
7701 of the Code and the Treasury Regulations promulgated pursuant thereto.

 

10.13         Effective
Date. Pursuant to Section 18-201(d) of the Act, this Agreement shall be effective as of the time of the filing of the Certificate
of Formation with the Office of the Delaware Secretary of State.

 

    	 	12	 

     

    

 

ARTICLE XI

DEFINITIONS

 

In addition to any other
defined terms herein, the following terms used in this Agreement shall have the following meanings (unless otherwise expressly
provided herein):

 

(a)          "Affiliate"
shall mean any Person controlling or controlled by or under common control with the Company, including, without limitation (i)
any person who has a familial relationship, by blood, marriage or otherwise with any Member or employee of the Company, or any
Affiliate thereof and (ii) any Person which receives compensation for administrative, legal or accounting services from the Company,
or any of its Affiliates. For purposes of this definition, "control" when used with respect to any specified Person,
means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of
voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative
to the foregoing.

 

(b)          "Bankruptcy"
shall mean, with respect to any Person, if such Person (i) makes an assignment for the benefit of creditors, (ii) files a voluntary
petition in bankruptcy, (iii) is adjudged a bankrupt or insolvent, or has entered against it an order for relief, in any bankruptcy
or insolvency proceedings, (iv) files a petition or answer seeking for itself any reorganization, arrangement, composition, readjustment,
liquidation or similar relief under any statute, law or regulation, (v) files an answer or other pleading admitting or failing
to contest the material allegations of a petition filed against it in any proceeding of this nature, (vi) seeks, consents to or
acquiesces in the appointment of a trustee, receiver or liquidator of the Person or of all or any substantial part of its properties,
or (vii) if 120 days after the commencement of any proceeding against the Person seeking reorganization, arrangement, composition,
readjustment, liquidation or similar relief under any statute, law or regulation, if the proceeding has not been dismissed, or
if within 90 days after the appointment without such Person's consent or acquiescence of a trustee, receiver or liquidator of such
Person or of all or any substantial part of its properties, the appointment is not vacated or stayed, or within 90 days after the
expiration of any such stay, the appointment is not vacated. The foregoing definition of "Bankruptcy" is intended to
replace and shall supersede and replace the definition of "Bankruptcy" set forth in Sections 18-101(1) and 18-304 of
the Act.

 

(c)          "Basic
Documents" shall mean collectively this Agreement, the Loan Documents, the Property Management Agreement and all documents
and certificates contemplated thereby or delivered in connection therewith.

 

(d)          "Capital
Contribution" shall mean any contribution to the capital of the Company by the Member in cash, property, or services, or a
binding obligation to contribute cash, property, or services, whenever made.

 

(e)          "Certificate
of Formation" shall mean the Certificate of Formation of the Company, as amended and in force from time to time.

 

(f)          “Closing
Date” shall mean the date on which the Company acquires the Mortgaged Property.

 

(g)          “Company
Interest” shall mean any equity interest in the Company, direct or indirect.

 

(h)          "Code" shall mean the Internal Revenue Code of 1986, as amended, or corresponding provisions of subsequent
superseding federal revenue laws and the rules and regulations promulgated thereunder.

 

    	 	13	 

     

    

 

(i)          “Company
shall mean BR CARROLL GLENRIDGE, LLC.

 

(j)          "Entity"
shall mean any general partnership, limited partnership, limited liability company, corporation, joint venture, trust, business
trust, cooperative, association or other entity.

 

(k)          “Lender”
is defined in Section 3.5 of this Agreement.

 

(l)          "Loan"
is defined in Section 1.2 of this Agreement.

 

(m)          “Loan
Agreement” mean that certain loan agreement, dated October 13, 2016, in the amount of Forty Eight Million Four Hundred Thirty
One Thousand and No/100 Dollars ($48,431,000.00) by and between Lender and the Company.

 

(n)          "Loan
Documents" shall mean collectively the Note, the Mortgage, any guaranty, assignment, indemnity agreement, escrow agreement,
or the functional equivalent of any of the aforementioned, and any and all other documents evidencing or securing the Loan and
any and all documents related thereto.

 

(m)          "Member"
shall mean the Person identified in Article II hereof and includes any Person admitted as an additional member or a substitute
member of the Company pursuant to the provisions of this Agreement, each in its capacity as a member of the Company; provided,
however, the term "Member" shall not include the Special Member.

 

(n)          “Member
Cessation Event” shall have the meaning prescribed in Section 2.2 of this Agreement.

 

(o)          "Membership
Interest" shall mean the Member's limited liability company interest in the Company and the other rights and obligations with
respect thereto as set forth in this Agreement. The Membership Interest is set forth beside the Member's name in Article II of
this Agreement.

 

(p)          "Mortgage"
shall mean that certain security instrument executed by the Company in favor of the Lender pursuant to which the Company grants
a mortgage lien to Lender against the Mortgaged Property.

 

(q)          “Mortgaged
Property” is defined in Section 1.1 of this Agreement.

 

(r)          “Note”
shall mean that certain promissory note related to the Loan and evidencing the Loan Agreement.

 

(s)          "Person"
shall mean any individual, corporation, partnership, limited liability company, joint venture, association, joint stock company,
trust (including any beneficiary thereof), unincorporated organization, or government or any agency or political subdivision thereof.

 

(t)          “Personalty”
shall have the meaning prescribed in the Loan Agreement.

 

(u)          "Property
Manager" shall mean Carroll Management Group, LLC, a Georgia limited liability company, and its successors and assigns, so
long as the initial Property Management Agreement is in full force and effect and, thereafter, the entity performing similar services
for the Company with respect to the Mortgaged Property.

 

    	 	14	 

     

    

 

(v)         "Property
Management Agreement" shall mean that certain management agreement between the Company and the Property Manager with respect
to the management of the Mortgaged Property.

 

(w)          “Rating
Agency” shall have the meaning prescribed in the Loan Agreement.

 

(x)          "Special
Member" shall mean, upon such Springing Member’s admission to the Company as a member of the Company, the Person bound
by this Agreement as Special Member in such Person's capacity as a member of the Company. A Special Member shall only have the
rights and duties expressly set forth in this Agreement.

 

(y)          “Special
Purpose Entity” is defined in Section 1.7 of this Agreement.

 

(z)          “Springing
Member 1” shall be Michael L. Konig or any successor to him.

 

(aa)         “Springing
Member 2” shall be Jordan B. Ruddy or any successor to him.

 

(bb)         “Supplemental
Loan” shall have the meaning prescribed in the Loan Agreement.

 

(cc)         “Transfers”
shall have the meaning prescribed in the Loan Agreement.

 

[REMAINDER OF THIS PAGE
INTENTIONALLY LEFT BLANK]

 

    	 	15	 

     

    

 

The undersigned
hereby agree, acknowledge, and certify that the foregoing constitutes the sole and entire Limited Liability Company Agreement of
the Company.

 

	   MEMBER:	BR Carroll Glenridge JV, LLC,
	 	a Delaware limited liability company

 

	 	By:	BR Glenridge JV Member, LLC, 
	 	 	a Delaware limited liability company, its manager

 

	 	By: 	BRG Glenridge, LLC, 
	 	 	a Delaware limited partnership, its manager

 

	 	By:	Bluerock Residential Holdings, LP
	 	 	a Delaware limited partnership, its sole member

 

	 	By:	Bluerock Residential Growth REIT, Inc., 
	 	 	a Maryland corporation, its general partner

 

	 	By: 	/s/ R. Ramin Kamfar	 
	 	Name:	R. Ramin Kamfar	 
	 	Title: 	Authorized Signatory	 
	 	 	 	 
	   SPRINGING
    MEMBER 1:	By: 	/s/ Michael L. Konig	 
	 	Name:	Michael L. Konig	 
	 	 	 	 
	   SPRINGING
    MEMBER 2:	By: 	/s/ Jordan B. Ruddy	 
	 	Name:	Jordan B. Ruddy	 

 

    	 	16

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