Document:

Exhibit 10.24

 

 

 

OPERATING AGREEMENT

OF

NPT INVESTORS, LLC

 

 

 

    	 

    	 

    

 

TABLE OF CONTENTS

 

	 	PAGE
	 	 
	TABLE OF CONTENTS	i
	ARTICLE 1 DEFINITIONS	2
	Section 1.01	Definitions	2
	ARTICLE 2 GENERAL PROVISIONS	10
	Section 2.01.	Name 	10
	Section 2.02.	Filing Of Certificates	10
	Section 2.03.	Purpose	10
	Section 2.04.	Powers	10
	Section 2.05.	Principal Business Office	10
	Section 2.06.	Limited Liability	11
	Section 2.07.	Title To Company Property	11
	Section 2.08.	No Right Of Partition	11
	ARTICLE 3 UNITS; CAPITAL CONTRIBUTIONS	11
	Section 3.01.	Units	11
	Section 3.02.	Common Member Interest	11
	Section 3.03.	Preferred Interests	11
	Section 3.04.	Ranking of Preferred Interests	12
	ARTICLE 4 PREFERRED UNITS	12
	Section 4.01.	Mandatory Monthly Distributions	12
	Section 4.02.	Liquidation Preference	13
	Section 4.03.	Redemption	14
	Section 4.04.	Redemption Procedures 	16
	ARTICLE 5 ALLOCATIONS	16
	Section 5.01.	Net Profit	16
	Section 5.02.	Net Loss	16
	Section 5.03.	Allocations in Specified Circumstances	17
	Section 5.04.	Tax Allocations	17
	ARTICLE 6 OTHER DISTRIBUTIONS	17
	Section 6.01.	Distributions	17
	Section 6.02.	Authority to Withhold; Treatment of Withheld Tax	18
	Section 6.03.	Dissolution	18
	ARTICLE 7 MANAGEMENT OF COMPANY	18
	Section 7.01.	Management	18
	Section 7.02.	Approval Rights	19
	Section 7.03.	Officer	21
	Section 7.04.	Lack of Authority	21
	Section 7.05.	Limitations on the Company's Activities	21
	ARTICLE 8 TAX AND ACCOUNTING MATTERS: BOOKS AND RECORDS	22
	Section 8.01.	Fiscal Year 	22
	Section 8.02.	Partnership for Tax Purposes	22
	Section 8.03.	Tax Matters 	22

 

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	Section 8.04.	Books and Records	22
	Section 8.05.	Annual Budgets	22
	ARTICLE 9 CERTAIN COVENANTS	23
	Section 9.01.	Single Purpose Entity	23
	ARTICLE 10 DISPOSITION OF UNITS;
    TRIGGER EVENTS AND CONSEQUENCES	25
	Section 10.01.	Transfers	25
	Section 10.02.	Trigger Events	26
	Section 10.03.	Consequences of Trigger Event	27
	ARTICLE 11 EXCULPATION AND INDEMNIFICATION	29
	Section 11.01.	Exculpation and Indemnification.	29
	Section 11.02.	Waiver of Corporate Opportunity	31
	ARTICLE 12 TERMINATION, DISSOLUTION AND LIQUIDATION	31
	Section 12.01.	Term	31
	Section 12.02.	Winding Up Events	31
	Section 12.03.	Winding Up	32
	Section 12.04.	Distribution Upon Dissolution of the Company	32
	Section 12.05.	Rights of Members; Resignation	33
	ARTICLE 13 MISCELLANEOUS	33
	Section 13.01.	Notices	33
	Section 13.02.	Amendments; No Waivers	34
	Section 13.03.	Expenses	34
	Section 13.04.	Successors and Assigns	34
	Section 13.05.	Headings	34
	Section 13.06.	Governing Law	34
	Section 13.07.	Counterparts; Effectiveness	35
	Section 13.08.	Severability	35
	Section 13.09.	Further Assurances	35
	Section 13.10.	Entire Agreement	35

 

	Schedule A	Membership Interests
	Schedule B	Property Owner's Amended and Restated Limited Liability Company Agreement

 

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OPERATING AGREEMENT

 

OF

 

NPT INVESTORS, LLC

 

THIS
OPERATING AGREEMENT (this "Agreement") of NPT Investors, LLC, a Delaware limited liability company (the "Company"),
is made and entered into as of April 30, 2013 (the "Effective Date"), by and among Bluerock Real Estate, LLC,
a Delaware limited liability company ("Manager"), the persons whose names are set forth on Schedule A of
this Agreement (the "Common Members"), and Bluerock Special Opportunity +
Income Fund III, LLC, a Delaware limited liability company ("SOIF"), as the
Preferred Member.

 

RECITALS:

 

WHEREAS,
the Company was formed on April 29, 2013 in connection with the intended contribution (the "Transfer Distribution")
to BR-NPT Springing Entity, LLC (the "Property Owner") of the apartment project known as ''North Park Towers"
and located at 16500 North Park Drive, Southfield, Oakland County, Michigan (the "Property"), by BR-North Park
Towers, DST, a Delaware statutory trust (the "DST" or the "Trust") pursuant to that certain trust
agreement of the DST (the "Trust Agreement").

 

WHEREAS,
simultaneous with the Transfer Distribution, that certain mortgage loan in the original principal amount of $15,000,000 secured
by the Property (the "Previous Loan"), borrowed by the Trust from Bank of America and now owned/controlled by
Midland Loan Services as Special Servicer (the "Previous Lender"), is being repaid (the "Refinancing Transaction")
with the proceeds of a mortgage loan in the face amount of $10,000,000 (together with any loan that refinances such loan, the "Mortgage
Loan") from KeyBank National Association (together with its successors and assigns thereof, and any lender under any loan
that refinances the Mortgage Loan, the "Mortgage Lender").

 

WHEREAS,
simultaneous with the Transfer Distribution and the Refinancing Transaction described above, the Property Owner is being recapitalized
pursuant to a capital call (the "Recapitalization") and certain other transactions (the "Proposed Actions")
voted upon and approved by the owners of the DST in connection with that certain Proposed Action Notice dated April 11, 2013 (the
"Action Notice").

 

WHEREAS,
in connection with the Recapitalization of the Property Owner, the Company will invest a total of $1,969,289.00 in the Property
Owner, in exchange for which the Company will be issued 754.20 Common Membership Interests in the Property Owner, representing
ownership of seventy-five and forty-two one-hundredths percent (75.42%) of the Property Owner (collectively, the "Company
Investment"). A true copy of the Property Owner's Amended and Restated Limited Liability Company Agreement is attached
hereto as Schedule B.

 

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WHEREAS,
SOIF is contributing to the Company the Preferred Contribution (defined below), and the Common Members are contributing to the
Company the Common Member Contribution (defined below), each asof the Effective Date (the "Closing Date"), to
enable the Company to make the Company Investment in the Property Owner, to enable the Property Owner, simultaneous with its receipt
of other Recapitalization proceeds and the net proceeds from Mortgage Lender under the Refinancing Transaction, to repay the Previous
Loan and thereby permit the DST to complete the Transfer Distribution, to result in Property Owner succeeding to full ownership
of the Property subject to the Mortgage Loan.

 

WHEREAS,
the Manager and the Members now wish to provide for, among other things, (i) the admission
of SOIF as a Preferred Member of the Company, (ii) the payment of the Preferred Contribution by SOIF to the Company, (iii) the
payment of the Common Member Contribution by the Common Members to the Company, (iv) the making by the Company of the Company Investment
in Property Owner to become a common member of the Property Owner, the allocation of Profits, Losses, credits and distribution
of cash flow and other proceeds of the Company, and (vi) the respective rights, obligations and interests of the Members to each
other and to the Company, all as hereinafter provided.

 

NOW,
THEREFORE, in consideration of the mutual covenants and agreements herein, the parties agree to enter into this Agreement as of
the Effective Date as follows:

 

ARTICLE 1

 

DEFINITIONS

 

Section
1.01.     Definitions. (a) As used herein, the following terms have the following meanings:

 

"Affiliate"
means, with respect to any specified Person any other Person owning beneficially, directly or indirectly, any ownership interest
in such specified Person or directly or indirectly controlling or controlled by or under direct or indirect common control with
such specified Person. For purposes of this definition, "control," when used with respect to any specified Person, shall
mean 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" shall have meanings correlative
to the foregoing.

 

"Agreement" has
the meaning set forth in the Preamble hereto.

 

"Annual
Budget" means the operating budget, including all planned capital expenditures, for the Property prepared by the Property
Owner for the applicable Fiscal Year or other period.

 

"Bankruptcy"
means, 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 Property,
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 Property, 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(l) and 18-304 of
the Delaware Act.

 

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"Bluerock"
means Bluerock Real Estate, L.L.C., a Delaware limited liability company.

 

"BRPM" means Bluerock Property Management,
LLC.

 

"Business
Day" means a day which is not a Saturday, Sunday or legal holiday on which commercial banking institutions in New York,
New York are authorized to close.

 

"Capital
Account" means an account maintained for each Member to which shall be credited the amount of money and fair market value
of any property (net of any liabilities to which such property is subject) contributed to the Company by such Member and any Net
Profit allocated to such Member pursuant to Article 5, and to which shall be debited the amount of money and fair market
value of any property (net of any liabilities to which such property is subject) distributed by the Company to such Member and
any Net Loss allocated to such Member pursuant to Article 5. Such Capital Account shall be maintained solely for purposes
of determining the allocations of Net Profit and Net Loss under Article 5 for income tax purposes and shall not have any
effect on the Members' rights to distributions from the Company.

 

"Capital
Contribution'' shall mean the gross amount invested in the Company by a Member, whether in cash, property or services.

 

"Casualty"
means any damage or destruction, in whole or in part, by fire or other casualty of all or any part of the Property.

 

"Closing
Date" means the Effective Date.

 

"Code"
means the Internal Revenue Code of 1986, as amended from time to time.

 

"Commercial
Disposition Effort" has the meaning set forth in Section 10.03(b).

 

''Common
Member" means a Member who is a holder of Common Units, acting in its capacity as such.

 

"Common
Percentage Interest" means, with respect to any Common Member at any time, the percentage derived by dividing (i) the
aggregate number of Common Units held by such Common Member as of such time by (ii) the aggregate
number of Common Units held by all Common Members as of such time.

 

"Common
Units" has the meaning set forth in Section 3.01.

 

"Company"
has the meaning set forth in the Preamble hereto.

 

"Company
Optional Redemption" has the meaning set forth in Section 4.03(a).

 

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"Condemnation"
means a temporary or permanent talking by any governmental authority as the result or in lieu or in anticipation of the exercise
of the right of condemnation or eminent domain, of all or any part of the Property, or any interest therein or right accruing thereto,
including any right of access thereto or any change of grade affecting the Property or any part thereof.

 

"Condemnation
Proceeds" means the proceeds arising out of any Condemnation action, whether paid in connection with a final ruling, a
deed in lieu or any other related proceeding, net of any costs of collection.

 

"Control"
(including the correlative terms "controlling", "controlled by" and "under common control
with") means the possession, directly or indirectly, of the power to direct or cause the direction of management and policies
of the business and affairs of the entity in question by reason of the ownership of beneficial interests, by contract or otherwise.

 

"Covered
Persons" has the meaning set forth in Section 11.01(a).

 

"Covered Sale'' has the meaning set forth in
Section 4.03(b).

 

"Creditors'
Rights Laws" shall mean with respect to any Person, any existing or future law of any jurisdiction, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, conservatorship, arrangement, adjustment, winding-up, liquidation, dissolution,
composition or other relief with respect to its debts or debtors.

 

"Delaware
Act'' means the Delaware Limited Liability Company Act, 6 Del. Code Section 18-101, el seq.

 

"Distribution
Period" means, with respect to any Preferred Payment Date, the period commencing on and
including the fifteenth (15th) day of the preceding calendar month and terminating on and including the fourteenth
(14th day) of the calendar month in which such Preferred Payment Date occurs; provided, however, that
the initial Distribution Period shall begin on and include the Closing Date and shall end on and include June 15, 2013.

 

"DST"
and the "Trust" have the meaning set forth in the Recitals hereto.

 

"Effective
Date" has the meaning set forth in the preamble hereto.

 

"Fiscal
Year" has the meaning set forth in Section 8.01.

 

"GAAP"
means United States generally accepted accounting principles as in effect from time to time.

 

"Guarantor"
or "Guarantors" means, individually or collectively, as the context may require, Bluerock Special Opportunity
+ Income Fund, LLC, Bluerock Special Opportunity + Income Fund II, LLC and Bluerock Special Opportunity + Income Fund III, LLC.

 

"Guaranty"
or "Guarantees" means, individually or collectively, as the context may require, the Guaranty Agreement and Environmental
and Hazardous Substances Indemnity Agreement and the other documents executed by Guarantors in connection with the Mortgage Loan
Documents.

 

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"Insurance
Proceeds" means any proceeds payable with respect to any insurance policies affecting the Property in connection with
any destruction or casualty to the Property, net of any expenses of collection.

 

"Interest"
means, with respect to any Member, such Member's limited liability company interest in the Company.

 

"Junior
Securities" means any Common Units or any other limited liability company interests issued by the Company that would rank
junior to the Preferred Units as to periodic distributions or distributions upon a liquidation or dissolution of the Company.

 

"Junior Securities Distribution"
has the meaning set forth in Section 4.0l(d).

 

"Lien"
means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind (other than
restrictions under applicable securities laws).

 

"Liquidation
Event" has the meaning set forth in Section 4.02(b).

 

"Liquidation
Preference" means, as of any date of determination, with respect to each Preferred Unit, the Total Redemption Amount divided
by the total number of Preferred Units outstanding.

 

"Manager"
has the meaning set forth in Section 7.01(a).

 

"Material
Action" means (a) to file any bankruptcy, insolvency, or reorganization case or proceeding, (b) to institute proceedings
to have the Company be adjudicated bankrupt or insolvent, (c) to institute proceedings under any applicable insolvency law to have
the Company be adjudicated bankrupt or insolvent, (d) to seek any relief under any law relating to relief from debts or the protection
of debtors generally, (e) to consent to the filing or institution of bankruptcy, reorganization or insolvency proceedings against
the Company, (f) to file a petition seeking, or consent to, bankruptcy, insolvency, reorganization or relief with respect to the
Company under any applicable federal or state law relating to bankruptcy or insolvency, (g) to seek or consent to the appointment
of a receiver, liquidator, assignee, trustee, sequestrator, custodian, or any similar official of or for the Company or a substantial
part of its property, (h) to make any assignment for the benefit of creditors of the Company, (i) to admit in writing the
Company's inability to pay its debts generally as they become due or (j) to take action in furtherance
of any of the foregoing.

 

"Material
Adverse Effect" means any event or condition that has a material adverse effect on (i) the Property taken as a whole,
(ii) the use, operation, or value of the Property, (iii) the business, profits, operations or financial condition of the Company,
or (iv) the ability of the Company to satisfy any of the Company's obligations under this Agreement.

 

"Member"
means any Person that holds a limited liability company interest in the Company and is admitted
as a member of the Company pursuant to the provisions of this Agreement and the Delaware Act.

 

"Monthly
Distribution Shortfall" means the failure to pay on any Preferred Payment Date, any Preferred Monthly Distribution.

 

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"Mortgage
Debt" means the outstanding portion of the principal amount set forth in, and evidenced by, the Mortgage Loan Documents
together with all interest accrued and unpaid thereon and all other sums due to Mortgage Lender in respect of the Mortgage Loan.

 

"Mortgage Lender"
has the meaning set forth in the Recitals hereto.

 

"Mortgage
Loan" means (a) the loan in the original face amount of Ten Million and No/100 Dollars ($10,000,000.00), made by KeyBank
National Association to the Property Owner and (b) any loan that refinances such loan.

 

"Mortgage
Loan Default" means an "Event of Default" under the Mortgage Loan Documents subject to all applicable
notice, grace and cure periods related thereto, but regardless of whether or not such Event of Default is or may have been waived
by Mortgage Lender.

 

"Mortgage
Loan Documents" means all documents or instruments evidencing, securing or guaranteeing any portion of the Mortgage Debt,
including, without limitation, any loan agreement, note, mortgage, pledge, security agreement, control agreement, deposit agreement
or other written agreement or document evidencing or securing the Mortgage Debt.

 

"Net Proceeds"
has the meaning set forth in Section 4.03(b)(v).

 

"Net
Profit" or "Net Loss" means, for each fiscal year or other period, an amount equal to the Company's taxable
income or loss for such year or period, determined in accordance with Code Section 703(a) (for this purpose, all items of income,
gain, loss or deduction required to be stated separately pursuant to Code Section 703(a)(1) shall be included in taxable income
or loss), with the following adjustments:

 

(i)          any
income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Net Profit or Net
Loss shall be added to such taxable income or loss; and

 

(ii)         the
computation of Net Profit or Net Loss shall include any expenditures of the Company described in Code Section 705(b)(2)(B) or treated
as Code Section 705(b)(2)(B) expenditures pursuant to Regulations Section 1.704-1(b)(2)(iv)(i)
and not otherwise taken into account in computing Net Profit or Net Loss shall be subtracted to such taxable income or loss.

 

The
Tax Matters Partner shall make further adjustments as the Tax Matters Partner shall deem necessary in its reasonable discretion.

 

"Net
Sales Proceeds" means the proceeds from the sale of the Property after deducting therefrom all expenses incurred in connection
with the sale, including any applicable commissions or sales fees, provided however, disposition or similar sales fees earned by
or payable to the Manager or its Affiliates in connection with the sale by the Property Owner of the Property shall be subordinated
to the receipt by the Preferred Member of its Total Redemption Amount.

 

"OFAC
List" means the list of specially designated nationals and blocked persons subject to financial sanctions that is maintained
by the U.S. Treasury Department, Office of Foreign Assets Control and accessible through the internet website www.treas.gov/ofoc/t11sdn.pdf.

 

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"Ownership
Interest" means any direct ownership interest in the Company, contingent or fixed, of any nature whatsoever, whether in
the form of a partnership interest, stock interest, membership interest, equitable interest, beneficial interests, profit interest,
loss interest, voting rights, control rights, management rights or otherwise.

 

"Parity
Securities" has the meaning set forth in Section 3.04(b). 

 

"Permitted Transfer" has the meaning
set forth in Section 10.01(a).

 

"Person"
means an individual, corporation, partnership, association, trust, limited liability company or any other entity or organization,
including a government or political subdivision or an agency, unit or instrumentality thereof.

 

"Preferred
Contribution" means one million seven hundred nineteen thousand two hundred eighty nine and no/100 Dollars ($1,719,289.00).

 

"Preferred
Member" means the Preferred Member described in the Preamble hereto and each other Member who is a holder of Preferred
Units, acting in its capacity as such.

 

"Preferred
Member Transferee" means a permitted transferee of any holder of Preferred Units who is admitted to the Company as a Preferred
Member pursuant to Section 10.01(d).

 

"Preferred
Monthly Distribution" has the meaning set forth in Section 4.01(a).

 

"Preferred
Payment Date" means the fifteenth (15th) day of each calendar month or, if such day is not a Business
Day, the immediately preceding Business Day.

 

"Preferred
Percentage Interest" means, with respect to any Preferred Member at any time, the percentage derived by dividing (i) the
aggregate number of Preferred Units held by such Preferred Member as of such time by (ii) the
aggregate number of Preferred Units held by all of the Preferred Members as of such time.

 

"Preferred
Return" means the amounts payable to the holders of Preferred Units pursuant to Section 4.01(a).

 

"Preferred
Return Rate" means, with respect to any period of calculation, a rate per annum equal to thirty five percent (35%) per
annum.

 

"Preferred Units"
has the meaning set forth in Section 3.01.

 

"Previous Loan"
has the meaning set forth in the Recitals hereto.

 

"Previous Lender"
has the meaning set forth in the Recitals hereto.

 

"Prohibited Person"
means any Person:

 

(a)          listed
in the Annex to, or otherwise subject to the provisions of, the Executive Order No. 13224 on Terrorist Financing, effective September
24, 2001, and relating to Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support
Terrorism (the "Executive Order");

 

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(b)          that
is owned or controlled by, or acting for or on behalf of, any Person that is listed on the Annex to, or is otherwise subject to
the provisions of, the Executive Order;

 

(c)          with
whom any Member is prohibited from dealing or otherwise engaging in any transaction by any terrorism or money laundering law, including
the Executive Order;

 

(d)          who
commits, threatens or conspires to commit or supports "terrorism" as defined in the Executive Order;

 

(e)          that
is named as a "specially designated national and blocked person" on the most current list published by the U.S. Treasury
Department Office of Foreign Assets Control at its official website, http://www.treas.gov.ofac/tllsdn.pdf or at any replacement
website or other replacement official publication of such list; or

 

(t)          who
is an Affiliate of a Person listed above.

 

"Property"
means the 313-unit townhome complex located at located at 16500 North Park Drive, Southfield, Oakland County, Michigan, all improvements
thereon and all personal property owned by the Property Owner, together with all rights pertaining to such property and improvements,
as more particularly described in the Mortgage Loan Documents.

 

"Property
Manager" means (a) as of the Closing Date, BRPM (provided, that the Property Manager may sub-contract some or all
of its management responsibilities under the Property Management Agreement subject to any requirements of the Mortgage Loan Documents),
or (b) if the context requires, such successor Property Manager who is managing the Property.

 

"Property
Management Agreement" means (a) that certain Property Management Agreement to be entered into by and between the Property
Owner and the Property Manager, pursuant to which the Property Manager is to provide management and other services with respect
to the Property, and (b) any replacement management agreement entered into by and between the Property Owner and a successor Property
Manager.

 

"Regulations"
means the Treasury Regulations, including Temporary Regulations, promulgated under the Code, as such regulations are in
effect from time to time. References to specific provisions of the Regulations include references to corresponding provisions of
successor regulations.

 

"Senior
Securities'' has the meaning set forth in Section 3.04(b).

 

"Schedule
A" means Schedule A to this Agreement, as amended from time to time in accordance with the terms of this
Agreement. The Manager shall amend Schedule A to reflect (i) any increase in the capital contribution made by the
Members and (ii) any permitted transfers of Units, in each case in accordance with the terms of this Agreement and shall
deliver copies of such revised Schedule A to all Members.

 

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"SOIF"
has the meaning set forth in the Recitals.

 

"Special Purpose
Provisions" has the meaning set forth in Section 7.05(b).

 

"Subsidiary"
with respect to any Person means any other Person of which (i) such first-mentioned Person, or its Subsidiary, is the general partner
or manager or (ii) such first-mentioned Person (either directly or through or together with another Subsidiary of such first-mentioned
Person) owns more than 50% of the voting stock (or its equivalent) or value.

 

"Tax
Matters Partner" has the meaning set forth in Section 8.03(a).

 

"Third
Party" means any Person who is not an Affiliate of any Member or of the Manager.

 

"Total
Redemption Amount" means, as of any date of determination, an amount equal to, without duplication, the sum of (a) the
Unreturned Preferred Contribution, plus (b) all accrued but unpaid Preferred Return through and including the end
of the applicable Distribution Period in which such payment occurs.

 

"Transfer"
means any direct or indirect, voluntary or involuntary, sale, transfer, exchange, pledge, hypothecation, encumbrance, assignment
or other disposition, by operation of law or otherwise, by any Member to any Person of all or any portion of such Member's Units
(or any interest therein) and "Transfer", used as a verb, has a corresponding meaning.

 

"Trigger Event"
has the meaning set forth in Section 10.02(a).

 

"UCC"
means the Uniform Commercial Code in effect in the state of Delaware from time to time.

 

"Unallocated
Preferred Return" means, with respect to the Preferred Units at any time, the excess, if any, of (i) aggregate Preferred
Monthly Distributions that have been paid (or, with respect to any Preferred Monthly Distribution that has accrued but is not yet
payable as of such time, to the extent that such Distribution is paid on or within 5 days after the Preferred Payment Date
with respect to such Preferred Monthly Distribution) with respect to the Preferred Units over (ii) the net cumulative amount of
Net Profit allocated to the Preferred Units pursuant to Section 5.01(c).

 

"Units"
means units representing the limited liability company interests of the Company, denominated as Common Units and Preferred Units.

 

"Unreturned
Preferred Contribution" means, as of any date of determination, that portion of the Preferred Contribution that has not
been redeemed, plus the aggregate amount of all accrued but unpaid distributions thereon (whether or not earned or
declared) through the date of payment.

 

"Winding Up Event"
has the meaning set forth in Section 12.02.

 

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(b)       The
words "hereof ", "herein" and "hereunder" and words of like import used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this Agreement. The captions herein are included for convenience
of reference only and shall be ignored in the construction or interpretation hereof. References to Articles, Sections, Exhibits
and Schedules are to Articles, Sections, Exhibits and Schedules of this Agreement unless otherwise specified. All Exhibits and
Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in
full herein. Any capitalized terms used in any Exhibit or Schedule but not otherwise defined therein, shall have the meaning as
defined in this Agreement. Any singular term in this Agreement shall be deemed to include the plural, and any plural te1111 the
singular. Whenever the words "include", "includes" or "including" are used in this Agreement, they
shall be deemed to be followed by the words "without limitation", whether or not they are in fact followed by those words
or words of like import. "Writing", "written" and comparable terms refer to printing, typing and other means
of reproducing words (including electronic media) in a visible form.

 

ARTICLE 2 

 

GENERAL PROVISIONS

 

Section 2.01.   Name. The name of
the Company is "NPT Investors, LLC".

 

Section
2.02.  Filing Of Certificates. Christopher Vohs, as an "authorized person" within the meaning of the Delaware
Act, has executed, delivered and filed the Certificate of Formation of the Company with the office of the Secretary of State of
the State of Delaware. Upon the filing of such Certificate, his powers as an "authorized person" ceased and the Manager
became the designated "authorized person" within the meaning of the Delaware Act. The Manager shall execute, deliver
and file, or cause the execution, delivery and filing of, all other certificates required or permitted by the Delaware Act to be
filed in the Office of the Secretary of State of the State of Delaware and any other certificates, notices or documents required
or permitted by Law for the Company to qualify to do business in any jurisdiction in which
the Company may wish to conduct business.

 

Section
2.03.  Purpose. The purpose of the Company is to engage in any lawful act or activity for which limited liability
companies may be formed under the Delaware Act. Notwithstanding the foregoing, so long as any Preferred Units, the Mortgage Loan
and/or any other loan secured by the Property are outstanding, the Company shall not engage in any business other than owning common
membership interests in the Property Owner subject to the terms and conditions of this Agreement.

 

Section
2.04.  Powers. In furtherance of its purposes, but subject to all of the provisions of this Agreement, the Company
shall have and may exercise all the powers now or hereafter conferred by Delaware law on limited liability companies formed under
the Delaware Act. The Company shall have the power to do any and all acts necessary, appropriate, proper, advisable, incidental
or convenient to or for the protection and benefit of the Company, and shall have, without limitation, any and all of the powers
that may be exercised on behalf of the Company by a Member.

 

Section
2.05.  Principal Business Office. The principal business office of the Company shall be at 712 Fifth Avenue, 9th Floor,
New York, New York 10019, or at such other location as may hereafter be determined by the Manager.

 

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Section
2.06.   Limited Liability. Except as required by the Delaware Act, the debts, obligations and liabilities of the Company,
whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and the
Members shall not be obligated personally for any such debt, obligation or liability of the Company solely by reason of being a
Member of the Company.

 

Section
2.07.   Title To Company Property. All property of the Company, whether real or personal, tangible or intangible, shall
be deemed to be owned by the Company as an entity, and no Member, individually, shall have any direct ownership interest in such
property.

 

Section
2.08.   No Right Of Partition. No Member shall have the right to seek or obtain partition by court decree or operation
of law of any Company property, or the right to own or use particular or individual assets of the Company.

 

ARTICLE 3

 

UNITS; CAPITAL CONTRIBUTIONS

 

Section
3.01.   Units. The Company shall be authorized to issue common Units at a value of $1.00 per common Unit in cash ("Common
Units") and one series of preferred Units at a value per preferred Unit of $1.00 in cash ("Preferred Units")
from time to time in accordance with this Agreement.

 

Section
3.02.  Common Member Interest. (a) The Capital Contribution of each of the Common Members is equal to the percentage
interest held by such Common Member in the Company. The number of Common Units issued to and held by each Common Member in
exchange for its Capital Contribution as of the Closing Date (collectively, the "Common Member
Contributions") are set forth opposite each Common Member's name on Schedule A. The Common Units reflected on Schedule
A as of the Closing Date represent 100% of Common Units outstanding and issued by the Company as of the Closing Date.

  

(b)
Subject to the provisions of this Article 3, the Common Members may from time to time make additional capital contributions
to the Company for use for any purposes set forth in this Agreement if and only if such capital contributions are requested in
writing by the Manager; provided that such capital contributions represent consideration for the issuance of Common Units.
The Common Members may participate on a pro rata basis in proportion to each Common Members Common Units. The Common Members are
not required to comply with such request. The Manager shall amend Schedule A to reflect such additional Common Units set
forth opposite the Common Member's name and shall deliver a copy of such revised Schedule A to the Preferred Member and
all other Members.

 

Section
3.03.   Preferred Interests. (a) On the Closing Date, the Preferred Member shall make the Preferred Contribution, and
shall receive the number of Preferred Units, set forth opposite the Preferred Member's name on Schedule A representing 100%
of the Preferred Units.

 

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(b)    
Subject to the provisions of this Article 3, the Preferred Member may from time to time make additional capital contributions to
the Company for use for any purposes set forth in this Agreement, to the extent that the Manager has requested additional capital
contributions from the Common Members and less than all of the Common Members participate as to their proportionate share; provided
that such capital contributions represent consideration for the issuance of Preferred Units. The Manager shall amend Schedule
A to reflect such additional Preferred Units set forth opposite the Preferred Member's name and shall deliver a copy of such
revised Schedule A to the Preferred Member and all other Members.

 

Section
3.04.  Ranking of Preferred Interests. (a) The holders of Preferred Units shall rank in preference or priority to
the holders of all other Units as to the payment of distributions
and redemptions and as to the distribution of assets upon liquidation, dissolution or winding up of the Company as set forth in
this Agreement.

 

(b)     The
Company shall not authorize, create or issue any Units that shall be deemed Senior Securities or Parity Securities. For this purpose,
"Senior Securities" means any Units ranking prior to the Preferred Units, as to the payment of distributions and
redemptions and as to the distribution of assets upon liquidation, dissolution or winding up of the Company, if the holders of
such Units shall be entitled to the receipt of distributions or redemptions or amounts distributable upon liquidation, dissolution
or winding up of the Company, as the case may be, in preference or priority to the holders of Preferred Units. For this purpose,
''Parity Securities" means any Units on a parity with the Preferred Units, as to the payment of distributions and redemptions
and as to the distribution of assets upon liquidation, dissolution or winding up of the Company, whether or not the distribution
rates, distribution payment dates or redemption payment dates or liquidation prices thereof be different from those of the Preferred
Units, if the holders of such Units and the Preferred Units shall be entitled to the receipt of distributions and redemptions and
of amounts distributable upon liquidation, dissolution or winding up of the Company in proportion
to their respective amounts of accrued and unpaid distributions per Unit or liquidation preferences, without preference or priority
one over the other.

 

ARTICLE 4

 

PREFERRED UNITS

 

Section
4.01.  Mandatory Monthly Distributions. (a) The holders of Preferred Units shall, subject to any restrictive terms
of the Mortgage Loan Documents, be entitled to receive on each Preferred Payment Date, pro-rata among such holders in accordance
with their respective Preferred Percentage Interests, a monthly cash distribution (a "Preferred Monthly Distribution")
for each Distribution Period which shall accrue on the Unreturned Preferred Contribution as of the commencement of the applicable
Distribution Period at a rate equal to the Preferred Return Rate (calculated on the basis of a 360-day year and the number of days
in such Distribution Period), which Preferred Monthly Distribution shall be paid from cash flow or Net Proceeds available for distribution
pursuant to Section 4.03(b)(v). If permitted pursuant to the terms of the Mortgage Loan Documents, such Preferred Monthly
Distribution shall be payable in arrears on each Preferred Payment Date commencing on June 15, 2013. Any distributions not payable
due to any restrictions in the Mortgage Loan Documents shall remain due and payable and shall be paid promptly payable upon the
removal of any such restrictions.

 

(b)
Distributions on the Preferred Units shall be cumulative from the date of issue, and shall accrue whether or not funds of the Company
are legally available for the payment of such distributions and, to the extent unpaid, shall accrue at the Preferred Return Rate
in accordance with Section 4.0l (a). Distributions shall be payable to the Preferred Member identified on Schedule A
or to any Preferred Member Transferee of which the Manager has written notice prior to any Preferred Payment Date in accordance
with the terms hereof.

 

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(c) Except
as otherwise expressly provided in this Agreement, the Preferred Member shall not be entitled to any distributions (other than
the liquidation distributions under Section 4.02
and redemptions under Section 4.03), whether payable in cash, property or stock,
in excess of the cumulative distributions provided in this Section 4.0 l . Except as otherwise expressly provided in this
Agreement (including as provided in Section 4.0 l(b)), no other interest or sum of money in lieu of interest shall be payable
in respect of any distribution payment on the Preferred Units that may be in arrears.

 

(d)
 So long as any Preferred Units are outstanding, the Company shall not declare, pay or set apart for payment any distributions on
any Junior Securities (other than distributions paid in Junior Securities, or options, warrants or other rights exercisable into,
exchangeable for or convertible solely into Junior Securities) or make any mandatory or optional redemption, sinking fund or other
similar payment in respect of, or otherwise acquire any Junior Securities (any such distributions, redemptions, other payments
or other acquisitions being a ''Junior Securities Distribution") for any consideration, except by exercise into, exchange
for or conversion into Junior Securities, unless in each case, (i) the full cumulative distributions have been paid or are contemporaneously
declared and paid in cash, or are declared and a cash amount sufficient for the payment thereof has been set apart for such payment,
on the entire Unreturned Preferred Contribution for all Distribution Periods terminating on or before the date of payment
of such Junior Securities Distribution; and (ii) such Junior Securities Distribution in respect of
any Distribution Period are no greater than the amount of Net Cash Flow in respect of such Distribution Period. Notwithstanding
anything to the contrary contained in this Agreement, no Junior Securities Distribution of any kind shall be made at any time following
the occurrence of, and, to the extent the same may be cured thereafter, during the continuance of, any Trigger Event.

 

As
used herein, "Net Cash Flow" means all cash distributed to the Company by the Property Owner, after any reasonable reserves
held back by the Manager; provided that Net Cash Flow shall not include any proceeds from the sale of assets described in
Section 4.03(b)(i)(B).

 

Section
4.02.  Liquidation Preference. (a) Upon the liquidation, dissolution or winding-up of the Company, whether voluntary
or involuntary, before any payment or distribution of the Company's assets (whether capital or surplus) shall be made to or set
apart for the holders of any Junior Securities, the holders of Preferred Units shall be entitled to receive, and the Company shall
pay to such holders pro-rata in accordance with their respective Preferred Percentage Interests, an amount equal to the
Total Redemption Amount. If, upon the liquidation, dissolution or winding-up of the Company, the Company's assets, or proceeds
thereof, distributable to the holders of Preferred Units are insufficient to pay in full the Total Redemption Amount, then such
assets, or the proceeds thereof, shall be distributed among the holders of Preferred Units ratably in proportion to their respective
Preferred Percentage Interests in the order set forth in Section 4.03(b)(v) below.

 

(b)
For purposes of Section 4.02(a), notwithstanding anything else in this Agreement, a liquidation, dissolution or winding
up of the Company, whether voluntary or involuntary, shall be deemed to have occurred upon:

 

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(i)
a sale, conveyance, exchange or transfer (for cash, shares of stock, securities or other consideration) of all or substantially
all of the assets of the Property Owner (whether in a single transaction or in a series of related or substantially contemporaneous
transactions, and including any such sale pursuant to Section 10.03(b));

 

(ii)
any merger, share purchase or sale, reorganization, consolidation or other business combination involving the Company (whether
in a single transaction or in a series of related or substantially contemporaneous transactions) in which, as a result of such
merger, share purchase or sale, reorganization, consolidation or other business combination, the holders of Common Units as of
the date hereof possess less than a majority of Common Units after such transaction;

 

(iii) at
any time that the Manager as of the date hereof, or another Affiliate of Bluerock, ceases to control the day-to-day operations
of the Company; or

 

(iv) any
financing, refinancing or prepayment in whole or in part of the Mortgage Debt (unless all of the outstanding Preferred Units are
redeemed in connection with such financing, refinancing or prepayment) other than as provided in Section 4.03(b)(i)(D) below.

 

Any
liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, and any event described in clauses
(i), (ii), (iii) and (iv) of this Section 4.02(b), is referred to herein as a "Liquidation
Event".

 

(c)
After the Total Redemption Amount has been paid on all outstanding shares of Preferred Units, as
provided in this Section 4.02,
the holders of Junior Securities shall be entitled to receive any and
all assets remaining to be paid or distributed in accordance with Section 12.04(c) and
any other terms and conditions applicable to the Junior
Securities, and holders of Preferred Units shall not be entitled to share therein.

 

Section 4.03.  Redemption.

 

(a)     Redemption
at the Option of the Company. The Company may, at its option, to the extent the Company has funds lega.lly available for
such purpose, redeem the outstanding Preferred Units, at any time, in whole or in part, for a redemption price with respect to
each Preferred Unit equal to the Liquidation Preference for such Preferred Unit, (with any fractional Preferred Units being rounded
down to the nearest whole Preferred Unit) (any such redemption, a "Company Optional Redemption"). All such amounts
shall be made pro-rata among the parties constituting Preferred Member in accordance with their respective Preferred Percentage
Interests and distributed in the order set forth in Section 4.03(b)(v) below.

 

(b)     Mandatory
Redemption. (i) In the event of (A) any sale of (1) Junior Securities or (2) Senior Securities or Parity Securities in
violation of the provisions of Section 3.04(b), in each case by the Company for cash, (B) any sale of assets by the Company
or its Subsidiaries (including any such sale pursuant to Section 10.03(b)) for cash, (C) any sale of the Property by the
Property Owner, (D) any financing or refinancing by the Property Owner (other than the refinancing of the $10,000,000 Key Bank
Mortgage Loan) of any assets of the Company or its Subsidiaries, or (E) the occurrence of a Casualty or Condemnation to the extent
that any Insurance Proceeds, Condemnation Proceeds and/or title insurance proceeds are not applied to the restoration of any of
the Property pursuant to the provisions of the Mortgage Loan Documents and are instead ratably
distributed by the Property Owner to the Company (each of clauses (A), (B), (C), (D), and (E),
a "Covered Sale"), the Company shall, immediately upon the completion of such Covered Sale, redeem the number
of Preferred Units determined pursuant to Section 4.03(b)(iii).

 

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(ii)        
If a Trigger Event occurs, in addition to the other rights and remedies available to the Preferred Member hereunder, the Preferred
Member shall have the right, but not the obligation, to give written notice to the Manager requiring the Company to immediately
redeem in cash all of the Preferred Units at a redemption price equal to the Total Redemption Amount.

 

(iii)        The
Preferred Units to be redeemed in respect of any Covered Sale or Trigger Event shall be determined as follows:

 

(A)
if at such time Preferred Units are held by more than one Preferred Member, the total number of Preferred Units of each Preferred
Member to be redeemed shall equal the quotient of (x) the Net Proceeds of such Covered Sale, divided by (y) the Liquidation
Preference per Preferred Unit, with any fractional Preferred Units being rounded down to the nearest whole Preferred Unit; and

 

(B)
any redemption pursuant to Section 4.03(b)(iii)(A) above shall be made pro-rata among the parties constituting the
Preferred Member in accordance with their respective Preferred Percentage Interests.

 

(iv)        Notwithstanding
the foregoing, the Company shall not be required to redeem Preferred Units pursuant to this Section 4.03(b) from additional
capital contributions made pursuant to Section 3.02(b).

 

(v)         As
used herein, "Net Proceeds" means the net proceeds to the Company resulting from (A) the applicable sale of Junior
Securities, Senior Securities, Parity Securities or assets (including, without limitation, the Property), and (B) all Insurance
Proceeds, Condemnation Proceeds, Awards and title insurance proceeds, in each case following the payment of all actual out-of-pocket
Third Party costs and expenses incurred by the Company in connection with such Covered Sale and the payment of the Mortgage Debt,
and (C) all Net Sales Proceeds. All Net Proceeds, and the Liquidation Preference payable in connection with any Company Optional
Redemption, shall be applied and distributed to the maximum extent permitted by law, in the following order:

 

(1)         first,
to the parties constituting the Preferred Member pro-rata in accordance with their respective Preferred Percentage Interests,
until all accrued but unpaid Preferred Return, through and including the end of the applicable Distribution Period in which such
payment occurs, has been paid in full;

 

(2)         second,
to the parties constituting the Preferred Member pro-rata in accordance with their respective Preferred Percentage Interests,
until the Unreturned Preferred Contribution has been reduced to zero;

 

(3)         third,
the balance, if any, to the holders of Junior Securities.

 

(c)          If
and so long as any obligation of the Company to redeem any Preferred Units pursuant to Section 4.03(b) is not fully discharged,
the Company shall not, and shall cause its Subsidiaries not to, directly or indirectly, declare or make any Junior Securities Distribution.

 

(d)          A
holder of Preferred Units shall cease to be a Member once all of such holder's Preferred Units have been redeemed by the Company
in accordance with this Agreement.

 

 

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Section 4.04.   Redemption Procedures.

 

(a)
If less than the entire Unreturned Preferred Contribution is to be redeemed pursuant to Section 4.03(a), the total number
of Preferred Units held by each Preferred Member to be redeemed shall be determined by the Manager and such total number of Preferred
Units shall be redeemed ratably among the parties constituting the Preferred Member in accordance with their respective Preferred
Percentage Interests (with any fractional Preferred Units being rounded down to the nearest whole Preferred Unit).

 

(b)
If the Company proposes to redeem any Preferred Units pursuant to Section 4.03(a) or Section 4.03(b), the Company
shall deliver to each holder of Preferred Units irrevocable written notice of such redemption five Business Days before the applicable
redemption date (which notice may be waived by such Preferred Member). Each such notice shall state: (i) the redemption date; (ii)
if fewer than all the Preferred Units are to be redeemed, the number of Preferred Units to be redeemed from such Preferred Member;
(iii) the redemption price for each Preferred Unit; and (iv) that distributions on the Preferred Units to be redeemed will cease
to accrue on the date of redemption.

 

ARTICLE 5

 

ALLOCATIONS

 

Section
5.01.  Net Profit. Subject to Section 5.03,
Net Profit for any fiscal year or other period shall be allocated as of the last day of such fiscal year or other
period in the following order and priority:

 

(a)    
First, if Net Loss has been allocated pursuant to Section 5.02(b) in respect of any prior fiscal years or
other periods, Net Profit shall be allocated to the Preferred Member in a manner that will reverse, on a cumulative basis, the
effect of such prior Net Loss allocations to such Members.

 

(b)   
Second, if Net Loss has been allocated pursuant to Section 5.02(a) in respect of any prior fiscal years or
other periods, Net Profit shall be allocated to the Common Members in a manner that will reverse, on a cumulative basis, the effect
of such prior Net Loss allocations to such Members.

 

(c)    
Third, any remaining Net Profit shall be allocated to the parties constituting Preferred Member in accordance with
their respective Preferred Percentage Interests, to the extent of the Unallocated Preferred Return of the Preferred Units.

 

(d)     Fourth,
any remaining Net Profit shall be allocated to the Common Members in accordance with their respective Common Percentage Interests.

 

Section 5.02.   Net Loss.

 

(a)          First,
subject to Section 5.03, Net Loss shall be allocated to the Common Members in accordance with, and to the extent of,
their respective positive Capital Account balances.

 

(b)          Second,
any remaining Net Loss shall be allocated to the Preferred Member in accordance with, and to the extent of, its positive Capital
Account balances.

 

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(c)          Third,
any remaining Net Loss shall be allocated to the Common Members in accordance with their respective Common Percentage Interests.

 

Section 5.03.  
Allocations in Specified Circumstances. Notwithstanding anything else in Sections 5.01 or 5.02, in
the event of a redemption of all outstanding Preferred Units at a price in excess of the Total
Redemption Amount, prior to any allocation of Net Profit to the Common Members in the fiscal year or other period in which such
redemption occurs, the parties constituting Preferred Members shall be allocated, in accordance with their respective Preferred
Percentage Interests, an amount of Net Profits equal to such excess.

 

Section
5.04. Tax Allocations. (a) Except as otherwise required by the Code or the Regulations, all items of Company income,
gain, loss, expense, deduction and any other items shall be allocated among the Members for federal income tax purposes in the
same proportions as they share the corresponding items pursuant to this Article 5.

 

(b)
Any elections or other decisions relating to allocations pursuant to this Section 5.04 shall be made by the Tax Matters Partner,
in any manner that reasonably reflects the purpose and intention of this Agreement. Allocations pursuant to this Section 5.04
are solely for purposes of federal, state, and local taxes and shall not affect, or in any way be taken into account in computing,
any Member's share of book income, gain, loss, expense, deduction, other items, or distributions pursuant to any provision of this
Agreement.

 

ARTICLE 6

 

OTHER DISTRIBUTIONS

 

Section
6.01.  Distributions. (a) To the extent not prohibited by Article 4 and so long as (i) no Monthly Distribution
Shortfall has occurred and is continuing, (ii) no Trigger Event has occurred and, to the extent the same may be capable of cure,
is continuing, and (iii) all distributions required pursuant to Section 4.02 and Section 4.03(b) following any Liquidation
Event or Covered Sale have been fully paid by the Company then, distributions on the Common Units out of funds legally available
for any such distribution and after first taking into account any reasonable reserves as reasonably determined by the Manager,
shall be paid by the Company to the Common Members in accordance with the irrespective Common Percentage Interests.

 

(b)
Notwithstanding any provision of this Agreement to the contrary, the Company shall not make a distribution to any Member on account
of its Interest if such distribution would violate Section 18-607 of the Delaware Act or other applicable law; provided,
however, that the foregoing shall, to the fullest extent permitted by law, not affect or in any way be taken to relieve
the Company of its obligation to make distributions to the Preferred Member in accordance with the terms of this Agreement or be
deemed to waive any resulting Trigger Event.

 

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Section
6.02. Authority to Withhold; Treatment of Withheld Tax. Notwithstanding any other provision of this Agreement, each
Member hereby authorizes the Company to withhold and to pay over, or otherwise pay, any withholding or other taxes payable by
the Company or any of its Affiliates (pursuant to the Code or any provision of United States federal, state or local or non-U.S.
tax law) with respect to such Member or as a result of such Member's participation in the Company. If and to the extent that the
Company shall be required to withhold or pay any such withholding or other taxes, such Member shall be deemed for all purposes
of this Agreement to have received a payment or distribution from the Company as of the time such withholding or other tax is
required to be paid. To the extent that the aggregate of such payments to a Member for any period exceeds the distributions that
such Member would have received for such period but for such withholding, the Manager shall notify such Member as to the amount
of such excess and such Member shall make a prompt payment to the Company of such amount by wire transfer. Any withholdings by
the Company referred to in this Section 6.02 shall be made at the maximum applicable statutory rate under the applicable
tax law unless the Manager shall have received an opinion of counsel or other evidence, satisfactory to the Manager, to the effect
that a lower rate is applicable, or that no withholding is applicable. Any and all payments under this Section 6.02 shall
be treated as a distribution for purposes of this Agreement.

 

Section
6.03. Dissolution. Upon dissolution and winding up of the Company, the Company shall make distributions in accordance
with Section 12.04.

 

ARTICLE
7

 

MANAGEMENT
OF COMPANY

 

 Section
7.01.     Management.

 

(a)          Manager.
The Company shall have one manager (the "Manager") within the meaning of the Delaware Act. Until replaced as provided
herein, the Manager shall hold office until a successor is elected and qualified or until its resignation or, subject to Section
7.01(e), removal. Subject to Section 7.06, the business, property and affairs of the Company shall be managed solely
by or under the direction of the Manager, as and to the extent set forth in this Section 7.01. The initial Manager is Bluerock.
The Manager is a "manager" within the meaning of Section 18-101(10) of the Delaware Act.

 

(b)          Powers.
Subject to Section 7.02, the Manager shall have the power to do any and all acts necessary, convenient or incidental
to or for the furtherance of the purposes set forth in Section 2.03. Subject to Section 7.02, the Manager has the
authority to bind the Company.

 

(c)          Meetings
of the Company. The Company may hold meetings, both regular and special, within or outside the State of Delaware. Meetings
of the Company may be called by the Manager or any Member on not less than five business days' notice to the Company. The notice
requirement may be waived if the Manager and the parties constituting the Preferred Member holding a majority of the outstanding
Preferred Units participate in the meeting and agree to waive the notice with respect to that meeting. Any action required or
permitted to be taken at any meeting of the Company may be taken without a meeting if the Manager and, if such action requires
the approval of the Preferred Member, the parties constituting the Preferred Member holding a majority of the outstanding Preferred
Units, consent to that action in writing, and the writing or writings are filed with the minutes of proceedings of the Company.

 

(d)          Electronic
Communications. The Company may hold meetings by means of telephone conference or similar communications equipment that allows
all persons participating in the meeting to hear each other, and participation in a meeting in this fashion shall constitute presence
in person at the meeting. If all the participants are participating by telephone conference or similar communications equipment,
the meeting shall be deemed to be held at the principal place of business of the Company.

 

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(e)          Removal
of Manager. The Manager may be removed at any time by Common Members holding at least seventy-five percent (75%) of the outstanding
Common Units, but only for the Manager's fraud or gross negligence with respect to the Property, and any vacancy caused by any
such removal may be filled only by Common Members holding a majority of the outstanding Common Units; provided, however,
that so long as any obligation under the Mortgage Loan remains outstanding and not discharged in full, consent of the Mortgage
Lender shall also be required for removal of a Manager and appointment of a successor Manager; provided, further, that
so long as any Preferred Units remain outstanding, consent of a majority of the Preferred Units shall also be required for removal
of a Manager and appointment of a successor Manager.

  

(f)          Manager
as Agent. To the extent of its powers set forth in this Agreement and subject to Section 7.02, the Manager is an agent
of the Company for the purpose of the Company's business, and any actions of the Manager that are taken in accordance with the
provisions set forth in this Agreement shall bind the Company.

 

Section
7.02. Approval Rights. (a) Notwithstanding anything that may be deemed to be to the contrary in this Agreement,
except as otherwise permitted by this Agreement, so long as any Preferred Units are outstanding, the Manager and the Company shall
not take, or agree or commit to take, directly, or indirectly through the Property Owner or otherwise, any of the following actions
without the approval of the Preferred Member:

 

(i)          Sale
of Assets. Sell, assign, transfer, lease or otherwise dispose of (A) any portion or all of the Property (other than a sale
of the Property in accordance with the Mortgage Loan Documents provided that the Net Sales Proceeds are distributed
to the Company); or (B) any other material assets of the Company (other than ordinary course replacements), in one transaction
or a series of related transactions.

 

(ii)         Issuances
of Limited Liability Company Interests. Issue any limited liability company interests in the Company other than the Common
Units and the Preferred Units, or issue any Senior Securities or Parity Securities in violation of the provisions of Section
3.04(b), or make any additional capital calls with respect to the Preferred Units.

 

(iii)        Debt.
Incur, assume, guarantee, or otherwise become, directly or indirectly, liable with respect to, any Indebtedness other than
(A) the Mortgage Debt evidenced by the Mortgage Loan Documents; and (B) trade payables incurred in the ordinary course of its
business, provided that such debt (1) is not evidenced by a note, (2) is paid within sixty (60) days of the date
an invoice is submitted for payment thereof or such earlier date required for payment pursuant to such invoice (unless such invoice
is being contested in good faith and in a commercially reasonable manner, in which case such sum shall be paid promptly upon a
determination that such sum is due), (3) with respect to the Company, does not exceed in the aggregate $25,000, and (4) is payable
to trade creditors and in amounts as are normal and reasonable under the circumstances.

 

(iv)       Liens
on Property. Intentionally create, incur, assume or suffer to exist, or permit or cause any of its Subsidiaries to create,
incur, assume or suffer to exist, any Lien on any portion of the Property, except as permitted under the Mortgage Loan Documents.

 

(v)        Financing
or Refinancing of Mortgage Debt. Any financing, refinancing or prepayment of the Mortgage Debt, unless the Preferred Units
shall have been (or shall simultaneously be) redeemed in full in accordance with the terms of this Agreement.

 

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(vi)        Merger
or Consolidation. Merge, reorganize or consolidate the Company or any of its Subsidiaries (whether in a single transaction
or in a series of related or substantially contemporaneous transactions) with or into another Person (or engage in any other transaction
having substantially the same effect), or acquire, either directly or indirectly, the equity interests in another Person.

 

(vii)       Bankruptcy.
Commence any bankruptcy or insolvency proceeding, acquiesce to the appointment of a receiver, trustee, custodian or liquidator
or admit the material allegations of a petition filed against the Company in any bankruptcy proceeding.

 

(viii)      Transaction
with Affiliates. Except as otherwise permitted by this Agreement or in connection with a bona fide management compensation
arrangement of the Company, enter into any material transactions with the Manager (acting other than in its capacity as manager
of the Company), or any of its Affiliates, except for (A) the Property Management Agreement with the Property Manager and (B)
any transaction which is substantially on the terms and conditions then prevailing in the market for such type of transactions.

 

(ix)         Tax
Matters. Take any material election or action by the Tax Matters Partner pursuant to Section 8.03.

 

(x)          Amendments
To Charter Documents. Terminate, amend or modify the legal structure of the Company and/or the single purpose nature and bankruptcy
remoteness of the Company in violation of the provisions of Section 7.05 and Section 9.01 and/or the Company's certificate
of formation, operating agreement and other charter documents, except to provide for any administrative or ministerial changes
that could not adversely affect any Preferred Member; provided that written notice of any such administrative or ministerial
change shall be promptly delivered to the Preferred Member.

 

(xi)         Material
Amendments to Mortgage Loan Documents. (A) Amend, modify, supplement or waive any terms or provisions of any of the Mortgage
Loan Documents in any material respect or to the extent any such amendment, modification, supplement or waiver would, whether
or not material, reasonably be expected to adversely affect any Preferred Member, or (B) request from the Mortgage Lender any
waiver of any of the terms or provisions of its applicable Mortgage Loan Documents.

 

(xii)        Material
Agreements Affecting Property. Enter into any new material contract or agreement, or materially amend or modify any existing
contract or agreement that is binding on the Company or Manager with respect to or affecting the Property.

 

(xiii)       Amendments
to and Actions under Property Management Agreement. (A) Amend, modify or supplement any terms or provisions of the Property
Management Agreement in any material respect, or rescind or terminate the Property Management Agreement, or enter into any replacement
Property Management Agreement, or (B) take any action under the Property Management Agreement that is inconsistent with the terms
of this Agreement.

 

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(b)   
With respect to the approval of any proposed action to be taken pursuant to Section 7.02(a) above, the Manager shall
send to the Preferred Member a notice setting forth in reasonable detail the terms of each such proposed action and a written
request for approval thereof. If the Preferred Member shall fail to approve or reject the proposed action within five (5)
Business Days after receipt of such written request from the Manager, the proposed action shall be deemed to have been
approved by the Preferred Member.

 

Section
7.03. Officers. The Manager may, from time to time as it deems advisable, select natural persons who are employees
or agents of Bluerock or its Affiliates or of the Company and designate them as officers of the Company and assign titles to any
such person. Unless the Manager decides otherwise, if the title is one commonly used for officers of a business corporation formed
under the Delaware General Corporation Law, the assignment of such title shall constitute the delegation to such person of the
authorities and duties that are normally associated with that office. Any delegation pursuant to this Section 7.03 may
be revoked at any time by the Manager. Any officer of the Company may be removed with or without cause by the Manager.

 

Section
7.04. Lack of Authority. No Member in its capacity as such has the authority or power to act for or on behalf of
the Company in any manner, to do any act that would be (or could be construed as) binding on the Company or to make any expenditures
on behalf of the Company, unless such specific authority has been expressly granted to such Member by the Manager.

 

Section
7.05. Limitations on the Company's Activities. (a) This Section 7.05 is being adopted in order to comply
with certain provisions required in order to qualify the Company as a "special purpose entity".

 

(b)
Notwithstanding anything to the contrary in this Agreement or in any other document governing the formation, management or operation
of the Company, neither the Manager nor the Company shall amend, alter or change any of Sections 2.03, 2.04, 2.08
and 3.04, Article 4, Section 7.01(a), (e), and (f), Section 7.02, this Section
7.05, Section 9.01, Article 10, Section 11.01, Sections 12.01, 12.02, 12.03,
12.04, 13.02 and 13.06 (the "Special Purpose Provisions"), without the written consent of
the Mortgage Lender and the Preferred Member. Subject to this Section 7.05 and Section 7.02, the Manager reserves
the right to amend, alter, change or repeal any provisions contained in this Agreement in accordance with Section 13.02.
In the event of any conflict between any of the Special Purpose Provisions and any other provision of this or any other document
governing the formation, management or operation of the Company, the Special Purpose Provisions shall control.

 

(c)          Notwithstanding
any other provision of this Agreement and any provision of law that otherwise so empowers the Company, any Common Member, the
Manager, any officer or any other Person, neither the Company nor the Common Members nor the Manager nor any other Person shall
be authorized or empowered, nor shall they permit the Company to, and the Company shall not, without the prior unanimous written
consent of the Preferred Member, the Manager and the Mortgage Lender, take any Material Action. Notwithstanding anything to the
contrary in this Agreement or in any other document governing the formation, management or operation of the Company, prior to
taking any Material Action, the Members and the Manager shall, to the fullest extent permitted by law, including Section 18-l101(c)
of the Delaware Act, take into account the interest of the Company's creditors, as well as those of the Company.

 

(d)          The
Manager shall cause the Company to do or cause to be done all things necessary to preserve and keep in full 'force and effect
its existence, rights (charter and statutory) and franchises; provided, however, that the Company shall not be required
to preserve any such right or franchise if the Manager shall determine that the preservation thereof is no longer desirable for
the conduct of its business and that the loss thereof is not disadvantageous in any material respect to the Company.

 

    	21

    	 

    

  

(e)          The
Manager also shall cause the Company to and the Company shall comply with all the requirements set forth in Section 9.01
hereof.

 

ARTICLE
8

 

TAX
AND ACCOUNTING MATTERS;

BOOKS
AND RECORDS

 

Section
8.01. Fiscal Year. The fiscal year of the Company (the "Fiscal Year") shall begin on January 1
(except for the first Fiscal Year, which began on the Effective Date) and end on December 31 of each year.

 

Section
8.02. Partnership for Tax Purposes. Unless otherwise required by applicable law, the Members hereby agree that the
Company shall be treated as a partnership for tax purposes under U.S. federal, state and local income tax laws or other laws,
and further agree not to take any position or any action or to make any election, in a tax return or otherwise, inconsistent herewith.

 

Section
8.03. Tax Matters. (a) The tax matters partner (the "Tax Matters Partner") for purposes of Section
6231 of the Code shall be the Manager.

 

(b)          All
necessary tax information (including all tax returns of the Company, together with any schedules or other information which each
Member may require) shall be delivered to each Member as promptly as is practicable after the end of each Fiscal Year of the Company.

 

(c)          All
elections by the Company for income and franchise tax purposes and all determinations for tax purposes regarding the fair market
value of any Company assets, book basis, depreciation or amortization and all other matters relating to all tax returns (including
amended returns) filed by the Company, including tax audits and related matters and controversies, shall be made and conducted
by the Tax Matters Partner. The Tax Matters Partner shall, at the expense of the Company, cause to be prepared and filed all tax
returns (including amended returns) required to be filed by the Company. The Tax Matters Partner shall provide notice to the Members
of any audit or other administrative proceeding being conducted by a taxing authority.

 

Section
8.04. Books and Records. The Company shall keep, or cause to be kept, appropriate books and records with respect
to the Company's business. The Company shall further provide the Common Members with reports consistent with the reports previously
provided to the Common Members as beneficial members under the DST.

 

Section
8.05. Annual Budgets. For the partial year period commencing on the date hereof, and for each Fiscal Year thereafter,
the Company shall deliver to the Members the Property Owner's annual budget, not later than sixty (60) days prior to the commencement
of such period or Fiscal Year (each such annual budget, an "Annual Budget").

 

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ARTICLE
9

 

CERTAIN
COVENANTS

 

Section
9.01.   Single Purpose Entity.         So
long as any Mortgage Loan is outstanding and except for any transaction contemplated in this Agreement or in the Mortgage Loan
Documents, the Manager shall not cause the Company to, and the Company shall not:

 

(a)          engage
in any business or activity other than the ownership and management of the Company's ownership interests in the Property Owner
and business activities incidental thereto, and entering into this Agreement and activities incidental thereto;

 

(b)          acquire
or own any material assets other than the Company's ownership interests in the Property Owner;

 

(c)           merge
into or consolidate with any Person or, to the fullest extent permitted by applicable law, dissolve, terminate or, to the fullest
extent permitted by applicable law, liquidate in whole or in part, transfer or otherwise dispose of all or substantially all of
its assets, change its legal structure, or engage in any other business activity;

 

(d)          (i)
fail to observe its organizational formalities or preserve its existence as an entity duly organized, validly existing and in
good standing (if applicable) under the laws of the jurisdiction of its organization or formation, or (ii) amend, modify, terminate
or fail to comply with the Special Purpose Provisions of this Agreement, and/or of the Company's articles of organization or similar
organizational documents, as the case may be (except as required by applicable law);

 

(e)           other
than the Company's ownership interests in the Property Owner, own any Subsidiary or make any investment in, any other Person without
the prior written consent of the Mortgage Lender or the Preferred Member, which consent shall not be unreasonably denied, withheld,
conditioned or delayed;

 

(f)           other than as may be permitted or required by the Mortgage Loan Documents, commingle its assets with the assets of any of its
members, managing members, general partners, Affiliates, principals or of any other Person, participate in a cash management system
with any other Person, or fail to use its own separate stationery, invoices and checks;

 

(g)          incur
any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than (i) the Mortgage Debt;
(ii) [intentionally deleted], and (iii) trade payables incurred in the ordinary course of its business, provided that such debt
(A) is not evidenced by a note, (B) is paid within sixty (60) days of the date an invoice is submitted for payment thereof or
such earlier date required for payment pursuant to such invoice (unless such invoice is being contested in good faith and in a
commercially reasonable manner, in which case such sum shall be paid promptly upon a determination that such sum is due), (C)
does not exceed in the aggregate $50,000, and (D) is payable to trade creditors and in amounts as are normal and reasonable under
the circumstances;

 

    	23

    	 

    

 

(h)          to
the extent of then available distributions from the Property Owner, fail, at any time (i) to 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 (ii) to remain solvent and to pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses)
from its assets as the same have or shall become due, and to 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;

 

(i)           (i)
fail to maintain its records (including financial statements), books of account and bank accounts separate and apart from
those of the members, managing members, general partners, principals and Affiliates of the Company, the Affiliates of a
member, managing member, general partner or principal of the Company and any other Person; (ii) permit its assets or
liabilities to be listed as assets or liabilities on the financial statement of any other Person; or (iii) include the assets
or liabilities of any other Person on its financial statements, provided, however, the Company's assets may be
included in a consolidated financial statement of its Affiliates provided that appropriate notations shall be made on such
consolidated financial statement to indicate the separateness of the Company and its Affiliates and to indicate that none of
any such Affiliate's assets and credit are available to satisfy the debts and other obligations of the Company;

 

(j)          
other than the Property Management Agreement, enter into any contract or agreement with any member, managing member, general partner,
principal or Affiliate of the Company, or any member, managing member, general partner, principal or Affiliate thereof, except
upon terms and conditions that are commercially reasonable, intrinsically fair and substantially similar to those that would be
available on an arm's length basis with third parties other than any member, managing member, general partner, principal or Affiliate
of the Company, or any member, managing member, general partner, principal or Affiliate thereof;

 

(k)           fail
to refrain, to the fullest extent permitted by applicable law, from seeking the dissolution or winding up in whole, or in part,
of the Company;

 

(l)            fail
to correct any known misunderstandings regarding the separate identity of the Company or any member, managing member, general
partner, principal or Affiliate thereof or any other Person;

 

(m)          guarantee
or become obligated for the debts of any other Person or hold itself out to be responsible for the debts of another Person;

 

(n)          make
any loans or advances to any Third Party, including any member, managing member, general partner, principal or Affiliate of the
Company or any member, managing member, general partner, principal or Affiliate thereof, and shall not acquire obligations or
securities of any member, managing member, general partner, principal or Affiliate of the Company or any member, managing member,
general partner, or Affiliate thereof;

 

(o)           fail
to file its own tax returns or be included on the tax returns of any other Person except as required or permitted by applicable
law;

 

    	24

    	 

    

  

(p)          fail
either to hold itself out to the public as a legal entity separate and distinct from any other Person or to conduct its business
solely in its own name or a name franchised or licensed to it by an entity other than an Affiliate of the Company and not as a
division or part of any other entity in order not (i) to mislead others as to the identity with which such other party is transacting
business, or (ii) to suggest that the Company is responsible for the debts of any Third Party (including any member, managing
member, general partner, principal or Affiliate of the Company or any member, managing member, general partner, principal or Affiliate
thereof);

 

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

 

(r)           share
any common logo with or hold itself out as or be considered as a department or division of (i) any general partner, principal,
managing member, member or Affiliate of the Company, (ii) any Affiliate of a general partner, principal, managing member or member
of the Company, or (iii) any other Person

 

(s)           pledge
its assets for the benefit of any other Person;

 

(t)           fail
to maintain a sufficient number of employees in light of its contemplated business operations taking into account the services
to be provided by the Manager pursuant to this Agreement;

 

(u)          fail
to hold its assets in its own name;

 

(v)          have
any of its obligations guaranteed by an Affiliate; and

 

(w)          identify,
at any time, its partners, members or shareholders, or any Affiliate of any of them, as a division or part of it, and has not
identified itself, and shall not identify itself, as a division of any other Person.

 

ARTICLE
10

 

DISPOSITION OF UNITS;

TRIGGER
EVENTS AND CONSEQUENCES

 

Section
10.01.     Transfers. (a) Subject to compliance with the terms and conditions of this Agreement (including, without
limitation, Sections 4.02 and 4.03(b)) and the provisions of the Mortgage Loan Documents, any Common Member may
freely Transfer any or all of its Common Units, so long as such Transfer is not to a Prohibited Person (each, a "Permitted
Transfer"). Upon request from the Preferred Member, the Manager shall promptly deliver to the Preferred Member an updated
organizational chart showing the ultimate beneficial owners in the Company, together with all intervening entities and corresponding
ownership percentages.

 

(b)          Notwithstanding
anything to the contrary herein, the Preferred Member shall have the right to Transfer all or any portion of its Preferred Units
to any Person without restriction or consent of the Company, the Manager or any other Member; provided, that (A) such Transfer
shall not cause a default under the Mortgage Loan Documents, and (B) the Preferred Member shall, as a condition to any such Transfer,
be solely responsible for all costs of any such Transfer.

 

(c)          Any
Transfer of all or any portion of the Units which is not made in compliance with the provisions of this Agreement shall, to the
fullest extent permitted by law, be void, and the Company shall not recognize any such Transfer. Notwithstanding anything else
contained herein, no Transfer shall be made except in compliance with all applicable laws, including the Securities Act of 1933,
as amended. No transferee shall be admitted to the Company as a Member unless the Transfer was permitted under this Agreement.

 

    	25

    	 

    

 

 (d)        If
(i) Units are Transferred in accordance with the terms of this Agreement and (ii) the transferee is to be admitted to the Company
as a Member, the following shall apply:

 

(A)       the
transferee shall execute and deliver to the Company such instruments (including a counterpart of this Agreement), in form and
substance reasonably satisfactory to the Manager, as the Manager shall reasonably deem necessary or desirable to confirm the agreement
of such transferee to be bound by all the terms and provisions of this Agreement (as it may be amended in connection with the
admission of such transferee as a Member);

 

(B)        upon
execution of such instruments, the transferee shall be admitted to the Company as a Member of the Company;

 

(C)        immediately
following the admission of the transferee to the Company as a Member of the Company, any Member who has thereby transferred all
of its Units shall cease to be a Member of the Company;

 

(D)       the transferee, as a Member of the Company, and any other Members are hereby authorized to, and shall, continue the business of
the Company without dissolution; and

 

(E)        any transferee who is admitted to the Company as a Member shall succeed to the rights and powers, and be subject to the restrictions
and liabilities, of the transferor Member to the extent of the Interest transferred.

 

 (e)          If a party ceases to own any Units in accordance with the terms of this Agreement, its rights and obligations hereunder shall
terminate except as provided in Section 11.01(b) or as otherwise expressly provided herein to survive such cessation
of ownership.

 

 (f)          Notwithstanding anything to the contrary herein, no Member may Transfer any Units if such Transfer would result in the Company
having more than 99 Members. Any Transfer of Units that would have the result prescribed in the preceding sentence shall be void,
and the Company shall not recognize any such Transfer.

 

Section
10.02. Trigger Events.

 

(a)
Event. The occurrence of any one or more of the following events shall constitute a trigger event (each, a "Trigger
Event"):

 

(i)          Any
payment (including, the payment of the Liquidation Preference or the Total Redemption Amount) or distribution to any Preferred
Member hereunder is not made when due and, in the case of any amount due on any Preferred Payment Date, is not cured within fifteen
(15) days thereafter.

 

(ii)         Any
representation or warranty made by the Company or the Common Members herein, or in any report, certificate, financial statement
or other instrument, agreement or document furnished to the Preferred Member, shall have been false in any material respect as
of the date the representation or warranty was made;

 

    	26

    	 

    

  

(iii)        [intentionally
deleted];

 

(iv)        The
Company and/or the Manager shall fail to obtain the approval of the Preferred Member with respect to any matter subject to approval
rights under Section 7.02;

 

(v)         Bluerock
shall at any time no longer control, directly or indirectly, the day-to-day management and operations of the Manager and the Company;

 

(vi)        Any
Transfer shall be made in violation of the provisions of Section 10.0l(a); or

 

(vii)       The
Company, the Manager or any Guarantor shall make an assignment for the benefit of creditors in contravention of this Agreement;

 

(viii)      A
receiver, liquidator or trustee shall be appointed for the Company or the Manager, or the Company, the Manager or any Guarantor
shall be adjudicated a bankrupt or insolvent, or any petition for bankruptcy, reorganization or arrangement pursuant to federal
bankruptcy law, or any similar federal or state law, shall be filed by or against, consented to, or acquiesced in by the Company,
the Manager or any Guarantor, or any proceeding for the dissolution or liquidation of the Company, the Manager or any Guarantor
shall be instituted; provided, however, that if such appointment, adjudication, petition or proceeding was involuntary
and not consented to by the Company, the Manager or any Guarantor, as the case may be, the same shall constitute a Trigger Event
only upon the same not being discharged, stayed or dismissed within sixty (60) days and, in the case of any stay, until the expiration
or lifting thereof;

 

(ix)        Any
Property Management Agreement (or any replacement Property Management Agreement) with respect to the Property is terminated for
any reason and a successor Property Manager is not appointed within forty five (45) days after such termination; or

 

(x)        Any
Mortgage Loan Default shall occur and be continuing.

 

Section
10.03.     Consequences of Trigger Event. Upon the delivery of written notice to the Manager that a Trigger Event has
occurred and is continuing, the Preferred Member, in addition to and without limiting all other remedies permitted hereunder or
at law or in equity, may do any one or more of the following:

 

(a)          Mandatory
Redemption. The Preferred Member shall have the right, but not the obligation, to give written notice to the Manager requiring
the Company to immediately redeem in cash the entire Unreturned Preferred Contribution at a redemption price equal to the Total
Redemption Amount in accordance with Section 4.03(b)(ii) of this Agreement.

 

    	27

    	 

    

  

 (b)          Disposition
of Company Assets. Subject to the terms and provisions of the Mortgage Loan Documents, the Preferred Member may (but shall
not be required to) elect to cause the Company to irrevocably assign, transfer and convey all the Company's right, title and interest
in and to the Property or any of them to a Person for cash or other consideration which shall be paid to the Preferred Member
and credited against the Total Redemption Amount, until it has been reduced to zero, at which time the Preferred Contribution
shall be deemed to have been reduced to zero, and the balance of the cash or other consideration from such assignment, transfer
or conveyance shall be paid to the Company, provided that any such disposition shall be made in connection with a sales effort
conducted in a commercially reasonable manner, determined by reference to the standards of commercial reasonableness applicable
to a secured party's disposition of collateral after default under the provisions of Article 9 of the UCC (a "Commercial
Disposition Effort"). The parties acknowledge and agree that a sales effort involving a sixty (60) day market exposure
period during which invitations to bid are transmitted to the Manager and five (5) additional Persons that Manager reasonably
determines, in its discretion, are qualified to purchase any Property being sold or transferred shall constitute a Commercial
Disposition Effort conducted in a commercially reasonable manner.

 

 (c)
Other Remedies. The Preferred Member shall have any other rights and remedies available hereunder or at law or in equity.
More specifically, but not in limitation of the rights and remedies of the Preferred Member, the Preferred Member may, subject
to the terms and conditions of the Mortgage Loan Documents, do or cause the Company (and any Subsidiary) to do any or all of the
following:

 

(i)          collect
by legal proceedings or otherwise (including by foreclosure of any lien) all dividends, distributions, interest, principal or
other sums now or hereafter payable upon or on account of any assets of the Company;

 

(ii)         subject
to the provisions of Section 10.03(c) above, enter into any extension or reorganization agreement or any other agreement
relating to or affecting any asset of the Company or any other contracts or arrangements of the Company and, in connection therewith,
deposit or surrender control of any asset of the Company or accept other property in exchange therefore;

 

(iii)        settle,
compromise or release, on terms acceptable to the Preferred Member, in whole or in part, any amounts owing on any asset of the
Company or any disputes with respect thereto;

 

(iv)       subject to the provisions of Section 10.03(c) above, exercise any and all other rights, powers, privileges and remedies
of an owner of the assets of the Company or any of them.

 

(d)         Sale
of Property.

 

(i)          The receipt given by the Preferred Member, on behalf of the Company, for the purchase money paid at the sale of any Property conducted
in accordance with Section 10.03(c) above shall be a sufficient discharge therefor to any purchaser of all or any part
of such Property sold. No such purchaser, after paying such purchase money and receiving such receipt, shall be bound to see to
the application of such purchase money or any part thereof or in any manner be answerable for any loss, misapplication or nonapplication
of any such purchase money, or any part thereof; or be bound to inquire as to the authorization, necessity, expediency or regularity
of any such sale.

 

    	28

    	 

    

  

(ii)         Each purchaser at any sale or other disposition by the Preferred Member (on behalf of the Company or in its own name) conducted
in accordance with Section 10.03(c) above shall hold the Property so sold absolutely, free from any claim or right of any
kind whatsoever of the Manager and the other Members, including, without limitation, any equity or right of redemption of the
Manager and the other Members. The Manager and the other Members, to the fullest extent permitted by law, hereby specifically
waive all rights of redemption, principal, stay, valuation or appraisal which they have or may have under any rule, law or statute
now existing or hereafter in force in connection with a sale or other disposition of any one or more of the Property conducted
in accordance with Section 10.03(c) above.

 

(iii)        In
case of any sale of the Property conducted in accordance with Section 10.03(c) above on credit or for future delivery,
the Property so sold may be retained by the Preferred Member until the selling price is paid by the purchaser thereof, but the
Preferred Member shall not incur any liability in case of the failure of such purchaser to take up and pay for the Property so
sold and, in case of any such failure, such Property may again be sold upon like notice in accordance with Section l0.03(c)
above. No credit shall be given against the Total Redemption Amount unless and until the Preferred Member receives payment
on any such credit sale.

 

(iv)      Subject
to any requirements of applicable law and the Preferred Member's compliance with its obligations set forth in this Agreement,
neither the Manager nor the other Common Members shall at any time have or assert any right pertaining to the marshaling of assets,
the sale of property in the inverse order of alienation or the administration of estates of decedents to prevent or hinder the
exercise of the rights of the Preferred Member or any purchaser of the Property or any of them pursuant to this Agreement, and
the Manager and the other Common Members, to the fullest extent permitted by applicable law, but subject to the Preferred Member's
compliance with its obligations set forth in this Agreement, hereby waive the benefit of any such rights. The Manager and the
other Common Members further waive, to the fullest extent permitted by law, but subject to the Preferred Member's compliance with
its obligations set forth in this Agreement, any right to require the Preferred Member (1) to pursue any remedy whatsoever that
the Preferred Member may possess, (2) to obtain any bond or other security under claim and delivery proceedings or otherwise,
(3) to retain possession and not dispose of the Property taken under claim and delivery proceedings until after trial or final
judgment, (4) to provide a traditional hearing prior to the time the Preferred Member exercises any rights or takes any action
under this Agreement, or (5) to concede possession to the Manager and the other Common Members pending the initiation or conclusion
of judicial process.

 

ARTICLE
11

 

EXCULPATION
AND INDEMNIFICATION

 

Section
11.01.  Exculpation and Indemnification. (a) No Member, Manager or Tax Matters Partner, or any officer of the Company
or any of their respective Affiliates or any of their respective shareholders, partners, members, employees, representatives or
agents (collectively, "Covered Persons") shall be liable to the Company or any other Covered Person for monetary
damages for any breach of fiduciary duty relating to the Company to the fullest extent permitted by the laws of the State of Delaware.

 

    	29

    	 

    

 

(b)           Each Person (and the heirs, executors or administrators of such Person) who was or is a party or is threatened to be made a party
to, or is involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative,
or investigative, by reason of the fact that such Person is or was a Covered Person shall be indemnified and held harmless by
the Company to the fullest extent permitted by the laws of the State of Delaware. The right to indemnification conferred in this
Section 11.01 shall also include the right to be advanced by the Company the expenses incurred in connection with any such
proceeding in advance of its final disposition to the fullest extent permitted by the laws of the State of Delaware; provided,
that any Covered Person shall promptly repay all such advances to the Company if it shall be ultimately determined by a court
of competent jurisdiction that such Covered Person was not entitled to be indemnified by the Company in connection with such proceeding;
and provided, further, that until such time as all of the obligations under the Mortgage Loan Documents have been
satisfied in full, no indemnity payment to any Covered Person (except to the Preferred Member) from funds of the Company (as distinct
from funds from other sources, such as insurance) of any indemnity under this Article 11 shall be payable from amounts
allocable to any other Person pursuant to this Agreement and the Mortgage Loan Documents. The right to indemnification conferred
in this Section 11.01 shall be a contract right.

 

(c)         The
Company may, by action of the Manager, provide indemnification to such other officers, employees and agents of the Company or
of any Covered Person or other persons who are or were serving at the request of the Company as a director, officer, employee
or agent of another limited liability company, corporation, partnership, joint venture, trust or other enterprise to such extent
and to such effect as the Manager shall determine to be appropriate.

 

(d)          The
Company shall have the power to purchase and maintain insurance on behalf of any person who is or was a Covered Person or an officer,
employee or agent of the Company, or is or was serving at the request of the Company as a member, manager, director, officer,
employee or agent of another limited liability company, corporation, partnership, joint venture, trust or other enterprise against
any expense, liability or loss incurred by such person in any such capacity or arising out of his status as such, whether or not
the Company would have the power to indemnify such entity or individual against such liability under the laws of the State of
Delaware.

 

(e)          Notwithstanding
the provisions of this Section 11.01 to the contrary, the Company shall be personally liable to the Preferred Member for
the actual Damages that the Preferred Member incurs to the extent arising out of, resulting from or in connection with any one
or more of the following:

 

(1)         any
wrongful removal or destruction of any portion of the Property or any intentional waste of the Property or any portion thereof;

 

(2)         any
misrepresentation, miscertification or breach of warranty by the Company, a Common Member or Guarantor with respect to any representation,
warranty or certification contained in this Agreement or any Mortgage Loan Document or in any document executed in connection
therewith, pursuant hereto and/or the Mortgage Loan Documents or otherwise to induce the Preferred Member to make the Preferred
Contribution;

 

(3)         any
misapplication or misappropriation by the Company of (A) any Insurance Proceeds paid by reason of any loss, damage or destruction
to any of the Property, (B) any Awards or other amounts received in connection with the Condemnation of all or a portion of the
Property, (C) any rents from the Property received following a Mortgage Loan Default, or (D) any security deposits or rents from
the Property paid more than one month in advance;

 

    	30

    	 

    

  

(4)         any
misapplication or misappropriation by the Company of Net Sales Proceeds or any distributions or other payments made in respect
of any of the Property; and/or

 

(5)         the
Company making a distribution to one or more of its equity owners in violation of this Agreement.

 

(f)          The
rights and authority conferred in this Section 11.01 shall not be exclusive of any other right which any Person may otherwise
have or hereafter acquire.

 

(g)          Neither
the amendment of this Section 11.01, nor to the fullest extent permitted by the laws of the State of Delaware, any modification
of law, shall eliminate or reduce the effect of this Section 11.01 in respect of any acts or omissions occurring prior
to such amendment or modification.

 

Section
11.02. Waiver of Corporate Opportunity. To the fullest extent permitted by applicable law, the doctrine of corporate
opportunity, or any other analogous doctrine, shall not apply with respect to the Company, and no Member, Manager, Tax Matters
Partner or Affiliate of a Member, Manager or Tax Matters Partner shall have any obligation to refrain from (i) engaging in similar
activities or lines of business as the Company or developing or marketing any products or services that compete, directly or indirectly,
with those of the Company, (ii) investing or owning any interest publicly or privately in, serving as a director or officer of
or developing a business relationship with, any Person engaged in similar activities or lines of business as, or otherwise in
competition with, the Company, (iii) doing business with any client or customer of the Company or (iv) employing or otherwise
engaging a former officer or employee of the Company; and neither the Company nor any Member, Manager or Tax Matters Partner (or
Affiliate of such Member, Manager or Tax Matters Partner) shall have any right by virtue of this Agreement in or to, or to be
offered any opportunity to participate or invest in, any venture engaged or to be engaged in by the other Members, the Manager,
the Tax Matters Partner or any Affiliate of the other Members, the Manager or the Tax Matters Partner, or any right by virtue
of this Agreement in or to any income or profits derived therefrom.

 

ARTICLE
12

TERMINATION,
DISSOLUTION

AND
LIQUIDATION

 

Section
12.01. Term. The term of the Company shall continue until it is dissolved, wound up and terminated pursuant to this
Article 12. The existence of the Company as a separate legal entity shall continue until cancellation of the Certificate
of Formation as provided in the Delaware Act.

 

Section
12.02. Winding Up Events. (a) The Company shall dissolve and commence winding up upon the first to occur of any
of the following events (each a "Winding Up Event"):

 

     (i)          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 in the Company unless the Company is continued
without dissolution in a manner permitted by this Agreement or the Delaware Act;

 

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     (ii)         subject
to Section 7.02, the written election of the Manager to dissolve, wind up and liquidate the Company; or

 

    (iii)        the
entry of a decree of judicial dissolution pursuant to Section 18-802 of the Delaware Act.

 

(b)          Upon
the occurrence of any event that causes the last remaining member of the Company to cease to be a Member of the Company, to the
fullest extent permitted by law, the personal representative of such Member is hereby authorized to, and shall, within 90 days
after the occurrence of the event that terminated the continued membership of such Member in the Company, agree in writing (i)
to continue the Company and (ii) to the admission of 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 or the Member in the Company.

 

(c)          Notwithstanding
any other provision of this Agreement, the Bankruptcy of a Member shall not cause such Member to cease to be a member of the Company
and upon the occurrence of such an event, the Company shall continue without dissolution.

 

Section
12.03. Winding Up. Upon the occurrence of a Winding Up Event, the Company shall continue solely for the purposes
of winding up its affairs in an orderly manner, liquidating its assets, and satisfying or making reasonable provision for the
satisfaction of the claims of its creditors and Members, and no Member shall take any action that is inconsistent with, or not
necessary to or appropriate for, the winding up of the Company's business and affairs; provided that all covenants contained
in this Agreement and obligations provided for in this Agreement shall continue to be fully binding upon the Members until such
time as the assets or property or the proceeds from the sale thereof have been distributed pursuant to this Article 12
and the Company has terminated by the filing of a Certificate of Cancellation of the Certificate of Formation of the Company with
the Secretary of State of the State of Delaware. The Manager shall be responsible for overseeing the winding up and dissolution
of the Company. The Manager shall take full account of the Company's assets and liabilities, and the Company's affairs shall be
wound up in an orderly manner. To the extent that the Manager determines that any or all of the assets of the Company shall be
sold, such assets shall be sold as promptly as possible, but in a business-like manner so as not to involve undue sacrifice. Notwithstanding
the foregoing, in the event of the winding up or dissolution of the Company as a result of a Trigger Event, the Preferred Member
shall be entitled to appoint a Third Party to act as an independent liquidating trustee pursuant to the Delaware Act with responsibility
for overseeing the winding up and dissolution of the Company.

 

Section
12.04. Distribution Upon Dissolution of the Company. The Company's assets or the proceeds from the sale thereof
pursuant to this Article 12 to the extent sufficient therefor shall be applied and distributed to the maximum extent permitted
by law, in the following order:

 

(a)          first,
to the satisfaction (whether by payment or by the making of reasonable provision for payment) of all of the Company's debts
and liabilities to Third Party creditors;

 

(b)
        second, to
the Preferred Member in the amounts specified in Section 4.02(a); and

 

(c)          third,
the balance, if any, to the Common Members in accordance with their respective Common Interest Percentages.

 

    	32

    	 

    

  

Section
12.05. Rights of Members; Resignation.

 

(a)          Except
as otherwise provided in this Agreement or in any agreement referred to in this Agreement, each Member shall look solely to the
assets of the Company for the return of its Capital Contributions and shall have no right or power to demand or receive property
other than cash from the Company.

 

(b)          No
Member shall resign from the Company prior to the dissolution and winding up of the Company in accordance with this Agreement
except as a consequence of a permitted Transfer of all of such Member's Interest.

 

ARTICLE
13

 

MISCELLANEOUS

 

Section
13.01. Notices. All notices, requests and other communications to any party or to the Company shall be in writing
(including facsimile or similar writing) and shall be given, in the case of any Member, to the address of such Member as set forth
in the books and records of the Company, and

 

	  if to the Company or the Manager, to:	c/o Bluerock Real Estate, LLC
	 	712 Fifth Avenue, 9th Floor
	 	New York, NY 10019
	 	Attention: Jordan Ruddy and Michael Konig
	 	Facsimile: (212) 278-4220
	 	 
	  with a copy to:	Hirschler Fleischer
	 	Edgeworth Building
	 	2100 East Cary Street
	 	Richmond, Virginia 23223
	 	Attention: S. Edward Flanagan, Esq.
	 	Facsimile: (804) 644-0957
	 	 
	  if to Preferred Member, to:	c/o Bluerock Real Estate, LLC
	 	712 Fifth Avenue, 9th Floor
	 	New York, NY 10019
	 	Attention: Jordan Ruddy and Michael Konig
	 	Facsimile: (212) 278-4220

 

    	33

    	 

    

  

	with a copy to:	Hirschler Fleischer
	 	Edgeworth Building
	 	2100 East Cary Street
	 	Richmond, Virginia 23223
	 	Attention: S. Edward Flanagan, Esq.
	 	Facsimile: (804) 644-0957

 

or,
in each case, to such other address or facsimile number as such party or the Company may hereafter specify for the purpose by
notice to the other parties and the Company. All such notices, requests and other communications shall be deemed received on the
date of receipt by the recipient thereof if received prior to 5 p.m. in the place of receipt and such day is a Business
Day in the place of receipt. Otherwise, any such notice, request or communication shall be deemed not to have been received until
the next succeeding Business Day in the place of receipt.

 

Section
13.02. Amendments; No Waivers. (a) Any provision of this Agreement may be amended or waived if, and only if, such
amendment or waiver is in writing and agreed to, (i) in the case of an amendment, (A) by Common Members holding a majority of
the outstanding Common Units and (B) by the Preferred Member with respect to any amendment that would reasonably be expected to
adversely affect any Preferred Member or (ii) in the case of a waiver, by the party or parties against whom the waiver is to be
effective; provided that this Agreement shall, without any further action required, be deemed amended from time to time
to reflect admission of a new Member and the withdrawal or resignation of a Member, in each case that is made in accordance with
the provisions hereof.

 

(b)          Except
as expressly set forth herein, no failure or delay by any party in exercising any right, power or privilege hereunder shall operate
as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. Except as otherwise provided herein, the rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies provided by law.

 

Section
13.03. Expenses. All costs and expenses incurred in connection with this Agreement and the transactions contemplated
hereby shall be paid by the party incurring such costs and expenses.

 

Section
13.04. Successors and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective permitted successors and assigns. This Agreement is for the sole benefit of the parties
hereto and, except as provided in Article 11, nothing herein expressed or implied shall give or be construed to give any
Person, other than the parties hereto, any legal or equitable rights hereunder.

 

Section
13.05. Headings. Headings are for ease of reference only and shall not form a part of this Agreement.

 

Section
13.06. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED AND INTERPRETED IN ACCORDANCE WITH AND GOVERNED BY
THE LAW OF THE STATE OF DELAWARE WITHOUT GIVING EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF. PRINCIPLES), ALL
RIGHTS AND REMEDIES BEING GOVERNED BY SAID LAWS.

 

    	34

    	 

    

 

Section
13.07. Jurisdiction and Venue. Members consent to the exclusive jurisdiction of the Federal and state courts situated
in the County of New York, New York in connection with any action arising out of or based on this Agreement and the transactions
contemplated by this Agreement.

 

Section
13.08. Waiver of Jury Trial. Members hereby waive trial by jury in any action, proceeding or counterclaim brought
by either of the parties hereto against the other on any matters whatsoever arising out of or in any way connected with this Agreement,
and any emergency statutory or any other statutory remedy.

 

Section
13.09. Counterparts; Effectiveness. This Agreement may be signed in any number of counterparts, each of which shall
be deemed an original. This Agreement shall become effective when each party shall have received a counterpart hereof signed by
each of the other parties.

 

Section
13.10. Severability. In case any one or more of the provisions or part of a provision contained in this Agreement
shall for any reason be held to be invalid, illegal or unenforceable, such invalidity, illegality or unenforceability shall be
deemed not to affect any other provision or part of a provision of this Agreement, but the Agreement shall be reformed and construed
as if such provision or part of a provision held to be invalid, illegal or unenforceable had never been contained herein and such
provision or part reformed so that it would be valid, legal and enforceable to the maximum extent possible.

 

Section
13.11. Further Assurances. The parties hereto will execute and deliver such further instruments and do such further
acts and things as may be required to carry out the intent and purpose of this Agreement.

 

Section
13.12. Entire Agreement. This Agreement, including the exhibits and schedules hereto and thereto, constitute the
entire agreement among the parties hereto and thereto with respect to the subject matter hereof and thereof, and supersede all
other prior agreements or undertakings with respect thereto, both written and oral. The parties acknowledge and agree that no
representations, warranties, instruments, promises, understandings or conditions have been made or relied upon by the parties
or any of their Affiliates in connection with the transactions contemplated hereby except as set forth herein or therein.

 

[Remainder
of Page Intentionally Left Blank; Signature Page Follows]

 

    	35

    	 

    

  

IN
WITNESS WHEREOF, the parties hereto have entered into this Agreement or have caused this Agreement to be duly executed by their
respective authorized officers, in each case as of the day and year first above written.

 

	 	BLUEROCK REAL ESTATE, LLC,
	 	as Manager
	 	 	 
	 	By:	/s/ R. Ramin Kamfar
	 	 	Name: R. Ramin Kamfar
	 	 	Title: CEO
	 	 	 
	 	BLUEROCK SPECIAL OPPORTUNITY AND
	 	INCOME FUND III, LLC
	 	as Preferred Member
	 	 	 
	 	By:	BR SOIF III Manager, LLC, a Delaware limited
	 	 	liability company, its manager
	 	 	 
	 	 	By:	/s/ R. Ramin Kamfar
	 	 	Name: R. Ramin Kamfar
	 	 	Title: Authorized Signatory
	 	 	 
	 	COMMON MEMBERS:
	 	 	 
	 	/s/ R. Ramin Kamfar
	 	R. Ramin Kamfar
	 	 	 
	 	/s/ Randy I. Anderson
	 	Randy I. Anderson
	 	 	 
	 	/s/ Jordan Ruddy
	 	Jordan Ruddy
	 	 	 
	 	/s/ Jerold V. Novack for Jenco Business  Advisors, Inc.
	 	Jerold V. Novack for Jenco Business  Advisors, Inc.
	 	 	 
	 	/s/ James Babb III
	 	James Babb III
	 	 	 
	 	/s/ Ryan MacDonald
	 	Ryan MacDonald

 

    	36

    	 

    

  

Schedule
A

 

Membership
Interests

 

 

	Member	 	Number of Units	 	 	Percentage of Units	 
	 	 	 	 	 	 	 
	Common Members	 	 	 	 	 	 	 	 
	R. Ramin Kamfar	 	 	167,552.59	 	 	 	67.02	%
	Randy I. Anderson	 	 	14,017.10	 	 	 	5.61	%
	Jordan Ruddy	 	 	21,706.62	 	 	 	8.68	%
	Jenco Business	 	 	 	 	 	 	 	 
	Advisors, Inc.	 	 	24,919.30	 	 	 	9.97	%
	James Babb III	 	 	14,017.10	 	 	 	5.61	%
	Ryan MacDonald	 	 	7.787.28	 	 	 	3.11	%
	 	 	 	250,000.00	 	 	 	100.00	%

 

	Preferred Member	 	 	 	 
	 	 	 	 	 
	Bluerock Special	 	1,719,289 Preferred Units 	 	100% Preferred Units
	Opportunity  + Income	 	 	 	 
	Fund III, LLC	 		 	 

 

    	 

    	 

    

  

SCHEDULE B

PROPERTY OWNER'S
AMENDED AND RESTATED

 LIMITED LIABILITY COMPANY AGREEMENTExhibit 10.25

 

PROPERTY MANAGEMENT AGREEMENT

 

THIS PROPERTY MANAGEMENT
AGREEMENT (the “Agreement”) made this 30th day of April, 2013, by and between BR – NPT SPRINGING
ENTITY, LLC, a Delaware limited liability company (“Owner”), and BLUEROCK PROPERTY MANAGEMENT, LLC, a Michigan limited
liability company (“Property Manager”).

 

A.           WHEREAS,
Property Manager has been managing that certain condominium apartment project located at 16500 North Park Drive, Southfield, Michigan
(the “Project”) pursuant to a Property Management Agreement dated December 8, 2005 (the “Prior Management Agreement”)
between Property Manager and BR - North Park Towers Leaseco, LLC (“Master Tenant”), which Prior Management Agreement
previously expired by its terms.

 

B.           WHEREAS,
the Master Lease Agreement dated December 8, 2005 (the “Master Lease”) between BR - North Park Towers, DST (the “Trust”)
and Master Tenant previously expired in accordance with its terms. Notwithstanding the expiration of the Master Lease and the Prior
Management Agreement, the Property Manager has continued to manage the Project. In connection with the transfer of ownership of
the Project from the Trust to Owner, the Owner desires to establish an alternative management relationship with respect to the
Project in lieu of, and in the place of, the Master Lease and the Prior Management Agreement.

 

C.           WHEREAS,
the Owner desires to employ Property Manager in the management and operation of the Project by turning over to Property Manager
the operation, direction, management and supervision of the Project, subject to and in accordance with the terms and condition
set forth in this Agreement, and Property Manager desires to assume such duties upon the terms and conditions set forth in this
Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in
consideration of the premises and the mutual promises and covenants herein contained, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Owner and Property Manager agree as follows:

 

Article
I APPOINTMENT

 

Owner hereby grants
to Property Manager, as an independent contractor, the sole and exclusive right to manage and operate the Project, subject to the
terms and provisions of this Agreement. During the term of this Agreement, Owner shall not participate in the day-to-day operation
of the Project and shall at no time directly order or instruct any employees or other personnel engaged in the day-to-day management
and operation of the Project. The foregoing shall not restrict the right of Owner to direct any questions, orders or instructions
regarding operations of the Project to the Property Manager.

 

Article
II TERM OF AGREEMENT

 

2.1           Term.
Subject to Sections 2.2 and 2.3 hereof, the initial term of this Agreement shall be 12 months, commencing on [March] __, 2013,
and expiring on March 31, 2014, but it will be automatically renewed thereafter on a year-to-year basis unless terminated by one
of the parties (the “Term”).

 

    	 

    	 

    

 

2.2           Effect
of Expiration or Termination. Any expiration or termination of this Agreement shall in no way affect or impair any rights or
obligations which have accrued to either party pursuant to this Agreement prior to such expiration or termination, including, without
limitation, the rights of Property Manager to receive payments provided for hereunder, without set-off, recoupment or similar withholding
of payment by Owner. In the event of any termination of this Agreement, Property Manager shall use commercially reasonable efforts
to effect an orderly transition of the management and operation of the Project to Owner or an agent designated by Owner and to
cooperate with Owner or such agent.

 

Upon any termination
or expiration of this Agreement, and provided all payments due Property Manager have been paid in full, including the Termination
Fee (as defined below), if applicable, Property Manager shall:

 

(a)          account
for and deliver to Owner all receipts, charges and income from the Project (including, without limitation, tenant security deposits)
and other monies of Owner in Property Manager’s actual possession or control;

 

(b)          deliver
to Owner any monies due Owner under this Agreement received after such termination;

 

(c)          deliver
to Owner, or to such other person as Owner shall designate, all materials, supplies, equipment, keys, contracts, documents, books
and records (including, without limitation, accounts payable, financial records and accounting records) pertaining to this Agreement
and/or the Project;

 

(d)          assign
any then existing contracts and permits in the name of Property Manager, as agent for Owner, relating to the Project to Owner or
to such party as Owner shall designate;

 

(e)          within
45 days after the effective date of expiration or termination of this Agreement, cause to be furnished to Owner a statement similar
in form and content to its monthly statement covering the period from the date of the last such previous statement to the date
of the termination of this Agreement; and

 

(f)          Within
90 days following such expiration or termination, Property Manager shall deliver to Owner a final accounting, in writing, with
respect to the operations of the Project. Subsections 2.2(e) and 2.2(f) shall survive the expiration or termination of this Agreement.

 

2.3           Assumption
of Obligations. Upon the expiration or termination of this Agreement, Owner shall assume the obligations of any contract executed,
and the responsibility for payment of all unpaid bills incurred, by Property Manager in accordance with this Agreement for and
on behalf of Owner.

 

2.4           Termination
Fee. In the event this Agreement is terminated, other than through the expiration of the Term hereof, by the action of the
Owner or the Owner’s default hereunder, Owner shall pay to Property Manager a termination fee in a lump-sum amount equal
to the sum of (i) any Accrued Fees (as defined below) not previously paid (or forgiven by Property Manager) and (ii) the Management
Fee that would accrue from and after the date upon which such termination shall become effective, over the remainder of the stated
Term of this Agreement (the “Termination Fee”). For this purpose, the monthly Management Fee for the remainder of the
stated Term shall be presumed to be the same as that of the last month prior to termination. Property Manager acknowledges that
its right to receive payment of a Termination Fee is personal to the Owner and does not extend to any obligations Owner may have
to any Lender (as hereafter defined), and that such Termination Fee is subordinate to any obligations Owner may have to such Lender.

 

    	2

    	 

    

 

Article
III MANAGEMENT

 

3.1           General
Management Duties. Subject to the availability of funds provided under the Budget (as defined in Section 3.3 hereof) and in
the Operating Account (as defined in Section 5.1 hereof), Property Manager shall manage and operate the Project in a manner consistent
with the management and operation of comparable properties in Southfield, Michigan, shall provide such services as are customarily
provided by a manager of properties of comparable class and standing, and shall consult with Owner and keep Owner advised as to
all material or extraordinary matters and decisions affecting the Project. Specifically, Property Manager shall perform, without
limitation, the following services and duties for Owner in a faithful, diligent and efficient manner:

 

(a)          Maintain
businesslike relations with residents of the Project whose service requests shall be received, considered, and recorded in systematic
fashion in order to show the action taken with respect to each request. Complaints of a serious nature shall, after thorough investigation,
be reported to Owner with appropriate recommendations for addressing such complaints;

 

(b)          Use
good faith efforts to collect all rents and other sums and charges due from residents, subresidents, licensees, and concessionaires
of the Project and all other receipts, if any, derived from the operation of the Project;

 

(c)          Prepare
or cause to be prepared for execution and filing by Owner all forms, reports, and returns, if any, required by all federal, state,
or local laws in connection with unemployment insurance, workmen’s compensation insurance, disability benefits, Social Security,
and other similar taxes now in effect or hereafter imposed, and also any other requirements relating to the employment of personnel
for the Property Manager; however, Property Manager shall not be obligated to prepare any of Owner’s local, state, or federal
income tax returns;

 

(d)          Subject
to the limitations of the approved Budget adopted pursuant to Section 3.3 hereof, pay prior to delinquency all real estate taxes,
personal property taxes, and assessments levied against the Project, or any part thereof; and

 

(e)          Subject
to the limitations of the approved Budget adopted pursuant to Section 3.3 hereof, perform such other acts as are reasonable, necessary,
and proper in the discharge of its duties under this Agreement.

 

3.2           Leasing.

 

(a)          Exclusive
Agency. Property Manager shall be the sole rental agent for the Project, and Owner may not employ any outside rental agent
or broker without the prior written consent of Property Manager. The Property Manager shall exercise commercially reasonable efforts
to obtain and keep financially responsible tenants of the Project. All inquiries concerning any leases or renewals or agreements
for the rental of any tenant space in the Project shall be referred to Property Manager. The Property Manager shall conduct and
coordinate the negotiation and execution and delivery of leases and renewals, modifications, and cancellations thereof. All leases
are to be prepared by Property Manager in accordance with the standard form lease established by Property Manager and approved
by Owner. Property Manager may execute tenant leases on behalf of Owner in the ordinary course of business on the standard lease
form approved by Owner for the Project. Leases and other agreements with tenants shall be executed and delivered by the Property
Manager as agent of Owner. All other leases shall be subject to the prior specific written approval of Owner.

 

    	3

    	 

    

 

(b)          Advertising;
Promotion. Owner agrees that Property Manager may use the services of any third party rental or leasing agency, including any
apartment locator services in the area where the Project is located, and the fees payable for such services shall be expenses of
Owner, payable out of the Operating Account for the Project. The Property Manager may also prepare and use at Owner’s expense
reasonable advertising plans and promotional material to further rentals. Property Manager shall not use Owner’s name in
any advertising or promotional material without Owner’s prior written approval.

 

3.3           Budget.

 

(a)          Budget
Approval Process. Property Manager shall submit for approval of Owner not later than 30 days after the date of this Agreement
a proposed detailed, written estimate or projection of all receipts and expenditures for the operation of the Project for first
full or partial Fiscal Year (as hereinafter defined), including, without limitation, all estimated rentals and all estimated repairs,
maintenance and capital projects (the “Budget”) for such Fiscal Year. In addition, Property Manager shall submit a
Budget for each ensuing Fiscal Year for the approval of Owner not later than thirty (30) days prior to the expiration of the Fiscal
Year immediately preceding the Fiscal Year to which such Budget relates. A “Fiscal Year” is a calendar year, all or
part of which falls within the Term of this Agreement. In the event Owner, in Owner’s sole judgment, disapproves of any proposed
Budget submitted by Property Manager, Owner shall give Property Manager written notice of the line items that have been disapproved,
in which event Property Manager and Owner shall work in good faith to establish mutually-acceptable amounts for such line items.
Until Owner has approved the revised Budget, Property Manager may (i) pay the Management Fee (as hereinafter defined) and all expenses
relating to taxes, insurance and utilities, (ii) operate pursuant to those portions of the Budget which have been approved, and
(iii) with respect to line items that have not been approved, continue to operate pursuant to the corresponding line items in the
last approved Budget. In the absence of any written notice from Owner of disapproval within 30 days after delivery of the proposed
Budget to Owner, the proposed Budget shall be deemed to have been approved by Owner.

 

(b)          Payment
of Budgeted Expenses. Property Manager shall have the right to pay all expenses according to the approved Budget, including
the Management Fee. Notwithstanding any other provision in this Agreement, without the prior written consent of Owner, Property
Manager shall not incur or permit to be incurred expenses under this Agreement (excluding only utility expenses, general real estate
taxes, insurance premiums, financing costs and emergency expenses) that exceed 10% of the applicable line item in the Budget. Property
Manager shall promptly notify Owner whenever Property Manager determines that the Budget or any line item in the Budget is insufficient
to cover the expenses of operating the Project or the applicable expense category.

 

3.4           Reimbursable
Costs. All costs incurred by Property Manager in the performance of its duties under this Agreement that are in accordance
with the approved Budget, including, but not limited to, postage, copying, courier charges, bank charges, long distance telephone
and other such costs as would normally be incurred in the operation of the Project at both the Project and corporate offices, shall
be reimbursed by Owner, in addition to the Management Fee and other payments due hereunder.

 

3.5           Project
Personnel. Property Manager may, at Owner’s expense and in accordance with the approved Budget, either itself or through
an entity (hereinafter referred to as the “PM Entity”) wholly owned by or affiliated with Property Manager, hire, employ,
supervise and discharge all employees required in connection with the operation and management of the Project. Property Manager
or the PM Entity, as the case may be, shall provide and maintain, at Owner’s expense so long as this Agreement is in force,
workmen’s compensation insurance in full compliance with all applicable state and federal laws and regulations.

 

    	4

    	 

    

 

Employees of the Property
Manager or the PM Entity, as the case may be, may include the following:

 

(a)          Property
Manager. A full-time person who is experienced in the administration and operation of condominium apartment projects of the
size, character, and quality of the Project;

 

(b)          Others.
Such other personnel to manage, operate and maintain the Project, including, but not limited to, an assistant property manager,
leasing consultant, maintenance manager, administrative personnel, accounting personnel, grounds keepers, janitorial and custodial
persons, and courtesy personnel, as Property Manager reasonably deems necessary or consistent with the level of service provided
by other similar properties. All such personnel shall, except to the extent provided in the approved Budget, spend 100% of their
work time on the operation and maintenance of the Project.

 

3.6           Contracts
and Supplies. Property Manager shall, at Owner’s expense, at the lowest cost as in its judgment is consistent with good
quality, workmanship and service standards, enter into contracts in its own name as agent for Owner for the furnishing to the Project
of required utility services, heating and air-conditioning services and other maintenance, pest control, and any other services
and concessions which are reasonably required in connection with the maintenance and operation of the Project; provided, however,
(i) that any contracts entered into by Property Manager, whenever practicable, shall be terminable at Property Manager’s
or Owner’s sole discretion within 30 days by written notice unless Property Manager receives the prior written consent of
Owner to the contrary, (ii) if the amount payable monthly or for any given month pursuant to such contract exceeds $10,000,
Property Manager shall obtain Owner’s written approval thereof prior to entering into such contract (such approval shall
be deemed granted if not disapproved in writing by Owner within five (5) days of Property Manager’s request for approval)
and (iii) if the contract is with an affiliate the relationship must be disclosed to the Owner and the terms must be as favorable
as those that would be obtained if the transaction were at arm’s length. Each of such contracts shall state that Property
Manager is acting as a special limited agent of Owner having only the express powers that are delegated and authorized pursuant
to this Agreement. When taking bids, Property Manager shall use all reasonable efforts to secure for, and credit to Owner, any
discounts, commissions or rebates obtainable as a result of such purchases or services. Property Manager shall use all reasonable
efforts to make purchases and (where necessary or desirable) let bids for necessary labor and materials at the lowest possible
cost as in its judgment is consistent with good quality, workmanship and service standards. In addition, Property Manager shall
use reasonable efforts to purchase goods and services through Property Manager’s or, if so directed by Owner, Owner’s
national purchasing agreements, where applicable.

 

3.7           Alterations,
Repairs and Maintenance.

 

(a)          Budgeted
Repairs/Emergency Repairs. Property Manager shall, at Owner’s expense, perform or cause to be performed all necessary
or desirable repairs, maintenance, cleaning, painting and decorating, alterations, replacements and improvements in and to the
Project as are customarily made by property managers in the operation of properties of the kind, size and quality of the Project;
provided, however, that no unbudgeted alterations, additions or improvements involving a fundamental change in the character of
the Project or constituting a major new construction program shall be made without the prior written approval of Owner. In addition,
no unbudgeted expenditure in excess of $25,000 per item or a total of $75,000 in any Fiscal Year shall be made for such purposes
without the prior written approval of Owner. However, emergency repairs involving manifest danger to life or property, or immediately
necessary for the preservation or the safety of the Project, or for the safety of the residents of the Project, or required to
avoid the suspension of any necessary service to the Project, or required by any judicial or governmental authority having jurisdiction,
may be made by the Property Manager without prior approval and regardless of the cost limitations imposed by this Section 3.7(a).
Property Manager shall as soon as practicable give written notice to Owner of any such emergency repairs for which prior approval
is not required.

 

    	5

    	 

    

 

(b)          Capital
Improvements. In accordance with the terms of the approved Budget or upon written request and approval of Owner, Property Manager
shall, from time to time during the Term hereof, at Owner’s expense, supervise the performance of all required capital improvements,
replacements or repairs to the Project but nothing herein shall be deemed to require Property Manager to serve as a construction
manager or general contractor for such improvements or repairs or replacements nor shall Property Manager have any responsibility
for any of the work performed in connection with such improvements or repairs or replacements. If Property Manager is required
to perform extraordinary services in connection with such improvements, repairs or replacements, Property Manager shall be entitled
to a Capital Improvement management fee in an amount to be negotiated in good faith by the parties hereto at such time.

 

(c)          Defects
and Warranties. Property Manager shall give Owner written notice of any material defect, casualty or a taking in the Project
and all parts thereof known to Property Manager promptly after any of the foregoing comes to Property Manager’s attention,
including, without limitation, material defects in the roof, foundation or walls of the Project or in the sewer, water, electrical,
structural, plumbing, heating, ventilation or air conditioning systems. Property Manager shall make periodic visual inspections
of the Project consistent with its on-site employees’ expertise.

 

3.8           Licenses
and Permits. Property Manager shall, at Owner’s expense, obtain and maintain in the name of Owner all licenses and permits
required of Owner or Property Manager in connection with the management and operation of the Project. Owner agrees to execute and
deliver any and all applications and other documents and to otherwise cooperate with Property Manager in applying for, obtaining
and maintaining such licenses and permits.

 

3.9           Compliance
with Laws. Property Manager shall comply with all applicable laws, regulations and requirements of any federal, state or municipal
government having jurisdiction with respect to the maintenance or operation of the Project by Property Manager in accordance with
its obligations under this Agreement.

 

3.10         Legal
Proceedings. Property Manager may, to the extent permitted by law, terminate a lease, lock out a tenant, and institute proceedings
for recovery of possession, in the ordinary course of business, without the prior written approval of Owner. Property Manager may
institute suit for rent or damages against a tenant without the prior written approval of Owner. All such suits or proceedings
shall, to the extent permitted by law, be brought in the name of Property Manager, as agent for Owner, and shall be handled as
determined by Property Manager. Owner shall pay all expenses incurred by Property Manager, including, but not limited to, reasonable
attorney’s fees and any liability, fines, penalties or the like, in connection with any claim, proceeding, or suit involving
an action against a tenant or an alleged violation by the Property Manager or Owner, or both, of any law pertaining to fair employment,
fair credit reporting, environmental protection, rent control, taxes, or fair housing, including, but not limited to, any law prohibiting
or making illegal discrimination on the basis of race, sex, family status, creed, color, religion, national origin, or mental or
physical handicap; provided, however, that Owner shall not be responsible to Property Manager for any such expenses in the event
Property Manager is finally adjudged to have violated any such law. Nothing contained in this Agreement shall obligate Property
Manager to employ legal counsel to represent Owner in any such proceeding or suit. Owner shall pay reasonable expenses incurred
by Property Manager in obtaining legal advice required in Property Manager’s reasonable discretion.

 

    	6

    	 

    

 

3.11         Inventory.
Property Manager shall maintain a current inventory of all equipment, supplies, furnishings, furniture and all other items of personal
property now or hereafter owned by Owner and located upon or used, or useful for, or necessary or adapted for the operation and
maintenance of the Project.

 

3.12         Signs.
Owner agrees to allow Property Manager to place one or more signs on or about the Project stating that Property Manager is the
management and leasing agent for the Project. All such signs and locations thereof shall be subject to Owner’s prior approval,
not to be unreasonably withheld.

 

3.13         Property
Manager’s Offices. Owner shall provide to Property Manager, at Owner’s expense, an office in the Project of a size
and in a location appropriate for the conduct of Property Manager’s duties under this Agreement.

 

3.14         Limitation
of Liability. Property Manager assumes no liability whatsoever for any acts or omissions of Owner, or any previous owners of
the Project, or any previous management or other agent of either (other than Property Manager and affiliates of Property Manager).
Property Manager assumes no liability for any failure of, or default by, any tenant in the payment of any rent or other charges
due Owner or in the performance of any obligations owed by any tenant to Owner pursuant to any lease or otherwise. Except to the
extent resulting from the gross negligence or willful act or omission of Property Manager, Property Manager assumes no liability
for any violations of environmental or other regulations which may occur during the period this Agreement is in effect. Any such
regulatory violations or hazards discovered by Property Manager shall be promptly brought to the attention of Owner in writing.

 

Article
IV FEES

 

4.1           Management
Fee. As consideration for the performance by Property Manager of its services under this Agreement, Owner agrees to pay to
Property Manager for each month during the Term of this Agreement a property management fee (the “Management Fee”)
equal to four (4%) percent [VERIFY] of Gross Receipts for such month. If at any time during the Term, the Property
Manager elects to subcontract all day to day, on site management, leasing and related functions for the Project (the “Property
Sub Manager”), then the Management Fee to be payable to Property Manager thereafter shall be equal to the Property Sub Manager
Fee (as defined below), plus an override equal to one (1%) percent of Gross Receipts for such month. Thus, under such circumstances,
all Management Fees shall be payable to Property Manager, from which the Property Manager shall be responsible to pay the Property 
Sub Manager a market rate monthly fee based on the Gross Receipts for such month (the “Property Sub Manager Fee”).
The Property Manager will enter into a written contract with its Property Sub Manager, through which the Property Manager may delegate
some or all of its duties under this Agreement.

 

The term “Gross
Receipts” shall mean and include all gross receipts derived from the operation of the Project, including, without limitation,
all rent and other sums and charges received from all prospective tenants, tenants and lessees and payments made in consideration
of the cancellation of any tenant leases or damages by reason of any default, security deposits to the extent applied to rent,
tenant application fees, the proceeds from rental interruption insurance, receipts from vending machines, concessions and other
commercial operations conducted on the Project, and income derived from interest on investments. “Gross Receipts” shall
not include sums which, under normal accounting practice, are attributable to capital, proceeds of claims on account of insurance
policies other than rental interruption or similar insurance, the abatement of taxes, awards arising out of taking by eminent domain,
discounts and dividends on insurance policies, or any sums received by Property Manager as reimbursement or recovery of items of
expense charged to the Owner, such as court costs paid by defaulting tenants, utility rebates, security deposits (to the extent
applied to damage) and the like, all of which shall be applied as offsets against the corresponding items of expense. The Owner
hereby acknowledges that the Management Fee is fair and reasonable for the services to be performed by Property Manager under this
Agreement.

 

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4.2           Payment
of Management Fee. Provided that Property Manager is not in default under this Agreement, Property Manager shall be entitled
to pay itself the monthly Management Fee from the bank accounts referred to in Section 5.1 hereof. However, in the event
of a default under that certain Loan Agreement with the Owner’s secured lender (“Lender”) and any other documents
entered into in connection with the Loan Agreement (together with the Loan Agreement, the “Loan Documents”), Lender
may have the right to compel the Owner to suspend payment of the Management Fee. If such suspension of payments occurs, the Property
Manager shall have the right to immediately terminate this Agreement.

 

4.3           Accrual
of Management Fee. Notwithstanding anything herein to the contrary, Property Manager may elect (but shall not be required to
do so), upon request by Owner, to allow Owner to forego making the monthly Management Fee payments owing hereunder for a mutually-agreeable
period, without same constituting a default by Owner hereunder. Any Management Fees not paid when owing under such circumstances
shall accrue as an obligation of Owner hereunder (collectively, the “Accrued Fees”) unless Property Manager elects
in writing to allow same to not accrue but rather to be forgiven.

 

4.4           Additional
Compensation. In addition to the compensation provided to the Property Manager in this Section 4, Property Manager shall be
entitled to compensation for such specific additional services as may be agreed upon, including, without limitation, adjustment
of fire claims, condemnation claims and construction services beyond the normal course of business.

 

4.5           Disposition
Fee. If following the date hereof the Project is sold, then the Property Manager shall receive a disposition fee (herein, the
“Disposition Fee”) at the closing of such sale, in cash, in an amount equal to three percent (3%) [VERIFY] of
the gross purchase price paid in connection with such sale; provided, however, that no such Disposition Fee (or other fee) shall
be owing in the event of any foreclosure sale, any acquisition of the Project by the Lender (or any designee of Lender) or any
subsequent sale after such foreclosure sale or acquisition by Lender (or Lender’s designee). If there is a broker fee paid
to a third-party broker in connection with a sale, exchange or other disposition of the Project, the payment to the third-party
broker will be paid in addition to the Disposition Fee paid to the Property Manager, but in no event may the aggregate of such
third-party brokerage fee and the Disposition Fee exceed 4.5% of the gross purchase price paid in connection with such sale.
At the completion of such sale, exchange or other disposition, this Agreement shall automatically terminate.

 

Article
V PROCEDURE FOR

HANDLING RECEIPTS

 

5.1           Receipts
and Disbursements. All monies received by Property Manager for or on behalf of Owner in connection with the operation or management
of the Project shall be promptly deposited by Property Manager in a bank account or accounts established by Property Manager (collectively,
the “Operating Account”). Property Manager shall withdraw and pay from the Operating Account such amounts at such times
as the same are required in connection with the management and operation of the Project in accordance with the provisions of this
Agreement. All monies in the Operating Account are the property of Owner, to be held by Property Manager in trust for Owner in
an account designated as “Agent for Owner” and disbursed in accordance with this Agreement. A separate account for
tenant security deposits shall be established if required by applicable law or Owner.

 

5.2           Authorized
Signatories. Designated officers and representatives of Property Manager shall be authorized signatories on the Operating Account
and shall have authority to make withdrawals from the Operating Account, subject to the terms of this Agreement. Property Manager
shall maintain insurance under a policy acceptable to Owner for employee errors, omissions and fidelity coverage (covering, without
limitation, losses due to theft or embezzlement) for not less than $1,000,000 per occurrence and crime coverage for not less than
$1,000,000 per occurrence. Any changes in such insurance must be approved by Owner.

 

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Article
VI ACCOUNTING

 

6.1           Books
and Records. Property Manager shall maintain on a modified cash basis at the corporate office of Property Manager, a comprehensive
system of office records, books and accounts pertaining to the Project. On 48 hours’ prior written notice to Property Manager,
all books and records relating to the Project shall be available for examination and copying by Owner and its agents, accountants
and attorneys during regular business hours. Property Manager shall preserve all records, books and accounts for the period required
by applicable law and at the end of such period shall deliver or make available to Owner such records. All such records (including,
without limitation, rent rolls and other revenue reports, accounts payable, financial statements, and related accounting records)
shall, at all times, be the property of Owner.

 

6.2           Periodic
Statements; Audits.

 

(a)          Monthly
Statements. On or before the 25th day of each calendar month, Property Manager shall deliver or cause to be delivered to Owner
(i) reports for the prior calendar month and for the Fiscal Year-to-date, and (ii) such other reports as Owner may reasonably request.

 

(b)          Audit.
In the event that Owner requires an audit, it will be at Owner’s expense. The Property Manager shall reasonably cooperate
with the auditors.

 

(c)          Other
Statements. Owner may request, and Property Manager shall provide, such weekly, monthly, quarterly and/or annual leasing and
management reports that relate to the operations of the Project as Owner may reasonably request in writing.

 

Article
VII INSURANCE

 

7.1           Insurance
and Indemnities.

 

(a)          Coverages.
Property Manager shall, at its own expense, procure and keep in effect during the Term of this Agreement, property and casualty
insurance, comprehensive general liability insurance and other insurance coverages as required (and with limits as required) by
Lender as provided in the Loan Documents, which insurance shall be primary in all instances. Owner shall be included as a party
to be given copies of all notices under the liability insurance policies. Owner will be covered as an additional insured in the
comprehensive general liability insurance policies maintained with respect to the Project.

 

Property Manager will
provide the Owner with certificates of insurance or other satisfactory documentation, which evidence that the insurance required
under this Agreement is in full force and effect at all times. All policies required under this Agreement must be endorsed to provide
that 30 days’ advance notice of cancellation (10 days’ advance notice for non-payment of premium) or material change
will be given to Owner. All insurance required hereunder shall: (i) be written with companies acceptable to Owner, which companies
shall be licensed to do business in the state in which the Project is located, and (ii) include a clause providing that the insurer
waives all rights of subrogation against Owner with respect to losses payable under such policies.

 

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The Owner shall furnish
whatever information is reasonably requested by Property Manager for the purpose of establishing the placement of insurance coverages
described herein and shall aid and cooperate in every reasonable way with respect to such insurance and any loss thereunder. Property
Manager shall include in its property and casualty insurance policy covering the Project, the personal property, fixtures, and
equipment located thereon (whether owned by Property Manager or Owner), appropriate clauses pursuant to which the insurance carriers
shall waive the rights of subrogation with respect to losses payable under such policies.

 

(b)          Property
Manager Indemnity. The Property Manager shall indemnify, defend (with counsel reasonably satisfactory to Owner) and save Owner
harmless from and against any and all claims arising from Property Manager’s and its officers’, directors’, members’,
managers’, shareholders’, agents’, contractors’, representatives’ or employees’ intentional
or willful acts or gross negligence in performing its responsibilities hereunder and from and against all costs, reasonable attorneys’
fees, expenses and liabilities incurred in the defense of any claim or any action or proceeding brought as a result of any such
claim.

 

(c)          Owner
Indemnity. Property Manager agrees:

 

(i)          to
notify Owner within five (5) business days after Property Manager receives notice of any loss, damage, or injury occurring
on or about the Project;

 

(ii)         to
take no action (such as admission of liability) which bars Owner from obtaining any protection afforded by any insurance policy
Owner may hold (or under which Owner can make a claim); and

 

(iii)        that
Owner shall have the exclusive right to conduct the defense to any claim, demand, or suit within limits prescribed by such policy
or policies of insurance.

 

Provided Property Manager
complies with the provisions of this paragraph (c), Owner shall indemnify, defend and save Property Manager harmless from all loss,
damage, cost, expense (including attorneys’ fees), liability, or claims for personal injury or property damage incurred or
occurring in, on, or about the Project, except for any losses brought about by the intentional or willful acts or gross negligence
on the part of the Property Manager, its officers, directors, members, managers, shareholders, agents, contractors, representatives
or employees.

 

Owner does hereby agree,
to the fullest extent permitted by law, to indemnify, defend and save Property Manager harmless from and against any injuries to
person (including, without limitation, death) occurring at any time, any loss, damage, and expense to property (including, without
limitation, loss of use thereof), and any claim, cost, penalty, fine, order of injunctive relief, expense or liability of any nature
(including, without limitation, actual attorneys’ fees, fees of environmental consultants and laboratory fees, and any other
costs incurred in the investigation, defense and settlement of claims, and natural resource damages) caused by, arising out of,
resulting from or occurring in connection with, wholly or in part, and whether in time prior to, after or the date of this Agreement,
the alleged exposure to or alleged presence, disposal, release or threatened release of any Regulated Substance (as hereinafter
defined) from, at or about the Project or attributable, in whole or in part, to Owner’s action or inaction or the action
or inaction of Owner’s employees, agents, contractors, lessees or invitees or trespassers (other than the Property Manager)
and any condition caused by or which may be attributable to any Regulated Substance, other than those caused by the gross negligence
or willful act or omission of Property Manager, its officers, directors, members, managers, shareholders, agents, contractors,
representatives or employees.

 

    	10

    	 

    

 

The term “Regulated
Substance” as used herein means (a) any substance, material, or waste that is regulated under any federal, state, or local
statute, regulation, ordinance, guidance, or order pertaining to environmental protection or the protection of the public health,
safety and/or welfare, including, without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act
of 1980,42 U.S.C. § 9601 et seq. the Solid Waste Disposal Act, 42 U.S.C. § 6901 et seq.;
the Clean Air Act, 42 U.S.C. § 7401 et seq. the Federal Water Pollution Control Act, 33 U.S.C. § 125 1-1387;
the Emergence Planning and Community Right-to-Know Act, 42 U.S.C. § 1101 et seq. the Hazardous Materials Transportation Act,
49 U.S.C. § 1801 et seq. the Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. § l36-136y;
and the Toxic Substances Control Act, 15 U.S.C. § 2601-2692; and such statute, regulation, ordinance, or order as now amended
or hereafter may be amended; and (b) any substance whatsoever that may pose, now or hereafter, a threat of risk of harm to human
health, the environment, or the soils, geologic materials, air, surface water, or groundwater, including, without limitation, the
presence or release of radon, noxious or nuisance gases or particles, asbestos or asbestos-containing material, equipment or material
containing or consisting of poly- or mono-chlorinated biphenyls, fiberglass, formaldehyde, urea formaldehyde foam, lead, petroleum
and petroleum products, or natural gas or natural gas products.

 

7.2           Survival.
The provisions of this Article 7 shall survive any cancellation, termination or expiration of this Agreement and shall remain in
full force and effect until such time as the applicable statute of limitations shall have expired for all demands, claims, actions,
damages, losses, liabilities or expenses which are the subject of the provisions of this Article 7.

 

Article
VIII DEFAULT; TERMINATION

 

8.1           Default.
Upon the occurrence of any default under this Agreement by a party (“defaulting party”), and after giving notice of
default and opportunity to cure as provided below, the non-defaulting party shall be entitled to terminate this Agreement immediately
in addition to any remedy such party may have at law or in equity. A defaulting party shall be entitled to cure (i) a monetary
default within five (5) days after receipt of written notice of such default, or, (ii) a non-monetary default within fifteen (15)
days after receipt of written notice of such default, provided that the defaulting party proceeds to diligently cure such default
upon receipt of such notice.

 

8.2           Bankruptcy,
Insolvency.

 

(a)          If
either party shall file a petition in bankruptcy or for a reorganization or arrangement or other relief under the United States
Bankruptcy Code or any similar statute, or if any such proceeding shall be filed against either party and is not dismissed or vacated
within 60 days after its filing, or if a court having jurisdiction shall issue an order or decree appointing a receiver, custodian
or liquidator for a substantial part of the property of either party which decree or order remains in force undischarged and unstayed
for a period of 60 days, or if either party shall make an assignment for the benefit of creditors or shall admit in writing its
inability to pay its debts as they become due, the other party may terminate this Agreement upon 5 days written notice.

 

(b)          Owner
and Property Manager have entered into this Agreement in reliance upon the unique knowledge, experience and expertise of the other
party and in reliance upon the duties of loyalty and confidentiality which each party hereby agrees to undertake. Except as otherwise
expressly provided in this Agreement, neither party shall be required to accept performance under this Agreement from any person,
including, without limitation, Owner or Property Manager, as the case may be, should it become a debtor in possession under the
United States Bankruptcy Code, or any trustee of either appointed under the United States Bankruptcy Code and any assignee of such
party or trustee, other than the other party hereto.

 

8.3           Sale
of Project. This Agreement shall automatically terminate upon any sale of the Project.

 

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Article
IX SUBORDINATION TO MORTGAGES

 

9.1           Subordination.
This Agreement and Property Manager’s interest and rights hereunder are and shall be subject and subordinate at all times
to the lien of any mortgage, whether now existing or hereafter created on or against the Project, and all amendments, restatements,
renewals, modifications, consolidations, refinancings, assignments and extensions thereof (“Security Documents”) without
the necessity of any further instrument or act on the part of the Property Manager. Property Manager agrees, at the election of
the holder of any such Security Documents (the “Secured Party”), to attorn to the Secured Party. The term “mortgage”
as used herein shall be deemed to include deeds of trust, security assignments and any other similar encumbrances, and any reference
to the “holder” of a Security Document shall be deemed to include the beneficiary under a deed of trust. Notwithstanding
the foregoing, nothing herein shall obligate the Property Manager to continue its performance under this Agreement unless it has
been paid, and continues to be paid, in accordance with the terms of this Agreement. As provided above, Property Manager acknowledges
and agrees, without limitation, that Lender is a Secured Party and that the Loan Documents to which the Owner is a party constitutes
one of the Security Documents. 

 

9.2           Rights
after Events of Default. Upon an Event of Default (as such term is defined in any Security Document), and provided that it
continues to be paid in accordance with the terms of this Agreement, the Property Manager shall continue to perform its obligations
under this Agreement until the earlier to occur of (a) the termination of this Agreement with respect to the Project or the termination
of this Agreement in accordance with the terms hereof, or (b) the Secured Party’s (or its assignee’s or nominee’s)
acquisition of title to the Project through foreclosure, a deed-in-lieu thereof, or otherwise. On and after an Event of Default,
there shall be no material changes in the terms and conditions of this Agreement without the prior written consent of the Secured
Party.

 

Article
X MISCELLANEOUS PROVISIONS

 

10.1         Notices.
All notices, demands, requests or other communications which may be or are required to be given, served or sent by either party
to the other hereunder, shall be in writing and delivered personally or by recognized national courier service, return receipt
requested or certified mail, return receipt requested, with postage prepaid, to the Property Manager, and to the Owner, at the
addresses set forth below with copies addressed as set forth below:

 

		if to the Owner, to:	BR – NPT Springing Entity, LLC

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

Heron Tower

70 East 55th Street, 9th Floor

New York, NY 10022

Attn: R. Ramin Kamfar

 

		if to the Property Manager, to:	Bluerock Property Management,
LLC

27777 Franklin Road

Suite 900

Southfield, Michigan 48034

Attn: Ms. Patricia Anderson

 

The parties may change the name and/or
address provided above by written notice given as aforesaid. Notices shall be deemed effective upon receipt (with refusal of delivery
being deemed a receipt). In emergency situations, the Property Manager shall endeavor to also fax notices to the addresses set
forth above, but any such faxed notice shall not constitute an effective notice under this Agreement.

 

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10.2         Severability.
If any term, covenant or condition of this Agreement or the application thereof to any person or circumstance shall, to any extent,
be held to be invalid or unenforceable, the remainder of this Agreement, or the application of such term, covenant or condition
to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and
each term, covenant or condition of this Agreement shall be valid and shall be enforced to the fullest extent permitted by law.

 

10.3         No
Joint Venture or Partnership. Owner and Property Manager hereby renounce the existence of any joint venture or partnership
between them and agree that nothing contained herein or in any document executed in connection herewith shall be construed as making
Property Manager and Owner joint venturers or partners. Property Manager acknowledges and agrees that Property Manager is engaged
only as an independent contractor in the business of managing multifamily projects.

 

10.4         Entire
Agreement and Amendment. This Agreement constitutes the entire agreement between the parties hereto with respect to the subject
matter hereof. This Agreement may be amended or modified only by a written instrument executed by Property Manager and Owner.

 

10.5         Article
and Section Headings. Article and Section headings contained in this Agreement are for reference only and shall not be deemed
to have any substantive effect or to limit or define the provisions contained herein.

 

10.6         Successors
and Assigns. This Agreement shall be binding on the parties hereto, and their successors and permitted assigns. Neither party
may assign or otherwise transfer its interest hereunder without the prior written consent of the other party, which consent may
be withheld in such party’s sole discretion.

 

10.7         Attorneys’
Fees. Should either party employ attorneys to enforce any of the provisions hereof, the party losing in any final judgment
agrees to pay the prevailing party all reasonable costs, charges and expenses, including attorneys’ fees, expended or incurred
in connection therewith.

 

10.8         Governing
Law. This Agreement shall be construed in accordance with the internal laws of the State where the Project is located.

 

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

 

10.10        Confidentiality.
Property Manager shall maintain the confidentiality of all matters pertaining to this Agreement and all operations and transactions
relating to the Project.

 

10.11        Time.
Time is of the essence in the performance of this Agreement.

 

10.12        Corporate
Authority of Property Manager. Property Manager represents and warrants that (a) Property Manager is a limited liability company
duly organized and validly existing and is in good standing under the laws of the State of Michigan; and (b) Property Manager has
full power, authority and legal right to execute, deliver and perform this Agreement and to perform all of its obligations hereunder.

 

10.13        Corporate
Authority of Owner. Owner represents and warrants that (a) Owner is a limited liability company, duly organized and validly
existing and is in good standing under the laws of the State of Delaware and (b) Owner has full power, authority and legal right
to execute, deliver and perform this Agreement and to perform all of its obligations hereunder.

 

    	13

    	 

    

 

IN WITNESS WHEREOF,
this Agreement has been duly executed and delivered as of the date first above written.

 

	 	PROPERTY MANAGER
	 	 
	 	BLUEROCK PROPERTY MANAGEMENT, LLC, 
	 	a Michigan limited liability company
	 	 	 
	 	By:	Bluerock Real Estate, L.L.C.,
	 	 	a Delaware limited liability company, its Manager
	 	 	 
	 	 	By:	/s/
    Jordan Ruddy
	 	 	Name: 	Jordan Ruddy
	 	 	Title: 	Authorized Signatory
	 	 	 
	 	OWNER:
	 	 
	 	BR – NPT SPRINGING ENTITY, LLC, 
	 	a Delaware limited liability company
	 	 	 
	 	By:	BR – North Park Towers, LLC, 
	 	 	a Delaware limited liability company, its Manager
	 	 	 
	 	 	By:	/s/ Jordan Ruddy
	 	 	Name: 	Jordan Ruddy
	 	 	Title: 	Authorized Signatory

 

    	14

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