Document:

exhibit45subscriptionagr

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 1/12   We, Preferred Apartment Communities, Inc., are selling up to a maximum of $1,000,000,000 in connection with this offering (the ‘‘Offering’’).   Your broker-dealer or registered investment advisor should MAIL properly completed and executed ORIGINAL documents, along with   your check payable to ‘‘UMB Bank N.A., Escrow Agent for Preferred Apartment Communities, Inc.’’ to UMB Bank, National Association   at the following address or with a wire using the following instructions:   *For IRA Accounts, mail investor signed documents to the IRA Custodian for signatures.   InstructIons to subscrIbers   Section 1: Indicate investment amount (make all checks payable to “UMB Bank N.A., Escrow Agent for Preferred Apartment Communities,   Inc.”)   Section 2: Choose type of ownership   non-custodIal ownershIp   — Accounts with more than one owner must have ALL PARTIES SIGN where indicated on page 7.   — Be sure to attach copies of all plan documents for Pension Plans, Trusts or Corporate Partnerships required in Section 2.   custodIal ownershIp   For New IRA/Qualified Plan Accounts, please complete the form/application provided by your custodian of choice in addition to this   subscription document and forward to the custodian for processing.   For existing IRA Accounts and other Custodial Accounts, information must be completed BY THE CUSTODIAN.   Have all documents signed by the appropriate officers as indicated in the Corporate Resolution (which   are also to be included).   Section 3: All names, addresses, dates of birth, Social Security or Tax I.D. numbers of all investors or Trustees   Section 4: Choose Dividend Allocation option   Section 6: To be signed and completed by your Financial Advisor (be sure to include CRD number for Financial Advisor and Broker Dealer   Firm and the Branch Manager’s signature)   Section 7: Have ALL investors initial and sign where indicated   Section 8: All investors must complete and sign the substitute W- 9   SubScription Agreement  inStruction pAge   AddRESS:   UMB Bank, National Association   1010 Grand Boulevard, 4th Floor   Mail Stop: 1020409   Kansas City, Missouri 64106   Attention: Lara Stevens, Corporate Trust   Phone: (816) 860-3017   Fax: (816) 860-3029   MAILING AddRESS FOR dOCUMENTS: UMB Bank, National Association   1010 Grand Boulevard, 4th Floor   Mail Stop: 1020409   Kansas City, Missouri 64106   WIRE INSTRUCTIONS:   UMB Bank, N.A.   ABA No: 101000695   Acct No: 9800006823   Acct Name: Trust Clearance   Reference: 138242 Preferred Apt Communities Attn: Lara Stevens        

 

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 2/12   SubScription Agreement   Individual   Joint Tenant - Joint accounts will be registered as joint tenants   with rights of survivorship unless otherwise indicated   Tenants in Common   TOD - Optional designation of beneficiaries for individual joint   owners with rights of survivorship or tenants by the entireties.   (Please complete Transfer on Death Registration Form which you   can obtain from the Preferred Apartments Communities Sales Desk)   Corporation or Partnership - Authorized signature required.   Include Corporate Resolution or Partnership Agreement, as   applicable   Uniform Gift/Transfer to Minors - (UGMA/UTMA)   Pension or Other Retirement Plan - Include Plan   Documents   Trust - Include title and signature pages of Trust Documents   Other   (Include title and signature pages)   ThIRd PARTY AdMINISTEREd CUSTOdIAL PLAN   (New IRA accounts will require an additional application)    IRA ROTH/IRA    Simple Employee Pension (S.E.P.) IRA SIMPLE    OTHER (Specify):   CUSTOdIAN INFORMATION   (To be completed by Custodian above)   Name of Custodian:   Mailing Address:   City, State, ZIP:   Custodian Tax ID#:   Custodian Account #:   Custodian Phone #:   1. Investment   2. FORm OF OWneRsHIp   I/We am/are directors, officers, employees or other individuals associated with the company or a family member of one   of the foregoing.   (Please choose one option within the ‘‘Non-Custodial Ownership” column, or   within the ‘‘Custodial Ownership’’ column)   NON-CUSTODIAL OWNERSHIP CUSTODIAL OWNERSHIP   NOTE: Cash, cashier’s checks/official bank checks in bearer form, foreign checks, money orders, third party checks, or traveler’s   checks will not be accepted.   Payment Instructions: Make all checks payable to ‘‘UMB Bank N.A., Escrow Agent for Preferred Apartment Communities, Inc.’’   Under the UGMA/UTMA   of the State of   UMB Bank, National Association   1010 Grand Boulevard, 4th Floor   Mail Stop: 1020409   Kansas City, Missouri 64106   Number of units purchased:   Purchase price per unit:   Aggregate purchase price:   Brokerage Account Number (If Applicable):   $   $   Check here if additional purchase and complete the inestor information on Page 7.    

 

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 3/12   First Name:   Last Name:   Street Address:   City:   Date of Birth:   First Name:   Last Name:   Street Address:   City:   Date of Birth:   Street Address:   City:   Daytime Phone #:   U.S. Driver’s License #:   (if applicable)   Issue Date:   Daytime Phone #:   U.S. Driver’s License #:   (if applicable)   Issue Date:   If Non-U.S. Citizen, specify Country of Citizenship:   If Non-U.S. Citizen, specify Country of Citizenship:   Middle Name:   Tax ID or SS#:   Middle Name:   Tax ID or SS#:   Email address:   State of Issue:   Expiration Date:   Email address:   State of Issue:   Expiration Date:   State:   State:   State:   /   /   /   /   ZIP:   ZIP:   ZIP:   3. InvestOR InFORmAtIOn (Please print name(s) in which Units are to be registered.)   A.  Investor/Trustee   B.  Co-Investor/Co-Trustee   C.  Residential Street Address (This section must be completed for verification purposes if mailing address in Section 3A is a P.O. Box)    

 

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 4/12   City:   Country:   Permanent Resident   U.S. Driver’s License   Retired   Employment Authorization Document   Passport without U.S. Visa   Foreign national identity documents   INS Permanent resident alien card Passport with U.S. Visa   Non-Permanent Resident Non-Resident   State/Providence:place of birth   Immigration status   D.  Trust/Corporation/Partnership/Other   E.  Government ID   F.    (Trustee’s information must be provided in Sections 3A and 3B)   (Foreign Citizens only) Identification documents must have a reference number and photo. Please attach photocopy.   Date of Trust:   Entity Name/Title of Trust:   Tax ID Number:   Employer:   Number for the document checked above:   Country of issuance:   Check which type of document you are providing:   / /   Bank Name:   (Required)   Bank Address:   (Required)   Account #:   (Required)   Bank Phone #:   (Required)    

 

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 5/12   4. DIstRIBUtIOns   5. eLeCtROnIC DeLIveRY eLeCtIOn   (Select only one; If nothing is marked, will default to “Credit Dividend to Custodian (including IRA) or   Clearing Firm/Platform of Record” or “Mail Check to the Address of Record,” as applicable)   I hereby subscribe for Units of Preferred Apartment Communities, Inc. and elect the distribution option indicated below:   FOR CUSTODIAL OR CLEARING FIRM/PLATFORM ACCOUNTS:   Credit Dividend to Custodian (including IRA) or Clearing Firm/Platform of Record   FOR NON-CUSTODIAL OR NON-CLEARING FIRM/PLATFORM ACCOUNTS:   Mail Check (to the Address of Record)   Cash/Direct Deposit (Please attach a pre-printed voided check (Non-Custodian Investors only)).   I authorize Preferred Apartment Communities, Inc. or its agent to deposit my distribution/dividend to my checking or   savings account. This authority will remain in force until I notify Preferred Apartment Communities, Inc. in writing to cancel   it. If Preferred Apartment Communities, Inc. deposits funds erroneously into my account, they are authorized to debit my   account for an amount not to exceed the amount of the erroneous deposit.   Check the box if you consent to the electronic delivery of documents, including the prospectus, prospectus   supplements, annual and quarterly reports, and other stockholder communication and reports. E-mail   address in Section 3 is required. Please carefully read the following representations before consenting to   receive documents electronically. By checking this box and consenting to receive documents electronically,   you represent the following:   (a)  I acknowledge that access to both Internet e-mail and the World Wide Web is required in order to access documents electronically. I   may receive by e-mail notification the availability of a document in electronic format. The notification e-mail will contain a web address   (or hyperlink) where the document can be found. By entering this address into my web browser, I can view, download and print the   document from my computer. I acknowledge that there may be costs associated with the electronic access, such as usage charges from my   Internet provider and telephone provider, and that these costs are my responsibility.   Complete this section to elect how to receive your dividend distributions.   IRA accounts may not direct distributions without the custodian’s approval.   PLEASE ATTACH COPY OF VOIDED CHECK TO THIS FORM IF FUNDS ARE TO BE SENT TO A BANK   * The above services cannot be established without a pre-printed voided check. For electronic funds transfers, signatures of bank ac-   count owners are required exactly as they appear on the bank records. If the registration at the bank differs from that on this Subscrip-   tion Agreement, all parties must sign below.   Name/Entity Name/Financial Institution:   Mailing Address:   City:   Your Account #:   Your Bank’s Account #:   Owner Signature:   Co-owner Signature:   (If applicable)   Date:   Date:   State: ZIP:   Your Bank’s  ABA/Routing #:   Checking Account Savings Account   /   /   /   /    

 

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 6/12   (b)   I acknowledge that documents distributed electronically may be provided in Adobe’s Portable Document Format (PDF). The Adobe   Reader software is required to view documents in PDF format. The Reader software is available free of charge from Adobe’s web site at   www.adobe.com. The Reader software must be correctly installed on my system before I will be able to view documents in PDF format.   Electronic delivery also involves risks related to system or network outage that could impair my timely receipt of or access to stockholder   communications.   (c)  I acknowledge that I may receive at no cost from Preferred Apartment Communities, Inc. a paper copy of any documents delivered   electronically by calling my Financial Advisor.   (d)  I understand that if the e-mail notification is returned to Preferred Apartment Communities, Inc. as ‘‘undeliverable,’’ a letter will be   mailed to me with instructions on how to update my e-mail address to begin receiving communication via electronic delivery. I further   understand that if Preferred Apartment Communities, Inc. is unable to obtain a valid e-mail address for me, Preferred Apartment   Communities, Inc. will resume sending a paper copy of its filings by U.S. mail to my address of record.   (e)  I understand that my consent may be updated or cancelled, including any updates in e-mail address to which documents are delivered, at   any time by calling my Financial Advisor.   6. BROKeR-DeALeR/FInAnCIAL ADvIsOR InFORmAtIOn (All fields must be completed)   The Financial Advisor must sign below to complete order. The Financial Advisor hereby represents and warrants that he/she is duly   licensed and may lawfully sell units of Preferred Apartment Communities, Inc.   Broker-Dealer:   Financial Advisor Name/RIA:   Mailing Address:   City:   Business Phone #:   (Required)   Email Address:   Broker-Dealer CRD #:   Financial Advisor CRD  #:   Fax #:   State: ZIP:   RIA Submission Check this box to indicate whether submission is made through the Registered Investment Advisor (RIA) in its capacity as   the RIA and not in its capacity as a Registered Representative of a Broker-Dealer, if applicable, whose agreement with the subscriber includes a   fixed or ‘‘wrap’’ fee feature for advisory and related brokerage services. I understand that by checking the above box, I will not receive a selling   commission.   The undersigned further represents and certifies that in connection with this subscription for units, he/she has complied with and has followed   all applicable policies and procedures under his firm’s existing Anti-Money Laundering Program and Customer Identification Program.   Financial Advisor and /or RIA Signature:   Branch Manager Signature:   Date:   Date:   /   /   /   /    

 

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 7/12   7. sUBsCRIBeR ACKnOWLeDgements AnD sIgnAtURes   The undersigned hereby confirms her/his/its agreement to purchase the units on the terms and conditions set forth herein and acknowledges   and/or represents (or in the case of fiduciary accounts, the person authorized to sign on such subscriber’s behalf) the following: (you must   initial each of the representations below)   WE INTEND TO ASSERT THE FOREGOING REPRESENTATIONS AS A DEFENSE IN ANY SUBSEQUENT LITIGATION WHERE   SUCH ASSERTION WOULD BE RELEVANT. WE HAVE THE RIGHT TO ACCEPT OR REJECT THIS SUBSCRIPTION IN WHOLE OR   IN PART, SO LONG AS SUCH PARTIAL ACCEPTANCE OR REJECTION DOES NOT RESULT IN AN INVESTMENT OF LESS THAN   THE MINIMUM AMOUNT SPECIFIED IN THE PROSPECTUS. AS USED ABOVE, THE SINGULAR INCLUDES THE PLURAL IN ALL   RESPECTS IF UNITS ARE BEING ACQUIRED BY MORE THAN ONE PERSON. THIS SUBSCRIPTION AGREEMENT AND ALL RIGHTS   HEREUNDER SHALL BE GOVERNED BY, AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK   WITHOUT GIVING EFFECT TO THE PRINCIPLES OF CONFLICT OF LAWS.   By executing this Subscription Agreement, the subscriber is not waiving any rights under federal or state law.   Signature of Custodian(s) or Trustee(s) (if applicable). Current Custodian must sign if investment is for an IRA Account   Owner Co-owner   a) I/We have received the final prospectus of Preferred Apartment   Communities, Inc.   Owner Co-owner   b) I/We accept the terms of the charter, as amended, of Preferred Apartment   Communities, Inc.   Owner Co-owner   d) I/We am/are in compliance with the USA PATRIOT Act and not on any   governmental authority watch list.   Owner Co-owner   c) I/We am/are purchasing Units for my/our own account.   Owner Signature:   Co-owner Signature:   Date:   Date:   /   /   /   /   Authorized Signature:   (Custodian or Trustee)   Date: / /    

 

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 8/12   8.  IRs FORm W-9   To prevent backup withholding on any payment made to a stockholder with respect to subscription proceeds held in escrow, the stockholder is   generally required to provide a current taxpayer identification number, or TIN (or the TIN of any other payee), and certain other information   by completing the form below, certifying that the TIN provided on Form W-9 is correct (or that such investor is awaiting a TIN), that the   investor is a U.S. person, and that the investor is not subject to backup withholding because (i) the investor is exempt from backup withholding,   (ii) the investor has not been notified by the IRS that the investor is subject to backup withholding as a result of failure to report all interest or   dividends or (iii) the IRS has notified the investor that the investor is no longer subject to backup withholding. If the box in Part 3 is checked   and a TIN is not provided by the time any payment is made in connection with the proceeds held in escrow, 28% of all such payments will   be withheld until a TIN is provided and if a TIN is not provided within 60 days, such withheld amounts will be paid over to the IRS. See the   instructions included with the Form W-9 below on how to fill out the Form W-9.     

 

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 9/12   Form    W-9   (Rev. December 2011)   Department of the Treasury    Internal Revenue Service   Request for Taxpayer   Identification Number and Certification   Give Form to the    requester. Do not   send to the IRS.   Print or type      Se   e Specific Instructions    on page 2   .   Name (as shown on your income tax return)   Business name/disregarded entity name, if different from above   Check appropriate box for federal tax classification:   Individual/sole proprietor  C Corporation S Corporation Partnership Trust/estate   Limited liability company. Enter the tax classification (C=C corporation, S=S corporation, P=partnership) ▶    Other (see instructions) ▶   Exempt payee   Address (number, street, and apt. or suite no.)   City, state, and ZIP code   Requester’s name and address (optional)   List account number(s) here (optional)   Part I Taxpayer Identification Number (TIN)   Enter your TIN in the appropriate box. The TIN provided must match the name given on the “Name” line   to avoid backup withholding. For individuals, this is your social security number (SSN). However, for a   resident alien, sole proprietor, or disregarded entity, see the Part I instructions on page 3. For other   entities, it is your employer identification number (EIN). If you do not have a number, see How to get a   TIN on page 3.   Note. If the account is in more than one name, see the chart on page 4 for guidelines on whose   number to enter.   Social security number   – –   Employer identification number   –   Part II Certification   Under penalties of perjury, I certify that:   1.  The number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me), and   2.  I am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue   Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am   no longer subject to backup withholding, and   3.  I am a U.S. citizen or other U.S. person (defined below).   Certification instructions. You must cross out item 2 above if you have been notified by the IRS that you are currently subject to backup withholding   because you have failed to report all interest and dividends on your tax return. For real estate transactions, item 2 does not apply. For mortgage   interest paid, acquisition or abandonment of secured property, cancellation of debt, contributions to an individual retirement arrangement (IRA), and   generally, payments other than interest and dividends, you are not required to sign the certification, but you must provide your correct TIN. See the   instructions on page 4.   Sign   Here   Signature of   U.S. person ▶ Date ▶   General Instructions   Section references are to the Internal Revenue Code unless otherwise   noted.   Purpose of Form   A person who is required to file an information return with the IRS must   obtain your correct taxpayer identification number (TIN) to report, for   example, income paid to you, real estate transactions, mortgage interest   you paid, acquisition or abandonment of secured property, cancellation   of debt, or contributions you made to an IRA.   Use Form W-9 only if you are a U.S. person (including a resident   alien), to provide your correct TIN to the person requesting it (the   requester) and, when applicable, to:   1. Certify that the TIN you are giving is correct (or you are waiting for a   number to be issued),   2. Certify that you are not subject to backup withholding, or   3. Claim exemption from backup withholding if you are a U.S. exempt   payee. If applicable, you are also certifying that as a U.S. person, your   allocable share of any partnership income from a U.S. trade or business   is not subject to the withholding tax on foreign partners’ share of   effectively connected income.   Note. If a requester gives you a form other than Form W-9 to request   your TIN, you must use the requester’s form if it is substantially similar   to this Form W-9.   Definition of a U.S. person. For federal tax purposes, you are   considered a U.S. person if you are:   • An individual who is a U.S. citizen or U.S. resident alien,   • A partnership, corporation, company, or association created or   organized in the United States or under the laws of the United States,   • An estate (other than a foreign estate), or   • A domestic trust (as defined in Regulations section 301.7701-7).   Special rules for partnerships. Partnerships that conduct a trade or   business in the United States are generally required to pay a withholding   tax on any foreign partners’ share of income from such business.   Further, in certain cases where a Form W-9 has not been received, a   partnership is required to presume that a partner is a foreign person,   and pay the withholding tax. Therefore, if you are a U.S. person that is a   partner in a partnership conducting a trade or business in the United   States, provide Form W-9 to the partnership to establish your U.S.   status and avoid withholding on your share of partnership income.   Cat. No. 10231X Form W-9 (Rev. 12-2011)    

 

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 10/12   Form W-9 (Rev. 12-2011) Page 2   The person who gives Form W-9 to the partnership for purposes of   establishing its U.S. status and avoiding withholding on its allocable   share of net income from the partnership conducting a trade or business   in the United States is in the following cases:   • The U.S. owner of a disregarded entity and not the entity,   • The U.S. grantor or other owner of a grantor trust and not the trust,   and   • The U.S. trust (other than a grantor trust) and not the beneficiaries of   the trust.   Foreign person. If you are a foreign person, do not use Form W-9.   Instead, use the appropriate Form W-8 (see Publication 515,   Withholding of Tax on Nonresident Aliens and Foreign Entities).   Nonresident alien who becomes a resident alien. Generally, only a   nonresident alien individual may use the terms of a tax treaty to reduce   or eliminate U.S. tax on certain types of income. However, most tax   treaties contain a provision known as a “saving clause.” Exceptions   specified in the saving clause may permit an exemption from tax to   continue for certain types of income even after the payee has otherwise   become a U.S. resident alien for tax purposes.   If you are a U.S. resident alien who is relying on an exception   contained in the saving clause of a tax treaty to claim an exemption   from U.S. tax on certain types of income, you must attach a statement   to Form W-9 that specifies the following five items:   1. The treaty country. Generally, this must be the same treaty under   which you claimed exemption from tax as a nonresident alien.   2. The treaty article addressing the income.   3. The article number (or location) in the tax treaty that contains the   saving clause and its exceptions.   4. The type and amount of income that qualifies for the exemption   from tax.   5. Sufficient facts to justify the exemption from tax under the terms of   the treaty article.   Example. Article 20 of the U.S.-China income tax treaty allows an   exemption from tax for scholarship income received by a Chinese   student temporarily present in the United States. Under U.S. law, this   student will become a resident alien for tax purposes if his or her stay in   the United States exceeds 5 calendar years. However, paragraph 2 of   the first Protocol to the U.S.-China treaty (dated April 30, 1984) allows   the provisions of Article 20 to continue to apply even after the Chinese   student becomes a resident alien of the United States. A Chinese   student who qualifies for this exception (under paragraph 2 of the first   protocol) and is relying on this exception to claim an exemption from tax   on his or her scholarship or fellowship income would attach to Form   W-9 a statement that includes the information described above to   support that exemption.   If you are a nonresident alien or a foreign entity not subject to backup   withholding, give the requester the appropriate completed Form W-8.   What is backup withholding? Persons making certain payments to you   must under certain conditions withhold and pay to the IRS a percentage   of such payments. This is called “backup withholding.”  Payments that   may be subject to backup withholding include interest, tax-exempt   interest, dividends, broker and barter exchange transactions, rents,   royalties, nonemployee pay, and certain payments from fishing boat   operators. Real estate transactions are not subject to backup   withholding.   You will not be subject to backup withholding on payments you   receive if you give the requester your correct TIN, make the proper   certifications, and report all your taxable interest and dividends on your   tax return.   Payments you receive will be subject to backup    withholding if:   1. You do not furnish your TIN to the requester,   2. You do not certify your TIN when required (see the Part II   instructions on page 3 for details),   3. The IRS tells the requester that you furnished an incorrect TIN,   4. The IRS tells you that you are subject to backup withholding   because you did not report all your interest and dividends on your tax   return (for reportable interest and dividends only), or   5. You do not certify to the requester that you are not subject to   backup withholding under 4 above (for reportable interest and dividend   accounts opened after 1983 only).   Certain payees and payments are exempt from backup withholding.   See the instructions below and the separate Instructions for the   Requester of Form W-9.   Also see Special rules for partnerships on page 1.   Updating Your Information   You must provide updated information to any person to whom you   claimed to be an exempt payee if you are no longer an exempt payee   and anticipate receiving reportable payments in the future from this   person. For example, you may need to provide updated information if   you are a C corporation that elects to be an S corporation, or if you no   longer are tax exempt. In addition, you must furnish a new Form W-9 if   the name or TIN changes for the account, for example, if the grantor of a   grantor trust dies.   Penalties   Failure to furnish TIN. If you fail to furnish your correct TIN to a   requester, you are subject to a penalty of $50 for each such failure   unless your failure is due to reasonable cause and not to willful neglect.   Civil penalty for false information with respect to withholding. If you   make a false statement with no reasonable basis that results in no   backup withholding, you are subject to a $500 penalty.   Criminal penalty for falsifying information. Willfully falsifying   certifications or affirmations may subject you to criminal penalties   including fines and/or imprisonment.   Misuse of TINs. If the requester discloses or uses TINs in violation of   federal law, the requester may be subject to civil and criminal penalties.   Specific Instructions   Name   If you are an individual, you must generally enter the name shown on   your income tax return. However, if you have changed your last name,   for instance, due to marriage without informing the Social Security   Administration of the name change, enter your first name, the last name   shown on your social security card, and your new last name.   If the account is in joint names, list first, and then circle, the name of   the person or entity whose number you entered in Part I of the form.   Sole proprietor. Enter your individual name as shown on your income   tax return on the “Name” line. You may enter your business, trade, or   “doing business as (DBA)” name on the “Business name/disregarded   entity name” line.   Partnership, C Corporation, or S Corporation. Enter the entity's name   on the “Name” line and any business, trade, or “doing business as   (DBA) name” on the “Business name/disregarded entity name” line.   Disregarded entity. Enter the owner's name on the “Name” line. The   name of the entity entered on the “Name” line should never be a   disregarded entity. The name on the “Name” line must be the name   shown on the income tax return on which the income will be reported.   For example, if a foreign LLC that is treated as a disregarded entity for   U.S. federal tax purposes has a domestic owner, the domestic owner's   name is required to be provided on the “Name” line. If the direct owner   of the entity is also a disregarded entity, enter the first owner that is not   disregarded for federal tax purposes. Enter the disregarded entity's   name on the “Business name/disregarded entity name” line. If the owner   of the disregarded entity is a foreign person, you must complete an   appropriate Form W-8.   Note. Check the appropriate box for the federal tax classification of the   person whose name is entered on the “Name” line (Individual/sole   proprietor, Partnership, C Corporation, S Corporation, Trust/estate).   Limited Liability Company (LLC). If the person identified on the   “Name” line is an LLC, check the “Limited liability company” box only   and enter the appropriate code for the tax classification in the space   provided. If you are an LLC that is treated as a partnership for federal   tax purposes, enter “P” for partnership. If you are an LLC that has filed a   Form 8832 or a Form 2553 to be taxed as a corporation, enter “C” for     C corporation or “S” for S corporation. If you are an LLC that is   disregarded as an entity separate from its owner under Regulation   section 301.7701-3 (except for employment and excise tax), do not   check the LLC box unless the owner of the LLC (required to be   identified on the “Name” line) is another LLC that is not disregarded for   federal tax purposes. If the LLC is disregarded as an entity separate   from its owner, enter the appropriate tax classification of the owner   identified on the “Name” line.    

 

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 11/12   Form W-9 (Rev. 12-2011) Page 3   Other entities. Enter your business name as shown on required federal   tax documents on the “Name” line. This name should match the name   shown on the charter or other legal document creating the entity. You   may enter any business, trade, or DBA name on the “Business name/   disregarded entity name” line.   Exempt Payee   If you are exempt from backup withholding, enter your name as   described above and check the appropriate box for your status, then   check the “Exempt payee” box in the line following the “Business name/   disregarded entity name,” sign and date the form.   Generally, individuals (including sole proprietors) are not exempt from   backup withholding. Corporations are exempt from backup withholding   for certain payments, such as interest and dividends.   Note. If you are exempt from backup withholding, you should still   complete this form to avoid possible erroneous backup withholding.   The following payees are exempt from backup withholding:   1. An organization exempt from tax under section 501(a), any IRA, or a   custodial account under section 403(b)(7) if the account satisfies the   requirements of section 401(f)(2),   2. The United States or any of its agencies or instrumentalities,   3. A state, the District of Columbia, a possession of the United States,   or any of their political subdivisions or instrumentalities,   4. A foreign government or any of its political subdivisions, agencies,   or instrumentalities, or   5. An international organization or any of its agencies or   instrumentalities.   Other payees that may be exempt from backup withholding include:   6. A corporation,   7. A foreign central bank of issue,   8. A dealer in securities or commodities required to register in the   United States, the District of Columbia, or a possession of the United   States,   9. A futures commission merchant registered with the Commodity   Futures Trading Commission,   10. A real estate investment trust,   11. An entity registered at all times during the tax year under the   Investment Company Act of 1940,   12. A common trust fund operated by a bank under section 584(a),   13. A financial institution,   14. A middleman known in the investment community as a nominee or   custodian, or   15. A trust exempt from tax under section 664 or described in section   4947.   The following chart shows types of payments that may be exempt   from backup withholding. The chart applies to the exempt payees listed   above, 1 through 15.   IF the payment is for . . . THEN the payment is exempt   for . . .   Interest and dividend payments All exempt payees except   for 9   Broker transactions Exempt payees 1 through 5 and 7   through 13. Also, C corporations.   Barter exchange transactions and   patronage dividends   Exempt payees 1 through 5   Payments over $600 required to be   reported and direct sales over   $5,000 1   Generally, exempt payees   1 through 7 2   1 See Form 1099-MISC, Miscellaneous Income, and its instructions.   2 However, the following payments made to a corporation and reportable on Form   1099-MISC are not exempt from backup withholding: medical and health care   payments, attorneys' fees, gross proceeds paid to an attorney, and payments for   services paid by a federal executive agency.   Part I. Taxpayer Identification Number (TIN)   Enter your TIN in the appropriate box. If you are a resident alien and   you do not have and are not eligible to get an SSN, your TIN is your IRS   individual taxpayer identification number (ITIN). Enter it in the social   security number box. If you do not have an ITIN, see How to get a TIN   below.   If you are a sole proprietor and you have an EIN, you may enter either   your SSN or EIN. However, the IRS prefers that you use your SSN.   If you are a single-member LLC that is disregarded as an entity   separate from its owner (see Limited Liability Company (LLC) on page 2),   enter the owner’s SSN (or EIN, if the owner has one). Do not enter the   disregarded entity’s EIN. If the LLC is classified as a corporation or   partnership, enter the entity’s EIN.   Note. See the chart on page 4 for further clarification of name and TIN   combinations.   How to get a TIN. If you do not have a TIN, apply for one immediately.   To apply for an SSN, get Form SS-5, Application for a Social Security   Card, from your local Social Security Administration office or get this   form online at www.ssa.gov. You may also get this form by calling   1-800-772-1213. Use Form W-7, Application for IRS Individual Taxpayer   Identification Number, to apply for an ITIN, or Form SS-4, Application for   Employer Identification Number, to apply for an EIN. You can apply for   an EIN online by accessing the IRS website at www.irs.gov/businesses   and clicking on Employer Identification Number (EIN) under Starting a   Business. You can get Forms W-7 and SS-4 from the IRS by visiting   IRS.gov or by calling 1-800-TAX-FORM (1-800-829-3676).   If you are asked to complete Form W-9 but do not have a TIN, write   “Applied For” in the space for the TIN, sign and date the form, and give   it to the requester. For interest and dividend payments, and certain   payments made with respect to readily tradable instruments, generally   you will have 60 days to get a TIN and give it to the requester before you   are subject to backup withholding on payments. The 60-day rule does   not apply to other types of payments. You will be subject to backup   withholding on all such payments until you provide your TIN to the   requester.   Note. Entering “Applied For” means that you have already applied for a   TIN or that you intend to apply for one soon.   Caution: A disregarded domestic entity that has a foreign owner must   use the appropriate Form W-8.   Part II. Certification   To establish to the withholding agent that you are a U.S. person, or   resident alien, sign Form W-9. You may be requested to sign by the   withholding agent even if item 1, below, and items 4 and 5 on page 4   indicate otherwise.   For a joint account, only the person whose TIN is shown in Part I   should sign (when required).  In the case of a disregarded entity, the   person identified on the “Name” line must sign. Exempt payees, see   Exempt Payee on page 3.   Signature requirements. Complete the certification as indicated in   items 1 through 3, below, and items 4 and 5 on page 4.   1. Interest, dividend, and barter exchange accounts opened   before 1984 and broker accounts considered active during 1983.   You must give your correct TIN, but you do not have to sign the   certification.   2. Interest, dividend, broker, and barter exchange accounts   opened after 1983 and broker accounts considered inactive during   1983. You must sign the certification or backup withholding will apply. If   you are subject to backup withholding and you are merely providing   your correct TIN to the requester, you must cross out item 2 in the   certification before signing the form.   3. Real estate transactions. You must sign the certification. You may   cross out item 2 of the certification.    

 

pReFeRReD ApARtment COmmUnItIes | sUBsCRIptIOn AgReement pg. 12/12   Form W-9 (Rev. 12-2011) Page 4   4. Other payments. You must give your correct TIN, but you do not   have to sign the certification unless you have been notified that you   have previously given an incorrect TIN. “Other payments” include   payments made in the course of the requester’s trade or business for   rents, royalties, goods (other than bills for merchandise), medical and   health care services (including payments to corporations), payments to   a nonemployee for services, payments to certain fishing boat crew   members and fishermen, and gross proceeds paid to attorneys   (including payments to corporations).   5. Mortgage interest paid by you, acquisition or abandonment of   secured property, cancellation of debt, qualified tuition program   payments (under section 529), IRA, Coverdell ESA, Archer MSA or   HSA contributions or distributions, and pension distributions. You   must give your correct TIN, but you do not have to sign the certification.   What Name and Number To Give the Requester   For this type of account: Give name and SSN of:   1. Individual The individual   2. Two or more individuals (joint               account)   The actual owner of the account or,   if combined funds, the first   individual on the account 1   3. Custodian account of a minor    (Uniform Gift to Minors Act)   The minor 2   4. a. The usual revocable savings   trust (grantor is also trustee)   b. So-called trust account that is   not a legal or valid trust under   state law   The grantor-trustee 1   The actual owner 1   5. Sole proprietorship or disregarded   entity owned by an individual   The owner 3   6. Grantor trust filing under Optional   Form 1099 Filing Method 1 (see   Regulation section 1.671-4(b)(2)(i)(A))   The grantor*   For this type of account: Give name and EIN of:   7. Disregarded entity not owned by an   individual   The owner   8. A valid trust, estate, or pension trust Legal entity 4   9. Corporation or LLC electing   corporate status on Form 8832 or   Form 2553   The corporation   10. Association, club, religious,   charitable, educational, or other     tax-exempt organization   The organization   11. Partnership or multi-member LLC The partnership   12. A broker or registered nominee The broker or nominee   13. Account with the Department of   Agriculture in the name of a public   entity (such as a state or local   government, school district, or   prison) that receives agricultural   program payments   The public entity   14. Grantor trust filing under the Form   1041 Filing Method or the Optional   Form 1099 Filing Method 2 (see   Regulation section 1.671-4(b)(2)(i)(B))   The trust   1    List first and circle the name of the person whose number you furnish. If only one person on a   joint account has an SSN, that person’s number must be furnished.   2    Circle the minor’s name and furnish the minor’s SSN.   3    You must show your individual name and you may also enter your business or “DBA”  name on   the “Business name/disregarded entity” name line. You may use either your SSN or EIN (if you   have one), but the IRS encourages you to use your SSN.   4    List first and circle the name of the trust, estate, or pension trust. (Do not furnish the TIN of the   personal representative or trustee unless the legal entity itself is not designated in the account   title.) Also see  Special rules for partnerships on page 1.   *Note. Grantor also must provide a Form W-9 to trustee of trust.   Note. If no name is circled when more than one name is listed, the   number will be considered to be that of the first name listed.   Secure Your Tax Records from Identity Theft   Identity theft occurs when someone uses your personal information   such as your name, social security number (SSN), or other identifying   information, without your permission, to commit fraud or other crimes.   An identity thief may use your SSN to get a job or may file a tax return   using your SSN to receive a refund.   To reduce your risk:   • Protect your SSN,   • Ensure your employer is protecting your SSN, and   • Be careful when choosing a tax preparer.   If your tax records are affected by identity theft and you receive a   notice from the IRS, respond right away to the name and phone number   printed on the IRS notice or letter.   If your tax records are not currently affected by identity theft but you   think you are at risk due to a lost or stolen purse or wallet, questionable   credit card activity or credit report, contact the IRS Identity Theft Hotline   at 1-800-908-4490 or submit Form 14039.   For more information, see Publication 4535, Identity Theft Prevention   and Victim Assistance.   Victims of identity theft who are experiencing economic harm or a   system problem, or are seeking help in resolving tax problems that have   not been resolved through normal channels, may be eligible for   Taxpayer Advocate Service (TAS) assistance. You can reach TAS by   calling the TAS toll-free case intake line at 1-877-777-4778 or TTY/TDD   1-800-829-4059.   Protect yourself from suspicious emails or phishing schemes.    Phishing is the creation and use of email and websites designed to   mimic legitimate business emails and websites. The most common act   is sending an email to a user falsely claiming to be an established   legitimate enterprise in an attempt to scam the user into surrendering   private information that will be used for identity theft.   The IRS does not initiate contacts with taxpayers via emails. Also, the   IRS does not request personal detailed information through email or ask   taxpayers for the PIN numbers, passwords, or similar secret access   information for their credit card, bank, or other financial accounts.   If you receive an unsolicited email claiming to be from the IRS,   forward this message to phishing@irs.gov. You may also report misuse   of the IRS name, logo, or other IRS property to the Treasury Inspector   General for Tax Administration at 1-800-366-4484. You can forward   suspicious emails to the Federal Trade Commission at: spam@uce.gov   or contact them at www.ftc.gov/idtheft or 1-877-IDTHEFT   (1-877-438-4338).   Visit IRS.gov to learn more about identity theft and how to reduce   your risk.   Privacy Act Notice   Section 6109 of the Internal Revenue Code requires you to provide your correct TIN to persons (including federal agencies) who are required to file information returns with   the IRS to report interest, dividends, or certain other income paid to you; mortgage interest you paid; the acquisition or abandonment of secured property; the cancellation   of debt; or contributions you made to an IRA, Archer MSA, or HSA. The person collecting this form uses the information on the form to file information returns with the IRS,   reporting the above information. Routine uses of this information include giving it to the Department of Justice for civil and criminal litigation and to cities, states, the District   of Columbia, and U.S. possessions for use in administering their laws. The information also may be disclosed to other countries under a treaty, to federal and state agencies   to enforce civil and criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism. You must provide your TIN whether or not you are required to   file a tax return. Under section 3406, payers must generally withhold a percentage of taxable interest, dividend, and certain other payments to a payee who does not give a   TIN to the payer. Certain penalties may also apply for providing false or fraudulent information.Exhibit101-FormofSubscription_Escrow_Agreement_UMB_Bank_-_900M

SUBSCRIPTION ESCROW AGREEMENT 

THIS SUBSCRIPTION ESCROW AGREEMENT dated as of [________], 2013 (this “Agreement”), is entered into among International Assets Advisory, LLC (the “Dealer Manager”), Preferred Apartment Communities, Inc. (the “Company”) and UMB Bank, National Association, a national banking association, as escrow agent (the “Escrow Agent”).

WHEREAS, the Company intends to raise cash funds from Investors (as defined below) pursuant to a public offering (the “Offering”) of up to 900,000 units, having a purchase price of $1,000 per unit (for an aggregate offering amount of $900,000,000), consisting of (i) 900,000 shares of Series A Redeemable Preferred Stock, par value $0.01 per share, and (ii) warrants to purchase 18,000,000 shares of common stock, par value $0.01 per share, of the Company (collectively, the “Securities”), pursuant to the registration statement on Form S-3 of the Company (No. 333- 183355) (as amended, the “Offering Document”). 

WHEREAS, the Escrow Agent is willing to accept appointment as escrow agent only for the express duties set forth herein.

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements contained herein, the parties hereto, intending to be legally bound, hereby agree as follows:

1.     Proceeds to be Escrowed.  On or before the date the Offering Document is declared effective by the Securities and Exchange Commission, the Company shall establish an escrow account with the Escrow Agent to be invested in accordance with Section 7 entitled “ESCROW ACCOUNT FOR THE BENEFIT OF INVESTORS OF UNITS OF PREFERRED APARTMENT COMMUNITIES, INC.” (including such abbreviations as are required for the Escrow Agent’s systems) (the “Escrow Account”).  All checks, wire transfers and other funds received from subscribers of Securities (“Investors”) in payment for the Securities (“Investor Funds”) will be delivered to the Escrow Agent within one business day following the day upon which such Investor Funds are received by the Company or its agents, and shall, upon receipt by the Escrow Agent, be retained in escrow by the Escrow Agent.  During the term of this Agreement, the Company or its agents shall cause all checks received by and made payable to it for payment for the Securities to be endorsed in favor of the Escrow Agent and delivered to the Escrow Agent for deposit in the Escrow Account.  

The initial escrow period shall commence upon the effectiveness of this Agreement and shall continue until the earliest to occur of:  (a) the close of business on [________], 2015, or [__________], 2016 if the  Offering is extended to such date by the Company; (b) the date the Escrow Agent receives written notice from the Company that it is abandoning the sale of the Securities; and (c) the date the Escrow Agent receives notice from the Securities and Exchange Commission or any other federal or state regulatory authority that a stop or similar order has been issued with respect to the Offering Document and has remained in effect for at least 20 days. The Escrow Account shall not be an interest-bearing account.

The Escrow Agent shall have no duty to make any disbursement, investment or other use of Investor Funds until and unless it has good and collected funds.  If any checks deposited in the Escrow Account are returned or prove uncollectible after the funds represented thereby have been released by the Escrow Agent, then the Company shall promptly reimburse the Escrow Agent for any and all costs incurred for such, upon request, and the Escrow Agent shall deliver the returned checks to the Company.  The Escrow Agent shall be under no duty or responsibility to enforce collection of any check delivered to it hereunder.  

2.     Investors.  Investors will be instructed by the Dealer Manager or any soliciting dealers retained by the Dealer Manager (the “Soliciting Dealers”) to remit the purchase price in the form of checks ( “instruments of payment”) payable to the order of, or funds wired in favor of, “UMB BANK, N.A., ESCROW AGENT FOR PREFERRED APARTMENT COMMUNITIES, INC.”  Any checks made payable to a party other than the Escrow Agent shall be returned to the Dealer Manager or Soliciting Dealer that submitted the check.  

If any subscription agreement for the purchase of Securities solicited by a Soliciting Dealer is rejected by the Company, then the subscription agreement and check for the purchase of Securities will be returned to the rejected subscriber within ten business days from the date of rejection.

All Investor Funds deposited in the Escrow Account shall not be subject to any liens or charges by the Company or the Escrow Agent, or judgments or creditors’ claims against the Company, until and unless released to the Company as hereinafter provided.  The Company understands and agrees that the Company shall not be entitled to any Investor Funds on deposit in the Escrow Account and no such funds shall become the property of the Company, or any other entity except as released to the Company pursuant to Section 3. The Escrow Agent will not use the information provided to it by the Company for any purpose other than to fulfill its obligations as Escrow Agent hereunder.  The Escrow Agent will treat all Investor information as confidential.  

3.     Disbursement of Funds.  The Escrow Agent, upon receipt of Escrow Release Notices, shall periodically transfer any portion of the Investor Funds to the Company or such other parties as set forth in the applicable Escrow Release Notice.  The Escrow Agent shall effect such transfer by the close of business on the date the Escrow Agent receives the applicable Escrow Release Notice; provided, however, if the Escrow Agent receives the applicable Escrow Release Notice after 2pm Central Time, then the Escrow Agent shall effect such transfer by the close of business on the next succeeding business day.

4.    Term of Escrow. The “Termination Date” shall be the earliest of:  (a) the close of business on [________], 2015, or [__________], 2016 if the  Offering is extended to such date by the Company; (b) all funds held in the Escrow Account are distributed to the Company or to Investors pursuant to Section 3 and the Company has informed the Escrow Agent in writing to close the Escrow Account; (c) the date the Escrow Agent receives written notice from the Company that it is abandoning the sale of the Securities; and (d) the date the Escrow Agent receives notice from the Securities and Exchange Commission or any other federal or state regulatory authority that a stop or similar order has been issued with respect to the Offering Document and has remained in effect for at least 20 days.  After the Termination Date, the 

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Company and its agents shall not deposit, and the Escrow Agent shall not accept, any additional amounts representing payments by prospective Investors.  

5.     Duty and Liability of the Escrow Agent. The sole duty of the Escrow Agent shall be to receive Investor Funds and subscription agreements and hold them subject to release, in accordance herewith, and the Escrow Agent shall be under no duty to determine whether the Company, the Dealer Manager or any Soliciting Dealer is complying with requirements of this Agreement, the Offering or applicable securities or other laws in tendering the Investor Funds to the Escrow Agent. No other agreement entered into between the parties, or any of them, shall be considered as adopted or binding, in whole or in part, upon the Escrow Agent notwithstanding that any such other agreement may be referred to herein or deposited with the Escrow Agent or the Escrow Agent may have knowledge thereof, including specifically but without limitation the Offering Document or any other document related to the Offering (including the subscription agreement and exhibits thereto), and the Escrow Agent’s rights and responsibilities shall be governed solely by this Agreement.  The Escrow Agent shall not be responsible for or be required to enforce any of the terms or conditions of the Offering Document or any other document related to the Offering (including the subscription agreement and exhibits thereto) or other agreement between the Company and any other party.  The Escrow Agent may conclusively rely upon and shall be protected in acting upon any statement, certificate, notice, request, consent, order or other document believed by it to be genuine and to have been signed or presented by the proper party or parties. The Escrow Agent shall have no duty or liability to verify any such statement, certificate, notice, request, consent, order or other document, and its sole responsibility shall be to act only as expressly set forth in this Agreement. Concurrent with the execution of this Agreement, the Company and the Dealer Manager shall each deliver to the Escrow Agent an authorized signers form in the form of Exhibit A or Exhibit A-1 to this Agreement, as applicable.  The Escrow Agent shall be under no obligation to institute or defend any action, suit or proceeding in connection with this Agreement unless first indemnified to its satisfaction.  The Escrow Agent may consult counsel of its own choice with respect to any question arising under this Agreement and the Escrow Agent shall not be liable for any action taken or omitted in good faith upon advice of such counsel.  The Escrow Agent shall not be liable for any action taken or omitted by it in good faith except to the extent that a court of competent jurisdiction determines that the Escrow Agent’s gross negligence or willful misconduct was the primary cause of loss. The Escrow Agent is acting solely as escrow agent hereunder and owes no duties, covenants or obligations, fiduciary or otherwise, to any other person by reason of this Agreement, except as otherwise stated herein, and no implied duties, covenants or obligations, fiduciary or otherwise, shall be read into this Agreement against the Escrow Agent.  If any disagreement between any of the parties to this Agreement, or between any of them and any other person, including any Investor, resulting in adverse claims or demands being made in connection with the matters covered by this Agreement, or if the Escrow Agent is in doubt as to what action it should take hereunder, the Escrow Agent may, at its option, refuse to comply with any claims or demands on it, or refuse to take any other action hereunder, so long as such disagreement continues or such doubt exists, and in any such event, the Escrow Agent shall not be or become liable in any way or to any person for its failure or refusal to act, and the Escrow Agent shall be entitled to continue so to refrain from acting until (a) the rights of all interested parties shall have been fully and finally adjudicated by a court of competent jurisdiction, or (b) all differences shall have been adjudged and all doubt resolved by agreement among all of the interested persons, and the Escrow Agent shall have been notified thereof in writing signed by all 

3

such persons. Notwithstanding the foregoing, the Escrow Agent may in its discretion obey the order, judgment, decree or levy of any court, whether with or without jurisdiction and the Escrow Agent is hereby authorized in its sole discretion to comply with and obey any such orders, judgments, decrees or levies.  If any controversy should arise with respect to this Agreement the Escrow Agent shall have the right, at its option, to institute an interpleader action in any court of competent jurisdiction to determine the rights of the parties.  IN NO EVENT SHALL THE ESCROW AGENT BE LIABLE, DIRECTLY OR INDIRECTLY, FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL LOSSES OR DAMAGES OF ANY KIND WHATSOEVER (INCLUDING WITHOUT LIMITATION LOST PROFITS), EVEN IF THE ESCROW AGENT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSSES OR DAMAGES AND REGARDLESS OF THE FORM OF ACTION.  The parties hereto agree that the Escrow Agent has no role in the preparation of the Offering Documents (including the subscription agreement and exhibits thereto) and makes no representations or warranties with respect to the information contained therein or omitted therefrom.  The Escrow Agent shall have no obligation, duty or liability with respect to compliance with any federal or state securities, disclosure or tax laws concerning the Offering Documents or any other document related to the Offering (including the subscription agreement and exhibits thereto) or the issuance, offering or sale of the Securities.  The Escrow Agent shall have no duty or obligation to monitor the application and use of the Investor Funds once transferred to the Company, that being the sole obligation and responsibility of the Company.

6.     Escrow Agent’s Fee. The Escrow Agent shall be entitled to compensation for its services as stated in the fee schedule attached hereto as Exhibit B, which compensation shall be paid by the Company. The fee agreed upon for the services rendered hereunder is intended as full compensation for the Escrow Agent’s services as contemplated by this Agreement; provided, however, that if (a) the conditions for the disbursement of funds under this Agreement are not fulfilled, (b) the Escrow Agent renders any material service not contemplated in this Agreement, (c) there is any assignment of interest in the subject matter of this Agreement, (d) there is any material modification hereof, (e) any material controversy arises hereunder, or (f) the Escrow Agent is made a party to any litigation pertaining to this Agreement or the subject matter hereof, then the Escrow Agent shall be reasonably compensated for such extraordinary services and reimbursed for all costs and expenses, including reasonable attorney’s fees, occasioned by any delay, controversy, litigation or event, and the same shall be recoverable from the Company.  The Company’s obligations under this Section 6 shall survive the resignation or removal of the Escrow Agent and the assignment or termination of this Agreement.

7.    Investment of Investor Funds.  Investor Funds shall be deposited in the Escrow Account in accordance with Section 1 and held uninvested in the Escrow Account, which shall be non-interest bearing.

8.     Notices.  All notices, requests, demands, and other communications under this Agreement shall be in writing and shall be deemed to have been duly given (a) on the date of service if served personally on the party to whom notice is to be given, (b) on the day of transmission if sent by facsimile/email transmission bearing an authorized signature to the facsimile number/email address given below, and written confirmation of receipt is obtained promptly after completion of transmission, (c) on the day after delivery to Federal Express or similar overnight courier or the Express Mail service maintained by the United States Postal 

4

Service, or (d) on the fifth day after mailing, if mailed to the party to whom notice is to be given, by first class mail, registered or certified, postage prepaid, and properly addressed, return receipt requested, to the party as follows:

If to the Company:
 
Preferred Apartment Communities, Inc.
3625 Cumberland Boulevard, Suite 1150
Atlanta, Georgia  30339
Fax: (770) 818-4105
Attention:  John A. Williams, Chief Executive Officer
Attention:  Jeffrey Sprain, General Counsel and Secretary

with a copy to: 

Proskauer Rose LLP
Eleven Times Square
New York, New York 10036
Fax: (212) 969-2900
Attention: Peter M. Fass, Esq.
    James P. Gerkis, Esq.

If to the Dealer Manager:

International Assets Advisory, LLC
300 South Orange Ave., Suite 1100
Orlando, Florida  32801
Fax: (407) 254-1500
Attention:  Ed Cofrancesco

with a copy to: 

Foley & Lardner, LLP
100 North Tampa Street
Suite 2700
Tampa, Florida  33602
Fax: (813) 221-4210
Attention:  Martin Traber, Esq.
                  Steven Vasquez, Esq.

If to Escrow Agent:

UMB Bank, National Association
1010 Grand Blvd. 4th Floor
Mail Stop: 1020409

5

Kansas City, Missouri 64106
Attention:  Lara Stevens, Corporate Trust
Telephone: (816) 860-3017
Fax: (816) 860-3029
Email: lara.stevens@umb.com

Any party may change its address for purposes of this Section by giving the other party written notice of the new address in the manner set forth above.

9.     Indemnification of Escrow Agent. The Company and the Dealer Manager hereby agree to, jointly and severally, indemnify, defend and hold harmless the Escrow Agent from and against, any and all losses, liabilities, costs, damages and expenses, including, without limitation, reasonable counsel fees and expenses, which the Escrow Agent may suffer or incur by reason of any action, claim or proceeding brought against the Escrow Agent arising out of or relating in any way to this Agreement or any transaction to which this Agreement relates unless such loss, liability, cost, damage or expense is finally determined by a court of competent jurisdiction to have been primarily caused by the gross negligence or willful misconduct of the Escrow Agent.  The terms of this Section shall survive the termination of this Agreement and the resignation or removal of the Escrow Agent.

10.     Successors and Assigns. Except as otherwise provided in this Agreement, no party hereto shall assign this Agreement or any rights or obligations hereunder without the prior written consent of the other parties hereto and any such attempted assignment without such prior written consent shall be void and of no force and effect. This Agreement shall inure to the benefit of and shall be binding upon the successors and permitted assigns of the parties hereto.  Any corporation or association into which the Escrow Agent may be converted or merged, or with which it may be consolidated, or to which it may sell or transfer all or substantially all of its corporate trust business and assets as a whole or substantially as a whole, or any corporation or association resulting from any such conversion, sale, merger, consolidation or transfer to which the Escrow Agent is a party, shall be and become the successor Escrow Agent under this Agreement and shall have and succeed to the rights, powers, duties, immunities and privileges as its predecessor, without the execution or filing of any instrument or paper or the performance of any further act.

11.     Governing Law; Jurisdiction. This Agreement shall be construed, performed, and enforced in accordance with, and governed by, the internal laws of the State of New York, without giving effect to the principles of conflicts of laws thereof.

12.     Severability. If any provision of this Agreement is declared by any court or other judicial or administrative body to be null, void, or unenforceable, said provision shall survive to the extent it is not so declared, and all of the other provisions of this Agreement shall remain in full force and effect.

13.     Amendments; Waivers. This Agreement may be amended or modified, and any of the terms, covenants, representations, warranties, or conditions hereof may be waived, only by a written instrument executed by the parties hereto, or in the case of a waiver, by the party waiving compliance. Any waiver by any party of any condition, or of the breach of any provision, term, 

6

covenant, representation, or warranty contained in this Agreement, in any one or more instances, shall not be deemed to be nor construed as further or continuing waiver of any such condition, or of the breach of any other provision, term, covenant, representation, or warranty of this Agreement.  The Company and the Dealer Manager agree that any requested waiver, modification or amendment of this Agreement shall be consistent with the terms of the Offering.  

14.     Entire Agreement. This Agreement contains the entire agreement and understanding among the parties hereto with respect to the escrow contemplated hereby and supersedes and replaces all prior and contemporaneous agreements and understandings, oral or written, with regard to such escrow.

15.     Section Headings. The section headings in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

16.     Counterparts. This Agreement may be executed (including by facsimile transmission) with counterpart signature pages or in counterparts, each of which shall be deemed an original, but all of which shall constitute the same instrument.

17.     Resignation. The Escrow Agent may resign upon 30 days’ advance written notice to the parties hereto. If a successor escrow agent is not appointed by the Company within the 30-day period following such notice, the Escrow Agent may petition any court of competent jurisdiction to name a successor escrow agent, or may interplead the Investor Funds with such court, whereupon the Escrow Agent’s duties hereunder shall terminate.

18.    References to Escrow Agent.  Other than the Offering Document, any of the other documents related to the Offering (including the subscription agreement and exhibits thereto) and any amendments thereof or supplements thereto, no printed or other matter in any language (including, without limitation, notices, reports and promotional material) which mentions the Escrow Agent’s name or the rights, powers, or duties of the Escrow Agent shall be issued by the Company or the Dealer Manager, or on the Company’s or the Dealer Manager’s behalf, unless the Escrow Agent shall first have given its specific written consent thereto.  Notwithstanding the foregoing, any amendment or supplement to the Offering Document or any other document related to the Offering (including the subscription agreement and exhibits thereto) that revises, alters, modifies, changes or adds to the description of the Escrow Agent or its rights, powers or duties hereunder shall not be issued by the Company or the Dealer Manager, or on the Company’s or the Dealer Manager’s behalf, unless the Escrow Agent has first given specific written consent thereto.

19.    Patriot Act Compliance.  The Company shall provide to the Escrow Agent upon the execution of this Agreement any documentation requested and any information reasonably requested by the Escrow Agent to comply with the USA Patriot Act of 2001, as amended from time to time.  

[Signature page follows.]

7

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed the date and year first set forth above.

PREFERRED APARTMENT COMMUNITIES, INC.

	
				
	By:
	 
	 

	 
	Name:
	John A. Williams
	 

	 
	Title:
	Chief Executive Officer
	 

INTERNATIONAL ASSETS ADVISORY, LLC

	
				
	By:
	 
	 

	 
	Name:
	Ed Confrancesco
	 

	 
	Title:
	President
	 

UMB BANK, NATIONAL 
ASSOCIATION, as Escrow Agent

	
				
	By:
	 
	 

	 
	Name:
	 Lara L. Stevens
	 

	 
	Title:
	 Vice President
	 

8

Exhibit A

CERTIFICATE AS TO AUTHORIZED SIGNATURES

Account Name:    

Account Number:    
The specimen signatures shown below are the specimen signatures of the individuals who have been designated as Authorized Representatives of Preferred Apartment Communities, Inc. and are authorized to initiate and approve transactions of all types for the above-mentioned account on behalf of Preferred Apartment Communities, Inc. 

	
		
	Name/Title
 
 
	Specimen Signature

	John A. Williams
Chief Executive Officer
	_______________________________
Signature

	 
	 

	Leonard A. Silverstein
President and Chief Operating Officer
	_______________________________
Signature

	 
	 

	Michael J. Cronin
Executive Vice President, Chief Accounting Officer and Treasurer
	

_______________________________
Signature

	 
	 

	William F. Leseman
Executive Vice President – Property Management
	_______________________________
Signature

	 
	 

	Jeffrey R. Sprain
General Counsel and Secretary
	_______________________________
Signature

9

Exhibit A-1

CERTIFICATE AS TO AUTHORIZED SIGNATURES

Account Name:    

Account Number:    
The specimen signatures shown below are the specimen signatures of the individuals who have been designated as Authorized Representatives of International Assets Advisory, LLC and are authorized to initiate and approve transactions of all types for the above-mentioned account on behalf of International Assets Advisory, LLC. 

	
		
	Name/Title
 
 
	Specimen Signature

	Ed Cofrancesco
President
	_______________________________
Signature

	 
	 

	Sheri Cuff
Chief Operating Officer
	_______________________________
Signature

	 
	 

	Ann A. Moore
Chief Compliance Officer
	_______________________________
Signature

10

Exhibit B

ESCROW FEES AND EXPENSES

Annual Fee 
Annual Escrow Agent                        $3,000

Transactional Fees, if applicable
Outgoing Wire Transfer                    $15 each
Daily Recon File to Transfer Agent                $2.50 per Business Day
Web Exchange Access                    $60 per month
Overnight Delivery/Mailings                    $16.50 each
IRS Tax Reporting                        $10 per 1099
Annual Fee will be payable upon the effectiveness of this agreement.  Transactional fees, if any, will be billed quarterly in arrears. Other fees and expenses will be billed as incurred. 
Fees specified are for the regular, routine services contemplated by this Agreement, and any additional or extraordinary services, including, but not limited to disbursements involving a dispute or arbitration, or administration while a dispute, controversy or adverse claim is in existence, will be charged based upon time required at the then standard hourly rate.  

11

Exhibit C

FORM OF ESCROW RELEASE NOTICE

Date:                 

UMB Bank, National Association
1010 Grand Blvd. 4th Floor
Mail Stop: 1020409
Kansas City, Missouri 64106

Ladies and Gentlemen:

In accordance with the terms of Section 3 of the Subscription Escrow Agreement dated as of [_____________], 2013 (as the same may be amended from time to time, the “Escrow Agreement”), among Preferred Apartment Communities, Inc. (the “Company”), International Assets Advisory, LLC (the “Dealer Manager”) and UMB Bank, National Association (the “Escrow Agent”), the Company and the Dealer Manager hereby notify the Escrow Agent that the ________ closing will be held on ___________ for gross proceeds of $_________.

PLEASE DISTRIBUTE FUNDS BY WIRE TRANSFER (or as indicated) AS FOLLOWS 
(wire instructions attached):

$
$

Very truly yours,

PREFERRED APARTMENT COMMUNITIES, INC., 
as the Company

By:                             
    Name:                         
    Title:                        

INTERNATIONAL ASSETS ADVISORY, LLC, 
as the Dealer Manager

By:                             
    Name:                        

12

Title:                        

13

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