Document:

Exhibit 10.359

 

PROJECT ADMINISTRATION AGREEMENT

[West Morehead, Charlotte, NC]

 

THIS PROJECT ADMINISTRATION
MANAGEMENT AGREEMENT (this “Agreement”) is made as of the 24th day of November, 2015, by and between BRG
MOREHEAD DEVELOPMENT MANAGER, LLC, a Delaware limited liability company (“Development Manager”) and ARCHCO WMH PM
LLC, a Delaware limited liability company (“Project Manager”), and joined into on a limited basis by BR ARCHCO MOREHEAD,
LLC, a Delaware limited liability company (“Owner”).

 

WHEREAS, Owner is
the owner or contract vendee of the West Morehead project. The West Morehead
site is comprised of comprised of real property located at 1309 and 1331 West Morehead Street and 811 and 829 South Summit Avenue,
Charlotte, North Carolina (the “Property”);

 

WHEREAS, Owner is
of desirous of retaining development and project administration services to expediently and cost-effectively complete construction
of the Property to become a Class A apartment community consisting of, as currently planned, 287 Class A apartment units in a
five-story, wood-frame building surrounding a pre-cast six-level garage. Amenities within the community will be comparable to
the new apartment properties in the vicinity, and will include a resort-style swimming pool, fitness center, business center and
three courtyards.

 

WHEREAS, Owner has
entered into a Development Agreement with Development Manager for the above-noted services, and Development Manager and Project
Manager are desirous of entering into this Agreement whereby Project Manager will provide such services to Development Manager
on behalf of Owner subject to Development Manager’s oversight and control, in accordance with the terms and conditions of
this Agreement.

 

NOW, THEREFORE, the
parties hereto, intending legally to be bound, hereby agree as follows:

 

ARTICLE I

DEFINITIONS

 

1.1           Each
of the following terms is defined as follows:

 

“Architect”
means Poole & Poole Archicture, LLC, the architectural firm retained by Owner.

 

“Architect’s
Contract” means the contract entered into between Owner and Architect in connection with the Project.

 

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

 

     

     

    

 

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

 

“Change
Cap” shall mean $250,000.

 

“Commencement
of Construction” means the date on which Owner delivers a notice to commence
construction to the General Contractor
after the Owner has acquired the Property.

 

“Construction
Contract” means any contract between Owner and a Contractor providing for the construction of any portion of the Improvements;
such term includes the General Contract.

 

“Contractor”
means each party who enters into a contract directly with the Owner and who provides labor, services or materials for any part
of the Improvements under the terms of a Construction Contract; such term includes the General Contractor.

 

“Construction
Lender” shall mean the lender that enters into Construction Loan Documents with the Owner for the Project.

 

“Construction
Loan” shall mean the loan by Construction Lender pursuant to which Owner shall finance the development, construction and
lease-up of the Project, all as more specifically provided in the Construction Loan Documents.

 

“Construction
Loan Documents” shall mean the loan and security documents and all instruments, agreements and all other documentation executed
and delivered in connection with the Construction Loan.

 

“Construction
Schedule” shall mean the construction schedule attached hereto as Exhibit C,
as the same may be modified by or with the prior written approval of Development Manager, on behalf of Owner, based on the proposal
of Project Manager.

 

“Development
Budget” means the projected costs and expenses, in the form attached hereto as Exhibit B (which shall be based upon the
Construction Schedule attached hereto as Exhibit C), prepared by Project Manager and approved in writing by Development
Manager, on behalf of Owner, as the same may be modified by or with the prior written
approval of Development Manager, on behalf of Owner, based on the proposal of Project Manager. The Development Budget is intended
to reflect all projected costs and expenses to be incurred in connection with the acquisition and completion of the Project through
Project Final Completion (including, without limitation or duplication, pre-development costs, financing costs, hard and soft
costs of completing the Improvements (on-site and off-site), fixtures and equipment, design fees, and legal expenses). 

 

    	 	2	 

     

    

 

“Development
Manager” shall have the meaning ascribed to it in the preamble hereof.

 

“Development
Plan” shall mean and consist of those materials which show the means, methods, sequences and schedules pursuant to which
Project Manager shall complete the Improvements, develop the Property, and otherwise fulfill the purposes of this Agreement. Without
limitation, these materials shall include the Development Budget, the Construction Schedule, and the Drawings and Specifications.

 

“Drawings and
Specifications” means the construction drawings and specifications necessary or appropriate for completion of the Project,
and all change orders, revisions, amendments or addenda thereto which are approved in writing by Owner or by Development Manager
on behalf of Owner.

 

“General Contract”
means the fixed price or guaranteed maximum price general contract entered into, or to be entered into, by Owner for construction
of the Project.

 

“General Contractor”
means the Contractor that is the party to the General Contract other than Owner.

 

“Improvements”
means the improvements to the Land, which, as contemplated by the Drawings and Specifications, shall consist of, without limitation,
a Class A apartment community consisting of 287 apartment units in a five-story, wood-frame building surrounding a pre-cast
six-level garage, amenities comparable to the new apartment properties in the vicinity, a resort-style swimming pool, a fitness
center, a business center and three courtyards.

 

“Land”
means the land legally described on Exhibit A attached hereto.

 

“Project”
means the Improvements and the Land.

 

“Project Documents”
means

 

		(a)	The Architect’s Contract;

 

		(b)	The Development Budget;

 

		(c)	All Construction Contracts;

 

		(d)	The Construction Schedule;

 

		(e)	This Agreement; and

 

		(f)	Any and all applications, permits, easements, approvals,
surety bonds and all other contracts and agreements relating to the Project executed or otherwise approved in writing by Development
Manager or which Project Manager is otherwise authorized to execute or enter into pursuant to this Agreement.

 

    	 	3	 

     

    

 

“Project Final
Completion” refers to the completion of the Improvements, and shall mean and be effective at such time as (a) the satisfactory
lien-free completion of all Improvements substantially in accordance with the Drawings and Specifications (including punchlist
items), as evidenced by (i) final lien waivers by all Contractors (and, if applicable, the consent of each surety which shall have
issued a performance and payment bond for the benefit of Owner or Development Manager with respect to the Project), (ii) an affidavit
from the General Contractor substantially in the form of AIA document G704, and (iii) such other affidavits, waivers and releases
from the General Contractor and/or the Contractors as Owner and its title insurer
or Construction Lender may reasonably require in order to assure lien free completion of the Project (including any
equitable lien claims), and (b) the receipt by Owner (or by Development Manager on behalf of Owner) of all final certificates of
occupancy necessary for occupancy of all of the Project), (c) the receipt by Owner (or by Development Manager on behalf of Owner)
of six copies of a final “as-built” survey, a final record set of Drawings and Specifications showing actual changes
made during construction, and all warranties and operation manuals for all equipment, appliances and other components contained
in the Project, (d) the General Contractor has completed its final site cleanup and restoration, including, without limitation,
removal of all excess materials, rock, sand, paving, and miscellaneous debris, supplies, equipment and trailers; and (e) all temporary
utilities are disconnected.

 

“Units”
shall mean the Project’s apartment units.

 

ARTICLE II

APPOINTMENT

 

2.1           Development
Manager hereby retains Project Manager as an independent contractor to provide the development management services set forth in
this Agreement, with the authority to act on behalf of, and to bind, Development Manager, as agent for the Owner, but subject to
the specific limitations set forth in this Agreement. Subject only to any specific limitations of Project Manager’s authority
set forth elsewhere in this Agreement, Project Manager hereby agrees to provide the development management services provided for
in this Agreement, including but not limited to all phases of the design, finance administration, administration of the construction
draw requests and other financial and reporting under the Construction Loan and as required under the Construction Loan Documents,
governmental approval process, construction and completion of the Improvements.

 

2.2           As
an inducement to Development Manager to appoint Project Manager and enter into this Agreement, Project Manager covenants to Development
Manager as follows:

 

(a)          The
duties of Project Manager hereunder shall be performed or supervised at all times during the term of this Agreement by Neil T.
Brown, or by such successor as Development Manager may reasonably approve in writing from time to time.

 

(b)          Project
Manager shall work diligently, in accordance with the level of professionalism and expertise expected of a first-class, multifamily
real estate developer.

 

    	 	4	 

     

    

 

(c)          Project
Manager shall use all reasonable efforts, at all times and in the most expeditious and economical manner, to further the interests
of the Owner with respect to the Project and to cause timely Project Final Completion of the Project in accordance with the Project
Documents, subject only to the specific reservations set forth herein.

 

(d)          Project
Manager shall employ at its own cost and expense such qualified and capable personnel as may be necessary and appropriate to perform
its obligations and carry out its responsibilities hereunder;

 

(e)          Project
Manager shall use commercially reasonable efforts to cause the Improvements to be constructed, substantially in accordance with
the Drawings and Specifications, and any material defect in the Improvements or any material departure from the Drawings and Specifications
to be corrected by the Contractor.

 

(f)          Project
Manager shall provide Development Manager with information relevant to the Project, including without limitation the issuance of
the periodic reports required in section 8.1 below;

 

(g)          Project
Manager shall provide day-to-day coordination and periodic evaluation of the activities of all surveyors, architects, Contractors,
engineers, consultants and, to the extent bearing upon the Project, public utilities and governmental officials, and promptly advise
Development Manager with respect to any significant issues that may arise;

 

(h)          Project
Manager shall make recommendations to Development Manager in connection with decisions regarding the Project reserved to Development
Manager, including, without limitation, the retention of consultants;

 

(i)          Project
Manager shall cause the General Contractor to coordinate with the various public utility companies for the required removal of
any existing utilities, for the installation of any temporary service, for the installation of any new permanent service and, upon
Project Final Completion, disconnection of any temporary service;

 

(j)          Project
Manager shall negotiate, enter into contracts in the name, and authorize on behalf, of Owner, any consulting engineering, planning,
and surveying work in connection with the Project, all as provided for in the Development Budget, provided, however, no such contract
will, by the terms thereof, continue in effect after Project Final Completion without the prior review and approval of Development
Manager;

 

(k)          Project
Manager shall in the event of an emergency at the Project, take any action required under the circumstances to protect Owner’s
interest in the Project after first making all reasonable efforts to contact Development Manager orally for approval of such action
and confirm in writing the action so taken promptly thereafter;

 

(l)          Project
Manager shall cause the General Contractor to strictly supervise all work and ensure that the use and occupancy of the completed
Project shall comply with all applicable laws;

 

    	 	5	 

     

    

 

(m)          Project
Manager shall coordinate with the General Contractor, to the extent requested by the General Contractor, to accomplish the transfer
of, the application for, and issuance or re-issuance of, a building permit (if not heretofore issued) and coordinate the application
and approval process in connection with the issuance of certificates of occupancy, and periodic inspections conducted by governmental
officials, and any other required licenses or permits relating to the development and construction of the Project.

 

(n)          Project
Manager shall keep the Project free from unreasonable accumulations of waste materials and refuse at all times.

 

(o)          Project
Manager shall notify Development Manager in writing, promptly after it has knowledge of any action, suit or proceeding filed in
connection with the Project.

 

(p)          Development
Manager and any other designated representative of Development Manager shall, at all times during the term of this Agreement, have
the right of entry and free access to the Project and the right (but not the obligation) to inspect all work done, labor performed
and materials furnished in and about the Project and the right (but not the obligation) to inspect and audit all books, records,
and contracts relating to the Project.

 

(r)          Project
Manager shall provide to Development Manager true copies of all licenses, permits, authorizations and approvals pertaining to the
Project promptly after the same have been procured.

 

2.3           Development
Manager shall, from time to time, designate in writing one or more “representatives” to act on behalf of Development
Manager in all matters under this Agreement. Initially, Development Manager’s representatives shall be James Babb and Michael
Konig. Actions by a Development Manager’s representative shall be deemed actions of Development Manager. Project Manager
shall, from time to time, designate in writing one or more “representatives” to act on behalf of Project Manager in
all matter under this Agreement. Initially, Project Manager’s representative shall be Neil T. Brown. Actions by Project Manager’s
representative shall be deemed actions of Project Manager.

 

2.4           Development
Manager is an affiliate of Bluerock Residential Growth REIT, Inc. and Bluerock
Real Estate, LLC (collectively, “Bluerock”) and Project Manager is an affiliate of ArchCo Residential LLC (“ArchCo”),
respectively. Their respective affiliates (“Bluerock Affiliates” and “ArchCo Affiliates”) are or may become
indirect owners of Owner. Bluerock Affiliates and ArchCo Affiliates may have other rights and obligations with respect to the
Project under other agreements. Nothing herein contained shall be construed or deemed to alter, change or modify any of the rights
or obligations which any of those parties may otherwise have under any of the Project Documents, the limited liability company
agreement of Owner, the limited liability company agreement of the sole member of Owner, or any other agreement.

  

    	 	6	 

     

    

 

ARTICLE III

INTENTIONALLY OMITTED

 

ARTICLE IV

INTENTIONALLY OMITTED

 

ARTICLE V

DESIGN ACTIVITIES

 

5.1           Project
Manager shall exercise any and all rights and responsibilities of Owner, as authorized agent of Owner, under the Architect’s
Contract, except (a) as otherwise directed in writing by Development Manager from time to time and (b) except any exercise which
would result in (i) a modification (including any change order) or termination of the Architect’s Contract; (ii) any modification
(including any change order) of the Drawings and Specifications that will, in the aggregate, increase or decrease the cost of
construction or development of the Project by more than the Change Cap other
than any change (each, a “Mandated Change”) (A) reasonably necessary for compliance with laws (including, without
limitation, any such change which is reasonably necessary for the issuance of any permits or certificate of occupancy), (B) required
to address a previously unknown condition (e.g., the environmental or physical condition of the Site) or (C) required by the Construction
Lender; or (iii) any other matter which could have a material adverse affect on the Project and/or the Owner. Notwithstanding
the foregoing, Project Manager shall obtain Development Manager’s consent prior to initiating any Mandated Change costing
in the aggregate in excess of the Change Cap that would not otherwise be covered
by the Development Budget, after taking into account cost savings and amounts available for contingency, or which would result
in the foreseeable future of the Construction Loan falling “out of balance” as result of such expenditure.

 

5.2           Project
Manager shall supervise Architect and other consultants with respect to the preparation of the Drawings and Specifications, as
well as with respect to any and all proposed change orders, revisions, amendments or addenda thereto.

 

5.3           Project
Manager shall review any and all requests for changes in the Drawings and Specifications and, with respect to changes requiring
Owner’s approval pursuant to Section 5.1, make recommendations to Development Manager with regard to any such requested
changes.

 

ARTICLE VI

CONSTRUCTION

 

6.1           Except
as expressly provided to the contrary below, prior to re-commencing construction of the Project or at such later time as Project
Manager deems appropriate during the course of construction in order to comply with the Construction Schedule, Project Manager
shall (to the extent it has not already done so) do the following:

 

(a)          Obtain,
or cause the General Contractor to obtain, all necessary permits required by any governmental authority to re-commence and complete
construction of the Improvements, and verify that the contemplated use thereof, upon completion, will comply with all zoning and
land use laws.

 

    	 	7	 

     

    

 

(b)          Assist
Development Manager in selecting and retaining the professional services of surveyors, special consultants and testing laboratories
and coordinate their services to the extent the need for such services is known prior to the commencement of construction;

 

(c)          Negotiate
for Owner’s approval any easements required for (i) access to or egress from the Land, (ii) the installation of any utilities,
(iii) sanitary sewer systems and storm water sewer systems or storm water management;

 

(d)          Verify
that all zoning and land use laws and all other statutes, ordinances, codes, rules, regulations, orders, or other applicable laws
of any governmental or quasi-governmental authorities relating to the construction of the Project are being complied with and that
no such law, statute, ordinance, rule, regulation, or order shall impair or inhibit in any way the development and construction
of the Project;

 

(e)          Assist
Development Manager in the selection of each Contractor and the negotiation of each Construction Contract; provided, however, that
final selection of each Contractor and the approval and execution of each Construction Contract are reserved to Development Manager.

 

(f)          Prior
to the execution of any Construction Contract, Project Manager shall cause the preparation, for approval by Development Manager,
of the Construction Schedule identifying milestone events during construction thereunder. Project Manager shall prepare the Construction
Schedule, in cooperation with the Contractor, or shall review and analyze the Construction Schedule if prepared by the Contractor.

 

6.2           Project
Manager shall exercise any and all rights and responsibilities of Owner, as authorized agent of Owner, under each Construction
Contract, except as otherwise instructed by Development Manager from time to time, except any exercise which would result in (i)
any modification or termination of the Construction Contract, (ii) any change in the work covered by such Construction Contract,
and/or (iii) any adverse affect on the Project and/or Owner.

 

6.3           Project
Manager shall prepare the Development Budget and propose updates thereto on
a periodic basis so that it remains an accurate reflection of the future costs and expenses through Project Final Completion.
In addition, if at any time during the term of this Agreement it becomes reasonably apparent to Project Manager that the future
credit availability under the Construction Loan Documents may be insufficient to fund the Project through and including Project
Final Completion (i.e., the Construction Loan is at risk of going “out of balance”), then Project Manager shall immediately
notify Development Manager, including in such notice the anticipated timing and extent to which the Construction Loan may go out
of balance, together with Project Manager’s recommendations to prevent it from doing so or reducing the extent to which
it goes out of balance.

 

6.4           Changes
to Drawings and Specifications.

 

(a)          Except
otherwise provided in this Agreement, the Drawings and Specifications shall not be amended or modified by Project Manager without
the prior written consent of the Development Manager and, unless the Development Manager so consents, the Project Manager shall
cause the Project to be constructed substantially in accordance with the Drawings and Specifications as approved.

 

    	 	8	 

     

    

 

(b)          Project
Manager shall evaluate all proposed changes to the Drawings and Specifications with respect to (i) the validity, necessity and
cost thereof, and (ii) any implications to the overall job progress and costs, applicable Construction Contracts or engineering
contracts and identify possible alternatives. Project Manager shall prepare and submit to Development Manager a written report,
together with its recommendations, regarding any proposed changes, and any possible alternatives, requiring Development Manager’s
approval of any changes thereto. No work shall be commenced based on, or with respect to, any such proposed change until Development
Manager has approved a change order therefor.

 

(c)           If the proposed
changes to the Drawings and Specifications (i) (A) do not modify the Development Budget or (B) do not require consent of the Construction
Lender under the Construction Loan Documents, and (ii) if the Development Manager shall fail to respond to a request for approval
of a proposed change order, or alternative thereto, within five (5) business days after such submission, then Development Manager
shall be deemed to have approved Project Manager’s recommended action. If contrary to subsection (i)(A), the proposed change
would result in an adverse economic impact or change to the Development Budget, then Project Manager may not go forward with the
Project Manager’s recommended action until it shall have provided to Development Manager a proposed revised Development Budget
and shall have affirmatively obtained Development Manager’s express approval thereof (which will be sufficient if given by
electronic mail). If contrary to subsection (i)(B), the proposed change would require consent of the Construction Lender under
the Construction Loan Documents, then Project Manager may not go forward with the recommended action, except with Construction
Lender’s and the Development Manager’s prior written consent.

 

(d)          The
Drawings and Specifications shall be at all times deemed the property of the Owner and neither the Development Manager nor the
Project Manager shall have or claim any ownership interest therein.

 

6.5           The
development and construction management services to be performed by the Project Manager shall consist of the services listed below
and such other services which may reasonably be inferred therefrom or from the other terms of this Agreement, including the Development
Plan. Without limitation, the Project Manager shall oversee, manage, and coordinate the development of the Project, including,
without limitation, to: (i) cause the Project to be completed in an expeditious manner, (ii) cause the General Contractor substantially
to comply with and adhere to any progress schedules adopted by the Development Manager for the Project (without limitation, the
Construction Schedule); and (iii) cause the General Contractor to keep at the Project an adequate supply of workmen and materials.
In connection with the foregoing , the Project Manager shall, without limitation:

 

(a)          Advise
on the division of the Project into individual Construction Contracts for various categories of work (e.g., site work, building,
landscaping), including the method to be used for selecting Contractors and awarding Construction Contracts. If multiple Construction
Contracts are to be awarded, Project Manager shall review the Construction Contracts and make recommendations as required to provide
that (1) the work of the Contractors is coordinated, (2) all requirements for the Project have been assigned to the appropriate
Construction Contract, (3) the likelihood of jurisdictional disputes has been minimized, and (4) proper coordination has been provided
for phased construction.

 

    	 	9	 

     

    

 

(b)          Develop
bidders’ interest in the Project, establish bidding schedules, issue, with the assistance of the Architect, bidding documents
to bidders, conduct prebid conferences with prospective bidders and assist the Architect with regard to questions from bidders
and the issuance of addenda. Notwithstanding the foregoing, Project Manager may negotiate a Construction Contract with a single
Contractor on a “no-bid” basis, provided that such Construction Contract shall be subject to Development Manager’s
approval.

 

(c)          Receive
bids, prepare bid analyses and make recommendations to Development Manager for Owner’s award of Construction Contracts or
rejection of bids.

 

(d)          Prepare
and negotiate Construction Contracts, subject to Development Manager’s approval, and advise the Development Manager on the
acceptability of subcontractors and material suppliers proposed by Contractors.

 

(e)          As
necessary, inspect the progress of the work on the Project, and promptly notify Development Manager and the applicable Contractor
of any defective work or any other default under a Construction Contract observed by Project Manager.

 

(f)          Identify
and analyze alternative courses of action for unforeseen conditions, such as shortages, work stoppages, and/or accidents or casualties,
as they occur.

 

(g)          Review
each Contractor’s monthly payment requisitions and, if appropriate or necessary, negotiate revisions thereto with such Contractor.

 

(h)          Inspect
all of the Improvements (including landscaping), review and ensure the accuracy and completeness of all monthly reports and punchlists
prepared by Architect or an engineer and approved in writing by Development Manager for finalizing the work; supervise each Contractor
to facilitate the satisfactory completion of all of the work to be done under such Contractor’s Construction Contract; and
procure record drawings with notation of all changes and added details. Without limitation, Project Manager shall cause the Project
to be equipped with all fixtures, equipment and items of personal property required for the completion and operation of the Project
following completion, all substantially in accordance with the Drawings and Specifications.

 

(i)          Supervise
the building start-up and initial system operation, including inspection for punchlist items, and cause the General Contractor
to coordinate any modification of such systems as required.

 

(j)          Provide
administrative, management, financial and related services as required to (i) coordinate and supervise the work of each Contractor
with the activities and responsibilities of Development Manager and Architect to complete the Project in accordance with the Development
Plan, and (ii) comply with the draw requests and related requirements under the Construction Loan Documents so as to enable the
Owner to draw fundings of Construction Loan is accordance with Development Budget. Development Manager reserves the right to approve
all requisitions prepared by Project Manager, provided that such approval shall not cause a delay in the processing of pay applications,
before they shall be authorized on behalf of the Owner.

 

    	 	10	 

     

    

 

(k)          Review
any final claims and proposed final change orders and close-out of each Construction Contract, review the final payments on each
Construction Contract and ensure, in a prompt fashion to allow Development Manager to cause Owner to timely make payments under
the Construction Contract, that adequate final lien waivers have been collected in the correct amount from all subcontractors and
materialmen working on the job; all such payments shall be made by Development Manager in the manner specified in the applicable
Construction Contract, but only upon receipt by Development Manager of documentation reasonably satisfactory to Development Manager;
be responsible for the collection of such documentation; prepare and submit to Development Manager at least fifteen (15) days before
the final payment of retention is due, a written report with respect to such documentation (provided, however, that Development
Manager acknowledges that the final unconditional lien waiver from each Contractor shall be submitted to Project Manager concurrently
with the final payment of retainage and a copy shall promptly thereafter be forwarded to Development Manager). Development Manager
reserves the right to approve all such matters before they are finalized on behalf of the Owner, such approval not to be unreasonably
withheld or delayed.

 

(l)          Maintain
or cause to be maintained separate true, complete and correct books of account and records pertaining to all costs incurred by
Project Manager in connection with development and construction of the Improvements, including, without limitation, costs advanced
prior to the date of this Agreement, and any reimbursements or refinancing proceeds to or on behalf of the Owner out of the proceeds
of the initial advance under the Construction Loan for the Project, which books and records the Development Manager shall have
the right to inspect and copy at its own expense during regular business hours, at the place where they are then regularly maintained,
on reasonable advance notice to the Project Manager.

 

(m)          Consult
with Architect and Development Manager if a Contractor requests interpretations of the meaning and intent of the Drawings and Specifications
and assist in the resolution of questions which may arise.

 

(n)          Receive
certificates of insurance from (and ensure that insurance is maintained for) each Contractor and forward such certificates to Development
Manager.

 

ARTICLE VII

OMITTED

 

ARTICLE VIII

REPORTS

 

8.1           Project
Manager will submit written reports to Development Manager as necessary or appropriate, but no more frequently than monthly, which
shall indicate (i) the progress of the construction of the Improvements, (ii) any proposed revisions to the Construction Schedule,
the Development Budget or the Drawings and Specifications, with recommendations of action to be taken by Development Manager, and
(iii) any other recommendations and information which Project Manager is requested by Development Manager to provide.

 

    	 	11	 

     

    

 

8.2           Upon
Development Manager’s reasonable advance notice, Project Manager shall make it and sufficiently knowledgeable personnel available
to meet with Development Manager and/or its designees (telephonically or in-person) and, in advance of each such meeting, Project
Manager shall provide reports in such forms as may be reasonably required by the Development Manager or by the Construction Lender,
including reports regarding (a) the costs incurred in connection with the development, construction and equipping of the Project,
on a line by line basis as itemized in the Development Budget and on a cumulative basis; (b) a comparison of costs incurred to
the date of such report with the Development Budget; and (c) any recommended revision of the Development Plan, the Development
Budget, the Construction Schedule, or all of them.

 

8.3           All
written data and materials, including all records, contracts, receipts for deposits, unpaid bills, and other papers or documents
in the possession of the Project Manager or its affiliates which pertain to the Project or the business or affairs of the Owner
or the Project are and shall remain the property of the Owner; and

 

ARTICLE IX

RESPONSIBILITIES OF THE PARTIES

 

9.1           Project
Manager hereby agrees to indemnify, defend and hold Owner and Development Manager, and their respective members, officers, directors,
employees and agents harmless from any and all loss, liability or damage, or any claim thereof, that Owner or Development Manager
may incur or be subjected to as a result of the gross negligence or willful misconduct of Project Manager or default by Project
Manager under this Agreement. Subject to the foregoing, except to the extent that any of the following could have been avoided
by the diligent performance by the Project Manager of its duties hereunder, the Project Manager shall not be responsible for defaults
by the General Contractor and subcontractors in performance of their respective contracts, or for defaults by the Architect and
design engineers in performance of their respective contracts.

 

9.2           Development
Manager shall respond to all written requests submitted by Project Manager, and make all necessary decisions called for in such
requests as soon as practicable following receipt of such request taking into account the subject matter of such request.

 

9.3           Development
Manager shall provide Project Manager with access to any information or documents which will reasonably assist Project Manager
in meeting its obligations.

 

9.4           Development
Manager reserves the right of final approval as to all material documentation relating to the Project, including, without limitation
all Project Documents, all other third party contracts for the development of the Project, all change orders and any substantial
change in any of the foregoing. Notwithstanding the foregoing, material documentation shall not include equipment leases, temporary
staging agreements and other similar documents in the ordinary course of developing the Project, none of which by the terms thereof
will continue in effect after Project Final Completion without the prior review and approval of Development Manager.

 

    	 	12	 

     

    

 

9.5           Project
Manager shall notify Development Manager of, and Development Manager shall have the right to participate in, all meetings concerning
the development of the Project, including, without limitation, meetings with subcontractors regarding material disputes, meetings
with consultants and other third parties regarding the Project, and all regularly scheduled project meetings with the General Contractor,
provided, however, it is not intended that Project Manager notify Development Manager of day-to-day meetings involving only its
employees and the General Contractor (and subcontractors) if no material dispute is involved).

 

ARTICLE X

FEES

 

10.1         In
consideration of Project Manager’s services provided hereunder, Development Manager shall cause Owner to pay directly to
Project Manager a Development Fee in the amount equal to 3.0% of the total amount of the Final Development Budget (as defined
in Section 12.4) (but excluding from the Final Development Budget any Development Fee payable to Project Manager) (such amount,
the “Development Fee”), which Development Fee (a) shall be payable twenty-five percent upon Commencement of Construction
and (b) the balance earned and payable on a monthly basis in equal monthly installments
beginning on the first day of the second calendar month following the Commencement
of Construction and on the first day of each month thereafter during the construction period
as set forth in the Construction Schedule. If the Construction Schedule is modified, appropriate adjustments to the amount of
the monthly installments on account of the Development Fee shall be made.

 

10.2         In
addition, Development Manager shall cause Owner to pay directly to Project Manager a Construction Management Fee in the amount
equal to 1.0% of hard costs included in the Final Development Budget (the “CM Fee”), which CM Fee shall be payable
on a monthly basis in equal monthly installments beginning on Commencement of Construction and on the first day of each month thereafter
during the construction period.

 

10.3         In
addition, Development Manager shall cause Owner to reimburse Project Manager for its reasonable and actually incurred out-of-pocket
expenses for its reasonable and actually incurred out-of-pocket business expenses (together, the “Expense Reimbursements”),
provided however, Project Manager’s expense reimbursements may not exceed $50,000 without the Development Manager’s
prior consent. Expense Reimbursements shall be made only if Project Manager provides the Development Manager with receipts and
other evidence reasonably required by the Development Manager to substantiate the amount to be reimbursed. For the avoidance of
doubt, the Expense Reimbursements are not intended to include any amounts for salaries or other overhead expenses of Project Manager
or ArchCo Affiliates.

 

10.4         Owner
hereby joins this Agreement for the limited purpose of confirming its obligation to pay the Development Fee and CM Fees (collectively,
the “Fees”) and Expense Reimbursements if, as and when earned and/or payable.

 

    	 	13	 

     

    

 

10.5         Notwithstanding
anything to the contrary in this Agreement, no Fees shall be deemed earned (or payable) unless and until there has been a Commencement
of Construction, nor shall there be any obligation to pay or liability for Expense Reimbursements unless and until there has been
a Commencement of Construction.

 

ARTICLE XI

TERM

 

11.1         The
term of this Agreement shall commence on the date hereof and shall terminate at such time as (i) Project Final Completion has been
achieved, Project Manager has performed its obligations hereunder, and all Fees due Project Manager hereunder have been paid, or
(ii) if prior thereto, Project Manager receives a written notice from Development Manager to the effect that Owner or Development
Manager are abandoning the Project, or (iii) the Agreement is terminated pursuant to Article XII hereof.

 

11.2         In
the event that this Agreement is terminated under Section 11.1(ii) or if this Agreement is terminated under Section 11.1(iii) due
to a default by the Development Manager or Owner under one or more of the provisions in Article XII hereof, the Project Manager
shall be entitled to the full amount of its Fees and Development Manager shall cause the Owner to pay directly to Project Manager
the balance of the unpaid Fees in a single lump sum payment within ten days of termination; provided however, any such payment
otherwise called for under the preceding sentence shall not be earned, due or payable unless, as a threshold matter, there has
first been a Commencement of Construction.

 

ARTICLE XII

DEFAULT AND TERMINATION

 

12.1         It
shall be an event of default hereunder if

 

(a)          Either
party fails to perform any of its obligations under this Agreement, and such failure to perform continues for a period of twenty
(20) days after written notice of such failure to the defaulting party from the other party hereto; provided, however, that, unless
the breach is by its nature not susceptible to cure, if the default cannot be cured within twenty (20) days and the defaulting
party commences a cure within such twenty (20) day period and thereafter diligently pursues such cure, the cure period shall extend
for not more than an additional 60 day period of time necessary to effect such cure.

 

(b)          Owner
or Development Manager suffers or incurs any loss, liability or damage as a
result of the gross negligence, willful misconduct, fraud or bad faith of Project Manager or any of its affiliates in connection
with the Project.

 

(c)          Owner,
Development Manager or any of their affiliates causes Project Manager or WMH Sponsor LLC to incur any loss, liability or damage
as a result of the gross negligence, willful misconduct, fraud or bad faith of Owner, Development Manager or any of their affiliates
in connection with the Project.

 

(d)          Project
Manager, WMH Sponsor LLC or ArchCo WMH CM LLC is the subject of any Bankruptcy/Dissolution
Event.

 

    	 	14	 

     

    

 

(e)          Owner,
Development Manager or the guarantor of the Construction Loan is the subject of any Bankruptcy/Dissolution
Event.

 

(f)          Neil
T. Brown does not own at least 51% of the equity interests in ArchCo Residential LLC or does not control, directly or indirectly,
the day-to-day operations of ArchCo Residential LLC and Project Manager.

 

12.2         Upon
the occurrence of an event of default by Owner or Development Manager, Project Manager,
provided it is not in default hereunder, shall have the right to terminate this Agreement, by giving written notice to
Development Manager. 

 

12.3         Upon
the occurrence of an event of default by Project Manager, Development Manager shall have the right to terminate this Agreement,
by giving written notice to Project Manager, in which event the Project Manager upon termination shall be paid its Expense Reimbursements
and Fees for services hereunder which had been earned prior to the date of Project Manager’s default (less any damages incurred
by Owner or Development Manager as a result of such default), but which remain unpaid, but, upon termination, neither Owner nor
Development Manager shall be obligated to make any further interim payments of Fees to Project Manager and no Fees shall be thereafter
due or payable, and Development Manager shall be permitted to pursue any and all remedies available at law or in equity. 
For the avoidance of doubt, all liability of Project Manager accruing hereunder prior to such termination shall survive such termination.

 

12.4         For
the avoidance of doubt, each of the following shall constitute an event of default on the part of Project Manager with respect
to which there shall be notice and cure rights provided for in Section 12.1: (a) the Project Manager’s failure to maintain
the progress called for under the final form of Construction Schedule that, at the time of Commencement of Construction, is prepared
by Project Manager and approved in writing by Development Manager on behalf of Owner (“Final Construction Schedule”),
but including any subsequent changes thereto proposed by Project Manager and, in its sole discretion, approved in writing by Development
Manager on behalf of Owner (but in all cases other than by reason of delays resulting from force majeure events or acts of the
Development Manager), or (b) actual or reasonably projected expenses under the Development Budget (as updated from time to time
by the Project Manager as provided herein), less land cost, are in excess of two and one-half percent (2.5%) more than (i) the
amount of the final Development Budget that, at the time of Commencement of Construction, is prepared by Project Manager and approved
in writing by Development Manager on behalf of Owner, plus/minus any subsequent changes thereto proposed by Project Manager and,
in its sole discretion, approved in writing by Development Manager on behalf of Owner (“Final Development Budget”),
less (ii) land cost, in the aggregate.

 

12.5         In
addition to all other requirements of Project Manager hereunder, upon the expiration of the term of this Agreement, whether by
completion of the Project or any earlier termination, Project Manager shall deliver to Development Manager the original of all
materials relating to the Project prepared pursuant to this Agreement or any of the Project Documents and/or other materials prepared
with respect to the Project which are in the possession of Project Manager.

 

    	 	15	 

     

    

 

ARTICLE XIII

SUCCESSORS AND ASSIGNS

 

The provisions of
this Agreement shall be binding upon, and inure to the benefit of, Development Manager, Project Manager and their respective successors,
assigns, and legal representatives; provided, however, that Project Manager shall not assign or transfer its interest in this
Agreement without the written consent of Development Manager, which may be granted or withheld in its discretion.

 

ARTICLE XIV

INSURANCE

 

14.1         Project
Manager shall place and maintain in force insurance with coverage, limits and amounts as follows:

 

(a)          Worker’s
Compensation insurance (including employers’ liability insurance) covering employees of Project Manager, employed in, on
or about the Project, in an amount sufficient to provide statutory benefits as required by applicable laws.

 

(b)          Commercial
General Liability insurance, with limits of at least $2,000,000.00 per occurrence. The policy(ies) for such insurance shall: (i)
name Owner, Construction Lender and Development Manager as an additional insured,
(ii) be issued by insurers, and be in forms and for amounts, approved by Development Manager, (iii) be effected under valid and
enforceable policies issued by insurers of recognized responsibility, and (iv) provide that such policy(ies) shall not be canceled
without at least thirty (30) days’ prior written notice to Construction Lender
and Development Manager; provided, however, if the insurer will not commit to give such notice to both Construction Lander and
Development Manager, then Construction Lender will be entitled to such notice and Project Manager shall give immediate
notice to Development Manager of any cancellation.

 

(c)          Auto
Liability insurance with limits of at least $2,000,000 per occurrence. The policy(ies) for such insurance shall name the Development
Manager as an additional insured.

 

14.2         The
Development Manager shall place and maintain Builder’s Risk Property insurance covering the Project as a project expense.

 

ARTICLE XV

MISCELLANEOUS

 

15.1         This
Agreement and any Exhibits attached hereto represents the entire and integrated agreement between Development Manager and Project
Manager with respect to the development of the Project and supersedes all prior negotiations, representations or agreements, either
written or oral. This Agreement may be amended only by written instrument signed by both Development Manager and Project Manager.
The Project Manager shall have no right or interest in the Project, nor any claim of lien with respect thereto arising out of
this Agreement or the performance of its services or the services of any Affiliate (as hereinafter defined). The Project Manager
shall not file, and shall prevent any ArchCo Affiliate from filing, any lien against the Project.

 

    	 	16	 

     

    

 

15.2         In
performing its services hereunder, the Project Manager is and shall be, for federal tax purposes, an independent contractor and
not an employee or agent of the Development Manager or the Owner and the Project Manager is and shall be authorized to act as
the agent of the Development Manager solely to the extent required to perform the services and obligations set forth in this Agreement.

 

15.3         Project
Manager shall use commercially reasonable efforts to ensure that construction of the Project is effected in compliance with all
relevant provisions of the Construction Loan Documents disclosed to Project Manager.

 

15.4         The
Development Manager and Project Manager hereby agree that this Agreement and any and all liens, rights (including the right to
receive any and all fees) and interests ( whether choate or inchoate) owed, claimed or held by either such Manager in and to the
Project or the rent and revenue generated therefrom, are and shall be in all respects subordinate and inferior to the liens and
security interests created or to be created for the benefit of the Construction Lender under the Construction Loan Documents.

 

15.5         Whether
or not expressly required by the other provisions hereof, no approval by Development Manager shall be effective unless contained
in a writing signed by its Representative.

 

15.6         Nothing
contained herein shall be deemed to create any contractual relationship between Project Manager and any of the Contractors, subcontractors,
material suppliers, or consultants on the Project; nor shall anything contained herein be deemed to give any third party any claim
or right of action against Project Manager which does not otherwise exist without regard to this Agreement.

 

15.7         This
Agreement shall be governed under the laws of the State of North Carolina.

 

15.8         Time
is of the essence with respect to all matters set forth herein.

 

15.9         Any
obligation or liability whatsoever of either party hereto which may arise at any time under this Agreement or any obligation or
liability which may be incurred by it pursuant to any other instrument, transaction or undertaking contemplated hereby shall be
satisfied, if at all, only out of the assets of such party. No such obligation or liability shall be personally binding upon, nor
shall resort for the enforcement thereof be had to, the property of any of such party’s shareholders, trustees, officers,
employees or agents, regardless of whether such obligation or liability is in the nature of contract, tort or otherwise.

 

ARTICLE XVI

NOTICES

 

16.1         All
notices, requests, demands, and other communications required or permitted to be given under this instrument shall be in writing
and shall be conclusively deemed to have been duly given or delivered, as the case may be, (i) when hand delivered or sent by facsimile
(if confirmation of receipt has been received) to the addressee; (ii) upon transmission when sent in “PDF” format by
electronic mail electronic; (iii) three (3) business days after having been sent by certified mail, postage prepaid return receipt
requested; or (iv) one (1) business day after having been deposited, properly addressed and prepaid for guaranteed next-business-day
delivery, with a nationally-recognized overnight courier service. All such notices, requests, or demands shall be addressed as
set forth below, or to such other address as a party may from time to time designate by notice given to the other party(ies).

 

    	 	17	 

     

    

 

	If to Owner:	BRG Morehead Development
    Manager, LLC
	 	c/o Bluerock Real Estate, L.L.C.
	 	712 Fifth Avenue, 9th
    floor
	 	New York, New York 10019
	 	Attn:  R. Ramin Kamfar
    and James Babb
	 	Facsimile:  (212) 278-4220
	 	Email:  rkamfar@bluerockre.com and
	 	jbabb@bluerockre.com
	 	 
	With Copy to:	Michael Konig, Esq.
	 	c/o Bluerock Real Estate, L.L.C.
	 	712 Fifth Avenue, 9th
    floor
	 	New York, New York 10019
	 	Facsimile:  (212) 278-4220
	 	Email:  mkonig@bluerockre.com
	 	 
	If to Project Manager:	ArchCo WMH PM LLC
	 	Attention:  Neil T. Brown
	 	7 Piedmont Center
	 	Suite 300
	 	Atlanta, GA  30305
	 	Email:  neil@ntbrown.com
	 	 
	With Copy to:	ArchCo Residential LLC
	 	Attn:  Dorrie Green
	 	6820 Cypress Point North, #29
	 	Austin, TX  78746
	 	Email:  dgreen@archcoresidential.com

 

Any time period following
notice shall commence on the date of such delivery. Rejection or other refusal to accept or inability to deliver because of change
of address as to which no notice has been given shall constitute receipt of any such notice, demand or request.

    	 	18	 

     

    

 

IN WITNESS WHEREOF,
the parties hereby have executed this Agreement as of the day and year first set forth above.

 

	 	PROJECT MANAGER:
	 	 
	 	ARCHCO WMH PM LLC, 
	 	a Delaware limited liability company
	 	 	 	 
	 	By:	/s/ Neil T. Brown
	 	 	Name:	Neil T. Brown
	 	 	Title:	Authorized Signatory

 

     

     

    

 

	 	DEVELOPMENT MANAGER:
	 	 
	 	BRG MOREHEAD DEVELOPMENT MANAGER, LLC
	 	 	 	 
	 	By:	/s/ Michael Konig
	 	 	Name:	Michael Konig
	 	 	Title:	Authorized Signatory

 

OWNER HEREBY JOINS IN
THIS AGREEMENT FOR THE SOLE PURPOSE OF AGREEING TO BE BOUND BY THE TERMS OF SECTION 10.4.

 

	 	OWNER:
	 	 
	 	BR ARCHCO MOREHEAD, LLC, a Delaware limited liability company
	 	 	 	 
	 	By:	/s/ Michael Konig
	 	 	Name:	Michael Konig
	 	 	Title:	Authorized Signatory

 

     

     

    

 

EXHIBIT A

PROPERTY DESCRIPTION

 

West Morehead, Charlotte, North Carolina

 

PARCEL 1

BEGINNING at a point located at the intersection
of the southern margin of the right-of-way of West Morehead Street and the eastern margin of the right-of-way of South Summit Avenue,
thence from said Beginning point and with the eastern margin of the right-of-way of South Summit Avenue S 11-45 W. 220.0 ft. to
an iron located beneath the pavement in the northern margin of the Piedmont and Northern Railroad right-of-way; thence with said
right-of-way in two courses and distances as follows: (1) S. 78-15 E. 83.45 ft. to a point; (2) with the arc of a circular curve
to the left having a radius of 465.84 ft., a chord bearing and distance of N. 85-52-47 E. 254.39 feet and an arc distance of 257.66
ft. to an iron located beneath the pavement in the western margin of a paved 20 ft. alley way; thence with the western margin of
said alley way N. 03-10-25 W. 195.06 ft. to an iron pipe located in the southern margin of the right-of-way of West Morehead Street;
thence with said margin of West Morehead Street and with the arc of a circular curve to the right having a radius of 1263.11 ft.,
a chord bearing and distance of N. 86-02-44 W. 280.50 ft. and an arc distance of 281.08 ft. to the point and place of BEGINNING;
containing 1.5544 acres; as shown on a survey by R. B. Pharr & Associates, P.A., dated October 4, 1999, and being Lot 1 in
Block D of Wesley Heights as shown on a map recorded in Map Book 3 at Page 540 in the Office of the Register of Deeds for Mecklenburg
County, North Carolina.

 

PARCEL 2

BEGINNING at an iron stake in the easterly
margin of South Summit Avenue and the southerly margin of the P. and N. right of way, said point of beginning being S. 11-45 W.
245 feet from the southerly margin of West Morehead Street, thence, along the easterly margin of South Summit Avenue S. 11-45 W.
145 feet to a point in the northerly margin of Bryant Street; thence, along the northerly margin of Bryant Street, S. 78-15 E.
84.69 feet, to an iron stake and a point of curve; thence, with the arc of a circular curve to the left of radius of 1146.28 feet,
a distance of 333.11 feet, to an iron stake in the northerly margin of Bryant Street and the westerly margin of a twenty foot alley;
thence, with the westerly line of said alley N. 12-57 W. 183.51 feet to a point in the westerly margin of said alley and southerly
margin of P. and N. right of way; thence, along the southerly margin of said right of way and with the arc of a circular curve
to the right of radius 490.84 feet, a distance of 247.64 feet, a bearing and chord of S 85-12-08 W 245.01', to a point on curve
on said right of way; thence, along the southerly margin of P. and N. right of way N. 78-15 W. 101.59 feet to the point and place
of BEGINNING, said lot being designated as Lot 2, Block D, Wesley Heights, as shown in Map Book 3, Page 540, of the Mecklenburg
County Public Registry, North Carolina.

 

    	 	Exhibit A	 

     

    

 

PARCEL 3

BEGINNING at a #4 rebar located on the
northern margin of Bryant Street at the southeast corner of the property of Southern Apartment Group-49, LLC (Deed Book 28056,
Page 975); thence N. 12-57-00 W. 183.51’ to a #4 rebar; thence along a curve to the right, with a radius of 490.84, an arc
of 10.07’, and bearing and chord of S 70-09-42 W. 10.07’, to a computed point; thence S. 12-57-00 E. 186.09’
to a computed point, located on the northern margin of Bryant Street; thence with the northern margin of Bryant Street, along a
curve to the left, with a radius of 1146.28’, an arc of 10.09’, and bearing and chord of S. 84-50-51 W. 10.09’
to the point and place of BEGINNING, containing 0.042 acres, more or less.

 

PARCEL 4

BEGINNING at a nail in the Eastern margin
of S. Summit Avenue, said point being located S. 11-45-00 W. 220.00’ from a nail in the sidewalk located at the intersection
of the Eastern margin of S. Summit Avenue and the Southern margin of West Morehead Street; thence running with Lot #1, Block D,
Map Book 3, Page 540 (Mecklenburg County Registry) S. 78-15-00 E. 83.45’ to a point; thence continuing with Lot #1, along
a curve to the left having a radius of 465.84’, an arc length of 257.66’, a chord of 254.39’ and bearing of N.
85-52-47 E. to an old iron pipe; thence S. 06-46-31 E. 26.14’ to a #4 rebar located at the northeasternmost corner of Lot
#2-A, Map Book 3, Page 540; thence with the Northern boundary line of said Lot #2-A, along a curve to the right having a radius
of 490.84’, an arc length of 247.63’, a chord of 245.01’ and a bearing of S. 85-12-08 W. to a point; thence continuing
with Lot #2-A, N. 78-15-00 W. 101.59’ to a nail along the Eastern margin of S. Summit Avenue; thence with the margin of S.
Summit Avenue, N 11-45-00 E. 25.00’ to the point and place of BEGINNING, containing 0.201 acres, more or less, as shown on
a survey by Robert J. Dedmon Dated February 6, 2013.

 

    	 	Exhibit A	 

     

    

 

EXHIBIT B

DEVELOPMENT BUDGET

 

CAPITAL BUDGET SUMMARY

West Morehead Site

Charlotte, NC

Update

 

	 	 	Total	 	 	Cost Per	 	 	Cost Per	 
	Budget Category	 	Cost	 	 	Unit	 	 	NRSF	 
	 	 	 	 	 	 	 	 	 	 
	LAND COSTS	 	 	 	 	 	 	 	 	 	 	 	 
	Purchase Price & Deposits	 	$	5,500,000	 	 	$	19,164	 	 	$	22.26	 
	Commissions	 	 	-	 	 	 	-	 	 	 	-	 
	Closing Costs  & Title Insurance	 	 	73,875	 	 	 	257	 	 	 	0.30	 
	Other Land *	 	 	(899,149	)	 	 	(3,133	)	 	 	(3.64	)
	Property Taxes	 	 	106,824	 	 	 	372	 	 	 	0.43	 
	TOTAL LAND COSTS	 	$	4,781,551	 	 	$	16,660	 	 	$	19.35	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	SOFT COSTS	 	 	 	 	 	 	 	 	 	 	 	 
	Legal Costs	 	$	380,000	 	 	$	1,324	 	 	$	1.54	 
	Design Costs	 	 	2,138,032	 	 	 	7,450	 	 	 	8.65	 
	Permit & Fee Costs	 	 	484,000	 	 	 	1,686	 	 	 	1.96	 
	Marketing Costs	 	 	860,000	 	 	 	2,997	 	 	 	3.48	 
	Finance Costs	 	 	 	 	 	 	 	 	 	 	 	 
	Construction Loan Interest & Fees	 	 	915,322	 	 	 	3,189	 	 	 	3.70	 
	Misc. Financing Costs	 	 	80,316	 	 	 	280	 	 	 	0.33	 
	Other Soft Costs	 	 	 	 	 	 	 	 	 	 	 	 
	Development Fee	 	 	1,553,750	 	 	 	5,414	 	 	 	6.29	 
	Operating Deficits	 	 	53,280	 	 	 	186	 	 	 	0.22	 
	Soft Cost Contingency	 	 	1,148,000	 	 	 	4,000	 	 	 	4.65	 
	TOTAL SOFT COSTS	 	$	7,612,700	 	 	$	26,525	 	 	$	30.81	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	HARD COSTS	 	 	 	 	 	 	 	 	 	 	 	 
	GMAX Contract	 	$	38,080,457	 	 	$	132,685	 	 	$	154.10	 
	Hard Cost Contingency	 	 	2,284,827	 	 	 	7,961	 	 	 	9.25	 
	Builder’s Risk Insurance	 	 	357,876	 	 	 	1,247	 	 	 	1.45	 
	Construction Management Fee	 	 	409,512	 	 	 	1,427	 	 	 	1.66	 
	Misc. Hard Costs	 	 	228,000	 	 	 	794	 	 	 	0.92	 
	TOTAL HARD COSTS	 	$	41,360,673	 	 	$	144,114	 	 	$	167.37	 
	TOTAL EXPECTED INVESTMENT	 	$	53,754,923	 	 	$	187,299	 	 	$	217.52	 

 

    	 	Exhibit B	 

     

    

 

EXHIBIT C

CONSTRUCTION SCHEDULE

 

	 	 	Construction

 Start Date	 	First Units 

Date	 	
        50% Units

        Delivered

        Date
	 	
        100% Units

        Delivered

        Date

	West Morehead	 	 	 	 	 	 	 	 
	Target Date	 	Apr-16	 	Aug-17	 	Jan-18	 	May-18
	Default Date	 	TBD	 	TBD	 	TBD	 	TBD

 

NOTE: The Default Date will be updated concurrent
with the commencement of construction.

 

    	 	Exhibit CExhibit 10.360

 

AGREEMENT OF PURCHASE AND SALE

 

[1309 and 1331 West Morehead Street,
Charlotte NC;

811 and 829 South Summit Avenue, Charlotte,
NC]

 

ARTICLE 1. PROPERTY/PURCHASE
PRICE

 

1.1          Certain
Basic Terms.

 

(a)          Purchaser
and Notice Address:

 

	 	With a copy to:
	 	 
	ArchCo Residential LLC	Sherman & Howard L.L.C.
	Attn: Jason Jacobson  	Attn: Mike Shomo
	5925 Searl Terrace	633 Seventeenth Street, Suite 3000
	Bethesda, MD 20816 	Denver, CO 80202
	Telephone: (571) 220-4829	Telephone: (303) 299-8256
	E-mail: jasonjacobson23@gmail.com	E-mail: mshomo@shermanhoward.com
	 	 
	 	And with a copy to:
	 	 
	 	ArchCo Residential LLC
	 	Attn: Neil T. Brown
	 	7 Piedmont Center, Suite 300
	 	Atlanta, GA 30305
	 	Telephone: (571) 220-4829
	 	E-mail: neil@ntbrown.com

 

(b)          Seller
and Notice Address:

 

	 	With a copy to:
	 	 
	Southern Apartment Group-49, LLC	Moore & Van Allen PLLC
	Attn:  Shane Seagle	Attn:  Emily B. Reynolds
	1435 West Morehead Street, Suite 130	100 North Tryon Street, Suite 4700
	Charlotte, NC 28208	Charlotte, NC  28202
	Telephone: (704) 362-2400	Telephone:  704-331-3626
	E-mail: sseagle@southernapartmentgroup.com	E-mail:  emilyreynolds@mvalaw.com

 

(c)          Title
Company and Notice Address:

 

	Fidelity National Title	 
	Attn: Stephen B. Sanders	 
	4643 S. Ulster Street, Suite 500	 
	Denver, CO 80237	 
	Telephone: 303-889-8164	 
	E-mail: sbsanders@fnf.com	 

 

    	 	1	 

     

    

 

(d)          Escrow
Agent and Notice Address:

 

	Fidelity National Title	 
	Attn: Stephen B. Sanders	 
	4643 S. Ulster Street, Suite 500	 
	Denver, CO 80237	 
	Telephone: 303-889-8164	 
	E-mail: sbsanders@fnf.com	 

 

	 	(e)	Date of this Agreement:	The latest date of execution by the Seller or the Purchaser, as indicated on the signature page of this Agreement.
	 	 	 	 
	 	(f)	Purchase Price:	$5,500,000.00.  The Purchase Price assumes that the North Carolina Brownfields tax incentive will be available for the Proposed Project in the same magnitude and under conditions for eligibility that are no more restrictive than exist on the date of the Agreement.
	 	 	 	 
	 	(g)	Earnest Money:	Is defined in Section 1.3.
	 	 	 	 
	 	(h)	Operating Agreement Period:	The period ending 30 days after the Date of this Agreement.
	 	 	 	 
	 	(i)	Due Diligence Period:	The period ending 60 days after the Date of this Agreement.
	 	 	 	 
	 	(j)	Closing Date:	The earlier occurrence of (i) 120 days after the expiration of the Due Diligence Period (the “Outside Closing Date”) or (ii) within 15 days of the Purchaser’s receipt of the Development Approvals (defined in Section 2.4(a)), as the Closing Date may be extended under Section 2.4(c).
	 	 	 	 
	 	(k)	Broker:	Beau McIntosh of Capstone Apartment Partners.
	 	 	 	 
	 	(l)	Proposed Project:	A multifamily rental apartment complex consisting of approximately 283 units, pursuant to plans and specifications prepared by and satisfactory to Purchaser.  
	 	 	 	 
	 	(m)	Business Day:	Any day which is not (i) a Saturday, (ii) a Sunday or (iii) a holiday on which national banks operating in North Carolina, are authorized to be closed.

 

1.2           Property.
Subject to the terms and conditions of this Agreement, Seller shall sell to Purchaser, and Purchaser shall purchase from Seller,
all of Seller’s right, title and interest in and to the following property (collectively, the “Property”):

 

(a)          The
approximately 3.10 acres of land commonly known as 1309 and 1331 West Morehead Street and 811 and 829 South
Summit Avenue and located in Charlotte, North Carolina, as described in Exhibit A attached to this Agreement (the “Land”),
together with Seller’s right, title and interest in (i) all improvements located on the Land (the “Improvements”),
(ii) the easements, tenements, hereditaments, and appurtenances belonging or appertaining to the Land, (iii) adjacent
streets, alleys and rights-of-way, or other property abutting the Land, and (iv) any and all minerals and mineral rights,
water and water rights, wells, well rights and well permits, water and sewer taps, sanitary or storm sewer capacity or reservations
and rights under utility agreements with any applicable governmental or quasi-governmental entities or agencies with respect to
the providing of utility services to the Land (collectively, the “Real Property”).

 

    	 	2	 

     

    

 

(b)          All
equipment, machinery, furniture, furnishings, supplies and other tangible personal property owned by Seller, and used by Seller
exclusively in connection with the Real Property, if any, and Seller’s interest in any such property leased by Seller, now
or hereafter located in and used exclusively in connection with the operation, ownership or management of the Real Property (collectively,
the “Tangible Personal Property”).

 

(c)          All
intangible personal property related to the Real Property and the Improvements owned by Seller and used by Seller exclusively in
connection with the Land, if any, including, without limitation: all well permits, water and sewer taps, sanitary or storm sewer
capacity or reservations and rights under utility agreements with any applicable governmental or quasi-governmental entities or
agencies with respect to the providing of utility services to the Land; the plans and specifications and other architectural and
engineering drawings for the Improvements; warranties; contract rights related to the construction, operation, ownership or management
of the Real Property; the Development Approvals and all other governmental permits, approvals and licenses (to the extent assignable);
tenant lists and correspondence; and all records relating to the Property (collectively, the “Intangible Personal Property”).

 

1.3           Earnest
Money. Within five Business Days after receipt of a fully executed copy of this Agreement, Purchaser shall deposit $50,000
in good funds with the Escrow Agent as an earnest money deposit (the “First Deposit”). If this Agreement is not terminated
under Section 2.2(b), Purchaser shall deposit $150,000 in good funds with the Escrow Agent as an additional earnest money
deposit (the “Second Deposit”) before the end of the Due Diligence Period. Upon the expiration of the Due Diligence
Period, the Earnest Money becomes nonrefundable to Purchaser, except as otherwise expressly set forth in this Agreement. “Earnest
Money” means, collectively, the First Deposit, the Second Deposit once made by Purchaser, and each Extension Deposit
(defined in Section 2.4(c)) once made by Purchaser, together with interest on such amounts. The Earnest Money shall be applied
to the Purchase Price at Closing. If this Agreement terminates prior to the end of the Operating Agreement Period, the Escrow Agent
shall refund the Earnest Money to Purchaser immediately upon request, and all further rights and obligations of the parties under
this Agreement shall terminate, except those which by their terms survive any termination of this Agreement. Otherwise, the Escrow
Agent shall disburse the Earnest Money to Seller upon the Closing or as otherwise set forth in this Agreement upon the earlier
termination of this Agreement. The Escrow Agent shall hold and disburse the Earnest Money in accordance with Article 9
of this Agreement.

 

1.4           Independent
Contract Consideration. At the same time as the deposit of the Earnest Money to the Escrow Agent, Purchaser shall deliver to
Seller the sum of $100.00 (the “Independent Contract Consideration”) which amount has been bargained for and
agreed to as consideration for Purchaser’s exclusive option to purchase the Property and the Due Diligence Period as provided
in this Agreement, and for Seller’s execution and delivery of this Agreement. The Independent Contract Consideration is in
addition to and independent of all other consideration provided in this Agreement, and is nonrefundable in all events.

 

ARTICLE 2. INSPECTION
AND DEVELOPMENT APPROVALS

 

2.1           Seller’s
Delivery of Specified Documents. Within two Business Days after the date of this Agreement, Seller shall provide to Purchaser
the following information with respect to the Property (the “Property Information”) to the extent in
Seller’s possession or control: (i) any environmental reports and a schedule listing any such reports; (ii) maps
and surveys (including, without limitation, archaeological, boundary, topographic and tree surveys); (iii) Seller’s
existing title policy (iv) any soils and engineering reports; (v) any written notices, reports, citations, orders, zoning
letters, or decisions from any governmental authority; (vi) all agreements with or applications to, and responses and decisions
from, any governmental authority with respect to any zoning modification, variance, exception, platting or other matter relating
to the zoning, use, development, subdivision or platting of the Property; (vii) copies of all agreements, studies, reports,
correspondence and other documents relating to the presence or absence of any endangered species or environmentally sensitive areas
on the Property; (viii) any pleadings, judgments, court orders and settlement agreements relating to or resulting from legal
proceedings affecting the Property; and (ix) any leases, contracts or agreements relating to the Property or services being
provided or to be provided to the Property, including, without limitation, any agreements with electric, cable, gas, telephone
or other utility providers. Seller shall provide to Purchaser any documents described above and coming into Seller’s possession
or control or produced by Seller after the initial delivery above and shall continue to provide same during the pendency of this
Agreement. All property Information will be provided to Purchaser without any representation or warranty of any kind or nature
whatsoever and is merely provided to Purchaser for Purchaser’s information purposes. Until Closing, Purchaser and Purchaser’s
designees shall maintain all Property Information as confidential information; provided that Purchaser may disclose the Property
Information to (A) Purchaser’s employees, agents, advisors and consultants and potential investors and lenders having
a need to know about the same in connection with the investigation of the Property and the transactions contemplated under this
Agreement and Purchaser’s potential investment in and development of the Property, and (B) governmental agencies but
only to the extent necessary in connection with obtaining the Development Approvals. If the purchase and sale of the Property is
not consummated in accordance with this Agreement, regardless of the reason or the party at fault, Purchaser shall immediately
redeliver to Seller all copies of the Property Information, whether such copies were actually delivered by Seller or are duplicate
copies made by Purchaser or Purchaser’s designees.

 

    	 	3	 

     

    

 

2.2           Due
Diligence.

 

(a)          Purchaser
shall have through the last day of the Due Diligence Period in which to examine, inspect, and investigate the Property and, in
Purchaser’s sole and absolute judgment and discretion, to determine whether the Property is acceptable to Purchaser, whether
Purchaser is prepared to make an investment in the Property, and for Purchaser to obtain all necessary internal approvals.

 

(b)          If
Purchaser, in Purchaser’s sole and absolute judgment and discretion, determines that the Property is acceptable to Purchaser,
Purchaser shall deliver a written notice to Seller and Escrow Agent (a “Due Diligence Approval Notice”) and
shall deposit the Second Deposit with the Escrow Agent as additional Earnest Money within five Business Days after the end of the
Due Diligence Period. If Purchaser so deposits the Second Deposit with Escrow Agent, Purchaser and Seller shall proceed to Closing
in accordance with and subject to the terms and conditions of this Agreement. Notwithstanding anything to the contrary in this
Agreement, Purchaser may terminate this Agreement by giving notice of termination (a “Due Diligence Termination Notice”)
to Seller on or before the last day of the Due Diligence Period. If Purchaser fails to deposit the Second Deposit with Escrow Agent
in accordance with Section 1.3 or fails to deliver either a Due Diligence Approval Notice or a Due Diligence Termination Notice
to Seller and Escrow Agent in accordance with this Section 2.2(b), Purchaser shall be deemed to have delivered a Due Diligence
Termination Notice on the last day of the Due Diligence Period and Purchaser shall be deemed to have terminated this Agreement
effective as of the expiration of the Due Diligence Period.

 

(c)          Purchaser
and its agents, employees, and representatives shall have a continuing right of reasonable access to the Property during the pendency
of this Agreement for the purpose of conducting surveys, engineering, geotechnical, and environmental inspections and tests (including
intrusive inspection and sampling for which Purchaser shall obtain Seller’s prior written consent, which shall not be unreasonably
withheld or delayed), and any other inspections, studies, or tests reasonably required by Purchaser. In the course of its investigations
Purchaser may make inquiries to third parties including, without limitation, lenders, contractors, and municipal, local, and other
government officials and representatives, and Seller consents to such inquiries. Purchaser shall keep the Property free and clear
of any liens resulting from any such entry by Purchaser, its agents, employees, or representatives. If any inspection or test disturbs
the Property, Purchaser will promptly restore the Property to the same condition as existed prior to any such inspection or test.
Except as otherwise provided in connection with Seller’s consent for any intrusive inspection or sampling, any activities
by or on behalf of Purchaser, including, without limitation, the entry by Purchaser or Purchaser’s designees onto the Property,
or the other activities of Purchaser or Purchaser’s designees with respect to the Property (“Purchaser’s Activities”)
shall not damage the Property in any manner whatsoever. Further, Purchaser shall indemnify, defend and hold Seller harmless from
and against any and all claims, liabilities, damages, losses costs and expenses of any kind or nature whatsoever (including, without
limitation, attorney’s fees and expenses and court costs) (but excluding any claims, liabilities, damages, losses costs and
expenses arising from Purchaser’s mere discovery of any condition relating to the Property) suffered, incurred or sustained
by Seller and proximately caused by any Purchaser’s Activities. Notwithstanding any provision herein to the contrary. Purchaser’s
obligations under this Section 2.2(c) shall survive the Closing and any termination of this Agreement. Purchaser
shall copy Seller on any written reports or summaries prepared by or obtained from third parties (other than any attorney work
product or attorney-client communications) in connection with its due diligence. Further, Seller shall be a reliance party under
any reports obtained by Purchaser and Purchaser shall timely deliver a copy of the same to Seller.

 

    	 	4	 

     

    

 

(d)          Prior
to Purchaser and Purchaser’s designees entering onto the Property, Purchaser shall: (i) if Purchaser does not then have
such a policy in force, procure a policy of commercial general liability insurance issued by an insurer reasonably satisfactory
to Seller covering all Purchaser’s Activities with a single limit of liability (per occurrence and aggregate) of not less
than $1,000,000; (ii) deliver to Seller a Certificate of Insurance evidencing that such insurance is in force and effect and evidencing
that Seller has been named as an additional insured thereunder with respect to any Purchaser’s Activities (such Certificate
of Insurance shall be delivered to the attention of Scott Herr at the address for notices set forth below in Seller’s execution
of this Agreement). The policy of liability insurance required by this provision shall be written on an “occurrence”
basis and shall be maintained in force through the earlier of (y) the termination of this Agreement and the conclusion of all Purchaser’s
Activities, or (z) Closing.

 

2.3           Operating
Agreement. During the Operating Agreement Period, Seller and Purchaser shall negotiate the terms and conditions of an operating
agreement (the “New LLC Operating Agreement”) between them for a new single-asset Delaware limited liability
company (the “New LLC”) to be formed for the purpose of acquiring title to the Property at the Closing, in accordance
with this Agreement, and to develop and own the Proposed Project. The negotiations for the New LLC Operating Agreement shall be
based on the terms of the Letter of Intent for Joint Venture Participation attached as Exhibit D to this Agreement.
If Seller and Purchaser agree to the New LLC Operating Agreement during the Operating Agreement Period, (a) Seller and Purchaser
shall sign, before the end of the Operating Agreement Period, an amendment to this Agreement acknowledging their agreement to the
form of the New LLC Operating Agreement, (b) Seller and Purchaser (or an Affiliate (defined in Section 10.1) of
Purchaser) shall sign the New LLC Operating Agreement on or before the end of the Operating Agreement Period (provided that the
New LLC Operating Agreement shall by its terms become effective only upon the Closing), (c) Seller and Purchaser shall deliver
the New LLC Operating Agreement to the Escrow Agent upon execution, and the Escrow Agent shall hold the New LLC Operating Agreement
in escrow until Closing, and (d) simultaneously with the execution of the New LLC Operating Agreement, Purchaser, on its own
behalf and on behalf of the manager of the New LLC, shall execute an assignment and assumption of this Agreement (the “Assignment
and Assumption of Purchase Agreement”) which, by its terms, shall become effective only upon the Closing and by which
Purchaser shall assign to the New LLC, and the New LLC shall assume, Purchaser’s rights and obligations to purchase the Property
under this Agreement. If Seller and Purchaser do not agree to the form of the New LLC Operating Agreement by the end of the Operating
Agreement Period in accordance with this Section 2.3, this Agreement shall terminate, the Escrow Agent shall refund the Earnest
Money to Purchaser immediately upon request, and all further rights and obligations of the parties under this Agreement shall terminate,
except those which by their terms survive any termination of this Agreement.

 

2.4           Developmental
Approvals.

 

(a)          “Development
Approvals” means that the site plan, , zoning, platting, and all other applicable governmental approvals, permits, licenses
and easements (excluding only building permits) for the Proposed Project has been approved by the City of Charlotte without amendments
or conditions unacceptable to Purchaser, as determined by Purchaser in its sole discretion, and that all appeal periods with respect
to the Development Approvals shall have expired without any appeal having been filed or, if filed, such appeal shall have been
resolved to the satisfaction of Purchaser. Purchaser’s efforts to obtain the Development Approvals shall be at its sole cost
and expense (including the posting of any fiscal requirements). Development Approvals shall include, without limitation, any approvals
required under any declaration of covenants, conditions and restrictions or any other private agreement affecting the Property.

 

(b)          Seller
agrees to cooperate fully with and assist Purchaser in applying for and obtaining all Development Approvals. Seller shall execute
all documents required for the development approval process including the appointment of Purchaser as its agent or nominee to obtain
any Development Approvals. Purchaser shall provide Seller reasonable prior notice of all public hearings, city staff meetings,
or other meetings related to the approval of Purchaser’s application(s) and Seller shall attend any such meeting as may be
reasonably requested by Purchaser. Seller agrees to execute such plats, including any necessary lot splits, and make such dedications
as may be required whereby the Property shall be a “legal lot” under all applicable ordinances, laws, and regulations,
and Seller shall provide easements, in form and substance reasonably satisfactory to Purchaser, for access and utilities as may
be required in connection with the Development Approvals and as required by utility companies or any governmental authorities with
respect to the Proposed Project. Such plats and dedications shall be made and granted by Seller at such time as is required by
the applicable governmental authority. The Property description and Survey shall be revised to take into account de minimis changes
to the Property boundaries requested by Purchaser that are necessary to permit the development of the Proposed Project. Seller
shall not be required to incur any cost or expense to any third party in connection with its obligations under this Section 2.4(b).

 

    	 	5	 

     

    

 

(c)          If
Purchaser determines at any time that it has been or will be unable to achieve the Development Approvals by the Outside Closing
Date, then Purchaser may, by delivering written notice to Seller, (i) terminate this Agreement (such notice is a “Development
Approvals Termination Notice”); (ii) waive such condition and proceed with the Closing on such date to which the
parties may mutually agree, but in any event, no later than the Outside Closing Date set forth in Section 1.1(j); or
(iii) extend the Outside Closing Date up to two times in order to achieve Final Approval of the Development Approvals, each
such extension not to exceed 30 days. In the event Purchaser desires to exercise such extension rights, Purchaser shall give
written notice (each such notice, the “Outside Closing Date Extension Notice”) to Seller and the Escrow Agent
on or before five calendar days prior to the Outside Closing Date (or extended Outside Closing Date, if Purchaser has previously
extended the Outside Closing Date). Additionally, within two Business Days of delivery of each Outside Closing Date Extension Notice,
Purchaser shall deposit an additional $20,000 in good funds with the Escrow Agent for each extension period (each, an “Extension
Deposit”) to serve as additional Earnest Money. If Purchaser delivers an Outside Closing Date Extension Notice, but does
not deposit $20,000 with Escrow Agent in accordance with this Section 2.4(c), Purchaser shall be deemed to have terminated this
Agreement in accordance with this Section 2.4(c). If the Development Approvals have not occurred by the final extended Outside
Closing Date, Purchaser shall on such date either waive such conditions and close under this Agreement or terminate this Agreement
by sending a Development Approvals Termination Notice to the Seller. If Purchaser terminates this Agreement under this Section 2.4(c),
the Escrow Agent shall disburse the Earnest Money, and any applicable Extension Deposits, to Seller, and all further rights and
obligations of the parties under this Agreement shall terminate, except those which by their terms survive any termination of this
Agreement.

 

2.5           Adverse
Conditions. As a condition to Purchaser’s obligation to close, there shall be no material change in any condition of
or affecting the Property not caused by Purchaser or its contractors, employees, affiliates or other related or similar parties,
that has occurred after the Due Diligence Period including without limitation (i) any dumping or discovery of refuse or environmental
contamination; (ii) access; (iii) the availability, adequacy or cost of or for all utilities (including without limitation,
water, sanitary sewer, storm sewer, gas, electric, cable and any other utilities required to serve or service the Property) that
will be necessary to serve the Proposed Project; (iv) the imposition of any moratorium which would prohibit or delay the commencement
of construction; or (v) the solvency and financial condition of any taxing districts to which the Property is subject, the
existing and projected mill levies assessed by such districts, or the ability and capacity of any of such districts to service
the Proposed Project. It shall also be a condition to Purchaser’s obligation to close that there shall be no offsite obligations
required in connection with the development of the Proposed Project, other than those required for the Development Approvals, and
applicable water, sewer and impact fees charged by the applicable governmental authorities shall not have increased over the levels
assessed as of the date of this Agreement.

 

ARTICLE 3. TITLE AND
SURVEY REVIEW

 

3.1           Delivery
of Title Commitment and Survey. Purchaser shall cause to be prepared: (i) within five Business Days after the date of
this Agreement, a current, effective commitment for title insurance (the “Title Commitment”) issued by the Title
Company, in the amount of the Purchase Price with Purchaser as the proposed insured, and accompanied by true, complete, and legible
copies of all documents referred to in the Title Commitment; and (ii) a current ALTA/ACSM survey of the Property (the “Survey”)
including a certification addressed to Purchaser and Seller.

 

3.2           Title
Review and Cure. During the Due Diligence Period, Purchaser shall review title to the Property as disclosed by the Title Commitment
and the Survey. Seller will cooperate with Purchaser in curing any objections Purchaser may have to title to the Property; provided
Seller shall have no obligation to incur any cost or expense to any third party in connection with such cooperation other than
costs and expenses Seller may incur in connection with the title objections that Seller is obligated to cure under this Section 3.2.
Seller shall have no obligation to cure title objections except (a) liens or exceptions for delinquent property taxes and
assessments and related penalties, (b) deeds of trust and mortgages, (c) mechanics’ liens, (d) other monetary
liens, and (e) any exceptions or encumbrances to title which are created by, through or under Seller after the date of this
Agreement without the written consent of Purchaser, all of which shall be removed from title to the Property by the Closing Date.
Without limiting Seller’s obligations in the prior sentence or elsewhere in this Agreement or Purchaser’s remedies
under Section 8.1, Purchaser may terminate this Agreement and receive a refund of the Earnest Money if the Title Company
revises the Title Commitment after the expiration of the Due Diligence Period to add or modify exceptions or to delete or modify
the conditions to obtaining any endorsement requested by Purchaser during the Due Diligence Period if such additions, modifications
or deletions are not acceptable to Purchaser and Seller does not cure any such matter within five Business Days after Purchaser
gives written notice to Seller of such matter but, in any event, not later than the Closing Date. “Permitted Exceptions”
means (i) the specific exceptions (exceptions that are not part of the promulgated title insurance form) in the Title Commitment
that Purchaser has approved as of the expiration of the Due Diligence Period and that Seller is not required to remove as provided
above, and (ii) real estate taxes not yet due and payable.

 

    	 	6	 

     

    

 

3.3           Delivery
of Title Policy at Closing. At Closing, as a condition to Purchaser’s obligation to close, the Title Company shall deliver
to Purchaser an ALTA (or other form required by state law) Owner’s Policy of Title Insurance (“Title Policy”)
issued by the Title Company with ALTA General Exceptions 1 through 5 deleted (or corresponding deletions or endorsements
if the Property is located in a non-ALTA state), containing the Purchaser’s Endorsements, dated the date and time of the
recording of the Deed in the amount of the Purchase Price, insuring Purchaser as owner of good, marketable and indefeasible fee
simple title to the Property, subject only to the Permitted Exceptions. “Purchaser’s Endorsements” means,
to the extent such endorsements are available under the laws of the state in which the Property is located: (a) owner’s
comprehensive; (b) access; (c) survey (accuracy of survey); (d) location (survey legal matches title legal); (e) separate
tax lot; (f) legal lot; (g) zoning 3.0; and (h) such other endorsements as Purchaser may require based on its review
of the Title Commitment and Survey. Seller shall execute at Closing an affidavit on the Title Company’s standard form so
that the Title Company can delete or modify the standard printed exceptions as to parties in possession, unrecorded liens, and
similar matters and, if required to issue the Title Policy at Closing, the customary gap indemnity. The Title Policy may be delivered
after the Closing if at the Closing the Title Company issues a currently effective, duly-executed “marked-up” Title
Commitment and irrevocably commits in writing to issue the Title Policy in the form of the “marked-up” Title Commitment
promptly after the Closing Date.

 

3.4           Title
and Survey Costs. The cost of the Survey and the premium for the Title Policy, including any search and exam fees and the premium
for the Purchaser’s Endorsements, shall be paid by the Purchaser.

 

ARTICLE 4. OPERATIONS
AND RISK OF LOSS

 

4.1           Performance
under Contracts. During the pendency of this Agreement, Seller will perform its material obligations under agreements that
affect the Property.

 

4.2           New
Contracts. During the pendency of this Agreement, Seller will not enter into any lease or contract that will be an obligation
affecting the Property after the Closing without Purchaser’s prior written consent.

 

4.3           Listings
and Other Offers. Purchaser acknowledges that Seller has listed the Property with the Broker. During the pendency of this Agreement,
Seller will not list the Property with any other broker or and will not solicit or make or accept any offers to sell the Property,
engage in any negotiations with any third party with respect to the sale or other disposition of the Property, or enter into any
other brokerage contracts or agreements (whether binding or not) regarding any disposition of the Property.

 

4.4           Seller’s
Obligations. Other than the obligations of Seller expressly assumed by Purchaser, Seller, subject to the terms and conditions
of this Agreement, covenants that it shall pay and discharge any and all liabilities of each and every kind arising out of or by
virtue of the conduct of its business, if the same do or could constitute a lien on the Property, before and as of the Closing
Date on or related to the Property. The provisions of this Section 4.4 shall survive the Closing.

 

4.5           Condemnation.
By notice to Seller given within 10 days after Purchaser receives notice of proceedings in eminent domain that are contemplated,
threatened or instituted by any applicable governmental or other authority having the power of eminent domain, and if necessary
the Closing Date shall be extended to give Purchaser the full 10-day period to make such election, Purchaser may: (i) terminate
this Agreement and the Earnest Money shall be immediately returned to Purchaser; or (ii) proceed under this Agreement, in
which event Seller shall, at the Closing, assign to Purchaser its entire right, title and interest in and to any condemnation award,
and Purchaser shall have the right subject to Seller’s reasonable consent during the pendency of this Agreement to negotiate
and otherwise deal with the condemning authority with respect to such eminent domain proceedings.

 

    	 	7	 

     

    

 

ARTICLE 5. CLOSING

 

5.1           Closing.
The consummation of the transaction contemplated in this Agreement (“Closing”) shall occur on the Closing Date
at the offices of the Escrow Agent. Closing shall occur through an escrow with the Escrow Agent. The balance of the Purchase Price,
plus or minus prorations, shall be deposited into and held by Escrow Agent in a closing escrow account with a bank satisfactory
to Purchaser and Seller. Upon satisfaction or completion of all closing conditions and deliveries, the parties shall direct the
Escrow Agent to immediately record and deliver the closing documents to the appropriate parties and make disbursements according
to the closing statements executed by Seller and Purchaser. The Escrow Agent and the Title Company shall agree in writing with
Purchaser that (a) recordation of the Deed constitutes the Escrow Agent’s representation that it is holding the closing
documents, closing funds and closing statement and is prepared and irrevocably committed to disburse the closing funds in accordance
with the closing statement and (b) upon the Escrow Agent’s release of funds to Seller, the Title Company shall be irrevocably
committed to issue the Title Policy in accordance with this Agreement.

 

5.2           Conditions
to the Parties’ Obligations to Close.

 

(a)          In
addition to all other conditions set forth in this Agreement, the obligation of Seller, on the one hand, and Purchaser, on the
other hand, to consummate the transactions contemplated under this Agreement shall be conditioned on the following:

 

(1)         The
other party’s representations and warranties contained in this Agreement shall be true and correct as of the date of this
Agreement and the Closing Date. For purposes of this Section 5.2(a)(1), if a representation is made to knowledge, but the
factual matter that is the subject of the representation is false notwithstanding any lack of knowledge or notice to the party
making the representation, such event shall constitute a failure of this condition only, and not a default by the party making
such representation;

 

(2)         As
of the Closing Date, the other party shall have performed its obligations under this Agreement and all deliveries to be made at
Closing have been tendered (including, without limitation, the execution of the New LLC Operating Agreement and the Assignment
and Assumption of Purchase Agreement);

 

(3)         There
shall exist no pending or threatened actions, suits, arbitrations, claims, attachments, proceedings, assignments for the benefit
of creditors, insolvency, bankruptcy, reorganization or other proceedings, pending or threatened against the other party or the
Property that would materially and adversely affect the other party’s ability to perform its obligations under this Agreement;
and

 

(4)         There
shall exist no pending or threatened action, suit or proceeding with respect to the other party before or by any court or administrative
agency which seeks to restrain or prohibit, or to obtain damages or a discovery order with respect to, this Agreement or the consummation
of the transactions contemplated under this Agreement.

 

(b)          
In addition to all other conditions set forth in this Agreement, the obligation of Purchaser to consummate the transactions contemplated
under this Agreement shall also be conditioned on the following:

 

(1)         There
shall exist no actions, suits, arbitrations, claims, attachments, proceedings, assignments for the benefit of creditors, insolvency,
bankruptcy, reorganization or other proceedings, pending or threatened against the Property that would materially and adversely
affect the Property, the operation of the Property or Purchaser’s Proposed Project;

 

(2)         There
shall exist no pending or threatened moratorium on development or other governmental or quasi-governmental action which could prohibit
or delay Purchaser’s development of the Proposed Project that has arisen since the expiration of the Due Diligence Period.

 

    	 	8	 

     

    

 

(3)         The
availability, adequacy and cost of all utilities (including without limitation, water, sanitary sewer, storm sewer, gas, electric,
cable and any other utilities) to serve or service the Proposed Project shall not have materially changed since the expiration
of the Due Diligence Period.

 

(4)         There
shall exist no new special assessments, or any additional amounts for special assessments currently assessed, that are payable
with respect to the Property other than any special assessments that existed as of the expiration of the Due Diligence Period.

 

(5)         The
availability and magnitude of, and the conditions for eligibility for, the North Carolina Brownfields tax incentive with respect
to the Proposed Project shall not have materially changed since the expiration of the Due Diligence Period, excluding any changes
resulting from the actions of Purchaser.

 

(c)          So
long as a party is not in default under this Agreement, if any condition to that party’s obligation to proceed with the Closing
under this Agreement has not been satisfied as of the Closing Date, the
party may, in its sole discretion, elect to (i) terminate this Agreement by delivering written notice to the other party on
or before the Closing Date, (ii) extend the Closing until such condition is satisfied, or (iii) consummate this transaction
notwithstanding the non-satisfaction of such condition, in which event the party shall be deemed to have waived any such condition.
If a party elects to close, notwithstanding that a condition to that party’s obligation to proceed with the Closing has not
been satisfied, the other party shall have no liability for breaches of representations and warranties of which the party electing
to close had actual knowledge at the Closing. If Purchaser terminates this Agreement under this Section 5.2, the Escrow Agent
shall refund the Earnest Money to Purchaser, and all further rights and obligations of the parties under this Agreement shall terminate,
except those which by their terms survive any termination of this Agreement and as otherwise provided in this Section 5.2(c).
Notwithstanding the foregoing provisions of this Section 5.2(c), the failure of a condition due to the breach of a party shall
not relieve the breaching party from any liability it would otherwise have under this Agreement.

 

5.3           Seller’s
Deliveries in Escrow. On or prior to the Closing Date, Seller shall deliver in escrow to the Escrow Agent the following:

 

(a)          New
LLC Operating Agreement. A counterpart of the New LLC Operating Agreement, in the form agreed upon by Seller and Purchaser
under Section 2.3, executed by Seller as a member of the New LLC.

 

(b)          Deed.
A special warranty deed in the form attached hereto as Schedule 5.3, executed and acknowledged by Seller, conveying to Purchaser
good, indefeasible and marketable fee simple title to the Property, subject only to the Permitted Exceptions (the “Deed”).

 

(c)          Bill
of Sale. A Bill of Sale and Assignment in the form of Exhibit B attached hereto (the “Bill of Sale”),
executed and acknowledged by Seller.

 

(d)          Plat.
If any plats or approvals required in connection with the Development Approvals are to be recorded at or immediately after the
Closing, the final executed plat or approvals in form for recording according to applicable law to the extent that Seller’s
signature is required hereunder. For the avoidance of doubt, Purchaser shall be responsible for obtaining, and all expenses associated
with obtaining and recording, any such plats or approvals.

 

(e)          State
Law Disclosures. Such disclosures and reports, required by applicable state and local law in connection with the conveyance
of real property.

 

(f)          FIRPTA.
A Foreign Investment in Real Property Tax Act (“FIRPTA”) certificate of non-foreign status in the form attached
to this Agreement as Exhibit C and executed by Seller. If Seller fails to provide the FIRPTA certification on the Closing
Date, Purchaser may proceed with withholding provisions as provided by law.

 

(g)          Certificate
of Representations and Warranties. A certificate executed by Seller, reaffirming and updating to the Closing Date the representations
and warranties given by Seller under Section 7.1.

 

    	 	9	 

     

    

 

(h)          Authority.
Evidence of the existence, organization, and authority of Seller and the authority of the person executing documents on behalf
of Seller reasonably satisfactory to Purchaser, the Escrow Agent, and the Title Company.

 

(i)          Additional
Documents. Any additional documents that Purchaser, the Escrow Agent or the Title Company may reasonably require for the proper
consummation of the transaction contemplated by this Agreement.

 

5.4           Purchaser’s
Deliveries in Escrow. On or prior to the Closing Date, Purchaser shall deliver in escrow to the Escrow Agent the following:

 

(a)          New
LLC Operating Agreement. A counterpart of the New LLC Operating Agreement, in the form agreed upon by Seller and Purchaser
under Section 2.3, executed by Purchaser as a member and as the manager of the New LLC.

 

(b)          Assignment
and Assumption of Purchase Agreement. The Assignment and Assumption of Purchase Agreement, executed by Purchaser on its own
behalf, as assignor, and on behalf of the manager of the New LLC, as assignee.

 

(c)          Purchase
Price. The Purchase Price, less the Earnest Money, plus or minus applicable prorations, deposited by Purchaser with the Escrow
Agent in immediate, same day federal funds wired for credit into the Escrow Agent’s escrow account.

 

(d)          State
Law Disclosures. Such disclosures and reports required by applicable state and local law in connection with the conveyance
of real property.

 

(e)          Additional
Documents. Any additional documents that Seller, the Escrow Agent or the Title Company may reasonably require for the proper
consummation of the transaction contemplated by this Agreement.

 

5.5           Closing
Statements. At Closing, Seller and Purchaser shall deposit with the Escrow Agent executed closing statements consistent with
this Agreement in form required by the Escrow Agent. If Seller and Purchaser cannot agree on the closing statements to be deposited
as aforesaid because of a dispute over the prorations and adjustments set forth in the closing statements, the Closing nevertheless
shall occur, and the amount in dispute shall be withheld from the Purchase Price and placed in an escrow with the Escrow Agent,
to be paid out upon the joint direction of the parties or pursuant to court order upon resolution or other final determination
of the dispute.

 

5.6           Title
Policy. The Title Company shall deliver to Purchaser the Title Policy pursuant to Section 3.3.

 

5.7           Possession.
Seller shall deliver possession of the Property to Purchaser at the Closing subject only to the Permitted Exceptions.

 

5.8           Costs.
Seller shall pay (a) the cost of recording the Deed and any other document required to be recorded in connection the title
objections that Seller is obligated to cure under Section 3.2, and (b) excise taxes required to be paid in association
with the Deed. The Escrow Agent’s fee shall be evenly divided between Purchaser and Seller.

 

ARTICLE 6. PRORATIONS

 

6.1           Proration
of Taxes and Assessments. Purchaser shall receive a credit for any accrued but unpaid general real estate taxes and assessments
(including without limitation any assessments imposed by private covenant, “Taxes”) applicable to any period
before the Closing Date, even if such Taxes are not yet due and payable. If the amount of any Taxes has not been determined as
of Closing, such credit shall be based on the amount of the most recent ascertainable Taxes and shall be reprorated upon issuance
of the final tax bill. Purchaser shall receive a credit for any special assessments which are levied or charged against the Property,
whether or not then due and payable. The provisions of this Section 6.1 shall survive the Closing.

 

    	 	10	 

     

    

 

6.2           Commissions.
Seller and Purchaser represent and warrant each to the other that they have not dealt with any real estate broker, sales person
or finder in connection with this transaction other than Broker. If this transaction is closed, Seller shall pay Broker in accordance
with their separate agreement. Broker is an independent contractor and is not authorized to make any agreement or representation
on behalf of either party. Except as expressly set forth above, in the event of any claim for broker’s commissions, finder’s
fees or similar compensation in connection with the negotiation, execution or consummation of this Agreement or the transactions
contemplated under this Agreement, each party shall indemnify and hold harmless the other party from and against any such claim
based upon any statement, representation or agreement of the indemnifying party. The provisions of this Section 6.2
shall survive the Closing or termination of this Agreement.

 

6.3           Other
Expenses. Unless otherwise expressly agreed in writing between Seller and Purchaser, no other expense related to the ownership
or operation of the Property shall be charged to or paid or assumed by Purchaser, whether allocable to any period before or after
the Closing.

 

ARTICLE 7. REPRESENTATIONS
AND WARRANTIES

 

7.1           Seller’s
Representations and Warranties. As a material inducement to Purchaser to execute this Agreement and consummate this transaction,
Seller represents and warrants to Purchaser that:

 

(a)          Authority.
Seller is the sole owner of fee simple title to the Property. Seller has been duly organized and is validly existing as a North
Carolina limited liability company, is in good standing in the state of its organization and is qualified to do business, and is
in good standing, in the state in which the Property is located. Seller has the full right and authority and has obtained any and
all consents required to authorize Seller to enter into this Agreement, consummate or cause to be consummated the sale of the Property
and make or cause to be made transfers and assignments contemplated in this Agreement. The persons signing this Agreement on behalf
of Seller are authorized to do so. This Agreement has been, and the documents to be executed by Seller pursuant to this Agreement
will be, authorized and properly executed and does and will constitute the valid and binding obligations of Seller, enforceable
against Seller in accordance with their terms.

 

(b)          Conflicts
and Pending Actions or Proceedings. There is no agreement to which Seller is a party or, to Seller’s knowledge, binding
on Seller which is in conflict with this Agreement. There is no action or proceeding pending or, to Seller’s knowledge, threatened
against or relating to the Property, which challenges or impairs Seller’s ability to execute or perform its obligations under
this Agreement.

 

(c)          Agreements
with Governmental Authorities/Restrictions. Except as included in the Property Information delivered to Purchaser or as may
be entered into by Purchaser in connection with Purchaser’s obtaining the Development Approvals, Seller has not entered into,
and has no knowledge of, any agreement with or application to any governmental authority with respect to any zoning modification,
variance, exception, platting or other matter. To Seller’s knowledge, neither Seller nor the Property is in violation or
non-compliance with any restriction or covenant affecting the Property.

 

(d)          Condemnation.
To Seller’s knowledge, no condemnation, eminent domain or similar proceedings are pending or threatened with regard to the
Property.

 

(e)          Property
Rights. To the Seller’s actual knowledge, except as disclosed in the Property Information, no person or entity holds
any lease, easement or any other right to use or occupy the Property.

 

(f)          Notice
of Special Assessments. Seller has not received any notice and has no knowledge of any pending or threatened liens, special
assessments, condemnations, impositions or increases in assessed valuations to be made against the Property by any governmental
authority.

 

(g)          Zoning.
Seller has no knowledge of any pending or threatened zoning change, other than actions to be taken by Purchaser in connection with
securing the Development Approvals.

 

    	 	11	 

     

    

 

(h)          FEMA
Flood Maps. Seller discloses to Purchaser that FEMA flood maps applicable to the Property are changing and will go into effect
in October, 2015. The changes to the FEMA flood maps will affect the Property unless the site plan for the Proposed Project is
submitted for approval prior to end of August, 2015.

 

(i)          Property
Information. To Seller’s actual knowledge, the Property Information contains all material documents, files, written information,
books and records in Seller’s possession or control and relating to the obtainment of the Development Approvals or required
to be delivered to Purchaser under Section 2.1. If Purchaser requests other material information relating to the Property
and Seller possesses or controls the requested information, then Seller shall disclose such information within two Business Days
of such request for disclosure.

 

(j)          Environmental.
Seller has no knowledge of any violation of Environmental Laws (defined below) related to the Property or the presence or release
of Hazardous Materials (defined below) on or from the Property except as disclosed in the Property Information. As disclosed in
the Property Information, Seller notified Purchaser that a North Carolina Brownfields Property Agreement was recorded on Property
on May 20, 2014. Seller has not manufactured, introduced, released or discharged from or onto the Property any Hazardous Materials
or any toxic wastes, substances or materials (including, without limitation, asbestos), and Seller has not used the Property or
any part of the Property for the generation, treatment, storage, handling or disposal of any Hazardous Materials, in violation
of any Environmental Laws. The term “Environmental Laws” includes without limitation the Resource Conservation
and Recovery Act and the Comprehensive Environmental Response Compensation and Liability Act and other federal laws governing the
environment as in effect on the date of this Agreement together with their implementing regulations and guidelines as of the date
of this Agreement, and all state, regional, county, municipal and other local laws, regulations and ordinances that are equivalent
or similar to the federal laws recited above or that purport to regulate Hazardous Materials. The term “Hazardous Materials”
includes petroleum, including crude oil or any fraction thereof, natural gas, natural gas liquids, liquefied natural gas, or synthetic
gas usable for fuel (or mixtures of natural gas or such synthetic gas), asbestos and asbestos containing materials and any substance,
material waste, pollutant or contaminant listed or defined as hazardous or toxic under any Environmental Law.

 

(k)          Withholding
Obligation. Seller’s sale of the Property is not subject to any federal, state or local withholding obligation of Purchaser
under the tax laws applicable to Seller or the Property.

 

(l)          ERISA.
Seller is not (i) an “employee benefit plan” (within the meaning of section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”)) that is subject to the provisions of Title I of ERISA, (ii) a
“plan” that is subject to the prohibited transaction provisions of section 4975 of the Internal Revenue Code of
1986 (the “Code”) or (iii) an entity whose assets are treated as “plan assets” under ERISA
by reason of an employee benefit plan’s or plan’s investment in such entity.

 

(m)          Anti-Money
Laundering Laws. To Seller’s actual knowledge, without any duty of investigation, Seller: (i) is not under investigation
by any governmental authority for, or has been charged with, or convicted of, money laundering, drug trafficking, terrorist-related
activities, any crimes which in the United States would be predicate crimes to money laundering, or any violation of any Anti Money
Laundering Laws (defined below); (ii) has not been assessed civil or criminal penalties under any Anti-Money Laundering Laws;
or (iii) has not had any of its funds seized or forfeited in any action under any Anti Money Laundering Laws. The term “Anti-Money
Laundering Laws” means all applicable laws, regulations and sanctions, state and federal, criminal and civil, that: (1) limit
the use of and/or seek the forfeiture of proceeds from illegal transactions; (2) limit commercial transactions with designated
countries or individuals believed to be terrorists, narcotics dealers or otherwise engaged in activities contrary to the interests
of the United States; (3) require identification and documentation of the parties with whom a financial institution conducts
business; or (4) are designed to disrupt the flow of funds to terrorist organizations.

 

(n)          Moratoria.
To the Seller’s actual knowledge, there exists no pending or threatened moratorium on the Property.

 

    	 	12	 

     

    

 

7.2           Disclaimer.
Except as expressly provided in this Agreement or the Deed or other documents executed and delivered by Seller at the Closing,
Seller does not make any representation or warranty, express or implied, of any kind or nature whatsoever, with respect to the
Property, and all such warranties are hereby disclaimed. Purchaser agrees that it has not relied upon and will not rely upon, either
directly or indirectly, any representation or warranty of Seller except those representations expressly made in this Agreement
or the Deed or other documents executed and delivered by Seller at the Closing. Except as expressly provided in this Agreement
or the Deed or other documents executed and delivered by Seller at the Closing, Seller shall sell and convey to Purchaser and Purchaser
shall accept the Property AS-IS, WHERE-IS AND WITH ALL FAULTS, and Purchaser hereby expressly waives, releases and discharges any
claim that it has, might have had or may have against Seller with respect to the Property. Further, no member, manager or other
constituent of either Seller or Purchaser (respectively, “Affiliated Parties”) shall have any personal liability
under this Agreement or with respect to the Property or the subject transaction and each of Seller and Purchaser waives, releases
and discharges any claim that it has, might have had or may have against any of the other’s Affiliated Parties. The terms
of this paragraph shall expressly survive the consummation of the transaction and the sale of the Property regardless of whether
the same are incorporated into the Deed.

 

7.3           Purchaser’s
Representations and Warranties. As a material inducement to Seller to execute this Agreement and consummate this transaction,
Purchaser represents and warrants to Seller that:

 

(a)          Organization
and Authority. Purchaser has been duly organized and is validly existing as a limited liability company in good standing in
the State of Delaware, and qualified to do business in the state in which the Property is located. Subject only to obtaining certain
internal approvals on or before the expiration of the Due Diligence Period, Purchaser has the full right and authority and has
obtained any and all consents required to authorize Purchaser to enter into this Agreement, consummate or cause to be consummated
the purchase of the Property. This Agreement and all of the documents to be delivered by Purchaser at the Closing have been and
will be authorized and properly executed and will constitute the valid and binding obligations of Purchaser, enforceable in accordance
with their terms.

 

(b)          Conflicts
and Pending Action. There is no agreement to which Purchaser is a party or to Purchaser’s knowledge binding on Purchaser
which is in conflict with this Agreement. There is no action or proceeding pending or to Purchaser’s knowledge, threatened,
against Purchaser which challenges or impairs Purchaser’s ability to execute or perform its obligations under this Agreement.

 

(c)          ERISA.
Purchaser is not (i) an “employee benefit plan” (within the meaning of section 3(3) of ERISA) that is subject
to the provisions of Title I of ERISA, (ii) a “plan” that is subject to the prohibited transaction provisions
of section 4975 of the Code or (iii) an entity whose assets are treated as “plan assets” under ERISA by reason
of an employee benefit plan’s or plan’s investment in such entity.

 

(d)          Compliance
with International Trade Control Laws and OFAC Regulations. Purchaser (without reference to its constituent entities) is not
now nor shall it be at any time prior to or at the Closing a Person named in any executive orders or lists published by OFAC as
a Specially Designated National and Blocked Person. To Purchaser’s actual knowledge, without any duty of investigation, Purchaser:
(i) is not under investigation by any governmental authority for, or has been charged with, or convicted of, money laundering,
drug trafficking, terrorist-related activities, any crimes which in the United States would be predicate crimes to money laundering,
or any violation of any Anti Money Laundering Laws; (ii) has not been assessed civil or criminal penalties under any Anti-Money
Laundering Laws; or (iii) has not had any of its funds seized or forfeited in any action under any Anti Money Laundering Laws.

 

7.4           Survival
of Representations and Warranties. The representations and warranties set forth in this Article 7 are made as of
the date of this Agreement and are remade as of the Closing Date and shall not be deemed to be merged into or waived by the instruments
of Closing, but shall survive the Closing for a period of one year. Seller and Purchaser shall have the right to bring an action
on a breach of a representation or warranty in this Article 7 only if Seller or Purchaser, as the case may be, has
given the other party written notice of the circumstances giving rise to the alleged breach within such one year period. Each party
agrees to defend and indemnify the other against any claim, liability, damage or expense asserted against or suffered by such other
party arising out of the breach or inaccuracy of any such representation or warranty.

 

    	 	13	 

     

    

 

ARTICLE 8. DEFAULT
AND REMEDIES

 

8.1           Seller’s
Default. If this transaction fails to close as a result of Seller’s default, the Earnest Money shall be returned
to Purchaser. In addition, Purchaser shall be entitled to such remedies for breach of contract as may be available at law and in
equity, including without limitation, the remedy of specific performance. If this transaction fails to close as a result of Seller’s
default, Purchaser may (i) terminate this Agreement by written notice to Seller, Escrow Agent and the Title Company, and Escrow
Agent shall refund the Earnest Money to Purchaser; (ii) waive such default and consummate the transaction contemplated by this
Agreement in accordance with the terms of this Agreement; or (iii) institute all proceedings necessary to specifically enforce
the terms of this Agreement and cause title to Property to be conveyed to Purchaser. Seller and Purchaser agree that the Property
is unique and that the right of specific performance is a just and equitable remedy under the circumstances. If, however, the remedy
of specific performance is not available to Purchaser, Purchaser shall be entitled to recover Purchaser’s actual and incidental
damages (and not including consequential or punitive damages) and an amount equal to 10% of such damages for Purchaser’s
related internal costs relating to the default. For purposes of this provision, specific performance shall be considered not available
to Purchaser if the court declines to grant the remedy or if the nature of Seller’s default is such that upon obtaining specific
performance, Purchaser would be denied, in any material respect, the benefit Purchaser bargained for in this Agreement. Notwithstanding
the above provisions of this Section, Purchaser retains all rights and remedies available in law and equity to enforce provisions
which survive termination of this Agreement.

 

8.2           Purchaser’s
Default. If this transaction fails to close due to the default of Purchaser, then Seller’s sole remedy in such event
shall be to terminate this Agreement and to retain the Earnest Money as liquidated damages, Seller waiving all other rights or
remedies in the event of such default by Purchaser. Purchaser and Seller have considered carefully the loss to Seller occasioned
by taking the Property off the market as a consequence of the negotiation and execution of this Agreement, the expenses of Seller
incurred in connection with the preparation of this Agreement and Seller’s performance under this Agreement, and the other
damages, general and special, which Purchaser and Seller realize and recognize Seller will sustain but which Purchaser and Seller
agree would be impracticable or extremely difficult to calculate at this time if Purchaser so defaults. Based on all those considerations,
Purchaser and Seller agree that the Earnest Money, together with the interest on it, represents a reasonable estimate of Seller’s
damages. Seller agrees to accept the Earnest Money as Seller’s total damages and relief under this Agreement if Purchaser
defaults in its obligations to close under this Agreement, Seller waiving all other rights and remedies.

 

8.3           Notice
of Default. Except for a party’s failure to close on the Closing Date, neither party shall have the right to declare
a default by the other party and terminate this Agreement because of a failure by such other party to perform under the terms of
this Agreement unless the other party shall fail to cure such failure to perform within five Business Days after its receipt of
written notice of such failure to perform.

 

8.4           Other
Expenses. If this Agreement is terminated due to the default of a party, then the defaulting party shall pay any fees due to
the Escrow Agent for holding the Earnest Money and any fees due to the Title Company for cancellation of the Title Commitment.

 

ARTICLE 9. EARNEST
MONEY PROVISIONS

 

9.1           Investment
and Use of Funds. The Escrow Agent shall invest the Earnest Money in a government insured interest bearing account satisfactory
to Purchaser at an institution having assets of not less than $125,000,000, shall not commingle the Earnest Money with any funds
of the Escrow Agent or others, and shall promptly provide Purchaser and Seller with confirmation of the investments made. If the
Closing under this Agreement occurs, the Escrow Agent shall deliver the Earnest Money to, or upon the instructions of, Purchaser
on the Closing Date. Provided such supplemental escrow instructions are not in conflict with this Agreement as it may be amended
in writing from time to time, Seller and Purchaser agree to execute such supplemental escrow instructions as may be appropriate
to enable Escrow Agent to comply with the terms of this Agreement.

 

    	 	14	 

     

    

 

9.2           Termination
Pursuant to Section 2.2 or 2.3. The Purchaser shall notify the Escrow Agent of the date that the Due Diligence Period
ends promptly after such date is established under this Agreement, and Escrow Agent may rely upon such notice. If Purchaser elects
to terminate this Agreement pursuant to Section 2.2 (or is deemed to have terminated this Agreement), or if Purchaser notifies
Escrow Agent that this Agreement has terminated pursuant to Section 2.3, Escrow Agent shall pay the entire Earnest Money to
Purchaser one Business Day following receipt of the Due Diligence Termination Notice (or if no Due Diligence Approval Notice is
delivered prior to the expiration of the Due Diligence Period, one Business Day following the last day of the Due Diligence Period)
or notice of termination under Section 2.3, as applicable, from Purchaser (as long as the current investment can be liquidated
in one day) and this Agreement shall then terminate. No notice to Escrow Agent from Seller shall be required for the release of
the Earnest Money to Purchaser by Escrow Agent. The Earnest Money shall be released and delivered to Purchaser from Escrow Agent
upon Escrow Agent’s receipt of the Due Diligence Termination Notice (or if no Due Diligence Approval Notice is delivered
prior to the expiration of the Due Diligence Period, one Business Day following the last day of the Due Diligence Period) or Development
Approvals Termination notice, as applicable, despite any objection or potential objection by Seller. Seller agrees it shall have
no right to bring any action against Escrow Agent which would have the effect of delaying, preventing, or in any way interrupting
Escrow Agent’s delivery of the Earnest Money to Purchaser pursuant to this Section 9.2, any remedy of Seller being against
Purchaser, not Escrow Agent.

 

9.3           Other
Terminations. Upon a termination of this Agreement other than as described in Section 9.2, either party to this Agreement
(the “Terminating Party”) may give written notice to the Escrow Agent and the other party (the “Non-Terminating
Party”) of such termination and the reason for such termination. Such request shall also constitute a request for the
release of the Earnest Money to the Terminating Party. The Non-Terminating Party shall then have five Business Days in which to
object in writing to the release of the Earnest Money to the Terminating Party. If the Non-Terminating Party provides such an objection,
then the Escrow Agent shall retain the Earnest Money until it receives written instructions executed by both Seller and Purchaser
as to the disposition and disbursement of the Earnest Money, or until ordered by final court order, decree or judgment, which is
not subject to appeal, to deliver the Earnest Money to a particular party, in which event the Earnest Money shall be delivered
in accordance with such notice, instruction, order, decree or judgment.

 

9.4           Interpleader.
Except as provided in Section 9.2 above, Seller and Purchaser mutually agree that in the event of any controversy regarding
the Earnest Money, unless mutual written instructions are received by the Escrow Agent directing the Earnest Money’s disposition,
the Escrow Agent shall not take any action, but instead shall await the disposition of any proceeding relating to the Earnest Money
or, at the Escrow Agent’s option, the Escrow Agent may interplead all parties and deposit the Earnest Money with a court
of competent jurisdiction in which event the Escrow Agent may recover all of its court costs and reasonable attorneys’ fees.
Seller or Purchaser, whichever does not prevail in any such interpleader action, shall be solely obligated to pay such costs and
fees of the Escrow Agent, as well as the reasonable attorneys’ fees of the prevailing party in accordance with the other
provisions of this Agreement.

 

9.5           Liability
of Escrow Agent. The parties acknowledge that the Escrow Agent is acting solely as a stakeholder at their request and for their
convenience, that the Escrow Agent shall not be deemed to be the agent of either of the parties, and that the Escrow Agent shall
not be liable to either of the parties for any action or omission on its part taken or made in good faith, and not in disregard
of this Agreement, but shall be liable for its negligent acts and for any loss, cost or expense incurred by Seller or Purchaser
resulting from the Escrow Agent’s mistake of law respecting the Escrow Agent’s scope or nature of its duties. Seller
and Purchaser shall jointly and severally indemnify and hold the Escrow Agent harmless from and against all costs, claims and expenses,
including reasonable attorneys’ fees, incurred in connection with the performance of the Escrow Agent’s duties under
this Agreement, except with respect to actions or omissions taken or made by the Escrow Agent in bad faith, in disregard of this
Agreement or involving negligence on the part of the Escrow Agent.

 

9.6           Escrow
Fee. Except as expressly provided in this Agreement to the contrary, the escrow fee, if any, charged by the Escrow Agent for
holding the Earnest Money or conducting the Closing shall be shared equally by Seller and Purchaser.

 

ARTICLE 10. MISCELLANEOUS

 

10.1         Parties
Bound. Neither party may assign this Agreement without the prior written consent of the other, and any such prohibited assignment
shall be void; provided that Purchaser may assign this Agreement without Seller’s consent to (i) the New LLC, or (ii) an
Affiliate (defined below) who will become a member of the New LLC upon Closing, or (iii) in order to effect an Exchange pursuant
to Section 10.18. Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the respective
legal representatives, successors, assigns, heirs, and devisees of the parties. For the purposes of this Section 10.1, (a) “Affiliate”
means (i) an entity that directly or indirectly controls, is controlled by or is under common control with the Purchaser or
(ii) an entity in which any of Purchaser or Neil T. Brown holds and economic interest; and (b) “control”
means the power to direct the management of such entity through voting rights, ownership or contractual obligations.

 

    	 	15	 

     

    

 

10.2         Headings.
The Article and Section headings of this Agreement are for convenience only and in no way limit or enlarge the scope or meaning
of the language of this Agreement.

 

10.3         Invalidity
and Waiver. If any portion of this Agreement is held to be invalid or inoperative, then so far as is reasonable and possible
the remainder of this Agreement shall be deemed valid and operative, and, to the greatest extent legally possible, effect shall
be given to the intent manifested by the portion held invalid or inoperative. The failure by either party to enforce against the
other party any term or provision of this Agreement shall not be deemed to be a waiver of such party’s right to enforce against
the other party the same or any other such term or provision in the future.

 

10.4         Governing
Law. This Agreement shall, in all respects, be governed, construed, applied, and enforced in accordance with the laws of the
state in which the Property is located.

 

10.5         Survival.
The provisions of this Agreement that contemplate performance after the Closing and the obligations of the parties not fully performed
at the Closing shall survive the Closing and shall not be deemed to be merged into or waived by the instruments of Closing.

 

10.6         No
Third Party Beneficiary. This Agreement is not intended to give or confer any benefits, rights, privileges, claims, actions
or remedies to any person or entity as a third party beneficiary, decree, or otherwise.

 

10.7         Entirety
and Amendments. This Agreement embodies the entire agreement between the parties and supersedes all prior agreements and understandings
relating to the Property. This Agreement may be amended or supplemented only by an instrument in writing executed by the party
against whom enforcement is sought.

 

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

 

10.9         Confidentiality.

 

(a)          NDA.
For purposes of this Section 10.9: (i) “NDA” means the Mutual Confidentiality and Nonpursuit Agreement
dated as of March 2, 2015, by and between Seller and Purchaser; (ii) “Confidential Information” has
the meaning set forth for that term in the NDA, as modified by the effect of clauses (iii), (iv) and (v) of this sentence; (iii) the
Property Information shall not be Confidential Information and shall be governed by Section 2.1 of this Agreement; (iv) the
definition of the term “Discloser”, as used in the NDA in connection with the definition of the term Confidential
Information, is modified to mean, as between Seller and Purchaser, the disclosing party with respect to any Confidential Information
(as that term is modified by the effect of this Section 10.9(a)) disclosed to the other party, and (v) the definition
of the term “Recipient” , as used in the NDA in connection with the definition of the term Confidential Information,
is modified to mean, as between Seller and Purchaser, the receiving party with respect to any Confidential Information (as that
term is modified by the effect of this Section 10.9(a)) disclosed by the Discloser. Except for the purposes set forth
in this Section 10.9, the NDA is terminated as of the Date of this Agreement.

 

(b)          For
purposes of this Section 10.9, “Restricted Information” means, collectively, (i) any Confidential
Information (as that term is used in the NDA and modified by Section 10.9(a)), and (ii) the terms of the transaction
contemplated by this Agreement (including without limitation, the Purchase Price and the other material economic terms of this
transaction). During the period commencing on the date of this Agreement and ending on March 1, 2018, Purchaser and Seller
shall maintain in strict confidence the Restricted Information and shall not disclose, whether through press releases or any other
means of publication (oral or written), the Restricted Information, except (A) to each party’s employees, agents, brokers,
attorneys, accountants, advisors and potential investors and lenders involved in the negotiation and consummation of this transaction
(collectively, the “Representatives”) and (B) governmental agencies but only to the extent necessary in
connection with obtaining the Development Approvals. In furtherance of the foregoing: each party (1) shall advise each of
its Representatives of the confidential nature of any Restricted Information disclosed to them and of its obligations under this
Section 10.9(b); (2)  shall be liable for any of its Representative’s breach of this Section 10.9(b); (3) acknowledges
that there may be no adequate remedy at law for a breach of this Section 10.9(b), and other party shall have the right to
seek injunctive relief for breach or prospective breach of this Section 10.9(b); and (4) shall defend, indemnify
and hold the other party harmless from and against any and all claims, damages, liabilities and expenses, including reasonable
attorneys’ fees, arising out of or resulting from a breach of this Section 10.9(b) by it or any of its Representatives.
Notwithstanding any terms or conditions in this Agreement or any related agreement to the contrary, but subject to restrictions
reasonably necessary to comply with federal or state securities laws, any person may disclose to any and all persons, without limitation
of any kind, the tax treatment and tax structure of the transaction and all materials of any kind (including opinions or other
tax analyses) that are provided relating to such tax treatment and tax structure. Each party is also permitted to disclose any
information otherwise deemed confidential under this Section 10.9(b) in connection with the performance of its obligations
under this Agreement and any litigation relating to the Property or this transaction. The provisions of this Section 10.9(b)
shall survive the Closing and any termination of this Agreement.

 

    	 	16	 

     

    

 

10.10         No
Recording. Purchaser shall not record this Agreement or any memorandum of this Agreement.

 

10.11         Attorneys’
Fees. If either party employs attorneys to enforce any of the provisions of this Agreement, the party against whom any final
judgment is entered agrees to pay the prevailing party up to $100,000 of the prevailing party’s reasonable costs, charges
and expenses, including attorneys’ fees, expended or incurred by the prevailing party in connection with the enforcement
action. The provisions of this Section 10.11 shall survive the Closing and any termination of this Agreement.

 

10.12         Notices.
All notices required or permitted under this Agreement shall be in writing and shall be delivered to the parties at the addresses
set forth in Section 1.1. Any such notices shall be sent by (a) overnight delivery using a nationally recognized overnight
courier, in which case notice shall be deemed delivered one Business Day after deposit with such courier, (b) personal delivery,
in which case notice shall be deemed delivered upon receipt; or (c)  electronic mail in a “PDF” format followed
by one of the delivery methods described in clauses (a) or (b) above, in which case notice shall be deemed delivered upon
transmission of such notice by electronic mail. A party’s address may be changed by written notice to the other party; provided,
however, that no notice of a change of address shall be effective until actual receipt of such notice. Copies of notices are for
informational purposes only, and a failure to give or receive copies of any notice shall not be deemed a failure to give notice.
Notices given by counsel to the Purchaser shall be deemed given by Purchaser and notices given by counsel to the Seller shall be
deemed given by Seller.

 

10.13         Construction.
The parties acknowledge that the parties and their counsel have reviewed and revised this Agreement and agree that the normal rule
of construction – to the effect that any ambiguities are to be resolved against the drafting party – shall not be employed
in the interpretation of this Agreement or any exhibits or amendments to this Agreement.

 

10.14         Calculation
of Time Periods. Unless otherwise specified, in computing any period of time described in this Agreement, the day of the act
or event after which the designated period of time begins to run is not to be included and the last day of the period so computed
is to be included, unless the last day is not a Business Day, in which event the period shall run until the end of the next day
which is a Business Day. The last day of any period of time described in this Agreement shall be deemed to end at 6:00 p.m. Atlanta,
Georgia time.

 

10.15         Procedure
for Indemnity. The following provisions govern actions for indemnity under this Agreement. Promptly after receipt by an indemnitee
of notice of any claim for which the indemnitee is entitled to indemnification under this Agreement, the indemnitee shall deliver
to the indemnitor written notice of the claim. The indemnitor shall have the right to participate in, and, if the indemnitor agrees
in writing that it will be responsible for any costs, expenses, judgments, damages and losses incurred by the indemnitee with respect
to such claim, to assume the defense of such claim with counsel mutually satisfactory to the indemnitor and the indemnitee. Notwithstanding
the preceding sentence, the indemnitee shall have the right to retain its own counsel, with the fees and expenses to be paid by
the indemnitor, if the indemnitee reasonably believes that representation of the indemnitee by the counsel retained by the indemnitor
would be inappropriate due to actual or potential differing interests between the indemnitee and any other party represented by
such counsel in any proceeding relating to the claim. The failure of the indemnitee to deliver written notice to the indemnitor
within a reasonable time after the indemnitee receives notice of any such claim shall not relieve the indemnitor of any liability
to the indemnitee under the indemnity, unless and only if and to the extent that the failure is prejudicial to the indemnitor’s
ability to defend the claim. The indemnitee’s failure to so deliver written notice to the indemnitor will not relieve the
indemnitor of any liability that it may have to any indemnitee other than the indemnitor’ s indemnification obligation under
this Agreement. If an indemnitee settles a claim without the prior written consent of the indemnitor, the indemnitor shall be released
from liability with respect to the claim unless the indemnitor has unreasonably withheld its consent to the settlement. The provisions
of this Section 10.15 shall survive the Closing and any termination of this Agreement.

 

    	 	17	 

     

    

 

10.16         Further
Assurances. In addition to the acts and deeds recited in this Agreement and contemplated to be performed, executed and/or delivered
by the parties at Closing, each party agrees to perform, execute and deliver, but without any obligation to incur any additional
liability or expense, on or after the Closing any further deliveries and assurances as may be reasonably necessary to consummate
the transactions contemplated under this Agreement or to further perfect the conveyance, transfer and assignment of the Property
to Purchaser. The provisions of this Section 10.16 shall survive the Closing.

 

10.17         Execution
in Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original,
and all of such counterparts shall constitute one Agreement. To facilitate execution of this Agreement, the parties may execute
counterparts of the signature pages and exchange them in pdf format by electronic mail.

 

10.18         Section
1031 Exchange. Either party may consummate the purchase or sale (as applicable) of the Property as part of a so-called like
kind exchange (an “Exchange”) pursuant to § 1031 of the Internal Revenue Code of 1986, as amended
(the “Code”), provided that: (a)  the Closing shall not be delayed or affected by reason of the Exchange
nor shall the consummation or accomplishment of an Exchange be a condition precedent or condition subsequent to the exchanging
party’s obligations under this Agreement; (b) the exchanging party shall effect its Exchange through an assignment of
this Agreement, or its rights under this Agreement, to a qualified intermediary; (c) neither party shall be required to take
an assignment of the purchase agreement for relinquished or replacement property or be required to acquire or hold title to any
real property for purposes of consummating an Exchange desired by the other party; and (d) the exchanging party shall pay
any additional costs that would not otherwise have been incurred by the non-exchanging party had the exchanging party not consummated
the transaction through an Exchange. Neither party shall by this Agreement or acquiescence to an Exchange desired by the other
party have its rights under this Agreement affected or diminished in any manner or be responsible for compliance with or be deemed
to have warranted to the exchanging party that its Exchange in fact complies with § 1031 of the Code.

 

    	 	18	 

     

    

 

SIGNATURE PAGE TO AGREEMENT OF

PURCHASE AND SALE

BY AND BETWEEN

SOUTHERN APARTMENT GROUP-49, LLC

AND

ARCHCO RESIDENTIAL, LLC

 

IN WITNESS WHEREOF, the
parties to this Agreement have executed this Agreement on the day and year set forth below.

 

SELLER:

 

SOUTHERN APARTMENT GROUP-49, LLC

 

	By:	/s/ Shane Seagle	 	Date:	4/14/15
	Name:	Shane Seagle	 	 	 
	Title:	Member Manager	 	 	 

 

PURCHASER:

 

ARCHCO RESIDENTIAL, LLC

 

	By:	/s/ Neil T. Brown	 	Date:	4/14/15
	Name:	Neil T. Brown	 	 	 
	Title:	CEO	 	 	 

 

Escrow Agent has executed this Agreement
in order to confirm that the Escrow Agent has received and shall hold the Earnest Money and the interest earned on it, in escrow,
and shall disburse the Earnest Money, and the interest earned on it, pursuant to the provisions of Article 9.

 

ESCROW
AGENT:

 

	Fidelity National Title Insurance Co.	 	 	 
	 	 	 	 	 
	By:	/s/ Lindsey Mann	 	Date:	4/21/15
	Name:	Lindsey Mann	 	 	 
	Title:	Commercial Escrow Officer	 	 	 

 

    	 	19	 

     

    

 

AGREEMENT OF PURCHASE AND SALE

[1309 and 1331 West Morehead Street,
Charlotte NC;

811 and 829 South Summit Avenue, Charlotte,
NC]

 

EXHIBITS

 

	A -	Legal Description of the Land 
	 	 
	B -	Form of Bill of Sale
	 	 
	C – 	Form of Certificate of Non-Foreign Status
	 	 
	D – 	Letter of Intent for Joint Venture Participation

 

    	 	20	 

     

    

 

EXHIBIT
A

 

LEGAL DESCRIPTION OF THE LAND

 

BEGINNING AT A NAIL IN THE SIDEWALK AT THE
NORTHEAST MARGIN OF BRYANT STREET AND SOUTH SUMMIT AVENUE, SAID BEGINNING POINT BEING LOCATED S 78-46-00 E, 50.22’ FROM
A NAIL IN A SIDEWALK LOCATED AT THE NORTHWEST MARGIN OF BRYANT STREET AND SOUTH SUMMIT AVENUE; THENCE FROM SAID BEGINNING
POINT, WITH THE EASTERN MARGIN OF S SUMMIT AVE, N 11-45-00 E 390.00’ TO A NAIL IN THE SIDEWALK, SOUTHEAST MARGIN OF S
SUMMIT AVE AND WEST MOREHEAD STREET; THENCE WITH THE SOUTHERN MARGIN OF W MOREHEAD ST, ALONG A CURVE TO THE LEFT, WITH A
RADIUS OF 1263.11’, AN ARC OF 281.08’, AND BEARING & CHORD OF S 86-02-44 E, 280.50’ TO A 3/4”
PIPE; THENCE LEAVING SAID MARGIN OF W MOREHEAD ST, AND RUNNING WITH AN OLD ALLEYWAY S 03-10-25 E 195.06’ TO AN OLD
IRON; THENCE S 06-46-31 E 26.14’ TO A #4 REBAR, CORNER OF ABANDONED ALLEYWAY; THENCE WITH ABANDONED ALLEYWAY, ALONG A
CURVE TO THE LEFT, WITH A RADIUS OF 490.84, AN ARC OF 10.07’, AND BEARING AND CHORD OF S 70-09-42 W, 10.07’, TO A
#4 REBAR; THENCE S 12-57-00 E 186.09’ TO A #4 REBAR, LOCATED ON THE NORTHERN MARGIN OF BRYANT ST; THENCE WITH THE
NORTHERN MARGIN OF BRYANT ST, ALONG A CURVE TO THE RIGHT, WITH A RADIUS OF 1146.28’, AN ARC OF 10.09’, AND
BEARING AND CHORD OF S 84-50-51 W, 331.94’ TO A #4 REBAR; THENCE ALONG A CURVE TO THE RIGHT, WITH A RADIUS OF
1146.28’, AN ARC OF 333.11’, AND BEARING AND CHORD OF N 86-34-31 W, 331.94’ TO A NAIL; THENCE N 78-15-00 W,
84.69’ TO THE POINT AND PLACE OF BEGINNING, CONTAINING 3.158 ACRES, MORE OR LESS.

 

    	 	A-1	 

     

    

 

EXHIBIT B

 

FORM OF BILL OF SALE AND ASSIGNMENT

 

This
instrument is executed and delivered as of the ____ day of _________, 201__ pursuant to that certain Agreement of Purchase and
Sale (“Agreement”) dated ____________, 2015, by and between Southern Apartment Group-49, LLC (“Seller”),
and ____________________, a _________ limited liability company (“Purchaser”), covering the real property described
in Schedule 1 attached hereto (“Real Property”).

 

(a)          Sale
of Personality. For good and valuable consideration, Seller hereby sells, transfers, assigns, sets over and conveys to Purchaser
Seller’s right, title and interest in and to the following (collectively, the “Personality”):

 

(i)          Tangible
Personality. All equipment, machinery, furniture, furnishings, supplies and other tangible personal property owned by Seller,
if any, and Seller’s interest in any such property leased by Seller, now or hereafter located in and used exclusively in
connection with the operation, ownership or management of the Real Property; and

 

(ii)         Intangible
Personal Property. All intangible personal property used exclusively in connection with the Real Property and the Improvements
(as defined in the Agreement), if any, including, without limitation: all well permits, water and sewer taps, sanitary or storm
sewer capacity or reservations and rights under utility agreements with any applicable governmental or quasi-governmental entities
or agencies with respect to the providing of utility services to the Land; the plans and specifications and other architectural
and engineering drawings for the Improvements; warranties; contract rights related to the construction, operation, ownership or
management of the Real Property; the Development Approvals and all other governmental permits, approvals and licenses (to the extent
assignable); tenant lists and correspondence; (collectively, the “Intangible Personal Property”).

 

(b)          Warranty.
Seller hereby represents and warrants to Purchaser that it is the owner of the property described above, that such property, if
any, is free and clear of all liens, charges and encumbrances other than the Permitted Exceptions (as defined in the Agreement),
and Seller warrants and defends title to the above-described property unto Purchaser, its successors and assigns, against any person
or entity claiming, or to claim, the same or any part thereof by, through or under Seller, subject only to the Permitted Exceptions
as defined in the Agreement. Except as otherwise provided in this paragraph (b), the conveyance of the Personality is made
by Seller on an “AS-IS, WHERE IS WITH ALL FAULTS” basis.

 

IN WITNESS WHEREOF, the undersigned have
caused this Bill of Sale to be executed as of the date written above.

 

	SELLER:	 
	 	 
	SOUTHERN APARTMENT GROUP-49, LLC	 
	 	 	 
	By:	 	 
	Name:	 	 
	Title:	 	 

 

    	 	1	 

     

    

 

	PURCHASER:	 	 
	 	 	 	 
	 	 	 
	By:	 	 
	Name:	 	 
	Title:	 	 

 

    	 	2	 

     

    

 

SCHEDULE
1

 

LEGAL DESCRIPTION OF THE REAL PROPERTY

 

    	 	3	 

     

    

 

EXHIBIT C

 

FORM OF CERTIFICATE OF NON-FOREIGN STATUS

 

Section 1445 of the Internal Revenue Code of 1986, as amended
(“Code”), provides that a transferee (buyer) of a U.S. real property interest must withhold tax if the transferor (seller)
is a foreign person.

 

To inform ArchCo Residential, LLC, a Delaware limited liability
company (“Transferee”), that withholding of tax under section 1445 of the Code is not required upon disposition
of certain real property to the Transferee by Southern Apartment Group-49, LLC, a North Carolina limited liability company (“Transferor”),
the undersigned hereby warrants, represents and certifies the following on behalf of Transferor:

 

1.          The
undersigned is the duly and acting __________________ of Transferor.

 

2.          Transferor
is not a foreign corporation, foreign partnership, foreign trust, or foreign estate (as those terms are defined in the Internal
Revenue Code and Income Tax Regulations), but rather is an entity formed under the laws of one of the United States.

 

3.          Transferor
is not a disregarded entity as defined in section 1.1445-2(b)(2)(iii) of the Code;

 

4.          Transferor’s
U.S. employer identification number is ________________.

 

5.          Transferor’s
office address is _________________________________.

 

6.          Transferor
understands that this certification may be disclosed to the Internal Revenue Service by the transferee and that any false statement
contained in this certificate could be punished by fine, imprisonment, or both.

 

Under penalty of perjury the undersigned declares that the undersigned
has examined this certification and to the best of its knowledge and belief it is true, correct, and complete.

 

TRANSFEROR:

 

SOUTHERN APARTMENT GROUP-49, LLC

 

	By:	 	 	Date:	 
	Name:	 	 	 	 
	Title:	 	 	 	 

 

    	 	1	 

     

    

 

EXHIBIT D

 

LETTER OF INTENT FOR JOINT VENTURE PARTICIPATION

 

[See attachment]

 

    	 	1	 

     

    

 

SCHEDULE 3.3

 

OWNER AFFIDAVIT AND INDEMNITY AGREEMENT

 

(NO RECENT IMPROVEMENTS AND NO EXECUTORY
CONTRACTS FOR IMPROVEMENTS)

 

PARTIES:
All parties identified in this section must execute this Agreement.

 

OWNER:
(NOTE: A separate Agreement is required for each successive owner in the 120-Day Lien Period.)

 

PROPERTY:
See Exhibit A.

 

(Insert street address or brief description
and/or attach a description as Exhibit A. Include here any real estate that is a portion of a larger, previously unsegregated tract
when that area is reasonably necessary for the convenient use and occupation of Improvements on the larger tract.)

 

DEFINITIONS: The following capitalized
terms as used in this Agreement shall have the following meanings:

 

		·	Improvement: All or any part of any building, structure, erection, alteration, demolition, excavation, clearing, grading, filling,
or landscaping, including trees and shrubbery, driveways, and private roadways on the Property as defined below.

 

		·	Labor, Services or Materials: ALL labor, services, materials by or through Owner for which a lien can be claimed under NCGS
Chapter 44A, Article 2, including but not limited to professional design services (including architectural, engineering, landscaping
and surveying) and/or rental equipment.

 

		·	Contractor: Any person or entity who has performed or furnished or has contracted to perform or furnish Labor, Services or
Materials pursuant to a contract, either express or implied, with the Owner of real property for the making of an Improvement thereon.
(Note that services by architects, engineers, landscapers, surveyors, furnishers of rental equipment and contracts for construction
on Property of Improvements are often provided before there is visible evidence of construction.)

 

		·	120-Day Lien Period: The 120 days immediately preceding the date of recordation of the deed to purchaser in the Office of the
Register of Deeds of the county in which the Property is located.

 

		·	Owner: The party listed above.

 

		·	Company: The title insurance company providing the title policy for the transaction contemplated by the parties herein.

 

		·	Property: The real estate described above or on Exhibit A and any leaseholds, tenements, hereditaments, and improvements placed
thereon.

 

		·	All defined terms shall include the singular or plural as required by context.

 

AGREEMENT: For good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, and as an inducement to the issuance of a title insurance policy or
policies by Company insuring title to the Property without exception to liens for Labor, Services or Materials; Owner first being
duly sworn, deposes, says and agrees:

 

1.          Certifications:
Owner certifies that at no time during the 120-Day Lien Period have any Labor, Services or Materials been furnished in connection
with a contract, express or implied, by or through Owner for Improvements to the Property (including architectural, engineering,
landscaping or surveying services or materials or rental equipment for which a lien can be claimed under NCGS Chapter 44A) nor
have any Labor, Services or Materials been furnished on the Property prior to the 120-Day Lien Period at the request of Owner that
will or may be completed after the date of this affidavit OR only minor repairs and/or alterations to pre-existing Improvements
have been made and Owner certifies such repairs and/or alterations have been completed and those providing Labor, Services or Materials
for the repairs have been paid in full. The Owner further certifies that no Mechanics Lien Agent has been appointed. Owner further
certifies that, to the knowledge of Owner, there are no parties in possession of the Property other than those parties listed on
Exhibit B attached hereto and incorporated herein who have entered into lease agreements with Owner.

 

    	 	1	 

     

    

 

2.          Reliance
and Indemnification: This Agreement may be relied upon by Company in issuance of a title insurance policy or policies insuring
title to the Property without exception to matters certified in this Agreement. The provisions of this Agreement shall survive
the disbursement of funds and closing of this transaction and shall be binding upon Owner and anyone claiming by, through or under
Owner.

 

Owner agrees to indemnify
and hold Company harmless of and from any and all loss, cost, damage and expense of every kind, and attorney’s fees, costs
and expenses, which Company shall incur or become liable for, directly or indirectly, as a result of reliance on the certifications
of Owner made herein or in enforcement of the Company’s rights hereunder.

 

3.          NCLTA
Copyright and Entire Agreement: This Agreement and any attachments hereto represent the entire agreement between the Owner and
the Company, and no prior or contemporaneous agreement or understanding inconsistent herewith (whether oral or written) pertaining
to such matters is effective.

 

PROVIDING A FALSE AFFIDAVIT IS A
CRIMINAL OFFENSE

 

	(SEAL)	 
	 	 
	By:	 	 
	 	 
	 	 
	Printed or Typed Name/Title	 
	 	 
	By:	 	 
	 	 
	 	 
	Printed or Typed Name/Title	 

 

State of _________________ County of ________________,
Signed and sworn to (or affirmed) before me this day by _________________________ and _________________________ [insert name(s)
of principals].

 

	Date:	 	 
	 	 
	 	 
	Notary Public	 

 

My Commission Expires:______________________

 

(Affix Official/Notary Seal)

 

    	 	2	 

     

    

 

INSTRUCTIONS FOR COMPLETION OF

 

OWNER AFFIDAVIT AND INDEMNITY AGREEMENT

 

(NO RECENT IMPROVEMENTS AND NO EXECUTORY
CONTRACTS FOR IMPROVEMENTS)

 

1.          This
Owner Affidavit and Indemnity Agreement (the “Agreement”) form is for use with any title insurer (the “Company”)
regarding owner and lender coverage for transactions affecting title to particular real estate in North Carolina (the “Property”),
a description of which must be included in this Agreement, where there have been no Improvements made to the Property within the
120-Day Lien Period (as defined).

 

2.          The
closing attorney must notify underwriting counsel for the Company prior to closing regarding any filed Claim of Lien on Real Property
or Notice of Claim of Lien upon Funds, or any Notice of Claim of Lien upon Funds known by the attorney or Owner to have been delivered
to the Owner, whether on the Property or on any property in the state of North Carolina, as this may affect the Company’s
decisions about whether to insure and on what basis.

 

At the very least,
any filed Claim of Lien on Real Property must be paid in full and canceled of record. Any delivered or filed Notice of Claim of
Lien upon Funds (by a subcontractor) must be paid in full and a waiver obtained from the subcontractor. The attorney must discuss
any questions or issues regarding these with underwriting counsel for the Company prior to closing.

 

3.          This
form is appropriate for use in transactions wherein no recent Improvements have been made on the Property. If Labor, Services or
Materials (including surveying, architectural, engineering services or rental equipment) for Improvements to the Property have
been provided within the 120-Day Lien Period (as defined in the Agreement) (other than minor repairs to existing Improvements completed
by Owner without the assistance of a Contractor or supplier, or with evidence of payment at or before closing of completed work),
then either the

 

		·	NCLTA Form #2: OWNER/CONTRACTOR AFFIDAVIT, WAIVER OF LIENS AND INDEMNITY AGREEMENT (FOR CONSTRUCTION RECENTLY COMPLETED) or

 

		·	NCLTA Form #3: OWNER/CONTRACTOR AFFIDAVIT, INDEMNITY AND LIEN SUBORDINATION AGREEMENT (FOR CONSTRUCTION IN PROCESS OR IMMEDIATELY
CONTEMPLATED WITH CONSTRUCTION LOAN) should be used or

 

		·	NCLTA Form #5 (Owner) in conjunction with NCLTA Forms 6 and 7 (Potential Lien Claimants), as applicable, should be used.

 

Note, however, that in the situation in
which vacant unimproved Property is to be conveyed and the purchaser has already retained Contractors, the seller may execute this
form, and the purchaser would provide NCLTA Form #3 or NCLTA Form #5, as applicable as noted above, with regard to any potential
combined purchase and construction loan.

 

4.          NOTE:
There may be transactions where no Improvements have been made within the 120-Day Lien Period but work under an executory contract
with the Owner continues after closing. An “executory contract” is one under which certain obligations remain to be
performed in the future. Such post-closing Improvements may give rise to lien rights in the Property. An example is a lot purchase
transaction involving the developer in a subdivision where development or infrastructure work has temporarily stopped but could
or would be restarted after the date of this affidavit. In this scenario the NCLTA Form #2 or NCLTA Form #3 should be used.

 

5.          Any
variances in execution of this form or in parties signing must be approved by underwriting counsel for the Company prior to closing.

 

    	 	1	 

     

    

 

EXHIBIT A

 

Property Description

 

    	 	1	 

     

    

 

EXHIBIT B

 

Rent Roll

 

    	 	1	 

     

    

 

SCHEDULE 5.3

 

SPECIAL WARRANTY DEED

 

[3” top margin to be added]

 

Prepared by and when recorded Return to:

 

Moore & Van Allen PLLC (EBR)

100 N. Tryon Street, Suite 4700

Charlotte, North Carolina 28202

*No Title Examination Conducted by Preparer*

 

Tax Stamps: $

 

STATE OF NORTH CAROLINA

 

COUNTY OF MECKLENBURG

 

SPECIAL WARRANTY DEED

 

THIS SPECIAL WARRANTY
DEED is made this _____ day of __________, 20__ by and between ____________________, a North Carolina limited liability company,
having an address of____________________, Attn: ____________________, hereinafter called “Grantor”, and ____________________,
a having an address of hereinafter called “Grantee.” The words “Grantor” and “Grantee” include
the neuter, masculine and feminine genders, and the singular and the plural.

 

WITNESSETH:

 

FOR AND IN CONSIDERATION
of the sum of Ten Dollars ($10.00) in hand paid to Grantor by Grantee at and before the execution, sealing and delivery hereof,
and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Grantor has granted, bargained,
sold, aliened, conveyed and confirmed, and by these presents does grant, bargain, sell, alien, convey and confirm unto Grantee,
and the successors, legal representatives and assigns of Grantee all that tract or parcel of land lying and being in the County
of Mecklenburg, State of North Carolina, being more particularly described on Exhibit A, attached hereto and incorporated herein
by reference (the “Property”).

 

TOGETHER WITH the tenements,
hereditaments and appurtenances thereunto belonging or in anywise appertaining and together with any estate, right, title, interest
or claim of Grantor, either in law or equity, to the Property; and

 

GRANTOR SHALL WARRANT
and forever defend the right and title to the Property unto Grantee, and the successors, legal representatives and assigns of Grantee,
against the claims of all persons whomsoever, claiming by, through or under Grantor, but not otherwise; provided, however, that
the warranties of title made by Grantor herein shall not extend to any claims arising solely under any matter set forth on Exhibit
B attached hereto and incorporated herein.

 

No portion of the property
herein conveyed includes the primary residence of Grantor.

 

[SIGNATURE PAGE FOLLOWS]

    	 	1	 

     

    

 

IN
WITNESS WHEREOF, Grantor has executed and sealed this Special Warranty Deed, and delivered this Special Warranty Deed
to Grantee, on the day and year first written above.

 

	 	 	GRANTOR:
	 	 	 
	 	 	[Signature Block to be added]

 

	STATE OF NORTH CAROLINA	)	 
	 	)	 
	COUNTY OF MECKLENBURG	)	 

 

I certify that the
following person(s) personally appeared before me this day, each acknowledging to me that he or she signed the foregoing document:
_____________________________________________.

 

	 	 
	Notary Public	 
	 	 
	 	 
	(Print Name)	 

 

My Commission Expires:_______________________

 

OFFICIAL SEAL

 

    	 	2	 

     

    

 

EXHIBIT A

 

LEGAL DESCRIPTION

 

    	 	1	 

     

    

 

EXHIBIT A-1

 

TAX PARCEL INDENTIFIERS

 

The following are listed for county administration
only – they do not impact the conveyance property in the event of any discrepancy:

 

    	 	1	 

     

    

 

EXHIBIT B

 

EXCEPTIONS

 

[Permitted Exceptions]

 

    	 	1

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