Document:

ex1014.htm

     

    
      BLUEROCK
ENHANCED MULTIFAMILY TRUST, INC.

       

      CODE
OF ETHICS

    

     

    
      EXHIBIT 10.14

    

    
       

      
         

        
          

        

         

      

      
         

      

    

     

    

     

    TABLE
OF CONTENTS

    
      	 
      	 
      	 
      
	
              I.

            	
              Covered
      Persons/Purpose of the Code

            	
              1

            
	 
      	 
      	 
      
	
              II.

            	
              Conflicts
      of Interest

            	
              1

            
	 
      	 
      	 
      
	
              III.

            	
              Confidentiality

            	
              3

            
	 
      	 
      	 
      
	
              IV.

            	
              Recordkeeping

            	
              3

            
	 
      	 
      	 
      
	
              V.

            	
              Fair
      Dealing

            	
              3

            
	 
      	 
      	 
      
	
              VI.

            	
              Protection
      and Proper Use of Company Assets

            	
              4

            
	 
      	 
      	 
      
	
              VII.

            	
              Foreign
      Corrupt Practices Act

            	
              4

            
	 
      	 
      	 
      
	
              VIII.

            	
              Disclosure
      and Compliance

            	
              4

            
	 
      	 
      	 
      
	
              IX.

            	
              Accountability

            	
              5

            
	 
      	 
      	 
      
	
              X.

            	
              Accounting
      Complaints

            	
              5

            
	 
      	 
      	 
      
	
              XI

            	
              Reporting
      any Illegal or Unethical Behavior

            	
              5

            
	 
      	 
      	 
      
	
              XII.

            	
              Administration
      and Violations of the Code of Ethics

            	
              5

            
	 
      	 
      	 
      
	
              XIII.

            	
              Other
      Policies and Procedures

            	
              6

            
	 
      	 
      	 
      
	
              XIV.

            	
              Confidentiality
      of Reports & Records

            	
              6

            
	 
      	 
      	 
      
	
              XV.

            	
              Internal
      Use

            	
              6

            

    

     

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    BLUEROCK
ENHANCED MULTIFAMILY TRUST, INC.

     

    CODE
OF ETHICS

     

    Adopted
January 14, 2009

    
      	 
      	 
      
	
              I.

            	
              Covered Persons/Purpose of the
      Code

            

    

     

              This
Code of Ethics (the “Code”-) for
Bluerock Enhanced Multifamily Trust, Inc. (the “Company”) applies to
its principal executive officer, principal financial officer, principal
accounting officer, controller and persons performing similar functions and all
members of its Board of Directors (the “Board”) (collectively
the “Covered
Persons”) for the purpose of promoting:

    
      	 
      	 
      	 
      
	 
      	
              •

            	
              honest
      and ethical conduct, including the ethical handling of actual or apparent
      conflicts of interest between personal and professional
      relationships;

            
	 
      	 
      	 
      
	 
      	
              •

            	
              full,
      fair, accurate, timely and understandable disclosure in reports and
      documents filed with, or submitted to, the Securities and Exchange
      Commission (the “SEC”) and in other
      public communications made by the Company;

            
	 
      	 
      	 
      
	 
      	
              •

            	
              compliance
      with applicable laws and governmental rules and
    regulations;

            
	 
      	 
      	 
      
	 
      	
              •

            	
              prompt
      internal reporting of violations of the Code to an appropriate person or
      persons identified in the Code; and

            
	 
      	 
      	 
      
	 
      	
              •

            	
              accountability
      for adherence to the Code.

            

    

     

    

    
      	 
      	 
      
	
              II.

            	
              Conflicts of
      Interest

            

    

     

              Covered
Persons should be scrupulous in avoiding conflicts of interest with regard to
the interests of the Company. A “conflict of interest” occurs when a Covered
Person’s private interest in any material respect interferes with the interests
of, or his or her service to, the Company. For example, a conflict of interest
would arise if a Covered Person, or a member of such Covered Person’s family,
receives improper personal benefits as a result of his or her position with the
Company.

     

              Although
typically not presenting an opportunity for improper personal benefit, conflicts
arise from, or as a result of, the contractual relationships between the Company
and (i) its advisor, Bluerock Enhanced Multifamily Advisor, LLC (the “Advisor”), (ii) its
dealer manager, Select Capital Corporation, LLC (the “Dealer Manager”),
(iii) its sponsors, Bluerock Real Estate, L.L.C. and Orion Residential, LLC (the
“Sponsors”),
(iv) its property manager, Bluerock REIT Property Management, LLC (the “Property Manager”),
and (v) any of its other affiliates (collectively, “Company Affiliates”).
As a result, this Code recognizes that the Covered Persons will, in the normal
course of their duties (whether formally for the Company or for Company
Affiliates or both), be involved in establishing policies and implementing
decisions that may have different effects on Company Affiliates and the Company.
The participation of the Covered Persons in such activities is inherent in the
contractual relationship between the

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    Company
and Company Affiliates and is consistent with the performance by the Covered
Persons of their duties as officers and directors of the Company.

     

              The
following list provides examples of prohibited conflicts of interest under this
Code, but Covered Persons should keep in mind that these examples are not
exhaustive. The overarching principle is that the personal interest of a Covered
Person should not be placed improperly before the interest of the
Company.

     

              Each
Covered Person must:

    
      	 
      	 
      	 
      
	 
      	
              •

            	
              not
      use his or her personal influence or personal relationships improperly to
      influence business decisions or financial reporting by the Company whereby
      the Covered Person would benefit personally to the detriment of the
      Company;

            
	 
      	 
      	 
      
	 
      	
              •

            	
              not
      cause the Company to take action, or fail to take action, for the
      individual personal benefit of the Covered Person to the detriment of the
      Company; and

            
	 
      	 
      	 
      
	 
      	
              •

            	
              report
      at least annually any affiliations or other relationships related to
      conflicts of interest.

            

    

     

              In
addition to the prohibitions in the Code, federal securities laws prohibit
personal loans to directors and executive officers by the Company.

     

              In
order to avoid situations in which a conflict of interest involving a Covered
Person may result in an improper benefit, all transactions involving a conflict
of interest must be approved by a majority of the Board (including a majority of
the independent directors) not otherwise interested in the transaction as fair
and reasonable to the Company and on terms not less favorable to the Company
than those available from unaffiliated third parties. Conflicts of interest may
not always be clear-cut, so if an officer or director has a question, he or she
shall promptly bring it to the attention of the Chairman of the Audit Committee
of the Board of the Company (the “Audit Committee”).
Examples of potential conflicts of interest include:

    
      	 
      	 
      	 
      
	 
      	
              •

            	
              service
      as a director on the board of any other business
    organization;

            
	 
      	 
      	 
      
	 
      	
              •

            	
              the
      receipt of non-nominal gifts;

            
	 
      	 
      	 
      
	 
      	
              •

            	
              the
      receipt of entertainment from any company with which the Company has
      current or prospective business dealings, including investments in such
      companies, unless such entertainment is business-related, reasonable in
      cost, appropriate as to time and place, and not so frequent as to raise
      any questions of impropriety; or

            
	 
      	 
      	 
      
	 
      	
              •

            	
              any
      ownership interest in, or any consulting or employment relationship with,
      any of the Company’s unaffiliated service
  providers.

            

    

     

              The
Company encourages civic, charitable, educational and political activities as
long as they do not interfere with the performance of the duties of an officer
or director of the Company. Each officer or director shall contact the Audit
Committee before agreeing to participate in any civic or political activity that
is likely to unduly interfere with the performance of his or her duties as an
officer or director of the Company.

     

    2

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

    
      	 
      	 
      
	
              III.

            	
              Confidentiality

            

    

     

              Covered
Persons shall maintain the confidentiality of confidential information entrusted
to them by the Company or parties with whom the Company transacts business,
except when disclosure is authorized by the Chairman of the Audit Committee or
required by laws, regulations or legal proceedings. Whenever feasible, Covered
Persons should consult with the Chairman of the Audit Committee if they believe
they have a legal obligation to disclose confidential information. Confidential
information includes all non-public information, and all other information the
disclosure of which might be harmful to the Company or parties with whom the
Company transacts business, including, without limitation, information that
could (i) be of use to competitors of the Company, (ii) have an adverse effect
on the Company’s business relationships or otherwise adversely affect the
reputation or perception of the Company in the business, financial, investment
or real estate community, (iii) impair the value of any of the Company’s assets
or (iv) expose the Company to legal claims, regulatory actions or other forms of
liability. Covered Persons shall not share confidential information with anyone
outside of the Company, including family and friends, or with employees,
officers and directors of the Advisor and its affiliates who do not need to know
the information to carry out their duties. Covered Persons remain under an
obligation to keep all information confidential even if their relationship with
the Company ends. All public and media communications involving the Company
shall be handled exclusively by the President of the Company.

    
      	 
      	 
      
	
              IV.

            	
              Recordkeeping

            

    

     

              All
of the Company’s books, records, accounts and financial statements must be
maintained in reasonable detail, must appropriately reflect the Company’s
transactions and must conform both to applicable legal requirements and to the
Company’s system of internal controls. Unrecorded or “off the books” funds or
assets should not be maintained unless permitted by applicable law or regulation
and authorized by the Audit Committee. Records should always be retained or
destroyed according to the Company’s record retention policies.

    
      	 
      	 
      
	
              V.

            	
              Fair
    Dealing

            

    

     

              Each
Covered Person shall deal fairly with the Company’s customers, suppliers,
competitors, officers and employees. No Covered Person should take unfair
advantage of anyone through manipulation, concealment, abuse of privileged
information, misrepresentation of material facts or any other unfair dealing or
practice. The Company seeks competitive advantages through superior performance,
never through unethical or illegal business practices. Stealing proprietary
information, possessing trade secret information that was obtained without the
owner’s consent, or inducing such disclosures by past or present employees of
other companies is prohibited. Covered Persons must disclose prior to or at
their time of hire the existence of any employment agreement, non-compete or
non-solicitation agreement, confidentiality agreement or similar agreement with
a former employer that in any way restricts or prohibits the performance of any
duties or responsibilities of their positions with the Company. Copies of such
agreements should be provided to the President of the Company to permit
evaluation of the agreement in light of the officer’s position. In no event
shall a Covered Person use any trade secrets, proprietary information or other
similar property, acquired in the course of his or her employment with another
employer, in the performance of his or her duties for or on behalf of the
Company.

     

    3

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

    
      	 
      	 
      
	
              VI.

            	
              Protection and Proper Use of
      Company Assets

            

    

     

              All
Covered Persons shall protect the Company’s assets and ensure their efficient
and proper use. Theft, carelessness and waste have a direct impact on the
Company’s profitability. All Company assets should be used for legitimate
business purposes. Company assets may not be used for personal benefit, sold,
loaned, given away or disposed of without proper authorization. Permitting
Company property to be damaged, lost or used in an unauthorized manner is
strictly prohibited. Covered Persons shall not use corporate or other official
stationary for personal purposes.

    
      	 
      	 
      
	
              VII.

            	
              Foreign Corrupt Practices
      Act

            

    

     

              The
United States Foreign Corrupt Practices Act prohibits giving anything of value,
directly or indirectly, to foreign government officials or foreign political
candidates in order to obtain, retain or direct business. Accordingly, corporate
funds, property or anything of value may not be, directly or indirectly, offered
or given by a Covered Person or an agent acting on such Covered Person’s behalf,
to a foreign official, foreign political party or official thereof or any
candidate for a foreign political office for the purpose of influencing any act
or decision of such foreign person or inducing such person to use his or her
influence or in order to assist in obtaining or retaining business for, or
directing business to, any person.

     

              Covered
Persons are also prohibited from offering or paying anything of value to any
foreign person if it is known or it should have been known that all or part of
such payment will be used for the above-described prohibited actions. This
provision includes situations when intermediaries, such as affiliates or agents,
are used to channel payoffs to foreign officials.

    
      	 
      	 
      
	
              VIII.

            	
              Disclosure and
      Compliance

            

    

     

              Each
Covered Person should:

    
      	 
      	 
      	 
      
	 
      	
              •

            	
              familiarize
      himself or herself with the disclosure requirements generally applicable
      to the Company;

            
	 
      	 
      	 
      
	 
      	
              •

            	
              not
      knowingly misrepresent, or cause others to misrepresent, facts about the
      Company to others, whether within or outside the Company, including to the
      Company’s directors and auditors, and to governmental regulators and
      self-regulatory organizations;

            
	 
      	 
      	 
      
	 
      	
              •

            	
              to
      the extent appropriate within such Covered Person’s area of
      responsibility, consult with other officers and employees of the Company
      and Company Affiliates with the goal of promoting full, fair, accurate,
      timely and understandable disclosure in the reports and documents the
      Company files with, or submits to, the SEC and in other public
      communications made by the Company; and

            
	 
      	 
      	 
      
	 
      	
              •

            	
              promote
      compliance with the standards and restrictions imposed by applicable laws,
      rules and regulations.

            

    

     

    4

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

    
      	 
      	 
      
	
              IX.

            	
              Accountability

            

    

     

    Each
Covered Person must:

    
      	 
      	 
      	 
      
	 
      	
              •

            	
              upon
      adoption of the Code (or thereafter as applicable, upon becoming a Covered
      Person), affirm in writing to the Board that he has received, read and
      understands the Code by signing and returning to the Board the affirmation
      attached hereto as Exhibit
      A;

            
	 
      	 
      	 
      
	 
      	
              •

            	
              annually
      thereafter affirm to the Board that he has complied with the requirements
      of the Code;

            
	 
      	 
      	 
      
	 
      	
              •

            	
              not
      retaliate against any other Covered Person or any employee of the Company
      or Company Affiliates for reports of potential violations that are made in
      good faith; and

            
	 
      	 
      	 
      
	 
      	
              •

            	
              notify
      the Chairman of the Audit Committee promptly if he or she knows of any
      material violation of this Code.

            

    

    

    
      	 
      	 
      
	
              X.

            	
              Accounting
      Complaints

            

    

     

              The
Company’s policy is to comply with all financial reporting and accounting
regulations applicable to the Company. If any Covered Person of the Company has
concerns or complaints regarding questionable accounting or auditing matters
(including, but not limited to, knowingly providing any false or misleading
representation to an auditor) which in any way affects the Company, then such
Covered Person is encouraged to submit those concerns or complaints
(anonymously, confidentially or otherwise) to the Chairman of the Audit
Committee.

    
      	 
      	 
      
	
              XI.

            	
              Reporting any Illegal or
      Unethical Behavior

            

    

     

              Covered
Persons are encouraged to talk to other officers about observed illegal or
unethical behavior and about the best course of action in a particular
situation. Officers and directors who are concerned that violations of this Code
have occurred or may occur or that other illegal or unethical conduct by other
officers or directors of the Company has occurred or may occur should contact
(anonymously, confidentially or otherwise) the Compliance Officer of the Code or
the Chairman of the Audit Committee.

    
      	 
      	 
      
	
              XII.

            	
              Administration and Violations
      of the Code of Ethics

            

    

     

              This
Code shall be administered and monitored by the Code’s Compliance Officer who
shall be appointed by the Audit Committee. The Compliance Officer will handle
the Company’s day-to-day compliance matters, including:

    
      	 
      	 
      	 
      
	 
      	
              •

            	
              receiving,
      reviewing, investigating and resolving concerns and reports on the matters
      described in this Code;

            
	 
      	 
      	 
      
	 
      	
              •

            	
              providing
      guidance on the meaning and application of this Code;
  and

            
	 
      	 
      	 
      
	 
      	
              •

            	
              reporting
      periodically and as matters arise (if deemed necessary by the Compliance
      Officer) to management and the Audit Committee on
      implementation

            

    

     

    5

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

     

    and
effectiveness of this Code and other compliance matters and recommending any
updates or amendments to the Code that he or she deems necessary.

     

              Any
questions and further information on this Code should be directed to the
Compliance Officer.

     

              Covered
Persons are expected to follow this Code at all times. Generally, there should
be no waivers of this Code. For executive officers and directors, the Audit
Committee shall have the sole and absolute discretionary authority to approve
any deviation or waiver from or amendments to this Code and any such waiver must
be promptly disclosed to shareholders.

    
      	 
      	 
      
	
              XIII.

            	
              Other Policies and
      Procedures

            

    

     

              This
Code shall be the sole code of ethics adopted by the Company for purposes of
Section 406 of the Sarbanes-Oxley Act of 2002 and the applicable rules and
regulations thereunder. Insofar as other policies or procedures of the Company
or Company Affiliates govern or purport to govern the behavior or activities of
the Covered Persons who are subject to this Code, they are superseded by this
Code to the extent that they overlap or conflict with the provisions of this
Code.

    
      	 
      	 
      
	
              XIV.

            	
              Confidentiality of Reports
      & Records

            

    

     

              All
reports and records prepared or maintained pursuant to this Code will be
considered confidential and shall be maintained and protected accordingly.
Except as otherwise required by law or regulation or this Code, such matters
shall not be disclosed to anyone other than the Board and the Audit
Committee.

    
      	 
      	 
      
	
              XV.

            	
              Internal
    Use

            

    

     

              The
Code is intended solely for the internal use by the Company and does not
constitute an admission, by or on behalf of the Company, as to any fact,
circumstance or legal conclusion.

     

    6

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

     

    EXHIBIT
A

     

    AFFIRMATION
OF RECEIPT OF CODE OF ETHICS

     

              I,
_______________________, as a “Covered Person” under the terms of the Code of
Ethics (the “Code”) of Bluerock
Enhanced Multifamily Trust, Inc. (the “Company”), hereby
affirm to the Company’s Board of Directors that I have received a copy of the
Code and that I have read and understand the Code.

    
      	 
      	 
      	 
      
	________________________________________________
      	 
      	____________________________________________________
	
              Date

            	 
      	
              Name:
      ____________________________________________________

            
	 
      	 
      	
              Title:
      ____________________________________________________ex1015.htm

    
      BLUEROCK
ENHANCED MULTIFAMILY TRUST, INC.

       

      WHISTLEBLOWER
POLICY

       

      EXHIBIT
10.15

       

      Adopted
as of January 14, 2009

       

      Biuerock
Enhanced Multifamily Trust, Inc., a Maryland corporation (the “Company’’), has
adopted this policy to encourage employees of the Company, the advisor to the
Company, and any other entity affiliated with the Company that enters into
contractual relationships with the Company (collectively, “Biuerock Affiliates”)
to report to responsible persons possible (i) violations of law, including the
applicable securities laws, (ii) accounting irregularities, and (iii) other
suspected wrongdoing, including their own, which in any way may affect the
Company or the properties owned by the Company. The goal of this policy is to
discourage illegal activity and business conduct that damages the Company's good
name, business interests and its relationships with employees, stockholders,
broker-dealers, real estate professionals, suppliers, tenants and the community
at large. While the Company does not encourage frivolous complaints, it does
want any officer, employee or agent of any Biuerock Affiliates (each an “Affected Person”) who
knows of a Harmful Violation (defined below) or potentially what is reasonably
believed to be a Harmful Violation to contact a representative of a Biuerock
Affiliate or the Company through one of the methods contained in Section 7. A
“Harmful
Violation” includes the following:

      
        	 
      	 
      	 
      
	 
      	
                1.

              	
                violations
      of law which in any way may affect the Company or the properties owned by
      the Company, including any rule of the Securities and Exchange Commission,
      federal laws related to fraud against the stockholders of the Company, and
      the laws and regulations of any jurisdiction in which the Company
      operates;

              
	 
      	 
      	 
      
	 
      	
                2.

              	
                violations
      of the Bluerock Affiliates' policies and statutory or other requirements
      for good corporate governance involving the Company;

              
	 
      	 
      	 
      
	 
      	
                3.

              	
                improper
      accounting entries, violations of internal accounting controls or improper
      auditing matters (including, but not limited to, knowingly providing any
      false or misleading representation to an auditor) which in any way may
      affect the Company or the properties owned by the
  Company;

              
	 
      	 
      	 
      
	 
      	
                4.

              	
                any
      other matter which, in the good faith belief of any Affected Person, could
      cause harm to the business or public reputation of the
      Company;

              
	 
      	 
      	 
      
	 
      	
                5.

              	
                any
      attempt to conceal a potential Harmful Violation or to conceal evidence of
      a potential Harmful Violation; or

              
	 
      	 
      	 
      
	 
      	
                6.

              	
                

                  any
      Retaliation (defined below) for any report, complaint, allegation or other
      disclosure made pursuant to this policy (a “Disclosure”).

                

              

      

       

      

      
        	 
      	 
      
	
                1.

              	
                General
      Policy.

              

      

       

      The
Company notes that the Sarbanes-Oxley Act of 2002 provides certain legal
protections to employees who provide information in investigations - including
internal investigations - into certain types of violations of the securities
laws and regulations, or who file proceedings relating

       

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    to
similar violations. Under these laws, the Company, the Bluerock Affiliates and
their officers, employees and agents are prohibited from discharging, demoting,
suspending, threatening, harassing, or in any other manner discriminating
against an employee in connection with the terms and conditions of his or her
employment because of any lawful act done by such employee to provide
information which such employee reasonably believes constitutes a violation of
any rule of the Securities and Exchange Commission or any other provision of
federal law relating to fraud against the stockholders of the Company
(collectively, ‘Retaliate’ or “Retaliation”).

     

    Accordingly,
any Affected Person who, in Good Faith, makes a Disclosure pursuant to this
policy with respect to a Harmful Violation or potential Harmful Violation is
referred to as a “Whistleblower” and
shall be protected from any Retaliation by the Company or a Bluerock Affiliate.
“Good Faith”
means that the employee has a reasonably held belief that the Disclosure made by
the Affected Person is true and has not been made for personal gain, for
malicious or frivolous reasons, or for any ulterior motive:

    
      	 
      	 
      
	
              2.

            	
              Purpose
      of the Policy.

            

    

     

    The
Company has adopted this policy in order to:

    
      	 
      	 
      	 
      
	 
      	
              (a)

            	
              cause
      Harmful Violations to be disclosed before they can disrupt the business or
      operations of the Company, or lead to serious loss;

            
	 
      	 
      	 
      
	 
      	
              (b)

            	
              promote
      a climate of accountability with respect to Company resources, including
      the employees of any Bluerock Affiliate; and

            
	 
      	 
      	 
      
	 
      	
              (c)

            	
              ensure
      that no Affected Person should feel at a disadvantage in raising
      legitimate concerns.

            

    

     

    This
policy provides a means whereby Affected Persons can safely raise, internally
and at a high level, serious concerns and disclose information that the Affected
Person believes in Good Faith could cause a Harmful Violation. This policy does
not apply to all grievances, such as those related to terms of employment or
those concerns that are specifically addressed by existing Company policies
relating to discriminatory harassment, and any such other grievances not
specifically covered by this policy shall be handled in the manner stated in
such other existing policies.

    
      	 
      	 
      
	
              3.

            	
              Affected
      Persons Protected.

            

    

     

    This
policy and the related procedures offer protection from Retaliation to Affected
Persons, who make any Disclosure with respect to matters that are, or could
reasonably give rise to, Harmful Violations, provided the Disclosure is
made:

    
      	 
      	 
      
	
              •

            	
              In
      Good Faith (as defined above);

            
	 
      	 
      
	
              •

            	
              In
      the reasonable belief of the individual making the Disclosure that the
      conduct or matter covered by the Disclosure could give rise to or has
      resulted in a Harmful Violation; and

            
	 
      	 
      
	
              •

            	
              Pursuant
      to the procedures contained in Section 7
below.

            

    

     

    2

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    No
complaint that satisfies these conditions shall result in any Retaliation or
threat of Retaliation against the Whistleblower by the Company, a Bluerock
Affiliate or any officer, employee, contractor, subcontractor or agent of the
Company or a Bluerock Affiliate. Any acts of Retaliation against a Whistleblower
shall be treated by us as a serious violation of Company policy and could result
in discharge.

    
      	 
      	 
      
	
              4.

            	
              Confidentiality
      of Disclosure.

            

    

     

    The
Company will use its best efforts to treat all Disclosures by Whistleblowers as
confidential and privileged to the fullest extent permitted by law so long as
maintaining such confidentiality and privilege is compatible with a fair
investigation. The Company will exercise particular care to keep confidential
the identity of any Affected Person making a Disclosure under this procedure
until a formal investigation is undertaken. Thereafter, the identity of the
Affected Person making the Disclosure may be kept confidential, if requested,
unless (a) such confidentiality is incompatible with a fair investigation, (b)
there is an overriding reason for identifying or otherwise disclosing the
identity of the Whistleblower, or (c) such disclosure is required by law. In any
such instance, the Affected Person making the Disclosure will be so informed in
advance of his or her being identified with the Disclosure. Where disciplinary
proceedings are invoked against any individual following a Disclosure under this
procedure, the Company will normally require the name of the person making the
Disclosure to be disclosed to the person subject to such proceedings. In
addition, the person making the Disclosure confidentially should be informed
that his or her identity will be disclosed if, after the investigation, it is
reasonably determined that the Disclosure was made maliciously or
recklessly.

     

    While the
Company encourages individuals to put their name to any Disclosure they make,
any Affected Person may make an anonymous Disclosure by completing a Complaint
Form in the form attached as Exhibit “A” to this policy (except for the personal
information contained in Section 2) and submitting it anonymously to one of the
Designated Recipients set forth in Section 7.1. In responding to an anonymous
Disclosure, the Company will pay due regard to fairness to any individual named
in the Disclosure, the seriousness of the issue raised, the credibility of the
information or allegations in the Disclosure and the prospects of an effective
investigation and discovery of evidence.

     

    Investigations
will be conducted as quickly as possible, taking into account the nature and
complexity of the Disclosure and the issues raised therein.

    
      	 
      	 
      
	
              5.

            	
              Unsubstantiated
      Allegations.

            

    

     

    If an
Affected Person makes a Disclosure in Good Faith pursuant to this policy and any
facts alleged are not confirmed by subsequent investigation, no action will be
taken against the Affected Person as a Whistleblower. In making a Disclosure,
all individuals should exercise due care to ensure the accuracy of the
information disclosed. Persons making a Disclosure that is determined to be
without substance and to have been made for personal gain or for malicious or
frivolous reasons will not be protected by this policy.

     

    Where
alleged facts disclosed pursuant to this policy are not substantiated (a) the
conclusions of the investigation will be made known both to the person who made
the Disclosure and to the

     

    3

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    person(s)
against whom any allegation was made in the Disclosure, and (b) all papers
relating to the allegation and investigation will be removed from the
record.

    
      	 
      	 
      
	
              6.

            	
              Follow-Up.

            

    

     

    A
detailed report of all substantive Disclosures and any subsequent actions taken
will be made to the Audit Committee of the Company's Board of Directors (the
“Audit
Committee”) where the Disclosure relates to an issue or matter within its
purview. In all other cases, a summary report will be made to the Audit
Committee.

     

    The
conclusion of any investigation will be communicated to the person or persons
against whom the Disclosure is made and to the Affected Person.

    
      	 
      	 
      
	
              7.

            	
              Procedures.

            

    

    

    
      	 
      	 
      
	
              7.1

            	
              Any
      Disclosure made by an Affected Person under this policy must be submitted
      to one of the following (each, a “Designated
      Recipient”), as appropriate:

            
	 
      	 
      	 
      
	 
      	
              (a)

            	
              directly
      to the President of a Bluerock Affiliate; or

            
	 
      	 
      	 
      
	 
      	
              (b)

            	
              to
      the Chairman of the Audit Committee.

            
	 
      	 
      
	 
      	
              Submissions
      to the Chairman of the Audit Committee should be made through the
      Company's Compliance Officer (as defined below) and should be addressed as
      follows:

            
	 
      	 
      
	 
      	
              Personal
      and Confidential Communication/Whistleblower Submission Only Recipient May
      Open

            
	 
      	 
      
	 
      	
              Bluerock
      Enhanced Multifamily Trust, Inc.

              680
      5th
      Avenue, 16th
      Floor

              New
      York, NY 10019

              Attention:
      Compliance Officer

            
	 
      	 
      
	 
      	
              Upon
      receiving a Disclosure, the Designated Recipient shall immediately enter
      the pertinent information into a log and open a file for each Disclosure,
      which file shall be maintained in a secure location to protect the
      confidentiality of the Disclosure. A sample Complaint Form is attached as
      Exhibit “A” hereto, which is recommended for use by the Designated
      Recipient in documenting matters covered by each
    Disclosure.

            
	 
      	 
      
	
              7.2

            	
              An
      Affected Person should expect some response to the Disclosure no later
      than two weeks after the Disclosure, unless the Affected Person believes
      in good faith that conditions warrant a quicker reply, in which case the
      Affected Person shall detail those conditions as part of his or her
      initial Disclosure and suggest expedited treatment.

            
	 
      	 
      
	
              7.3

            	
              An
      Affected Person who is not satisfied with the response after following the
      procedure set out in Section 7.1 or who has not received a response in the
      time period contained in Section 7.2 may invoke this Section 7.3. The
      Affected Person must continue to discuss the Disclosure with the
      Designated Recipient. However, the Disclosure shall thereafter also be
      delivered by the Designated Recipient, in writing, and confidentially, to
      the Audit

            

    

     

    4

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

    
      	 
      	 
      
	 
      	
              Committee.
      The Audit Committee shall then make a preliminary investigation of the
      facts alleged in the Disclosure and may, in its discretion, advise the
      compliance officer designated by the Audit Committee to administer this
      policy (the “Compliance Officer”-)
      in writing, with a request that the Compliance Officer investigate further
      and report to the Audit Committee in a period of time specified by the
      Chairman of the Audit Committee. The Compliance Officer may appoint
      another person to undertake the preliminary investigation, provided that
      the findings and conclusions of the person so appointed shall be reported
      to, and endorsed by, the Compliance Officer before the report is made to
      the Audit Committee. If it is determined on preliminary investigation that
      the matter raised or alleged in the Disclosure invoked under this Section
      7.3 is without merit and should be dismissed, the Audit Committee should
      retain counsel to confirm such conclusion prior to communication to the
      Whistleblower of the decision and the reasons for such
      dismissal.

            
	 
      	 
      
	
              7.4

            	
              If
      on preliminary examination the matter raised or alleged in any Disclosure
      is judged to be without substance or merit, the matter shall be dismissed
      and the Whistleblower informed of the decision and the reasons for such
      dismissal. If it is judged that the allegation(s) or issue(s) covered in
      the Disclosure have merit, the matter shall be dealt with in accordance
      with this policy, any Bluerock Affiliates' normal disciplinary procedures
      and/or as otherwise may be deemed appropriate according to the nature of
      the case. The Whistleblower shall be informed as to the ultimate outcome
      of the investigation.

            
	 
      	 
      
	
              7.5

            	
              Subject
      to Section 7.4, if any Disclosure relates to the alleged conduct of a
      director or officer of the Company, the Disclosure shall be referred to
      the Chairman of the Audit Committee for investigation by the Audit
      Committee. It is highly recommended that the Audit Committee retain
      counsel to investigate the facts and allegations contained in such
      Disclosure, as well as in all cases where a Disclosure contains
      allegations of any improper accounting entry, violations of internal
      accounting controls or improper auditing matters, whether or not the
      allegation implicates an officer or director of the Company. If the
      Disclosure relates to the alleged conduct of a director or officer of any
      Bluerock Affiliate (other than the Company), the Disclosure shall be
      referred to the Chairman of the Audit Committee who shall appoint an
      appropriate investigating officer to investigate the facts and allegations
      contained in the Disclosure.

            
	 
      	 
      
	
              7.6

            	
              Disclosures
      received by a Designated Recipient anonymously or with instructions from
      the Affected Person to keep the Disclosure confidential shall be handled
      as provided in Section 4 of this policy.

            
	 
      	 
      
	
              7.7

            	
              The
      file for each Disclosure shall be retained by the Company for a period of
      10 years following the date of conclusion of the
      investigation.

            

    

    

    
      	 
      	 
      
	
              8.

            	
              Annual
      Review and Reporting.

            

    

     

    The
Compliance Officer shall make a quarterly report to the Audit Committee of (i)
the number of Disclosures made, (ii) the number of investigations commenced in
response to Disclosures, (iii) the number of wrongdoings discovered, and (iv)
all disciplinary actions taken in response to matters discovered through
Disclosures. This policy will be reviewed annually by the Audit Committee after
consultation with the Compliance Officer, taking into account the
effectiveness

     

    5

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    of the
policy in promoting proper disclosure, but with a view to minimizing the
opportunities to cause improper investigations.

    
      	 
      	 
      
	
              9.

            	
              Cooperation
      by Bluerock Affiliates

            

    

     

    This
policy is designed to cover Disclosures of Harmful Violations directly or
indirectly affecting the Company as a public company. Since the Company does not
currently have any employees and its day-to-day operations and asset and
property management functions are performed by employees of any Bluerock
Affiliate pursuant to executed agreements, this policy shall be formally adopted
by each Bluerock Affiliate with which the Company has a contractual
relationship, and each such Bluerock Affiliate shall fully cooperate with the
Company in enforcing the provisions of this policy.

     

    6

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    EXHIBIT
A

     

    COMPLAINT
FORM

    
      	 
      	 
      	 
      
	
              1.

            	
              Designated
      Recipient/Case
      Number:_________________________________________________________________________

            	 
      
	 
      	 
      	 
      
	
              2.

            	
              (Note:
      The information relating to the Affected Person in this Section 2 should
      not be completed if the Disclosure is submitted
    anonymously)

            	 
      
	 
      	 
      	 
      
	 
      	
              Affected
      Person Name: _________________________________________Tel:
      ___________________________________

            	 
      
	 	 	 
	 
      	
              Supervisor:
      _____________________________________________E-mail:
      ______________________________________

            	 
      
	 
      	 
      	 
      
	
              3.

            	
              Department
      of Affected Person:
      _________________________________________________________________________

            

    

    
      	 	 
	
              4.

            	Type
      of
      Violation:                 
      o
      Legal          o
      Accounting/Auditing       o
    Retaliation
	 	 
	
              5.

            	
              Date
      Affected Person became aware of Harmful Violation:
      _____________________________________________________

            
	 	 
	
              6.

            	Harmful
      Violation
      is:             
      o
      Ongoing              
      o
      Completed                    
      o
  Unsure
	 	 	 
	
              7.

            	
              Department
      suspected of Harmful Violation:
      _______________________________________________________________

            	 
      
	 	 	 
	
              8.

            	
              Individuals
      suspected of Harmful Violation:
      _______________________________________________________________

            	 
      
	 	 	 
	
              9.

            	
              Describe
      the relevant facts of the Harmful Violation:
      _________________________________________________________

            	 
      
	 
      	_________________________________________________________________________________________________ 
      	 
      
	 	_________________________________________________________________________________________________   	 
	 	 	 
	
              10.

            	
              Describe
      how the Affected Person became aware of the Harmful
    Violation:

            	 
      
	 	_________________________________________________________________________________________________   	 
	 	_________________________________________________________________________________________________   	 
	 
      	_________________________________________________________________________________________________   
      	 
      
	 	 	 
	
              11.

            	
              Describe
      the steps taken by Affected Person prior to contacting the Designated
      Recipient: ____________________________

            	 
      
	 	_________________________________________________________________________________________________   	 
	 	_________________________________________________________________________________________________   	 
	 	 	 
	
              12.

            	
              Who,
      if anyone, may be harmed or adversely affected by the Harmful
      Violation?

            	 
      
	 
      	_________________________________________________________________________________________________   
      	 
      
	 	_________________________________________________________________________________________________   	 
	 	_________________________________________________________________________________________________   	 
	 
      	 
      	 
      
	
              13.

            	
              If
      the Harmful Violation is legal, estimate the amount of potential loss to
      the Company as a result of the Harmful Violation:
    $__________

            	 
      
	 
      	 
      	 
      
	
              14.

            	
              If
      the Harmful Violation relates to accounting/auditing matters, estimate the
      amount of the misreporting and indicate the affected category (or
      categories) of misreporting: $__________

            	 
      
	 
      	 
      	 
      
	 
      	Category:     o
      Assets     o Liabilities    o
Expenses	 
      
	 
      	      o
      Revenues         o
      Valuation            
      o Equity	 
      
	 	 	 
	
              15.

            	 Provide
      any suggestions for remedying the Harmful Violation:
      _________________________________________________	 
	 	_________________________________________________________________________________________________   	 
	 	_________________________________________________________________________________________________

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