8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 20, 2011

BLUEROCK ENHANCED MULTIFAMILY TRUST, INC.

(Exact Name of Registrant as Specified in Its Charter)

Maryland	333-153135	26-3136483
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	IRS Employer Identification No.

Heron Tower, 70 East 55th Street, 9th Floor

New York, NY  10022

(Address of principal executive offices)

Registrant’s telephone number, including area code: (212) 843-1601

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 1.01  ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT

On January 20, 2011, BEMT Meadowmont, LLC, a wholly owned subsidiary of our operating partnership (“BEMT Meadowmont”) entered into an agreement with Bluerock Special Opportunity + Income Fund II, an affiliate of our sponsor (“SOIF II”) for a line of credit represented by a promissory note (the "Note").  Under the terms of the Note, BEMT Meadowmont may borrow, from time to time, up to $500,000, for general working capital.  The Note has a six-month term from the date of the first advance and matures on July 20, 2011.  It bears interest compounding monthly at a rate of 30-day LIBOR + 5.00%, subject to a minimum rate of 7.00%, annualized.  Interest on the loan will be paid on a current basis from cash flow distributed to us from B R Meadowmont JV Member, LLC (the “Meadowmont JV Member"). The Note may be prepaid in whole or in part at any time or from time to time without penalty. The Note is secured by a pledge of our indirect membership interest in the Meadowmont Property and a pledge of our direct membership interest in the Meadowmont JV Member.

ITEM 2.03  CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCESHEET ARRANGEMENT OF A REGISTRANT

The information in this report required by Item 2.03 is included in Item 1.01 above and is incorporated herein by reference.

ITEM 9.01  FINANCIAL STATEMENTS AND EXHIBITS

(d)  Exhibits

10.1  Promissory Note between BEMT Meadowmont, LLC and Bluerock Special Opportunity + Income Fund II, dated as of January 20, 2011.

10.2  Pledge and Security Agreement between BEMT Meadowmont LLC and Bluerock Special Opportunity & Income Fund II, dated as of January 20, 2011.

1

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

BLUEROCK ENHANCED MULTIFAMILY TRUST, INC.

DATE: January 26, 2011                                                                         /s/ R. Ramin Kamfar                                                     ;                       

R. Ramin Kamfar

Chief Executive Officer and Chairman of the Board

(Principal Executive Officer)

2

EX-10.1

SECURED PROMISSORY NOTE

January 20, 2011

Up to $500,000

For value received, BEMT MEADOWMONT, LLC, a Delaware limited liability company (the “Borrower”), hereby promises to pay to the order of BLUEROCKSPECIAL OPPORTUNITY + INCOME FUND II, LLC, a Delaware limited liability company (together with its successors and assigns, the “Lender”) the principal sum of up to Five Hundred Thousand dollars ($500,000.00), plus interest, fees and costs, in accordance with the terms and conditions of this promissory note (the “Note”). 
60;The Note shall accrue interest at the rate of the greater of:  (a) 30-Day LIBOR plus 5.00%, or (b) seven percent (7.0%) per annum, compounded monthly.  All outstanding principal and interest shall be due and payable six months from the date of the first advance of funds (the “Due Date”).

Commencing on the first day of each month following the first advance of funds, until the Note is fully paid, Borrower shall pay to Lender monthly all distributions, proceeds, income, payments, dividends and capital repayments that Borrower receives from any and all the membership interests that it owns in BR Meadowmont JV Member, LLC, a Delaware limited liability company and any income, distributions, dividends, proceeds and capital repayments that Borrower receives from any other source, to the extent of any interest due for the month plus any accrued interest and fees, if any.  All payments hereunder shall be applied, first, to the payment of fees, interest and other obligations (other than principal) hereunder in such order and priority as Lender shall determine in its discretion, and second, to the payment of principal.

This Note may be prepaid in whole or in part at any time or from time to time without penalty.  If this Note is not paid in full on the Due Date, then, at the Lender’s election, all amounts not paid when due at the Due Date shall become part of principal and shall thereafter accrue interest at the rate of thirteen percent (13%) per annum, compounded monthly.  In the event of an acceleration of the maturity of this Note (as described below), this Note shall become immediately due and payable without presentation, demand, protest or notice of dishonor, all of which are hereby waived by the Borrower.  The Borrower also shall pay and this Note shall evidence Borrower’s obligation to pay Lender any and all actual costs incurred by Lender for t he interpretation, performance, exercise, enforcement or protection of its rights hereunder and for the collection of Borrower’s obligations under this Note and for the protection of the security for this Note, including reasonable attorneys’ fees and expenses, and all costs to collect, possess, preserve, repair and liquidate the collateral given by Borrower to secure the obligations owed to Lender.

If the rate of interest required to be paid hereunder exceeds the maximum rate permitted by law, such rate of interest shall be automatically reduced to the maximum rate permitted by law and any amounts collected in excess of the permissible amount shall be returned to Borrower or applied to principal all pursuant to the terms of and as further set forth herein.  To the fullest extent permitted by law, interest shall continue to accrue after the filing by or against Borrower of any petition seeking any relief in bankruptcy or under any act or law pertaining to insolvency or debtor relief, whether state, federal or foreign.

If Borrower makes any payment to Lender that is subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be repaid to a trustee, receiver or any other party, then, to the extent of such payment, the obligation intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been received by Lender.

The Borrower covenants, warrants, and represents to the Lender that:

(i)	the execution, delivery and performance of this Note have been duly authorized;
(ii)	this Note is enforceable against the Borrower in accordance with its terms;
(iii)	the execution and delivery of this Note does not violate or constitute a breach of any agreement to which the Borrower is a party; and

(iv) the loan evidenced by this Note is for commercial purposes and will not be used in any consumer transaction.

Payment of this Note is secured by the pledge of the Collateral as that term is defined in the Pledge and Security Agreement, of even date hereof, among the Borrower and the Lender and the Pledge and Security Agreement, of even date hereof, among the Lender, Bluerock Enhanced Multifamily Holdings, L.P. and Borrower, of even date herewith (collectively, the “Pledge Agreement”).

The occurrence of any one or more of the following shall constitute an Event of Default under this Note:

(a) the Borrower fails to pay Lender any interest, principal or other money due and payable by Borrower to Lender under this Note on or before the due dates thereof;

(b) the failure of Borrower to comply with any material covenant set forth herein and the expiration of any applicable notice and cure provisions contained herein;

(c) the occurrence of an Event of Default under the Pledge Agreement and the expiration of any applicable notice and cure provisions contained therein;

(d) the Borrower terminates its existence, voluntarily or involuntarily, allows the appointment of a receiver for any part of its property or makes an assignment for the benefit of creditors; or

(e) the Borrower does any of the following:

(i)	admits in writing its inability to pay its debts generally as they become due;
(ii)	consents to, or acquiesce in, the appointment of a receiver, liquidator or trustee of itself or of the whole or any substantial part of its properties or assets;
(iii)	files a petition or answer seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under the Federal Bankruptcy laws or any other applicable law;
(iv)	has a court of competent jurisdiction enter an order, judgment or decree appointing a receiver, liquidator or trustee of Borrower, or of the whole or any substantial part of the property or assets of Borrower, and such order, judgment or decree shall remain unvacated or not set aside or unstayed for sixty (60) days;
(v)	has a petition filed against it seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under the Federal Bankruptcy laws or any other applicable law and such petition shall remain undismissed for sixty (60) days;
(vi)	has, under the provisions of any other law for the relief or aid of debtors, any court of competent jurisdiction assume custody or control of Borrower or of the whole or any substantial part of its property or assets and such custody or control shall remain unterminated or unstayed for sixty (60) days;
(vii)	has an attachment or execution levied against any substantial portion of the property of Borrower which is not discharged or dissolved by a bond within thirty (30) days; or
(viii)	has any materially adverse change in its financial condition since the date of this Note.

Upon the occurrence of an Event of Default, the Lender may at any time thereafter exercise any one or more of the following remedies:

(a) the Lender may accelerate the Due Date and declare the unpaid principal balance, accrued but unpaid interest and all other amounts payable hereunder at once due and payable,

(b) the Lender may set off the amount due against any and all accounts, credits, money, securities or other property held by or in the possession of the Lender;

(c) the Lender may exercise any of its other rights, powers and remedies available at law or in equity.  All of the rights and remedies of the Lender under this Note, at law or in equity are cumulative, and the exercise by the Lender of any one or more of such rights and remedies shall not preclude the simultaneous or later exercise by the Lender of any or all such other rights and remedies.

The enumeration of Lender’s rights and remedies herein is not intended to be exhaustive and the exercise by Lender of any right or remedy shall not preclude the exercise of any other rights or remedies, all of which shall be cumulative, and shall be in addition to any other right or remedy given hereunder or under the Pledge Agreement or that may now or hereafter exist in law or in equity or by suit or otherwise.

This Note shall be governed by and construed in accordance with the internal laws of the State of New York, notwithstanding any conflicts-of-law provision to the contrary.  The Borrower and Lender waive their respective rights to a jury trial to the maximum extent permitted by law for any claim or cause of action arising out of this Note.  Each party has reviewed this waiver with its counsel.

Except as specifically provided herein and except as prohibited by law, Borrower hereby waives presentment, demand, protest and notice of dishonor, as well as the benefit of any exemption under the Homestead and all other exemption or insolvency laws as to this debt.

Lender’s failure at any time to require strict performance by Borrower hereunder shall not waive or affect any right of Lender at any time thereafter to demand strict performance, and any waiver of any Event of Default by Lender shall not waive or affect any other Event of Default, whether prior or subsequent thereto, and whether of the same or a different type.  None of the provisions of this Note shall be deemed waived by any act, knowledge or course of dealing of Lender, or its agents, except by an instrument in writing signed by Lender and directed to Borrower specifying such waiver.

All notices, requests, demands and other communications with respect hereto shall be in writing and shall be delivered by hand against a receipt, sent prepaid by FedEx (or a comparable overnight delivery service) or sent by the United States mail, certified, postage prepaid, return receipt requested, at the addresses designated below.  Any notice, request, demand or other communication delivered or sent in the manner aforesaid shall be deemed given or made (as the case may be) only when actually received by the intended recipient.  Rejection or other refusal to accept or the inability to deliver because of a changed address of which no written notice was given shall be deemed to be receipt of the notice, request, demand or other communication sent as of the date three (3) business days following the date such rejec ted, refused or undeliverable notice was sent.  The Borrower or the Lender may change their addresses by notifying the other party of the new address in any manner permitted by this paragraph.

If to the Borrower:                c/o Bluerock Enhanced Multifamily Trust, Inc.

Heron Tower, 70 East 55th Street, 9th Floor

New York, New York 10022

Attn:  R. Ramin Kamfar

Fax:  (212) 843-3411

If to the Lender:                    c/o Bluerock Real Estate, LLC

Heron Tower, 70 East 55th Street, 9th Floor

New York, New York 10022

Attn:  R. Ramin Kamfar

Fax:  (212) 843-3411

With a Copy to:                    Thomas G. Voekler, Esq.

Hirschler Fleischer, a Professional Corporation

2100 East Cary Street

Richmond, Virginia  23223-7078

Fax:  (804) 644-0957

Email:  tvoekler@hf-law.com

To the extent any provision herein is prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Note.

This Note shall be binding upon and inure to the benefit of the heirs, successors and assigns of the parties.

IN WITNESS WHEREOF, the Borrower has caused this Note to be executed by its duly authorized company officer, as of the day and year first above written.

Borrower:

BEMT Meadowmont, LLC

a Delaware limited liability company

By:           Bluerock Enhanced Multifamily Holdings, L.P.,

a Delaware limited partnership

Its:           Sole Member

By:           Bluerock Enhanced Multifamily Trust, Inc.,

a Maryland corporation

Its:           General Partner

By:             /s/  Jordan Ruddy

Name:      Jordan Ruddy

Title:         COO

EX-10.2

PLEDGE AND SECURITY AGREEMENT

This PLEDGE AND SECURITY AGREEMENT (this “Agreement”), dated as of January 20, 2011, made by BEMT Meadowmont, LLC, a Delaware limited liability company (“BEMT”) for Bluerock Special Opportunity + Income Fund II, LLC, a Delaware limited liability company (the “SOIF II”), recites and provides:

Recitals:

A.           BEMT has entered into that certain Secured Promissory Note dated January 20, 2011 for the benefit of SOIF II (the “BEMT Note”).

B.           BEMT desires to grant SOIF II a security interest in the Pledged Collateral (as defined herein) to secure BEMT’s performance under the BEMT Note in accordance with the provisions hereof.

C.           BEMT owns a membership interest in BR Meadowmont Managing Member, LLC, a Delaware limited liability company (the “JV”).

Agreement:

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and to further induce SOIF II to fund the BEMT Note, BEMT and SOIF II hereby covenant and agree as follows:

Section 1. Definitions.                                            Unless the context expressly or by necessary implication otherwise requires, (a) in addition to any terms defined elsewhere in this Agreement, the capitalized terms defined in this Article 1 shall, for the purposes of this Agreement, have the meanings set forth below, (b) except as otherwise defined or limited herein, terms defined in the U CC when used herein shall have the respective meanings attributed to them therein, and (c) except as otherwise defined or limited herein, terms defined in the BEMT Note when used herein shall have the respective meanings assigned to them in the BEMT Note.

“BEMT Note” shall mean the Secured Promissory Note dated January 20, 2011 by BEMT as Borrower for the benefit of SOIF II as Lender.

“JV Membership Interests” shall mean any and all membership interests of the JV owned by BEMT at any time and from the time included in the Pledged Collateral, free and clear of any liens or encumbrances except as created herein.

“Obligations” shall mean the punctual payment, when and as due, of any and all accrued interest and outstanding principal of the BEMT Note and any other costs, liabilities, reimbursements, etc. required under the terms of the BEMT Note.

“Pledged Collateral” shall have the meaning set forth in Section 2 hereof.

“Proceeds” shall mean any and all “proceeds,” as defined in the UCC, of any and all Pledged Collateral and, in any event, at any time whatsoever arising or receivable, any and all cash, shares of stock, instruments, other securities, rights, properties, interests, claims, and other proceeds arising in connection with any collection, exchange, sale, transfer, or other disposition

of any Pledged Collateral or interest therein or into which any Pledged Collateral or interest therein is voluntarily or involuntarily converted, and other amounts from time to time paid or payable under or in connection with any Pledged Collateral.

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

“Transaction Documents” shall mean the BEMT Note, this Agreement and that certain Pledge and Security Agreement by and among SOIF II, BEMT and Bluerock Enhanced Multifamily Holdings, L.P.

Section  2. Pledge and Grant of Security Interest.  As collateral security for BEMT’s performance under the BEMT Note and in order to induce SOIF II to fund the BEMT Note, BEMT hereby pledges, assigns, hypothecates, transfers, and delivers to SOIF II and grants to SOIF II a security interest in, all BEMT’s right, title, and interest (but none of BEMT’s obligations) in, to, and under the following (the “Pledged Collateral”), with full authority to sell, transfer, and rehypothecate:

(a)  all of the JV Membership Interests; and

(b) all dividends and other distributions, whether in cash, property, obligations, or any other form whatsoever, from time to time, payable, or distributable in respect of or in exchange for any or all of the JV Membership Interests; and

(c) all right, title and interest of BEMT in and to any of the property of the JV; and

(d) all right, title and interest of BEMT to participate in the management of the JV; and

(e) all interest, dividends, cash, checks, instrument and other property now or in the future payable under or received, receivable or otherwise distributed in respect of or in substitution or exchange for the JV Membership Interests, including amounts past due and unpaid; and

(f) all fees and other amounts payable by BEMT to SOIF II, but excluding any such amount paid or prepaid for reimbursement of any cost or expense incurred or to be incurred by BEMT for any purpose or on behalf of any person or entity whatsoever; and

(g) any and all Proceeds of any and all of the foregoing, whether or not constituting any kind or type of tangible or intangible personal or real property whatsoever and whether now owned or hereafter acquired, including without limitation certificates, instruments, shares of stock, other securities, and rights, privileges, and options pertaining to any thereof,

in each case, howsoever BEMT’s interest therein may arise or appear, whether by ownership, security interest, claim, or otherwise.

Section 3. General Covenants. So long as any Obligation remains unpaid, BEMT covenants and agrees that, unless SOIF II otherwise expressly consents in writing:

Section 3.1. Limitations on Dispositions, etc. BEMT shall not directly or indirectly (a) suffer any amendment or other modification of any JV Membership Interests or (b) sell, assign (by operation of law or otherwise), exchange, liquidate, grant, or otherwise dispose of any JV Membership Interests or any lien or other interest therein.

Section 3.2. Changes in BEMT’s Name.  BEMT shall not change, or suffer or permit any change of, BEMT’s name or identity which could in any manner make any financing or continuation statement filed in connection herewith (including without limitation under this Section 3.2) “seriously misleading,” as defined in the UCC, unless (a) BEMT shall have given SOIF II no less than ninety (90) days’ prior written notice thereof, (b) BEMT shall have, prior to such change, delivered to SOIF II acknowledgment copies of financing statements duly completed, executed, and filed in each jurisdiction necessary or advisable to ensure the continuous perfection of all security interests granted pursuant to this Agreement, and (c) BEMT shall have taken all other action or actions necessary, or reasonably requested by SOIF II, to preserve and protect all such security interests, including without limitation the continuous perfection thereof.

Section 3.3. Voting, etc., of Pledged Collateral.  So long as no Event of Default (defined hereinafter) shall have occurred and be continuing, BEMT may vote any JV Membership Interests for any purpose and to any effect to the extent not inconsistent with the provisions of the Transaction Documents, and, upon BEMT’s reasonable written request therefor, SOIF II will execute and deliver (or cause to be executed and delivered) to BEMT any such proxy or other instrument as is reasonably necessary to enable BEMT to vote any JV Membership Interests fo r any such purpose and to any such effect.

Section 3.4. Certain Rights respecting Pledged Collateral.  SOIF II shall have the right, exercisable at any time and from time to time in its sole discretion, to cause the interest of SOIF II in any Pledged Collateral to be duly noted on any transfer books for JV Membership Interests or other records therefor.

Section 3.5. No Issuance of Additional Membership Interests.  During the term of this Agreement, BEMT shall not cause, suffer, or permit the JV to issue any additional securities of any class or nature, nor to take any other action, or omit to take any action, the result of which is to render the JV Membership Interests to be less than 50% of the issued and outstanding securities of the JV.

Section 4. Default.

Section 4.1. Events of Default.  An Event of Default shall occur hereunder upon the occurrence of any one or more of the following:

(a) If BEMT shall in any manner breach or violate, or fail to perform or satisfy, any term, covenant, condition, obligation, or other provision hereof and such default shall continue at any time after the period of thirty (30) consecutive days next following the date on which SOIF II shall have given BEMT notice specifying such default and requesting that such default be remedied; or

(b) If any “Event of Default” shall occur under one or more of the Transaction Documents.

Section 4.2. Remedies; Rights Upon Default.  At any time after the occurrence of an Event of Default, in addition to any other rights, powers, and remedies available under any Transaction Document, or at law, in equity, by statute, or otherwise, SOIF II shall have all the following rights, powers, and remedies, which SOIF II may (but shall not be obligated to) exercise, concurrently or singly, in whole or in part, at any time and from time to time, by or through such officers, agents, employees, or other rep resentatives of SOIF II as SOIF II may select, without any hindrance or delay by BEMT and without any notice or demand upon BEMT except as expressly required in this Section 4.2:

Section 4.2.1. Acceleration.  SOIF II may declare any and all Obligations to be immediately due and payable.

Section 4.2.2. Accounts, etc.  Until the occurrence of an Event of Default, BEMT may collect and retain any and all amounts owing under or in connection with any Pledged Collateral, which SOIF II hereby expressly authorizes BEMT to do, but, after the occurrence of an Event of Default, (a) SOIF II may curtail or terminate such authority at any time and from time to time by delivery of a default notice requesting the same (the “Default Notice”) and BEMT shall, at all times after BEMT’s receipt of the Default Notice, segregate all such amounts from BEMT’s other funds and property, and shall, immediately upon BEMT’s receipt of the Default Notice, deliver actual possession of all such amounts to SOIF II and (b) BEMT shall hold and be deemed to hold all such amounts in trust for SOIF II and as SOIF II’s bailee.

Section 4.2.3. UCC, Other Rights.  SOIF II shall have and may exercise all the rights, powers, and remedies of a secured party under the UCC, and, in addition and not in limitation of the generality of the foregoing:

(a) without demand of payment or performance or other demand, advertisement, or notice of any kind (all and each of which demands, advertisements, and notices, excepting only the notice of time and place of public or private sale specified in this Section 4.2.3 and any other demand, advertisement, or notice which by law may not be waived, BEMT hereby expressly waives) to or upon BEMT or any other person or entity, SOIF II may (1) immediately enter BEMT’s premises without legal process and without any liability therefor, (2) immediately collect, receive, appropriate, and realize upon any Pledged Collateral, (3) immediately sell, lease, assign, give any options to purchase, or otherwise dispose of and deliver any Pledged Collateral (or contract to do so) at any public or private sale, at any exchange, broker’s board, any o f SOIF II’soffices, or elsewhere, at such prices as SOIF II may in good faith deem appropriate, for cash, on credit, or for future delivery with or without assumption of any credit risk, and (4) require BEMT to assemble any Pledged Collateral, and BEMT shall make all such Pledged Collateral available to SOIF II at such place or places as SOIF II shall select, which in any event shall be reasonably convenient toSOIF II; and

(b) SOIF II shall have the right upon any such public sale, and, to the extent permitted by law, upon any such private sale, to purchase any Pledged Collateral so sold, free of any right or equity of redemption in BEMT; and

(c) SOIF II need not give more than fifteen (15) days prior written notice of the time and place of any public sale or of the time after which any private sale may occur, which notice shall constitute reasonable notification thereof; and

(d) to the extent permitted by applicable law, BEMT waives all claims, damages, and demands against SOIF II arising out of the repossession, retention, or usage by SOIF II or any agent, or other representative thereof of any Pledged Collateral.

Section 4.3. Rights of Conversion, etc.  At any time and from time to time after the occurrence of an Event of Default, inSOIF II’s sole discretion and on such terms and conditions as SOIF II may deem desirable, SOIF IImay (but shall not be obligated to) exercise any and all rights of conversion, exchange, subscription, and other rights, privileges, or options pertaining to any Pledged Collateral as if the absolute owner t hereof, including without limitation any right to exchange any Pledged Collateral upon any merger, consolidation, reorganization, recapitalization, or other adjustment of SOIF II or upon any exercise by SOIF II of any right, privilege, or option pertaining to any Pledged Collateral, and, in connection therewith, to deposit and deliver any Pledged Collateral with any clearing corporation, custodian bank, depository, registrar, transfer or other agent, committee, or other person or entity whatsoever, including without limitation any nominee of any thereof.

Section 4.3.1. Assistance in Complying with Securities Laws.  BEMT shall, from time to time at SOIF II’s request and BEMT’s sole expense, assist SOIF II in making any sale or other disposition of the Pledged Collateral in compliance with any and all applicable securities laws, which assistance shall include without limitation:

(a) providing SOIF II, and prospective purchasers of the Pledged Collateral such information respecting the properties, prospects, profits, performance, business, and condition (financial and otherwise) of the JV as may be reasonably available; and

(b) causing SOIF II to permit the prospective purchasers, and their respective employees, agents, and other representatives to enter the premises of BEMT to inspect BEMT’s properties, books, and records and to make such abstracts and copies thereof as any thereof may desire; and

(c) executing and delivering, and causing BEMT to execute and deliver, all instruments and documents, and doing, and causing to be done, all acts and things SOIF II may deem necessary or advisable to register any Pledged Collateral under applicable securities laws and to cause any registration statement with respect thereto to become and remain effective for such period as applicable securities laws may require; and

(d) making or causing to be made all supplements, amendments, and other modifications to any of the foregoing and to any prospectus or prospectuses which SOIF II may deem necessary or advisable for compliance or continued compliance with applicable securities laws; and

(e) causing any Pledged Collateral to qualify under any applicable state securities laws, including without limitation “Blue Sky” laws; and

(f) obtaining any approvals from any governmental authority SOIF II may deem necessary or advisable in connection with such sale or other disposition of any such Pledged Collateral; and

(g) doing or causing to be done any other act or thing SOIF II may deem necessary or advisable for such sale or other disposition to be valid, binding, and in compliance with applicable law.

Section 4.3.2. Voting, etc., of Pledged Collateral.  BEMT shall not vote or take any other steps with respect to the Pledged Collateral without SOIF II’s express prior written consent and SOIF II shall have the sole right, in its sole discretion without any notice to BEMT or any other person or entity, to transfer all or any part of the Pledged Collateral into SOIF II’s name and to vote any and all JV Membership Interests as it deems advisable for its protection.

Section 4.3.3. Application of Proceeds.  Any and all amounts received by SOIF II in connection with any collection, negotiation, setoff, recovery, receipt, appropriation, realization, sale, or exercise of any other right, power, or remedy under this Section 4.3.3 or otherwise may, in its sole discretion, be held as collateral security for the punctual payment, performance, and satis faction, when and as due, of any and all Obligations, and SOIF II may, upon receipt thereof or at any time thereafter, apply all or any part of such amounts against the Obligations.  Only after such application and after payment of any other amount required by any provision of law need SOIF II account to BEMT for any surplus.

Section 5. Miscellaneous.

Section 5.1. Sufficiency as Financing Statement, etc.  This Agreement or any photographic, photostatic, xerographic, or other reproduction hereof or of any financing statement shall be sufficient as a financing or continuation statement.  BEMT hereby authorizes SOIF II, to the extent permitted by applicable law, to file any financing or continuation statement without the signature of BEMT, to complete, execute, and file any such statement on behalf of BEMT, and to file this Agreement as a financing or continuation statement.

Section 5.2. Governing Law; Jurisdiction; Venue.  This Agreement shall be construed and interpreted in accordance with the laws of the State of New York, without regard to its conflict of law principles.  The parties hereto hereby irrevocably (a) consent and submit to the exclusive in personam jurisdiction and venue of the State of New York, in any action or proceeding arising out of or in any way relating to this Note or any instrument or document relating hereto, (b) agree that all claims in respect of such action or proceeding may be heard and determined in such above-referenced state or federal court located in New York,  (c) consent to the service of any and all process in any such action or proceeding by the mailing of copies of such process in conformity with the notice provision hereof, and (d) agree that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

Section 5.3. Waiver of Jury Trial.  SOIF II AND BEMT, BY DELIVERY AND ACCEPTANCE OF THE BEMT NOTE, KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVE THE RIGHT EITHER MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT, OR ANY OTHER AGREEMENT EXECUTED OR CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (VERBAL OR WRITTEN) OR ACTION OF ANY PARTY, WHETHER IN CONNECTION WITH THE MAKING OF THE LOAN EVIDENCED BY THE BEMT

NOTE, ANY OTHER TRANSACTION DOCUMENT, COLLECTION OF SUCH LOAN, OR OTHERWISE.  THIS PROVISION IS A MATERIAL INDUCEMENT FOR ALL SUCH PARTIES TO ENTER THE TRANSACTION DOCUMENTS.

Section 5.4. Notices.  Except as expressly provided herein to the contrary, any notice, report, or writing required or permitted to be given hereunder to any party shall be in writing and shall be served by delivering the same personally either to such party, or by sending the notice postage prepaid by certified U. S. first class mail, return receipt requested, or by FedEx or another reputable delivery service.  Any and all such notices shall be delivered to the parties at their respective addresses specified in this Section 5.4.  Any such notice deposited in the mail shall be conclusively deemed delivered to and received by the addressee on the third business day after the day in which such notice is delivered to the U. S. Postal Service for mailing if all of the foregoing conditions of notice shall have been satisfied.  Any notice delivered by any other delivery service shall be deemed delivered on the date of delivery as indicated by such carrier’s records, absent manifest error.

to BEMT:                                                   c/o Bluerock Enhanced Multifamily Trust, Inc.

Heron Tower, 70 East 55th Street, 9th Floor

New York, New York 10022

Attn:  R. Ramin Kamfar

to SOIF II:                                                   c/o Bluerock Real Estate, LLC

Heron Tower, 70 East 55th Street, 9th Floor

New York, New York 10022

Attn:  R. Ramin Kamfar

with a mandatory                                        Thomas G. Voekler, Esquire

copy to:                                                        Hirschler Fleischer

2100 East Cary St., 4th Floor

P.O. Box 500 (23218-0500)

Richmond, VA  23223

Any party hereto may change its address for the purposes of this Section 5.4 by giving the other parties hereto written notice, as provided for herein, of the new address.

Section 5.5. Time of Essence.  Time is of the essence with respect to every term, covenant, condition, representation, warranty, obligation, and other provision of this Agreement.

Section 5.6. Counterparts.  This Agreement may be executed and delivered in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which taken together shall constitute one and the same instrument.

Section 5.7. Successors and Assigns; Third Party Beneficiaries.  The terms, covenants, conditions, and other provisions of this Agreement shall be binding upon the administrators, successors, and assigns of BEMT, and shall, together with all rights, powers, and remedies of SOIF II hereunder, inure to the benefit of SOIF II and any one or more present or future successors, pledgees, assignees, or endorsees of SOIF II, subject to all applicable provisions of the BEMT Note.  Subject to the foregoing, no term, covenant, condition, representation, warranty, obligation, or other provision hereof is for the benefit of any person or entity not a party hereto.

Section 5.8 Severability.  If any provision in this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue in full force and effect without being impaired or invalidated in any way.

Section 5.9 Entire Agreement.  This Agreement contains the entire understanding between the parties hereto and supersedes any prior written or oral agreements between them respecting the within subject matter. There are no representations, agreements or understandings, oral or written, between or among the parties hereto relating to the subject matter of this Agreement which are not fully expressed herein.

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IN WITNESS WHEREOF, the parties hereto have duly executed, or caused their authorized representatives to duly execute, this Agreement as of the date first written above.

BEMT:

BEMT Meadowmont, LLC,

a Delaware limited liability company

By: Bluerock Enhanced Multifamily Holdings, L.P.,

a Delaware limited partnership

Its:      Sole Member

By:           Bluerock Enhanced Multifamily Trust, Inc.,

 a Maryland corporation

Its:           General Partner

By:           /s/ Jordan Ruddy

Name:      Jordan Ruddy

Its:            COO

SOIF II:

Bluerock Special Opportunity + Income Fund, LLC,

a Delaware limited liability company

By:         Bluerock Real Estate, LLC,

   a Delaware limited liability company

Its:         Manager

By:           /s/ Jordan Ruddy

Name:     Jordan Ruddy

Its:           President